Block 23
 

Here is a new thread for everything occuring on Block 23. :)

Renderings:

http://www.gannett-cdn.com/-mm-/53d2...-Rendering.jpg

http://downtownphoenixjournal.com/wp...-resized-2.jpg

https://arizonadailyindependent.com/...ctive-View.png

http://dtphx.org/wp-content/uploads/...1-1024x663.png

Thanks Obadno! Great enlarged pic! I haven’t seen it that way. More impressive!!!

Has it ever been determined if these are the final renderings or is it possible that they will go higher with the residential? With all the activity and demand downtown, you'd think at least 20 stories wouldn't be out of the question.

The rendering is of a ~20 story residential.

I found a massing diagram of a taller office section and I would guess thats the best we can hope for.

http://dtphx.org/wp-content/uploads/...nt-webcrop.png

As you can see from the diagram, the building is only about 15 stories but it has high ceilings. In the original (and from what we know probable) massing the building is only 4 floors but its as tall as the 9 story office building across the street because of its 15 foot ceilings. In this massing above its more like 15 stories with the equivalent height of a ~25 story office building for the same reason.

Im hoping, with the continued downtown demand and shrinking office vacancy, Red takes the risk of developing a larger office building. Considering they finished citiscape in 2009 during the depression, they might see the stronger economic forecast and take a risk on this.

http://i.imgur.com/CISivb8.jpg
http://i.imgur.com/zTGpfBx.jpg

Anyone remember when CityScape was new, and they built a temporary sales office? It was located where the dirt has been removed in the second picture that fawd took.

Bit of a delay because they found an old foundation on the site and are preserving it for photographs prior to proceeding.

https://i.imgur.com/NEJZIwI.jpg

There was an article that came out when Fry's was first proposed about a Cold War era bomb shelter beneath the lot and the excavation to be done. Prior to that, who knows what else is down there. Fox Theater (still ducking pissed it was demolished) was on that exact corner. And before that it was our very Victorian city hall. I'm curious what else they'll find.

Also, will depending on how deep they dig be telling of how tall the office portion of the project will be?

I work in Colliers Center and walk by here daily and they are definitely doing an archeological dig. They were using a pick and a brush yesterday uncovering a brick wall.

That'd be cool if there's a section in either Fry's or a small space dedicated to the history of the block. There's so much history on the block (relative to Phx I mean).

Downtown Class A vacancy is still high but your point about taking a risk is a good one because the kind of office they are planning to develop on Block 23 is more creative space rather than traditional office space located downtown. I suspect they'll land some pretty top tier tenants for hip factor alone.

It's going to be nice to see that nasty parking lot disappear forever. I gotta say that this project has really grown on me. At first, I wasn't happy with the height but it's going to have an awesome street presence if built like what we see in the renderings with the buildings spanning across the whole lot like that. Much nicer than cityscape.

The larger massing was shown to the City to show that the office portion is being built to sustain future height.

This is essentially a 20-story residential tower with a block-wide podium; even that tower is unattractive given how wide it is.

The worst part is the ground floor plan, though. 90% of 1st St and Jefferson will be dead walls from the Fry's, where shallow retail bays could have been placed to integrate it and make it, well, urban. The space along Jefferson and 2nd st for residential amenities is also out of place with Colliers and TSA next door.

Tonight Fox 10 News at 9 is doing a story tonight on the artifacts found so far during the archeology dig so far.

Fry’s in Downtown Phoenix breaking ground in April
 

:cheers::cheers:

With a new very moody rendering:

http://azbigmedia.com/wp-content/upl...apartments.jpg

By far my most hated vacant lot in Phoenix. That rendering looks bad ass! :cheers:

Agreed, looks great! Wish the office portion was higher, but I get that the demand is just not there...yet. Hopefully in the future or even during construction phase, office demands skyrockets and RED decides to go higher

I'm sure it will happen sooner than later. Someone has to be taking notice of the influx of residents by now and probably have office space in mind.

For anyone who wanted an update on the archaeological dig occuring at Block 23:

http://www.azfamily.com/story/350381...autostart=true

Interesting stuff...

So this is interesting: http://azbex.com/minor-amendment-rev...-for-block-23/

Maybe an office tower isn't completely out of the question just yet, or maybe im just being overly optimistic.

I think the office tower was always part of the bigger project and was going to be built at some point. Maybe a possible tenant(s) has been found?

Maybe they have realized the apartment market is over-saturated and don't know if they necessarily want to build them.

The lack of a mention of apartments in what the deal will require bit is slightly unnerving. Or maybe that's post jitters from the Derby axing. Besides the Fry's, that's the biggest part of this project and I'd hate to see it either scaled down.

I don't necessarily think it's jitters from Derby but I do think there's a realization that we have a metric ton of apartments in the area and each one is a carbon copy of the next. Same price points, same kinds of finishes, the competition between them will be immense and I think the initial excitement blinded a lot of developers.

I don't mean this to sound insulting to anyone it's more just a "hey did you know?" type of comment. People building these apartment buildings have no interest in owning them long term and running them, they're just developers looking to cash out and sell to a REIT. If they think the product will be hard to sell in a year or two years, they aren't going to build it and I think we are getting to that point right now within this high end market. There's money to be made in the lower end products that everyone is overlooking but the land cost and construction cost at this location is too high to make any low end product pencil.

I disagree. Not that these are flipped to REITS and that much of the same product is available, those are all valid points. I disagree because I believe RED just flipped the CityScape apartments for a record sale. Sure, the market could become saturated, but they just got record prices. Values on a new project could in theory drop, but it won't be much in that time period.

Also, the supply of apartments in general is rapidly increasing, but the supply of high-rise apartments is still very limited. You only have CityScape and 44 Monroe. Sure maybe The Stewart will pan out, maybe One Central Park East will pan out, but supply of high-rise apartments is not near saturation levels and still command a premium, as evidenced by the sale of city scape apartments.

Bingo. The appeal of a view has been underestimated by developers IMO.

This is a big thing for me, personally. The only way I'd move downtown would be into a high rise with a great view. I've been hoping for a few years that there'll be more choices. If I'm going to give up the large space of a home, then in exchange I want to be able to have the feeling of bringing some of the outdoors into my apartment or condo-if that makes sense.

http://www.phoenixnewtimes.com/arts/...hoenix-9219082

"The Fry’s footprint on the ground floor will be about 200,000 square feet, and the office space is being built above it, which means the developer will include 50,000 more feet of office space than first planned."

Didn't think they'd be altering the development to reduce the apartment phase.

"But the City’s investment could pay off big time, according to financial impact numbers calculated by its department of economic and community development. Those calculations indicate that Block 23 will likely generate $76.5 million in sales tax revenue during the course of its 50-year agreement with the City."

This is why the people that bitch about GPLET's piss me off. They don't comprehend the bigger picture and think that everything is 'unfair'

While New Times is hardly the source I go to for news, this is both believable and exciting. Can't wait for this to start going vertical.

How many more floors is that?:cheers:

The argument that a development will generate sales tax as a consolation for not generating property tax is not a proper justification.

Sales taxes and property taxes are not apples to apples comparisons in the following respects:

• First, property taxes generally go to pay for specific city resources such as a specific fire department or a specific school, while sales taxes just go into the general state and city budgets without necessarily being allocated. For example, the property taxes I pay on my house go directly to the elementary school up the street and the fire department that responds to my house. Sales taxes have no similar allocation.

• Second, property taxes are not paid at a standard rate like sales taxes. Property taxes are a zero sum game. The tax assessment is "backed into" every year based on that taxing jurisdiction's budget. When one property is taken off the property tax roll (i.e. The Derby) due to a GPLET, all of the other property owners in that taxing jurisdiction must make up the difference (i.e. Angel's Trumpet). This means their taxes go up dollar for dollar to make up for the GPLET. Again, it's a zero sum game. This is obviously very different from sales taxes. The amount of sales tax collected by "business A" (i.e. The Derby) has zero effect on how much "business B" (i.e. Angel's Trumpet) must collect.

I'm not a big supporter of the Goldwater Institute, nor do I have a strong opinion on any of these specific GPLET issues. I just want people to understand how these tax incentives work and make arguments for or against based on sound logic and analyses.

Very good points, Nick.

Good news, groundbreaking next week with all components on track !


http://www.bizjournals.com/phoenix/n...-downtown.html

Your taxes go to Mesa USD, not to a specific school. Some GPLET situations, like Derby, have made deals with the school districts to make up for lost funds.

A positive note about GPLET is that it might help something get built. if nothing gets built, the property owners are going to pay more tax as budgets increase.

I think of the property at mcdowell and central that sat vacant for over 25 years not providing property or sales taxes.

I think don't like the GPLET because of the length of the GPLET. 10 years would be more reasonable.

As downtown becomes more popular maybe the GPLETs can go away.

Not so simple as good or bad.

That actually was one of the main purposes for the legislature's recent amendment to the GPLET law--I believe they shortened the period to 8 years.

Yes that's correct- my property taxes go to my school district, as opposed to sales taxes that go to a general state or city budget that can be used for anything. We're all familiar with how the AZ legislature has drastically cut funding to education, resulting in an even higher reliance on property taxes. GPLETs exacerbate this problem.

Here's a good analysis:

Also keep in mind that even if the Derby has made a deal with a school district, other resources are still getting short-changed (i.e. fire department, police, road constructions, etc.) meaning property owners still have to make up that difference.

Property owners still pay property taxes on vacant land. However, the taxes are obviously lower given that the property value is lower. This, however, is rational in that vacant land requires fewer public resources (i.e. no fires, no kids needing school, no road wear and tear). However, once a building goes up, the local government needs to provide additional resources for those new residents, necessitating higher property taxes on that parcel.

Anyway, stating that "the land didn't produce tax revenue before" is a weak argument that, even if true, would encourage antisocial behavior by rewarding bad actors (vacant land bankers) by giving them a government handout (property tax breaks) to develop the land.

I agree. I am generally in favor of governments being able to use tax incentives to drive policies, and I don't necessarily want GPLETs to go away. Rather, I think a GPLET program with a shorter time period would be more appropriate.

In the alternative, a better policy might be to raise property taxes on vacant land. This will provide the same incentive to develop without having to give a handout to those landowners and developers. It will also give a break to nearby residents in that they won't have to shoulder the additional costs of city services that arise from a GPLET.

Some jurisdictions have tried this (i.e. Houston), and as far as I can tell, it has worked to encourage development and discourage land bankers.

Wait. What has changed in terms of the office space? 50,000 square feet is easily fit into the 3 originally planned floors.

A massive 200K big box is just not appropriate for downtown. Look at the CVS windows at CityScape and imagine those running 3/4 the length of 1st Street... how... urban. Every grocer in big cities hides these walls with shallow retail.

I also don't get why RED hates Jefferson. A 3rd consecutive block of loading docks and garage ramps planned.

Without the residential tower, this is a total miss. I actually think the renderings look great; but, that's if I pretend 1st Street, 2nd Street, and Washington have much more active ground floors than they do, and with the hope that one day, a hotel tower will rise on 1st St/Washington.

I stand corrected then. This still does not make sense to me though. If you are RED, and you don't have enough confidence to building housing above downtown's first grocery store, then how would you have confidence that the store would survive? Especially with such little housing in the area? In addition, as mentioned, they sold cityScape Apartments for a record deal.

If you don't take advantages of one of the few places residents can be added in the immediate area to support your Fry's store, it's a bad investment to build the project. Fry's will cancel their lease within two years and nobody will lease a space like that downtown. Yes, I'm sure they built in heavy penalties for terminating the lease early but it won't be enough to make the project profitable. Stupid. Stupid. Stupid. Idiots.

I no longer support this project. Would rather see something on the scale of what's proposed in Tempe in the Roosevelt area.

BTW - I'm quite sure that Tempe project will not happen. Whole Foods is struggling mightily and is for sale.

RED won't be operating the super market. It will be Fry's. It doesn't matter whether RED has "confidence that the store [will] survive." All RED needs to have confidence in is whether the building is leased, and I believe Fry's has already entered into a long-term lease.

Of course. But I'm sure there is a clause in the lease that Fry's would have to pay a significant amount to cancel the lease. Having said that, it's not enough to justify the building expense if Fry's closes that store. So you cannot look at it exclusively that way. Yes, RED would likely be protected for a couple years by the penalty, but that doesn't cover the long-term expense of a space that is only usable for a grocery store or big box.

Since when was this project lacking the apartments the article from last week said it's a go and it's increasitng the size of the office space

I don't think he said RED would be operating the supermarket, I think he said that he doesn't think Fry's will do well enough to stay open with no residents to support it. Be honest here, do you think two apartment buildings within a couple of blocks and a few hotels are enough to keep this place open outside of office hours? Not a chance.

No one can make Fry's honor their entire lease term, they may have signed a very long term lease but if they stop paying the rent and move out (or get locked out) then RED will have to attempt to pursue them for lost rents and it will go to a judge. Having 300 apartments on top of it doesn't make or break Fry's but it definitely makes it easier...

I deal with leases every day of my life, I promise you having a lease signed with Fry's provides ZERO security the store will be there any certain amount of time. And the poster above me is correct, that space will be very, very difficult to lease again.

"Until recently, plans approved by the City call for Block 23 included the following:

• 50,000 square feet of commercial space, to include a grocery store
• About 300 high-rise residential units (RED puts that number at 330 now)
• 150,000 square feet of office space for technology- and innovation-focused tenants
• 1,000 parking spaces located above and below ground

But on April 5, the Phoenix City Council approved changes requested by the developer to allow for “greater market flexibility.” Now, development plans call for at least two of the following uses: office, commercial, or residential — instead of all three. And possible use for a hotel is specifically excluded. The new specifics look like this:

• At least 50,000 square feet of grocery store space.
• At least 150,000 square feet of office space
• Approximately 1,000 above and below ground parking spaces.

The most obvious change is removing the requirement that the project include residential units. But plans to include the grocery store remain.

“The project details in the city ordinance are a minimum requirement for the development,” Moloznik says. “The project will include a 55,000-square-foot grocery store and 200,000 square feet of office restaurant, retail.”"

- http://www.phoenixnewtimes.com/arts/...hoenix-9219082

I still do not necessarily think this means the apartments are canned, it just means RED is smart enough to be aware the apartments may be a bad idea and want to put themselves in the best position should they choose not to build them.

Anyone who gets news from the Phoenix News Times needs to get their heads checked. Seriously.


Here are the FACTS in the Section 201.1 amendment:

1) Project is still described as a 'Mixed-use high-rise development project'
2) The Project still has a projected total gross square footage of approximately 500,000 square feet, NOT including parking.
3) Minimum square footage for grocery: 50,000
4) Minimum square footage for office: 150,000


Let's all put on our thinking caps here:

50,000 + 150,000 = 200,000

Which leaves 300,000 square feet.

Lets all put our thinking caps on and understand that simple math does not indicate the uses of the square footage we are adding together.

Also, lets try not to be a little nicer to each other. :tup: Your tone was not missed.

This new article from DPJ today references the 330 apartments. I guess we'll just have to wait and see in the next day or so. It breaks ground on the 13th and I'm sure more updates will be provided by local media coverage.

http://downtownphoenixjournal.com/20...-break-ground/

Guys.......... the Block 23 development 100% still includes the residential tower.

Literally talked with Moloznik (VP of RED) this morning.




DT Phoenix can definitely still support more residential units - we're not even close.