Higher-income families spur business boom - East Valley Tribune: News

Higher-income families spur business boom

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Posted: Thursday, December 9, 2004 5:23 am | Updated: 4:54 pm, Thu Oct 6, 2011.

Part 6 of 6 Brant Simmons and his 10-year-old twin, Brock, tear through a South Gilbert Road parking lot with one aim in mind — Warzone Gaming.

Destination 85296 special report series

A pair of tennis shoes gripped in his left hand, the Brant screeches to a stop on his in-line skates and peels off his wheels while Brock dumps and locks his bike.

Then the brothers race through the doorway into an electronic world of dark alleyways and dizzying rooftops, battlefields and barricades, alien invaders and cartoon crime fighters. It’s a world dominated by dozens of 10- to 18-year-olds who are drawn inside by the tantalizing technology of Warzone Gaming’s 34 graphicsintensive computers and highdefinition projectors that can turn a blank wall into a realistic race course.

But it’s the kids who have drawn Warzone Gaming to a strip mall in Gilbert. With its original outlet in Tempe, Warzone Gaming expanded to Gilbert in May to capitalize on the young and technologically sophisticated population in one of the nation’s fastest growing ZIP codes.

Almost a third of Gilbert’s residents are younger than 18 with 10 percent of the town’s population younger than 5 years old. Average household incomes reach $94,000, homeowners make up almost 95 percent of residents and 52 percent of families here have two or more children.

This youthful, economically strong demographic promises a continued population boom. That means a lot of kids. And plenty of families with enough disposable income to buy more than a few hours worth of computer time at a place like Warzone Gaming.

Chris Bolton, Warzone Gaming’s co-owner, says the decision to open a store in Gilbert was based on specific criteria that he chooses not to share beyond the basics.

"We have a full package that we use to evaluate different areas, based on population, the average kids’ ages, average income as well as the distance of schools," Bolton says. "A lot of it is also the rent value and the rent cost."

Five years ago, this area bordered by Gilbert, Higley, Queen Creek and Elliot roads had a handful of privately held businesses tucked in between acres of alfalfa and hay fields and a few homesteads. You could drive for miles, from one end of the ZIP code to the other, and be hard-pressed to find a bookstore or a boutique, let alone a place to get a good glass of chardonnay.

That’s about to change, with more than 3 million square feet of retail space to be developed in the ZIP code.

Now, stores from SuperTarget to Wal-Mart Supercenter are in the works. Over the next three years, this part of Gilbert will see outdoor shopping and entertainment centers, the largest auto mall in Arizona and a new hospital whose signature tower looms over the intersection of Val Vista Drive and the now-under-construction Santan Freeway stretch of Loop 202.

Town leaders say the new corporate tenants will make sales tax receipts skyrocket. They predict sales tax revenue, estimated to be about $35.5 million this fiscal year, to reach $43.9 million next year and $49.4 million in fiscal 2006-07 when the new freeway comes through the region.

For the most part, business owners and developers are embracing the rapid growth, much of it generated by the new Santan Freeway. Development in this neighborhood means new customers with big incomes and large families. The freeway will provide easier access to residents and bring in customers from elsewhere in the Valley.

"Gilbert stacks up really well in terms of growth and income and families," says Scottsdale developer Buzz Gosnell, who is helping to create one of the area’s biggest commercial projects along the Santan Freeway expansion.

Gosnell says his company chose the region carefully and "spent a lot of time looking all over the Valley and other parts of the country."

"You’ve got to take into consideration who’s living there. People are younger, families are bigger and that filters into what you build there," he says.

ADAPTING TO CHANGE

A few miles south of Warzone Gaming is Ranchos Del Sol Feed and Seed. Owner Julia Rempel and her family have been catering to the horses, livestock and pets in this section of town since the 1970s, selling feed, medicine and accoutrements to animal owners from their store at the intersection of Gilbert and Ray roads.

The store is lined with bags of seed in all shapes and sizes, from canisters of loose sunflower seeds and alfalfa pellets to 80-pound bags of corn, oats and barley for horses and other livestock.

There are boxes of horseshoes, bottles of medicine for gastric upset and vitamins to encourage healthy growth. Fly mats — coverings for horses’ heads to keep out bothersome flies and prevent eye infections — are handmade by Rempel and her adult daughter, Denise Grayson.

"It’s hard to explain to people that flies don’t fly up," Grayson says, describing how the fly mats work even though they don’t zip tightly around a horse’s neck.

Ranchos Del Sol has been around for almost 30 years now and Rempel has witnessed the community’s change.

"We bought out in a rural area so it’d be rural and it’s not rural anymore, it’s downtown," Rempel says.

With the number of rooftops increasing all around her store and the size of lots shrinking, Rempel has tweaked her inventory to meet the changing needs of her customers.

"You have to carry more small animal items — for dogs and cats and birds. We sell quite a bit of birdseed," Rempel says.

Although fewer and fewer families own livestock anymore, Rempel is staying true to her roots and says decades of customer service pays off.

"We’ve got customers from all over. The word has been spread over the years and they tell their friends who are animal owners," she says. "We’ve got customers that come down from Heber and Payson to visit their kids or whatever and they buy their feed here because it’s cheaper than up there."

And despite — or perhaps because of — the encroaching development, Rempel plans to be at Ray and Gilbert roads for a long time.

"I’m not planning on moving," she says. "This has been a central location for me forever. And you can’t just up and move."

OUTSIDE INFLUENCES

Real estate magnate Bill Lund stands next to giant machinery on the hard dirt that will be his Santan MotorPlex, Arizona’s largest auto mall and one of the three largest in the country. The automall is part of his Spectrum at Val Vista development, a 1,470-acre master-planned community along Val Vista Drive and the Santan Freeway stretch of Loop 202.

Quiet and reserved, Lund has an impressive track record. In the 1950s, Lund spotted the possibilities on a patch of Florida ground covered by mangrove, swamp and scrub.

Working with other developers and Walt Disney, he helped put Disney World, Busch Gardens and Orlando, Fla., on the map.

And it’s likely his efforts here will do the same for the commercial face of Gilbert. With the project six years in the works, Lund says improvements will be finished by August. The first buildings will probably be started next year.

This fall, town leaders approved a package of incentives that will ultimately return $60 million in sales tax revenue generated from the site back to the auto mall. But with Gilbert’s dedicated sales tax of 1.5 percent collected on the sale of each car, the complex is expected to contribute millions to town coffers.

Five dealerships with six car brands have already committed to locating in the complex that could see its first car rolling off the lot by December of next year.

"It’s important to me to develop something that’s unique," Lund says later from the air-conditioned comfort of a nearby Subway. "I didn’t want run-of-the-mill shopping. I call them ‘me-too centers.’ I didn’t want to do that. If that’s all we could do, we would have sold it."

Detailed demographic studies of the area conducted for Lund show the region and its residents can support the large-scale businesses he’s developing.

"It takes a very unique set of demographics in the marketplace for that to occur and we have it here," he says, although he’s reluctant to reveal more specifics.

Two years ago, Lund met and recruited Buzz Gosnell, another power player in the development scene, having built Kierland Commons, the trendy and upscale shopping center on the Scottsdale border in north Phoenix.

In a 50-50 partnership with Lund, Gosnell is creating Gilbert’s own version of the pedestrianfriendly retail venue on 52 acres opposite the auto mall on the east side of Val Vista north of the Santan Freeway.

Ground isn’t expected to be broken until next year, but Gosnell’s corner office at Kierland Commons is full of materials related to the 540,000-square-foot project.

But Main Street Commons won’t be a cookie-cutter repeat of Kierland Commons, Gosnell says. Although no tenants have yet been announced, Gosnell says the outdoor center will have retailers targeted to the needs of Gilbert residents — affluent families with children.

The outdoor village will also feature restaurants, entertainment options and specialized activities — such as an Easter Day parade — that such a familyoriented community will find attractive, Gosnell says.

"Hopefully, Gilbert is going to be self-contained in terms of services," he says. "Because right now, on Friday night, they go someplace else."

FREEWAY FRENZY

The arrival of 6.1 miles of the Santan Freeway in this ZIP code, stretching from Gilbert to Higley roads, in summer of 2006 will create a booming mecca of retail centers, entertainment venues and restaurants such as the Santan MotorPlex, Main Street Commons, San Tan Village and Crossroads Towne Center.

Westcor, the West’s powerhouse builder and manager of shopping malls, is building San Tan Village, a 500-acre project that will include a traditional indoor mall, retail power centers, residential and office space south of Williams Field Road along the freeway.

While the mall is scheduled to open in 2007, about 1 million square feet of retail space is expected to open within a year.

Wal-Mart and Sam’s Club should be the first, opening next spring as part of a 44-acre power center. Next summer, Circuit City and Razmatazz are among retailers expected to open in an adjacent 29-acre power center.

Ultimately, San Tan Village is expected to house at least 2 million square feet of retail, entertainment and restaurant venues, including a multiplex Harkins Theatre, in both indoor and outdoor settings.

And Phoenix-based Vestar is building its Crossroads Towne Center development, a 1.3 millionsquare-foot shopping and entertainment project that straddles the Chandler-Gilbert border.

Retailers including SuperTarget, Ross Dress for Less, Linens-n-Things, Pier 1 Imports and Barnes & Noble are lined up to occupy part of the Gilbert portion of the project, which includes about 50 acres and sits on the east side of Gilbert Road on the north and south sides of Germann Road, south of the Santan Freeway. SuperTarget is now under construction and should be among the first retailers to open next spring.

Attracted by the highway’s easy access and the region’s affluent and young families, developers and businesses are clamoring to locate here, investing millions and contributing more than $14.4 million in additional sales tax revenue to the city over the next two years.

"A big reason we’re out here is the Santan Freeway," Gosnell says. "Once that comes, it turns into a whole different world."

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