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JULY-AUGUST 2017

Most Influential Women in Commercial Real Estate

INSIDE: Infrastructure p. 26 | Constru-TECH p. 30 | Arizona Builders Alliance p. 65


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Looking back, one year later

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his issue is nostalgic for me because this time last year was when I wrote my first editor’s letter after completing my first month of work as AZ Big Media’s associate editor. At the time, I was new to the commercial real estate industry and a wide-eyed recent graduate from the University of Arizona. Since then, I’ve gained an incredible amount of insights and knowledge about the industry through my reporting and daily conversations with the industry’s prominent thought leaders and decision makers, for which I want to express my sincere thanks. That’s enough of my trip down memory lane, though. Let’s get back to this issue of AZRE, which is a special edition featuring the Most Influential Women in CRE. Each has broken through the industry’s glass ceiling within their respective disciplines with determination and hard work. Many of these women are the industry leaders that I mentioned above and had the privilege of working with. Also in this issue, you’ll find:  A special section dubbed “Constru-TECH” that looks at new technologies in construction disrupting how we plan, schedule, build and market projects.  The winners for this year’s International Interior Design Association’s 21st Annual Professional Recognition for Interior Design Excellence (PRIDE) Awards.  A roundtable of AZCREW members with advice for women in CRE trying the break through the glass ceiling.  A collection of projects from Arizona Builders Alliance members. Don’t forget to nominate your picks for next year’s class of Most Influential Women in CRE as we kick off our search again early next spring.

President and CEO: Michael Atkinson Publisher: Cheryl Green Vice president of operations: Audrey Webb EDITORIAL Editor in chief: Michael Gossie Associate editors: David McGlothlin | Jesse A. Millard Interns: Melissa King | Cianna Leparulo Contributing writers: Jake Hinman | Courtney LeVinus | Cheryl Lombard | Mark Minter | Molly Ryan Carson | Deb Sydenham ART Art director: Mike Mertes Graphic designer: Bruce Andersen MARKETING/EVENTS Marketing & events manager: Cristal Rodriguez Marketing coordinator: Kristina Venegas OFFICE Special projects manager: Sara Fregapane Executive assistant: Mayra Rivera Database solutions manager: Cindy Johnson AZ BUSINESS MAGAZINE Senior account manager: David Harken Account managers: April Rice | Cindy Kurtze AZRE | ARIZONA COMMERCIAL REAL ESTATE Director of sales: Ann McSherry AZ BUSINESS LEADERS Director of sales: Sheri Brown RANKING ARIZONA Director of sales: Sheri King EXPERIENCE ARIZONA | PLAY BALL Director of sales: Jayne Hayden CREATIVE DESIGNER Director of sales: Joe Freedman AZ BUSINESS ANGELS Director of sales: Brit Kezar

David McGlothlin Associate editor, AZRE david.mcglothlin@azbigmedia.com

2 | July-August 2017

AZRE: Arizona Commercial Real Estate is published bi-monthly by AZ BIG Media, 3101 N. Central Ave., Suite 1070, Phoenix, Arizona 85012, (602)277-6045. The publisher accepts no responsibility for unsolicited manuscripts, photographs or artwork. Submissions will not be returned unless accompanied by a SASE. Single copy price $3.95. Bulk rates available. ©2017 by AZ BIG Media. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage and retrieval system, without permission in writing from AZ BIG Media.


“ L IM IT L E S S . GENUI N E . E STA B L I S HE D. — Kim Moyers, City of Chandler

LGE Design Build has been perfecting the conception and construction of the Valley's most iconic projects for more than 23 years. But, don't take our word for it. Listen to how clients, influencers, and officials define our work. And there's more to come as we plan out LGE's thrilling future. Look to our next defining moment this summer.


CONTENTS

FEATURES 2 Editor’s Letter 6 Trendsetters 10 Executive Profile 12 After Hours 14 New to Market 16 Big Deals

20 Legislative Updates

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26 Infrastructure

30 Constru-TECH 38 IIDA Southwest PRIDE Awards

44 Most Influential Women in Commercial Real Estate

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56 AZCREW

65 Arizona Builders Alliance

65

On the cover: See page 54

4 | July-August 2017

GO TO store.azBIGmedia.com to purchase subscriptions, digital issues and plaques

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TRENDSETTERS Industrial leads commercial real estate investment sales in Phoenix

Metro Phoenix posts stellar multifamily numbers

Source: ABI Multifamily Phoenix MSA Multifamily Q1 2017 Report

The Greater Phoenix multifamily market experienced another stellar first quarter fueled by both strong jobs and population growth, says Thomas Brophy, director of research at ABI Multifamily. In fact, Maricopa County overtook Texas’ Harris County as the top spot for population growth adding 81,000 people, an average of 222 new residents per day, between July 2015-2016. According to ABI Multifamily’s Q1 2017 Quarterly Report, Metro Phoenix’s total sales volume (10+ unit properties) increased 28 percent, year-over-year, to $780.87 million across 74 transactions representing 7,908 total units sold. Phoenix saw a 15-percent increase in the amount of units under construction, but looking ahead, planned projects experienced its largest five-year contraction dropping 27 percent to 14,834 units. 6 | July-August 2017

Median Sales Price (per SF)

Industrial building sales are leading the Greater Phoenix marketplace, spiking for the second quarter in a row at the beginning of this year, according to a report released by Colliers International. Sales velocity rose five percent from the end of last year and transaction counts were 16 percent ahead of first quarter 2016. On the other hand, overall sales of commercial properties in Greater Phoenix slowed down during Q1 2017. “The outlook is generally favorable,” says Pete O’Neil, research director with Colliers International in Greater Phoenix. “The primary concern at this point is the forecasted rise in interest rates, which would likely push up borrowing costs and cap rates.”

Phoenix Pricing Trends by Property Type

Source: Colliers International Greater Phoenix Q1 2017 Investment Report

Tucson office vacancy

hits 7-year low

Year-over-year improvement in office market metrics continues with a second consecutive quarter of overall market vacancy hovering at a seven-year low, according to a Cushman & Wakefield|PICOR Q1 2017 office market report for Tucson. It identifies a positive absorption of 31,000 square feet, contributing to a 10.6-percent vacancy. Recent announcements by Caterpillar, Vector Industries, Raytheon, Comcast and Ascensus are also strong indicators that Arizona will continue to increase jobs, residents and incomes at a rate exceeding the national average. During Q1 2017, nearly 88,600 square feet of office space was under construction for nonprofit organizations such as Casa De Los Niños, the Girl Scouts and Jewish Federation. However, with no buildings currently under construction and optimism on the rise, Cushman & Wakefield|PICOR in Tucson predict pent-up demand for quality space may spur development of new medical and professional office product in the quarters ahead. TUCSON OFFICE Economic Indicators

Q1 16

Q1 17

Tucson Employment

371k

373k

U.S. Unemployment

4.9%

4.8%

Tucson Unemployment

5.2%

Market Indicators (Overall, All Classes)

Vacancy

YTD Net Absorption (sf) Under Construction (sf)

Average Asking Rent*

4.7%

Q1 16

Q1 17

11.6%

10.6%

178k 0

$18.99

12 - Month Forecast

12 - Month Forecast

31k

12k

$18.86

*Rental rates reflect gross asking $psf/year

Source: Cushman & Wakefield | PICOR Q1 2017 office market report for Tucson


2017 AMA

Tribute Award winners Velaire at Aspera

Each year, the Arizona Multihousing Association brings apartment industry leaders together for one night at its annual Tribute Awards Gala to celebrate the best teams, individuals, volunteers and communities in the state. These winners were selected through a competitive judging process and the 20-plus winners were selected from hundreds of nominations from around Arizona. The full list of winners can be found online at .

Volunteer of the Year – Tucson: Rob Martin-Hart, Scotia Group Management

Developer Award for Best Community (Garden): Velaire at Aspera, P.B. Bell Companies

Industry Partner – Tucson: Kyle Kelly, Sunland Asphalt

Developer Award for Best Community (Mid-Low Rise): iLuminate, Baron Property Services

Best Team & Community prior 1998: Scottsdale Springs, Greystar Real Estate Partners

Renovated Community of the Year: Stone Oaks, Mark-Taylor Residential

Best Team & Community 1998-2008: Belara, Fairfield Residential

Affordable Community of the Year: Aeroterra Apartments, Dunlap & Magee Property Management Inc.

Best Team & Community 2009-2016: San Norterra, Mark-Taylor Residential

Volunteer of the Year – Statewide: Michelle Sinclair, MC Residential Communities Industry Partner – Statewide: Scott Clark, Law Offices of Scott M. Clark P.C.

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TRENDSETTERS

Leasing to medical marijuana dispensaries What happens when a tenant’s business is viewed by some as illicit or illegal? Although Arizona state law permits the sale of medical marijuana through licensed dispensaries, it is still prohibited by federal law, which creates potential issues for landlords that lease to dispensaries. “Should a tenant’s business become illegal,” says Bruce May, chair of Jennings, Strouss & Salmon’s real estate department, “the tenant will be released from its future obligations under prevailing judicial doctrines.” However, the lease should obligate the tenant to reimburse the landlord for rent, tenant allowances, broker commissions and other costs. He says the following preliminary steps should be taken before signing the lease: • The landlord should ensure the use is permitted by zoning, building and safety ordinances. Bruce May • The lease should require the tenant to do its own due diligence and assume any risk, but the landlord should confirm with its lender what’s acceptable and prohibited. • There should be an obligation by the tenant to construct its improvements and conduct its operations in accordance with applicable law with a right of review and inspection by the landlord. • Upon termination of the lease, the tenant must be obligated to remove all of its product from the premises.

New campus planning concept fosters live, work, play environment Earlier this year, Arizona State University began construction on a $72 million Greek Leadership Village that will total 296,438 square feet with five residence buildings comprised of 27 connected chapter houses. The threeand four-story townhomes inlcude 950 total beds. Unlike other campus planning projects, the Greek Village in Tempe trades extensive semi-private yards for greater shared space to enhance inclusiveness and community building for all Greek chapters and their constituent members through a live/ work/play environment.

IMAGE COURTESY, DWL ARCHITECTS

Skyline GROWS in Downtown Phoenix Arizona Center, Phoenix’s original downtown entertainment destination, will add a $100 million residential tower on the southeast corner at Fifth and Van Buren streets. The planned 31-story tower will be the second tallest residential building in Downtown Phoenix. Rising 25 stories above the swimming pool terrace on the roof of the six-level parking garage, will be 350 residences with eight different floor plans ranging from modest studios to one, two and three bedroom units. The 39,970-square foot parcel is under contract to be purchased by Floridabased North American Development Group (NADG) for an undisclosed amount. The architects named for the residential tower project are Phoenix-based Will Bruder Architects. New York-based Skanska USA is managing construction for the project. 8 | July-August 2017

After students proposed the idea, Phoenix-based Studio Ma conducted a long-range feasibility study for ASU to provide initial direction for the project. The firm’s Founding Principal Christiana Moss, AIA, says, “This approach promotes variety and diversity among the councils, while housing daily activities including dining, socializing and daily rituals in clubhouse-like common dressing and bathing rooms.” She is optimistic the idea will catch on at other college campuses based on the project’s initial feasibility study that concluded universities nationwide can benefit by “synthesizing the varied needs and aspirations from the Greek student community.” The project’s completion date is set for fall 2018.


offers online construction management courses LinkedIn, the working world’s social network, entered the professional skills education market in 2015 with the $1.5 billion acquisition of Lynda.com, an online education website with instructional tutorials and videos for subjects like business, technology and finance. In the last six months, it has produced five online courses specifically related to the construction industry with the help of Jim Rogers, a former faculty member at Arizona State University where he taught courses on construction management before leaving to work at the new LinkedIn Learning division. Courses already released include courses on BlueBeam, construction drawings and construction management. The courses feature jobsite footage and interviews from industry experts compiled into a documentary-style video.

3

Paying a monthly subscription provides access to all the construction courses as well as Lynda.com’s online library of more than 7,000 other courses. Rogers says, “It makes a pretty attractive package for a construction company trying to enable learning

challenges to redeveloping a privately owned golf course

With a declining interest in traditional golf, communities are beginning to see decommissioning of golf courses and increases in redevelopment. At an Arizona Association of Economic Development luncheon in May, Grady Gammage Jr., founder of Gammage & Burnham, discussed how these communities can get ahead of

within their ranks of employees.” Courses on technology in construction, working with concrete, health and safety are all in various stages of production plus the launch of a weekly segment about construction management and trends.

1. Zoning - These usually have underlying residential zoning but not in a way that’s easily developed. City zoning is controversial, and likely to require a threequarters vote of the local city council.

Grady Gammage Jr.

the golf ball in the planning process to better understand zoning implications in order to implement strategies and standards for adaptive redevelopment. “Golf demand peaked in 2001,” says Gammage. “As a result, about 150 courses close every year, and only about a dozen new courses open.” He notes three specific challenges to redeveloping a privately owned course:

2. Deed restrictions - These are the private covenants, conditions and restrictions that give residents in the community a say and need to be amended, usually by a vote of all the neighbors in the same subdivision, which is very hard to achieve. 3. Implied restrictions - Even if there are not written deed restrictions, Arizona recognizes a doctrine of implied restrictive covenant if lots on the course were sold at a premium.

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EXECUTIVE PROFILE

The natural

Adam Mays turned a passion for creating into a career of building By DAVID MCGLOTHLIN

F

rom tearing apart and reconstructing things around the house when he was growing up to owning a company that manages more than $125 million in construction projects annually, Adam Mays, founder and president of A.R. Mays Construction, has always been a creator, a builder. As he grew up, it only made sense for him to pursue a career that involved both. Thus, he created his own construction company 31 years ago with the desire to turn his passion for building into a career. “Construction is something that I’ve naturally done my entire life,” explains Mays. “I really enjoy going to these job sites and seeing people work hard for their dollars because I was that guy with the shovel at one point. I was the

10 | July-August 2017

guy in the tractor or pouring concrete or framing houses. I know what it takes.” After moving from his home state of Ohio to enroll in Arizona State University’s construction program, Mays graduated in 1983 and three years later started Devcon Enterprises, which changed its name to A.R. Mays Construction in 2004. Mays says, there were times in the early days when he was the company’s lone employee. Today, the company consists of 100 employees including 50 superintendents that have worked on projects in 30 states across the country. The things that matter the most to Mays at work revolve around developing a culture of trust and action, he says. Mays doesn’t micromanage his employees. Instead, he nurtures them

A.R. MAYS CONSTRUCTION: (left to right) Andrew Mays, assistant project superindendent, and his dad, Adam Mays, founder and president PHOTO BY MIKE MERTES, AZ BIG MEDIA

with support and guidance so they can explore their creativity. Mays trusts their competency and ability to get the needed job done and done well, which is why they were hired. He says, for the most part, the people that he hires are just like him. Hard workers and self-starters who are goal oriented and truly understand that this is an industry where you get out what you put in. “There’s no substitute for hard work,” he explains. Mays has always lived by that motto. From an early age, he started and ran various small businesses around his neighborhood from landscaping to odd-job handyman services. Looking back on his career in construction, a milestone project that sticks out to him is the national awardwinning $60 million UltraStar Multitainment Center at Ak-Chin Circle in Maricopa. This pivotal project helped A.R. Mays Construction rebound from the recession and set a course for where the company is heading today.


MOST INFLUENTIAL

WOMEN

IN ARIZONA Join the celebration as we toast to the 2017 Most Influential Women in Arizona August 23, 2017 | 5:30 - 8:00pm Chateau Luxe 1175 E Lone Cactus Dr, Phoenix, AZ 85024

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AFTER HOURS

The accidental pilot How a business venture led to Neil Sherman’s private pilot license By DAVID MCGLOTHLIN

U

nlike most private pilots, Neil Sherman bought his first airplane before he had his private pilot license (PPL) and unlike most pilots, he earned his PPL about 20 years after his first lesson in the late 1980s. “I wasn’t in a hurry,” explains Sherman, managing director of Sperry Commercial Global Affiliates’ Phoenix office. “I loved to fly and had friends with airplanes who were also instructors. So over the years, I’d log flight hours with them.” He initially started flying on private planes because he was selling properties in smaller rural markets like Flagstaff, Sedona, Yuma and similar areas around the Southwest that weren’t located near a commercial

12 | July-August 2017

airport. Instead of flying commercially, renting a car, paying for gas, and driving for hours from the nearest metro airport, he found it was cheaper to hire a local pilot to get him there. Eventually over time, Sherman started paying his pilot to give him flying instructions, which was more for personal enjoyment than the goal of earning his own PPL. “I wasn’t originally flying for the desire to get the license,” he says. “I was originally flying for business but then got hooked on it and decided to get my license.” It was around that time when the opportunity to buy his first plane came about, but the insurance company required him to officially get his PPL in less than six months if he ever wanted to fly solo. After years of on and off lessons, Sherman realized he logged nearly 150 hours of flight time once he finally started actively pursuing his PPL. “I hadn’t needed the license yet but that

NEIL SHERMAN: After years of flying, he officially earned his private pilot license in 2005.

was a good enough reason to get it,” he explains. “Who wants to own half of a plane that you can’t fly?” The plane was a Mooney, a high performance, complex aircraft known for being ridiculously fast. Sherman had flown it before, loved it and says it was his favorite plane ever even though it was not the most forgiving. With his second plane, Sherman traded speed for luxury and spaciousness. He bought a Cirrus, which he described as going from a Ferrari Formula 1 racecar to a high-end BMW loaded with amenities and gadgets. In the Cirrus, Sherman says, “You didn’t feel like you were in a sardine can strapped to a rocket like you did in the Mooney.” Although he doesn’t currently own a plane, Sherman says, he’s one good run in the market away from buying another one. He is currently talking with some colleagues in the commercial real estate business about possibly going in on a plane together.


August 3, 2017 The Camby 3:30-6:30 PM

ARIZONA’S MID-YEAR UPDATE & FORECAST

AZRE magazine is hosting an all-star panel of Arizona’s top commercial real estate experts to yield in-depth discussions of local economics, development and the state of the industry. This year’s panel will include representatives from across a wide spectrum of CRE sectors.

Pete Bolton President Pete Bolton Company

Bryon Carney Cushman & Wakefield

Dave Cheatham Velocity

Andrew Cheney The Coppola Cheney Group

Dennis Desmond JLL

Grady Gammage Gammage & Burnham

Don Garner Alliance Bank of Arizona

Beth HarmonVaughan Gensler

Brent Herrington DMB

Terry MartinDenning NAI Horizon

Scott Maxwell Cresa

Bob Mulhern Colliers International

Jackie Orcutt CBRE

Sandra Watson Arizona Commerce Authority

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NEW TO MARKET A

D

E

MIXED-USE A THE WATERMARK | TEMPE DEVELOPER: Fenix Development GENERAL CONTRACTOR: Okland Construction ARCHITECT: Nelson Partners BROKERAGE: Cushman & Wakefield LOCATION: SWC of Scottsdale Road & Loop 202, Tempe SIZE: 1.9 MSF VALUE: $135M START: June 2017 COMPLETION: (Phase 1) Fall 2018

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MULTIFAMILY B CENTRAL AND WILLETTA DEVELOPER: Ryan Companies U.S., Inc. GENERAL CONTRACTOR: Ryan Companies U.S., Inc. ARCHITECT: Studio Meng Strazzara LOCATION: Central Avenue & Willetta Street, Phoenix SIZE: 293,000 SF VALUE: WND START: June 2017 COMPLETION: September 2018

MIXED-USE C CRISMON GATEWAY VILLAGE DEVELOPER: FWD Partners GENERAL CONTRACTOR: Venn Construction (formerly RJM Construction) ARCHITECT: Architekton BROKERAGE: SVN Desert Commercial Advisors LOCATION: Crismon & Baseline roads, Mesa SIZE: 22,500 SF retail; 25,000 SF office; 128-unit multifamily VALUE: $26M START: May 2017 COMPLETION: Q4 2017


C

B

F

SELF-STORAGE D MVP STORAGE SCOTTSDALE DEVELOPER: Monolith Capital Group GENERAL CONTRACTOR: Zzone Construction ARCHITECT: Andrews Design Group BROKERAGE: Cohen Financial LOCATION: 1650 N. Pima Rd., Scottsdale SIZE: 126,700 SF VALUE: $15.6M START: May 2017 COMPLETION: Early 2018

MIXED-USE E TURBO RESOURCE DEVELOPER: N/A GENERAL CONTRACTOR: Layton Construction Company ARCHITECT: McCall & Associates Architects LOCATION: 2615 N. Arizona Ave., Chandler SIZE: 253,000 SF VALUE: WND START: June 2017 COMPLETION: Q1 2018

INDUSTRIAL F CAVE CREEK 101 DEVELOPER: Greenwood & McKenzie GENERAL CONTRACTOR: Sun State Builders ARCHITECT: Winton Architects BROKERAGE: Lee & Associates LOCATION: 2950 E. Mohawk Ln., Phoenix SIZE: 54,430 SF VALUE: $5.25M START: Fall 2016 COMPLETION: May 2017

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The rise of secondary and teritary markets $950 million portfolio deal includes high-profile Tempe property By DAVID MCGLOTHLIN

F

oreign investors are taking measured risks in secondary and tertiary markets in order to secure yield premiums on their investments that are unavailable in more traditional gateway markets. Historically, foreign investments into the United States real estate market have predominately involved assets and projects in gateway markets like, San Francisco, Los Angeles, New York and Boston. The recent $950 million portfolio deal for 48 properties across 20 states signifies a shift in foreign investment strategy away from traditional gateway markets and into secondary markets like Phoenix. China Life, one of China’s largest insurance companies, partnered with ElmTree Funds, a St. Louis-based real estate private equity firm, for a 95-percent stake in its single-tenant net lease portfolio totaling more than 5.5 million square feet across the U.S. Following the close of the deal, China Life and ElmTree will jointly manage the properties. That includes the two-story, 150,000-square-foot GoDaddy Global

16 | July-August 2017

Technology Center at the ASU Research Park, which was built by Ryan Companies in 2014 and is currently fullyleased. Chris Toci, executive managing director Chris Toci of Cushman & Wakefield’s Capital Markets Group, has nearly 20 years of experience with investment sale transactions including deals executed with each of the top three investment managers in the world: Clarion Partners, Prudential Real Estate Investors and RREEF. When asked about the significance of the deal and potential greater market implications, he says, “The trend that you’ll see is more capital making its way into secondary markets like Phoenix.” Rather than buying a 1.8-millionsquare-foot office tower in Manhattan, N.Y. for $1.65 billion like China Life did last year, a large single-tenant net lease portfolio of assets in secondary and tertiary markets like this $950 million deal may generate 6-8 percent yields. While an investor may get 4-5 percent yields on a $1,000 per square foot office building in San Francisco, Toci asks, “Then where do you go from

GoDaddy Global Technology Center there? Do you sell it for $2,000 per square foot?” Instead, they are choosing to target the 2-3 percent premiums in a secondary market like Phoenix, he explains. The cause that Toci points to was the aggressive buying activity in gateway markets during the post-recession, which drove cap rates way down and ultimately improved investment opportunities in secondary markets. For select assets and quality product like the GoDaddy facility in Tempe, Toci says, “You’re going to see more investor interest because everyone is starved for yield so they need to get some sort of premium.” Greater Phoenix is one of these secondary markets in a good position to capitalize on increased investments as the local market experiences declining vacancies and rising rental across most product types. “There’s a very good story unfolding for Phoenix,” says Toci, “We firmly believe Phoenix will do what it always does, which is grow aggressively.” He is encouraged by the restriction on supply deliveries compared to previous cycles, absorption increases and rising rent rates. “It’s been a long time coming,” he adds.


It’s the big deals and the brokers who close them that make the market an interesting one to watch. Here are the Top 5 notable sales for the months of March, April and May in 2017. Sources: Cushman & Wakefield and Costar.

INDUSTRIAL/SALES

OFFICE/SALES

402 S. 54TH PLACE, PHOENIX 248,900 SF; $20.5M BUYER: Young’s Market Company LLC SELLER: First Beverage Capital BROKERAGE: JLL

GODADDY GLOBAL TECHNOLOGY CENTER 2155 E. Go Daddy Way, Tempe 6,514,036 SF; $950M BUYER: ElmTree Funds SELLER: ElmTree Funds

3555 & 3602 W. WASHINGTON ST., PHOENIX 325,424 SF; $18.7M BUYER: Colony Northstar Inc. SELLER: American Realty Advisors BROKERAGE: JLL

500 W. THOMAS RD., PHOENIX 591,551 SF; $150M BUYER: Healthcare Trust of America, Inc. SELLER: Heitman

DISCOVERY BUSINESS CENTER 2100 & 2108 E. Elliot Rd., Tempe 471,163 SF; $17,418,896 BUYER: JP Morgan Chase & Co. SELLER: Wentworth Property Company BROKERAGE: CBRE NORTHWEST BUSINESS CENTER 9014-9034 N. 23rd Ave., 9013 N. 24th Ave. & 2310-2440 W. Mission Ln., Phoenix 226,645 SF; $17.2M BUYER: BKM Capital Partners SELLER: TA Associates, Inc. BROKERAGE: Cushman & Wakefield PARC 17 1800-1880 S. 7th Ave., Phoenix 177,770 SF; $16.1M BUYER: Colony Northstar Inc. SELLER: Jackson-Shaw Company BROKERAGE: Lee & Associates

GALLERIA CORPORATE CENTRE 4301 & 4343 N. Scottsdale Rd., Scottsdale 538,074 SF; $142.5M BUYER: Stockdale Capital Partners SELLER: Oaktree Capital Management LP DISCOVERY BUSINESS CENTER 2104 & 2118 E. Elliot Rd., Tempe 299,185 SF; $45,759,765 BUYER: JP Morgan Chase & Co. SELLER: Wentworth Property Company BROKERAGE: CBRE DISCOUNT TIRE COMPANY CORPORATE OFFICE 20225 N. Scottsdale Rd., Scottsdale 157,566 SF; $40.18M BUYER: Discount Tire SELLER: Holualoa Companies BROKERAGE: Colliers International

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LAND/SALES

MULTIFAMILY/SALES

IMAGERY ©2017 GOOGLE

RETAIL/SALES

IMAGERY ©2017 GOOGLE

E. INDIAN BEND RD. & N. MOCKINGBIRD, PARADISE VALLEY 1,039,017 SF; $45M BUYER: Shea Homes LP SELLER: Five Star Development Resort Communities LLC

ANDANTE APARTMENTS 15801 S. 48th St., Phoenix 510,516 SF; $85.25M BUYER: Security Properties Inc. SELLER: Waterton Associates LLC BROKERAGE: CBRE

SCOTTSDALE TOWNE SQUARE 13802-14046 N. Scottsdale Rd., Scottsdale 162,259 SF; $31M BUYER: Woodbury Corporation SELLER: Holualoa Companies BROKERAGE: CBRE

N. SARIVAL AVE. & W. SELLS DR., GOODYEAR; W. SELLS DR. & N. SARIVAL AVE., GOODYEAR 10,107,968 SF; $26,346,578 BUYER: First Industrial Realty Trust Inc. SELLER: Sunbelt Holdings BROKERAGE: Colliers International

INDIGO CREEK 14221 N. 51st Ave., Glendale 402,000 SF; $55.2M BUYER: Resource Real Estate SELLER: The Bascom Group BROKERAGE: Marcus & Millichap

14175 W. INDIAN SCHOOL RD., GOODYEAR 107,633 SF; $22.45M BUYER: Sterling Organization SELLER: Public Employees Retirement

LAKES TOWNE CENTER 777 E. Baseline Rd., Tempe 452,179 SF; $22.7M BUYER: YFP Management Co. SELLER: Kitchell Development Co. BROKERAGE: Marcus & Millichap DISCOVERY BUSINESS CENTER E. Elliot Rd. & 2116 E. Elliot Rd., Tempe 446,054 SF; $16,490,616 BUYER: JP Morgan Chase & Co. SELLER: Wentworth Property Company BROKERAGE: CBRE E. ELLIOT RD. & SIGNAL BUTTE RD., MESA 2,458,962 SF; $12,240,360 BUYER: Dupont Fabros Technology SELLER: LKY Investments LLC

Regents On University:

The four-story apartment community, built in 2010, totals 255 units and was sold for $52.975 million on March 1.

18 | July-August 2017

REGENTS ON UNIVERSITY 1949 E. University Dr., Tempe 264,555 SF; $52.975M BUYER: Preferred Apartment Communities SELLER: Consolidated Investments Group BROKERAGE: CBRE THE VIEW AT CASCADE 18525 N. Scottsdale Rd., Scottsdale 153,430 SF; $50.05M BUYER: Private Portfolio Group LLC SELLER: P.B. Bell Companies BROKERAGE: CBRE 505 WEST APARTMENT HOMES 505 W. Baseline Rd., Tempe 286,168 SF; $37.25M BUYER: Aragon Holdings LLC SELLER: Fowler Property Acquisitions LLC BROKERAGE: Transwestern

13810 & 13840 W. CAMELBACK RD., LITCHFIELD PARK 18,800 SF; $9.675M BUYER: John L. Garland Residuary Trust SELLER: Evergreen Development Co. BROKERAGE: Cushman & Wakefield 29455 N. CAVE CREEK RD., CAVE CREEK 29,460 SF; $9.45M BUYER: A & C Properties Inc. SELLER: Westwood Financial Corp. BROKERAGE: Cushman & Wakefield 15557-15609 W. BELL RD., SURPRISE 64,193 SF; $9.3M BUYER: 15601 Bell Rd LLC SELLER: Macayo DeRito-P Retail 1 LLC


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We are Celebrating the Industry Leaders in:

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19


LEGISLATIVE UPDATE

Advocating for responsible development Valley Partnership’s 2017 legislative victories

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n May 10th, the Arizona Legislature concluded its session after 1,079 bills were originally introduced, 353 were passed, and 342 were signed into law. From the bigpicture, business perspective it was a good session. One of Gov. Doug Ducey’s biggest priorities, university bonding, was passed, which enables approximately $1 billion in new investments to be directed toward research and development infrastructure at Arizona State University, University of Arizona and Northern Arizona University. This includes the development of research infrastructure needed to secure Arizona’s competitive advantage in a global economy. We also saw tax credits for an enhanced manufacturing environment, and one of Valley Partnership’s priorities, the funding of Highway User Revenue Fund (HURF) to provide much needed dollars for transportation. For the real estate development industry, we now have clarity on the number of property owners’ necessary to file a rezoning protest, along with

20 | July-August 2017

Cheryl L. Lombard Valley Partnership

bills that Valley Partnership helped negotiate and ultimately pass to update the Community Facilities District (CFD) and Government Property Lease Excise Tax Program (GPLET). Specifically, for GPLET reforms, Valley Partnership helped lead negotiations between the Arizona Tax Research Association (ATRA), cities and the development community to a solution that shortens the time frame for a tax abatement in certain areas. Unfortunately, even with the consensus agreement, the future of GPLET is

uncertain with the Goldwater Institute filing a lawsuit on the overall program. Finally, Valley Partnership awarded its first annual Legislators of the Year at our May Friday Morning Breakfast event. This year’s honorees, State Senator Bob Worsley and Representative Vince Leach, helped lead a successful session for the business community. Rep. Leach played a critical role in the GPLET and CFD reforms. Sen. Worsley, chair of the Transportation Committee, was critical in securing additional resources for HURF and concepts on how we can fund transportation into the future. Valley Partnership will continue and grow its presence at the Arizona Legislature and with key state agencies to advocate for responsible development. This will likely include more legislation on taxes, how to pay for infrastructure – especially our needed transportation investment, and other legislation to keep growing Arizona’s economy. Cheryl Lombard is the president and CEO of Valley Partnership.


Legislature adjourns with action on GPLET and university funding

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he Arizona Builders Alliance (ABA) is the commercial construction industry’s leading advocate at the State Legislature. Areas of focus include public works procurement, taxation, labor, liens, prompt payment and safety. This year was no exception. Here are some of the items ABA worked on during this session:

GOVERNMENT PROPERTY LEASE EXCISE TAX Arizona is one of many states that has a tax abatement system known as the Government Property Lease Excise Tax (GPLET). The GPLET system has helped many developers to invest in run-down parts of our cities, but has been a target of tax watchdog groups because of the tax shifting that occurs, and the unequal treatment of similar properties. This year, HB 2213 was introduced, which limited a developer’s ability to utilize GPLETs for future projects. The ABA and others worked to find a compromise. The final bill returns school taxes to the assessment and limits the time period for all abatements. The remainder of the GPLET system is intact and available for property owners to use on future projects.

BONDING FOR UNIVERSITY CONSTRUCTION PROJECTS Gov. Doug Ducey’s State of the State Address included a proposal to allow

TPT REFORM FOR CONTRACTORS

Mark Minter

Arizona Builders Alliance state universities to fund construction and repair work by capturing state sales tax revenue from university activities. This proposal was “dead on arrival.” But Gov. Ducey continued to work with the Legislature and they ultimately passed a budget including General Fund commitments to a 30-year, $1 billion bond plan. Expect to see work progressing within months on some of these projects.

The ABA has been working for a number of years to eliminate the prime contracting tax classification due to its confusion and risk. The ABA’s efforts included working with Rep. Regina Cobb in recommending the industry move toward a “point-ofsale” system. HB 2521 created an excise tax to be shared among cities based on their level of construction. This was proposed to help some cities who might lose revenue. The move to point-of-sale has been opposed by the Arizona League of Cities, who fear tax loss in cities where construction activity occurs, but lack material supply outlets. In February, the bill failed to move forward after passing the House Ways and Means Committee, but will probably be back in 2018, with further refinements. Mark Minter is the president of the Arizona Builders Alliance. 21


LEGISLATIVE UPDATE

Water: Life, commodity and Arizona’s future W

hether a multi-generational native or a transplant to the Grand Canyon State, residents understand the power water has on life and livelihood throughout Arizona’s arid environment. Averaging less than 10-inches of rainfall per year, Arizona maintains a dependency on groundwater for more than 40 percent of its water supply. From Hohokam stone canals to today’s complex water delivery network, effective management of water resources will continue to be integral to the growth and development of the Salt River Valley. A long history of collaboration catalyzed the founding of the Salt River Project (SRP), the construction of the Central Arizona Project, and the passage of the Groundwater Management Act signed by Governor Bruce Babbitt in 1980 - three legacy endeavors that catapulted Arizona to the forefront of successful water resource management. As population increased throughout the Phoenix Metropolitan region, a new benchmark was reached in 1984 when, for the first time in history, 55 percent of SRP’s water deliveries were dedicated to urban water use. Water usage for agricultural purposes had finally been surpassed. As a testament to Arizona’s widely-

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Deb Sydenham

ULI Arizona District Council known efforts in water resource management, an international delegation representing nine African countries recently met with representatives of the ULI Arizona District Council to learn how the state manages water resources in an urban environment that is arid and similar to their home. The delegates were participants in the U.S. State Department’s International Visitor Leadership Program (IVLP), established in 1940, and were hosted locally by Global Ties Arizona. However insurmountable the challenges shared by the delegation seemed to be, it was clear that hearing the story of Arizona’s water management history offered new hope where none had previously existed. While the topic of water resource

management is of utmost importance to Arizonans, a 2016 ULI and PwC Emerging Trends in Real Estate survey concluded that on the whole, the real estate development industry is lukewarm on how water regulations, water conservation, energy prices and sustainable building practices might affect their business when compared to job growth and construction costs. As municipalities implement strategies to address water use and sustainability, understanding the potential real estate and economic development impacts becomes imperative. The historic drought afflicting the West could significantly impact Arizona’s water resources over the next 20 to 50 years. Thankfully, institutions and entities such as ASU, the Morrison Institute for Public Policy, the Kyl Center for Water Policy, SRP, ULI and others, have conducted extensive research and published numerous factual articles that build upon Arizona’s water resource management legacy and will help the state prepare for the future. Adaptation is Arizona’s wheelhouse, and the key to maintaining our competitive advantage. Deb Sydenham, FAICP, is the executive director of ULI Arizona District Council.


Impactful legislation for economic development A

rizona’s 2017 legislative session ended May 10th with a number of wins, including some very good news for the state’s economic development. The 53rd Arizona Legislative Session impacted statewide economic development in a multitude of ways, large and small. While there were several individual wins including the funding of the Angel Investment Tax Credit (HB 2191), one bill stood out. SB 1416 is referred to as “The Quality Jobs Bill.” The bill, which gives individual private-equity investors state credits on qualifying investments, was signed into law this spring. The Arizona Association for Economic Development (AAED) believes this new legislation will help Arizona maintain its position as one of the nation’s leaders in job creation. In order to remain competitive, Arizona must stay competitive in its ability to attract, retain and grow businesses with quality jobs for our citizens, now and into the future. AAED believes that SB 1416 will enhance Arizona’s manufacturing competitiveness moving forward. SB 1416 highlights:

Quality Job Tax Credits through 2025

• Modifications made to Minimum Capital Investment/Minimum Number of New Jobs/Percent of County Median Wage for factoring tax credit • Different thresholds for job creation with urban having a minimum of 25 net new jobs and rural with five Research & Development Tax Credit continues through 2021

• Current rates are set to decrease in 2018 Transaction Privilege Tax – Public Infrastructure

• Stipulation of no funds distribution until 10-percent of qualifying capital investment has been made by the manufacturing facility

• Clarifies how a taxpayer can claim all five annual installments of the qualified Facilities Tax Credit that was preapproved by the Arizona Commerce Authority (ACA)

Rep. Jill Norgaard, who delivered the final votes. This bill was presumed dead numerous times, but their dedication paid off and the bill found success on the final day of the session. Our community partners, headed by Arizona Chamber of Commerce & Industry, Arizona Technology Council, Arizona Bioindustry Association and the ACA, provided excellent teamwork. AAED joined the ranks with a call for action that included outreach, letter writing and calling campaigns from economic developers and service providers around the state. Economic development had a winning year in 2017 and is grateful for the economic development tools the state of Arizona has given us. The 470 statewide members of AAED, through our policy advocate the Dorn Policy Group, will be at the Capitol next year to support bills that enhance the economy of Arizona through responsible economic development.

The winning team’s roster for economic development includes: the bill’s sponsor Rep. Jeff Weninger and

Joyce Grossman, AZED Pro, is the executive director for the Arizona Association for Economic Development.

Joyce Grossman AAED

Accelerated Depreciation for Class 6 Property

• Allows accelerated depreciation of personal property in a foreign trade zone or military reuse zone Qualified Facilities Tax Credit

23


LEGISLATIVE UPDATE

NAIOP-AZ outlines legislative focus for next year’s session

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he 2017 Legislative Session of the Arizona State Legislature ended May 10th, after 122 days of debate over 1,079 bills – marked most notably by the passage of a $9.8 billion budget that included approval of an additional $1 billion in bonding authority for Arizona’s three state universities. NAIOP-AZ members will benefit from the additional bonding, which the universities will largely use to develop new research and university facilities that will attract new businesses and boost Arizona’s economy. For NAIOP-AZ, however, the most notable event of the session was the successful protection of key provisions of the Government Property Lease Excise Tax (GPLET) statutes, which opponents attempted to eliminate or drastically reduce. GPLETs have been an effective economic development tool in Arizona, but came under fire most recently due to concerns raised in a 2015 Arizona State Auditor General’s report over

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Molly Ryan Carson NAIOP

indications of inaccurate reporting and improper calculation of GPLET rates owed by lessees. In response to the report, GPLET opponents introduced House Bill 2213, which would have addressed the audit findings as well as drastically reduced the property tax abatement provisions of the GPLET tool. NAIOP-AZ led the fight against the introduced version of HB 2213, and played an instrumental role in leading and cobbling together a compromise

bill that retains the GPLET tool in the commercial real estate industry’s economic development toolbox. In its final form approved by Gov. Doug Ducey, HB 2213 ensures accountability through better reporting and accurate calculation of GPLET rates, grandfathers certain GPLET deals between cities, developers and businesses, and on a going forward basis allows the GPLET tool to be used to abate property taxes for up to eight years. A win-win for the Greater Valley and Arizona. Looking forward, NAIOP-AZ will continue its long history of supporting efforts to attract quality jobs to Arizona. Specifically, we will continue to oppose mandated commercial real estate cost increases; support property tax reform and assessment ratio equity to make our state more economically competitive, support efforts to responsibly retain tools in the economic development tool box; support efforts to streamline our onerous and uncompetitive sales tax system; support efforts to improve our K-12 education system and ensure more accountability; and support efforts to improve community involvement and workforce development. Molly Ryan Carson is chair of the NAIOP National Political Action and NAIOP-AZ Public Policy committees.


Two key bills passed for the apartment industry

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fter 122 days, the Arizona Legislature adjourned sine die on May 10. A total of 1,079 bills were introduced this year and roughly a third of those bills were approved by the legislature. While 300 new laws passed in 100-plus days might give one pause for thought, many of the new laws were aimed at rolling back regulation or clarifying existing law. This year the Arizona Multihousing Association (AMA) was successful in passing two key pieces of legislation on behalf of the apartment industry. The first bill, HB 2039 introduced by Rep. Jeff Weninger, will authorize apartment managers to provide unlimited finder fees, also known as “referral fees,” to their residents. Apartment referral fees are rent credits issued to residents who refer their friends or family members to the property. Prior to the bill’s passage, operators were limited to providing only a $200 rent credit, and managers could only award the rent credit up to five times in a given year. While HB 2039 lifts the monetary restrictions, it does maintain all of the

Courtney LeVinus and Jake Hinman Capitol Consulting

existing provisions designed to keep the person receiving the referral fee from showing the apartment unit to a prospective lessee, discussing the leasing terms and conditions, and participating in the negotiation of a lease. Arizona will now join only a handful of states that allow apartment operators to provide unlimited referral fees to residents. The AMA’s second bill, HB 2237 introduced by Rep. Eddie Farnsworth, will prohibit any court or agency from requiring specific forms for notices or pleadings in any residential landlord and

tenant relationship. The AMA sought this legislative solution after a proposal was introduced to require all landlords and tenants to use forms created by the court system for all of notices and pleadings. This would have included anything from a notice of a breach of the lease agreement to a tenant notifying the landlord of a broken A/C unit. The AMA was concerned that any use of mandatory forms would have had the unintended consequence of making the communication between the landlord and the tenant more confusing by creating an additional and impractical regulatory barrier. The AMA was doubly concerned that had the legislature not intervened with this new law, both landlords’ and tenants’ rights and remedies provided by state law would have been subverted by technical deficiencies created by specific forms created by an agency or court. Courtney LeVinus is president and Jake Hinman is the director of government relations for Capitol Consulting. 25


INFRASTRUCTURE

Planes, trains & automobiles

The infrastructure tools propelling the Valley’s economy forward By JESSE A. MILLARD

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ou can’t get going without something to guide you forward, and as the Valley moves forward into its next economic chapter, vital pieces of infrastructure are needed to help grease the wheels of economic development. Funding is still an issue, but there are many funded projects already under construction focused on Metro Phoenix’s infrastructure for its planes, trains and automobiles. Phoenix Sky Harbor International Airport is in the process of spending $2 billion on upgrades. Phoenix’s 2015 passage of the transit tax from Prop. 104 is making way for decades’ worth of light rail and bus expansions, which will reach parts of the Valley that will even surprise the most optimistic transit lover. And the freeways? The Loop 202 expansion could be a game changer for the Valley. Here’s a breakdown of some vital infrastructure projects happening right now:

PLANES The second of three phases for Sky Harbor’s Terminal 3 Modernization project is currently underway after it re-opened to the public in December. The modernization will replace all of Terminal 2’s gates, eventually paving the way for its razing.

Development oppurtunites at

Phoenix-Mesa Gateway Airport

TERMINAL 3 MODERNIZATION: Sky Harbor reported the approximate cost of the entire project at $590 million, including $150 million for phase one.

Sky Harbor isn’t the only airport in the Valley that is heating up with improvements. After two recent dealings, 1,000 acres of land around the Phoenix-Mesa Gateway Airport is ripe for development. Earlier this year, the Gateway Airport worked out a deal with a master developer to start building on 350 acres of land south of the airport. Meanwhile, the Federal Aviation Association gave the airport a finding of “No Significant Impact” for 700 acres on the northeast side of the airport, which paves the way for future development on the 700 acres. 27


INFRASTRUCTURE Terminal 3’s gates will become more efficient as airlines will share underutilized gates, says Art Fairbanks, special projects administrator for the Terminal 3 Modernization project. “This economic engine that feeds all of our tourism and business community here in town can benefit from more traffic, because with the same number of gates we can get greater utilization,” he explains. The modernization is slated for completion in 2020, and when everything is complete the terminal’s capacity space will increase to 25 gates. Also at Sky Harbor, the second phase of the SkyTrain is underway. Once complete, the SkyTrain will connect the remaining Sky Harbor VALLEY METRO RAIL: The planned 66-mile high capacity transit system will help future growth and mobility as the Valley’s population expands and communities become more dense. PROVIDED BY VALLEY METRO

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facilities together while also creating smoother transitions for travelers from the plane to their rental car or vice versa, says Kyle Kotchou, aviation director for design and construction services at Sky Harbor. The SkyTrain will reach a new west economy lot and the rental car facility once the SkyTrain additions are finished in late 2021 or early 2022.

TRAINS Train may be in the SkyTrain’s name, but there are other train, or rail, related infrastructure additions moving forward in the Valley. Currently under construction, the 1.9-mile light rail extension on Main Street from Mesa Drive to Gilbert Road is a “big deal,” says Eric Anderson, transportation director at the Maricopa Association of Governments. Since the start of service in 2008, the 26-mile Valley Metro Rail line has generated nearly $9 billion in economic investment including residential and

commercial developments. Anderson thinks the extension will dramatically increase ridership and the redevelopment potential along the extension is high, Anderson says, as there are many abandoned retail assets along the line. The Phoenix Transportation 2050 Plan, made possible by Prop. 104, will add 42 miles of light rail across the city, including the South Central light rail extension, which will extend to Baseline Road by way of Central Avenue by 2023. In Tempe, construction started on June 1 for its local Street Car, which will wrap around ASU’s campus and reach Hayden Ferry Lakeside and Marina Heights.

AUTOMOBILES The Loop 202 extension, which will “complete the loop,” adds 22-miles of freeway to the existing transportation system. Anderson says this connection will


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LOOP

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10 Van Buren Street Buckeye Road Lower Buckeye Road Broadway Road Southern Avenue

60 Baseline Road Dobbins Road

10

Elliot Road

LOOP

202 48th Street

40th Street

32nd Street

24th Street

17th Avenue

Pecos Road

LOOP 202: A public-private partnership agreement with Connect 202 Partners was reached for the final design, construction and 30-year maintenance plan of the South Mountain Freeway extension. PROVIDED BY ARIZONA DEPARTMENT OF TRANSPORTATION

ease the access between the Southeast and Southwest parts of the Valley, connecting many folks to the high-tech jobs in the Southeast. During Phoenix Mayor Greg Stanton’s State of the City Address, he mentioned the creation of a South Mountain Technology Corridor, which will try to convince advanced manufacturing and emerging industries to locate along the expansion once it’s finished by late 2019. The creation of these high tech jobs in the Southwest part of the Valley, in places like Laveen, will be able to draw from the talented workforce pool in the Southeast Valley, Anderson says. “I think [the high tech corridor] is going to change some of the dynamics in the Valley,” Anderson explains. “Hopefully it will lead the creation of better jobs in the west side of the Valley.”

Eric Anderson

Art Fairbanks

Kyle Kotchou

Cheryl Lombard

Battle for fully funded HURF goes on Valley Partnership, in a coalition with the Arizona Chamber of Commerce, Arizona General Contractors and Arizona Rock Products Association, worked to restore full funding to the Highway Revenue User Fund during this year’s legislative session. HURF is used by cities, towns and counties to fund state highway construction, imporvements and related expenses. Currently, the Arizona Department of Transportation is in the midst of a $62.7 billion budget shortfall from 2010 to 2035, according to a 2015 report by the Arizona Office of the Auditor General. Valley Partnership President and CEO Cheryl

Lombard and her coalition have been beating the drum on how important infrastructure is for economic development. And this past year, there were many great voices in the legislature beating the same drum, Lombard said. One of this year’s legislative budget successes includes a one-time $30 million deposit of Highway Expansion and Extensional Loan Program Fund monies going to local HURF for distributions in Fiscal Year 2018 and 2019. Next year, or the following, may be the year Arizona starts playing with a fully funded HURF, Lombard says.

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CONSTRU-TECH

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Constru-TECH The latest technologies shaking up how projects are planned, scheduled and built By DAVID MCGLOTHLIN

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ver the last ten years, innovations in technology have disrupted many of the industries across the world allowing for improved efficiency, savings and quality. The construction industry is no different. Although, Jim Rogers, a wellknown construction management and industry expert, says, “Construction lags behind other industries like manufacturing that have more quickly adopted and implemented new technology to improve the industry.” But that’s changing as innovations like 3-D laser scanning, building information modeling (BIM), digital drawings, virtual reality (VR), augmented reality (AR), 3-D printing and others are enabling incredible improvements in the construction industry from communications to improved quality, production, savings and safety. In Dubai, the world’s first functioning 3-D printed building was completed in May by using a massive 3-D printer and a special mixture of cement to create a 2,700-square-foot office building in 17 days for about $140,000. Meanwhile in Arizona, the use of integrated project delivery methods, virtual design and construction (VDC) teams and digital project plans are speeding up Jim Rogers 31


CONSTRU-TECH construction timelines and cutting down on costs. There’s also augmented and virtual reality applications that redefine how we can look at projects and interact with spaces before it is ever constructed. New technologies are forcing construction companies to adopt these innovations in order to stay competitive, which means adjusting the ways it plans, schedules and builds a project. Rogers says, the biggest impact on the construction industry is the fact that there’s a lot of stuff that we have to go and re-learn in order for these technologies to propagate throughout the field. From what he sees and hears throughout the industry, Rogers explains, “General contractors are in the mode of learning all different kinds of training, construction management, professional development systems and

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tools within their organizations to keep up with all of these new changes, trends and technologies, which will be critical for them to stay on top.” These are some of the new innovations transforming the construction industry and the companies at the forefront of the “constru-tech” movement.

ARCHSOL

ARCHSOL designed several custom radiochemistry facilities across the nation that are facilitating innovative healthcare treatments including a new building at a cancer clinic’s campus in Scottsdale for a radiochemistry laboratory and complex piece of equipment called the cyclotron, which is a high-energy particle accelerator used in the production of radiopharmaceuticals. The design and construction of the building required a specific density for the cyclotron’s

concrete shielding and precise coordination of underground conduits for pneumatic system transport of radioactive isotopes, that have a halflife of as little as 20 minutes, to the patient point of care.

BALFOUR BEATTY CONSTRUCTION

By using Bluebeam Extreme, project drawing sets are constantly updated as changes are made to all project documents including drawings, specifications, requests for information, architectural supplemental instructions, as-built drawings and others are hyperlinked to the Balfour Beatty dashboard and instantly updated, which are accessible

Cyclotron: a high-energy particle accelerator. IMAGE COURTESY, ARCHSOL


Balfour Beatty Construction: BIM 360 Field by Autodesk

anywhere on the jobsite through the employee’s electronic tablets. The BIM 360 Field by Autodesk — a field management software for 2-D and 3-D environments that combines mobile technologies at the construction site with cloud-based collaboration and reporting — helps the project team maintain logs of issues, creates checklists for safety and tracking punch list items.

CLIMATEC

Climatec’s Axcess suite was built to transform the tremendous amounts of data that building systems generate into actionable intelligence. It leverages deep engineering expertise, advanced analytics and visualization technologies to optimize building performance and reduce operating costs, which Terry Keenen, president of Climatec, says, helps clients realize a greater return on their building investments. At multiple healthcare and government municipality projects already integrating multiple building subsystems and vendors, Climatec’s data visualization and analytics have generated $500,000 in annual savings and the optimization of systems added another $750,000 in annual savings.

DPR CONSTRUCTION

Virtual reality, laser scanning and prefabrication are the latest innovations being used at DPR. VR and AR technology puts the user into a virtual architectural model so they can digitally experience the space and interact with it without the costly investment of building a full scale, physical mock-up. Laser scanning as a Quality Assurance/Quality Control (QA/QC) tool ensures 1/8-inch accuracy and saves DPR projects $1 per squarefoot in field rework due to human error. Meanwhile, the prefabrication process

DPR Construction: Installing prefabricated panels 33


CONSTRU-TECH general manager, says, “These two new products help protect the building and its occupants by being non-combustible and at the same time reducing the cost of installation due to the high speed in which they can be installed.”

GRAYCOR

Eco 3-D: Processing facility

used for the installation of the exterior skin panels at the Banner University Medical Center Phoenix's 16-story patient tower process increases safety by not having to work from scaffolding, reduces schedule durations by placing one level of panels in a day, and achieves consistent quality by working in an assembly-line like manner.

ECO 3-D

Using laser scanners to create highly accurate digital 3-D models reduces labor, material costs and the amount of re-work while aiding in schedule compression and mitigating costly requests for information, which helped the company’s VDC team save millions for clients like Walmart, New York University, Cushman & Wakefield and the Los Angeles International Airport. “The implementation of laser scanning and 3-D modeling is the next revolution in the construction world. Sensational cost reductions and efficiencies will be realized,” explains Ken Smerz, president and founder at Eco 3-D. “The owners will begin to take this information to digitally manage their assets all the way back into their income statements.”

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FAIRVIEW ARCHITECTURAL NORTH AMERICA Vitrabond G2, a light weight non-combustible metal composite material for building façades, was launched by Fairview Architectural North America in March along with the Arrowhead suite of façade panel installation systems, which were designed and engineered to package all the benefits of a traditional metal composite material. Jerry Fossey,

Before and during construction, Graycor utilizes drones to gather accurate data and information about a site or existing structure. During pre-construction, a 30-minute drone flight, plus a few hours of information processing, can compare actual site elevations to a design plan, providing precise data for earthmoving activity, creating construction timelines and establishing budgets with trade vendors. During construction, a program called Drone Deploy uses photogrammetry to accurately compare the design plan to a project’s actual as-built conditions, which includes 3-D and virtual reality capabilities. Other client-facing advantages of drones include in-progress aerial photos, flythrough visuals and live feed options, which are a particular benefit for out of town developers.

Graycore: Site assesment


JE Dunn Construction: mobile jobsite kiosk

Residents can also expand their capabilities with upgraded packages including video cameras, CCTV cameras and entertainment packages. This comes on the heels of Mark-Taylor’s roll-out of Amazon Locker technology throughout its Arizona portfolio, easing the burden of package delivery for property management offices and residents.

MODUS DEVELOPMENT

JE DUNN CONSTRUCTION

The Dunn Dashboard is a project specific collaboration website that enables projects teams, including the owner, architect and trade partners, to access all project documents and information in real time. It enables a paperless construction jobsite by using mobile jobsite kiosks, digital plan tables, tablets, smartphones and laptops to access and update information such as contract documents, RFIs, submittals, administrative documents, 3-D models, calendars, photos, project web cams, construction documents, project announcements and much more. John Jacobs, chief information officer, describes it as a “single source of truth” that supports 600 active construction projects.

uses an Assemble Systems program to create visual comparisons with precise illustrations for project designers and owners the direct cost of construction changes and corresponding financial impacts.

MARK-TAYLOR RESIDENTIAL

Vistara at SanTan Village in Gilbert marked the first apartment community in Arizona to offer remote, mobile-device enabled technology to its residents through an app that remotely control locks, temperature and lighting through a partnership with Clare Controls.

By working with a RESNET approved HERS Rater to perform energy use models using REMrate software, MODUS is able to develop the most cost effective building envelope for optimal energy efficiency. A proprietary database was created to measure the cost/benefit in HERS points for each sustainable item used in the building such as spray foam insulation, LED lighting, hybrid hot water heaters and more. Ed Gorman, founder and president, says, “Utilizing energy modeling tools and developing a database of cost and savings has allowed us to successfully build the first Net Zero Energy (NZE) townhomes in the state and the first NZE apartment building in the country.”

Kitchell: Kapture off-site prefabrication and virtual design facility

KITCHELL

Kitchell’s prefabrication and virtual design unit — the Kapture Group, a collaboration with MKB Construction — is a 42,000-square-foot facility enabling the design and build of certain aspects of construction projects in an assembly-line like process. “These are tools that enable us to use our resources wisely, save clients millions of dollars and shave weeks, and in several cases, months from a construction schedule,” says Scott Root, director of Kapture. Kitchell’s preconstruction team also 35


CONSTRU-TECH Ryan Companies: 3-D coordinated model

P.B. BELL

P.B. Bell partnered with Cox Communications to offer residents at Escape in Phoenix access to a Smart Home experience through Cox Homelife, which features home automation capabilities, such as live video viewing and energy controls for temperature and lighting. At Solis at Towne Center, P.B. Bell partnered with Parcel Pending to offer 24-hour, automated parcel storage allowing residents to retrieve packages, which were installed in May. “These secure, automated lockers offer flexibility and convenience for residents, and we’re proud to be able to offer this type of amenity to accommodate a growing need,” says Chapin Bell, CEO at P.B. Bell.

PROCORE & PLANS4LESS

For smaller mom-and-pop companies, building information modeling may not be an affordable option, which means printed documents are still a must. However, the most widely-used construction management software firm, Procore, has teamed up with Plans4Less, on a first of its kind app for printing and delivering construction documents that’s affordable and quick. In fact, all Procore software users now have the

advantage of printing and delivering full-sized construction documents from Plans4Less for $1 each to anywhere in the country by the next day using a seamlessly integrated app.

RYAN COMPANIES

Since 2012, its Virtual Design and Construction (VDC) team worked to transform a design concept into an image, animation or virtual reality in order to bring that concept to life through 3-D building animations and renderings, cost and schedule summary infographics, site logistics, process maps and through regional amenity marketing summaries. Today, Rick Collins, regional president at Ryan

TruePoint Laser Scanning: Building laser scan

Companies, says, “With our Virtual Design and Construction program, we ‘build’ the building technologically, before we put a shovel in the ground. Our VDC group continues to push the boundaries of VR in providing valuable content and prospective clients; allowing our users to ‘see’ the completed building to refine decisions along the way.”

SUNFLARE SOLAR

Sunflare’s new solar technology, a super thin and lightweight solar “wallpaper” of sorts, is the lightest and most flexible solar panel of its kind. The solar cells are created with copper, indium, gallium and selenide. Unlike Tesla’s solar roof tiles, which began taking orders in the United States in May, Sunflare’s thin solar cells do not include glass, which means it can be attached to walls and roofs, the top of trailers and mobile homes, or anywhere a designer or builder can dream up by using some double-sided tape.

TRUEPOINT LASER SCANNING TruePoint uses 3-D laser scan technology to accurately capture millions of real-world data points for a building or space within seconds. Then, in-house engineers use the latest software to provide clients with practical and custom deliverables such as point cloud data, 3-D models and 2-D drawings. Ryan Hacker, president of TruePoint Laser Scanning, says, “As-built models can expedite design, reduce clashes and change orders, ultimately saving time and money.” 36 | July-August 2017


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INTERNATIONAL INTERIOR DESIGN ASSOCIATION

IIDA Southwest PRIDE Awards

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The people, projects enabling success through interior design excellence By DAVID MCGLOTHLIN

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he International Interior Design Association is a professional networking and educational association with more than 15,000 members worldwide in more than 58 countries that’s committed to enhancing the quality of life through excellence in interior design and advancing interior design through knowledge, value and community. In April, IIDA’s Southwest Chapter celebrated the individuals who have greatly contributed to the profession and the exemplarily design work of different architecture firms at the 21st Annual Professional Recognition for Interior Design Excellence (PRIDE) Awards. This year, six awards were given to individuals/companies and 12 awards were given to specific design projects including the “Best of Show” award, which is awarded to one project from the Design Excellence recipients. A

BEST OF SHOW WINNER:

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DESIGN EXCELLENCE AWARD

Project: Booking.com Phoenix, Firm: Gensler Team Members: Beth Harmon-Vaughan, PhD, FIIDA, LEED AP; Dawn Hart, NCARB, LEED AP BD+C; Melissa Holm, IIDA, WELL AP, LEED AP ID+C; James Bailey, IIDA

Project: Booking.com Phoenix, Firm: Gensler, Team Members: Beth Harmon-Vaughan, PhD, FIIDA, LEED AP; Dawn Hart, NCARB, LEED AP BD+C; Melissa Holm, IIDA, WELL AP, LEED AP ID+C; James Bailey, IIDA

It was important that Booking.com’s new office represent the many reasons why people love to visit Arizona, while also providing a great work environment for its employees and a welcoming meeting space for partners.

Looking to capture the essence of Arizona and the Sonoran Desert, the design team collaborated with the client to create a fun and uniquely “Phoenician” office.

COMMERCIAL OFFICE UNDER 10,000 SF B

DESIGN EXCELLENCE AWARD

Project: HealthiestYou Corporate Tenant Improvement, Firm: RSP Architects, Team Members: Joe Tyndall, principal; Dawn Brown, project manager; Alissa Franconi, associate IIDA, studio design lead; Erin Yi, project interior designer The 9,900-square-foot space for HealthiestYou, a startup telehealth company, promotes a healthy work environment flexible enough to meet the needs of the 50-person office. 38 | July-August 2017

COMMERCIAL OFFICE 10,000-25,000 SF C

DESIGN EXCELLENCE AWARD

Project: Atmosphere Commercial Interiors, Firm: RSP Architects, Team Members: Joe Tyndall, principal; Dawn Brown, project manager; Alissa Franconi, associate IIDA, studio design lead; Christine Shaw, project interior designer Located in the Roosevelt Row Arts District in Downtown Phoenix, the two adjacent brick buildings dating back to the 1920s were redeveloped into a cohesive office and showroom with an industrial feel.

B


C

39


IIDA D

AWARD OF MERIT

HOSPITALITY, RETAIL AND RESTAURANT

Project: Hubbard Radio Phoenix, Firm: RSP Architects, Team Members: Joe Tyndall, principal; Dawn Brown, project manager; Alissa Franconi, associate IIDA, studio design lead; Erin Yi, project interior designer; Jason Ploszaj, project designer; Shane Lucero, project architecture; Jordan Snittjer, designer

AWARD OF MERIT

E

Project: Babbo Italian Eatery, Firm: Form Design Studio, Team Members: Jose Martinez, IIDA, LEED AP, ASID, associate AIA; Haleigh Mitchell; Rick Riegle, architect

Project: Envy Residences, Firm: Private Label International, Team Members: Wendi Stallings, IIDA; Robbyn Gabby; Christina Johnson; Susan Patterson

Strong focal elements, including a central feature bar, visually textured finishes and jewel lighting accents enhance the restaurant’s volume and define the interior spatial layout.

Envy brings a new kind of high-end living experience to the Scottsdale condo market, a modern design inspired by iconic glamour.

The design goal was to create a progressive and cost efficient work environment that combines the workforce from three separate locations and five radio stations into one space with production studios, on-air studios and offices.

COMMERCIAL OFFICE OVER 25,000 SF D

DESIGN EXCELLENCE AWARD

Project: Mobile Mini Headquarters & National Sales Center, Firm: SmithGroupJJR, Team Members: Michelle Goodlive, LEED-AP; Brooke Waldron; Ramon Martinez From Tempe to Phoenix, Mobile Mini embraces its new location at 44th and Van Buren streets, occupying the third and fourth floors inside a four-story building.

AWARD OF MERIT Project: Valley of the Sun United Way, Firm: SmithGroupJJR, Team Members: Michelle Romero, NCIDQ; Mark Adams, NCIDQ; Chris Ledwith, AIA; Jon Silhol PE, LEED AP BD+C The “Live United” motto of Valley of the Sun United Way positively impacts thousands of Arizonans each day and its new office was a chance to continue to carry forth the same purpose. 40 | July-August 2017

E

CATEGORY: MIXED-USE DESIGN EXCELLENCE AWARD


IIDA F

CATEGORY: ON THE BOARDS

CATEGORY: STUDENT

PATRON OF THE YEAR AWARD:

[Note: these projects are still in the concept/design phase]

DESIGN EXCELLENCE AWARD

Thomas Printworks

F

DESIGN EXCELLENCE AWARD

Project: Engineering Building – UT Dallas Firm: SmithGroupJJR, Team Members: Mark Adams, RID, NCIDQ; Mark Kranz, FAIA, LEED AP BD+C This education and research facility for the next generation of engineers coalesces instructional and research labs, classrooms, office and collaborative spaces into a new hub.

AWARD OF MERIT Project: Confidential Client, Firm: SmithGroupJJR, Team Members: Casey Potash, IIDA, NCIDQ, LEED AP; Michelle Romero, NCIDQ; Mark Adams, NCIDQ; Mark Cone, AIA; Stephanie Oleksa; Danielle Hoyt, NCIDQ, LEED AP; Nhu Le; David Lyons, AIA The renovation of an existing warehouse space for an automobile manufacturer IT Innovation Center would include a new second floor, which would inlcude new employee entrances, an auditorium, command center, community commons and cafeteria.

Project: The Shops at Grand Avenue School: Arizona State University Student(s): Kiana Taie, student IIDA

CHAPTER GRADUATE AWARD:

Clean whites, warm woods and copper accents give a refined aesthetic complimenting the industrial look of the warehouse, which houses Teaspressa, Ruze Cake House and Camelback Flowershop.

INDUSTRY APPRECIATION AWARD: Dan Lynn, industry IIDA of Contract Furniture Associates

OUTSTANDING SERVICE AWARD: Peggy Favour, IIDA of SMPC Architects

GENERAL CONTRACTOR OF THE YEAR AWARD:

AWARD OF MERIT Project: The Stage, School: Arizona State University , Student(s): Glory Rittman, student IIDA and Kiana Taie, student IIDA The new office and studio space for local photographer, Caleb Alvarado, is housed in the oldest warehouse in Phoenix, the Feed & Seed Building. Space planning was based on theatre concepts.

Connie Hines PHOTO BY LELAND GEBHARDT

42 | July-August 2017

Jennifer Cox, student IIDA of Arizona State University

Hardison/Downey Construction

LIFETIME ACHIEVEMENT AWARD: Connie Hines, IIDA of The Studio


Building What Matters for Arizona

Aligned Data Center, Phoenix

FedEx Ground Packages System Inc., Phoenix

usa.skanska.com

THANK YOU TO OUR FANTASTIC CLIENTS & INDUSTRY PARTNERS FOR COLLABORATING WITH US ON AWARD-WINNING DESIGNS! www.gensler.com

43


MOST INFLUENTIAL

WOMEN IN COMMERCIAL

REAL ESTATE By MICHAEL GOSSIE

T

he 16 women who made AZRE’s list of the Most Influential Women in Commercial Real Estate for 2017 are an extraordinary bunch. While that seems implied in the recognition, it’s something that goes beyond their professional achievements. Many of these women had to overcome seemingly insurmountable obstacles to make their marks in a male-dominated industry. You’ll meet a yogi, a former

motocross racer, a skilled hunter, and one woman who has found her passion is being of service to other women who are struggling. While all of the Most Influential Women in Commercial Real Estate likely know what it’s like to be the only girl in a boys’ club, they also know the impact they are making as strong women who are changing their communities and their industry. And, all of them are changing the Arizona landscape one deal, one building, one drawing and one deadline at a time.


DONNA KENNEDY

Economic development director City of Tempe Kennedy’s career experience includes two professional fields — one in urban planning and the other discipline of economic development. She has managed many development and redevelopment projects, most notably the Verrado Master Planned Community in Buckeye and the Phoenix Biomedical Campus, which set the tone for downtown development.

JENIFER DAVIS LUNT President and principal Davis Enterprises

Davis is a local leader in adaptive reuse projects. She most recently completed The Wedge across from ASU, as well as Melrose Marketplace on Seventh Avenue and Indian School Road.

Best decision: “Spending the first 10 years of my

career working in a large institutional commercial brokerage company, because it exposed me to a multitude of the different facets and nuances of real estate ownership and development. I have found that you can learn a lot from both the successes and failures of others.”

Surprising fact: “I have been involved in the practice of yoga for the past 20 years and meditate on a regular basis to help balance my work and family life.”

Best decision: “I have worked in Buckeye and Phoenix, (but) accepting a position in Tempe has taken my career to a new level. Working in a progressive urban city has allowed me to establish programs complimenting the history of Tempe for a sustainable economy.  I was in the right place at the right time.” Surprising fact: “I was a runner and trained for the Rock ‘n’ Roll Marathon. Weeks before the race, I injured my knee and could not participate. Disappointed, but I gained friendships with my peers who trained and completed the race.”

JULIE JOHNSON Principal Avison Young

Johnson has been a leader in healthcare real estate for over 25 years in the Phoenix Metropolitan area. In 1992, she achieved the prestigious CCIM (Certified Commercial Investment Member) designation – often referred to as the Ph.D. of commercial real estate.

Best decision: “Early in my career,

I was referred many clients who were in the healthcare industry because I had worked in a healthcare

related industry. There were only a couple of brokers specializing in healthcare and there was a skill set associated with doing these deals successfully and decided to specialize only in healthcare. Now, years later, there are many brokers specializing in healthcare, but to have made that decision early in my career was very beneficial.”

Surprising fact: “I’m an

adrenaline junkie. I’ve driven race cars, climbed Mt. Kilimanjaro, parachuted, bungee jumped and still get the adrenaline rush from doing deals.” 45


MOST INFLUENTIAL WOMEN MINDY KORTH

Executive vice president Colliers International Korth is accomplished in all sectors of investment real estate, including office, medical office, retail, industrial, commercial land and unique projects across metropolitan Phoenix. A 30-year veteran, she has completed transactions totaling more than 25 million square feet and more than $2.7 billion in value.

Best decision: “I took Jim

LISA JOHNSON

President and CEO Corporate Interior Systems Johnson started Corporate Interior Systems, a commercial furniture dealership with offices in Phoenix and Tucson, in 1985. She has been the president and CEO for 32 years.

Best decision: “Taking the risk

Mahoney’s advice to become an investment property sales broker. It has enabled me to use all of my skills and work with fascinating people on outstanding projects.”

ERICKA LEMASTER

Senior vice president commercial real estate Alliance Bank of Arizona

LeMaster actively manages a loan portfolio of more than $700 million, all of which is organically originated.

Best decision: “Anyone who knows me, knows

the obvious answer is aligning myself with Alliance Bank of Arizona. Alliance Bank is not only an expert in commercial real estate financing, but the bank is 100 percent committed to developing talent and career advancement of their professionals.”          

to start CIS at the age of 25 and aligning myself with Knoll, one of the leading furniture manufacturers, as a strategic partner. My vision for the future of CIS matched the values of Knoll and we have been among their Top 15 dealerships in the country for 26 years.”

Surprising fact: “I like having fun with fashion,

so from the outside, most people would think I’m a girlie-girl. However, I grew up in a very rural area of the White Mountains on lots of acreage with a small farm. I spent the first 10 years of my life climbing trees and chasing chickens, geese, ducks and goats. I am a closet country girl and love the simple things in life.”

Surprising fact: “My plan after

finishing business school at ASU was to go on to law school. Instead, I decided that I wanted more control of my destiny and chose to take the entrepreneurial route instead.”

DONNA LEMONS-ROUSH Chief operating officer MT Builder Companies

Lemons-Roush has been involved in the multi-housing construction industry for 32 years and a corporate officer with MT Builders for the past 22 years. She has managed the construction of several landmark projects, including Desert Park Luxury Apartments, Escape Luxury Apartments and Sierra Pointe Retirement Apartments. Currently, she is managing a 46 | July-August 2017

Surprising fact: “I have a full-size stone sheep trophy in my home. I shot it in the Yukon Territory near the Arctic Circle.”

nonprofit project called Treasure House for Kurt and Brenda Warner.

Best decision: “Having the courage to

work in a ‘man’s’ world of construction. There have been many challenges to overcome in the past 32 years, but the end results are more than I could have ever dreamed.”

Surprising fact: “I love to fly fish. This is a hobby my husband got me into more than 15 years ago. Top of my bucket list — fly fish the USA.”


MOST INFLUENTIAL WOMEN TINA LITTERAL

Executive vice president AIA Arizona Best decision: “The smartest

professional decision was reaching out to colleagues within the construction industry and also the American Institute of Architects. These colleagues – Janice Burnette, Mark Minter and Michael Green – took a young lady under their wing and showed her the ropes when it came to the legislative process. This is one of the most important areas for AIA Arizona and our partnership with these colleagues have assisted the architects throughout Arizona.”

ALISA LYONS

Principal Sloan Lyons Public Affairs Lyons focuses on government relations and strengthening economic development public/private partnerships. Lyons acts as the municipal lobbyist for Valley Partnership and as contract CEO for the Discovery Triangle Development Corporation, as well as serving other clients.

Arizona on August 1, 1986 as the receptionist. In the fall of 1995, Martha Miller, the executive director, announced her retirement and I started discussing the opportunity with the current board members. After a national search, an executive director was hired and after 90 days was fired. I was named the interim executive director for approximately 90 days, after which I was named executive director. Last August, I celebrated my 30th anniversary with AIA Arizona.”

Best decision: “Launching Sloan

Lyons Public Affairs. With the support and assistance of incredible leaders like the recently passed Don Keuth, I identified strategic ways our firm could meet a need in the industry — combining targeted government relations with the promotion of responsible, community-focused, economic development.”

Surprising fact: “I learned to scuba dive in the Red Sea and travelled along the Nile on a felucca named the Jemmy Hendrax.”

JODI MALENFANT President and owner W&W Structural Inc.

Malenfant has been president and owner of W&W Structural Inc., a structural steel subcontractor, for more than 30 years. Her primary duties include running the day-today operations of W&W, marketing, business development, accounting and human resources.

Best decision: “My best decision was to start a successful company

48 | July-August 2017

Surprising fact: “I started at AIA

in Arizona and always cater to clients with whom we’ve had great relationships. By doing this and remaining local, we became a company clients knew they could rely on to be here for their next project.”

Surprising fact: “When I was in high school, I was a motocross racer. At the time, most of the other racers didn’t realize I was a girl until I took off my helmet. I was pretty good, too. I am also the mother of five children, all of whom make me extremely proud.”


MOST INFLUENTIAL WOMEN LAURA ORTIZ

President Evergreen Development Ortiz oversees Evergreen and its many commercial developments. She is also very involved with new client development and lease negotiations. Ortiz holds a bachelor’s degree in finance and economics from the University of Arizona.

Best decision: “About 10

MARY NOLLENBERGER

Director of leasing and retail investment sales SVN Desert Commercial Advisors Nollenberger began her career in the commercial real estate industry over 15 years ago, and joined SVN in 2007.

Best decision: “The decision that I

feel has most profoundly influenced my career is the fierce commitment to stay — to make an intentional decision during the recession to stay the course, to commit 100 percent to the fact that there is no ‘back-up plan,’ to earn business through relationships that matter and to never waiver in commitment.”

Surprising fact: “We have a blended family that is full of love and is massive in proportion. We are 25 strong with 10 children and seven spouses and future spouses, six grandchildren, five family dogs and two of us. When we all gather in one place, it is an event that takes a block of rooms or a lot of aero beds. We share lots of laughs, little sleep and tons of cherished memories.” 50 | July-August 2017

years ago I decided I wanted to focus more of my time and energy on our growing multi-tenant shopping center business. This vastly broadened and sharpened my skills in real estate development and also helped me establish new relationships in the industry, both of which have been critical to my career and to Evergreen’s success.”

KATHI O’CONNOR

Lead personnel Swaine Asphalt Corporation 

Surprising fact: “I am an Arizona native -

born and raised in Cottonwood. After being together for 10 years, I married my high school sweetheart, Paul, and we’ve now been married for 19 years.”

O’Connor defies the odds and has been working in the male-dominant construction industry for more than 15 years. She transports asphalt materials and construction equipment to and from projects and has served in a leadership role as a field supervisor and asphalt foreman.

Best decision: “As one job career

was coming to a close for me, Tom Swaine, the founder of Swaine Asphalt Corporation, called me one day and said, ‘Come work for me.’ Tom motivated me to get my Commercial Driver’s License, taught me how to haul equipment and do the ‘unthinkable’ for most women. Looking back, I took a huge risk and most companies do not hire women to do a man’s job. Today, I can say I am more self-confident and not afraid to take risks and make mistakes because I had that endless support from Swaine Asphalt that I wouldn’t have received anywhere else.”


CONGRATULATIONS TO ONE OF

THE MOST

INFLUENTIAL

WOMEN IN COMMERCIAL

REAL ESTATE,

SHAWN

RUSH Shawn is an Interior Design Principal and the Office Director for Corgan’s Phoenix office. She draws out the best in our clients, understands their brand, and develops the best solution for each project.

ARCHITECTURE INTERIOR DESIGN PHOENIX · LOS ANGELES · NEW YORK · DALLAS · HOUSTON · SAN FRANCISCO · BEIJING · HONG KONG · SINGAPORE


MOST INFLUENTIAL WOMEN SHAWN RUSH

Principal and office director Corgan Rush is a principal and office director of Corgan’s Phoenix office with more than 30 years of architectural design experience. She averages more than 200 volunteer hours annually for CREW.

Best decision: “Moving home

to Arizona certainly tops the list of smartest decisions. My family is here as are so many of the leaders who helped shape who

I am today. Continuing to build on Corgan’s success in the Valley and developing the next level of leadership in the firm’s Phoenix office has been a wonderful adventure.”

Surprising fact: “One of my

first significant clients was Jeff Bezos, CEO of Amazon, and I was his introduction to architecture. The relationship began with a handshake and resulted in millions of square feet of project work, including the first Amazon call center, and eventually its first headquarters.”

ASHLEY SNYDER

Senior vice president Cresa Snyder’s 11 years of experience in the commercial real estate industry includes project management, transaction management, portfolio management and client relationship development. Her technical knowledge of the real estate process allows her to identify and implement the internal resources of Cresa’s multidisciplinary services.

TIFFANY WINNE

Senior vice president and branch manager Savills Studley Winne is devoted to representing tenants and helping them turn real estate into a strategic advantage.

Best decision: “Opening the Savills

Studley Phoenix office. This has been one of our fastest-growing new offices ever and we’ve been able to serve a growing portfolio of clients, in addition to recruiting a talented team and elevating awareness of our firm’s brand and service platform here.”

52 | July-August 2017

Surprising fact: “Many people assume that brokerage is a very local business, so they’d be surprised to know the volume of transactions that we manage all over the world. At any given time, I have real estate deals going on in multiple cities and countries. My background is international: I’ve lived and worked in Italy, Hungary, Japan, Australia and Germany, so it’s a good opportunity to use those skills. Our business is increasingly global, which is a big departure from what many people think of as traditional local brokerage.”

Best decision: “I’m not afraid to ask for help. I found my niche by focusing on the areas of the business that I can add the most value. This means that I must surround myself with experts in other verticals and recognize when I need to lean on them for support or guidance.”

Surprising fact: “Over the past few

years, I’ve found that my true passion is being of service to women who may be experiencing difficulty in their personal or professional life, and helping them realign with their life’s journey by sharing my experience, strength and hope.”


COMING NEXT ISSUE Featured topics include:

• Arizona Multihousing Association • NAIOP • BOMA/Building Owners & Managers Association

For additional information, call 602.277.6045 or visit,

azBIGmedia.com

MOST INFLUENTIAL

WOMEN IN ARIZONA

Congratulations Donna on your accomplishments with MT Builders!

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53


MOST INFLUENTIAL WOMEN

MOST INFLUENTIAL WOMEN IN 2017: (Front, from left) Donna Lemons-Roush, chief operating officer, MT Builders; Donna Kennedy, economic development director, City of Tempe; Jennifer Davis Lunt, president and principal, Davis Enterprises; Julie Johnson, principal, Avison Young; Mary Nollenberger, director of leasing and retail investment sales, SVN Desert Commercial Advisors; and Ashley Snyder, senior vice president, Cresa. (Back, from left) Mindy Korth, executive vice president, Colliers International; Shawn Rush, principal and office director, Corgan; Lisa Johnson, president and CEO, Corporate Interior Systems; Tiffany Winne, executive vice president and branch manager, Savills Studley; Laura Ortiz, managing principal and president, Evergreen Development; Alisa Lyons, principal, Sloan Lyons Public Affairs; and Tina Litteral, executive vice president, AIA Arizona. PHOTO BY MIKE MERTES, AZ BIG MEDIA SPECIAL RECOGNITION: Thank you to the Marina Heights Campus's developer Ryan Companies and property management company Transwestern for facilitating access to the Marina Heights Building 400 lobby.

54 | July-August 2017


AZCREW committee and become an active member. Since that day, I’ve been able to collaborate with incredible members to create programming that is influencing our community in so many ways. From charitable events, to inspiring panels and speakers, to reaching out to invite aspiring men and women into our organization, I’ve always felt that I can directly impact our programming with my time and ideas.

Jackie Orcutt

Q: Have you received any advice from past presidents? A: Everyone has made their own mark on my experience, no doubt. It was the brain child of Karen Halpert to launch the concept that evolved into the Black & White Affair, and it’s one of my favorite annual events. Last year, Christie Veldhuizen did a great job of reminding everyone that we can accomplish great things while still being efficient. She kept us all on track and on task and I’ve tried to carry that theme in our meetings this year.

Q&A with AZCREW's president By DAVID MCGLOTHLIN

AZCREW

was one of the founding chapters of the Commercial Real Estate Women Network when it was formed in 1985. Since then, it has grown to include more than 90 members in Arizona and 9,000 members in North America. As the 2017 president of AZCREW, Jackie Orcutt is tasked with leading the Arizona chapter in its continued mission to champion the success of women in the commercial real estate industry through resources, leadership, education and networking. Orcutt started her commercial real estate career at CBRE in 2007, later joining Cushman & Wakefield in 2011, only to again return to CBRE in 2016, which is where she works now as the first vice president of industrial brokerage. Over the years, Orcutt was named to AZRE’s 40 Under 40 list (2013), Most Influential Women list (2014) and most recently to this year’s list of Influential Millennials. Q: What are your top priorities as president? A: I have been excited to encourage and support activities planned by our board 56 | July-August 2017

such as the Women in Action Event that we held in April, the ongoing book clubs, luncheons, and encouragement for all members and our entire board to attend this years’ Convention in Houston from Oct. 25-27. Q: What’s the value of AZCREW membership? A: Undoubtedly, the ability to surround oneself with other women, and men in support of women, who are paving the way in their careers and in life. We all have a common thread in that we work incredibly hard, and we promote excellence as career women, but also as individuals. Q: What’s the biggest benefit that you’ve experienced through your involvement with AZCREW? A: Immediately, from day one as a member, I was invited to join a

Q: How do you balance your career with being a mother of three? A: The energy and ambition that comes from the bellies of those three little munchkins is enough inspiration to light the world on fire. I was raised by a mother who let her work shine through at home, and who let her home life inspire her work, so I can truly say I have never thought life could be any other way. I am incredibly fortunate to have an amazing husband and local family members who all help raise our babies. At work, I have an awesome team committed to doing their part to accomplish our collective goals. Message to members: Get out there and mix it up. Join a committee, make the “ask” for that massive assignment you’ve been wanting, pull the trigger on that great trip you’ve been looking forward to, and call your mother/best friend/mentor to say “thank you” for their support. Surprising fact about yourself: I love the occasional karaoke night and I won the Nebraska State Fair Hula Hoop contest when I was 13.


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AZCREW

58 | July-August 2017


Breaking through AZCREW members offer advice for women striving to advance their careers in the industry By DAVID MCGLOTHLIN

T

he Arizona commercial real estate industry’s longstanding identity as a “boy's club” is slowly becoming a misnomer. Each year more women break through within the industry as they take on greater leadership roles at various executive positions based on their respective disciplines and specialties. These AZCREW members represent a diverse mix of disciplines from architecture to construction and property management to brokerage. They were asked to share their experiences and advice for other women in the industry trying to break through a glass ceiling in their careers.

59


AZCREW

Michelle Brown

General property manager and designated broker at Hines

Lindsey Carlson

Vice president at Colliers International Greater Phoenix

AZRE: AS AN INDUSTRY, WHAT KIND OF IMPROVEMENTS HAVE YOU NOTICED IN THE WORKPLACE? CARLSON & DARBY: With the

increasing number of women in commercial real estate, men more frequently find themselves across the table from women. The old “boy's club” atmosphere may still persist, but women are being recognized for the value that they bring to the table as professionals. Many companies are now actively educating their organizations about equality and fairness in the workplace and emphasizing this as part of the culture.

PINKAL: I see more diversity in my

own company at all levels and that’s really encouraging. I’ve also noticed individual employees taking ownership of their own role in workplace equality, whether that’s to build up and promote others or to step up into a role that needs to be filled regardless of their age, gender or background.

BROWN: Hines formed the One

Hines Women’s Network and I’ve been selected as our local ambassador to organize events that will expose our Phoenix team to people, opportunities and experiences that would promote career development, build confidence and encourage discussions about

60 | July-August 2017

Ruth Darby

Samanatha Pinkal

Vice president at Colliers International Greater Phoenix

Shawn Rush

LEED AP — Business development manager at The Weitz Company

gender equality in the workforce. Additionally, Hines expanded their Paid Parental Leave program to give parents (men and women) additional time off with a new child.

LEED AP — Principal and office director at Corgan

Respite rooms, at every level for both genders. Additionally, there has been inspiring, powerful growth of women’s professional organizations that promote education, support and perpetuation of corporate real estate. These are invaluable outlets for young women who otherwise may not be aware of the industry, as well as seasoned professionals seeking advice and community to deal with similar issues.

RUSH: Within the workplace and

finding better work/life balance, I see employers, for the first time, truly prioritizing opportunities and R Eaccommodations, S E A R C H M E T like H O DWellness O L O G Yand

Women in the Industry Respondents were asked to estimate the percentage of women commercial real estate professionals at their current work location. The same question was asked about professionals within their specialization.

Estimated Percentage of Women in Respondent Work Locations: Specialization by Year Estimated by Survey Respondents

ASSET MANAGERS

60%

2000

2004

2005

2009

2010

2014

2015

47

51

51

53

56

47

54

BROKERAGE

50%

40%

2000

2004

2005

2009

2010

2014

2015

36

34

39

39

36

23

29

D E V E LO P M E N T

30%

2000

2004

2005

2009

2010

2014

2015

20

21

23

27

30

35

38

FINANCE

20% Asset Managers 2000

2004

Brokerage 2005

Development 2009

2010

Finance 2014

Total 2015

2000

2004

2005

2009

2010

2014

2015

37

42

44

44

43

39

42

TOTAL 2000

2004

2005

2009

2010

2014

2015

32

35

36

42

43

42

43

Estimated PercentageSOURCE: of Women Industry-Wide: Canada and the U.S.REPORT 2015 CREW NETWORK, BENCHMARK STUDY ASSET MANAGERS U.S.

44%

Canada

38%

Estimated by 2015 Survey Respondents


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AZCREW AZRE: HOW HAVE YOU OVERCOME SITUATIONS OF WORKPLACE INEQUALITY IN THE PAST? RUSH: Growing women into leadership roles is challenging within an industry traditionally male dominated. However, being a woman in any business is only tough if you don’t believe in your own ability.

PINKAL: I’ve taken action instead

of waiting for someone else to do something. I’ve gone to my mentors and champions to talk through situations, ask for advice and to rally support. Those can be hard but they’re important, not only to promote equality but also to build a report with leadership and position yourself as a leader within your sphere of influence.

CARLSON & DARBY: We have used

a three-prong approach. The first is being self-confident and assertive by expressing our needs and preferences while still respecting others. The second is standing up for ourselves by confronting the offender and articulating our concerns. If the situation persists or deteriorates, the third prong is to speak with management. Ultimately, we gain respect and fair treatment by our peers by conducting ourselves with integrity and honestly, building our reputation and relationships along the way.

BROWN: While I’ve faced challenges at work, I haven’t experienced workplace inequality. AZRE: WHAT’S YOUR ADVICE FOR WOMEN IN COMMERCIAL REAL ESTATE? CARLSON & DARBY: Take

responsibility for where you are today and where you are headed. Surround yourself with cheerleaders along the way but keep in mind that you control your own destiny. Find a mentor who has been through the trenches and on whom you can depend for advice and guidance. Don’t limit yourself to a

62 | July-August 2017

SOURCE: CREW NETWORK, BENCHMARK STUDY REPORT 2015

female mentor; it’s about the quality of the person you choose. Also, become a mentor to someone new to our field. Ultimately, believe in yourself as an individual, not as a gender.

PINKAL: First, find your mentors and

champions. They should be both men and women, above and below you. Surround yourself with people who want to help you succeed. Second, don’t qualify yourself as a “woman” in CRE. Just be a professional in CRE. The idea of equality is that it would not matter if you’re a man or woman. And third, broaden your skillset, learn how to do more than just your job. You’ll be amazed at how much more value you

can add when you’re working toward a bigger picture.

BROWN: Work hard, ask lots of questions, and don’t be afraid to get involved even if you don’t feel quite ready. I’ve grown the most while working on projects that were outside my comfort zone. I would also say, speak up and toot your own horn. Women need to do a better job of promoting themselves and their accomplishments. RUSH: Purposefully build relationships with people wanting to see you win and build self-belief to break through your glass ceiling.


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ARIZONA BUILDERS ALLIANCE

40 years later President Mark Minter reflects on his time with ABA

N

ow in his 40th year of service, Mark Minter, president of the Arizona Builders Alliance, is preparing to start the next chapter in his career – retirement. In the meantime, ABA, a trade association of commercial and industrial builders including general contractors, subcontractors, suppliers and service companies, is beginning the search and interview processes for a new president to replace him before his tenure ends in April 2019. Prior to the 1994 merger of the Associated Builders and Contractors (ABC) and the Associated General Contractors (AGC), Minter was with the AGC since 1977, serving in multiple positions such as Tucson branch manager, assistant director and executive director. Before he passes the torch, Minter shared some thoughts about his time with ABA and what it means as a resource for unifying the many of the different builders and companies in the construction industry.

HOW DO YOU DESCRIBE YOUR CAREER WITH THE ABA? I have been fortunate to represent a growth industry in a growth state. My tenure coincided with a huge boom in population, employment and opportunities. I am blessed to represent a great group of people who do work that is so important to society.

WHAT MEMORIES STILL RESONATE WITH YOU THE MOST? Early in my career, I spent more time on jobsites. The superintendents that I met in those years were fantastic people to be around. A superintendent is a person who can look at a set of 68 | July-August 2017

plans and a vacant lot and envision a completed building. They are the people who make it happen.

WHAT’S ONE EXAMPLE OF ABA’S IMPACT ON THE INDUSTRY? In the 1980s, we made a significant shift to providing management education. That effort has not only helped make our members more profitable, it has helped many people have successful careers in construction.

DURING YOUR 40-YEAR TENURE WITH ABA, HOW HAS THE INDUSTRY CHANGED? Technology was just starting to impact construction. Bids were put together using 10-key adding machines and scheduling was done on butcher paper with grease pencils. In the 1970s, computer-based scheduling was starting to sweep the industry. When the first computers were being adopted by big contractors those were massive mainframes being accessed by a handful of people. Today, everybody has more computing power on the tablet that they carry to meetings.

WHAT’S THE BIGGEST IMPACT OF THESE INNOVATIONS? The widespread use of technology allows even small projects to be done “better, faster, smarter.” Small contractors and their clients are utilizing technology that big projects did not have 50 years ago.

LOOKING AHEAD, WHAT ARE ABA’S MOST IMPORTANT PRIORITIES/GOALS? Getting the next generation of leaders prepared to take the helm. With the right leaders in place, we can

handle the legal, economic and social challenges that will surely arise.

WHAT VALUE DOES ABA BRING TO THE INDUSTRY? Construction trade associations have always been valuable because even big contractors tend to be small businesses. Unlike other industries, we don’t have firms with 30 and 40 percent market share. Fewer resources in the hands of smaller firms means we need to come together to get anything done. It is truly a more democratic industry in that way.

WHAT WILL BE NEXT FOR YOU AFTER ABA? I’m hoping for continued good health, a few adventures, some travel and more time for family. There are lots of places in this beautiful world I haven’t seen yet; so, maybe I can fix that. Message to members: Thank you for the opportunity to be part of your great industry. I stumbled into this industry, but have never regretted it for one second. Business advice: We are in an industry with a lot of conflict. Long term success is easier when understanding the other person’s priorities and point of view.


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ABA

Building the future ABA’s workforce development programs pave the way for the next generation By DAVID MCGLOTHLIN

T

he biggest challenge affecting the construction industry isn’t a lack of projects to build, but rather a shortage in the amount of available skilled laborers to build new projects. Industry experts agree the best solution is to implement effective workforce development strategies to replenish the talent pool of skilled laborers. Thus, the Arizona Builders Alliance (ABA) and Associated General Contractors of America (AGC) partnered in a commitment to spread awareness and expose the younger generations to viable career opportunities in the construction industry by facilitating the training and on-the-job experience to be successful. ABA is an alliance of the Arizona Chapters of the Associated Builders & Contractors (ABC) and the AGC that represents more than 300 member companies, which includes contractors and professional service firms. A shared concern among many of those member companies centers around the limited supply and increasing demand for qualified skilled workers. To address that, ABA has deployed different workforce development programs over the years that give anyone the opportunity to learn a trade and find

70 | July-August 2017

work in the industry based solely on their individual merit. ABA says, its registered apprenticeship system of training is unique because it’s the only formal, structured and nationally recognized education and training program that combines the two most common forms of career and occupational learning: classroom instruction and onthe-job training. In Southern Arizona, its JTED Explorers program is a partnership with local high schools along with career and technical education (CTE) instructors that consists of taking interested high school students on tours of active jobsites like the BannerUniversity Medical Center Tucson project. While these programs focus on replenishing the pipeline of builders and laborers, ABA also leads the industry in Arizona in Management Education for contractors, offering programs like the Project Manager Development Program (PMDP), Leadership Development Forum (LDF) and Senior Executive Program (SEP). Each program provides education at the management level along with the ability to meet peers in the same level in order to share Best Practices and not only learn from instructors, but from one another. None of these programs would be


71


ABA ABA reports, “Journeymen who complete apprenticeship will be earning more money than 98-percent of all the graduates with four-year college degrees.” possible if not for the ABA’s proactive efforts to improve the construction industry through the continued support of its members, sponsorships, donations of time and money.

THE OTHER 4-YEAR DEGREE While the idea that a college degree is the only way to secure a successful career still remains prevalent, construction apprenticeship programs are gaining more traction as alternative paths to viable careers. Fred Ingersoll, vice president of development and training for ABA, refers to this as “the other four-year degree.” He is tasked with coordinating, managing and achieving desired results as it relates to the ABA/ AGC’s Education Fund Apprentice Training Programs. One example is a Registered Apprenticeship, which he describes as an employer-driven model that combines on-the-job learning with related classroom instruction that increases an apprentice’s skill level and wages. Unlike attending college where students pay tuition to learn, apprentices earn a salary while learning. Not only can this lead to gainful employment but apprentices also graduate without mounds of potential student loan debt. The apprentice program’s curriculum and style of instruction focuses on

ABA Apprenticeship Programs at EVIT include: • electrical apprenticeship • heavy equipment operator • diesel mechanic • welding • surveyor assistant

72 | July-August 2017

the necessary knowledge, skills and traits that are required by a journeylevel worker in the trade. Under the supervision of a journey-level trade professional, workers learn the practical and theoretical aspects of a highly skilled occupation, explains Ingersoll. The ABA’s main Apprenticeship program at the East Valley Institute of Technology (EVIT) is electrical, but Ingersoll says, the ABA will also be starting a carpenters’ apprenticeship in August. Graduates who successfully complete their apprenticeship training will receive nationally recognized Journeyman Certifications from the U.S.D.O.L. that allow them to seek job opportunities in their respective trades at projects across the country. Ingeroll says, “Thanks to the partnership of ABA and EVIT along with the support and donations of many vendors and companies, apprentices have instructor designed labs and workstations that are second to none.”

Electrical Apprenticeship: Under the supervision of a qualified Journeyman Electrician, students learn and practice variety of wiring methods for light, heat, power and radio.

“The attendance and enrollment for new apprentices has more than tripled in the first and second semesters and overall head count continues to increase,” adds Ingersoll. He predicts enrollment for the fall 2017 programs will substantially increase in size again.

SOUTHERN ARIZONA’S JTED EXPLORERS In the 1950s, Boy Scouts of America started developing a program, known today as “Explorer Posts,” that provides children between 14-20 years old with educational hands-on and interactive activities facilitated by trained business leaders in the community. By 1981, the growing popularity of the Exploring programs led to the creation of specialty programs across


ABA MANAGEMENT EDUCATION TRAINING PROGRAMS Project Manager Development Program: A five-month, 80-hour program specifically designed for early career (two-years or less) project managers, project engineers, assistant project managers and superintendents from statewide general contracting and subcontracting firms. It focuses on five modules including estimating and job costing, project administration, contract administration, risk management and leadership before it concludes with a graduation ceremony in June. Leadership Development Forum: A year-long program designed for seasoned project managers, superintendents, owners, estimators and other people advancing in their careers from up to 36 total member companies. The class focuses on leadership, team building, construction finance, public speaking and takes on an annual community service project of nearly $100,000. Lastly, the class culminates in a case study competition where teams spend six-months working on a case study to present to a team of judges. Senior Executive Program: A four-month program designed for owners and senior level executives to promote ongoing management and leadership training. The class consists of only 16 executives and focuses on the unique challenges at the executive table, decision making for leaders, conflict management and much more. The courses are taught by Del Webb School of Construction Professors, as well as other industry executives.

the nation such as aviation, business, law enforcement, social services, law, government and many others. As a former Eagle Scout, Tom Kittle, ABA member and owner of Kittle Design & Construction, was aware of the Explorer programs and saw an opportunity to create a program in 2014 that enabled local students to learn about diverse careers in the construction industry. “Other national Explorer programs 74 | July-August 2017

tour construction sites,” explains current ABA Vice President of Southern Arizona Tom Dunn. “However, we were the first Explorer Post in the United States to focus strictly on commercial construction,” which was recognized later that year by the ABC as a “Best Practice for Career Outreach.” Better known today as the ABA JTED Explorers program, the collaboration of ABA and Pima JTEDs still provides CTE students with a chance to explore possible future careers in the construction industry. “From the beginning of the program, we’ve focused on creating an action plan that attempts to get as many future employees in front of as many future employers that we can,” explains Dunn. Through the program, students tour manufacturing sites, commercial construction jobsites, projects and other facilities that may present students opportunities for employment, internships, apprenticeships and scholarships. Dunn describes the program’s first Tom Dunn

JTED Explorers: For the Banner-University Medical Center Tucson tour, students rode the temporary evelator to the top of the building to speak with workers and project managers.

few years as very successful with 35-50 students attending the weekly 8 a.m. Saturday morning tours, but transportation became an issue and many that wanted to attend could not. Last summer, the tours were changed to weekdays and the JTED CTE instructors assumed the transportation responsibility. As a result, Dunn says, the program has expanded and now averages about 85 students per tour from seven participating high schools.

Fred Ingersoll

Erica Lange


75


ABA

BUILDERS ROUNDTABLE OF THE

76 | July-August 2017


The challenges, trends and innovations shaping the construction industry’s outlook By DAVID MCGLOTHLIN

W

ith more than 100 years of combined construction experience, these Arizona Builders Alliance members weigh in on the current state of the construction industry, how it’s evolving and what to expect coming down the pike. Each of them are decision makers and thought leaders for their respective companies tasked with ensuring its prosperity and viability, which makes them uniquely qualified to share their analysis, outlook and insights.

Q: WHAT’S THE BIGGEST ISSUE FACING THE CONSTRUCTION INDUSTRY IN ARIZONA? STEVE WHITWORTH: The availability of skilled labor is probably our biggest ongoing challenge. DEREK KIRKLAND: Everyone from

trade and industry organizations, to general contractors and subcontractors, are tackling the question of how to rebuild a dwindling talent pool. At DPR, we are working to rekindle interest in construction by educating teens in our local community. We currently partner with the Phoenix nonprofit, New Pathways for Youth, to provide training, internships and scholarships to high school teens who follow a construction career path.

RANDY ESKELSON: The two main

issues we are facing are the shortage of skilled labor and the aging workforce. We need to recruit the next generation of construction workers and allow them to learn from our current tradesmen.

JUSTIN KELTON: Hiring, training and retaining a skilled workforce as more and more projects come on-line will

present more significant challenges, and could hinder the recovery of the industry. McCarthy has been investing in our apprentice program and career training programs with WestMEC and other JTED schools. We’ve launched efforts directed at training people in industries that are less active now‚ such as mining or manufacturing, and we’re having success with training people to work in emerging industries like solar.

DEREK WRIGHT: Labor has been and

will continue to be the biggest issue facing the subcontractor market in Arizona. Labor, while available, will be unskilled. Training and educational programs will be the necessity for companies wanting to increase their labor. Market wide, there will be upward pressure on wages that has been long overdue.

Q: WHERE ARE YOU SEEING INNOVATIONS AND HOW ARE THEY DISRUPTING THE CONSTRUCTION INDUSTRY? JK: Technology in construction is

bringing advancements and innovations that are causing disruptions for contractors, particularly those who have not invested in technology. While we began using a form of Virtual Reality (VR) several years ago, today our technology has advanced to a form that makes it available for any client to virtually create their vision and experience the space in full-color using VR goggles. One specific example of this is Mirabella Senior Living, where we developed a full-color, full-screen, 360-degree experience for their potential residents of what it will be like to live there. 77


ABA

Randy Eskelson

President and COO of Schuff Steel Management Company

Justin Kelton

President of McCarthy Building Companies Southwest Division

SW: Virtual reality is and will be used

more commonly; the ability to have clients interact with their projects before sticks and bricks are in the field. This technology is disrupting the industry because it’s impacting the way we design and redesign.

RE: Building information modeling

(BIM) technology has been around for many years now, and many of the large companies have been using this for years. Now we are seeing this more prevalent in the medium sized and even small general contractors.

Q: LOOKING AHEAD, WHAT WILL BE THE CONSTRUCTION TREND EVERYONE IS TALKING ABOUT? DK: The desire for greater predictability

in terms of cost, quality and schedule has been driving automation and prefab for a number of years. The issue there is supply chain volatility. There are comparisons to the similar path and story of the evolution of the auto industry from the 1990s, which resulted in a similar shift to prefab and robotics. At DPR, we have a fully automated pre-fabrication facility in Phoenix. On our recent SkySong 4 project, we saw increases in efficiencies of over 40 percent versus the previous SkySong 3 project.

RE: With the labor shortage that

we are facing, many companies are trying to move towards prefabrication. Prefabrication allows you to work in a controlled environment and in an assembly line, which leads to greater worker productivity.

78 | July-August 2017

Derek Kirkland Arizona business unit leader at DPR Construction

Steve Whitworth President of Kitchell Contractors

JK: The building information

modeling (BIM) trend is being taken to new levels with advancements in virtual reality technology, underground utility mapping as well as augmented reality, which maps vertical utilities in buildings. The combination of these technologies is already taking us towards more collaborative building methods such as CMR, integrated project delivery and design build, and eliminating job-site conflicts and scheduling delays because everyone is seeing and experiencing the building before a shovel goes into the ground, and works together to make necessary modifications or choices.

DW: Technology, in all of its forms, will continue to transform our industry. Think back even five years ago – little or nothing is done the same. Companies that can harness their creative and intellectual ingenuity with their employees will find themselves leading the market. The engagement of a different type of construction workforce that can utilize this technology will be the trend we all talk about. SW: Internationally, we are seeing that

you can 3-D print a home in concrete. This could move into beams, trusses, walls and other building components. With our off-site prefabrication facility, we are already seeing the value and benefits of modular assembly, and as technology improves, we will see greater complexity.

Q: HOW DO YOU DESCRIBE THE EVOLUTION OF THE

Derek Wright President of Suntec Concrete

CONSTRUCTION INDUSTRY IN ARIZONA? SW: As a homegrown Arizona

company with nearly 70 years under our belt, we have seen our share of change. Technology has impacted nearly every aspect of our industry. The way we build has evolved and our people think differently.

DW: Evolution of the construction industry is driven by expectations, whether internally or externally. External requirements that force changes in our businesses often make us better (i.e. the downturn in our economy forced us to find new efficiencies). The evolution of continued success derives from a model that seeks and finds those efficiencies from internal expectations. DK: I moved to Arizona 11 years ago and was surprised and impressed by the progressive and collaborative alternate project delivery method and qualifications-based selection process here in Phoenix. We have a tremendous opportunity in front of us to refocus and create a new joint vision as we move forward. I have started some of that initial discussion with our higher education customers and am hoping to bring a wider industry group together for a deeper dive. Q: WHAT’S YOUR OUTLOOK FOR ARIZONA’S CONSTRUCTION INDUSTRY? DK: We see strong trends through 2020 within DPR’s core markets: healthcare,


ABA higher education, advanced technology, commercial and life sciences. Various data sources (Dodge Reports, FMI) reinforce this picture. Overall, the Arizona construction industry growth projections from 2017-2020 are in the range of 15-20 percent, leveling off in 2020. There are also opportunities in the wider commercial sector for us, which includes corporate office and hospitality.

“Two-thirds of construction firms report they are having a hard time filling hourly craft positions that represent the bulk of the construction workforce, according to the results of an industry-wide survey released by the Associated General Contractors of America.”

JK: The Arizona construction industry consolidated during the recession, but in the first two quarters of 2017, we’re seeing more projects coming on the books, and we anticipate that the federal infrastructure funding will continue to increase work. Workforce limitations are going to threaten a robust construction industry recovery, particularly for those contractors who rely on subcontractors for concrete, civil, mechanical and piping services.

DW: The outlook is optimistic – good

and bad. Arizona was slow to recover from the Great Recession. Fortunately, we see the upside in our market as it has gained substantial momentum in 2017. Education and our lack of a sustainable solution to public education funding in Arizona will continue to be a risk to attracting new businesses to Arizona.

SW: Our outlook is stronger than

the national average, but not to the levels that we experienced in the mid2000s. Historically, we see a downturn every seven to 10 years. The severity of the bubble is the bigger question. Fortunately, we’re well positioned to weather downturns as we have over the past 67 years because of our diversity of services.

RE: We are seeing an uptick in

projects and opportunities, but the market is still very competitive. The start of the past downturn was almost ten years ago, but it has lasted for so long that it still doesn’t seem that we are completely out of it. It is too difficulat to predict when a major slowdown will occur in this everchanging environment.

80 | July-August 2017

54%

21%

4%

4%

16%

It will continue to be hard to hire

It will become harder to hire

It will continue to be easy to hire

It will become easier to hire

Don't know

Q: WHAT'S A JOB SITE CHALLANGE THAT YOU FACED AND WHAT LESSON DID YOU LEARN FROM IT? DK: The reality is jobsite or project challenges usually stem from the human factor. Communication issues, unforeseen circumstances, lack of focus or discipline are just a few examples that can cause breakdowns to the already dynamic nature of human interaction. Making sure that we spend the time to really see, support and care for each other is such a crucial piece of the puzzle. Once folks feel seen, supported and cared for, their level of engagement, choice of words, focus and discipline elevates significantly. JK: A common issue faced on

jobsites, which has in the past had a significant negative impact on schedule and cost, are the result of hitting an underground utility that is unknown – gas, water, electric. While our laser scanning and 3-D mapping were successfully addressing above ground tie-ins, it was not until the past few years that we were able to develop and hone our underground mapping technology, which is having a significant impact on projects today.

DW: Things will happen – they always do. We all would like to prevent the unfortunate things that can happen in this business. However, when they do come, it is what we do during and afterwards that leaves an indelible mark. Don’t ignore it. It won’t go away. Attack the issue with energy and passion and make it a growing experience, no matter how painful it may be. RE: Due to the shortage of skilled

labor, subcontractors have to wait on another trade to finish their work before the following trades can get onsite to do their work. This can cause delays on projects or may create the need to work overtime.

SW: It’s too challenging to think of

any one particular situation as a game changer for me. I’ll just say that since I graduated with a construction degree 35 years ago, the industry is safer, smarter and much more collaborative. Did I ever think we could build homes with printers, or envision complex projects with VR goggles? No, but I see amazing things happening regularly in this industry. I learn something new all the time from the smart people that I’m fortunate to work alongside every day.


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Perseverance-HalfPg-Bjerk-120215_Layout 1 12/2/15 1:16 PM Page 1

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ABA

The women of Arizona Builders Alliance By DAVID MCGLOTHLIN

O

f the 9.8 million people working in the construction industry as of 2014, the Bureau of Labor Statistics reports, 872,000 of them, or 8.9 percent, are women. Although construction remains a mostly male-dominated industry, more women enter the field each year, including at the executive and leadership levels. As decision-makers within their respective companies, these women represent a diversity of disciplines along with the hard work and determination needed to be successful in any industry.

LORRAINE BERGMAN

President and CEO Caliente Construction Industry Experience: 28 years Lorraine Bergman, never envisioned being directly involved in operating Caliente Construction when she and her husband Tom founded the company in 1991. However, after the passing of her husband in 2005, she took over as president and CEO. Today, the company is one of the largest woman-owned businesses in Arizona and ranks in the top 50 of all Arizona general contractors. Bergman says, “While the circumstances of my entering the field of construction were both heartbreaking and challenging, the decision to assume leadership of the company has been a blessing.” In 2005, she says, “Many believed the company would not survive under my leadership.” But, 12-years later, Caliente has experienced phenomenal growth and more success than ever. Although Bergman is the 84 | July-August 2017

president and CEO, she considers herself to be like every other employee at Caliente; in the office working each day. She prides herself on being very hands-on and approachable, and takes an active role in every company endeavor, whether it’s visiting jobsites, reviewing bids, meeting with clients or mentoring employees. “When I look back, being a woman was not the issue, but rather my limited industry experience, which was offset by education and perseverance,” she explains. “I love this industry, have learned so much and have had the opportunity to work with amazing people.” Advice: “While you may not be an expert in every aspect of your industry, educate yourself; and surround yourself with people who have the skills and knowledge that compliment your own, and never be afraid to ask. The worse that can happen is they say, ‘No.’”


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ABA ANGIE ZIEGLER

Vice president and CFO General Air Control Inc. Industry Experience: 24 years Before assuming the role of vice president and CFO at General Air Control Inc., Angie Ziegler was a stay-at-home mom. When the company’s Founder Joseph Gac suffered a heart attack in 1993, preventing him from leading the company, Ziegler and her husband Jon became owners of the firm the following year and incorporated the business in 1995. She brings the same nurturing, supportive approach of a stay-athome mom to her new job in the office. Ziegler says, “Initially, as the sole female in the firm, I felt out of place at times, but as I began to play the role of ‘company mom,’ I felt more in my comfort zone.” Her maternal leadership style has since imbedded itself into the company’s culture, which is structured around a family model.

DENISE HERNANDEZ

Admittedly, Ziegler’s biggest challenge was a lack of experience, which she overcame with the support of Jon who first began working for the firm in 1982. Together, they got engaged in industry associations like the Arizona Builders Alliance to network and better educate themselves. Through the ABA, Ziegler eventually crossed paths with Shirley Dail of Shirley’s Plan Service, a woman she greatly respects and admires. Shirley was instrumental in starting the local chapter of the National Association of Women in Construction. Described as a leader, confidant, mentor and friend to both men and women in the industry, Ziegler says, “This incredible woman blazed a trail for our gender at a time when women were restricted to secretarial roles in construction.” Whether it’s her family, work family or anyone else she encounters in her daily walk of life,

Vice president Hernandez Companies, Inc. Industry Experience: 24 years

86 | July-August 2017

Ziegler adds, “There’s no greater joy than to know that you’ve made someone feel valued and appreciated.” Advice:“Trust your instincts. There is a plethora of advice offered in this day of modern technology but a good dose of common sense can go a long way.”

Since she began working at the family-owned business in 1993, Denise Hernandez held many different positions as she learned how each department functioned at every level within Hernandez Companies. “I never thought I would have a career in the construction industry, but when my Dad asked me to join the company,” she says, “I said, 'yes,' and I’ve never regretted my decision.” 24 years later, she’s grateful for the opportunity to work with both her dad and brother who have become mentors and role models for her. She describes them both as positive, hardworking and knowledgeable with a strong work ethic and, adding, “I’ve succeeded in surrounding myself with very strong and intelligent people and that makes me who I am today.” It’s a mode of thinking that she adopted from her father. “He taught us the importance of work ethic, values and surrounding ourselves

with people who are experts in their field,” Hernandez explains. Those principles help define how she approaches the challenges that she may face at work. “We all have challenges regardless of our gender, race or even our ideas,” she adds. “I just do my best to figure out a solution and try again until the issue is resolved.” To date, her favorite project is still the Arizona Cardinal’s stadium in Glendale where the company painted several interior surfaces including University of Phoenix Stadium on top of the stadium’s roof, which Denise viewed first hand after climbing countless stairs to the top. Advice: “I think the key for success for anyone in construction is education, communication and networking. It’s absolutely invaluable to know the people who make up this industry. They are your allies.”


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ABA

Arizona Builders Alliance member projects The Arizona Builders Alliance is a partnership between Arizona chapters of the Associated Builders & Contractors (ABC) and the Associated General Contractors (AGC). It represents more than 300 contractors, suppliers and professional service firms in the commercial construction industry. Here are spotlight projects submitted by ABA's members. 7TH STREET MIXED-USE DEVELOPMENT DEVELOPER: The Opus Group General Contractor: Sundt Construction Architect: Opus AE Group Location: 110 E. University Dr., Tempe Size: 806,081 SF Brokerage Firm: Cushman & Wakefield Value: $116M Start/Complete: December 2016 to July 2018 Subcontractors: Aero Automatic; E&K

Companies; Encore Steel; Kovach Building Enclosures; Mirage Plastering; Southland Mechanical; Walters & Wolf; Wilson Electric

ARIZONA STATE UNIVERSITY STUDENT PAVILION Developer: Arizona Board of Regents; Arizona State University General Contractor: JE Dunn Construction Architect: Weddle Gilmore Black Rock Studio; HGA Architects & Engineers Location: 400 E. Orange St., Tempe Size: 74,653 SF Value: $39.9M Start/Complete: March 2016 to August 2017

Subcontractors: Bell Steel; E&K Companies; Kovach Building Enclosures; Rosendin Electric; TDIndustries

BANNER UNIVERSITY MEDICAL CENTER TUCSON (BUMCT) - NORTH CAMPUS OUTPATIENT CENTER Developer: Banner Health General Contractor: Hensel Phelps Architect: SmithGroupJJR Location: 3838 N. Campbell Ave., Tucson Size: 207,000 SF Value: $64M

Start/Complete: August 2016 to early 2018 Subcontractors: Bel-Aire Mechanical; Charles Court; Coreslab Structures; Delta Diversified; Desert View Painting; DH Pace; Diversified Interiors; El Dorado Metals; Flooring Systems of AZ; Gale Insulation; Glass Unlimited; Harris Rebar; JB Steel; Kazal Fire Protection; Kovach Building Enclosures; Magnum Paving; Partitions

88 | July-August 2017

The mixed-use development will feature a 20-story and 12-story tower with 407 market-rate apartments built on a five-level podium. The project will also include approximately 30,000 SF of retail and restaurant space on the ground floor.

As a leader in Climate Net Neutrality and sustainable building, ASU’s goal for the Student Pavilion is to be a Net Zero Energy building, making it the first facility on any ASU campus to solely operate on energy produced on-site.

& Accessories; Progressive Roofing; Schindler Elevator; Stone Finish; Sun Valley Masonry; Sunland Asphalt; TP Acoustics; Universal Wallboard; Western Millwork The expansion consists of a multispecialty health center to house outpatient specialty clinics. The project will also include a 3-story, 962-stall parking garage.


BARNONE Developer: Johnston Properties General Contractor: Caliente Construction Inc. Architect: DeBartolo Architects Location: 300 E. Ray Rd., Gilbert Size: 12,350 SF Value: $4,046,000 Start/Complete: February to November 2016 Subcontractors: Architectural

Building Systems; Crawford Mechanical; Kortman Electric; RNR Steel; Ryan Mechanical The project consisted of converting the developer’s existing, familyowned, 1950s Quonset Hut into a unique multi-use facility in Agritopia that includes a brewery, machine-shop, gun workshop and restaurants. 89


ABA CASA DE LOS NIÑOS Developer: N/A General Contractor: Barker Contracting Architect: WSM Architects Location: 1120 N. Fifth Ave., Tucson Size: 42,000 SF (Office); 21,000 SF (Garage) Value: $10M Start/Complete: November 2016 to February 2018 Subcontractors: Achilles Air Conditioning; Cole’s Custom Painting; Comfort Systems USA; Complete Door; Corbins Electric; Glass Unlimited; Kerr

Masonry; Magnum Paving; Millwork By Design; Navarrete Fire Protection; Preston Insulation; Progressive Roofing; Suntec Concrete; The Groundskeeper; Tucson Commercial Carpet; Utility Underground The nonprofit promoting child well-being and family stability is expanding its facility to accommodate the needs of the community. The project includes site demo and utility relocation to complete an underground parking garage and two stories of office above.

DOVE MOUNTAIN VETERINARY CLINIC Developer: Cotlow Company General Contractor: Epstein Construction Architect: Associated Architects Inc. Location: 12110 N. Dove Mountain Blvd., Marana Size: 6,682 SF Value: $1,646,138 Start/Complete: August to December 2016 Subcontractors: Achilles Air Conditioning Systems; A.I.S. Industries; Architectural Openings; Babby Building Specialties; CMR Construction; Compete Door Systems; Cutler Fire Protection; Desert Earth Contracting; DOWL; Flooring Systems of Arizona; Forever Lawn Southwest; Gale Contractor Services; Gamble Electric; Hiller & Sons Painting; JKaiser Workspaces; J.B. Steel; Janning’s Acoustical Design; Kerr Masonry; L.M. Hanna Co.; Millwork By Design; Native TeleData Solutions; N-R-G Foam; Progressive Roofing; Santa Rita Landscaping; The McNary Company; TrueCore Cleaning; Universal Wallboard Corporation; Wall Systems This clinic is designed as a full-service veterinary care facility including surgery, X-Ray, ultra sound, dental facilities, grooming and boarding services.

HARRAH’S AK-CHIN CASINO RESORT EXPANSION Developer: Ak-Chin Indian Community General Contractor: Sundt Construction; Yates Construction Architect: TBE Architects Location: 15406 N. Maricopa Rd., Maricopa Size: 670,000 SF Value: $160M Start/Complete: August 2016 to Q2 2018 Subcontractors: Aero Automatic; Edwards Electric; MKB Construction; TDIndustries; Walters & Wolf The project includes an expansion and renovation of the existing casino, a new bingo facility, central plant and pedestrian bridge connection to the adjacent multi-tainment center. 90 | July-August 2017


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We keep you on time, too. Since its inception, AROK has completed approximately 2,500 jobs on time and within budget. (602) 997-1492 AROK.COM

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ABA MACH 1 (BUILDING 1 & 2) Developer: Trammell Crow Company General Contractor: Willmeng Construction Architect: Butler Design Group Location: 2222 & 2290 E. Yeager Dr., Chandler Size: 105,000 SF (per building) Value: $15.25M Start/Complete: February 2015 to February 2016

The development of a 20-acre site in the Chandler Airpark into office space is

designed to harbor collaborative work areas for technology companies.

MORRISON RANCH SENIOR LIVING COMMUNITY Developer: CA Ventures General Contractor: W. E. O’Neil Construction Co. Architect: BKV Group Location: E. Morrison Ranch Parkway and S. Higley Road, Gilbert Size: 98,956 SF Value: $17.5M Start/Complete: February 2017 to April 2018 Subcontractors: AFP Fire Protection; A.M.E. Electrical Contracting; Beecroft; Border Glass & Aluminum; CHS Plumbing Arizona; Efficiency Mechanical II; Hardrock Concrete Placement Co.; Milling Machinery; NV & Sons Builders; Sprayfoam Southwest; ThyssenKrupp Elevator Corporation The two-story, 98,956-square-foot community will house 115 assisted living and memory care units, as well as typical senior living common areas and a full-service kitchen.

ORO VALLEY SENIOR LIVING COMMUNITY Developer: CA Ventures General Contractor: W. E. O’Neil Construction Co. Architect: HED Architects Location: 9005 N.Oracle Rd., Oro Valley Size: 79,468 SF Value: $14.6M 92 | July-August 2017

Start/Complete: February 2017 to April 2018 Subcontractors: Achilles A/C Systems; Allan Fire Protection Systems; Catalina Mechanical Contracting; CMR Construction; Complete Door Systems; Glass Unlimited; GRG Construction Company; J.B. Steel; K2 Electric; Kerr Masonry; Progressive Roofing; Ron’s

Concrete Construction; Sierra Woodworks; The Groundskeeper; Tom White Carpentry; Wiese Painting Contractors The project consists of a 79,468 square feet, two-story facility with 101 assisted living and memory care units.


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ABA RENAISSANCE PHOENIX HOTEL RENOVATIONS Developer: N/A General Contractor: Holder Construction Company Architect: Gensler Location: 50 E. Adams St., Phoenix Size: Varies Value: $9.5M Start/Complete: June 2016 to January 2017 Subcontractors: Dickens Demolition; E&K Companies; Hardscape Technologies; Integrated Landscape Management; Jenco Electrical; KT Fabrication; Red Cedar Steel; Western Millwork Some of the renovations included improvements to the exterior façade, lobby expansion, renovated bar and coffee shop, enhanced streetscape and shade around the entire building.

WICKENBURG COMMUNITY HOSPITAL ADDITIONS Developer: Wickenburg Community Hospital General Contractor: W.E. O’Neil Construction Architect: Highton Company Location: 520 Rose Ln., Wickenburg Size: 27,000 SF Start/Complete: April 2015 to July 2016 Subcontractors: Division 3 Structures; Glass Unlimited; Kerr Masonry; Holderness; Progressive Roofing; Saguaro Steel; TDIndustries; Wilson Electric The project consisted of adding a new 11,000 SF surgery center, 11,000 SF medical office building and an additional 5,000 SF of renovations to the existing hospital. 94 | July-August 2017

WORLD VIEW ENTERPRISES HEADQUARTERS Developer: Pima County General Contractor: Barker Contracting Architect: Swaim Associates Location: 1805 E. Aerospace Pkwy., Tucson Size: 140,000 SF Value: $12M Start/Complete: February to December Subcontractors: Achilles Air Conditioning; Architectural Openings; Cole’s Custom Painting; Dirtworks Contracting; Magnum Paving; Millwork By Design; Mountain Power Electric;

Myrmo & Son, Inc.; Navarrete Fire Protection; Preston Insulation; The Groundskeeper; Steadfast Structures; Steve Seidel Plumbing; Suntec Concrete; Tucson Commercial Carpet The new home of the Tucson-based startup consists of approximately 20,000 SF of open office space and the rest is designed for light manufacturing of large balloons used to carry payloads and manned capsules to the edge of the earth’s atmosphere for both private entertainment and public and private research voyages.


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AZRE July/August 2017  

This issue of AZRE is a special edition featuring the Most Influential Women in CRE. Each has broken through the industry’s glass ceiling wi...

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