Quarterly Report Fiscal Year 2010-2011 4th Quarter · 9. Happy Harvester Hydroponics Happy...

City of Chandler

Economic Development Division

Quarterly Report Fiscal Year 2010-2011 4th Quarter

INDEX

Table of Contents

INTRODUCTION .............................................................................................. 3

ECONOMIC DEVELOPMENT OUTLOOK .................................................... 5

ECONOMIC TRENDS ..................................................................................... 8

RETAIL ............................................................................................................ 10

INDUSTRIAL/OFFICE DEVELOPMENT ....................................................... 14

TOURISM ........................................................................................................ 18

DOWNTOWN ................................................................................................. 21

Economic Development Division May 1, 2012 2

INTRODUCTION

Economic development activity continued on a positive trend during the fourth quarter, in lieu of the year’s economic downturn. For the quarter ending June 30, 2011 Economic Development staff combined identified 12,536 leads and19 prospects that represent in an estimated 390 jobs, occupied approximately 180,860 square feet of space and secured $9,483,780 in capital investments.

4th Quarter Combined Efforts

Retail Industrial/Office Tourism Total Leads 12 42 12,482 12,536 Prospects 8 11

19

Jobs 93 297

390 Square Footage 110,052 70,808

180,860

Capital Investment

9,483,780

$9,483,780

Retail: During the fourth quarter, Economic Development retail staff continues to work with developers, brokers, and shopping center owners on major retail developments while tracking all existing retail centers and tenants, including those projects under-construction or planned. Staff continues to work with their clients by keeping track of when the construction permits are reviewed and issued.

For Q4, Retail staff participated in the following activities:

Activity Location Date ICSC ReCon Global Real Estate Conference Las Vegas, NV May 22 – 25, 2011

Industrial/Office: During the fourth quarter, Industrial and Office staff attended several sales missions and prospecting trips to market Chandler’s message to a broader audience and provide insight into existing development opportunities in the City of Chandler. Sales Mission, trade shows, and prospecting trips provide staff with the chance to discern the type of data and resources the brokerage and development community needs thereby facilitating the attraction of quality stores, restaurants, companies, and recreational opportunities to Chandler. For Q4, Industrial/Office staff participated in the following activities: Activity Location Date GPEC Sales and Sales Mission Washington, DC April 3 -6, 2011

Laid Off Camp Chandler, AZ April 30, 2011


INTRODUCTION

Activity Location Date CoreNet & GPEC Sales Mission Chicago, IL May 1 -3, 2011

AAED Spring Conference Prescott, AZ May 11 - 13, 2011

Vibrant Phoenix Chandler, AZ June 3, 2011

Bio International Washington, DC June 26 – July 1, 2011 Tourism: Tourism staff conducted the following trade and media activities for Q4: Activity Location Date

Sunny Arizona FAM Chandler, Tempe, Mesa and Apache Junction, AZ March 31 – April 2, 2011

Broker Event Chandler, AZ April 27, 2011 Tourism Stakeholders Conference Chandler, AZ June 8, 2011

Summer Focus Group Chandler, AZ June 28, 2011 In addition to trade and media activities and travel, staff generated 12,482 leads by the end of June 30, 2011. Downtown: Downtown Redevelopment staff continues to work with the merchants to collaborate in advertising and promoting their business in Historic Downtown Chandler. Staff coordinated efforts with the Downtown Chandler Community Partnership (DCCP), Arts Commission, Façade Grants, Site 8 Parking, Urban Gardening and various Special Events which is significant to Downtown Chandler fruition.

Disclaimer: Content is intended to provide general information to the public and every effort has been taken to ensure that the information is accurate. Data is submitted subject to the possibility of errors, omissions and changes, but is obtained from sources and/or formulas deemed reliable.


ECONOMIC DEVELOPMENT OUTLOOK

Economic Development focus is essential to the City of Chandler’s estimated population of 237,673 citizens and approximated 95,025 housing units located in the City’s borders as of June 1, 2011. Therefore, locating and expanding quality industrial, commercial, retail, and small business opportunities throughout the City of Chandler and Downtown Chandler are of great importance to Chandler’s future economic impact. Economic Development personnel continually update economic data, demographic and development trends, to maintain current information to better assist clients with their search for potential development opportunities. The information also aids Economic Development staff in identifying areas of opportunity: specific gaps, target retail markets, provide linkages to key census information and assist in presenting available sites.

FY 10-11


120 177 165 93

1085

3,037

341 297

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 Q2 Q3 Q4

Jobs Created

Retail

Industrial/Office


Past, present and future vitality of the City of Chandler relies on job growth and demographic factors.

With the migration of educated workers, sustainable increases in population, high education choices and a pro-business record, lays the groundwork for healthy job creation and employment opportunities during the fourth quarter.

Q1 Population 236,598 236,702 236,822

Jul. Aug Sep

Q2 Population 236,909 237,014 237,161

Oct Nov Dec

Q3 Population 238,604 238,719 238,839

Jan Feb Mar

Q4 Population 237,623 2,337,591 237,673

Apr May Jun

FY 10-11

FY 10-11

Source: City of Chandler Planning Division


110,052

152,883

67,965

25,318

Retail Square Feet Q1

Q2

Q3

Q4

227,007

1,977,000

262,322 70,808

Industria / Office Square Feet

Q1

Q2

Q3

Q4


Source: City of Chandler Planning Division June, 2011

Population Growth

$18.0

$19.0

$20.0

$21.0

$22.0

$23.0

$24.0

Q1 Q2 Q3 Q4

Sales Tax Collected

FY10-11Source: City of Chandler, Sales Tax & Licenses


ECONOMIC TRENDS

By the end of the fourth quarter the City of Chandler average unmeployment rate was at 7.0%, meanwhile employment rate figures released by arizona department of commerce show a steady increase for this quarter.

July Aug Sep Oct Nov Dec

Q1 Q2

1st & 2nd Quarter Unemployment Rate

Arizona

Phoenix

Chandler

Source: Arizona Department of Commerce FY 10-11

FY 10-11


Jan Feb Mar Apr May Jun

Q3 Q4

3rd & 4th Quarter Unemployment Rate

Arizona

Phoenix

Chandler

Source: Arizona Department of Commerce

ECONOMIC TRENDS

FY 10-11

Employment by Occupation Data identifies and analyzes total employee counts per establishment within various industries.

Source: Arizona Department of Commerce

FY 10-11


RETAIL

Economic Development Retail staff located nine new companies that included a restaurant, grocery/food concept, gas station, and specialty retail to the City of Chandler.

Specific Q4 Retail activities:

1. Big O Tires: A grassroots collective of proudly independent tire dealers founded Big O Tires in 1962. Nearly half a century later, Big O tires has evolved into one of North America’s largest retail tire franchisors, with nearly 500 locations in 21 states.

2. Coal Burger Coal Burger is a fast casual burger concept based on fresher ingredients and coal fired flavor while using all natural products and ingredients. The burgers are prepared in a coal-fired brick oven to flavor. The Coal Burger menu also features fresh made salads, gelato shakes, and a wide variety of natural and organic beverages.

3. Grimaldi's Pizzeria Grimaldi’s Pizzeria offers coal fired brick oven that gives the New York style thin crust pizza and calzones a unique flavor and crisp crust. Grimaldi’s offers over 100 years of pizza making traditions.

4. Lizard Thicket

Lizard Thicket, established in 1981, prides itself in selling the latest, most fashion-forward styles and accessories at an affordable price. Lizard Thicket carries a limited quantity of each piece thus, the wardrobe is unique, and the selection is constantly changing.

Q 1 Q 2 Q 3 Q 4

Retail

Prospects

Leads

FY 10-11


RETAIL

5. The Habit Burger For almost 40 years, the Reichard brothers’ passion for making the tastiest burgers has fueled the success of Habit Burger Grill. Brent and Bruce Reichard purchased the Santa Barbara Habit Burger in 1973 after Brent worked at the restaurant four years. Habit Burger serves 100% fresh beef hamburgers, tasty grilled sandwiches, and fresh salads.

6. Dunkin Donuts Dunkin Donuts is one of America’s favorite every day, all day stop for coffee, baked goods and much more.

7. Verde Salon Verde Salon is a non-toxic salon environment utilizing Organic Color Systems hair color. They also feature a small boutique supplying natural and organic beauty products. The salon has adopted conservation techniques including water and power reduction throughout the salon. Verde features no-VOC paint, soy-based stain on the floors, and bamboo furniture with non-toxic stain.

8. So Cute Boutique So Cute Boutique carries boutique brand clothing & accessories and other great brands and products at fantastic prices.

9. Happy Harvester Hydroponics Happy Harvester Hydroponics is the easy way to grow fresh herbs, vegetables, fruits and flowers indoors, all year long without the need for soil or natural sunlight. Whether you are a professional hydroponics gardener or indoor gardening hobbyist, Happy Harvesters Hydroponics offers unique hydroponics supplies that help you successfully grow plants that are more productive.


RETAIL

Staff efforts in this quarter produced 93 new jobs and occupied 25,318 square feet of retail in the City of Chandler.

RETA

IL

NAME LOCATION Jobs S.F.

1st Quarter QuickTrip Arizona & Queen Creek 10 5,104 Old Spaghetti Factory Loop 101 & Frye 50 10,240 Rally’s Burgers Alma School & Chandler 15 1,756 Aron’s Gilbert & Germann 10 8,480 Swapsmart Arizona & Warner 10 66,370 Good Food Market Alma School & Chandler Heights 25 18,102

2nd Quarter Sozo Coffee Alma School & Warner 2 1,000 Otaku Sushi Gilbert & Ryan 10 3,681 Target Arizona & Ocotillo 150 135,000 Razmataz 54th St. & Ray 15 12,000 Chandler BBQ Alma School & Germann 0 1,202

3rd Quarter US Egg Kyrene & Chandler 26 5,747 Rock Taco Cantina Loop 101 & Frye 20 4,948 Crowded House Dobson & Germann 180 16,130 Extreme Air McQueen & Pecos 30 29,280 Elements Massage 54th St. & Ray 25 1,700 BLD Restaurant Dobson & Germann 40 4,711 Planet Subs Dobson & Germann 20 1,221 The Disney Store Loop 101 & Frye 0 4,228

4th Quarter Big O Tires Gilbert & Germman 10 6,228 Coal Burger 54th St & Ray 15 2,264 Grimaldi's 54th St & Ray 25 4,429 Lizard Thicket Loop 101 & Chandler 4 2,325 The Habit Burger 54th St & Ray 15 3,200 Dunkin Donuts McQueen & Riggs 12 2,600 Verde Salon Dobson & Germann 7 1,650 So Cute Boutique Dobson & Germann 3 1,005 Happy Harvesters Hydroponics Arizona & Loop 202 2 1,617


RETAIL

FY 10-11

FY 10-11

FY 10-11

FY 10-11


INDUSTRIAL/OFFICE DEVELOPMENT

Economic Development Industrial and Office staff efforts located eight new companies to the City of Chandler with a wide range of office and industrial retention and expansion sites.

Specific Q4 Industrial/Office activities:

1. Lumber Liquidators Lumber Liquidators prides itself with having one of the largest inventories of pre-finished and unfinished hardwood floors in the industry. They offer a variety of brands for residential and commercial construction. Lumber Liquidators carries laminate flooring, bamboo flooring, cork flooring, and butcher blocks. Lumber Liquidators negotiates directly with the mills to buy an entire years production. This tactic eliminates the intermediary and allows the savings to be passed on to the customers. Lumber Liquidators warehouse is located at Gilbert Road and Loop 202.

2. Paradise Bakery Commissary Paradise Bakery Commissary has over 60 company-owned or franchised locations in 9 states. In 1976, the founders of Paradise Bakery & Cafe created their first freshly baked cookies and muffins in Long Beach, California. As they became more successful, they continued to expand their menu selections adding a variety of meals including soups, salads, and sandwiches. Paradise Bakery Commissary is located in Chandler Pavilions at 50th

Q 1 Q 2 Q 3 Q 4

Industrial

Prospects

Leads

FY 10-11



3. Chandler Memory Care Facility Chandler Memory Care Facility will provide direct care to patients suffering from a variety of memory related diseases with a specific focus on Alzheimer's and other forms of dementia. The 40 residential units have the ability to provide accommodations for 67 residents. Units can both be private or semi-private, and include bathrooms, closet space, and furniture to create a residential atmosphere.

4. Broadcom Broadcom is a global leader and innovator in semiconductor solutions for wired and wireless communications. Broadcom products seamlessly deliver voice, video, data, and multimedia connectivity in the home, office, and mobile environments.

5. Radian Research Radiant Research provides comprehensive clinical research services to advance the science of medicine. Our dedicated and experienced medical professionals conduct human clinical research with compassion and respect for our research participants. They deliver timely, accurate data that ultimately enhances the drug development process and improves people's lives through the advancement of safe and effective drug therapies.



Staff efforts in this quarter produced 297 new jobs and occupied of 70,808 square feet of industrial and office space, in addition to a projected capital investment of $9,483,780.

Indu

stri

al /

Offi

ce

NAME LOCATION Jobs S.F. Capital Investment

1st Quarter Kimball Concepts North

Chandler 25 10,000 $200,000

Academy Mortgage Airpark Area 55 10,648 $648,600 Gangplank and Affiliated Anchors Downtown 35 6,500 $450,000

Unisource Worldwide Airpark Area 55 23,000 $750,000 EDMC Price Corridor 750 90,859 $5,735,000 International Rectifier Price Corridor 80 26,000 $900,000 Arizona Nutritional Supplements (retention/expansion)

North Chandler 75 50,000 $50,000

BMWC Construction Inc. North Chandler 10 10,000 $300,000

2nd Quarter Sierra Presicion West Chandler 5 5,000 $500,000

Ebay/PayPal Price Corridor 2,000 188,000 $40,640,000

Chandler Regional Medical Center Expansion (Cardiac Cath Lab)

Price Corridor 25 60,000 $25,000,000

Digital Realty Trust (Expansion) Price Corridor 7 240,000 $0

Intel (Expansion) Price Corridor 1,000

1,484,000

$5,000,000,000

3rd Quarter Duncan Systems Inc. South Chandler 26 8,705 $424,100 Blue Cross Blue Shield West Chandler 20 3,643 $364,300 Kovach II West Chandler 180 62,533 $84,556,640 AZ Dynamics South Chandler 30 17,441 $692,944 Bank of America Data Center South Chandler 25 157,000 $30,000,000 Av-Air West Chandler 40 13,000 $1,950,000 Inyati West Chandler 20 0 $1,500,000

4th Quarter Lumber Liquidators East Chandler 40 4,500 $400,000 Paradise Bakery Commissary West Chandler 60 7,388 $1,750,000 Chandler Memory Care Facility South Chandler 125 32,775 $5,085,880 Broadcom West Chandler 60 21,159 $2,005,900 Radiant Research South Chandler 12 4,986 $242,000



FY 10-11

1,085

3,037

341 297

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1 Q2 Q3 Q4

Jobs Created

227,007

1,977,000

262,322 70,808

Q1 Q2 Q3 Q420,000

520,000

1,020,000

1,520,000

2,020,000

2,520,000

Total Sqare Feet


TOURISM

Economic Development Tourism staff facilitates a multi-layered tourism-marketing program that goes beyond tradeshows, tours, and sales missions. Chandler’s tourism industry measurements for Q3 reflect gains that are more positive for the hotel Occupancy, Average Daily Room Rate (ADR), and Revenue per Available Room (RevPar) markets as reported by Smith Travel Research, Inc. which are represented in the charts below:

0%

20%

40%

60%

80%

Q1 Q2 Q3 Q4

47% 60.6%

77.8% 67.1%

Chandler Hotel Occupancy Rate

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

Q1 Q2 Q3 Q4

$75.56

$86.41 $104.27 $86.78

Chandler Hotel ADR

FY 10-11

FY 10-11


TOURISM

The hotel industry in Metro-Phoenix Valley continues to struggle with ADR growth and many operators continue to offer price-conscious travelers low room rates as an incentive for booking thereby trading occupancy at the expense of room rate and is the driver behind the growth in RevPar. While continued growth in the Valley’s hospitality industry is apparent, the Valley continues to lag behind the rest of the nation. Metro Phoenix Comparison Q1 Q2 Q3 Q4

Occupancy 47% 60.6% 77.8% 67.1% Occupancy 44.9% 57% 73.0% 57.1% Average Daily Rate $75.56 $86.41 $104.27 $86.78

Chandler Average Daily Rate $78.01 $97.29 $123.27 $101.47

Metro Phoenix

Revenue per available room $35.67 $52.47 $81.12 $58.34 Revenue per available room $35.00 $55.46 $89.93 $57.91

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

Q1 Q2 Q3 Q4

$35.67 $52.47

$81.12 $58.34

Chandler Hotel RevPar

FY 10-11


TOURISM

Tourism staff also maintains the tourism website, www.visitchandler.com that is featured in each advertisement, brochure, and press release and it is utilized at trade shows. Tourism staff efforts to date generated a combined 12,482 new leads to the City of Chandler.

Q1Q2

Q3Q4

FY 10-11

FY 10-11


http://www.visitchandler.com/

DOWNTOWN

Downtown Redevelopment staff continues to work with the submission of award applications for Arizona Avenue. In addition, Downtown Chandler won The Arizona Public Works Association Transportation Project of the Year.

Downtown Redevelopment staff Q4 accomplishments:

San Marcos Commons Phase II: The Development Agreement and Lease language was fleshed.

COR – Site 7: Downtown Redevelopment staff participated in a design charrette and preliminary discussions on a utility public-private partnership.

Façade Grants: Downtown Redevelopment staff reviewed three façade grant applications and identified policy issues, which were subsequently forwarded to City Management for further decision.

Site 8 Parking: Council approved the Site 8 parking overlay.

ARTyard: Continues with tours and meetings related to the open ARTyard RFP. Staff worked with Collins College on media coverage as a branding campaign.

Special Events planned for next fall:

• Weekly Farmer’s Markets continues. • The monthly ArtWalk’s became even more successful. • Downtown hosted the AmeriCAN Craft Beer Festival and Summer Splash, which

were both a success.

Block Party: A rebranding of Block Party to “Chandler Rock the Block” was undertaken. A second stage of professional music was added to the event. In addition, branding and sponsorship packages are under development.

Maintenance Activities: Site 6 was repaved and roadside fencing was installed to keep motorists off the sidewalks. Contracts were executed for repairing beams and joints on the colonnade; including a full reroofing which is all scheduled for July 2011. In addition, repaired and reinstalled park signs on modified footings.

Entertainment District: Downtown Redevelopment staff identified key contacts at local churches and school district, as a result meetings will be held with these groups prior to public meetings in the late summer.

Reuse of Blue Peacock: City Management received several options for further review and direction.


DOWNTOWN

EMSD: DCCP contract was executed and all documents provided to the County Assessor.

DCCP Signage: Downtown Redevelopment staff worked with DCCP on various proposals for the AZ Avenue signage package and the DCCP Executive Committee is finalizing their counterproposal.

DCCP Trash: Downtown Redevelopment staff identified a redevelopment location for beginning the trash pilot service.

San Marcos Golf Resort: Downtown Redevelopment staff continued working with firms doing due diligence related to the San Marcos Resort bankruptcy filing.

Downtown Banners: Downtown banners have survived two major dust storms. Any prior damage has been repaired and the banners have been reinstalled.

New and Potential Tenants: Downtown Redevelopment staff spoke with five potential tenants seeking retail, restaurant or office space.

NW Quadrant Analysis: Downtown Redevelopment staff worked with the Planning Department on seeking assistance to develop a more detailed plan for the area outlined for future growth.

Website Revision: Downtown Redevelopment staff began developing a new architecture for Downtown Redevelopment website pages.


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