RED Reign

RED Development is Southwest Contractor’s 2008 Phoenix Developer of the Year

With the Shops at Norterra, Prasada and now Cityscape, RED has a talent for developing projects that are reshaping the Valley of the Sun in a dramatic way.

Southwest Contractor Magazine has selected RED Development as the 2008 Phoenix Developer of the Year.

Scott Rehorn, managing partner, leasing (left) and Mike Ebert, managing partner, development.

Photo by Liana Harrison/Eclipse Communications

The company develops, leases, manages and owns shopping centers in 11 states throughout the Southwest and Midwest. RED primarily focuses on open-air lifestyle centers but also has experience with power centers, community centers and multiuse projects.

It’s now developing in downtown Phoenix the first phase of the 2.5-million-sq-ft CityScape, a mixed-use development of residential, retail, hotel, office and public park space.

With 30 centers open, in development or under construction, totaling more than 16 million sq ft, RED employs approximately 200 people in offices in Scottsdale and Kansas City, Mo. Managing partners Mike Ebert, Scott Rehorn and Dan Lowe founded the company in 1995 and have been joined by managing partners Steve Maun and Jeff McMahon.

“We are confident in the quality of the projects that we are delivering to our markets, including the Southwest,” Ebert says. “We work closely with each community during development and continue to be good corporate and community citizens after the projects are complete.”

Developing Valleywide

RED Development’s first completed Valley project was Fulton Ranch Towne Center, a 350,000-sq-ft shopping center in Chandler that opened in December 2005. RED followed with the Promenade at Fulton Ranch, a 150,000-sq-ft Tuscan-styled lifestyle center, which opened in April.

Also, under construction in Chandler is Paseo Lindo, a 73-acre residential and commercial community opening 2010.

The first phase of CityScape is being constructed by Hunt Construction Group. Wachovia Corp. will anchor the 27-story office tower.

On the Valley’s west side, in Surprise, the company is developing Prasada, the commercial component of a 4,200-acre master-planned development. A joint venture with Phoenix-based Westcor and WDP Partners, also of Phoenix, Prasada will open its first phase in spring 2009.

In Phoenix, The Shops at Norterra, a 350,000-sq-ft lifestyle center featuring specialty retailers and junior anchors, opened in April. For this project, RED joint-ventured with San Antonio-based USAA Real Estate Co.

Elsewhere in the West, The Legends at Sparks Marina is a 1-million-sq-ft shopping and entertainment destination opening this fall in Sparks, Nev. It will include unique retailers, restaurants and attractions.

Urban Oasis

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The largest private investment ever in downtown Phoenix is the mixed-use CityScape, which will unite three city blocks and encompass First Avenue to the west, Second Street to the east, Washington Street to the north and Jefferson Street to the south.

“Downtown development can be very complex, but we are confident RED has the expertise and commitment to build a truly great project,” says David Krietor, deputy city manager. The city of Phoenix is proud to have them as a development partner.”

Phase one focuses on the middle block and includes two steel-and-glass towers housing 600,000 sq ft of Class A commercial office space and 200,000 sq ft of retail and restaurants. The Phoenix office of Hunt Construction Group is the general contractor.

Charlotte, N.C-based Wachovia Corporation will anchor the 27-story 600,000-sq-ft Class A office tower. This building is targeted for LEED certification, with high-performance glazing systems and electrical and mechanical systems to optimize efficiency.

Adjacent to this will be a 34-story tower. San Francisco-based Kimpton Hotels & Restaurants will operate a 250-room Hotel Palomar up to the 14th floor. From the 15th floor, the phase two building will include 165 luxury residential condominium units.

RED expects the first phase to open in 2009 and the entire project to be complete by 2011.

On the westernmost Patriot’s Square block, renovations will be made to the existing five-level underground parking garage. Two stories of retail will sit on the perimeters of the block, and central areas will be landscaped, including a boomerang-shaped water plaza.

The Legends at Sparks Marina, a 1-million-sq-ft shopping and entertainment destination in Sparks, Nev., will open this fall.

This block will also debut the first two-level AJ’s Fine Foods, the first downtown grocery store in decades. The Phoenix office of the Weitz Co. is the construction manager at risk, with construction expected to start later this summer.

On the three-acre eastern block, development partner Barron Collier Co. of Phoenix and Naples, Fla., will develop 1.3 million sq ft of residential, retail and hotel uses as well as 1,000 below-grade parking spaces in two phases.

Leasing has been strong at CityScape because of the relative strength of the downtown office market, Ebert says. “It’s not overbuilt,” he adds. “Phoenix is a great downtown city waiting to happen.”

The Phoenix office of CB Richard Ellis is leasing the office space for the central block, while RED Development is managing the retail leasing.

“The RED Development Team has successfully and skillfully maneuvered this incredibly large and complex development through entitlement, planning and design, while coordinating with the city, light rail, Northwind, APS, Qwest, Southwest Gas and MCI - just to name a few of the important but complicating challenges,” says Robert S. Aylesworth, Jr., executive vice president of Hunt. “RED continues to demonstrate the unique ability to effectively balance design, budget, schedule and quality in ‘real time’ again and again.”

The project architect for the west and middle blocks, Seattle-based Callison, has worked with Red Development for almost three years, helping the company execute its vision for downtown. “The CityScape development will create an urban oasis in the heart of Phoenix,” says Glen Peterson, associate principal with the firm. “It is a big vision, and we have enjoyed collaborating with them.”

Sustaining Communities

RED participates in community services on a corporate level. “By nature, RED is focused on communities, and it’s important to us to support local charitable initiatives and participate in the community in a positive way,” Ebert says.

The firm has participated in such community efforts as A Day for Downtown 2007, a downtown Phoenix event focused on rehabilitating and beautifying downtown sites in which the firm worked on a domestic violence shelter. The company has also sponsored “Pulse 007,” a fund-raiser for the American Heart Association, and RED employees invest in their communities through its Corporate Citizenship Program.

The Fulton Ranch Towne Center sponsors the ICAN Pack-A-Backpack Drive, which collects backpacks and school supplies for low-income Chandler youth served by ICAN, an educational benefits group.

Ebert has served as board chair for YoungLife (Maryvale) and volunteered with the Salvation Army, Habitat for Humanity and St. Vincent de Paul. In Kansas City, Lowe has contributed both monetarily and with his time at ReStart, a shelter for the homeless.

RED’s community dedication is a function of its overall development plan, Ebert says. “We are a long-term owner of real estate - not a ‘merchant developer,’” he says. “We retain projects and therefore enter relationships with the city and the community which reaffirm this commitment.”

The company is researching sustainable development methods and plans to incorporate those into future projects. In addition to the LEED target at CityScape, RED is working toward LEED certification at two centers being developed in the Midwest.

Useful Sources

Visit RED at www.Reddevelopment.com.
Visit Cityscape's project page at www.downtownphxrising.org.

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