BRANDON BROWN, 8 BULKING UP ASU

[Pages:10]Fox heads downtown

Restaurateur plans to open first eatery in Block 23

BRANDON BROWN, 8

January 25, 2019

BULKING UP ASU

Charley Freericks is pushing forward with the next phases of the Novus Innovation Corridor project, designed to fund Arizona State University athletics. If it goes according to plan, it could be a $1 billion development. CORINA VANEK REPORTS, 4-6

American City Business Journals - Not for commercial use

COMMERCIAL REAL ESTATE

Hines wraps up $75M Chandler offices

Built on the former site of Elevation Chandler, the new project is the East Valley city's largest multitenant space. CORINA VANEK, 11

RESIDENTIAL REAL ESTATE

West Valley cities draw buyer interest

A report from online home sales site OpenDoor found buyers leaning that way. ANGELA GONZALES, 10

EXECUTIVE INC.

PRACTICING LAW AND ANTHEMS 21

JIM POULIN | PHOENIX BUSINESS JOURNAL

Largest law firms 18, 20 LEGAL EFFECTS OF #METOO VARY

Two local attorneys see a different impact on the number of women sharing sexual harassment allegations. DEREK HALL, 19

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PHOENIX BUSINESS JOURNAL

READER GUIDE

R PEOPLE IN THIS ISSUE

ABC Anderson, Chris ............ 11 Anderson, Tyler ............ 10 Andrade, Marise............ 16 Bardaweel, Nabeel ........ 11 Benjamin, Shane ........... 11 Bocelli, Dominic............ 11 Bouma, John .................. 3 Brnovich, Mark ............... 4 Colangelo, Jerry............ 10

DEF David, Cliff ................... 11 Fox, Sam ........................ 8 Fraint, Eric ................... 16 Freericks, Charley ........... 4

GHI Gebing, Steve ............... 11 Glassman, Rodney......... 21 Hanrahan, Kathy ........... 17 Hartke, Kevin................ 11 Hixson, Tyler ................ 10

JKL Joyce, Patrick ................. 3 Koller, Derek................. 11

MNO McCarthy, Sean............... 4 Olsen, Morgan ................ 4 Osanloo, Michael ............ 8

PQR N/A

STU Schwabenlender, Amy ... 16 Serdy, Jeff ...................... 8 Sherman, Neil............... 11 Shore, Michael.............. 16 Smialek, Kiera............... 24 Smith, Ryan.................... 8 Stewart, Joe ................... 3

VWXYZ Wagenhals, Fred ........... 17

R COMPANIES IN THIS ISSUE

123 29th Street Capital........ 17

ABC A New Leaf ................... 16 Allegiant Air ................... 8 Ammo Inc..................... 17 Ariz. Behavioral Health.. 16 Arizona State University .. 4 Arizona Tax Research Assoc. .............. 4 Arrogant Butcher ............ 8 Axon Enterprise ............ 17 Bankers Trust Co. ............ 3 Barrett-Jackson Auction Co...................... 3 Beus Gilbert.................. 21 Blanco Tacos & Tequila .... 8 California Pacific Airlines .......................... 8 Catellus.......................... 4 CBRE........................ 4, 10 Community Bridges....... 16 Cushman & Wakefield...... 4

DEF Flair Air.......................... 8 Fox Restaurant Conc........ 8 Friendly House.............. 16 Fry's Food Stores ............ 8

GHI Hagerty.......................... 3 Hines Interests.............. 11 HOM ............................ 16 Human Services Campus ........................ 16 Institutional Property Adv. ............... 11

JKL Jagemann Stamping Co. ................ 17 JDM Partners................ 10 JPMorgan Chase ........... 11

MNO Modern Milk ................. 24 Natural Kid Doc............. 24 Opendoor ..................... 10

PQR Phx-Mesa Gateway Airport ............. 8 Portillo's Rest. Group ...... 8

STU Snell & Wilmer................ 3 Sperry Commercial........ 11 Stantec ........................ 11 State Farm...................... 4 SW Kenetics.................. 17 SW. College of Naturopathic Med. ........ 24 Swoop............................ 8 Terracon....................... 11 Tides Equities ............... 17 UMOM New Day Centers .................. 16

VWXYZ Weidner Apart. Homes .. 11 WestJet.......................... 8 Workuity ...................... 11 Your Part-Time Controller..................... 16

R VIEWPOINT SUBMISSION GUIDELINES

Keep your comments brief and civil, and remember to mention which news story you're writing about. Submissions for "My View" or "Letters to the Editor" may be edited and published or otherwise used in any medium.

R CORRECTIONS

Fair and accurate coverage is at the heart of our mission. We will promptly print corrections of substantive errors. If you believe incorrect or unfair information has appeared in the Phoenix Business Journal, please contact Editor-in-Chief Greg Barr.

Phoenix Business Journal is a publication of: American City Business Journals, 120 W. Morehead St., Charlotte, N.C. 28202 Whitney Shaw, CEO; Ray Shaw, Chairman (1989-2009)

American City Business Journals - Not for commercial use

R COMING UP



R February 1: Wealthiest ZIP Codes

R February 8: Industrial CRE developers Dental insurance companies

R February 15: Engineering firms Office furniture companies

We are currently surveying for the mechanical contractors and electrical contractors lists. To be included, email Dale Brown at dbrown@ to request a survey.

REPRINTS

Capitalize on positive news and grow your business. Get the word out with reprints, e-prints and commemorative plaques. Contact Chris Jansen at 602-3086540 or cjansen@ .

PROVIDED BY BARRETT-JACKSON

A $251M KICKOFF TO THE SEASON

Many prognosticators nationwide seem to believe the economy is headed for a slowdown during 2019, but Arizona has started the year with a bang, seeing $251 million worth of autos sold to kick off our winter tourism season.

Across seven auto auctions held during Arizona Car Week -- arguably the official start to the region's spring tourism season -- sales of collectible cars and autos were up just over 1 percent, with 2,660 total cars sold. Scottsdalebased Barrett-Jackson led the pack with a recordsetting $126.4 million in sales.

Next up is the Waste Management Phoenix Open, and by all accounts -- adding more

suites, for example -- the always-popular golf tournament will be another big draw for the Valley. Then, the Cactus League hosts its season that will undoubtedly bring spring break crowds and fans from colder climes.

Add in that the Valley continues to add jobs and population and any talk of an economic slowdown

around these parts is premature at best. - Tim Gallen

DIGITAL AND SOCIAL MEDIA

R Morning Edition: An email digest of top stories from local, regional and national sources.

R Afternoon Edition: Afternoon roundup of the day's stories.

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R Twitter: Follow us @PhxBizJournal R Find us on: Facebook, LinkedIn

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NEWS TIPS

Contact reporters directly, or send news tips to Managing Editor Patrick O'Grady at pogrady@ and Digital Editor Tim Gallen at tgallen@.

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JANUARY 25, 2019 VOLUME 39, NUMBER 26

MARKET PRESIDENT AND PUBLISHER:

Ray Schey, 602-308-6500 rschey@

EDITOR-IN-CHIEF: Greg Barr 602-308-6513, gbarr@

MANAGING EDITOR: Patrick O'Grady 602-308-6519, pogrady@

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PHOENIX BUSINESS JOURNAL (ISSN 0895-1632) is published weekly, every Friday. Single copy $6, subscription rate is $140 per year for print and digital or $115 for digital only, plus tax. Copyright ? 2018, Phoenix Business Journal. All rights reserved. POSTMASTER: Send address changes to the Phoenix Business Journal 101 N. First Ave., Suite 2300, Phoenix, AZ 85003. Periodicals postage paid at Phoenix, AZ.

JANUARY 25, 2019

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NEWS

American City Business Journals - Not for commercial use

R NAME TO KNOW

PATRICK JOYCE

Named the new Arizona market president for Bankers Trust Co., which has three locations in the Valley. Joyce will take over for Joe Stewart, who plans to retire in 2020.

R NUMBER TO KNOW

This 2019 Ford GT Heritage, which sold for $2.5 million for charity, made the list of top 10 cars sold last week.

PROVIDED BY BARRETT-JACKSON

$251 million

Total amount paid for vehicles at seven collectors auction held in the Valley last week, an increase of about 1.2 percent over 2018's totals, according to classic car insurer Hagerty. The auctions were led by Scottsdale-based BarrettJackson, which sold more than $126 million worth of sought-after cars.

R IN MEMORIAM

PROMINENT ARIZONA ATTORNEY JOHN BOUMA DIES AT 82

Prominent Arizona attorney John Bouma, a partner and former chairman of Snell & Wilmer law firm, died Tuesday night after being hit by two vehicles near 7500 N. Seventh St. in Phoenix.

Phoenix Police investigators believe Bouma, 82, was trying to recover something from the street about 9 p.m. when he was hit by a Toyota Tacoma traveling north, according to an ongoing investigation. The collision pushed Bouma into the southbound lane where he was hit a second time by a Jeep Patriot.

The fire department took Bouma to a local hospital where he was pronounced dead, police said. Officials said in their report the drivers of the two vehicles did not appear to be speeding or impaired.

Bouma was a respected Valley lawyer and philanthropist for nearly six decades.

After graduating from the University of Iowa law school in 1960, Bouma served as a captain in the U.S. Army Judge Advocate General's Corps at Fort Huachuca in Sierra Vista. Frank Snell, one of the founders of Snell & Wilmer, hired Bouma in 1962.

Snell & Wilmer appointed Bouma chairman in 1983, and he led the firm for 32 years, helping to expand it beyond Phoenix. The firm now includes more than 400 attorneys across 11 offices in

FILE PHOTO

Snell & Wilmer's John Bouma was killed in a traffic accident on Jan. 22.

the U.S. and Mexico, according to its website.

"In terms of the firm moving forward, John's spirit is deeply embedded in this firm and his values are woven into our fabric," said Matthew Feeney, who succeeded Bouma as chairman in 2015. The two had been friends and colleagues for more than 30 years.

No date has been set for a public memorial for Bouma, although the firm and family are working on those plans, Feeney said.

- Derek Hall

R EDITOR'S PICK

VALLEY HOUSING COMING IN SEVERAL STRIPES

The Valley is again seeing an influx of tens of thousands of people moving to the region annually, and it continues to provide a large measure of optimism for the multifamily industry.

Apartments have sprouted locally like no other commercial or residential real estate project, and it seems no area of the Valley is immune. And where there are older complexes, they are being bought for millions of dollars and renovated.

Local experts charged with buying and selling the properties told senior reporter Angela Gonzales this week that as long as rents are relatively low compared with the rest of the U.S., jobs keep expanding in the region and people keep moving here, there will be plenty of interest.

Vacancy rates around 5 percent show there's no shortage of new tenants for any apartments. As home prices rise, and challenges grow on that side of the market in terms of qualifying for loans and potential interest rate increases, renting likely will be a way of life for a lot of people.

With thousands of units in the development pipeline for 2019 and beyond, this trend likely won't be going away anytime soon.

Connect with Managing Editor Patrick O'Grady at pogrady@.

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PHOENIX BUSINESS JOURNAL

American City Business Journals - Not for commercial use

Charley Freericks, left, senior vice president of Catellus, and Brian Kearney, senior development manager for Catellus, overlook land that is part of the third phase of construction for Novus, which will fund new Arizona State University athletics facilities.

JIM POULIN | PHOENIX BUSINESS JOURNAL

JANUARY 25, 2019

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COVER STORY

ShapingUP ASU FACILITIES DISTRICT PROMISES ATHLETICS REVENUE, OFFICE POTENTIAL BY CORINA VANEK | cvanek@

American City Business Journals - Not for commercial use

Arizona State University-owned land may be the target of a lawsuit over diversion of property taxes, but its massive real estate development designed to fund ASU's athletics facilities is progressing forward unscathed.

Overall, the Novus corridor just east of Phoenix has nearly $1 billion worth of projects in the works, making it the largest single concentration of construction in the state, possibly in the Southwest, said Charley Freericks, senior vice president of Catellus, the project's master developer.

The corridor, which runs along the north and east side of ASU's Tempe campus, will add office space, hotel rooms, retail,

restaurants and residential developments into the Valley's hottest submarket. Already it has developed Marina Heights, the regional home to State Farm with more than 2 million square feet of office space.

Even as the Arizona Board of Regents works to defend a separate project on university-owned land, ASU officials see their way forward in protecting their Novus investment with a state law that gives universities the ability to develop athletic facilities districts. Instead of paying property taxes, those developments pay fees to ASU that ultimately will fund upgraded athletics facilities.

So far, Arizona Attorney General Mark Brnovich's lawsuit isn't targeting Novus. ASU's facilities district allows money that would be collected as property taxes to be received as in-lieu fees that support the university. That distinction could allow the project to fulfill the university's plan.

For ASU, the money gleaned from Novus is seen as a way to keep the university competitive in the increasingly expensive world of college athletics, where schools around the country are finding new ways to raise revenue.

Getting started Plans to allow private development on the 330 acres designated as ASU's athletic facilities district started "as a selfhelp tool" in the wake of diminishing state funding for universities following the Great Recession. The lack of money meant athletics often was among the first departments to see budget cuts.

"We realized quickly that was the tail wagging the dog," said Morgan Olsen, chief financial officer of ASU. "We've got 300 acres [to use] for largescale development."

In 2010, the Arizona Legislature gave universities the ability to create an athletic facilities district where private development could be built and, instead of property taxes, the developers would pay in-lieu fees to the university that would directly fund athletics.

RENDERING PROVIDED BY ASU

The next phase of Novus, on the west side of Rural Road south of Tempe Town Lake, will include office, residential and a food hall.

"The university realized the resources it would need to be competitive at the college level in the Pac-12, and it would be expensive to provide that type of environment," Olsen said. "You can argue right or wrong, but it is."

According to the law, the land had to be contiguous, and ASU chose property it determined was not needed for its "core mission" of educating

students, Olsen said. Funding athletic operations

through the district can help to relieve the burden from other university funding sources, which have been pinched by state funding cuts, Olsen said. The university anticipates the district will raise about $500 million over two decades, funds the law requires to go to the creation or main-

tenance of athletics facilities. In the most recent year, ASU ranked

No. 30 nationwide in terms of athletic revenue, pulling in $101 million, according to USA Today's most recent analysis. Tops in the U.S. is the University of Texas in Austin, which had revenue of $214 million during the 2016-17 school year. Adding an additional $50 million annually would greatly benefit ASU's athletics efforts and put it at the top of the Pac-12.

Grand plans At buildout, Novus will have 4 million square feet of office space, 670 hotel rooms and 300,000 square feet of retail, according to data from ASU. About half the development that takes place in the corridor will be office, according Freericks.

Novus is more than just a funding mechanism for athletics. It could put Arizona on the map for significant company relocations and large corporate headquarters, Olsen said.

While Arizona did not make the short list for Amazon's HQ2, "that opportunity is still there for another organization," Olsen said. "State Farm could have gone anywhere, and now those jobs are here. That is the model we are trying to put in place here. There are benefits to working with a

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