Quarterly Report Fiscal Year 2011-2012 2nd Quarter 2nd... · Quarterly Report Fiscal Year 2011-2012...

City of Chandler

Economic Development Division

Quarterly Report Fiscal Year 2011-2012 2nd Quarter

INDEX

Table of Contents INTRODUCTION .............................................................................................. 3

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

ECONOMIC TRENDS ..................................................................................... 7

RETAIL ............................................................................................................. 9

INDUSTRIAL/OFFICE DEVELOPMENT ....................................................... 12

TOURISM ........................................................................................................ 16

DOWNTOWN ................................................................................................. 19

2 Economic Development Division June 2, 2014

INTRODUCTION

Economic development activity continued on a positive trend during the second quarter. For the quarter ending December 31, 2011, Economic Development staffs combined efforts identified 4,779 leads, and 20 prospects, representing an estimated 705 jobs, occupying approximately 322,932 square feet of space and $9.3 million in capital investments. 2nd Quarter Combined Efforts

Retail Industrial/Office Tourism Total Leads 13 32 4,734 4,779 Prospects 9 11 20 Jobs 95 610 705 Square Footage 85,435 237,497 322,932 Capital Investment

$9,320,220 $9,320,220

Retail: During the second 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 clients by keeping track of when the construction permits are reviewed and issued. Industrial/Office: During the second 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 missions, 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 Q2, Industrial/Office staff participated in the following activities: Activity Location Date GPEC NY Sales Mission New York, NY October 9-10, 2012 NBAA Trade Show Orlando, FL October 28 - November 2, 2012 TechEDge Chandler, AZ December 12,2012 Tourism: Tourism staff conducted the following trade and media activities for Q2: Activity Location Date Tourism Stakeholders Meeting Chandler, AZ September 25, 2012 Arizona Showcase and Hermosillo Media Mission Hermosillo, Sonora October 1-5, 2012

AAA Grand Canyon Railway Pre-FAM

Chandler and Tempe, AZ October 23-24, 2012


INTRODUCTION A tourism trade and media activity continues… Activity Location Date Sunny Arizona Sales Mission Greater Minneapolis, MN November 4-9, 2012 Sonora Media FAM Chandler and Tempe, AZ November 9-11, 2012 AOT Arizona Media Marketplace Scottsdale, AZ November 15, 2012

Tourism Stakeholders Meeting Chandler, AZ December 7, 2012

Sunny Arizona Sales Mission Greater El Paso, TX and New Mexico December 9-14, 2012

In addition to trade and media activities and travel, staff operates the City of Chandler Local Bites; a unique list of restaurants that supports Chandler’s one-of-a-kind dining experiences whether they are independently owned or extraordinarily unique in the market. Downtown: Economic Development Downtown Redevelopment staff continues to work with the merchants to collaborate in advertising and promoting business in 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.

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

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 and it is essential to the City of Chandler’s estimated population of 238,451 citizens and approximated 95,336 housing units located in the City’s borders as of December 1, 2011. Economic Development personnel continually update economic data, and 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 and specific gaps, in targeting retail markets and linkages to key census information, which assists in presenting available sites.


10

110

210

310

410

510

610

Q1Q2

200

95

223

610

Jobs Created FY 11-12

Retail Jobs

Industrial/Office Jobs

0

50,000

100,000

150,000

200,000

250,000

Q1Q2

99,866

85,435 51,179

237,497

Square Footage FY 11-12

Retail S.F.Industrial/Office S.F.

ECONOMIC DEVELOPMENT OUTLOOK The economic vitality of the City of Chandler relies on job growth and demographic factors.

The influx of educated workers, sustainable increases in population, high education choices and a pro-business record, lay the groundwork for healthy job creation and employment opportunities during the first quarter.

Source: City of Chandler Planning Division December 2011

Population Growth

Q1 Population 237,776 237,926 238,041

Jul. Aug. Sep.

Q2 Population 238,199 238,319 238,451

Oct. Nov. Dec.


Source: City of Chandler, Sales Tax

ECONOMIC TRENDS According to the Arizona Department of Commerce, by the end of Q2, the City of Chandler’s average unemployment rate is 6.6% while the City of Phoenix has an 8.3% unemployment rate and the state of Arizona has an 8.9% unemployment rate.

July Aug Sep Oct Nov Dec

Q1 Q2

1st & 2nd Quarter Unemployment Rate FY 11-12

Arizona

Phoenix

Chandler

Source: Arizona Department of Commerce Source: Arizona Department of Commerce

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


Employment By Occupation FY 11-12

Service Occupation

Farming, Forestry and Fishing

Managerial and Professional Service

Production, Transport, Material Moving

Technical Sales-Administrative Support

Construction, Extraction, Maintenance

Source: Claritas

ECONOMIC TRENDS

During the first quarter, the number of employed citizens reflects a slight decrease for the City of Chandler. According to the Arizona Department of Commerce, in this quarter, the City of Chandler gained an average of 1,247 jobs to its 122,047 total from the previous quarter; a 1.01% increase.

Q2 Oct. 123,063

Q2 Nov. 123,392

Q2 Dec. 123,426

Chandler's Employment Numbers FY 11-12

Source: Arizona Department of Commerce

121,512

121,817

122,812

123,063

123,392

123,426

2,720,808

2,728,413

2,749,336

2,753,020

2,757,712

2,750,082

5,000 50,000 500,000 5,000,000

Jul

Aug

Sep

Oct

Nov

Dec

Q1

Q2

Employment Comparison: Chandler vs. Arizona

FY 11-12

Arizona

Chandler


RETAIL Economic Development Retail staff located six new companies that included three restaurants, two health/fitness clubs and one prep school to the City of Chandler.

Specific Q2 Retail Activities:

1. Rudy’s BBQ Rudy’s BBQ’s history began just north of San Antonio, TX in the small community of Leon Springs where in the 1800’s Rudolph Aue opened a one-stop gas station, garage, and grocery store. Then, in 1989, Bar-B-Q was added to the operation and Rudy’s "Country Store" and Bar-B-Q has been serving up tasty food ever since. The same original recipes that built Rudy's Leon Springs' reputation are now available throughout the Southwest. Although many recognize the big large red building that is visible near 54th Street, the Chandler location is the first of its kind in the entire state of Arizona.

2. Five Guys Burgers Five Guys Burgers opened their first location in Arlington, VA in 1986. Five years later in 2001 Five Guys Burgers opened five locations around the D.C. metro-area and perfected their business of making burgers, leading to a cult-like following. In 2003, the decision was made to start to franchise in Virginia and Maryland. Within 18 months, they sold out of franchise territory and they started to open to the rest of the country for franchise rights. To date, Five Guys Burgers has over 1,000 locations in 47 states and six Canadian Provinces and over 1500 units in development.

3. Ahwatukee Foothills Prep School (Reuse)

Ahwatukee Foothills Prep School curriculum combines the rigor of classical education with the relevance required by contemporary society. Students

Q 1 Q 2

Retail Leads & Prospects FY 11-12

Prospects

Leads


RETAIL

learn about character, ethics, empathy and self-esteem implicitly by studying the world’s great heroes, both canonical and unsung, and by stepping into the Hoes of great historical figures, both real and imaginary. Paragon looks to the past to prepare students to become the architects of tomorrow.

4. You Fit You Fit is a health club, gym and fitness center founded on the principle of simplicity. You Fit offers friendly staff and equipment that keeps you entertained since all of their cardio machines have individual TV’s and Ipod connectors to watch and listen to what motivates YOU. In addition, You Fit has an inviting and clean environment without the pressure of sales pitch. You Fit strides to take away all the excuses of why not, while providing a place where customers fit in.

5. Can’t Stop Smokin BBQ Can’t Stop Smokin BBQ brings its New Mexico style smokehouse to the southwest in Chandler, Arizona. This family-owned business will feature a 20-foot hotline counter that displays up to 25 kinds of smoked barbecued meats, including beef, pork, chicken and turkey. The more than 5,000-square-foot restaurant replaces a former Village Inn outfitted with a log cabin look that seats 180 people.

6. Planet Fitness Planet Fitness creates a unique energetic environment in which everyone can be comfortable and feels accepted, safe and respected. The goal is to have a diverse, judgment free zone, where a lasting, active lifestyle can be built. Their product is a tool that can be used by anyone. Planet Fitness members can relax, get in shape, and have fun in a hassle free environment with the latest equipment and friendly staff ready to guide their members to reach their individual goals.

Reta

il

NAME LOCATION JOBS S.F. 1st Quarter Locates

Culver's Loop 101 & Ray Road 20 3,000 Arco AM/PM Arizona Ave & Chandler Blvd 5 3,000 Wendy's Arizona Ave & Ocotillo Rd 10 4,000 MVP Zone Gilbert Rd & Germann Rd 2 15,000 The Sushi Room Dobson Rd & Queen Creek Rd 10 2,231 Uno Stop Laundromat Arizona Ave & Galveston Rd 2 6,400 Hobby Lobby Loop 101 & Chandler Blvd 120 55,175 Freddy's Frozen Custard Loop 101 & Frye Rd 7 4,098 Jimmy Johns Loop 101 & Chandler Blvd 20 2,200


RETAIL

Economic Development and job creation accompany one another and job creation offers ways to advance the economic security of the city’s population.

Staff efforts in this quarter produced a combined 295 new jobs and occupied 185,301 square feet of retail space.

Reta

il NAME LOCATION JOBS S.F.

2nd Quarter Locates Rudy's BBQ 54th Street & Chandler Blvd 20 7,297 Fire Guys Burgers Loop 101 & Chandler Blvd 20 1,355 Ahwatukee Foothills Prep School (Reuse) Kyrene Rd & Ray Rd 25 36,743

You Fit Alma School & Chandler Heights 10 18,102 Can't Stop Smokin BBQ 54th Street & Chandler Blvd 10 500 Planet Fitness Arizona Ave & Loop 202 10 16,938

Q1 Q2

Retail Total Square Feet FY 11-12


200

95

Q1 Q2

Retail Total Jobs Created FY 11-12

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

Specific Q2 Industrial/Office Activities:

1. Ports America Ports America is one of the largest employers of maritime labor in North America headquartered in New Jersey, providing terminal management and a full suite of stevedoring (a stevedore is one who works in the loading or unloading of ships) and related services. Ports America moved its shared services operation, which houses the IT, accounting-related services and other company support functions to three floors of the former City of Chandler City Hall building in Downtown Chandler. Ports America has more than 85 years of experience operating American seaports. Its current business includes more than 80 terminals in 42 ports in North America, handling containers, roll on/roll off cargo, general cargo and cruise line passengers.

2. Garmin (Expansion) Garmin Global Positioning System (GPS) is a satellite-based navigation system made up of a network of 24 satellites placed into orbit by the U.S. Department of Defense. GPS was originally intended for military applications, but in the 1980s, the government made the system available for civilian use. GPS works in any weather conditions, anywhere in the world, 24 hours a day.

Q 1 Q 2

Industrial & Office Leads & Prospects FY 11-12

Prospects

Leads


INDUSTRIAL & OFFICE

There are no subscription fees or setup charges to use GPS. Garmin’s northeast Chandler location houses IT support and sales.

3. Infinity Trading Solutions Scott Tinker and Ryan Kohnke founded Infinity Trading Solutions (ITS) in 2002. ITS began with a mission to be the leading supplier of Commercial Aircraft Spares. ITS Infinity Trading has been providing aftermarket spares in the Commercial Aviation Industry for over a decade. As one of the fastest-growing companies in the industry, they have built a reputation for exceptional customer service, forward-thinking and rapid response time. Their 60,000 square foot warehouse features inventory of nearly 50,000 line items of Rotable and Expendable parts, acquired through aircraft dismantlement, consignment partnerships, and routine package/spec purchases.

4. TransPac Aviation Academy TransPac Aviation Academy has graduated over 4,500 pilots since 1999, many of whom are currently employed by the largest airlines in the world. With over 400 students on campus flying 87,000+ flight training hours a year, we are one of the largest flight schools in the world. This volume of training has allowed us to perfect our training syllabus and instructional techniques. We employ a student management structure that includes dedicated class managers and a low student-to-instructor ratio that ensures each student receives the individual attention they deserve. TransPac Aviation’s new additional primary flight training center is located at the Chandler Municipal Airport.

5. Phoenix Packaging Phoenix Packaging Operations LLC, which is a subsidiary of Grupo Phoenix, which is based in Bogota, Colombia, exports its products throughout the U.S. and to more than 30 other countries. Phoenix Packaging will manufacture injection-molded plastic packaging and related products at their new location in Chandler Arizona.

Indu

stri

al/O

ffice

NAME LOCATION JOBS S.F. CAPITAL INVESTMENT

1st Quarter Locates National Association Sports Medicine Santan Fwy & Cooper 40 14,300 $715,000

Soilsworks (Retention) Santan Fwy & Cooper 53 10,708 $525,000

Levementum (Expansion) Downtown Chandler 40 10,500 $375,500 Dunkin Donuts (Commercial) McClintock & Chandler 30 500 $900,500


INDUSTRIAL & OFFICE

Indu

stri

al/O

ffice

NAME LOCATION JOBS S.F. CAPITAL

INVESTMENT 2nd Quarter Locates

Ports America Downtown Chandler 200 66,000 $6,500,000 Garmin (Expansion) Juniper & Galveston 30 6,625 $298,000 International Trading Systems Arizona & Elliot 170 57,026 $1,372,220 Transpac Aviation Academy Ryan & McQueen 10 3,846 $150,000 Phoenix Packaging Arizona & McQueen 200 10,400 $104,000

The City of Chandler Economic Development staff efforts in this quarter produced 610 new jobs and occupied 236,386 square feet of industrial and office space, in addition to a projected capital investment of $9.3 million.

223

610

0

100

200

300

400

500

600

700


INDUSTRIAL & OFFICE

Economic Development Industrial and Office staff first and second quarter combined efforts created a projected 12.1 million in capital investment.

Q1 Q2

$2,516,000

$9,320,220

Capital Investment FY 11-12

51,179

237,497

Q1 Q20

50,000

100,000

150,000

200,000

250,000

Industrial/Office Total Sqare Feet FY 11-12


TOURISM Chandler experienced strong hotel occupancy and positive growth in the Average Daily Rate (ADR). It is believed that the construction related to Intel’s FAB 42 is driving occupancy. Tourism staff was active in a number of events this quarter including Arizona Showcase in Hermosillo, Sonora Mexico, which attracted more than 800 consumers and featured Chandler Fashion Center as one of the feature Arizona shopping malls. This quarter, staff also met with a number of journalists to promote the Sunny Arizona regional media FAM that focused on family travel. Tourism staff also worked with the Tempe Tourism Office and Mesa Convention and Visitors Bureau to finalize a pocket-size regional, family guide highlighting family-friendly activities, attractions, and dining in each respective communities. Smith Travel Research, Inc. (STR) has developed the specific Q2 Chandler and metro Phoenix hotel industry occupancy, average daily rate (ADR), and revenue per available room (RevPar) as a custom set for the Chandler market that are represented in the charts below:

10.0%

30.0%

50.0%

70.0%

Q1 Q2

Chandler Hotel Occupancy Rate FY 11-12


INDUSTRIAL & OFFICE

Metro Phoenix Comparison (FY 11-12)

Q1 Q2

Occupancy 58.4% 62.9% Occupancy 48.3% 55.2% Average Daily Rate $77.16 $88.61

Chandler Average Daily Rate $81.79 $102.28

Metro Phoenix

Revenue per available room $45.06 $55.90 Revenue per available room $39.49 $56.69

10%

30%

50%

70%

90%

110%

Q1 Q2

$77.16 $88.61

Chandler Hotel ADR FY 11-12

10%

30%

50%

70%

90%

110%

Q1 Q2

$45.06 $55.90

Chandler Hotel RevPar FY 11-12


INDUSTRIAL & OFFICE

Tourism staff generated a combined 6,788 leads by the end of this quarter. In addition, tourism staff also maintains the tourism website, www.visitchandler.com that is featured in each advertisement, brochure and press release and utilized at trade shows. Staff works with the Chandler Local Bites website, which is a guide to unique and local Chandler eateries & drinks for residents looking for great places to eat or take visitors. Additional information can be obtained on the website, www.Chandlerlocalbites.com or at select locations, local restaurants, hotels, City facilities, and visitor’s bureaus.

Q1 Q2


http://www.visitchandler.com/

http://www.chandlerlocalbites.com/

DOWNTOWN The role of Downtown Redevelopment staff was significant, in the various projects, activities and events outlined below throughout the first quarter.

Specific Q2 Downtown Activities:

Awards and Presentations:

The City of Chandler Downtown Redevelopment efforts received won three awards for Arizona Avenue Improvements:

• The International Downtown Association Award of Merit

• The Valley Forward Award of Merit

• The ENR Southwest Award of Merit

In addition to the previously mentioned awards, Downtown Chandler received the Valley Forward Crescordia Award for Downtown Revitalization Strategy.

Downtown staff was a presenter at the National League of Cities on Downtown Redevelopment strategies in the second quarter.

Façade Grants

Downtown Redevelopment staff and City Management had further discussions regarding façade grant issues. Staff looks forward to further direction from City Management with the goal of January 2012 Council approval.

Tenant Activities

Downtown Redevelopment staff spoke with four potential tenants seeking retail, restaurant, or office spaces in the downtown area.

In Q2, Downtown Redevelopment staff located two new tenants who opened for business.

• Ports America is one of the largest employers of maritime labor in North America headquartered in New Jersey, providing terminal management and a full suite of stevedoring (a stevedore is one who works in the loading or unloading of ships) and related services.

• Vintage 95 food and beverage program consists of contemporary American with a twist on the classics. Their wine selection is well balanced between boutique-styled wines, New World favorites, and Old World classics.

Sadly, two tenants closed their business in Q2:

• Ray’s NY Deli

• Cloud Nine Karaoke


DOWNTOWN

In Q2 Downtown Redevelopment staff managed the following downtown projects and provided the following updates: • Trash – Trash pilot service continues. Adjustments are made as needed

however; it is scheduled for reevaluation in early 2012.

• EMSD: o MOU created for building outlines. o Mural installed on bathroom walls at AJ Chandler Park. o Staff began discussion regarding needed contract revisions for FY2012-

13. o Staff clarified the bidding and procurement policies that apply to the

EMSD.

• Signage: o DCCP Board voted to contribute to a revised sign package. o Staff finalized the bidding, construction, and use of the AZ Avenue

Signage Package. o Staff requested the designer construction drawings. Staffs goal is to

start bid in early 2012.

• San Marcos Golf Resort - The San Marcos Golf Resort hotel has been returned to the bank. The bank will resell the property.

• Reuse of Blue Peacock - RFP drafted and submitted for review for market-based reuse. Six groups have toured the space.

• ARTyard - RFP cancelled and media requests handled.

• NW Quadrant Analysis - The project to develop a more detailed plan for the area outlined for future growth has been cancelled.

• Oregon Colonnade - Work on the Oregon Colonnade (SE corner of Boston and Oregon) began. The estimated completion period is scheduled for mid-to-late November 2011.

• Maintenance Activities: o Multiple lighting issues were resolved. o Dead ash trees are being removed and replaced.

• Website Revision – Staff continues to work on re-vamping Economic Development Downtown web pages. Draft pages are under review.


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