May 2014 Issue of In Business Magazine by InMedia

MAY 2014

Commercial Real Estate: Spotlight on the Valley's Best

Building Development Reinvigorating Our Cities

Healthcare

Is Business, Too

Drugs and Workplace Safety Architecture:

Power Lunch By the Numbers Business Calendar This Issue Global Chamber Arizona Small Business Association

Creating Business Environments

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www.inbusinessmag.com In Business Magazine is a collaboration of many business organizations and entities throughout the metropolitan Phoenix area and Arizona. Our mission is to inform and energize business in this community by communicating content that will build business and enrich the economic picture for all of us vested in commerce. Partner Organizations Rick Murray, CEO Arizona Small Business Association Central Office (602) 306-4000 Southern Arizona (520) 327-0222 www.asba.com

Steven G. Zylstra, President & CEO Arizona Technology Council One Renaissance Square (602) 343-8324 www.aztechcouncil.org

Doug Bruhnke, Founder & President Global Chamber (480) 595-5000 www.globalchamber.org

Jackie Wszalek, President NAWBO Phoenix Metro Chapter (602) 772-4985 www.nawbophx.org

Rick Kidder, President & CEO Scottsdale Area Chamber of Commerce (480) 355-2700 www.scottsdalechamber.com

Mary Ann Miller, President & CEO Tempe Chamber of Commerce (480) 967-7891 www.tempechamber.org Our Partner Organizations are vested business organizations focused on building and improving business in the Valley or throughout Arizona. As Partners, each will receive three insert publications each year to showcase all that they are doing for business and businesspeople within our community. We encourage you to join these and other organizations to better your business opportunities. The members of these and other Associate Partner Organizations receive a subscription to In Business Magazine each month. For more information on becoming an Associate Partner, please contact our publisher at info@inbusinessmag.com.

Associate Partners Ahwatukee Foothills Chamber of Commerce www.ahwatukeechamber.com Arizona Chamber of Commerce & Industry www.azchamber.com

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M AY 2014

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Building Development

BUILDING & DEVELOPMENT

MAY 2014

Commercial Real Estate: Spotlight on the Valley's Best

MAY 2014

IN BUSINESS MAGAZINE

CONTENTS

Reinvigorating Our Cities

Healthcare

Is Business, Too

Drugs and Workplace Safety Architecture:

MAY 2014 • inbusinessmag.com

Building & Development: Reinvigorating Our Cities

Power Lunch By the Numbers Business Calendar This Issue

Creating Business Environments

$4.95 INBUSINESSMAG.COM

Global Chamber Arizona Small Business Association

Growth engenders more growth as Valley development is planned to sustain an expanding economy. Kristian Seemeyer speaks with developers and city planners to get the story on where the key business hubs are, what’s being done to build the business community there and impact on the future. DEPARTMENTS

16 Architecture: Building Our Business

Environment

Alison Stanton captures examples of how local business architecture’s focus on infill, adaptive reuse and new construction is transforming neighborhoods.

“Invention Intervention,” “Legal Through a Click,” “Mobile Apps Keep Folks Reading,” “Kiosk Company Shows What It’s Made Of,” “Ecommerce in an Instant,” “Brokering Real Estate Through Extreme Collaboration,” “Business Starts with a Wine Glass and a Paint Brush” and “Trade Show Displays Made Easy”

John Canfield shares insights on challenges and strategies to help organizations communicate past superficial harmony.

SPECIAL SECTIONS

PRES

ENTS

37 Commercial 49 Global Chamber Partner organization focus

57 Arizona Small

Business Association Partner organization focus

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M AY 2014

32 Legal

12 Briefs

Nice’ Can Be the Enemy

Spotlight on the best

10 Feedback

Noted business and community leaders Bob Graham, Leslie Lindo and Mark Stratz respond to IBM’s burning business question of the month.

26 Collaboration Challenge: ‘Playing

Real Estate

28 Trickle Up

Jane Morris, executive director of Phoenix-Mesa Gateway Airport Authority, introduces the “Building & Development” issue.

FEATURE

9 Guest Editor

15 By the Numbers

Survey probes the attitude of Arizona businesses toward investing in their own business this year.

18 Nonprofit

Phoenix Philanthropy Group president Richard Tollefson discusses why and how today’s governing boards and nonprofit CEOs work together to strengthen social impact.

27 Books

New releases delve into latest insights and best practices for leaders to improve essential and varied skills.

View from the top looks at the business approach Audrey C. Menard, Ed.D., applies to running the Rancho Solano educational institution.

Attorneys discuss workplace safety issues in the medical marijuana era.

34 Assets

2015 Jaguar F-Type R Plus: Comfort and design to create an inviting work space

35 Power Lunch

SOL Cocina Plus: Where to get that java kick

66 Roundtable

Healthcare is business, too, as the costs and consequences of PPACA’s rollout ripple through economy. ON THE AGENDA

29 Spotlight

27th Annual IMPACT Awards Employment Law Update Conference

30 Calendar

Business events throughout the Valley

INBUSINE SSMAG.COM

Because no two clients are ever the same. TM

MAY 2014 • VOL. 5, NO. 5

THE SMART MONEY STAYS IN ARIZONA.

PUBLISHER Rick McCartney

EDITOR RaeAnne Marsh

ART DIRECTOR Benjamin Little CONTRIBUTING WRITERS John Canfield Mike Hunter Kristian Seemeyer Alison Stanton Richard Tollefson

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OPERATIONS Louise Ferrari

BUSINESS DEVELOPMENT

Louise Ferrari Alex J. Goff Craig Jeffries Steve Kulick Maria Mabek Sara May Katie Pacioni Kelly Richards Cami Shore

EVENTS Amy Corben More: Visit your one-stop resource for everything business at www.inbusinessmag.com. For a full monthly calendar of business-related events, please visit our website.

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M AY 2014

Inform Us: Send press releases and your editorial ideas to editor@inbusinessmag.com.

PRESIDENT & CEO Rick McCartney EDITORIAL DIRECTOR RaeAnne Marsh SENIOR ART DIRECTOR Benjamin Little FINANCIAL MANAGER Donna C. Mitchell, CPA ACCOUNTING Bobbie Marciano OFFICE MANAGER Matthew D. Whitmire CORPORATE OFFICES 4455 E. Camelback Road Building C, Suite 135 Phoenix, AZ 85018 T: (480) 588-9505 F: (480) 584-3751 info@inmediacompany.com www.inmediacompany.com Vol. 5, No. 5. In Business Magazine is published 12 times per year by InMedia Company. POSTMASTER: Send address changes to InMedia Company, 4455 E. Camelback Road, Building C, Suite 135, Phoenix, AZ 85018. To subscribe to In Business Magazine, please send check or money order for one-year subscription of $24.95 to InMedia Company, 4455 E. Camelback Road, Building C, Suite 135, Phoenix, AZ 85018 or visit inbusinessmag.com. We appreciate your editorial submissions, news and photos for review by our editorial staff. You may send to editor@inbusinessmag.com or mail to the address above. All letters sent to In Business Magazine will be treated as unconditionally assigned for publication, copyright purposes and use in any publication, website or brochure. InMedia accepts no responsibility for unsolicited manuscripts, photographs or other artwork. Submissions will not be returned unless accompanied by a self-addressed, stamped envelope. InMedia Company, LLC reserves the right to refuse certain advertising and is not liable for advertisers’ claims and/or errors. The opinions expressed herein are exclusively those of the writers and do not necessarily reflect the position of InMedia. InMedia Company considers its sources reliable and verifies as much data as possible, although reporting inaccuracies can occur; consequently, readers using this information do so at their own risk. Each business opportunity and/or investment inherently contains certain risks, and it is suggested that the prospective investors consult their attorney and/or financial professional. © 2014 InMedia Company, LLC. All rights reserved. No part of this magazine may be reproduced or transmitted in any form or by any means without written permission by the publisher.

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JANE L. MORRIS, EXECUTIVE DIRECTOR, PHOENIX-MESA GATEWAY AIRPORT AUTHORITY

GUEST EDITOR

Leading New Growth

AS EXECUTIVE DIRECTOR at Gateway Airport, Jane Morris oversees more than 100 employees that manage an operation with an economic impact in the community of more than $1.3 billion. Additionally, the Authority currently manages the predevelopment activity to construct a new terminal complex on the opposite side of the airfield. Morris has focused on the development and operation of a broad spectrum of municipalowned facilities and services. During her 28 years with the City of Phoenix, she was in leadership roles with a number of significant programs and services, including the development of a new municipal office complex, numerous cultural facilities and the Phoenix Sky Harbor Airport Sky Train.

PHOENIX IS ONE of the largest metropolitan areas in the country, and it is coming back strong after taking a bad hit in the wake of the housing collapse five years ago. The Valley is diversifying its economy and creating multiple centers as economic engines. At Phoenix-Mesa Gateway Airport Authority, we’re working strategically to keep this “economic engine” running strong and on improving the community benefits of a growing commercial airport. The Airport’s last annual economic impact study showed greater than $1.3 billion in total economic impact. Gateway is in the top 100 airports measured by total passengers served and we are second in Arizona with the most nonstop destinations served (36 via Allegiant Air). The Airport Authority Board of Directors consists of members from five municipalities and one Indian tribe. This creates a significant partnership that provides for a long-term commitment to the protection of this East Valley asset. Gateway is one part of this issue’s cover story, “Building & Development: Reinvigorating Our Cities.” Writer Kristian Seemeyer identifies other key Valley areas as well where growth is planned or expected, and examines what is being done to develop these hubs and how they will drive our economy going forward. Other people she spoke with are some of our city planners, developers of some of the significant projects, and leaders of regional and statewide economic development organizations to present this view of what reinvigorating our economy means to business. Another aspect of development is explored in this issue’s “Sector” article on architecture. Alison Stanton focuses on significant projects of new construction and adaptive reuse that shape the business environment in their neighborhood. The “Communicate” feature looks at collaboration — some of the challenges and how to make sure it works in a positive way. “Legal” deals with employer issues around substance abuse in the workplace. Taking a new approach to its “Nonprofit” column by debuting in this May issue a collaboration with respected consultant company The Phoenix Philanthropy Group, In Business Magazine deals with the business side of running a nonprofit organization. This first of the monthly articles examines the importance and impact of the relationship between the top executive officer and the chairman of the board of nonprofit organizations. And this issue of In Business Magazine presents a special section on commercial real estate: “Commercial Real Estate Leaders and Leading Properties”. In Business Magazine continues to be a well-rounded resource for the broad spectrum of our business community. I’m pleased to welcome you to this May issue. Sincerely,

Connect with us: Story Ideas/PR: editorial@inbusinessmag.com

Jane L. Morris, A.A.E. Executive Director, Phoenix-Mesa Gateway Airport Authority

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Growth Factors COLLABORATING WITH THE many business organizations and economic development people throughout metropolitan Phoenix has clued us in on some great growth and what many of the sectors are focused on to build business here. One such sector looks far ahead to plan our cities’ growth and develop our land for more profitable use. Development is that sector, and what we discovered is that we are

Business Events/Connections: businessevents@inbusinessmag.com

smarter and more innovative than ever before. Each city and company we spoke with tells us they are open to great ideas, both new and proven. Due to our recent recession, they are a bit more cautious, but that caution is spawning sustainable and economically valuable projects. One great project is the Phoenix-Mesa Gateway Airport. We want to thank Jane Morris for helping to guide this issue as

Guest Editor. Her very hard work steering the Gateway area to future success is a true example of innovation coupled with good ol’ determination to get things done. With bumps in the road certain on any such project, it is willing city leaders, business investment and a drive to make Arizona the best place to do business that makes all of the difference. —Rick McCartney, Publisher

M AY 2014

FEEDBACK

VALLEY LEADERS SOUND OFF

Executives Answer

How are infill projects contributing to the economic growth and revitalization of our city?

Bob Graham Principal Motley Design Group Sector: Architects SINCE THE 1950s, development of our cities has been outward, driven by cheap land in the suburbs. That left our downtowns to decay. We have an opportunity to take advantage of existing infrastructure and trends toward urban lifestyles to reinvigorate these areas. Redevelopment projects, including both adaptive uses of existing building stock and infills of vacant lots, bring new investment, new jobs and higher property values to downtowns. Infill projects also have a cumulative effect, as each completed redevelopment project makes others feasible. The increased density created by infill makes everything in the city work more efficiently. For instance, density makes public transportation economically viable, which makes it possible to rely less on the automobile. That appeals to the Millennial generation and empty-nest Boomers who are looking for a walkable urban environment. Infill and adaptive use projects also tend to make more interesting, livable environments. Revitalized historic areas have a sense of the “roots” of a place and are seen as exciting and visually appealing when compared to the sanitized, homogeneous character of suburban development.

Leslie Lindo Co-Founder and Executive Director Project Rising Sector: Community Development FORTY-THREE PERCENT of the land in Phoenix is made up of vacant lots, and we have yet to quantify all of the vacant buildings. Rather than building out, we can fill in these vacant spaces with new places to live, work, learn and play. This is infill development, which, done well, has real social, environmental and economic benefit. Perhaps some of the most compelling arguments for infill development from the community level are the economic factors. The combined cost of housing and transportation are statistically less in compact and connected communities, allowing for more of the household income to feed back into the local economy. A 2014 study by Smart Growth America and The Metropolitan Research Center also found a direct relationship between compactness and individual upward economic mobility. On the city level, there is competition to attract and retain talent, business and investment. Much of what drives that is the desirability of the area. Our two largest demographic groups — Baby Boomers and Millennials — are trending toward areas with access to amenities within walking distance. Project Rising projectrisingphx.org

Motley Design Group motleydesigngroup.businesscatalyst.com/

Bob Graham is a principal of Motley Design Group, Phoenix architects specializing in adaptive reuse, historic preservation and infill projects. He serves as chairman of the City of Phoenix’s Central City Village Planning Committee, as a board member of the Phoenix Trolley Museum and the Grand Avenue Members’ Association, and is founder and president of the Grand Avenue Rail Project.

Mark C. Stratz Vice President, Office Group Cassidy Turley Sector: Real Estate REVITALIZATION OF OUR urban areas is all about people and amenities. Infill projects that contribute to this revitalization should bring one or both of these key elements. We have seen student housing and apartment development, along with new, modern office buildings in Tempe and in Downtown Phoenix that have brought many new people to those destinations to live and work. As people fill up the streets, markets, restaurants and parks in our urban areas become more vibrant. Old Town Scottsdale is a perfect example. As these places become more

M AY 2014

Leslie Lindo is co-founder and executive director of Project Rising, a Phoenix-based incubator for infill and adaptive reuse projects. As a builder representative in the production home industry for many years, Lindo gained first-hand exposure to the unintended consequences of sprawl development. Compelled to change this standardized approach to building, she became the first Certified Sustainable Building Advisor in the state of Arizona and co-founded IKOLOJI, Inc. to advance a sustainable society through education and economic development.

vibrant, the neighborhoods get more popular and then an upward spiral of positive momentum builds toward a critical mass. Likewise, amenities such as retail, hotels, the arts and entertainment venues draw people to our city cores and enrich the urban experience. Small concert venues, art galleries, shops and local bars fill in to support the increased office and apartment populations and contribute to economic growth and sustainability of our city cores. Developers of infill projects should be looking at both people and amenities to drive their projects from concept to reality. Cassidy Turley cassidyturley.com

Mark Stratz began his office property career in 1999 representing tenant and landlords in Downtown Seattle. Since moving to Phoenix in 2004, Stratz has expanded his real estate practice to include land sales, building sales and joint ventures. Working with Tyler Wilson and Scott Baumgarten, Stratz is part of one of Cassidy Turley’s most successful office teams, completing more than 1.1 million square feet of leases since 2010.

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QUICK AND TO THE POINT

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Legal Through a Click LEGALZOOM.COM, INC. HAS widely been received as a valid option for businesses, for smaller documents and ongoing corporate compliance. Setting out to create new standards and convenience for business owners, the accredited site offers legal protection in the areas of trademarking, business start-up in all 50 states and other common legal issues. For the more complex needs, the site serves as an advisor in finding local attorneys who can further assist for both business and personal legal needs. legalzoom.com

Mobile Apps Keep Folks Reading ON-THE-GO READING of books on business or articles that can help a businessperson to success are as close as the three most useful eBook apps — Kindle by Amazon, Barnes & Noble’s Nook and Apple’s iBook. These free apps are downloadable to PDIs and allow users to purchase and read books from any of the three services. The different services have lending programs and offer the ability to sort the eBooks for easy use and reading on phone or tablet. play.google.com/store/apps

Kiosk Company Shows What It’s Made Of

ALTHOUGH IT’S A B2B company and its showroom is open only by appointment, Zivelo has chosen Scottsdale Fashion Square for its corporate headquarters. The company designs, manufactures and distributes selfservice kiosk and digital signage systems intended, according to company founder Ziver Birg, to “change the way humans interact with machines.” Birg says the unique space he’s created at the mall for his company “matches who we are” — a unique company with a unique product. Birg calls the design studio/showroom/ conference space that opened in March on the mall an “experience center that will allow our customers to understand our product.” Zivelo’s product is a platform for embedding more than 500 suppliers’ products, such as receipt printers, card readers and touch screens. The company can customize more than 100,000 configurations to accommodate more than 40 market sectors and 300 unique use cases, Birg says. The systems are built into one of Zivelo’s 50 chassis, which range from desktop to wall-mount to floor standing, with screen

sizes of 19 to 90 inches. The terminals are handcrafted at the company’s manufacturing facility in Marion, Ind. The store’s mall location, on the ground floor near Crate & Barrel, is designed to be open yet segmented. Windows offer the public views into a “microbullpen” configuration where groups can be seen in collaborative activity among the business’s multiple divisions. “Our intention is to have people curious about what we do,” Birg says. “Therefore, why not put ourselves in a glass box in one of the most happening places in Arizona — to leave people with a sense of curiosity, to investigate more who we are and what we do.” Birg moved the company headquarters from Indiana to Scottsdale after considering several

VISUALIZE THIS

Seeing Is Believing Ecommerce in an Instant

BUILDING ONE’S OWN business online is easy

these days, and Shopify, Inc. is a complete online e-commerce solution to sell and manage a product-based business. With templates online or by creating a personalized one, it is as easy as uploading the products, information, images and logos to be open for business worldwide. A trusted solution, Shopify advises on how to sell, market and run an online store. shopify.com

M AY 2014

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Photos courtesy of Zivelo (top)

service providers so that entrepreneurs can feel

by RaeAnne Marsh

QUICK AND TO THE POINT

other locations. “We were looking for a place where the tech footprint is expanding,” Birg says. Here, he says he’s found a lot of talent. And he also credits the City of Scottsdale, Arizona Commerce Authority and Greater Phoenix Economic Council, who “became unbelievable partners for us throughout the selection process.” Zivelo zivelokiosks.com

Trade Show Displays Made Easy

AIR IS WHAT powers Skyline’s breakthrough exhibit system called WindScape. Fabricated with a bladder system that creates the framework, WindScape inflates in three to four minutes. It also offers the convenience of being lighter-weight than traditional exhibit systems. Where a traditional 10-foot backwall will weigh 60 to 80 pounds, a 10-foot WindScape backwall weighs about 20 pounds — with case, about 30 pounds — and pack compactly for transport and storage. WindScape earned Phoenix-based Skyline Southwest the People’s Choice Award this past March at EXHIBITOR2014, the largest trade show for tradeshow manufacturers. David Byram, the company’s managing director, says WindScape “has exceeded our wildest expectation of reception in the marketplace” since the company introduced it in August last year. The 10-foot backwall system, which Byram says is Skyline’s No. 1 product, is one of WindScape’s 46 different shapes and sizes available. Among the others are cylinders and rings that hang from the ceiling and 16-foot and 18-foot towers that allow an exhibitor to get signage above without rigging to the ceiling. The WindScape exhibitor system can be as small as a tabletop display or a full-sized, four-sided conference room with a door opening. Graphics can be single- or double-sided, and fit like a pillowcase over the frame, zipping at the bottom. “Exhibitors can change out the graphic as much as they desire,” Byram says. Stored with the frame, the graphics are produced on what Byram describes as “material that minimizes the wrinkles” when the display is inflated. Skyline Southwest skylinewindscape.com

Business Starts with a Wine Glass and a Paint Brush

FRANCHISEES OF ARIZONA’S first Painting with a Twist, Shernell and Jeremy Mays, say they fell in love with the concept from their first experience as customers. They decided to open a studio for the art class/social hour in Tempe when they moved to the Valley from Texas last September, and Shernell says she’s found the business environment very supportive. “At Tempe Chamber of Commerce meetings, people are excited to hear that there’s something new to the commerce community,” she says. “We’re more than an art class — we’re an art party,” Shernell says. The studio, which can hold 48 in the main room and another 24 in the private party room, provides all the serving needs for BYOB wine and all the art supplies. Each class is scheduled for a specified painting out of the more than 4,000 the Mays have copyright to and that span the range of painting genres. Instructors the Mays hire must be artists themselves, but, says Shernell, “It’s more about ‘Are you able to entertain?’” Combining wine and art in a setting where friends can get together and have fun is a big part of the business. But Shernell notes, “We do a lot for families and for communities.” The classes themselves serve as bonding events that bring families together, and some of the sessions are designated as “Painting with a Purpose” events from which half of the proceeds are donated to a chosen charity. And the instructors are encouraged to promote their professional art career after their class because, says Shernell, “We’re trying to bring awareness of the art community.” Painting with a Twist paintingwithatwist.com

Brokering Real Estate Through Extreme Collaboration

ABI MULTIFAMILY TAKES a collaborative approach to what has, traditionally, been a competitive one in creating a team to serve investors in the multifamily sector of commercial real estate. “We are all seasoned brokers, and we leverage each other’s strengths,” says co-founder John Kobierowski, referring to partners Rue Bax, Eddie Chang, Doug Lazovick and Alon Shnitzer. Kobierowski says he, Bax and Shnitzer started to put the concept together a few years ago, and, with the market in the upswing now, decided to “start fresh and build from the ground up, technology-wise, systems-wise and culture-wise.” Instead of teams of extreme specialization, ABI’s concept is to build a thorough understanding of the property among the team to best bring out all the strengths of the property. The market has been in a slow and steady climb since bottoming out in 2009 and ’10, and Phoenix, which has always been a tertiary market for international investors — who favored L.A., the Bay Area and New York — has become more first-tier, according to Kobierowski. Investors seeing flat returns in their home market have told him they see more growth potential and stability here, he relates. “It’s great to know Phoenix is finally on the radar as being a market that foreign investors can look at and comfortably invest in.” ABI Multifamily abimultifamily.com

M AY 2014

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Photos courtesy of Skyline Southwest (left), Painting with a Twist (right)

BRIEFS

QUICK AND TO THE POINT

BY THE NUMBERS Money for Business What are businesses’ investment plans? Do you plan to invest in your business in 2014? Arizona %

National %

Yes

64*

*This number increases to 82% of owners of business that have revenues of more than $20 million per year.

Businesses Are In Expansion Mode

Do you plan to make any of the following investments in 2014: Arizona %

National %

The majority of Arizona businesses plan on investing in their own business this year

Expand operations

Upgrade or purchase new equipment

by RaeAnne Marsh

Modernize technology and systems

Hire more employees

Increase spending on employee training

Other

SIXTY-FIVE PERCENT of Arizona business owners and executives plan on investing in their business in 2014, with upgrading and/or purchasing new equipment, along with modernizing technology and systems, cited as their primary expenditures, according to an anonymous survey by independent research company Pollara released recently by BMO Harris Bank. That coincides with a favorable banking climate. “Across banking, we’re seeing some of the most robust competition that we’ve seen in the last three or four years,” says Tim Bruckner, Arizona managing director of Commercial Banking for BMO Harris Bank. “It is a positive sign for the Arizona economy that a majority of businesses are feeling they are once again in a position to invest in their company,” Bruckner says. “We are seeing increased financing opportunities across a variety of sectors from businesses looking to invest in new technology and equipment or capital expansion.” Technology spending is especially hot in healthcare, food and agriculture, and general technology industries. In fact, Bruckner says that “healthcare accounts for about one-third of what we’ve done in Arizona … because of repositioning in the healthcare space to effectively meet the changing environment brought about by the Affordable Care Act.” Among the 35 percent of Arizona respondents who are not planning to make business investments in 2014, the most popular reasons given are the state of the economy, the fact that their business is INBUSINE SSMAG.COM

performing well enough, and upgrades are not seen as necessary at this time. As for funding, nearly three-fourths (74 percent) of those planning to make investments in their business say they will do so with cash reserves. Eight percent plan to fund the investments entirely through borrowing, while 17 percent plan on doing a combination of both. “These findings demonstrate that the business community continues to be conservative in the use of debt for funding growth, stemming from what they learned during the recent recession,” says Jud Snyder, managing director and head of BMO Harris Equipment Finance Company. “However, intermediate-term borrowing should still be strongly considered as an option for financing growth with interest rates continuing at historic lows.” Bruckner also observes, “There is a fair amount of capital spending related to projects that were contemplated for many years but were held off on until the economy proved strong enough.” All of this activity is an encouraging sign, he says, because, as that money is spent and capacity begins to go into production, “we will see increases in hiring and expansion of the economy locally.” Additional hiring, he has found, follows after a company has been investing in itself in other ways, whether technology, capital expansion, new equipment or other areas. BMO Harris Commercial Bank Resource Center resourcecenter.bmoharris.com

Will you be paying for these investments using cash reserves or by borrowing money? Cash reserves Borrowing money Both

Arizona %

National %

And why are you not planning on making any business investments in 2014? Arizona %

National %

My business is performing well, and these upgrades aren’t necessary

Given the current economic climate, this isn’t a good time to invest

I don’t have the capital on hand to make these investments

I don’t think these would be wise investments

I’ve made major investments recently

I’m saving up for investments in 2015 or later

Other

The survey was conducted by Pollara with an online sample of 601 American business owners in November, 2013. A probability sample of this size would be accurate to +/- 4%, 19 times out of 20.

M AY 2014

SECTOR

INDUSTRY AT ITS BEST

Architecture: Building Our Business Environment

The Marina Heights project at Tempe Town Lake, with DAVIS as both architect and interior designer, brings new construction to the area and will span 20 acres

Local business architecture focuses on transforming neighborhoods with infill, adaptive reuse and new construction By Alison Stanton

M AY 2014

are returning to the city center and are not wanting to drive an hour to work indicates a shift in the way people want to live their lives.” Transforming an old school, church or other building into something vibrant and new has its inherent sets of challenges, Rumpeltin notes. It requires a great deal of flexibility as unknown and unseen issues become apparent. They are almost always complex, challenging and demanding, he notes, and they require more thought than ground-up building projects. Expressing his hope that adaptive reuse projects are not just a fad, he says, “They really do help acknowledge the uniqueness of Phoenix.” Jason Blakley, program manager for the Planning and Development Department in the Office of Customer Advocacy in Phoenix, also speaks to the benefit of adaptive reuse

of existing buildings in helping strengthen and reinvigorate existing neighborhoods by providing new dining, retail and service options. And he adds, “Establishing these new uses in existing buildings also helps eliminate blight and supports green building principles by reusing existing materials and reducing waste.” Three examples of adaptive reuse projects in Phoenix are The Refuge Coffee & Wine at 4727 N. 7th Ave., Desert Song Yoga at 3232 N. 20th St., and Taco Guild at 546 E. Osborn Rd. These projects involved, respectively, transforming a former motorcycle dealership into a coffee and wine bar, turning a former electrician’s union hall and offices into a yoga and massage center, and remodeling classrooms and an existing church building into a restaurant. For Brian Cassidy, president of CCBG Architects, Inc., working on adaptive reuse projects in the core of downtown “To be able to take old buildings and Phoenix is a passion. He estimates his firm has worked on 30 or so of these re-purpose them for reuse is important. projects over the years — six of which They can be updated to make them relevant are currently under construction. and useful for our times … We, as humans, “If the building has out-lived its have a social responsibility in our roots and use but the structure is still good, I think these types of projects say as a culture to respect old architecture.” community that we are responsible, —Michael Rumpeltin

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Photos courtesy of DAVIS

AN OLD MOTORCYCLE dealership that is now a vibrant coffee and wine bar. An old abandoned produce warehouse transformed into a stylish and modern office building. A multi-story, multi-use contemporary building complex in the heart of a thriving waterfront location. These are just a few of the many architectural projects that not only provide places for people to work, eat, shop and congregate, they also help to define the overall business philosophy of the Phoenix metropolitan area as one that values the past while welcoming the future. Adaptive reuse projects are really starting to take off in popularity, observes Michael Rumpeltin, architectural designer and owner of Brick & West, LLC in Phoenix. Instead of tearing down an old church that is no longer in use, today it is more likely that the building will be transformed into a restaurant or other usable space. “To be able to take old buildings and re-purpose them for reuse is important. They can be updated to make them relevant and useful for our times,” he says. “We, as humans, have a social responsibility in our roots and culture to respect old architecture.” Rumpeltin, whose firm focuses on adaptive reuse projects as well as hospitality and urban infill mixed-use, grew up on the East Coast, where these types of projects have been common for some time. “My original stomping ground was Manhattan; when you travel to cities older than Phoenix, you find a plethora of old buildings being reused,” he says, adding that adaptive reuse projects are an indicator of how a city is growing, as well as helping renew an interest in what he calls an urban walking environment. “I think the fact that people

Photos courtesy of CCBG Architects (top), City of Phoenix (bottom)

and that we acknowledge the contributions that these buildings have made.” In many cases, Cassidy explains, the older buildings have a lot of charm and are very well made. Although building code issues often come up and many things have to be adapted to modern standards, Cassidy’s strong belief in re-inventing existing buildings makes it all worthwhile.“It’s a real labor of love, but we love doing it. It’s very rewarding work.” One adaptive reuse project that Cassidy’s firm handled involved transforming an old two-story produce warehouse that once had rail cars pulling up to it into a modern public relations office. While some people look at the old buildings with skepticism, he says, peeling back the layers to see what treasures can be found is very rewarding. “It is the character of these buildings that is hard to replicate; we no longer use many of the same materials and craftsmanship,” he says, adding that instead of the city just allowing old buildings to sit and rot away, adaptive reuse helps to re-engage people in their own neighborhoods. “These projects are ideal for clients who have courage and want to come downtown and help to make a difference.” Steve Venker, planning and design services manager for the City of Scottsdale, has seen a lot of reinventing of existing buildings over the last several years. He cites Scottsdale Quarter as a great example of repurposing a location into something new. “The successful relocation of the Dial research facility that had been there opened up the opportunity for Scottsdale Quarter.” These types of projects help to show business owners there is opportunity in Scottsdale, Venker says, adding the city has existing sites for those who want to rehabilitate or reuse buildings as well as the opportunity to construct new buildings. The Scottsdale City Council’s approval The adaptive reuse project on Osborn Road in Phoenix a few blocks east of Central Avenue remodeled an existing church building into a restaurant

INBUSINE SSMAG.COM

The Marina Heights project at Tempe Town Lake, with CCBG designed a creative, collaborative space DAVIS as both architect from a 1940s plumbing store and warehouse in and interior designer, brings an adaptive reuse project for Moses Anshell in new construction to the Phoenix’s area old andWarehouse will span 20District acres

last December of two zoning ordinance amendments — one in support of the Greater Airpark Character Area Plan and the other in support of the Downtown Character Area Plan — relate to new construction. Each amendment provides flexibility for properties in these two growth areas by allowing development standards that increase allowable height and floor area ratio (FAR), and by creating standardized bonus opportunities relative to development standards in exchange for public benefits that projects would include. Optima Sonoran Village, currently under construction at the southeast corner of Camelback Road and 68th Street, “is one new development project [that] has been approved to use the provisions of the … amendment that is related to the Downtown Area,” Venker says, and gives Impact Church/Sunrise Commons, which has an application for a project in the other area now in the public hearing process for entitlements, as another example of a project going forward on the strength of these zoning ordinance amendments. New business construction is also underway at Tempe Town Lake. Architectural design

firm DAVIS has completed the design portion of the Marina Heights project, a two millionsquare-foot multi-use office development that will house the new State Farm regional office. Construction will begin in August with a scheduled opening in 2015. Richard Drinkwater, principal architect and project designer, describes the project as the single largest office development deal in Arizona’s history. It will have five buildings, ranging in size from six to 16 stories and spanning 20 acres along Tempe Town Lake. Retail amenities like coffee shops, restaurants and fitness facilities will be designed “to fit in well with the surrounding buildings and the environment,” he says. Architecturally, Drinkwater notes, the project speaks to the occupant’s corporate aesthetic, which values creativity. He believes the project will send the message of a very vibrant and welcoming business community. Brick & West, LLC brickandwest.com CCBG Architects, Inc. ccbg-arch.com City of Phoenix Planning and Development Department phoenix.gov/pdd City of Scottsdale scottsdaleaz.gov DAVIS thedavisexperience.com

The Osborn Road project also features adaptive reuse of part of Old School 07 into a Starbucks and other retail space

M AY 2014

NONPROFIT

THE BUSINESS OF MAKING A DIFFERENCE

Shared Leadership

Today’s governing boards and nonprofit CEOs work together to strengthen social impact by Richard Tollefson

“The challenge for nonprofits often comes from stakeholders’ inherently different perspectives — for nonprofit internal staff and management, passion and commitment to the mission is what fuels and shapes activity and defines success.” —Steven Stralser

CORPORATE EXECUTIVES WHO find themselves sitting on the board of a nonprofit might initially wonder — in a boardroom filled with so much leadership talent — Who’s in charge? What role do I play? What role does the CEO of the nonprofit play? The answers have changed dramatically as nonprofit organizations have been forced to serve more people in need with fewer resources (due largely to declining government support). As a result, nonprofit CEOs are increasingly some of most innovative, forwardthinking leaders in our economy and society. They develop new products and services to meet market demands, build brands, diversify revenue streams, hire strong talent and measure results — all on limited budgets. How do they achieve such success? By leveraging the skills and expertise of their board members and through shared leadership.

The Challenges of Shared Leadership The biggest stumbling block to leadership collaboration is simple misunderstanding. Those executive board members who understand the organizational and philosophical priorities of the nonprofit — and how they differ from corporate philosophies

and structure — often make the most impact within the organization. Take, for instance, the multifaceted leadership model of the nonprofit and its democratic “many voices being heard and heeded” philosophy. Nonprofit organizations are led by a CEO but influenced greatly by the governing board of directors/ trustees, as well as the constituents being served by the organization. This is in stark contrast to the autocratic model of many corporations, which are led by a single person, generally the owner or leading shareholder. Misunderstanding the governing model of nonprofit organizations has led to serious challenges for a number of corporate executives who step into nonprofit leadership roles. Another philosophical difference in the nonprofit organization is its focus on managing the triple bottom line: optimizing financial return, social impact, and social and environmental sustainability. While some enlightened corporations subscribe to this triple focus, many are driven mostly by profit and shareholder value. Even though nonprofit CEOs and boards determine their financial bottom line through increased revenue — although perhaps not using the word “profit”— they also pay attention to increasing

In Business Magazine has partnered with The Phoenix Philanthropy Group to bring readers and online users a column in each issue dedicated to informing and inspiring nonprofit leaders and local businesspeople on leadership and best practices for the nonprofit sector.

M AY 2014

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their operational efficiencies and productivity, building operating reserves and managing diverse assets. Key to their mission, also, is enhancing the quality of life for people in need. As well, they’re always concerned about sustaining the organization in the long term, a key consideration by donors looking to invest in the nonprofit organization. “The challenge for nonprofits often comes from stakeholders’ inherently different perspectives — for nonprofit internal staff and management, passion and commitment to the mission is what fuels and shapes activity and defines success,” says Steven Stralser, emeritus professor of entrepreneurship at the Thunderbird School of Global Management and a leading management consultant and board member on numerous nonprofit and for-profit organizations. “For the board and its governance responsibilities, success is focused on organizational efficiency and financial sustainability.” Stralser’s statement leads back to the question of roles and responsibility in the nonprofit. Traditionally, the CEO oversees and manages staff, implements the strategic plan, and, with his or her team, is responsible for ongoing operational and financial management. Historically, the board of directors has ensured that the organization operates within its mission, oversees the CEO, and accepts legal and fiduciary responsibilities as defined by the organization’s bylaws. Together the board and CEO have worked mostly toward meeting strategic planning, fundraising, public advocacy and awareness goals. Today, various models exist. For example, many boards of young or less sophisticated organizations serve as operational/working boards, as part of which members are engaged in all functions and aspects of the organization. In more mature organizations, board members may be deployed strictly in their strategic, fiduciary roles. And in still other organizations, a new model of shared leadership is emerging as CEOs handpick board members to meet needs in key functional areas. Chevy Humphrey, CEO of the nonprofit Arizona Science Center, is one such trailblazer. Also chairman of the board of the global Association of Science-Technology Centers, she knows what it is like to serve on both sides of the shared leadership equation. She considers her board members high-level — but unpaid — consultants whom she engages based on their professional expertise and personal INBUSINE SSMAG.COM

interests. Board members, she explains, are often an untapped resource offering tremendous expertise in legal, financial, human resources or other functional areas. Boards also are, increasingly, a source of innovation. They often bring an entrepreneurial spirit and perspective to the boardroom, offering new models of sustainability.

Making Shared Leadership Work How can shared leadership optimize the nonprofit’s overall performance and social impact to ensure short- and long-term success and sustainability? ■■ Shared Vision: Shared leadership is successful only with shared vision. The board of directors must agree with the CEO on the vision of the organization’s future.

break down. It is important that the CEO partner with board members, offering them real responsibilities based on their expertise, as that will ensure their experience is rewarding, beneficial and impactful to the organization — and to them. ■■ Transparency and Accountability: Shared leadership requires openness, transparency and accountability on all sides, which will be aided by open communications and meaningful and regular performance reporting. Bottom line: No one likes to be surprised when leading an organization, no matter if that surprise is a positive or negative one. ■■ Shared Learning: Board members bring talents and perspectives to CEOs and their staffs based on diverse professional, community and personal experiences.

Those executive board members who understand the organizational and philosophical

Boardroom Image TK

priorities of the nonprofit — and how they differ from corporate philosophies and structure — often make the most impact within the organization.

■■ Agreed-Upon Plans, Strategies and Goals: The board of directors must work with the CEO and staff from agreedupon operational and strategic annual plans and prioritized strategies to achieve clearly defined goals and expectations. The board, CEO and staff should agree upon key performance indicators or metrics to measure performance against the plans and expectations. Additionally, in creative entrepreneurial organizations the opportunity exists to inspire new performance- and service-related ideas through defined parameters for creativity, risk and experimentation. ■■ Culture of Mutual Respect, Trust and Benefit: Shared leadership must be rooted in a culture of mutual respect and trust between the board and CEO. If either is skeptical of the other’s commitment or competency, shared leadership can quickly

Likewise, board members can learn from CEOs and staff — particularly when it comes to the social and economic issues impacting the people served by the organization, programs and services the organization offers, and the very real differences of managing a nonprofit organization versus a for-profit corporation. ■■ Celebrating Success: Celebrating victories large and small builds a stronger bond between the board, CEO and staff. Individual and team performance can be recognized, and the strategies and tactics that led to that success can be highlighted and leveraged to benefit other functional areas. The Phoenix Philanthropy Group phoenixphilanthropy.com

Richard Tollefson is president of The Phoenix Philanthropy Group, an Arizona-based international consulting firm serving nonprofit organizations as well as institutional and individual philanthropists.

M AY 2014

Building Development Reinvigorating Our Cities

Growth engenders more growth as Valley development is planned to sustain an expanding economy by Kristian Seemeyer

DURING THE BOOM, cities went wild and planned as if the growth stage would never end. One result was an overbuilding of retail on virtually every corner. This was fine when homes were occupied, but when the Valley went bust, retail space became a different story. This was a huge mistake, according to Barry Broome, president and CEO of the Greater Phoenix Economic Council, because during the recession, the cities were left with huge deficits. During the boom, he says, cities should have been focusing on infrastructure and a plan for after the boom. What goes up, must come down. Cities planned like the boom would never end. But cities are looking toward a brighter future by focusing their efforts on attracting new business.

does hope to double the number of businesses at the airport within the next ten years — a seemingly attainable goal considering in 2012 Phoenix-Mesa Gateway was the fastest-growing small hub airport in the country. It grew by 42 percent that year. Morris believes Phoenix-Mesa Each city has its own take on how to attract the most commerce. The Gateway will eventually reach that next level of a medium-sized airport, so-called “tech zones,” where technology-related businesses are clustered, though she believes it to be beyond the 10-year window. The airport is are attracting the most robust interest by far and each city has its own hot currently served by Allegiant Airlines and its 35 destinations. spot and reasons why that particular city should win the business. All this growth takes thoughtful planning and a team of marketers. The City of Chandler relies heavily on the Price Road Corridor Morris says the airport holds a unique set of assets because the aviation as a major business attractor. The Price Road Corridor is bordered field is a niche market — but, in spite of this, it still takes some effort by Ray Road to the north, Ocotillo to the south, Dobson to the east to attract business. For this, the airport authority employs a team of and McClintock to the west. It’s surrounded by high-end retail, and consultants, brokers and other air service-related specialists to actively single- and multifamily housing. The origin of Price Road was highseek out business and promote Arizona as a tourist destination. The team tech — Microchip and Intel were among the first tenants. The original works on three prongs of development tenant roster was all high-tech. And within the airport: seeking out this was before the 101 freeway and businesses for developing the 1,000 acres the Chandler mall — 15 to 20 years of real estate, hotels, office, restaurants ago. The area remains a major tech and retail, for example; finding uses of hub, continuing to attract significant the airfield for general aviation purposes technology businesses — and it is only such as maintenance and fueling; and 50 percent built out. commercial scheduled service, which Christine Mackay, economic ties into the tourism trade and which development director for Chandler, Eastmark is a 3,200-acre project being developed by DMB Associates near is seen as eventually bringing more the Phoenix-Mesa Gateway Airport at what had previously been GM’s desert speaks to the legacy of the Price Road proving grounds airlines to the airport. Plans to build Corridor and established demand. a Courtyard by Marriot just outside “Companies are coming to us looking the airport’s entrance were recently for space and the demand is there. The “Businesses surrounding Tempe announced. vacancy rate at Price Road Corridor Public transportation will also play is below 5 percent. The infrastructure Town Lake have earned more than a large role in the airport’s future. “We is there and we are ready to meet the $800 million since the lake opened. are very sensitive to that,” says Morris, demands. We are literally ready to go. noting, “We are planning to allow We have companies that are shovelApproximately 5,000 people have for space for light rail for Tucson to ready,” she says. jobs in Tempe because corporate Phoenix.” She adds, “We have huge Phoenix-Mesa Gateway Airport will potential. Right now, we fly to Vegas and play a huge role in attracting employers and local businesses want to have Oakland, and those two destinations can to Mesa. It totals 3,000 acres and is a Town Lake location.” connect you to the world.” adjacent to three other cities: Queen With much of its plans slated to Creek, Apache Junction and Gilbert. —Chris Messer, City of Tempe come to fruition over the next decade It currently houses 45 employers, Planning Department and more, the airport is already including airlines, and there are 1,000 impacting growth in its environs. acres undeveloped. Future employers DMB Associates, one of the region’s will include those in the aviation premier housing developers, has field, cargo, manufacturing and hotel a major project in the adjacent industries. The economic impact of Eastmark development, which in Phoenix-Mesa Gateway was $1.3 billion turn has attracted Grand Canyon for 2013 and the area supports 10,470 University to invest a few hundred jobs at the present time. million dollars to develop a campus “We have 10 gates currently and we there. Says Karrin Taylor, executive plan to add 40 to 60 with the addition vice president of DMB, “They saw it of a new terminal,” says Jane Morris, as a sub-city where people can bike executive director of the Phoenix-Mesa and walk to school and work, and that Gateway Airport Authority, though the was a huge appeal.” timeline for this is unclear. But Morris Eastmark encompasses quality-of-life amenities and will be home to employment centers that already include Grand Canyon University and Apple

M AY 2014

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Photos courtesy of DMB Associates

Focal Hubs of Development East Valley

Photo courtesy of HFF

A portion of the West Valley belongs to While much of Phoenix-Mesa the Great Maricopa Foreign Trade Zone. Gateway’s impact is in plans for Created in 2011, its intent is to reduce taxes, the future, the City of Mesa has thereby creating incentives for business already seen some reinvigorated to locate in the zone. “It’s a tool to attract areas. Since Mesa Arts Center commerce, to attract those high-tech, opened, and in anticipation of high-wage jobs,” Rider says. “And we are light rail, the Main Street area has so regional on the west side,” she adds, become a bustling district filled emphasizing the scope of the organization’s with restaurants, cafes, shops and efforts. “We work in partnership with the art galleries. whole Valley, but we are so regional and, as a Tempe office and mixed-use HFF will be operating in Phoenix from the 43rd Avenue Logistics Center, a new state-of-the-art, 394,775-square-foot industrial facility located at trade zone, we have the transportation with started showing up a couple of 1635 S. 43rd Avenue the rail, I-10, I-17, the 101 and now the 303.” years after Tempe Town Lake And, indeed, the 303 already has a opened in 2001. There was a huge good mix of industrial and retail, with spike last year with the Marina “We’re doing things to Sub-Zero one of the largest job holders, Heights Project for the State Farm along with Dick’s Sporting Goods, and headquarters. “Without Town attract those companies with auto manufacturing to the north. A major Lake, none of the buildings would the higher-wage jobs,” says Rider. housing development, Vistancia, is also have been erected,” says Chris north on the 303. Messer, of the City of Tempe “After that, the rooftops come, “The 303 is scheduled for completion Planning Department. “Businesses and then more retail.” on or before schedule and it’s a great surrounding Tempe Town Lake opportunity for business. It’s also a great have earned more than $800 —Michelle Rider, WESTMARC help for workforce travel,” Rider says. million since the lake opened. Noting there is a myth that there is no work Approximately 5,000 people have force in the West Valley, she observes, “The jobs in Tempe because corporate truth is, we’re exporting a lot of our work force to Central Phoenix. If and local businesses want to have a Town Lake location. Many Tempe you’ve ever been on I-17 in the morning, you know those cars are going assets play into business attraction; without the sense of place it would somewhere. We need the job centers, we need the housing, and more be difficult. Tempe enjoys approximately 2.6 million visitors each year. retail will follow.” This is extremely attractive for businesses wanting to locate here.” The West Valley does have some old infrastructure that needs Roughly 61 acres of developable vacant land remain around Town Lake. addressing, according to Rider. “But I think that’s been an issue for Tempe is and has been focused on the tech industry. Fostering the the whole state,” she says. “We need a tool to be proactive without high-tech research and manufacturing industries, Tempe is invested in extra taxation.” a number of projects, including, but not limited to, ASU Research Park Jeanine Jerkovic, economic development administrator of business (50 acres of developable land), Discovery Business Campus (1.6 million attraction with the City of Glendale, says the city resisted building acres of new development/136-acre site) and Apache Loop 101 Park & homes in the 101 corridor. “We knew we did not want that to be a Ride (14 acres of redevelopment opportunity). bedroom community; retail was always a goal for the stadium district. Malls were big 10 years ago, but not so with the economic downturn.” While some retail areas were able to hold steady during the recession, Focal Hubs of Development others under construction reached a standstill. Arrowhead Mall on West Valley the west side has been a consistent performer in the market, but the building of two other malls, Prasada and Estrella, have been put Michelle Rider, president and chief operating officer of WESTMARC, on hold. What has helped change the face of Glendale’s Sports and foresees a bright future for commerce in the West Valley. WESTMARC Entertainment District, however, was the addition of Tanger Outlets, on (the Western Maricopa Coalition, comprised of 13 separate west-side the west side of Westgate, and Cabela’s. communities) is a public-private partnership dedicated to promoting This success is due to a change in diet, says Brian Friedman, commerce and quality of life in the West Valley. It is estimated that 68 Glendale’s executive director of community and economic development. percent of all Valley growth in the next 10 years will take place on the “The end users are seeing the value. People don’t want to commute; west side. She sees the west side as a hub for industrial and commercial, we are closer to the work force.” And, adds Jerkovic, Tanger purposely and, eventually retail. “We’re doing things to attract those companies does not house a lot of eateries. Instead, walkways have been added with the higher-wage jobs,” says Rider. “After that, the rooftops come, connecting Tanger with Westgate, as has vehicular transport to link the and then more retail.”

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M AY 2014

Return of Retail, Growth of Housing

Despite the recession, nearly every city has seen a revival in its Main Street areas. In some areas, light rail contributed to this, though much of the light rail construction happened during the recession. Independent shop owners played a big role. But consumers seemed to have a diet for meandering the streets, listening to music, seeing A Town Reinvented artwork and dining out — while staying in one area. Many Main Streets featured monthly art walks, like the Downtown Phoenix First One Valley municipality is not only planning for growth but Friday, where vendors and artists and food trucks gather and shops is changing its very profile to accomplish it. Gary Neiss, town and restaurants have extended hours. Chandler, Mesa and Gilbert have administrator for the Town of Carefree, says there has been a dramatic their own versions. These art walks have been so successful creating shift in the past 20 to 30 years. “We used to be a village in a sea of exposure for independent business, cities are finding ways to create desert,” Neiss says. “We were once a very eclectic tourist town and we more of this festival-like atmosphere on more than a monthly basis. relied heavily on that tourism.” The continuation of these city celebrations can play an important But as urban sprawl set in and the desert became eroded by homes, role in supporting the economic vitality of Main Streets, the arts and Neiss says, tourist traffic dwindled. Now the town must look to its own surrounding restaurants and shops. residents for its bread and butter. There are 50,000 people within 15 Valley-wide, retail is an important element in an invigorated minutes of downtown Carefree and the town must now rely on those economy. Closely allied with retail is housing — in fact, the state of the residents for sustainability. And Carefree does still have land platted housing market is often used as an for residential use, according to Neiss. indicator of the overall economy. Fifty-two homes and 24 townhomes are The housing boom of the early part currently under construction. “We used to be a village of this century spawned a mentality Carefree has also hired a third party in a sea of desert,” Neiss says. for a need for a retail center on every to market the town in order to attract corner. Now, retail vacancies are retailers and people in the primary “We were once a very eclectic high and cities are struggling to find market as patrons. They are finding tourist town and we relied other uses for these centers. They are ways to make existing retail spaces being more flexible with zoning and more marketable. “We want to assist heavily on that tourism.” use. E-commerce is contributing to property owners to attract better retail vacancy, but not as much as tenants,” says Neiss. overbuilding. Where there may have The town has also invested been a K-Mart, there may now be a heavily in its center, comprised of an church or a school. There is even a amphitheatre, which plays host to trend to put multifamily housing on at least nine festivals per year, and some of these retail corners. surrounding galleries and restaurants. John Wesley, in the City of Mesa The arts have always played a big role Planning Division, says the city is in Carefree’s history, and the town currently experiencing a high retail is now in talks with the Phoenix Art vacancy rate because of overbuilding Museum and Butte Development during the housing boom. In order to for a $90-million mixed-use project Butte Development project in Carefree envisions 80 ultra-luxury condos, correct that, he says, Mesa is trying near Cave Creek and Tom Darlington 50,000 square feet of retail and commercial space, and a satellite location of the Phoenix Art Museum to allow for more flexibility in some roads. The project includes 80 ultraof those overbuilt areas. “We need to luxurious, amenity-stocked condos and bring things back into balance,” he says. “In some of those areas we want approximately 50,000 square feet of retail and commercial space. to allow for multifamily housing and office space.” Butte is working closely with the Phoenix Art Museum and the Town Jeff Kurtz, planning administrator for the City of Chandler, says his of Carefree to consider a 10,000-square-foot satellite museum at the city experienced much of the same. “We saw too much overzoning project. Current discussions include an exhibit schedule that rotates for commercial retail, as well as overbuilding,” he says. “And part of seven times per year and a 1,500-square-foot multipurpose community that high vacancy rate in the retail sector is due to e-commerce. But center. It’s a move Neiss thinks would go a long way toward revitalizing we have some corners that just aren’t going to support retail and so Carefree’s economy and tourism market. we need to have a mentality shift. There is a multifamily trend coming

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Photo courtesy of Butte Development

two destinations, making it easier for consumers to have an all-in-one experience. Westgate has recently added five new eateries. The west side has a variety of communities, all connected by main freeways to support housing. Avondale, Goodyear, Buckeye and Surprise all have room for growth, so as industry comes, housing won’t be as much of an issue as on the east side of the Valley.

Photo courtesy of City of Phoenix

out of the recession — to put apartments or condos on some of those to Taylor. DMB began to work more closely with local chambers of larger retail corners.” commerce, GPEC and the legislature on policy issues on how to attract According to Messer, Tempe was a little better than the average for business — because industry, of course, means workers, and workers the Valley with regard to overall retail vacancy rates through the peak need housing. Working with site consultants, the company has begun of the recession. In 2013, Tempe’s retail vacancy rate was around 7.5 developing a regional sales pitch — not just for its communities, but for percent while the Valley, on average, was at about 10.7 percent. “Our Phoenix and Arizona on the whole. absorption rate is very strong,” says Messer. “Our Economic Development A Lesson Learned team is focused on filling vacant space. With regard to housing, we are Broome says some original city very fortunate to have ASU in our plans will never happen and the city. They do a lot to keep our housing biggest lesson tied to that is the fact stock strong.” that the type of ongoing growth and Phoenix’s downtown area did not prosperity experienced during the see the problem to a great degree. boom is just not possible. “We’ve got To the contrary, infill projects were cities where the housing is all out of taking place even during the recession, balance; areas of blended commercial, according to Jeremy Legg with the City industrial, office — it’s hard to of Phoenix Planning Department. reuse that space,” Broome says. “A The Refuge Coffee & Wine, in Phoenix on 7th Avenue south of Camelback, is an adaptive reuse of a former motorcycle dealership into a neighborhood Downtown Phoenix is known for 2.4-percent GDP is better to plan from coffee and wine bar its funky neighborhoods where one than a 4-percent model. You just don’t might find an art gallery next to a beer start modeling your plans after that garden with a coffee shop on the other type of growth. In an upmarket, you Phoenix’s downtown area did not side and a Jamaican restaurant around build infrastructure, making the future the corner. Legg first gives credit to more affordable for taxpayers.” see the problem to a great degree. all the hard-working entrepreneurs When the market boomed, many To the contrary, infill projects were who put in 80-hour weeks to run cities didn’t plan for the fall. And their businesses. He also believes when the bottom fell out, large taking place even during the these businesses have a creative base deficits, a glut of retail space and an recession, according to Jeremy of 10,000 ASU students to draw imbalance in housing remained. The business from. As for the city, he says bust was a hard lesson to learn from, Legg with the City of Phoenix the government tries to stay out of but the activity now indicates most Planning Department. the way and make it easier for those cities have learned a lesson when eclectic neighborhoods to happen. planning for the future. This also makes it easier to address By attracting business, growth infill. By making the regulatory burden smaller and implementing will happen in the Valley — it has, in fact, already begun. As the new zoning for mixed use, it fosters infill and allows and encourages employment sector recovers, so will the housing market, and retail these projects. will follow. If cities continue in their efforts toward a businessThe import of jobs in Mesa will spawn a major dilemma for its friendly climate and measured residential and retail growth, the housing market, an area where multifamily on vacant retail corners Valley’s reinvigorated cities may be better prepared in the event of makes sense. But Mesa will need single-family housing as well and another fall. does have some land slated for that usage. And Mesa will need more City of Chandler chandleraz.gov housing. It has recently attracted some major employers, such as Apple, City of Glendale glendaleaz.com and Phoenix-Mesa Gateway Airport is becoming a major employment City of Mesa mesaaz.gov center. Wallethub.com recently named Mesa the ninth-best city in City of Phoenix phoenix.gov America for job seekers. “We expect a population growth of 170,000 City of Tempe tempe.gov over the next 30 years,” says Wesley. “And we are trying to attract those DMB Associates, Inc. dmbinc.com big employers, so we are going to have to be planning for housing — Great Maricopa Foreign Trade Zone gmftz.org multifamily and single family.” Greater Phoenix Economic Council gpec.org Phoenix-Mesa Gateway Airport phxmesagateway.org Eastmark developer DMB is one company aiming to answer this Town of Carefree carefree.org convergence of need, having come out of the recession with a new focus WESTMARC westmarc.org on becoming part of a sustainable economy and diversifying, according

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M AY 2014

COMMUNICATE

LOUDER THAN WORDS

Collaboration Challenge: ‘Playing Nice’ Can Be the Enemy Organizations must communicate past superficial harmony by John Canfield COLLABORATION IS THE buzzword of today. Right along with creativity and innovation, everybody’s talking and writing about it, but what does it really mean for business? While it may be a great concept, the real challenge — and the enormous business opportunity — is to learn to collaborate in a way that makes a positive difference to the business. An organization may attempt to build collaboration by gathering into a team unusual people with unusual ideas, and a crossfunctional team recruited company-wide will have perspectives a “silo” team does not consider. This offers an enormous opportunity to capture some really great, new ideas, but there are challenges that must be addressed. The team must, of course, build buy-in for the idea. An idea without buy-in is like a car without a motor or a boat without a sail; both are required to make and implement decisions that improve an organization’s productivity. But how the people behave will affect the quality of the idea the team produces. Meetings very often suffer from artificial harmony, an underdeveloped thinking that emphasizes overly polite and professional discussion and behavior instead of productive communication processes that generate robust dialogue, learning, and significant business results. This reluctance or inability to talk about all the options hampers innovation and growth by restricting the depth and breadth of ideas that get discussed. There are three types of groups, but only one is truly a collaborative decision-making team. In my experience, most teams go through the first two before they arrive at the third, ultimately more effective, classification. Type 1: Co-exist — unaware and undeveloped: This team spends time avoiding conflict, smoothing edges, playing nice, but gossiping about poor accountability among teams throughout the organization. This team does not know how to turn unproductive conflict into productive business success. This team often allows one member to make the decision, to “win,” and the rest just go along with quiet reservations. Decisions elicit poor buy-in and poor support. Type 2: Cooperate — aware but underdeveloped: Members of this team have read and heard management gurus tell them the benefits of functional teams, good meetings, etc. They want to turn unproductive conflict into productive business success, but the management gurus fell short in showing them how to do this, and, as a result, the team remains hopeful but underdeveloped. This team often makes the decision everyone can live with, settling for a C-, not-so-bad decision. The thinking here produces a possibly better decision with improved buy-in and support but falls short of what’s available. Type 3: Collaborate — aware and developed: Not only have the team’s members read and heard management gurus tell them the benefits of functional teams, good meetings, etc., but, more significantly, they have been taught how to see conflict as options and have learned how to use approaches and tools to turn conflict into productive business success. Here, the best idea wins. This team knows

M AY 2014

how to do the work to make a decision the team more enthusiastically supports. The thinking here produces a decidedly better decision with decidedly better buy-in and support. Productive collaboration, then, requires both an effective decision and cooperative support (buy-in). Common behaviors that do not help are: Avoidance: The team member does not want to influence either the decision or the buy-in. “Just make the decision so we can get out of here.” Accommodation: The team member has a strong need to be liked. “Whatever you say; I just want to do the best thing for the team.” Competition: Strong egos need to be right and keep control. “Everyone is entitled to my opinion!” Compromise: Although this is a higher-level response than the above three in that it usually requires some amount of discussion, it falls short of true collaboration. Team members may have a strong sense they’re missing something, but they are willing to end a meeting to reduce the frustration. “I can live with that … onto the next meeting.” When leaders have the skills to lead collaboratively, their ability to help their team work as a Type 3 will pay high dividends. At this point, they demonstrate the most effective behavior: INBUSINE SSMAG.COM

BOOKS Collaboration: The team has deep dialogue, a very interactive conversation that helps everyone communicate and learn. “Best idea wins!” The look of Type 1 and 2 meetings can often be described as what Michael Schrage, a fellow at MIT’s prestigious Sloan School of Management, calls BOPSAT (Bunch of People Sitting Around Talking). The topic and decision move around the table like a hot potato, moving around the table randomly based on the most recent random question or point. The look of Type 3 meetings is quite different. These meetings use “tools” to guide the team’s thinking — not telling anyone what to think, but how. These tools are, fundamentally, great questions. One of my favorite collaboration tools is Edward de Bono’s Six Thinking Hats. Before a team is ready to make a decision, they must determine what they want to do. They must learn more about the situation and options before they can make a decision they all support. With Six Thinking Hats, the team is asked to use six types of thinking (six kinds of questions) in a sequence to walk around a potential decision before it is made. Each metaphorical “hat” represents one of those six ways of thinking. The team, wearing an imaginary White Hat, focuses on factual information; the Red Hat, on emotions and intuition; the Yellow Hat, on positive perspective; the Black Hat, on caution and risk; the Green Hat, on creativity; and the Blue Hat, on control, overview, and organization. Using this tool correctly, everyone wears the same hat at the same time, for the same period of time. This not only suspends judgment until the decision is ready to be made, it also leads the team through six useful steps that help the team understand the options and possible consequences of deciding one way or another. The hats, like other productive Type 3 tools, help team members narrow down the best ideas in a very productive and cooperative way. An organization’s success depends on the number of great decisions, based on great ideas, implemented throughout the organization by leaders and employees. Meeting participants who have other points of view often resist these decisions. With the different points of view, there is disagreement. Some call this disagreement “conflict.” I call this disagreement “opportunity.” While there are a number of kinds of conflict, some of which (interpersonal, for example) may be harder to address, conflict can lead to a change in thinking and thereby be the source of business success. It is helpful to consider that where there is disagreement and conflict, there also are alternatives — different ways to solve a problem, design a widget or make a decision. Having alternatives is a good thing — a great thing, even. What’s often missing is the team’s skill in knowing how to deal with the conflict, how to deal with the options, how to deliberately and objectively discuss all the alternatives and then decide. Playing “nice” — allowing teams to operate as types 1 and 2 — generates weak decisions and weak buy-in. That is no way to run a productive and profitable business. It’s time to say goodbye to “go along to get along.” John Canfield is author of The Good Thinking Series. As a corporate coach (www.johncanfield.com) offering practical tools for strategic planning, collaboration and innovation, he has more than 30 years of experience working and consulting for organizations around the world.

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PERSONAL IMPROVEMENT

Power Cues: The Subtle Science of Leading Groups, Persuading Others, and Maximizing Your Personal Impact IN THIS PROVOCATIVE yet practical book, communication expert Nick Morgan highlights recent research that shows how humans are programmed to respond to the nonverbal cues of others — subtle gestures, sounds and signals — that elicit emotion, and provides a clear, useful framework of seven “power cues” that will be essential for any leader. Readers will learn crucial skills, from measuring nonverbal signs of confidence, to understanding their own “gut” reactions. This concise and engaging guide will help leaders and aspiring leaders of all stripes to connect powerfully, communicate more effectively, and command influence. Nick Morgan $25 • Harvard Business Review Press • On shelves and online

The Etiquette Advantage in Business, Third Edition: Personal Skills for Professional Success COMPLETELY REVISED AND updated, this edition is the ultimate guide professionals need to build successful business relationships with confidence. Good manners mean good business.This book offers proven, essential advice, from resolving conflicts with ease and grace to building productive relationships with colleagues at all levels. It also offers up-to-date guidance on important professional skills, including ethics, social media do’s and don’ts, and knowing how and when to take responsibility for mistakes. For the first time in business history, four distinct generations inhabit the workplace at the same time, leading to generational differences that can cause significant tensions and relationship problems. Peter Post, Anna Post, Lizzie Post and Daniel Post Senning $30 • HarperCollins Publishers • On shelves and online

Leadership Blindspots: How Successful Leaders Identify and Overcome the Weaknesses That Matter LEADERSHIP BLINDSPOTS IS packed with detailed case studies examining how blind spots operate, using examples from firms like Apple, Amazon, Hewlett-Packard, JC Penney and JPMorgan Chase. These cases show how a leader’s blind spots can lead to devastating mistakes if they aren’t recognized and acted upon. Author Robert Bruce Shaw examines the most common types of blind spots and provides worksheets and assessment tools to help individuals at all levels of a company avoid being blindsided by weaknesses and threats that they don’t see or fully understand. Robert Bruce Shaw $34 • John Wiley & Sons, Inc. • On shelves and online

M AY 2014

TRICKLE UP

A VIEW FROM THE TOP

Dr. Audrey C. Menard: Keeping Command of Campus Prep school headmaster runs school like a business AS THE NEW Head of School for Rancho Solano Preparatory School, Audrey C. Menard, Ed.D., credits delegating and collaborating as two keys to her success. She does this, she explains, by creating teams of employees with various strengths to handle different responsibilities. Also, by remembering that she runs a business — albeit one that emphasizes creating outstanding students rather than a traditional product — Dr. Menard keeps her priorities in order to make sure the school produces students “ready for the world.” Dr. Menard took the helm of the Scottsdalebased private school in June 2013. Rancho Solano, which offers an advanced and highly personalized curriculum for pre-kindergarten through 12th grade, currently has 1,100 students enrolled and 150 employees. The school has four campuses – one in Gilbert, one in Peoria and two in Scottsdale – but will be consolidating them to the two in Scottsdale at the end of this school year. Keeping the

campuses running smoothly and working closely with staff and students, she wears a variety of “hats” but follows a uniform approach. “I’m a delegator,” she says. “I see the forest; I let others work on the trees. It helps me not get mired.” The Meritas Family of Schools, which owns 10 schools around the globe, had purchased Rancho Solano in 2007 from the family that started the school six decades ago. In order to build momentum under her leadership, Dr. Menard initiated a strategic planning process that allowed her and other stakeholders connected with the school to “work together to assess the lay of the land” and determine the school’s path moving forward. This reflects another effective approach Dr. Menard employs — working closely with the school community to set the course of the school going forward. Dr. Menard worked with strategic planning experts that helped assist with focus groups and analyze student, staff and parent priorities. “I hired an internationally recognized organization for the sake of transparency, but also because one of my strengths is collaboration,” Menard says, noting the focus groups were made up of teachers, community members and students. “The students are the ones who live it every day, so I wanted them to be included.” This collaborative effort developed a new

Extra Curricular

■■ Dr. Menard became Head of School at Rancho Solano in June 2013, after serving as Principal at St. Thomas More Catholic High School in Lafayette, La. ■■ Dr. Menard has an M.Ed. in educational administration from the University of ■■ ■■ ■■ 28

Massachusetts, and completed her doctorate in education leadership, policy and organization at Vanderbilt University. Prior to coming to Arizona, Dr. Menard received a $1.3-million grant, which allowed her to launch an internationally recognized one-to-one tablet computer initiative at her previous school in Louisiana. Rancho Solano is a leading private school in Arizona offering an advanced and highly personalized PK-12 curriculum. The school has 1,100 students enrolled and 150 employees; consolidating from four campuses to two as of July 2014, it will offer grades PK-5 at its Greenway campus and 6-12 at its new Via de Ventura campus. Opened last year, the new campus on Via de Ventura has a state-of-the-art 25,000-square-foot athletic complex and student center. The center won the Engineering News-Record Best K-12 Education Project award.

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mission for the school, Dr. Menard says: cultivating in the students the ingenuity to thrive in a global society and to be architects of their future. “The big challenge is changing who we are, and shifting our school from an old mission to this new one. We’re in a different niche now, and so in order to be the top school in the Valley, we are embedding into the curriculum, intentionally, softer skills, such as communication, critical thinking, teamwork, cultural sophistication and comfort with ambiguity.” From the information shared in the focus groups and strategic planning process, Dr. Menard says many opportunities have “bubbled up” that have helped her to prioritize what needs to be done at the school and align the students’ learning experience with the school’s overall strategic objectives. Keeping the lines of communication open with staff also has benefited Dr. Menard throughout her career in education. She spends a lot of time talking to teachers, and visits their classrooms on a regular basis. Because of this, she knows and understands teachers’ successes and challenges, as well as the students’ daily experience. As her first year at Rancho Solano comes to a close, Dr. Menard admits that working long hours has been challenging. To get through the late nights and weekends filled with work, she reminds herself that, in addition to vision, steering transitions takes time and patience. “It’s like drinking through a fire hose,” she says, “but I know that this is a normal process and there is light at the end of a very long tunnel.” Rancho Solano Preparatory School ranchosolano.com

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Photos courtesy of Rancho Solano Preparatory School

by Alison Stanton

by RaeAnne Marsh

WWW.INBUSINESSMAG.COM

May 2014

ON THE AGENDA

A listing of Greater Phoenix business organizations and their events. Visit www.inbusinessmag.com for an expanded monthly calendar of educational, networking and special business events.

Greater Phoenix Chamber of Commerce

Mountain States Employers Council

27th Annual IMPACT Awards

Employment Law Update Conference

Thurs., May 15 — 11:00a – 1:30p

Tues., June 3 — 8:30a – 4:30p

FOR 27 YEARS, the Greater Phoenix Chamber of Commerce has honored Valley companies as being the top in business. For 2014 IMPACT Awards nominees this prestigious event, being held at the Arizona Biltmore Hotel, the winners of the IMPACT Awards are not simply named, but each nominee goes through a series of obligations that include an extensive written form and an interview by the selection panel made up of Chamber board members and member companies. There are four awards in each of two categories. In the Small to Medium Business category (companies of 250 employees or fewer), businesses being recognized are: 2014 Community Champion — Native American Connections; 2014 Economic Driver — Translational Genomics Research Institute (TGen); 2014 Entrepreneurial Excellence — Risas Dental and Braces; and 2014 Response to Adversity — NJOY, Inc. Recognitions in the Large Business category (companies with more than 250 employees) go to: 2014 Community Champion — Phoenix Children’s Hospital; 2014 Economic Driver — Sundt Construction, Inc.; 2014 Entrepreneurial Excellence — The CORE Institute; and 2014 Response to Adversity — Phoenix Zoo. And for the fourth consecutive year, the Greater Phoenix Chamber of Commerce will honor three elected officials with the Sentinel Award for their willingness to champion efforts that ensure Arizona’s business climate is healthy and competitive. This year’s recipients are Arizona Governor Jan Brewer, Arizona State Representative Heather Carter and Phoenix City Councilman Jim Waring. Tickets are $75 for GPCC members and $85 for nonmembers; tables of 10 are $850 for GPCC members and $950 for non-members.

MOUNTAIN STATES EMPLOYMENT Council’s annual Employment Law Update conference, being held at the Scottsdale Resort & Conference Center, is aimed at “anyone who touches the HR world in an organization,” says Lorie Birk, Arizona vice president for membership Jennifer Ward services. For business owners, CEOs, HR professionals, heads of divisions, even line managers, the full-day conference will cover what’s happened over the past year, such as what Birk refers to as “a significant case regarding confidential agreements” and changes in leaves of absence. “There’s a lot going on in the alphabet soup of employment law,” Birk says. Dave Smith Presentations by the Council’s attorneys will provide practical, timely and critical advice to help employers minimize potential employment law liability, in straightforward, non-“legalese” language. Scheduled presentations include “Case, Legislative and Regulatory Update: Staying Ahead of the Curve” with Jennifer Ward and “Negligent Hiring or Employment Discrimination: Threading the Needle after the EEOC Guidance” with Dave Smith, both attorneys in MSEC’s local Scottsdale office; “#ValuesInAction: Leading in Changing Corporate Cultures”; “Miranda Warning for Employers: Supervisor’s Words and Actions Can Be Held Against You”; “Litigation Loves a Vacuum: Directing Your Workplace Investigations with Purpose”; “PDA + ADAAA + SEP = The Expanding Zone of Workplace Accommodations”; and “Workforce Misclassifications: Prepare Now for Agency Audits.” At the end of the day, all presenters will take part in a panel discussion. Registration is $149 per person; $109 per person for groups of at least three from the same organization.

Photo courtesy of Jay Mark

Greater Phoenix Chamber of Commerce

phoenixchamber.com

Mountain States Employers Council msec.org

Notable Dates This Month Sun., May. 11 Mother’s Day Tues., May. 20

Armed Forces Day

Mon., May. 26

Memorial Day

Agenda events are submitted by the organizations and are subject to change. Please check with the organization to ensure accuracy. See more events online at www.inbusinessmag.com.

WANT TO CUT ENERGY COSTS? THINK SRP REBATES. savewithsrpbiz.com INBUSINE SSMAG.COM

M AY 2014

ON THE AGENDA ASSOCIATION FOR CORPORATE GROWTH – ARIZONA 2014 Southwest Mergers & Acquisitions Conference Wed. & Thurs., May 14 & 15 All day

Learn about the current state of affairs and trends from leaders in merger and acquisition community. Members: $310; non-members: $410; at the door: add $55 Fairmont Scottsdale Princess Resort 7575 E. Princess Dr., Scottsdale acg.org/arizona

MAY 2014

Scottsdale Princess Resort & Conference Center 7575 E. Princess Dr., Scottsdale (602) 306-4000

CENTRAL PHOENIX WOMEN

Women’s Biz Connection

Presentation by James Eggimann from the Ritz Carlton Leadership Center. $35 The Ritz-Carlton Phoenix 2401 E. Camelback Rd., Phoenix centralphoenixwomen.org

Wed., May 14 3:00p – 4:30p

Women’s Biz Connection provides an opportunity for women business owners to come together and build supportive relationships. Free ASBA’s Business Education Center 4600 E. Washington St., Phoenix Victoria Trafton, vt@victoriatrafton.com

AHWATUKEE FOOTHILLS CHAMBER OF COMMERCE

ARIZONA TECHNOLOGY COUNCIL

Free One-on-One Business Counseling with SCORE

Wed., May 7 12:30p – 6:30p

Thursdays, May 1 & 15 9:00a – noon, appointment only

Free Ahwatukee Chamber of Commerce 4435 E. Chandler Blvd., Phoenix (480) 753-7676

ARIZONA CHAMBER OF COMMERCE AND INDUSTRY Manufacturer of the Year Summit & Awards Luncheon Wed., May 14 9:00a – 1:45p

Morning summit features a tradeshow and panel discussions on the latest issues of concern for Arizona manufacturers followed by awards luncheon. Members: $45; non-members: $60 Sheraton Phoenix Downtown Hotel 340 N. 3rd St., Phoenix azchamber.chambermaster.com

ARIZONA HISPANIC CHAMBER OF COMMERCE 56th Annual Black & White Ball and Business Awards Sat., May 3 6:00p – midnight

This year’s “Noche de Garibaldi” theme is inspired by Plaza Garibaldi in Mexico City, known around the world as the home of Mariachi music. Members: $300; non-members: $400 Talking Stick Resort 9800 E. Indian Bend Rd., Scottsdale azhcc.com

ARIZONA SMALL BUSINESS ASSOCIATION AZ Small Biz Con Wed., May 7 8:30a – 5:00p

Full day of classes on topics helpful to businesspeople. Includes breakfast, awards luncheon, expo and networking mixer. $229

M AY 2014

Cybersecurity Summit The Cybersecurity Summit is an opportunity for government and business executives to learn about the threats, vulnerabilities, and consequences related to data security and privacy matters. There will be a panel discussion, keynote speaker, sponsor expo and other great presentations. Members: $40; non-members: $60 Hilton Scottsdale Resort & Villas 6333 N. Scottsdale Rd., Scottsdale (602) 343-8324

Lunch and Learn Thurs., May 8 11:30a – 1:00p

“Lies, Myths and Stereotypes”: It’s no secret that men and women communicate differently, but did you know that the majority of conflict in the workplace is due to miscommunication? Members: free; non-members: $15 Eller College of Management, Quicken Loans building 16425 N. Pima Rd., Scottsdale (602) 343-8324

Lunch and Learn Tues., May 13 11:30a – 1:00p

“Stop Selling… Help Your Customer Buy”: If the business is unable to differentiate their value and the sales effort is nothing but a “cost” of doing business… well, you get the picture. Members: free; non-members: $15 ASU SkySong 1475 N. Scottsdale Rd., Scottsdale (602) 343-8324

Council Connect Wed., May 21 11:30a – 1:30p

“Innovations in Healthcare – Telehealth,” presented by AmeriVitals (formerly DialNurse). Members: $35; non-members: $55; register in advance Blanco, Tacos + Tequila Biltmore Fashion Park 2502 E. Camelback Rd., Phoenix (602) 343-8324

Afternoon Tea Tues., May 6 3:30p – 5:30p

CHANDLER CHAMBER OF COMMERCE

27th Annual Community Awards Dinner Thurs., May 29 5:30p – 8:30p

An opportunity to recognize outstanding businesses of all sizes, as well as educators and administrators who have demonstrated leadership and exemplified commitment. Members: $50; non-members: $60 Wild Horse Pass Hotel & Casino 5040 Wild Horse Pass Blvd., Chandler chandlerchamber.com

ECONOMIC CLUB OF PHOENIX

What’s Trending in Business?

Annual Economic Outlook Luncheon

Free, but please pre-register Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler info@chandlerchamber.com

Speakers from the W. P. Carey School of Business will discuss Arizona’s economy, the national economy and its implications for the state. Introductory members: $60; nonmembers: $75 Arizona Biltmore 2400 E. Missouri Ave., Phoenix econclubphx.org

Fri., May 2 8:45a – 10:30a

Small Business Development Center Academy Classes Tuesdays, May 6, 13 & 20 4:00p – 6:00p

Highly acclaimed workshop series to help businesses build the essential skills to be more effective and improve their bottom line. Attend six or more workshops and receive a certificate as Academy Graduate. Free Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler info@chandlerchamber.com

Technology Lunch Seminar Series Thurs., May 8 11:30a – 1:00p

Kameron Williams from LilliMedia will discuss mobile marketing and responsive websites. Free; please RSVP Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler info@chandlerchamber.com

Small Business Development Center Start-Up Lab Tues., May 20 2:00p – 3:00p

SBDC provides the tools and resources to help serious future business owners launch or relaunch a small business in Arizona. Free Chandler Chamber of Commerce 25 S. Arizona Pl., Chandler info@chandlerchamber.com

Women in Business Tues., May 20 10:45a – 1:30p

Technology, marketing, sales, accounting, legal issues are just a few of topics to be covered in the workshop sessions, with lunch at noon. Members: $25; guests: $35 SoHo63 63 E. Boston, Chandler chandlerchamber.com

Thurs., May 8 11:30a – 1:30p

GLOBAL CHAMBER VerdeXchange Arizona Conference Thurs. & Fri., May 1 & 2 8:00a – 3:00p (Thurs.) 8:00a – 5:00p (Fri.)

Connect with hundreds of dreamers and doers creating a sustainable future of growth for Arizona and the West. VerdeXchange’s two-day conference is designed to create new connections and allow businesses to tap into new opportunities. $345 for all events; individual day and event registration also available Sheraton Phoenix Downtown Hotel, Valley of the Sun Ballroom 340 N. 3rd St., Phoenix vxarizona.com

“Cinco de Global” Mon., May 5 7:30a – 9:00a

Event by Arizona International Growth Group will be discussing globalization and growing “outside the borders.” $20; at the door: $25 ASU SkySong 1475 N. Scottsdale Rd., Scottsdale growthnation.com

GREATER PHOENIX CHAMBER OF COMMERCE 27th Annual IMPACT Awards Luncheon Thurs., May 15 11:00a – 1:30p

Annual celebration of achievement, perseverance and community service. Members: $75; non-members: $85 Arizona Biltmore 2400 E. Missouri Ave., Phoenix (602) 495-2182 (See article on page 29.)

INBUSINE SSMAG.COM

Please confirm, as dates & times are subject to change.

NATIONAL ASSOCIATION OF WOMEN BUSINESS OWNERS NAWBO University Wed., May 14 9:30a – 11:00a

“Your Website is a Beehive!”: how to make your website the center of your marketing efforts, presented by Dorothy Wolden of Gravity Web + Design. Members: free; non-members: $30 Phoenix Country Club 2901 N. 7th St., Phoenix nawbophx.org

Luncheon

Wed., May 14 11:00a – 1:00pm

“The Power of Social Media for Your Business”: three roundtables where professionals will share strategies, ideas and success stories. Members: $38; non-members: $48; after May 9: add $15 Phoenix Country Club 2901 N. 7th St., Phoenix nawbophx.org

PEORIA CHAMBER OF COMMERCE B-Smart Seminar: Marketing on Facebook Thurs., May 1 9:00a – 11:00a

Workshop on how to market your business on Facebook.

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Members: $27; non-members: $47 Peoria Chamber of Commerce 16165 N. 83rd Ave., Peoria (623) 979-3601

Networking Mixer at Toby Keith’s Wed., May 21 5:30p – 6:30p

Connecting the Chamber and community. Free, open to the public Toby Keith’s I Love This Bar & Grill 9824 W. Northern Ave., Peoria peoriachamber.com

SCOTTSDALE AREA CHAMBER OF COMMERCE Los Tres Amigos Mixer Thurs., May 1 5:00p – 7:00p

This joint mixer of the Scottsdale Area Chamber of Commerce, the Greater Phoenix Chamber of Commerce and the Tempe Chamber of Commerce features complimentary cuisine, a cash bar and live entertainment. Free The Phoenix Zoo 455 N. Galvin Pkwy., Phoenix Nikki Hoffman, nhoffman@scottsdalechamber.com

Business Owners Forum Fri., May 9 8:00a – 9:00a

Free

Scottsdale Area Chamber of Commerce 7501 E. McCormick Pkwy., Scottsdale Kelly Rich, krich@scottsdalechamber.com

TEMPE CHAMBER OF COMMERCE 19th Annual Women in Business Conference Wed., May 21 8:00a – 1:30p

A trade show provides the backdrop to a luncheon and presentations by powerful keynote speakers. Members: $65; general public: $99 PERA Club 1 E. Continental Dr., Tempe Sachiyo Spires, sachiyo@tempechamber.org

Business After Hours Wed., May 28 5:30p – 7:00p

Members: free; general public: $10 Tilted Kilt 660 W. Warner Rd., Tempe Sachiyo Spires, sachiyo@tempechamber.org

OTHER BUSINESS EVENTS Lifecycle Marketing Training for Small Business Tues., May 13 8:30a – 4:30p

The Arizona Commerce Authority is partnering with Infusionsoft to provide a full day of training focused on creating and refining a sales and marketing strategy for your business.

$100 Infusionsoft 1260 S. Spectrum Blvd., Chandler azcommerce.com

Luncheon to Discuss Developmental Projects Tues., May 13 11:30a – 1:30p

Arizona Association for Economic Development’s luncheon presents a panel of real estate development experts: Scott Whyte, economic development services director for the City of Peoria; Mike Ebert, a principal with RED Development; Jeffrey H. Tamkin, president of Public Facilities Investment Corp.; and Christine Mackay, economic development director for the City of Chandler. AAED members and their guests: $40; non-members: $50; late registrants: $55 Phoenix Country Club 2901 N. 7th St., Phoenix aaed.com

Employment Law Update Conference Tues., June 3 8:30a – 4:40p

Mountain States Employers Council conference presents information on the most significant employment law developments of the year. $149; group rate: $109 per person Scottsdale Resort & Conference Center 7700 E. McCormick Pkwy., Scottsdale msec.org (See article on page 29.)

M AY 2014

LEGAL

LEGAL MATTERS TO BUSINESS

Drugs and Work Safety Liability Use rights and impairment issues may collide by RaeAnne Marsh DRUG AND ALCOHOL abuse costs business multiple billions of dollars in workers’ comp accidents, increased healthcare costs and productivity, including theft to fund the habit. Says Julie Pace, partner at The Cavanagh Law Firm, “There are all kinds of reasons why employers should care about having a good drug and alcohol policy, making sure they test on it, [because of] its impact on the workplace and the bottom line.” The recent passage of the Arizona Medical Marijuana Act has initiated a lot of attention on workplace impact and employer response. Although several states around the country have enacted medical marijuana statutes, Arizona is one of only two that have a specific provision protecting the employment rights of medical marijuana card holders. The basic provisions are an employer cannot terminate an employee for being a medical marijuana card holder and, if an employee tests positive for marijuana, an employer cannot fire that employee unless there is some other evidence of impairment. This creates a dilemma for the employer, explains Mike Moberly, shareholder at Ryley Carlock & Applewhite. Employers face liability if an employee causes an accident but also face potential discrimination charges if they take employment action against what is now a protected class. “There’s some talk of doing away with testing for marijuana,” Moberly says. “If an employee does cause an accident and the employer had evidence that the employee was a user and didn’t act on it, there could be action by the third party against the employer and probably the employee.” In the mix of issues arising from the Medical Marijuana Act is the fact that marijuana is still illegal under federal law. “The federal justice system tends to be acquiescent to state laws,” Moberly says, “There are all kinds of reasons “but there is the federal preemption issue why employers should care — so if an employer violated an employee’s about having a good drug and rights under the state’s marijuana law, he alcohol policy, making sure might, potentially, have a defense because

Arizona has had a law since 1994 to protect the employer from liability for unemployment benefits or job termination based on a positive drug or alcohol test. Pace, who, with colleague Dave Seldon, helped get that law adopted, says that was when employers started putting detailed drug and alcohol policies in place. These commonly have three parts: pre-employment testing (for drugs only) and random testing for drugs and alcohol after employment; automatic testing following an accident; and reasonable suspicion drug testing, when a manager has a suspicion that an employee is impaired. While fellow employees may communicate a concern that an employee is impaired, Pace suggests the recommendation to test come from additional observation by a supervisor. Safety-sensitive positions are in a different category. In fact, the Department of Transportation has specialized rules for drivers. Pace says she and Seldon drafted an amendment to the 1994 law in 2011, right after passage of the medical marijuana law, adding a provision regarding employers designating positions that are safety sensitive and it’s still illegal under federal law.” they test on it, [because of] its allowing them to act on a drug test for such positions as long as it is done in good faith. This covers use of drugs while on work premises and A complicating factor in testing for impact on the workplace and during the hours of work. And, Pace notes, this covers all types of drugs. marijuana use is the most common test the bottom line.” Although marijuana is the hot-button topic right now, Pace emphasizes does not test current impairment. Not —Julie Pace that she has found the biggest issues at work to be with prescription drugs. only does it register a positive result as “People abuse them and are truly impaired, but employers and employees much as 30 days after marijuana use, but, don’t treat them the same [as illegal drugs].” In fact, she points out, an Moberly points out, unlike alcohol level, there is no universally accepted employee may even send an inter-office email saying, for instance, “I standard as to what level of metabolites in a person’s system is impairing. forgot my medicine; can someone share theirs with me?” This constitutes While the law prohibits an employer from assuming there is illegal sharing of drugs, as a prescription is given to a specific person. impairment just because an employee holds a medical marijuana card, Pace suggests employers have a comprehensive drug and alcohol the law does not prohibit an employer from taking action if there is policy and spell out that information in the employee handbook. Items visual evidence of impairment in the workplace — irrespective of to include are a drug and alcohol testing acknowledgment form, a check whether or not the marijuana use was done during the employee’s list for “reasonable suspicion testing,” and a list of positions designated off-work hours. One strategy in dealing with suspected or observed as safety sensitive. impairment is to try to find another position for the employee, says Moberly, although he admits “that’s easier said than done” because The Cavenagh Law Firm cavanaghlaw.com people are qualified for one job but not necessarily for another. Ryley Carlock & Applewhite rcalaw.com

M AY 2014

INBUSINE SSMAG.COM

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• How many different types of value are there and which are most important to me? • What components drive value? • What is the difference between an “asset sale” and a “stock sale”? • How does my company compare to others in the same industry in terms of key performance indicators involving liquidity, solvency, activity and profitability? At Beyer Management we’re passionate about Value Based Management. We find that when a business owner focuses on increasing the value of their company, they will naturally design the right strategies, implement the proper business model, and execute the best tactics to beat the competition and build a long term sustainable enterprise.

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M AY 2014

ASSETS

by Mike Hunter

WE VALUE WHAT WE OWN

2015 Jaguar F-Type R Is Power THE FASTEST CAR ever developed from Jaguar, this 2015 F-Type is a road master with a roar that demonstrates the power of this sports car. The 5.0-liter, 550-horsepower, V-8 supercharged engine is at the core of this machine. With its astonishing torque of 502 lb-ft, it is no wonder that this supercharged and intercooled DOHC 32-valve, V-8, aluminum-block-and-heads, direct-fuel-injection engine boasts impressive zero to 60 in 3.5 seconds. This high-performance vehicle is met with precision braking, a sturdy and responsive experience behind the wheel and some impressive options, making this F-Type the envy of Ferrari and Porsche enthusiasts. With the car’s top speed of 186 mph, the Jaguar Super Performance Braking system with red calipers is designed to keep control at high speeds, benefitting from the sport suspension with Adaptive Dynamics to maintain comfort and reliability. The switchable Active Support Exhaust with quad exhaust pipes looks strong and sounds even stronger. Maybe a bit too brazen, this “roar from behind” offers a meanness that Jaguar clearly is making a statement in returning to the powerful machines it became so famous for in the ’60s. The curves and the stance of this F-Type R are truly a sight to behold. The all-new rear is sleek and substantive while the curved glass top brings sporty lines and incorporates the outside with the cabin. The performance seats with leather facings and the “R” embossing look sporty and reminiscent of the racing model influences that make this Jaguar the most impressive ever. The coupe two-door style is tight and roomy at the same time. Configured to “hug” the driver during “more enthusiastic driving,” this power piece is built to perform. The dark “technical” weave aluminum console trim with “R” graphic is enhanced by the configurable ambient interior lighting that includes a selectable palette. Dual zone climate control with the optional Climate Pack includes heated seats and steering wheel. The Meridian 770W Audio System allows for 2015 Jaguar F-Type R those escapable moments and can even drown City MPG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 out the roar of the engines if so desired. Hwy MPG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 0-60 MPH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.5 sec Transmission. . . . . . . . . . . . . . . 8-speed automatic MSRP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $99,895

Jaguar jaguarusa.com

Update Your Space WE LIVE IN our offices, so why not focus on the environment to bring success? Comfort and impressive design will make work space more inviting and can make the workday a pleasure.

Plant the Environment

Custom silk or live plants will make the working space feel inviting. Innovative “plantscape” design is what Plantender of Arizona offers to brighten up the office, lobby space or break rooms. Family-owned and family-operated for more than 30 years, this local company will design and provide ongoing maintenance services will that will keep the office green. plantenderofaz.com

Paint for Success

Adding a quality coat of paint will liven up the work space and impress the clients. Dunn Edwards’ Perfect Palette® color system offers 1,696 ways to express one’s vision and a variety of tools make it easy to pick one’s best color to success. dunnedwards.com

Developing the perfect space includes the perfect lighting. Lighting Unlimited is a family-owned, local company that advises as to the best products, workspace lighting and energy use. Lighting design or just choosing the right light bulbs will brighten the work space and enhance the environment. Four Valley locations. lu-az.com

M AY 2014

INBUSINE SSMAG.COM

Photos courtesy of Land Rove/Jaguar (left), Dunn Edwards (right middle)

Light It Up

by Mike Hunter

MEALS THAT MATTER

POWER LUNCH

Let’s Meet for Coffee DOING THE QUICK morning (or afternoon) meeting at a local coffee house has become a standard in doing business. With Wi-Fi, small food offerings and convenience to nearly every business hub in the Valley, these make our list of some top local “business-friendly” coffee spots.

Copper Star Coffee

Housed in an old gas station, this spot has been rigged to appeal to the small, impromptu meeting. Great service and plenty of indoor and outdoor space make this unique coffee house a hub in the Melrose district. Its locally roasted coffee and baked-fresh pastries may make this a better morning meeting option. 4220 N. 7th Ave., Phoenix (602) 266-2136 • copperstarcoffee.com

Lux Coffee Bar

This is a quaint coffee spot that gets crowded but serves up amazing coffee, treats and small meals. The living roomstyle urban modern appeal has made this a comfort zone for downtowners and a great meeting space (mostly in the off hours). 4402 N. Central Ave., Phoenix (602) 327-1396 • luxcoffee.com

Urban Beans

Photos courtesy of SOL Cocina Scottsdale (left)

Living up to its name, this urban coffee house serves up incredibly flavorful, rich coffee and has a very nice breakfast and lunch “small plates” menu. It has both indoor and outdoor seating; meetings here are not too private, but are rich in atmosphere and flavor. 3508 N. 7th St., Phoenix (602) 595-2244 • urbanbeans.com

Get Me Some SOL

SIMPLE, FRESH AND made with a modern interpretation is how to describe the exciting SOL Cocina. This vibrant Mexican eatery located in the Scottsdale Quarter is an energetic hub celebrating the Baja, Mexico, tradition with food, drink and even music. For lunch, enjoy this cultural hot spot that offers a great menu and terrific, speedy service in an atmosphere that denotes a sophisticated Baja “open kitchen” design. Using the freshest seasonal ingredients, all sauces and salsas are made fresh daily. The lunch menu is a brief version of the dinner menu with many “smaller” dishes offering a taste of the traditions that has made Mexican (Baja in particular) food a great option for lunch. Start off with the Naked Guacamole, made as naturally as can be with Haas avocados, lime, cilantro, onion, Serrano chile and tomato — among other versions of the guacamole options. Some of the other starter dishes offer Baja classics like ceviche, peel-and-eat shrimp and panuchos. The taco combos are a “grande” part of this menu, with more than eight options that include the Ensenada-style Fish Taco made with pico de gallo and cabbage smothered in a creamy lime sauce. The simple Carne Asada Street Taco, classic Carnitas Street Taco and the Battered Shrimp Taco are among the most well-known (and delicious). A Sweet Potato and Black Bean taco is an unexpected favorite with a different twist; so flavorful, it is made with caramelized onion, poblano chili, Mexican cheese and chipotle sauce. The Sloppy Jose is a Tortas made with pork carnitas, sliced avocado, onion, cilantro and chicharron. The menu includes some exotic and tropical salads and the flavorful Tortilla Soup with Chicken. A celebratory atmosphere adds to the great flavors of this authentic Mexican-inspired restaurant set in the new, urban Scottsdale Quarter. A very comfortable patio and chic design make this Scottsdale Mexican restaurant a great choice for lunch. Catering and private events are available with some great spaces and inventive menus. A nighttime hotspot as well, this place can be packed like a nightclub as it boasts live music and an extensive drink menu. SOL Cocina Scottsdale 15323 N. Scottsdale Rd., Scottsdale (480) 245-6708 solcocina.com

INBUSINE SSMAG.COM

M AY 2014

PRESENTS

COMMERCIAL REAL ESTATE SPOTLIGHT ON THE BEST Cassidy Turley Commercial Properties Inc. Colliers International Cushman Wakefield JLL NAI Horizon

C O M M E R C I A L R E A L E S TAT E SPOTLIGHT ON THE BEST

ACTION IN THE VALLEY’S COMMERCIAL REAL ESTATE MARKET DIFFERENT TRENDS ARE AT PLAY IN THE VARIOUS COMMERCIAL SECTORS By RaeAnne Marsh In the office market, Metro Phoenix led the nation with a 3.9-percent increase in asking rents from the end of 2013 to the end of the first quarter of 2014. This has occurred while vacancy rates have remained flat, says Craig Henig, senior managing director of the CBRE Phoenix office. The reason? “Large blocks of space are in short supply,” he says. There is both speculative and build-to-suit activity. Spec is being led by the Allred Corporation, building a 1.3-million-squarefoot distribution center on Chandler’s Price Road Corridor. Naming the GoDaddy project as the largest build-to-suit and two for Wells Fargo as also among the largest of the office projects, Henig says an influx of technology and finance companies has resulted in increased leasing and construction in the Southeast Valley. Tyler Wilson, vice president of the Office Services Group in Cassidy Turley’s Phoenix office, predicts Chandler, Tempe and Central/South Scottsdale will be the most active submarkets. “The South Loop 101 has seen the greatest focus of activity. We are seeing lots of interest in projects such as the Discovery Business Center, ASU Research Park and then properties all along the Price Road Corridor. In Chandler, the most active product type is back office and call center. In Tempe, it is headquarter spaces and back office. Scottsdale is mostly seeing ‘creative’ requirements, Millennial requirements and technology.” Space requirements are changing due to a change in the way people work. Says Henig, “More companies are looking at the way employees collaborate together, wellness and efficiency. So companies gravitate toward more of a collaborative,

A new, 80-acre, master-planned bulk-distribution park expected to break ground this year, 10 West Logistics Center, is being devleoped by Wentworth Property Company at 59th Avenue and Van Buren and will consist of more than 1.3 million square feet of space

creative work environment.” As they move away from a lot of private offices, and go paperless and therefore have less call for file cabinets, tenants don’t need as much space as they used to. Another trend impacting the office market, Wilson observes, is the growing importance of area amenities as a factor in location decisions as companies consider employee attraction and retention issues. Retail is likely to see little to no new construction, according to Cliff Johnston, managing director of Cassidy Turley’s Retail Services Group in Phoenix. “The abundance of vacant space and below-market rental rates will keep new construction at a relative halt until these factors are more in line with a typical, healthy retail market,” he says. However, Henig notes there was 1.6 million square feet of absorption in 2013, compared to negative absorption in 2009, ’10 and ’11. He sees an increase in adaptive reuse around the Valley as office space is converted to smaller retail centers or multifamily. And

retailers are adapting to a different footprint, he observes, crediting the change to the impact of e-commerce. “Retailers are more pragmatic in the way they lay out the stores and the product they’re carrying,” he says, explaining they will take a smaller space because they are flooring less product as instore purchasing patterns change. Another change Henig points to is retail not “following the rooftops” as it used to do, but rather trending to urban and infill sites. Johnston notes retail product attracting the most interest at this time is high-visibility, multi-tenant buildings fronting major thoroughfares. “These buildings provide for end-cap location with prominent signage directly to traffic and usually can accommodate outdoor patios for restaurants,” Johnston says, adding, “Fast-casual restaurants in the 1,800- to 3,000-square-foot size range are currently the most active retail tenants.” In the industrial sector, Metro Phoenix — as is true across the country — has seen a tightening of supply, “especially in highly

About this section: CO MM ERC IAL REA L ESTATE SPOTLIGHT ON THE

BEST

Cassidy Turley Cushman Wakefield NAI Horizon CPI JLL

As part of our service to our readers, our editorial staff has invited these top commercial real estate companies to provide information on themselves, their expertise and details relating to their business in this Commercial Real Estate: Spotlight on the Best special section. The real estate market is improving and these companies are proven leaders in the Valley.

Colliers

Please visit www.inbusinessmag.com for more information and articles on the local real estate market.

M AY 2014

Photo courtesy of Cassidy Turley

PRESENTS

INBUSINE SSMAG.COM

in Cassidy Turley’s Phoenix office, adding the demand also encompasses access to the metropolitan area’s major freeway systems as well as higher office finish. Of the Southwest Valley, Strong says activity has been somewhat quiet but he sees signs that there will be major users who will absorb some larger chunks of vacancy. “This is a user set focused on bulk-distribution buildings, needing access to Phoenix but who will also utilize the close geography to other major cities and the ability to be there in one day or less.” Much of the activity, he says, will involve businesses “wanting to compete with the major players with an existing e-commerce presence or who have been traditional retailers but are moving

toward online distribution.” Bulk-distribution buildings with a large footprint cater to these tenants, he says. Another hot product is higher-finish flex projects with a heavy parking ratio, which, he says, have been preleasing before construction completes. “This is a growing trend of tenants tapping into the abundance of skilled labor in Phoenix but needing building with heavier office, flexible infrastructure and parking to accommodate.” And spanning all sectors is a stretch of proposed development in the West Valley. “All sectors are watching the 303 Corridor,” says Henig. Cassidy Turley cassidyturley.com CBRE cbre.com

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Deer Valley Rd

Lone Mountain Rd

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Happy Valley Rd

Pinnacle Peak Rd

Beardsley Rd

Bl Happy Valley Rd

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Tom Darlington Dr

Desert Hills Dr

Joy Ranch Rd Cloud Rd

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Galvin Peak Pkwy

Hayden Rd

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competitive, big-box markets,” Henig says. This has led to increased construction of build-to-suit, especially among larger users, and speculative projects. The largest spec projects are Trammell Crow’s 618,000-square-foot industrial park around the Chandler Airport, scheduled to break ground this summer, and Hillwood Investment Properties’ 1.3-million-squarefoot distribution center on Phoenix’s west side, now in Phase I and scheduled for full completion by the end of this year. “The Sky Harbor Airport/Southeast Valley has been extremely active and will continue to see user demand looking for educated and skilled labor,” says Will Strong, vice president of the Industrial Services Group

M AY 2014

C O M M E R C I A L R E A L E S TAT E SPOTLIGHT ON THE BEST

CASSIDY TURLEY A LEADER IN COMMERCIAL REAL ESTATE SERVICES Cassidy Turley is a leading commercial real estate services provider with more than 4,000 professionals in more than 60 offices nationwide. With headquarters in Washington, D.C., the company represents a wide range of clients — from small businesses to Fortune 500 companies, from local nonprofits to major institutions. The firm completed transactions valued at $25.8 billion in 2013; manages approximately 400 million square feet on behalf of institutional, corporate and private clients; and supports more than 24,000 domestic corporate services locations. Cassidy Turley serves owners, investors and tenants with a full spectrum of integrated commercial real estate services — including capital markets, tenant representation, corporate services, project leasing, property management, project and development services, and research and consulting. Cassidy Turley enhances its global service delivery outside North America through a partnership with GVA, giving clients access to commercial real estate professionals in 65 international markets. At Cassidy Turley, we are market leaders, industry leaders and community leaders. Nationwide, we are recognized for our

M AY 2014

passionate client advocacy, as well as for the discipline and precision of our service delivery. We are a trusted partner, delivering client-centric solutions to enhance business performance. In markets across the country, we are respected as a leading provider of commercial real estate services as well as for our community engagement. Our thorough understanding of local business practices and market dynamics, combined with our customer focus and service commitment, give our clients a distinct edge in commercial real estate across the globe. Cassidy Turley provides regional services with its office in Phoenix. The firm has completed nearly $10.9 billion in transactions since 2003, including more than 1,000 transactions with a total consideration of nearly $1.1 billion in 2013. Cassidy Turley professionals provide their clients with unparalleled market knowledge, backed by the industry’s finest research, marketing, mapping and support services. Cassidy Turley professionals are committed to their community, and continue to give back through their work with industry and charitable organizations. Please visit www.cassidyturley.com or call 602.954.9000 for more information.

Riverpoint Building in Phoenix

PROFILE Company Name: Cassidy Turley Main Office Address: 2375 E. Camelback Road, Suite 300, Phoenix, AZ 85016 Phone: (602) 954-9000 Website: www.cassidyturley.com/arizona Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 70 City Nationally Headquartered: Washington, D.C. Managing Principal (Arizona): Bryon R. Carney No. of Years with Firm: 30 years Year Est. Locally: 1973 Specialties: Capital Markets, Project Leasing, Project & Development Services, Tenant Representation, Property Management

FINANCIAL: Property Sold in 2013 Value: $687 million Property Leased in 2013 Value: $408 million Commercial Transactions Closed in 2013: 1,011

INBUSINE SSMAG.COM

TOP PRODUCERS

2013

TOP PRODUCER Eric Wichterman TOP OVERALL PRODUCER TOP CAPITAL MARKETS

Jeff Wentworth Top Office

Brent Moser Top Land

Ryan Schubert Capital Markets

Michael Hackett Capital Markets

Mike Haenel Top Industrial

Andy Markham Top Industrial

Mike Beall Office

Chris Hollenbeck Top Retail

Bob Buckley Capital Markets

Steve Lindley Capital Markets

Tracy Cartledge Capital Markets

Sean Spellman Office

Mike Coover Capital Markets

Mike Sutton Land

Paul Boyle Capital Markets

Rick Danis Capital Markets

Brian Lee Industrial

Cliff Johnston Retail

John Appelbe Retail

David Fogler Capital Markets

Steven Nicoluzakis Capital Markets

Michael Kitlica Office

Capital Markets / Corporate Services / Project & Development Services Project Leasing / Property Management / Tenant Representation 2375 E. Camelback Road, Ste 300, Phoenix, AZ | 602.954.9000 | www.cassidyturley.com

C O M M E R C I A L R E A L E S TAT E SPOTLIGHT ON THE BEST

CUSHMAN & WAKEFIELD

The Cushman & Wakefield of Arizona office has been serving clients since 1987 and has become a highly respected commercial real estate advisor. The Phoenix office supports a full range of commercial real estate services, including brokerage (office, industrial, retail, multifamily, medical office, tenant representation and investment brokerage), corporate occupier and investor services (property management and project management), capital markets (office, industrial and retail investment brokerage) and valuation and advisory services (appraisal). Offering a complete array of global real estate solutions, Cushman & Wakefield (C&W) has earned an international reputation for excellence by working together with its clients to ensure they achieve the highest value and best use of real estate in every major market around the world. Cushman & Wakefield of Arizona closed out 2013 by negotiating the $113.6-million sale of the First Solar manufacturing facility to Apple in Mesa. C&W is the world’s largest privately held real estate services firm and has earned its prestigious position by remaining true to the core values instilled in the company by its founders — namely, a dedication to its clients. Metro Phoenix represents one of the nation’s fastest-growing and most dynamic markets, with its expanding economy and strong work force, resort lifestyle and

amenities, and strategic location within the Southwest. Well-positioned in the major local markets, C&W of Arizona strives to serve the region’s real estate sector and its increasing needs with the full array of services rendered by C&W around the globe. The firm’s professionals develop integrated solutions to help clients buy, sell, finance, lease and manage their assets. The firm also provides strategic expert advice on operational issues, risk management, facilities configuration, location and labor factors, real estate market conditions, tax considerations, capital allocation and other relevant issues. C&W’s services help clients turn fixed assets into dynamic assets that are ready to make a significant contribution to overall corporate performance, regardless of the economy or business cycle. Specific areas of service include agency/ brokerage services, optimally positioning and marketing properties and uncovering hidden opportunities for clients; asset services, including property and project management as well as construction supervision; capital markets services, providing sophisticated financial strategies and funding solutions; client solutions services, utilizing a strategic, global approach delivered through a single point of contact; consulting services, including alignment review, performance management, portfolio optimization and sustainability advice.

Gregory B. Valladao

PROFILE Company Name: Cushman & Wakefield of Arizona, Inc. Main Office Address: 2555 E. Camelback Road, Suite 300, Phoenix, AZ 85016 Phone: (602) 253-7900 Website: www.cushmanwakefield.com Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 35 in brokerage, 16 in property management, 12 in valuation & advisory (appraisals) City Nationally Headquartered: New York Senior Managing Director/Market Leader : Gregory B. Valladao No. of Years with Firm: 3 years Year Est. Locally: 1987 Specialties: Capital Markets, Tenant Representation, Valuation & Advisory, Corporate Occupier & Investor Services, Property Tax (newly added).

FINANCIAL: Property Sold in 2013 Value: $560 million Property Leased in 2013 Value: $326 million Commercial Transactions Closed in 2013: 484

The purchase of the First Solar plant in Mesa by Apple for its supplier GT Advanced Technologies will bring 2,000 jobs to the Valley, according to the Arizona Commerce Authority. Cushman & Wakefield of Arizona, Inc. brokered the deal.

M AY 2014

INBUSINE SSMAG.COM

CUSHMAN & WAKEFIELD WOULD LIKE TO THANK ITS CLIENTS FOR HELPING US ACHIEVE A RECORD YEAR IN 2013! $2.5B GROSS REVENUE

+21.9%

GROSS REVENUE GROWTH

$145M

+10.5%

INCREASE (U.S. GAAP)

+60.4%

INCREASE (U.S. GAAP)

ADJUSTED EBITDA

$46.2M

ADJUSTED NET INCOME

-$91M NET DEBT DECREASE

(U.S. GAAP)

1 Billion+ SF PROPERTY UNDER MANAGEMENT

$1 Trillion+ VALUE OF APPRAISALS +15% INVESTMENT SALES TRANSACTIONS +7% LEASING TRANSACTIONS

+13.2%

COMMISSION & SERVICE FEE GROWTH

CUSHMAN & WAKEFIELD HONORS ITS 2013 TOP ARIZONA PRODUCERS

CHRIS TOCI

JIM WILSON

JIM CREWS

MICHAEL WHITE

LARRY DOWNEY

GREG VALLADAO

BRETT POLACHEK

JOHN GRADY

JACKIE ORCUTT

CHAD LITTELL

TIM LOVE

ADAM MADISON

Investment Properties

Multifamily Properties

Industrial Properties

CUSHMAN & WAKEFIELD OF ARIZONA, INC. 2555 East Camelback Road, Suite 300 Phoenix, Arizona 85016 (602) 253 7900

cushmanwakefield.com

Multifamily Properties

Industrial Properties

Office Properties

Investment Properties

Corporate Services

Valuation & Advisory

Investment Properties

Retail Advisory Services

C O M M E R C I A L R E A L E S TAT E SPOTLIGHT ON THE BEST

NAI HORIZON As members of the largest world-wide network of owner-operated, local marketleading commercial real estate brokers, NAI Horizon is a respected local-market role model, passionate about the commercial real estate business. NAI Horizon has provided a full range of Commercial Real Estate services for more than 23 years, including brokerage, property management and appraisal services for local, national and international clients. NAI Horizon is proud to lead the Phoenix market, being ranked No. 1 in appraisal, No. 2 in brokerage and No. 4 in property management among Arizona’s commercial real estate companies by Ranking Arizona. At NAI Horizon, our global strength is built on our local leadership. You can feel the pride NAI Horizon takes in our relationship with you and how important your business is. You get the confidence that your needs will be our top priority — not just our next assignment — because our own success is entirely dependent on your success. Our commercial real estate professionals facilitate millions of dollars in transactions each year and specialize in all commercial

property types, including office, industrial, healthcare, retail, multifamily, land and investment sales. As a member of NAI Global, we are truly set apart in the industry. Collaboration is a rare find, but at NAI, we share best practices and harness our collective intelligence to strategically assist our clients. With offices around the world, we represent the most respected names in each of those markets. Our clients come to us for our deep local knowledge and build their businesses on the power of our global managed network. NAI Global member firms, leaders in their local markets, are actively managed to work in unison and provide you with exceptional solutions to your commercial real estate needs. NAI Global member firms span the U.S. and 55 other countries, with 400 offices and more than 5,000 local market experts on the ground. Supported by the central resources of the NAI Global organization, member firms deliver marketleading services locally, and combine their in-market strengths to form a powerful bond of insights and execution for clients with multi-market challenges in the U.S. and/or globally.

PROFILE Company Name: NAI Horizon Main Office Address: 2944 N. 44th Street, Suite 200, Phoenix, AZ 85018 Phone: (602) 955-4000 Website: www.naihorizon.com Number of Offices in Metro Phoenix: 1 Number of Commercial Agents: 45 City Nationally Headquartered: Phoenix President/CEO: Thad Seligman Principal/COO/Designated Broker: Terry Martin-Denning No. of Years with Firm: Thad Seligman: 8; Terry Martin-Denning: 24 Year Est. Locally: 1990 Specialties: Office, Industrial, Retail, Property Management, Valuation

FINANCIAL: Property Sold in 2013 Value: $197 million Property Leased in 2013 Value: $176 million Commercial Transactions Closed in 2013: 491

NAI Horizon Headquarters

M AY 2014

INBUSINE SSMAG.COM

Congratulations

2013 Top Ten Producers

Mike Myrick

John Filli Brad Ranly

Sharon Reeves

Gabe Ortega Shelby Tworek

Chris Gerow Lane Neville

Mark Wilcke Barbara Lloyd

BROKERAGE • PROPERTY MANAGEMENT • APPRAISAL/VALUATION CONTACT NAI HORIZON | 602.955.4000 | 2944 N 44TH STREET, SUITE 200, PHOENIX, AZ 85018 | WWW.NAIHORIZON.COM

OFFICE

Commercial Properties Incorporated is a full-service brokerage and property management firm for all product types. With over 50 agents and 2 local offices, CPI represents 55.5 million square feet for sale or lease. CPI manages over 130 projects totaling more than 4.5 million square feet in the Greater Phoenix Metropolitan Area.

notes

Simply Stated.

Your trusted advisor

We’ve simplified our name because real estate is complex enough Jones Lang LaSalle is now JLL. We’ve shortened our name, but not our commitment to providing clients with global resources, market insight and world-class service. Simply stated, we add real value to grow your business. jll.com/phoenix JLL offers the perfect combination of world-class resources and personal service—a listen-first, Capital Markets ▪ Tenant Representation ▪ Agency Leasing collaborative approach focused on helping you make real estate decisions that align with your business strategy and contribute to your bottom line. Industrial ▪ Multi-Family ▪ Retail ▪ Data Centers Let us be your trusted advisor.

GLOBAL CHAMBER Global Chamber Events www.globalchamber.org

May 5, 2014 Arizona International Growth Group “Cinco de Global” Lyndon Smith, CEO of Gilbertbased Biohumanetics, shares tips to executives on growing globally. June 2, 2014 Global Chamber PHX “Global Chamber PHX” Executives share tips on global business success for companies based in Arizona. August 4, 2014 Global Chamber PHX “Summer Global Business Lunch” Featuring 3 speakers on global business and a wonderful international lunch. September 6, 2014 Global Chamber PHX “Grow Globally PHX” All of Metro Phoenix’s global resources, all in one place, once per year. Grow globally!

Spotlight Event May 1 – 2 , 2014 “VerdeXchange Arizona 2014” A collaborative regional and global conference on business, education, healthcare, technology, infrastructure, livability and sustainability to help business leaders tap into growth opportunities. www.vxarizona.com

Inside this section

2 If Not Now, When? Here’s How

also: Be Aware of Cultural Differences also: U.S. Commercial Service also: A World of Opportunity with Mexico also: Canada-Arizona by the (Growing) Numbers

4 To Grow Globally, Think Differently 5 ULaws nderstand Anti-Corruption in Global Business 6 How to Finance Exports and Reduce Risk 7 Thank You. Grow Globally

also: Doing Business in China: Easy and Difficult

MAY 2014 – AUGUST 2014

Catch Global Fever Doug Bruhnke, Founder of Global Chamber

It’s sometimes hard to pick up on this because bad news sells newspapers and drives clicks, but every year the world is getting better. Don’t believe me? Visit www.gapminder.org and see how, over the past 200 years, peoples’ wealth and health has improved dramatically. Annually, 50-100 million global citizens come out of poverty and average life expectancy continues to increase. With declining birth rates and longer lifespans, 50 percent of the world’s population will be over 50 years old in 30 years. More adult diapers are sold in Japan than diapers for children. Brookings forecasts that 92 percent of the world’s economic development in the next 10 years will happen outside the United States. With so much business opportunity happening over there, what are you still doing here? Less than 1 percent of U.S. companies export, and of those, most export to only one country, and most of those are either Mexico or Canada. Attracting foreign direct investment and export revenue is money that goes back into the local economy to improve education, build

Arizona’s Turning Point

infrastructure and invest in the future. Growing globally is our region’s next great opportunity to grow wealth. As an ex-New Yorker with German-Polish roots and a corporate guy who was an expat in Tokyo and Singapore, I’ve been in my global phase for many decades. I started Arizona International Growth Group (AZIGG) six years ago to be a collaborative, learning place to connect with others having global fever. Now global business is more important than ever. I hope you’ll take the chance to read through this section and learn more about AZIGG, the new Global Chamber and these strategically important opportunities.

Arizona has the 14th largest state population, and, as the 12th-ranked state for tourism, we’re above average. Yet we’re below average in exporting (ranked 18th) and foreign direct investment (27th). Brookings reports that in 2012, Metro Phoenix had $2.2 billion of exports with 4.4 million people, while Metro Salt Lake had over 50 percent more exports with one-fourth the population. With their export intensity, Metro Phoenix would add over 100,000 jobs. In addition Salt Lake’s export growth is ranked No. 1 among the top 100 Metros since 2003, and Metro Phoenix is ranked No. 96. I was a businessperson in Salt Lake City through the 2002 Olympics, and it was extraordinary to be part of a business and government collaborative effort to welcome the world and attract new foreign investment and businesses. Subsequent globalization efforts there have included converting elementary schools into immersion language training centers to improve inherent international capabilities. Salt Lake 2002 was a turning point for global business success. What will be ours? GlobalChamber.org

GLOBAL

If Not Now, When? Here’s How Resources to Grow Globally

Doug Bruhnke, CEO of Growth Nation and Founder of Global Chamber

Business executives can’t be waiting around for a government entity to change Arizona’s international success. It just doesn’t work that way. But government can hinder or help. For instance, Arizona legislators passing SB1070 and SB1062 damaged Arizona’s international standing. People from around the world — and not just Mexico — continue to ask, “Why do people in Arizona dislike immigrants?” Globally minded executives must speak out as they did before Governor Brewer vetoed SB1062, a clear sign of progress. Why will bills like SB1062 be a problem regarding globalization for any state considering them? It’s because people with different skin color and religion are always the ones who suffer the most from discrimination. Like any company with a PR program, Arizona needs to find a way to flip the script and demonstrate that the state needs and wants immigrants. On the positive side, taxation changes advocated by public policy initiatives of the Arizona Chamber of Commerce and Industry have helped to improve the competitiveness of Arizona companies and create a more welcoming environment for foreign investment. Leaders like Glenn Hamer (Arizona Chamber) and Steve Zylstra (Arizona Technology Council) are public-private partnership heroes. For business leaders reading this, how can you connect to more global business? Help set the tone for Arizona by speaking out against discrimination and the perception of discrimination against foreign nationals. And on the business side of things, jump in! If not now, when? Arizonan Stephen Beschloss posed that question last year, demonstrating that the time to strike is now. The wealth shifts are happening. There are many valuable global resources in Arizona to connect with and that are available to help your efforts. Here are some: CANADA: Canada Arizona Business Council (CABC) (www.canaz.net), led by Glenn Williamson, provides “hands-on” support and inspiration for business development between Canada and Arizona. MEXICO: Margie Emmermann is the executive director of Arizona Mexico Commission (www.azmc.org), supporting a binational policy drive for the Arizona-Sonora region. The commission enables the opportunity to capitalize on the opportunities the region has to offer.

Be Aware of Cultural Differences Melissa Lamson, CEO of Lamson Consulting

Global Chamber

MORE COUNTRIES: The Arizona Consular Corps (www.arizonaconsularcorps.org) acts as a forum for the accredited consuls in Arizona by supporting fellow consuls and consulates in their respective diplomatic outreach; by building relationships with governments and community; and fostering business, educational and cultural endeavors. EXPORTING: The U.S. Commercial Service is a trade promotion arm of the U.S. Department of Commerce’s International Trade Administration. U.S. Commercial

Service professionals in over 100 U.S. cities and in more than 75 countries help U.S. companies get started in exporting or increase sales to new global markets. In coordination, the District Export Council is a 30+ member council of international trade experts appointed by the U.S. Secretary of Commerce who support exporting initiatives within each region. EDUCATION: Thunderbird Online (www. online.thunderbird.edu) provides online courses and executive certificates to busy professionals seeking to continue learning. STUDY ABROAD: CEA Study Abroad (www. ceastudyabroad.com) creates and facilitates opportunities for academic achievement, global competence and personal growth through quality international education. LOGISTICS: Trade professionals can stay up on the latest global logistics information in Tucson at SALEO (www.saleo.org) and in Phoenix at OWIT (www.owitphoenix.org). LEGAL: Some of the local law firms are particularly adept at helping companies navigate global business, especially Snell & Wilmer (www.swlaw.com), Galbut & Galbut (www.galbutlaw.com) and Polsinelli (www.polsinelli.com). BANKING: A few local banks have the ability to support global expansion, including Alliance Bank of Arizona (www. alliancebankofarizona.com), with resources that can help with export-import lending.

Doing business across cultures can be challenging, fun and profitable. Recruiting, hiring, decision-making, building of relationships, customer needs, and even business terminology can differ in diverse country contexts. It takes time, conscious effort and the right questions to understand how people see the world and therefore view business. For instance: 1) In Germany, the word “career”

2) In Brazil, “friendliness” is the

3) In Singapore, the top tier

has a negative connotation. It

most important value in business

graduates out of the best schools

suggests someone is climbing the

relationships. If you aren’t seen as

go into public service jobs — to

ladder on the backs of others.

friendly, you won’t get anywhere.

help run the country.

For more information, contact Melissa Lamson at melissa.lamson@lamsonconsulting.com.

INSURANCE: Capital West Insurance (www.capitalwestins.com) offers a variety of insurance products and risk management solutions to individuals and businesses growing globally. TECHNOLOGY: Valor Global Services (www.valorglobalservices.com) supports the changing technology infrastructure of companies growing globally. MARKETING AND SALES: Growth Nation (www.growthnation.com) helps companies grow globally and locally with every kind of marketing and sales support. CITY-TO-CITY CONNECTIONS: Phoenix Sister Cities (www.phoenixsistercities.org), Scottsdale Sister Cities (www.scottsdalesistercities.info) and other Sister City organizations create people-to-people connections between Arizona residents and their sister cities through commercial, educational,

cultural and artistic exchange programs and events that inspire global, long-term, international partnerships and business opportunities FOREIGN POLICY: Phoenix Committee on Foreign Relations (PCFR) (www.pcfraz.org) assists leaders in Arizona to respond more effectively to a rapidly changing world. INTERNATIONAL VISITORS: Arizona Council for International Visitors (www.azciv.org) hosts international visitors in Arizona in cooperation with the U.S. Department of State and Global Ties U.S. REFUGEES: Welcome to America Project (www.wtap.org) provides furniture, basic necessities, education and additional resources to newly arriving refugees in Phoenix. GLOBAL CITIZENSHIP: New Global Citizens (www.newglobalcitizens.org) inspires youth to be engaged global citizens.

Government Resources that Work Eric Nielsen, Director at U.S. Commercial Service, Arizona

Arizona companies looking to build overseas sales are wise to turn first to 20 Free Trade Agreement (FTA) partners for export opportunities. FTAs give

A World of Opportunity with Mexico

American goods a distinct competitive advantage versus products from other countries due to reduced tariffs and a

Michael Patterson, Shareholder at Polsinelli

more transparent trading and

Mexico is Arizona’s top trading partner, with

Cross-border trade is increasing. Prominent

investment climate.

$6.3 billion in Arizona exports to Mexico in 2012

Mexican companies in Arizona include GoNet USA

(2.9 percent of the total U.S. exports to Mexico).

(software and services, an Inc. 5000 fastest-growing

partners Canada and Mexico

company), Cemex (regional headquarters in Phoenix

(which account for half

and branches throughout the state), Interceramic

of Arizona’s merchandise

(construction materials with multiple locations), Vitro

exports), FTA partners include

(glassmaker with locations in Phoenix and Tempe),

Australia, Chile, Colombia,

Gruma (food products with locations in Phoenix and

Israel, Korea, Peru, Singapore

Tempe), ECN (mining industry control systems), Bimbo

and most of Central America.

Other facts: • There are 24 million border crossing persontrips from Mexico into Arizona each year, which accounts for 19 percent of Arizona’s international total in tourism dollars. • Mexican sources are responsible for more than $420 million in foreign direct investment in Arizona since 2007. • There are 182 direct nonstop flights a week between Mexico and Arizona.

(food company that owns U.S. food companies) and

In addition to NAFTA

The U.S. Commercial

Tiempo (Arizona software development company with

Service (USCS) is positioned

subsidiary operations in Mexico).

here and around the world

For more information, contact Michael Patterson at mfpatterson@polsinelli.com.

to help Arizona exporters evaluate and prioritize FTA market potential and implement a business

Canada-Arizona by the (Growing) Numbers

development strategy. The “Gold Key” program by USCS is a high-ROI program for

Glenn Williamson, CEO of Canada Arizona Business Council

1. $2.5 billion in exports from Arizona to Canada

6. 300+ Canadian companies operating in Arizona

2. $6 billion in FDI (Foreign Direct Investment)

7. 17 years of Sister City relationship between

3. 1 million Canadians visiting Arizona per year 4. 53% of international tourism dollars in Arizona come from Canadians 5. 127 nonstop flights per week between Canada and Arizona

Phoenix and Calgary 8. 62 years presenting the Great Canadian Picnic. For more information, contact Glenn Williamson at

businesses to find reliable partners internationally. Contact us at www.export. gov/arizona or by emailing eric.nielsen@trade.gov to learn more.

Glenn Williamson gwilliamson@canaz.net.

GlobalChamber.org

GLOBAL

To Grow Globally, Think Differently Keith Galbut, President and International Lawyer at Galbut & Galbut

Increasingly, Arizona companies are looking to overseas markets to do business. In this ever-evolving landscape of internationalized business, it is important for Arizona businesses to carefully consider the legal implications associated with their international business dealings. The best strategy, of course, is to be well-informed about the key legal considerations for a local business entering the international marketplace and to identify advisors who take a holistic approach. No distinct body of law governs all international business. Rather, international business law is an amalgam of private contract law, U.S. and foreign domestic law, and international treaties. An evaluation of the effect of these various laws, and the ability to reach private agreements that incorporate or offer an alternative to these laws, is critical to optimizing a company’s ability to act globally. Naturally, it is important to seek the assistance of legal counsel who has a keen understanding of how to best structure private international agreements and the ability to call upon a network of advisors who can provide particularized knowledge. Among those areas in which specialized expertise is advised are intellectual property, business formation, tax, employment and dispute resolution. It is critically important to assess the intellectual property regulations and enforcement mechanisms in force in the

country in which one plans to do business before engaging in any activity that may jeopardize a company’s intellectual property. Identifying the proper corporate entity and structure for an international business venture is vital for limited liability, capitalization and tax reasons. Advice of foreign counsel with knowledge of foreign corporate requirements, the nuance of foreign bureaucracy, and the relevant timelines for formation and compliance is crucial in these areas. Every foreign jurisdiction has localized tax and accounting regulations. In every case, the impact and requirements of U.S. tax law must be evaluated, and counsel skilled in international tax is imperative. Perhaps the area of law with the greatest variance internationally, and that creates the most challenge for small and medium-sized business, relates to employment. Depending on the transaction at hand, there are myriad local, national and even multinational employment regulations that may need to be evaluated for their impact upon a company’s ability to conduct business in a foreign locale and procure a work force. It is imperative to plan in advance to manage disputes that may arise in the course of international business. Dispute resolution processes differ throughout the world and are influenced by local laws and cultural norms. The result is that, absent a contractual

designation by the parties of a governing set of laws, forum or dispute resolution process, there is uncertainty as to how, when and where disputes will be resolved. The parties should, at the very least, agree in advance to the forum, choice of law, and arbitration and/or mediation provisions, and make certain that these provisions will be enforced in selected jurisdictions. Engaging in the global marketplace can provide tremendous opportunities for Arizona companies. However, the challenges posed by transacting business where different and conflicting laws apply, or where there are limited legal protections in place, must be evaluated by companies considering doing business internationally. For more information, contact Keith Galbut at kgalbut@galbutlaw.com.

Doing Business in China: Easy and Difficult Karen Dickinson, Shareholder at Polsinelli and President at Arizona District Export Council

Arizona companies are successfully expanding

in 2012), along with agricultural products,

their businesses to China, with 163-percent

transportation equipment, minerals and ores,

growth in Arizona exports to China since

and machinery.

2002 and 25-percent growth in 2012 alone.

China offers many opportunities for Arizona

Service, and from others who have actually

China is now Arizona’s third-largest trade

companies, especially in cities such as Beijing,

done deals in China. And make sure you

partner, with $1.2 billion in exports in 2012

Guangzhou, Chengdu and Shanghai and

learn about Chinese culture to make sure

— 6.8 percent of total Arizona exports for

nearby cities such as Hangzhou, Suzhou,

poor communications do not kill an otherwise

last year. Major exports products to China

Wuxi and Nanjing. To take advantage of

spectacular deal.

include computer and electronic products

these opportunities, seek advice from

(48.7 percent of Arizona exports to China

the Arizona offices of the U.S. Commercial

Global Chamber

For more information. contact Karen Dickinson at karen.dickinson@exportaz.org.

Understand AntiCorruption Laws in Global Business Brett Johnson, Partner at Snell & Wilmer, LLP

Recently, several companies have publicly disclosed that they are internally investigated or are being investigated by United States and foreign governments related to alleged bribery of foreign officials in an effort to obtain a business advantage. The majority of the investigations have related to alleged violations of the Foreign Corrupt Practices Act (FCPA) or similar Chinese laws. The companies have included WalMart, Sands Casino, Avon and GlaxoSmithKline, among others. Some allegations relate to orchestrated schemes. Other allegations concern the hiring of government employees’ children, lavish trips or allotting excessive funds for entertainment purposes. In other cases, even when the companies under investigation are not directly involved, the companies’ third-party agents and vendor supply chain are implicated and the companies are still held accountable. For the past several years, the Department of Justice has constantly reiterated that enforcement of the FCPA and other international

trade laws is a top priority. In November 2012, the DOJ added to its reiteration by issuing A Resource Guide to the U.S. Foreign Corrupt Practices Act (“Guide”). Companies that operate globally cannot ignore the international framework of anti-corruption laws. With the Guide as a framework, companies should have policies and procedures in place to address the concerns. Senior management must encourage a “culture of compliance” and direct regular training on the company’s policies. Furthermore, companies must direct third-party representatives (including vendors and distributors) through well-written agreements and annual notifications that bribery is simply not tolerated. If you’d like more information, please contact Brett Johnson at Snell & Wilmer (www.swlaw.com), who represents businesses and individuals in government relations matters. His practice includes international transactions and compliance, export, government contracting and commercial litigation.

GlobalChamber.org

GLOBAL

How to Finance Exports and Reduce Payment Risk Mark Roberts, VP of Specialized Banking Services at Alliance Bank of Arizona

An International Scenario Let’s say things are moving forward. As a business owner, you’ve recently learned that there is demand for your product by consumers outside of the United States, and that selling to those markets could be quite lucrative for your company. You’ve also determined that the most effective way to get your product to foreign consumers is through wholesale distribution channels in the consumers’ respective countries. Foreign distributors have agreed to sell your product, but only if you are willing to offer 90+ days payment terms. This creates two risks: • How can you be sure you’ll get paid? After all, this is a new customer in a foreign land. While the distribution companies have excellent reputations, based upon your prior due-diligence, there is still the risk that the companies could go bankrupt or something could happen politically that impacts their ability to pay. • How will you finance the working capital needed to provide payment terms? While the expansion into new markets would profitably double sales for your company, the cash needed to invest in inventory and accounts receivable to support offering extended terms requires liquidity that your company simply does not have on hand. Furthermore, foreign accounts receivable are not a form of acceptable collateral for advancement on a traditional line of credit.

The Solution Fortunately, there are effective tools available to your company by globally minded banks and government agencies that can alleviate your concerns. Let’s look at each concern again but let’s rename them Payment Risk and Performance Risk.

Global Chamber

Payment Risk Payment risk can be mitigated by obtaining affordable credit insurance on the foreign accounts receivable. The most popular method of insuring foreign receivables is through the Export Import Bank of the United States (EXIM Bank). The EXIM Bank is the official export credit agency of the United States. EXIM Bank’s export credit insurance policy provides payment coverage for both commercial risks (such as buyer default) and political risks (such as war). Performance Risk A company’s ability to meet buyer demand and to offer payment terms can be impaired by its ability to finance export-related working capital. Credit insurance, from the EXIM Bank or a qualified private insurer, can be used as a tool to enable globally minded banks to advance on a line of credit using foreign receivables as collateral. Additionally, the EXIM Bank and the U.S. Small Business Administration both provide approved banks with loan guarantees that can be used to finance export-related inventory and receivables that would otherwise be ineligible to support credit. Summary Export credit insurance and loan guarantees are very effective financial tools available to qualified U.S. small and medium-sized business exporters that can substantially reduce payment risk and support working capital so exporters can take advantage of lucrative sales opportunities in global markets. For more information, contact Mark Roberts at Alliance Bank of Arizona (www.alliancebankofarizona.com).

Global Chamber Global Chamber PHX

Thank You. Grow Globally. The Arizona International Growth Group (AZIGG) was founded in 2007, and since then over 100 Arizona-based business leaders have presented their successes, challenges and tips regarding global business growth to over 10,000 attendees and members. AZIGG becomes the Global Chamber PHX in June, part of the Global Chamber headquartered at SkySong and dedicated to supporting the crossborder growth of companies, careers and communities — with interviews, events, seminars, success stories, connections and resources intended to help companies grow cross-border commerce. The Global Chamber is planning to have locations outside Arizona and the U.S. We collaborate with businesspeople and organizations all over the world to support global business success. We believe that as cross-border trade, tourism, education and investment increase, the world gains more understanding and forward-leaning progress. To grow globally is to have a positive impact on the lives of people all over the world. Join us at www. globalchamber.org. Thanks to our thousands of supporters for your help and interest. Special thanks go to our early-adopting sponsors and partners. Quite literally, it means the world to us!

Chairman/CEO Sponsors

President Sponsors

Snell & Wilmer LLP Growth Nation Polsinelli Thunderbird Online Adept Consulting Group

Galbut & Galbut PC Alliance Bank of Arizona DIRTT Environmental Solutions Human Capital Strategies Lamson Consulting Arizona State University

Special Global Advisors Keith Galbut, Galbut & Galbut PC Hank Marshall, UK Honorary Consul in Arizona Glenn Williamson, Canada Honorary Consul in Arizona Bob Bingham, Bob Bingham Companies Melissa Sanderson, Freeport McMoRan Charles Bruce, Peter Piper Pizza Collaborating Groups Arizona Council for International Visitors Arizona Technology Council Arizona Chamber of Commerce & Industry Phoenix Committee on Foreign Relations U.S. Commercial Service U.S. Export Assistance Center Committees Community

Globalization

Membership

Programs

Sponsorship

Contacts Founder/President: Doug Bruhnke, doug@globalchamber.org Community Developer: Shiena Amigo, shiena@globalchamber.org Media Contact: Yvonne Luker, grow@growthnation.com

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GlobalChamber.org

Take the blinders off. There is a better faster way. by Rick Murray, ASBA Chief Executive Officer

About Us The Arizona Small Business Association (ASBA) is the largest trade association in the state representing 11,000+ member businesses, and over 1/2 million employees in all 15 counties. ASBA members enjoy access to significant group discounts, countless opportunities to do business with each other, a wide array of insurance products, and active advocacy efforts on public policy issues to protect their businesses. Discover more at www.asba.com.

Have you ever arrived at a destination after driving for 30 or so minutes and wonder how you got there? That happens to me more times than I care to admit, and I find myself wondering if I ran any red lights, or cut anyone off on the freeway. For all I know, I could have left a trail of destruction on the freeway, and I would have never had a clue. During an early morning meeting, I was checking my email as I got up to take a bathroom break. While in the bathroom stall, I hear people come in and occupy the stalls on either side of me. It didn’t take long for me to realize that these weren’t men in the stalls. The absolute horror that coursed through my veins at that moment is indescribable. Trying to be as quiet as possible, and waiting for the occupants to wash their hands...and of course chat…and then finally leave, I peered over the stall to make sure the coast was clear. As I dashed out of the women’s bathroom across the hall into the men’s bathroom, I was scolding myself. How could I be so inattentive! The moral of the story?

Sometimes we can get halfway through our business

before we realize we’re in a completely different place than we thought we were. As business owners, we have so many things that consume our attention that we sometimes end

Join ASBA. Be amAZed®

up running our businesses in the same mental state as that zombie-like commute to the office or that misguided bathroom break. We tend to run on "auto pilot," which assumes the situation or conditions are always constant, when most times they are not. While running on auto-pilot can

in this issue Top 6 Do’s and Don’ts for Small Business . . . . . . . . . . pg. 2 2014 Election Season at a Glance . . . . . . . . . . . . . . . . . . pg. 3 Work healthy, train hard, succeed and win! . . . . . . . . . . . . . . pg. 4 Central Arizona 4600 E. Washington Street, Suite 340 Phoenix, AZ 85034 p. 602.306.4000

f. 602.306.4001

"grab the steering wheel" to get better control of the road and where you are ultimately going. If this sounds like you, just know you aren’t alone, and there is a cure. It’s called the ASBA Business Mentoring Program. This unique business-building program incorporates mentoring, education and information. It connects committed business owners, professionals and executives who want help (Mentees) with experienced business owners, specialists and subject-matter experts who want to provide help to support the growth of other businesses (Mentors).

Of all the products and

services offered by the Arizona Small Business Association, the Business Mentoring Program is perhaps the best resource there is to help any small business to succeed. Too often we have blinders on...we don't pay attention. We just follow in a straight line because we think we are heading in the right direction, but it may not always be the right direction for us. Take the blinders off, and see if there are better, faster, quicker and more efficient ways to get to your ultimate destination.

Southern Arizona 4811 E. Grant Road, Suite 262 Tucson, AZ 85712 p. 520.327.0222

be efficient, a time-saver and sometimes necessary, you still need to focus, pay attention and

f. 520.327.0440

© 2014 ASBA. A publication of the Arizona Small Business Association. For more information or to join ASBA, please contact us at www.asba.com. Section designed by the Arizona Small Business Association.

Stop and smell the roses! Sometimes we are so focused on the end goal that we forget to enjoy the journey and smell the roses along the way.

Let the

Arizona Small Business Association help you re-capture that vision and enthusiasm it takes to be successful.

Top 6 Do’s & Don’ts for Small Business Provided by Decibel Blue, an ASBA member Everyone has advice when it comes to running your small business. At ASBA, we want to make sure our members are empowered to make their small businesses even better with the below tips to do and pitfalls to avoid.

Do Find Your Competitive Edge – and Keep It Knowing more than your competitors gives you the better advantage as the consumer landscape changes and grows. Being ahead of the game lets you tweak your business so that your product becomes impossible to imitate. Another way to keep this competitive edge is to protect your trade secrets. Make all documents confidential and proprietary and limit who has access to critical information.

Don’t Ignore Unhappy Customer Feedback Complaints aren’t fun. No one likes dealing with negative feedback, but being ready and willing to address the problem, and fix when necessary, makes your customers feel valued.

Do Create an Annual Budget Setting goals for how much you can spend annually on expenses keeps you on track. Can’t buy that new printer in 2014? Allocate the costs for 2015. Doing this minimizes the risk to your

Donna Robinson | Chair VP and Director of Operations, Network Dogs, Inc. Mark Staudohar | Vice Chair President, ACCENT’ Hiring Group Jamie Low, CPCU, CIC | Secretary Owner, Low & Johnson Business Insurance Jacob Gregory, CPA | Treasurer Gainter, Bandler, Reed & Peters, PLC Roy Irwin | Immediate Past Chair Principal, Irwin Insurance & Investments, LLC Bob Cody Director of Technology Consulting, Gate6, Inc. Rick Danford Vice President, BMO Harris Bank Glenn Hamer President and CEO, Arizona Chamber of Commerce and Industry Joe Higgins Serial Entrepreneur, Tucson Metro Area Brannon Hampton Performance Improvement Team Member, Arizona Public Service (APS) Ben Himmelstein, Esq Senior Council, The Frutkin Law Firm, PLC Karen Karr Attorney at Law, Clark Hill

business and decreases the chances that you’ll commit to excess expenses.

Jack Lunsford President, The Lunsford Group, LLC

Don’t Forget About Social Media

Ryan McMullen Regional Manager, RSI Enterprises

It’s the way of the (new) world. While there are many social media mediums out there (Facebook, Pinterest, Twitter, Instagram, Tumblr, Google+), your job is to select AND use the one that is right for your small business. Opening a clothing store? Pinterest may be for you. Bookstore? Tumblr could be a good option for posting your weekly book recommendations. Whatever social media you select, it’s important to identify how it will be used since it’s a vital component for interacting with your consumers on a whole new level.

Do Hire (and Keep) Good Employees It’s worth paying more to recruit and keep good employees. Employees who are proud to work for you represent your business well. A happy workforce is an upbeat business. Not to mention, having employees you trust makes it easier to hand over the reins when you make time to take that two-month vacation to Paris.

Don’t Forget to Network Having a big network is important to your small business. Opening the door to new opportunities exposes your company to others who can use it and even promote it. Attending local business mixers, speaking at conferences and joining LinkedIn are just a few of the ways to get involved. Networking isn’t always an instant payoff; however, over the months and years, your connections will grow and so will your business opportunities.

ASBA Board of Directors

Lynn Paige Owner, LM Enterprises Nick Petra President, Strategic Duck Kim Marie Branch-Pettid Owner and CEO, LeTip International Jess Roman VP Commercial Relationship Manager, Johnson Bank Linda Stanfield Owner, Benjamin Franklin Plumbing Victoria Trafton Consultant and Trainer, Victoria Trafton Presents Russ Yelton President and CEO, Northern Arizona Center for Emerging Technologies

2014 Election Season at a Glance by Jerry Bustamante, Sr. VP, Public Poiicy & Southern Arizona, ASBA

Election season has arrived, and for the next six months, you should expect to see campaign signs on roadways, political commercials on TV and radio, and the occasional robocall with its pre-recorded message. There are elections each year, some bigger than others. I use the word “bigger” to imply that some elections have greater consequences and draw a larger voter turnout. This year, we have a midterm election, which refers to one that falls two years after the quadrennial (4-year) elections of the U.S. President. I consider a midterm election to be the second largest election, second only to the one in which we elect the President and Vice President of the United States. At the federal level, all 435 seats in the U.S. House of Representatives and one-third of the 100 seats in the U.S. Senate are up for grabs during a midterm election. At the state level, however, even more is at stake in 2014 for Arizona voters. Not only are all seats in the Arizona Legislature up for grabs (30 in the Senate and 60 in the House of Representatives), we will also be electing a new Governor, Secretary of State and Attorney General. The 2014 elections in Arizona are very important because the balance of power between the political parties in our state is at stake.

The following are some important dates that you should be aware of:

• • •

July 28, 2014 at midnight - the deadline to register to vote in the Primary Election July 31, 2014 - early voting begins in the Primary Election August 26, 2014 - the date of the Primary Election, which will narrow the field of candidates leading into to the General Election October 6, 2014 at midnight - the deadline to register to vote in the General Election October 9, 2014 - early voting begins in the General Election November 4, 2014 the date of the General Election

For more information on the 2014 elections, I encourage you to visit the Office of the Arizona Secretary of State at azsos.gov.

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Work healthy, train hard, succeed and win! by Carol Mangen, Director, Member Benefits, ASBA A key to any successful business is lowering costs and increasing productivity. Many businesses have discovered that a critical strategy for achieving these goals is ensuring a healthy workforce. The city of Phoenix’s FitPHX program wants to make it easier for businesses to develop their own comprehensive worksite wellness strategies and is H ea l th yA Z wo rk s i te s .o rg

partnering with the Healthy Arizona Worksites Program to offer free training sessions. The first training was held on Wednesday, February 5 at the Phoenix Business and Workforce Development Center. The successful event was well attended, and requests were made for future trainings. The next training is scheduled for Tuesday, May 13 and will be held at the same location. Participating businesses that complete the training and meet certain other criteria will be recognized as a Healthy Arizona

Experience indicates that prevention pays at work. Studies show that costs rise as employee health risks increase:

•

Employers in the U.S. lose $153 billion annually due to absenteeism from workers who are overweight or obese and have

Worksite and named FitPHX businesses.

other chronic health conditions.

Mayor Greg Stanton, Councilman Daniel T. Valenzuela and Olympic Gold Medalist Misty Hyman each spoke to those who attended the first training and are scheduling follow ups with in-person business visits. The training teaches employers how to design a healthy worksite program, with relevant tools and resources. Amongst the first group of participants were businesses that had robust wellness programs in place for many years, as well as companies that are just beginning to roll out a program. Shared feedback on best practices is a component of the trainings. The Healthy Arizona Worksites Program is a public health initiative developed through a partnership between the Arizona Department of

•

Employers can see up to a $6 return on investment for every $1 spent on worksite wellness.

•

A one percent reduction in excess weight, elevated blood pressure, glucose and cholesterol has been shown to save $83 to $103 annually in medical costs per person.

For more information on how to register, visit healthyarizonaworksites.org or call 602.306.4000.

Health Services, the Maricopa County Department of Public Health, and the Arizona Small Business Association.

The training curriculum is

based on the curriculum offered by the Centers for Disease Control and Prevention’s (CDC) National Healthy Worksite Program.

3 Diseases Your Dentist Can Diagnose by Leah Martinez, Delta Dental of Arizona, ASBA Benefits Partner

ASBA

healthy

Gerd – Gerd is a gastrointestinal disease that causes the acids in

businesses, which is why we have partnered with Delta Dental of

understands

that

healthy

employees

mean

your stomach to make their way back into your oral cavity. Dentists

Arizona. Are you putting your best smile forward? Here are some

are often the first to identify GERD in patients because one major

helpful tips to help you do just that.

sign of the disease is dental erosion.

Dentists are normally revered as tooth wizards, the all-knowing oral

Diabetes – About a third of people with diabetes aren’t aware they

health experts. But your dentist is trained to do much more than

have it. Because of high glucose levels, people with diabetes often

simply ogle your oral orifice. Your dentist can spot evidence of more

have problems with their teeth and gums. Dentists who talk to

than 120 different diseases in or around your mouth.

patients with serious gum disease about their personal and family medical history can encourage patients likely to have diabetes to

Here are three health problems in which your dentist might be

see their primary care physician for further testing.

your first line of defense: ASBA has partnered with Delta Dental of Arizona to offer dental Anemia – Anemia is a condition in which your red blood cells count is

plans to businesses with groups as small as one. Contact Carol

lower than normal. If you have anemia, you may not be getting the

Mangen for details at cmangen@asba.com or call 602.306.4000.

oxygen-rich blood your body needs. Your mouth tissue may look pale, and you may have a swollen and inflamed tongue, called glossitis.

ASBA brings resources to businesses during Arizona Small Business Month ASBA brings together Arizona small business owners and

Educational Breakout Sessions

professionals from across the state this May for Small Business

Our educational breakout tracks are quick and designed to allow

Month on May 7 for the Arizona Small Business Conference. This

attendees to interact with key speakers. With nine different classes

event is a power-packed day of timely discussions, relevant

centered around specific fields such as Marketing, Legal, and

education, and meaningful interactions. The day includes:

Financial, our educational breakout tracks allow our attendees to walk away with the tips, the tools and the knowledge designed to

State of Small Business Breakfast

propel their businesses forward.

A high-level look at the small business landscape in Arizona and how it compares to the overall state of small business in the nation.

Full Day Business Expo

Hear from local and national experts, including Rick Murray, CEO of

It's your local marketplace for business! Over 100 of small local

the Arizona Small Business Association, and Todd McCracken,

businesses will be showcased to hundreds of attendees. Generate

CEO of the National Small Business Association.

leads and increase your business by finding new customers and clients at ASBA's Business-to-Business expo.

21st Annual Enterprise Business Awards Luncheon This upbeat, celebratory event showcases the many successes of remarkable Arizona small businesses as we present the prestigious U.S. Small Business Administration Awards for the State of Arizona.

More information about this event can be found at azsmallbizcon.com

SRP Delivers the Tools to Help Your Business Thrive The early leaders of SRP understood the

professionals and organizations that are

provides support to local business schools to

importance of growth in the Valley, which is

highly regarded and recognized leaders in

develop a qualified workforce and attract new

why they worked to bring a reliable source of

their respective fields. SRP provides easy

business that will generate jobs. Additionally,

water and power to the area. Today, SRP

access to a network of experts who can

SRP

continues to support the Valley by providing

assist you with everything from growing your

potential sites and valuable services, including

these essential services and offering tools to

company

and

water resource availability, the location of

help you grow your business.

economic trends that could affect your

electrical infrastructure and energy-efficiency

bottom line.

rebates

identifying

legislation

Workshops to help your business thrive.

delivers

critical

help

information

customers

grow

about

their

businesses locally.

SRP empowers your business to succeed by

Economic development services to grow

providing free information on topics as

the Valley. Over the past century, SRP has

diverse as marketing, finance, technology

partnered with entities across the state to

resources, visit SRP’s Business Resource

and customer service.

advance well-planned economic growth.

Center. It’s a free online resource that offers

Coupled with its award-winning customer

advice to help keep your business competitive.

Access to leading professionals that

service,

Learn more at srpbizresource.com.

know the local market. Local businesses

electricity, water and telecom services have

promote job growth and help drive the

been key components to helping new and

economy. That’s why SRP partners with

existing businesses thrive in the Valley. SRP

SRP’s

affordable

and

reliable

take

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The latest business news on inbusinessmag.com and on twitter @inbusinessmag

/inbusinessmag

@inbusinessmag

ASBA Staff Rick Murray Chief Executive Officer Kristen Wilson Chief Operating Officer Jerry Bustamante, Sr. VP, Public Policy + Southern Arizona Debbie Hann, VP, Finance + Administration Sandi Ahrens Director, Business Development Carol Mangen Director, Member Benefits Rhette Baughman Director, Advertising and Promotion Robin Duncan Business Development Manager Gabe Salcido Marketing Manager Ron Janicki Business Development, Southern Arizona Marlee Roushey Member Services Coordinator, Southern Arizona Raina Bibb Member Benefits Coordinator Laura Bassett Receptionist

Central Arizona

4600 E. Washington Street, Suite 340 Phoenix, AZ 85034 p | 602.306.4000 f | 602.306.4001

Southern Arizona

4811 E. Grant Road, Suite 262 Tucson, AZ 85712 p | 520.327.0222 f | 520.327.0440

Photo Recap Small Business Outlook 2014

INDEX Index by Name

Galbut, Keith, 52

Mays, Shernell, 14

Seligman, Thad, 44

Birg, Ziver, 12

Graham, Bob, 10

Menard, Audrey C., 28

Senning, Daniel Post, 27

Birk, Lorie, 29

Henig, Craig, 38

Messer, Chris, 20

Shaw, Robert Bruce, 27

Blakley, Jason, 16

Humphrey, Chevy, 18

Moberley, Mike, 32

Smith, Dave, 29

Brewer, Jan, Governor, 29

Jerkovic, Jeanine, 20

Morgan, Nick, 27

Snyder, Jud, 15

Broome, Barry, 20

Johnson, Brett, 53

Morris, Jane L., 9, 20

Stralser, Steven, 18

Bruckner, Tim, 15

Johnston, Cliff, 38

Murray, Rick, 57

Stratz, Mark C., 10

Bruhnke, Doug, 49

Kobierowski, John, 14

Neiss, Gary, 20

Strong, Will, 38

Bustamante, Jerry, 59

Kurtz, Jeff, 20

Nielsen, Eric, 51

Taylor, Karrin, 20

Byram, David, 14

Lamson, Melissa, 50

Pace, Julie, 32

Valladeo, Gregory B., 44

Canfield, John, 26

Legg, Jeremy, 20

Patterson, Michael, 51

Venker, Steve, 16

Carney, Bryon R., 40

Lindo, Leslie, 10

Post, Anna, 27

Vigdor, Greg, 66

Cassidy, Brian, 16

Mackay, Christine, 20

Post, Lizzie, 27

Ward, Jennifer, 29

Conyers, Jay, 66

Mangen, Carol, 61

Post, Peter, 27

Waring, Jim, Councilman, 29

Dickinson, Karen, 52

Martin-Denning, Terry, 44

Rider, Michelle, 20

Wesley, John, 20

Drinkwater, Richard, 16

Martinez, Leah, 62

Roberts, Mark, 54

Williamson, Glenn, 51

Friedman, Brian, 20

Mays, Jeremy, 14

Rumpeltin, Michael, 16

Wilson, Tyler, 38

CBRE, 38

Lamson Consulting, 50

Scottsdale, City of, 16

ABI Multifamily, 14

CCBG Arichitects, Inc., 16

LegalZoom.com, Inc., 12

Shopify, Inc., 12

Ahwatukee Foothills

Central Phoenix Women, 30

Lighting Unlimited, 34

Skyline Southwest, 14

Chandler Chamber of Commerce, 30

Local First Arizona, 8

Snell & Wilmer, 7, 53

Alerus Financial, 13

Chandler, City of, 20

Lux Coffee Bar, 35

SOL Cocina, 35

Alliance Bank of Arizona, 54, 56

Colliers International, 48

Maricopa County Medical Society, 66

SRP, 63

Amazon, 12

Commercial Properties, Inc., 46

Mesa, City of, 20

Sundt Construction, Inc., 29

Apple, 12

Conquest Training Systems, 4

Motley Design Group, 10

Tempe Chamber of Commerce, 31

Arizona Chamber of

Copper Star Coffee, 35

Mountain States Employers Council, 29

Tempe, City of, 20

CopperPoint, 2

NAI Horizon, 44, 45

Thunderbird School of

CORE Institute, The, 29

National Association of Women

Index by Company

Chamber of Commerce, 30

Commerce and Industry, 30 Arizona Diamondbacks, 36 Arizona District Export Council, 52 Arizona Hispanic Chamber of Commerce, 30 Arizona Hospital & Healthcare Association, 66 Arizona Science Center, 18 Arizona Small Business Association, 30, 57 Arizona, State of, 29 Arizona Technology Council, 30 Association for Corporate Growth – Arizona, 30 Barnes & Noble, 12 Beyer Management Consulting, Inc., 33 BMO Harris Bank, 15 Brick & West, LLC, 16 Brown & Brown Insurance of Arizona, Inc., 3 Canada Arizona Business Council, 51 Carefree, Town of, 20 Carter, Heather, Representative, 29 Cassidy Turley, 10, 38, 40, 41 Cavenagh Law Firm, The, 32

INBUSINE SSMAG.COM

Cushman & Wakefield of Arizona, Inc., 42, 43

Business Owners, 31 Native American Connections, 29

Global Management, 18 Translational Genomics Research Institute, 29

DAVIS, 16

NJOY, Inc., 29

U.S. Commercial Service, Arizona, 51

Decibel Blue, 58

Painting with a Twist, 14

UnitedHealthcare, 68

Delta Dental of Arizona, 62

Peoria Chamber of Commerce, 31

Urban Beans, 35

DMB Associates, 20

Phoenix Children’s

WESTMARC, 20

Driver Provider, The, 31

Hospital Foundation, 33

Zivelo, 12

Dunn Edwards, 34

Phoenix Children’s Hospital, 5, 29

Bold listings are advertisers supporting

Economic Club of Phoenix, 30

Phoenix Philanthropy Group, The, 18

this issue of In Business Magazine.

Employee Benefits

Phoenix Zoo, 29

International, Inc., 11

Phoenix, City of, 16, 20

Galbut & Galbut, 52

Phoenix-Mesa Gateway Airport, 9, 20

Get Invention Help, 12

Phoenix-Mesa Gateway

Glendale, City of, 20

Airport Authority, 9

Global Chamber, 30, 49

Plantender of Arizona, 34

Grand Canyon University, 59

Polsinelli, 51, 53

Greater Phoenix Chamber of

Project Rising, 10

Commerce, 29, 30

Check Out

Rancho Solano Preparatory School, 28

Greater Phoenix Economic Council, 20

Risas Dental and Braces, 29

Infusionsoft, 55

Rosie’s House, 8

Jaguar, 34

Ryley Carlock & Applewhite, 32

JLL, 47

SCF Arizona, 2

KTAR News Talk 92.3, 67

Scottsdale Area

/inbusinessmagphx @inbusinessmag

It's THE Hub to Building Business

Chamber of Commerce, 31

M AY 2014

ROUNDTABLE

A CANDID FORUM

PPACA Impacts Healthcare Provider Businesses Costs and consequences ripple through economy by RaeAnne Marsh THE UNCERTAINTY ABOUT healthcare that abounds among employers generally is also an issue among healthcare providers. “We seem to be at a watershed moment for where the future of healthcare-delivery financing is going,” says Greg Vigdor, president and CEO of the Arizona Hospital and Healthcare Association, referring to the Patient Protection and Affordable Care Act as well as statespecific programs like Medicaid. Jay Conyers, executive director of the Maricopa County Medical Society, points to reimbursement rate differences as one aspect that has created broad consequences — because a specialist physician gets reimbursed for healthcare services at a higher rate than a primary care physician, even if the services provided are identical. “Even before the Affordable Care Act, there was migration away from primary care,” Conyers says, noting that in the 1950s, 50 percent of M.D.s went into primary care but only 20 percent are doing so now. He believes PPACA has the opportunity to incentivize doctors to seek residencies in primary care and other areas where the need is growing, such as geriatric care. The push by insurance companies and hospital administrations to shift a lot of primary out of the hands of physicians to secondary care such as nurse practitioners makes a lot of sense from a cost standpoint, Conyers admits, but notes patients do not get the same level of care. Addressing another aspect of cost, from the aspect of those underwriting healthcare, Conyers says, “We need more healthy, young people [covered] to balance out the risk.” Explains Conyers, “If we flood the market with people who couldn’t have care before, and a higher percentage are high-risk who need more care, and we require insurance companies to cover them, we need to spread the risk out.” Two possibilities he sees are subsidies from the government and increased premiums from the insurers. On the other

M AY 2014

hand, Vigdor observes, more people are getting signed up for coverage, “and that is generally a good thing — it helps stabilize the provider system by reducing uncompensated care.” A business cost facing healthcare providers is the investment in information technology that the Affordable Care Act pushes. Conyers says doctors see benefits in that electronic health records (EHRs) will enable patients to take better control of their care and give doctors a tool to increase efficiency in collaborating and coordinating care. The only push-back, he says, is the initial cost of the system. “There are so many companies building EHRs, but they’re not interoperable,” he says. “[The government is] telling us we’re not going to get paid if we don’t have a fully integrated EHR, but [it’s] not offering us affordable options.” PPACA is also affecting access to care. “Narrow networks” of providers is one response by insurance companies to control cost to them, says Conyers. “Insurance companies offer coverage plans that can reach more people, and people buy into them based on the premium.” Such plans limit what doctor patients can see, with the possible result of patients not being able to continue to get care from the doctor they’ve been seeing for years for a chronic condition. “Narrow networks allow insurance companies

to control cost by limiting the number of doctors and providers they have to interact with,” Conyers says, but adds, “States are beginning to limit the amount of narrow networks insurance companies can offer.” Networks of providers are an issue also with hospitals, according to Vigdor, who describes two diametrically different responses. One is by affiliation or acquisition of others to become “a really big player.” The other is to “look within the community, and grow a partnership with others more locally.” Quality of care and quantity of tests have been part of the debate around cost and the new healthcare regulations. Emphasizing the need to focus on quality of care and pointing to the highly regarded Mayo Clinic and Kaiser Permanente organizations as examples, Conyers notes their care delivery is “driven by quality, not by how many tests you run a patient through.” Says Vigdor, “We understand that healthcare will have to get better and cost less in the future.” To that end, he observes, “There are a lot of approaches being explored on how healthcare can be delivered to be more affordable and better at the same time.” Arizona Hospital and Healthcare Association azhha.org Maricopa County Medical Society mcmsonline.com

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