Leveraging P3 s. Christine Mackay City of Phoenix Community and Economic Development Director

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1 Leveraging P3 s Christine Mackay City of Phoenix Community and Economic Development Director

2 What is a Public Private Partnership? What is a P3? A globally recognized method by which to partner the private sector, government, and capital markets to get projects that benefit the public built more quickly Design, build, finance, operations, and/or maintenance partnership Legislation in Arizona is prime for P3 model A P3 is not privatization, a funding solution, a low-quality delivery model, or the right solution for every project

3 What is a Public Private Partnership? Possible P3 projects include: Development Agreements By RFP or by means of soliciting public assistance Encourage Redevelopment Land Development Job Creation Government Owned Land and Buildings Historic Preservation Environmentally Challenged Sites Infrastructure Projects Light Rail Toll Roads Streets and Bridges Water & Sewer Plants Public Buildings Airport Terminals and Improvements Amphitheater Business Park Incubator University Dorms Parking Garage

4 Development Agreements

Development Agreements From Request for Proposals Central Station

Request for Proposal issued Through public process recommended

Development Agreement Transit office incorporated Accommodate bus

5 Development Agreements From Request for Proposals Central Station City owned property Partial funding by Federal Transit Authority Request for Proposal issued Through public process recommended proposer selected Terms are negotiated and documented in a Development Agreement Transit office incorporated Accommodate bus service Public Parking Ground floor activation Enhance LRT Public participation on several fronts

7 Development Agreements From Request for Proposals

project doesn t pencil Downtown RFP submitted Terms are negotiated

8 Development Agreements Request for City Assistance CA Ventures The Link Privately owned property Downtown Core priorities Preferred project doesn t pencil Downtown RFP submitted Terms are negotiated and documented in a Development Agreement Public participation on GPLET

9 Land Redevelopment

NAU, ASU, TGen, IGC, NIH, Bioscience High & more 6

10 Government Owned Land 30-acres in Downtown Phoenix $1.3 billion annual economic impact Tenants include UA, NAU, ASU, TGen, IGC, NIH, Bioscience High & more 6 million square feet at build-out Council-Approved Master Plan

Government Owned Land City of Phoenix has spent

11 Government Owned Land City of Phoenix has spent more than 20 years and over $520 Million focusing on biosciences assets that drive: Knowledge Economy Significant capital investment High-wage jobs One of six disciplines of focus for Phoenix Academic Research Hospitals Commercialization

12 Government Owned Land

13 Government Owned Land ASU-Downtown Campus ASU - Beus Center for Law and Society Phoenix Biomedical Campus Health Sciences Education Building University of Arizona Biosciences Partnership Building 13

14 Government Owned Land UA Cancer Center at Dignity Health St. Joseph s PBC Parking Garage Bioscience Partnership Building (Opened January 2017)

Government Owned Land City currently owns 5 blocks North of Fillmore St Joint development by ASU and the City on remaining 7 acres: 3 4 Phased development with

15 Government Owned Land City currently owns 5 blocks North of Fillmore St Joint development by ASU and the City on remaining 7 acres: 3 4 Phased development with initial $75 M investment for a 200,000 SF facility Molecular Medicine at ASU High tech pharmaceutical manufacturing facilities Incubator/Accelerator 2 1 UA Cancer Center

16 Government Owned Properties

17 Ripeness Criteria Government Owned Land Held to a Higher Standard Market Acceptance Return on Cost Demand Absorption Compatibility of Uses and Objectives Community Endorsement support or oppose Utilization and Benefit Connectivity Design Amenities Blight Value to C.O.P. Monetary Return S-T L-T Social Return Transportation Jobs Housing Density Inclusion / Accessibility Streetscape Catalytic or Strategic Spur additional improvement Save or connect a key site Encourage investment Protect a key site

18 Government Owned Buildings HR Building Site Attributes Constructed in 1923 as the Ellis Building Purchased and remodeled by the City in 1996 Lot Size: 7,178 SF (0.165 acres) Building Size: 58,382 SF (6 stories w/ basement) No dedicated parking spaces

19 Development Agreements Infrastructure HR Building

20 Government Owned Land Light Rail Excess Redevelopment

21 Government Owned Land Camelback and 17 th Ave. 9,800 SF Part of a larger site Remnant from LRT construction Neighborhood has needs and opinions on development Neighborhood is changing Significant refugee community in place

22 Government Owned Land Held to a Higher Standard Camelback and 17 th Ave. Key Demographics 2015 Estimate 1 mile 3 mile 5 mile Population 27, , ,790 Median age Median HHI $28,236 $34,395 $33,170 Speak Spanish at Home Families Below Poverty Renter Occupied

23 Government Owned Land and Buildings Barrister

24 Government Owned Land 814 N. 5th Avenue

25 Government Owned Land 814 N. 5th Avenue Intent of the RFP: Create an appropriately dense project, capitalizing on its prominent urban location Enhance pedestrian-oriented amenities Facilitate urban living Consistent with applicable codes and policy documents High quality design

26 Job Creation

27 JOB CREATION Strategic Economic Development Fund Created by Phoenix City Council Community Development Block Grants Management Technical Assistance Open App Job Training Fund Workforce Innovation and Opportunity Act grant program

28 Development Agreements Job Creation

29 Historic Preservation

Landmark buildings Remove Trusses from Vintage Warehouse and Integrate Into New Construction

30 Gerardo s Building 1928 Development Agreements Historic Preservation Warehouse District Preserve, Rehabilitate and Activate Two Landmark Buildings Install Interpretative Markers for the two Landmark buildings Remove Trusses from Vintage Warehouse and Integrate Into New Construction Preserve / Salvage Additional Vintage Elements, and Integrate into Project Arvizu s El Fresnal Grocery Store 1901

Clubhouse Pools & Fitness Center Potential

31 Development Agreements Historic Preservation Preserve Historic Buildings Build New Multi-Family Residential Project 276 Market-rate Units Structured Parking Clubhouse Pools & Fitness Center Potential Retail, Office or Community Use Space $43,000,000 Project

32 Historic Preservation

33 Historic Preservation

34 Environmental Issues

Government Owned Land Environmental Issues Del Rio

from the entity Public benefit identified Lease &

Salado (Elwood and 12 th Streets) Closed municipal

35 Government Owned Land Environmental Issues Del Rio Not a land sale Certainty and specific required from the entity Public benefit identified Lease & redevelopment of 150+ acres on south bank of Rio Salado (Elwood and 12 th Streets) Closed municipal landfill Commercial development and recreational amenities

36 Government Owned Land Environmental Issues Former Superfund or Environmental sites Site is a former landfill site More geotechnical issues than environmental Redevelopment is challenging Single purpose Entities

37 Infrastructure

38 Infrastructure Loop 202 An example of a current P3 project is the construction of the new Loop 202. This $1.77 billion project is a P3 between the private sector and the Arizona Department of Transportation For the largest project in State history, ADOT partnered with a private developer (Connect 202 Partners) to design, build, and maintain the freeway for 30 years through a public-private partnership (P3). The design, build, maintain (DBM) delivery model is an innovative approach used nationwide to efficiently reduce the cost to taxpayers without sacrificing quality. The DMB model accelerates construction schedules through concurrent design, right-of-way acquisition and construction activities. For example, as soon as a section of the freeway has been cleared and design plans finalized, construction will begin while other portions of the freeway undergo the same process. Upon completion, the developer will be responsible for maintaining the freeway and ensuring the safety of the traveling public for 30 years, which results in the developer constructing the freeway with the highest possible quality. As a result of the P3, the South Mountain Freeway will be completed three years earlier than originally planned at a savings of approximately $100 million.

39 Loop 202 Infrastructure Loop 202

40 Infrastructure ABC

consultant team to prepare a master plan and other preliminary studies 2014 Construction starts on new $180

41 Infrastructure April 2012 City Council approved a MOU with ASU and Mayo Clinic to jointly plan for development of the ABC February 2013 City Council authorized staff, in collaboration with ASU and Mayo, to select a consultant team to prepare a master plan and other preliminary studies 2014 Construction starts on new $180 million Mayo Clinic Proton Therapy Center 2016 ASU, City of Phoenix and Mayo announce the Health Solutions Campus 25 Acres

42 Infrastructure Grand Canyon University More than $900M in renovations and campus expansion $19 million in public infrastructure Capital Improvement Program Street Improvements Water/Sewer

Four interactive community meetings More than 100

43 Infrastructure Adams Street Activation Over 30 meetings with individual property and business owners Four interactive community meetings More than 100 stakeholders participated Street Pavers Bio-swale Shade Canopies

44 Infrastructure Union at Roosevelt

45 Development Agreements Infrastructure Warehouse District

46 Capital Improvement Program Street Improvements Water/Sewer Rail Road Crossing On-Street Parking Infrastructure Warehouse District

47 Infrastructure

3 million passengers in FY2015 2015 ballot

48 Infrastructure Light Rail 26.3 miles long currently 14.3 million passengers in FY ballot proposition approved $31.5B 35-year transportation plan Southern and Western expansion in the designing phase for 2019

49 Public Buildings

50 Public Buildings Incubators Gateway Community College Innovative Facility Mentorship Compensative Intelligence Rapid Prototyping

51 Public Buildings Incubators

52 Public Buildings Incubators

53 Public Buildings Aviation Hotel Development Commercial Development New parking garages

Public Buildings Parking Structures Key element to locating companies into a market Cost of structured parking can be prohibitive City owned parking garages Privately

54 Public Buildings Parking Structures Key element to locating companies into a market Cost of structured parking can be prohibitive City owned parking garages Privately owned parking structures and lots Partnerships to add and redevelop City owned land Transit, Downtown, Midtown and Warehouse District Parking authority or cooperative

55 Public Buildings Amphitheater and Public Park Space Naming rights for projects Gets park developed quickly Ownership of park by community

56 What is a Public Private Partnership? Why does the City consider Public Private Partnerships? To be nimble when an opportunity that makes sense presents itself Ensure the greatest public benefit from any project through proven experts Independent review of a public project

57 What is a Public Private Partnership? We are not the only ones! Way of the future Other cities using P3s for public projects Dallas Denver District of Columbia Edinburgh Houston Long Beach Los Angeles Sacramento San Francisco Cost to Development Community to submit an RFP

58 Leveraging P3 s Questions? Christine Mackay City of Phoenix Community and Economic Development Director Christine.mackay@phoenix.gov /

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