US Airways makes more plans for corporate campus - East Valley Tribune: Business

US Airways makes more plans for corporate campus

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Posted: Friday, February 24, 2006 6:05 am | Updated: 3:45 pm, Fri Oct 7, 2011.

Development at the US Airways headquarters in downtown Tempe is finally ready for takeoff. The carrier has chosen a development adviser that will help decide what should be built on the four acres where its nine-story building sits.

Current plans call for the addition of office, retail and parking space and could potentially include a hotel, restaurant, conference center and highrise residential condominiums.

The goal is to create a corporate campus that would allow the airline to grow while at the same time giving Tempe an anticipated high-density development that would increase sales taxes while blending with stores and offices on Mill Avenue.

The site near the southwest corner of Mill Avenue and Rio Salado Parkway is one of the most prominent properties in downtown Tempe.

A light-rail stop is under construction on its southeast corner.

“It’s a good time to complete the development of that site,” said Steve Corney, managing principal of the Staubach Co., the firm chosen by the airline to market the site. “America West Airlines had made a commitment to Tempe when they went on that site that would enable development on the rest of it and they’re living up to that commitment.”

America West and US Airways merged in September. In 1998, the city agreed to pay America West about $15 million over 20 years to build a new building and remain in Tempe.

As part of a development agreement, America West promised to develop the land.

Current plans call for the company to add an office tower that would be similar in size to the tombstoneshaped building that US Airways already occupies.

Also planned is 75,000 square feet of two-story restaurant, retail and office space along Mill.

But Corney said the makeup could change. Over the next several months Staubach will interview developers to determine the best use for the land.

“US Airways certainly wants to see a significant office component so I don’t think we’ll see anything less than a 200,000-square-foot office tower there,” he said.

Even with a the second office tower, there would still potentially be enough room for high-rise condos or a hotel, Corney said.

“The city would like to see maybe some conference center space,” he said. “We’ll just have to see what fits best on the site and what works, and, maybe more importantly, what we can park.”

It’s possible an existing parking structure south of the headquarters could be lengthened and/or additional decks could be added to the three-story structure, Corney said.

“We’re certainly not going to ignore parking,” he said. “The city of Tempe would love us to put as much parking as we can get on there for event parking.”

Because the deal to stay in Tempe was signed eight years ago, the carrier has been criticized by some at City Hall for moving too slow on the project.

According to the agreement, the project should have been completed by July 2005. Now the carrier has until 2008 to finish.

Last year, America West officials said they are waiting for the city to move forward on the redevelopment of the historic Hayden Flour Mill across the street.

Without that, airline officials said their project would fail because they need both sides of the street fully developed.

The City Council granted two extensions when it appeared the airline would miss key deadlines.

By pushing back the deadlines, the city saved the airline nearly $200,000 a year.

According to the development agreement, the city can impose a $175,000 penalty for failing to meet deadlines.

Corney said a lead developer will be selected over the next few months and construction is slated to begin in the first quarter of 2007.

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