Drayage Brokersin Mesa, AZ

The Arizona Coyotes have begun searching for a fallback option to build a new arena in the state after Tempe voters on Tuesday struck down plans to build an entertainment district there. Mesa’s old Fiesta Mall footprint is among the land the team has inquired about, CBS5’s and 3TV’s Dennis Welch reported Thursday.

The city of Mesa released the following statement after Welch reported that the Coyotes on Wednesday reached out about the land.

“For years Mesa has supported the redevelopment of the Fiesta District,” the city said. “Aside from being a key site for the District, Fiesta Mall is one of the most attractive pieces of urban real estate in the Valley today. It is massive, adjacent to three major highways and only 20 minutes from two major airports.

“We look forward to working with the property owner on proposals to bring diverse uses to the Fiesta Mall site and long-term sustainable and vibrant economic activity to the Fiesta District.”

As Welch adds, the Mesa option would likely require a public vote as the Tempe push did.

Moving to Mesa would keep the Coyotes on the right timeline to build a new arena because it would not require the year-or-so of land remediation needed in Tempe’s now-squashed project, which included landfill cleanup.

Fiesta Mall opened in 1979 and sits at the intersection of the US 60 and Alma School Road, a location that is easily accessible and in a relatively central, East Valley location.

The mall has been vacant in the past several years, with a Dillard’s Clearance Center being the last retail store to close down there in 2019.

The Coyotes on Wednesday confirmed they expect to play at Mullett Arena, which is operated by Arizona State University, in the 2023-24 season.

The NHL team in 2022-23 played its first season at the 5,000-seat Mullett Arena, by far the NHL’s smallest arena. The Coyotes and ASU have a deal for the pro team to play two more years at the arena with an option for 2025-26.

The $2.1 billion project for a new arena in Tempe was projected to create a 16,000-seat arena, practice rink, 300,000 square feet of upscale retail, 1,600 apartments, two hotels and a theater at Priest Drive and Rio Salado Parkway. With that plan squashed, it’s opened the possibility the team could pursue relocation to another state.

MESA, AZ (3TV/CBS 5) -- As the Arizona Coyotes consider the next steps regarding where their team will be based, Arizona’s Family has learned that the team has its eyes now set on Mesa.

Sources within the City of Mesa tell Arizona’s Family political editor Dennis Welch that the NHL team reached out on Wednesday after the loss of a public referendum in Tempe that would have created a new entertainment venue between the Mill Avenue district and Phoenix Sky Harbor airport. Details are still extremely limited on how far the talks have gone or if Mesa would consider such a proposal. Still, any potential arena deal is likely to require a public vote and put forth another referendum and a potential special election.

Less than two hours after Arizona’s Family broke the news, the city released a statement supporting the redevelopment of the site but stopped short of mentioning the team by name or about any potential deals being brokered within the community.

CONTINUING COVERAGE: What’s next? A brief history of the Arizona Coyotes

“For years Mesa has supported the redevelopment of the Fiesta District. Aside from being a key site for the District, Fiesta Mall is one of the most attractive pieces of urban real estate in the valley today. It is massive, adjacent to three major highways, and only 20 minutes from two major airports,” the statement read. “We look forward to working with the property owner on proposals to bring diverse uses to the Fiesta Mall site and long-term sustainable and vibrant economic activity to the Fiesta District.”

In the meantime, the Coyotes have announced that they would play at Mullett Arena in Tempe as they battle a tough loss of what would have been one of the largest sports deals in the state’s history. The Coyotes had played this past season at Mullett Arena in Tempe, sharing the brand-new 5,000-seat complex with the Arizona State University Sun Devils, and have a contract to play there through the 2024-2025 season.

Tempe voters overwhelmingly rejected the Coyotes’ proposed $2.1 billion entertainment district and arena earlier this week. Arizona’s Family spoke with Sam Almy, a data analyst with Uplift Campaigns. They broke down the early voting numbers in this special election. “Under 35 years old, it was about 12 to 13 percent turn out, where 65+ was closer to 63 percent turn out,” Almy said. That analysis says more than 50 percent of votes came from people who didn’t live directly near the proposed site. “South Tempe Legislative District 12 made up about 52 to 54 percent of all early returns,” he said. District 12 is south of the U.S. 60.

Copyright 2023 KTVK/KPHO. All rights reserved.

Trammell Crow Company (TCC), a global real estate developer, and CBRE Investment Management, on behalf of a separate account client, have acquired a 192-acre development site in Mesa, Arizona. The master site will be divided into ‘shovel-ready’ lots that will range from 12 acres, up to the full 192-acre site. These sub-sites will be available for sale to a wide array of interested users; alternatively, TCC will be able to provide build-to-suit solutions for interested corporate users. The sale price was $27,960,939, according to Vizzda.

Located in the Southeast Valley submarket, in the center of Mesa’s Advanced Manufacturing Corridor, the site is the largest one in Maricopa County that can accommodate Union Pacific Rail users. TCC will perform horizontal improvements on each sub-site, including the extension of utilities and roadway build out, beginning in summer 2023. The sub-sites, which are located within an Opportunity Zone, are available for purchase or for build-to-suit development.

The master site is located only a quarter mile away from a full diamond intersection along the recently completed SR-24 Freeway Extension, a location that will further stimulate demand from large industrial users who require large, accessible pad sites in an increasingly land-constrained market. Notably, the Union Pacific Pecos Industrial Rail Access and Train Extension (PIRATE) line, planned to be complete by the end of 2023, is set to run directly through the master site; rail accessible sub-sites will be available.

“Despite the uncertainty about the overall economy and the industrial sector in the U.S., the market fundamentals for the Phoenix industrial sector remain strong, with historically low vacancy rates and continued demand for new space carrying through the end of Q4 2022. The Southeast Valley was one of the most active submarkets at the tail end of last year, due in part to the area’s abundant labor pool, and we are still seeing strong activity as we enter the second quarter of 2023,” said Ryan Norris, Principal with TCC.

According to CBRE’s Q4 2022 Phoenix Industrial Market Report, during Q4 2022 alone, 67 tenants were in the market for 8.1 million square feet of space, specifically in the Southeast Valley, where the vacancy rate was three percent. The submarket kept a healthy pace of net absorption and welcomed local and out-of-state business looking for quality industrial space.

Norris continued, “In order to balance the various economic implications – meaning the national economic uncertainty and the continued local demand for industrial space – we wanted to create a flexible development site that allows us to offer sub-divided, shovel-ready sites for purchase, as well as sites where we can implement our build-to-suit expertise for industrial users looking to enter or expand their footprint in the market. Our firm’s ability to anticipate a changing market and implement this type of development concept is an indicator of how TCC remains on its front foot when it comes to delivering the best outcomes for our partners and clients.”

“We’re excited to partner with Trammell Crow to provide this unique, flexible development solution that can serve a variety of industrial users in search of modern industrial space in this key, growing submarket. We believe that the continued high demand for logistics and industrial real estate, the location’s convenient proximity to major transportation nodes and Trammell Crow’s extensive experience in customizing and delivering top-of-the-line properties will offer long-term value for both future occupiers and our client,” said Mary Lang, Head of Americas Direct Logistics Strategies for CBRE Investment Management.

Jackie Orcutt of CBRE and her team represented the land seller, and her team will represent the TCC and CBRE IM JV on the land sale transaction(s).

The Coyotes are still looking to secure a long-term place to play in the state of Arizona.

Days after the City of Tempe voted against development plans for a new arena, a fallback option appears to have emerged, as the Coyotes are now considering a site in Mesa near Fiesta Mall, according to a report from Dennis Welch of AZfamily.com.

Sources: Arizona Coyotes consider former site of Fiesta Mall in Mesa for sports arena https://t.co/0HUJJ64OHn pic.twitter.com/yKx7L0pAZ1

— azfamily 3TV CBS 5 (@azfamily) May 18, 2023

Fiesta Mall opened in 1979 and features a location that is easily accessible and in a relatively central, East Valley location.

Per ArizonaSports.com, the city of Mesa released a statement following Welsh’s report:

“For years Mesa has supported the redevelopment of the Fiesta District,” the city said. “Aside from being a key site for the District, Fiesta Mall is one of the most attractive pieces of urban real estate in the Valley today. It is massive, adjacent to three major highways and only 20 minutes from two major airports.

“We look forward to working with the property owner on proposals to bring diverse uses to the Fiesta Mall site and long-term sustainable and vibrant economic activity to the Fiesta District.”

The Mesa option would require a public vote, similar to what occurred with Tempe.

The Coyotes played this past season at Mullett Arena, sharing the complex with the Arizona State University Sun Devils, and have a contract to play at the arena through the 2024-2025 season. The team confirmed to season ticket holders earlier this week that it would be using the venue next season.

"While we are very disappointed Tempe voters did not approve the proposed Entertainment District, we want to thank all our loyal fans who supported the Coyotes over the years. Your loyalty is what makes our Pack strong," Coyotes president and CEO Xavier A. Gutierrez wrote in a letter to the fans.

The Coyotes also released a poll via social media on Thursday, asking supporters where they would like to see a new arena built in Arizona. Hockey fans had a field day with their responses to the tweet, and mentioning several .

Danish logistics powerhouse DSV A/S will start operating its private-label cargo airline next month at relatively unknown Phoenix-Mesa Gateway Airport, a strategic move aimed at courting Arizona’s sprouting semiconductor and electric vehicle industries with direct service that bypasses crowded Los Angeles International Airport.

The world’s third-largest freight forwarder by revenue in February signed a 39-month lease with the Phoenix-Mesa airport authority for a 22,000-square-foot hangar that will function as a makeshift terminal for processing cargo moving on large freighter aircraft.

DSV has engaged Cargolux and Atlas Air to provide dedicated transport utilizing Boeing 747 cargo jets. Cargolux will begin weekly scheduled service from Luxembourg on June 5. Tentative plans call for Atlas Air to deliver cargo from Hong Kong and Taipei, Taiwan, to Phoenix-Mesa starting sometime in July, but final routing decisions are still being worked out, Mads Ravn, executive vice president and head of global airfreight procurement, told FreightWaves.

Service to Phoenix-Mesa from Asia will actually piggyback on an existing operation provided by Atlas Air to DSV’s original U.S. hub at Huntsville International Airport in Alabama. Those flights continue to Miami and then to Sao Paulo. DSV intends to fly directly from Phoenix-Mesa to Latin America and offer export service back to Europe and Asia in the third quarter, said Ravn.

DSV is hosting a ribbon-cutting Tuesday morning, attended by local officials and other stakeholders, to inaugurate the latest location in its airfreight network.

Phoenix-Mesa “provides us with a serious competitive edge against our competitors … . Offering cargo aircraft capacity with the ability to exclusively manage the ground handling significantly strengthens growth opportunities — not only for DSV but for our customers as well,” said Niels Larsen, president DSV Air & Sea US, in an April news release.

Secondary airport for semiconductors

Phoenix-Mesa Gateway Airport, which sits in the shadow of sprawling Phoenix Sky Harbor airport, is an unlikely location for facilitating international trade. A former U.S. Air Force base with three 10,000-foot runways, Phoenix-Mesa caters to regional airlines like Allegiant.

DSV represents the first scheduled cargo service based at Phoenix-Mesa. The selection is part of a growing trend that has seen major logistics companies and all-cargo carriers collaborate to route shipments through second- and third-tier airports where they can get priority treatment at a fraction of the cost of a major passenger airport.

Good infrastructure, focused service, longer operating hours and fast clearance by customs authorities make it easier to pick up inbound shipments at smaller airports, according to air cargo experts.

By leasing airside cargo terminals, logistics providers gain direct control over their freight compared to using multitenant facilities that disassemble and prepare loads for pickup at major gateways.

Cargo bottlenecks are common at major passenger gateways, where many terminals are outdated, lack modern technology, and have limited truck access, dock doors and appointment systems. Freight retrieval is often slow as shorthanded ground handling agents have to locate and consolidate shipments for dozens of freight forwarders before they can be released.

At cargo-focused airports, handling agents can service forwarder-controlled flights as soon as they arrive, reducing lead and recovery times.

DSV officials say Phoenix-Mesa is an excellent alternative to Los Angeles International Airport, where it can take up to two days to retrieve inbound shipments and would require a 400-mile drive by truck to Phoenix.

The company claimed the hangar as a temporary solution for quickly targeting new business opportunities with semiconductor and electric car manufacturers, mining operations, and alternative energy companies until a permanent facility is built.

In March, DSV acquired two Phoenix-area trucking and logistics companies to strengthen its local capabilities and support the airfreight service.

Phoenix Sky Harbor airport hasn’t done much to court cargo business, according to airport industry experts.

Arizona is becoming a semiconductor and electric vehicle hotbed, especially with federal incentive programs, including through last year’s CHIPS Act, to encourage more domestic production in industries critical for national security.

Taiwan’s TSMC, the largest chipmaker in the world, is building a massive fabrication plant in Phoenix and expects to begin production next year. It announced in December plans for a second, multibillion-dollar semiconductor facility north of Phoenix. Intel is also investing $20 billion to expand its campus in nearby Chandler, Arizona.

In March, LG Energy Solutions announced plans to build a $5.5 billion plant to make batteries for electric vehicles and energy storage systems. Is the latest in a string of battery companies moving to Arizona. Since December, Ecobat has announced plans to build a lithium-ion battery recycling facility in Casa Grande, American Battery Factory has said it will invest $1.2 billion to build a lithium-ion battery manufacturing facility in Tucson, and Sion Power has announced it is expanding its Tucson battery manufacturing operation.

DSV has options to renew the hangar lease, which starts at $366,000 per year and annually escalates 3% to 4%, for up to six years. Ravn said DSV has hired Worldwide Flight Services to provide ground handling services, including truck transfers, for the freighter operations. The logistics provider has installed its own ground equipment and conducted two test shipments in March to familiarize employees and contractors with the Phoenix-Mesa airfield.

DSV has not committed to any expansion, but airport officials say they anticipate the logistics provider will eventually occupy a much larger facility that would be built by SkyBridge Arizona, a private consortium that owns the master development rights for 360 acres of airport property.

Peter Wentis, a senior vice president at real estate services firm CBRE, said SkyBridge has plans for buildings conducive to airfreight and DSV is aware of them.

DSV’s new Arizona capabilities will allow the company to offer more routes to Latin America and Mexico.

A pending system at Phoenix-Mesa that would allow U.S. and Mexican customs authorities to jointly inspect cargo bound for Mexico could help DSV’s southern route expansion. Under the program, the airport essentially becomes Mexican sovereign territory for export purposes. The government can then treat inbound flights as domestic flights and eliminate a redundant inspection upon arrival. Airport officials envision shippers of high-value and e-commerce goods taking advantage of air cargo to avoid the risk and delays associated with cross-border trucking.

The unified cargo processing system is operational at a dozen U.S. commercial ports along the Southern border.

The Phoenix-Mesa airport authority said it has U.S. Customs approval to implement the program.

Other cargo-focused airports capturing business that previously went to mega-hubs include Birmingham, Alabama; Chicago Rockford; Cincinnati/Northern Kentucky International Airport; Greenville-Spartanburg in South Carolina; Rickenbacker International Airport in Columbus; Pittsburgh; and San Bernardino, California.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Twitter: @ericreports / LinkedIn: Eric Kulisch / ekulisch@freightwaves.com

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