Quarterly Report Fiscal Year th Quarter

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1 City of Chandler Quarterly Report Fiscal Year th Quarter

2 INDEX Table of Contents INTRODUCTION... 3 ECONOMIC DEVELOPMENT OUTLOOK... 5 ECONOMIC TRENDS... 7 RETAIL INDUSTRIAL/OFFICE DEVELOPMENT TOURISM

3 INTRODUCTION Economic development activity continued on a positive trend during the fourth quarter. For the quarter ending June 30, 2012, Economic Development staff combined efforts identified 1,043 leads and 21 prospects, representing an estimated 1,244 jobs, occupying approximately 311,907 square feet of space and $34.1 million in capital investments. 4th Quarter Combined Efforts Retail Industrial/Office Tourism Total Leads ,005 1,043 Prospects Jobs 52 1,192 1,244 Square Footage 13, , ,907 Capital Investment $34,120,723 $34,120,723 Retail: During the fourth quarter, Economic Development Retail staff continues to work with developers, brokers, and shopping center owners on major retail developments, while tracking all existing retail centers and tenants, including those projects under construction or planned. Staff continues to work with clients by keeping track of when the construction permits are reviewed and issued. For Q4, Retail staff participated in the following activities: Activity Location Date ICSC ReCon Las Vegas, NV May 20-23, 2012 For Q4, Industrial/Office staff participated in the following activities: Activity Location Date White House ED Forum Phoenix, AZ April 13, 2012 CoreNet San Diego, CA April 29, 2012 AAED Spring Conference Sedona, AZ May 9-11, 2012 AZ Bio Expo Phoenix, AZ May 17, 2012 DC Sales Mission Washington, DC June 5-7, 2012 ASU Economic Summit Chandler, AZ June 14, 2012 Bio Annual Trade Show Boston, MA June 18-22, 2012 Tourism: Tourism staff conducted the following trade and media activities for Q4: Activity Location Date Sunny Arizona Travel Agent FAM Chandler, Tempe, Mesa, April 12-15, 2012 Apache Junction PRSA Tourism Conference Columbus, OH June 3-7,

4 INTRODUCTION In addition to trade and media activities and travel, staff operates the City of Chandler Local Bites; a unique list of restaurants that supports Chandler s one-of-a-kind dining experiences whether they are independently owned or extraordinarily unique in the market. Downtown: Economic Development Downtown Redevelopment staff continues to work with the merchants to collaborate in advertising and promoting business in Downtown Chandler. Staff coordinated efforts with the Downtown Chandler Community Partnership (DCCP), Arts Commission, Façade Grants, Site 8 Parking, Urban Gardening and various Special Events. Disclaimer: Content is intended to provide general information to the public and every effort has been taken to ensure that the information is accurate. Data is submitted subject to the possibility of errors, omissions and changes, but is obtained from sources and/or formulas deemed reliable. 4

5 ECONOMIC DEVELOPMENT OUTLOOK Locating and expanding quality industrial, commercial, retail, and small business opportunities throughout the City of Chandler and Downtown Chandler are of great importance to Chandler s future economic impact and it is essential to the City of Chandler s estimated population of 239,397 citizens and approximated 95,701 housing units located in the City s borders as of June 1, Economic Development personnel continually update economic data, and demographic and development trends to maintain current information to better assist clients with their search for potential development opportunities. The information also aids Economic Development staff in identifying areas of opportunity and specific gaps, in targeting retail markets and linkages to key census information, which assists in presenting available sites. 1,410 1,210 1, Jobs Created ,192 Industrial/Office Jobs Retail Jobs 600,000 Square Footage 500, , , , , , , , ,179 99,866 85,435 50,280 Industrial/Office S.F. Retail S.F. 13,943 5

ECONOMIC DEVELOPMENT OUTLOOK The economic vitality of the City of Chandler relies on job growth and

The influx of educated workers, sustainable increases in population, higher education choices and a

Population Growth Source: City of Chandler Planning Division June 1, 2012 Q1 Population 237,776 237,926

6 ECONOMIC DEVELOPMENT OUTLOOK The economic vitality of the City of Chandler relies on job growth and demographic factors. The influx of educated workers, sustainable increases in population, higher education choices and a pro-business record, lay the groundwork for healthy job creation and employment opportunities. Population Growth Source: City of Chandler Planning Division June 1, 2012 Q1 Population 237, , ,041 Jul. Aug Sep Q2 Population 238, , ,451 Oct Nov Dec Q3 Population 238, , ,042 Jan Feb Mar Q4 Population 239, , ,397 Apr May Jun Source: City of Chandler, Sales Tax & Li 6

1st & 2nd Quarter Unemployment Rate Arizona Phoenix Chandler July Aug Sep Oct Nov Dec Q1 Source: Arizona Department of Commerce

7 ECONOMIC TRENDS According to the Arizona Department of Commerce, by the end of Q4, the City of Chandler s average unemployment rate is 5.8% while the City of Phoenix has a 7.4% unemployment rate and the state of Arizona has an 8.1% unemployment rate. 1st & 2nd Quarter Unemployment Rate Arizona Phoenix Chandler July Aug Sep Oct Nov Dec Q1 Source: Arizona Department of Commerce Q2 3rd & 4th Quarter Unemployment Rate Arizona Phoenix Chandler Jan Feb Mar Apr May Jun Q3 Q4 Source: Arizona Department of Commerce 7

ECONOMIC TRENDS Employment By Occupation Employment by

per establishment within various industries.

Professional Service Production, Transport, Material Moving

Maintenance Source: Claritas Chandler's Employment Numbers The

increase according to statistics obtained from the Arizona

8 ECONOMIC TRENDS Employment By Occupation Employment by Occupation Data identifies and analyzes total employee counts per establishment within various industries. Service Occupation Farming, Forestry and Fishing Managerial and Professional Service Production, Transport, Material Moving Technical Sales-Administrative Support Construction, Extraction, Maintenance Source: Claritas Chandler's Employment Numbers The City of Chandler employed citizens numbers show a steady increase according to statistics obtained from the Arizona Department of Commerce. Q4 Jun. 123,742 Q4 May. 124,718 Q4 Apr. 123,766 Source: Arizona Department of Commerce 8

9 ECONOMIC TRENDS During the fourth quarter, the number of employed citizens reflects a slight increase for the City of Chandler and the state. According to the Arizona Department of Commerce, Since last quarter, the City of Chandler gained an average of 1,099 jobs to its 122,976 total from the previous quarter; a 0.89% increase. Employment Comparison: Chandler vs. Arizona Jun May 2,761, ,742 2,778, ,718 Apr 2,756, ,766 Mar 2,755, ,701 Feb 2,747, ,282 Jan 2,718, ,946 Dec 2,750, ,426 Nov 2,757, ,392 Oct 2,753, ,063 Sep 2,749, ,812 Aug 2,728, ,817 Jul 2,720, ,512 5,000 50, ,000 5,000,000 9

10 RETAIL Economic Development Retail staff located three new companies that included two restaurants and one health/fitness club to the City of Chandler. Retail Leads & Prospects Prospects Leads Q 1 Q 2 Q 3 Q 4 Specific Q4 Retail activities: 1. Anytime Fitness Located on the North West corner of Chandler Blvd. and Alma School Rd. this Anytime Fitness provides their members the latest cardio and strength fitness equipment, fitness classes, along with personal training and a nutritionist. The gym operates 24-hours a day for any member looking to lose weight, tone-up, or train for a big event. 2. Jimmy John s In 1983, Jimmy John Liautaud checked out a handful of cookbooks from his local library, and perfected his award-winning bread. After creating four sandwiches, Jimmy tested them on friends and family. Without hesitation, he opened the very first Jimmy John's with a whopping $200 a month in rent and used equipment consisting of a refrigerator, a chest freezer, an oven, and a meat slicer. College kids loved the low price, great food and the fact that they delivered. To-date, with over 1,900 stores open, Jimmy John s signature bread is baked in-house every day and the meat and veggies are sliced in-house to be served fresh every day. Jimmy John s is proud to serve real turkey and roast beef without additives or vegetable-based fillers, because Jimmy John's wants only the best for the best. 10

11 RETAIL 3. Nando s Mexican Cafe From a young age, Guillermo Fernando Rios Nando, nana taught him how to cook Sonoran style. As he grew up, Nando wanted to open a restaurant but was unable to peruse that dream at the time because he did not have the finances. Nando and his friend Timbo found themselves in Las Vegas on Freemont Street in a backroom playing No-Limit-Texas-Hold em, the Cadillac of poker. Some twelve hours later, two players left and Nando peeks at his cards and does not blink. He was all in; three of a kind beats two pair. Always, no contest and off they went back to Gilbert, Arizona to build his first Mexican restaurant followed by the 2nd location in Mesa, Arizona and the latest addition on the north east corner of Germann Road and Dobson Road in Chandler, Arizona. Retail NAME LOCATION JOBS S.F. 1 ST Quarter Locates Culver's Loop 101 & Ray d 20 3,000 Arco AM/PM Arizona & Chandler Blvd 5 3,000 Wendy's Arizona & Ocotillo Rd 10 4,000 MVP Zone Gilbert & Germann Rd 2 15,000 The Sushi Room Dobson & Queen Creek 10 2,231 Uno Stop Laundromat Arizona & Galveston 2 6,400 Hobby Lobby Loop 101 & Chandler Blvd 4 4,762 Freddy's Frozen Custard Loop 101 & Frye ,175 Jimmy Johns Loop 101 & Chandler Blvd 7 4,098 2 nd Quarter Locates Rudy's BBQ 54th St & Chandler Blvd 20 7,297 Five Guys Burgers Arizona & Ocotillo 20 1,355 Ahwatukee Foothills Prep School (Reuse) Kyrene & Ray Rd 25 36,743 You Fit Alma School & Chandler Heights 10 18,102 Can't Stop Smokin BBQ 54th St & Chandler Blvd 10 5,000 Planet Fitness Arizona & Loop ,938 3 rd Quarter Locates Ideal Rehabilitation Dobson & Frye 12 6,200 Pruitt s Alma School & Ray 26 38,000 Jolie s Place Arizona & Warner 10 6,080 4 TH Quarter Locates Anytime Fitness Alma School & Chandler Blvd 12 5,100 Jimmy John s Arizona & Warner 15 3,100 Nando s Dobson Rd & Germann 25 5,743 11

12 RETAIL Economic Development and job creation accompany one another, and job creation offers ways to advance the economic security of the city s population. Nando s replaced a portion of the restaurant pad at The Shops at Pecos Ranch that was previously occupied by Tia Rosa s. Staff efforts in this quarter produced 52 new jobs and occupied 13,943 square feet of retail space. Retail Total Jobs Created Retail Total Square Feet By the end of the 4 th quarter, staffs combined efforts created 395 new jobs and occupied 249,524 square feet of retail space. 99,866 85,435 50,280 13,943 12

INDUSTRIAL & OFFICE Economic Development Industrial and Office staff efforts located five new companies to the City of Chandler with a wide range of office and industrial retention and expansion

13 INDUSTRIAL & OFFICE Economic Development Industrial and Office staff efforts located five new companies to the City of Chandler with a wide range of office and industrial retention and expansion sites. Industrial & Office Leads & Prospects Prospects Leads Q 1 Q 2 Q 3 Q 4 Specific Q4 Industrial/Office Activities: 1. Insys Therapeutics, Inc. Insys Therapeutics, Inc. is a specialty pharmaceutical company that develops pharmaceutical products that target the unmet needs of cancer patients, with an initial focus on cancer-supportive care and cancer therapy. Their supportive care product candidates include Subsys, a proprietary, fastacting sublingual fentanyl spray for the treatment of breakthrough cancer pain (BTCP), and their family of dronabinol product candidates for the treatment of chemotherapy-induced nausea and vomiting (CINV), and appetite stimulation in AIDS patients. 2. QBE QBE First is the Atlanta-based division of QBE Insurance Limited, Australian company. QBE will move its Chandler call center into a bigger building capable of supporting a larger workforce. The building contains 183,000 square feet, with room for more than 1,000 employees. The company will move its 600 employees from a current center at Ellis Road at 2700 W. Frye Road to the new location near the Chandler Fashion Center shopping mall by the end of Von Ardenne North America Inc. Von Ardenne manufactures equipment for architectural glass coating. They supply advanced coating equipment for the solar industry (solar thermal, 13

14 INDUSTRIAL & OFFICE photovoltaics, concentrated solar power). Their coating equipment, allows them to manufacture technologically sophisticated products that help save resources and energy or open new ways to produce energy. Apart from the headquarters in Dresden, Von Ardenne has additional service centers in China, Malaysia and 2 locations in Ohio and Chandler, Arizona. 4. Dow Media Dow Media Group (DMG) a tenant at Chandler s Innovations Science and Technology Incubator draws on their extensive Fortune 100 experience in ecommerce, CRM and marketing to provide clients with marketing strategies that work. The firm specializes in creating marketing solutions for technology companies by designing positive user experiences. DMG builds focused strategies to enhance engagement, increase loyalty and deliver a more amplified impact to a company s marketing voice. 5. Smart Modular Solutions SMART Modular Technologies, Inc. (SMART) is a leading international manufacturer of memory modules and solid-state storage solution for OEMs in today s fastest growing application markets around the world. SMART s comprehensive lines of solid state drives (SSDs), removable flash memory products, embedded storage, and DRAM memory modules satisfy a broad range of applications including communications networking, enterprise computing, defense storage, and gaming. Headquartered in Newark, CA, the company also operates several specialized supply chain, design facilities, sales and support centers worldwide. SMART manufactures its products throughout the world in Newark, California; Sao Paulo, Brazil; and Penang, Malaysia and their new design center in Chandler, Arizona. 6. AmorWorks ArmorWorks provides high-tech military armor protection. Their armor systems are in service around the world in several U.S. Military applications. They specialize in all aspects of military armor technology i.e. Aerospace, Personnel, Vehicle, and Ship Armor Application. Their engineering and fabrication services take your armor systems project from concept to production. Industrial/Office NAME LOCATION JOBS S.F. CAPITAL INVESTMENT 1 st Quarter Locates National Association Sports Medicine Santan Fwy & Cooper 40 14,300 $715,000 Soilsworks (Retention) Santan Fwy & Cooper 53 10,708 $525,000 Levementum (Expansion) Downtown Chandler 40 10,500 $375,500 Dunkin Donuts (Commercial) McClintock & Chandler $900,500 14

15 INDUSTRIAL & OFFICE Industrial/Office Industrial/Office Industrial/Office Industrial/Office 1 st Quarter Locates Continues NAME LOCATION JOBS S.F. CAPITAL INVESTMENT Serious Integrated Innovation Incubator $0 Amkor Innovation Incubator 15 2,500 $0 BCR Diagnostics Innovation Incubator 5 1,014 $0 NativasMax Innovation Incubator $0 Toyko Electron (Retention) Frye & Price 35 11,032 $300,000 NAME LOCATION JOBS S.F. 2 nd Quarter Locates CAPITAL INVESTMENT Ports America Downtown Chandler ,000 $6,500,000 Garmin (Expansion) McClintock & Chandler 30 6,625 $298,000 International Trading Systems Arizona & Elliot Rd ,026 $1,372,220 Transpac Aviation Academy Ryan & McQueen 10 3,846 $150,000 Phoenix Packaging Arizona & McQueen ,400 $104,000 NAME LOCATION JOBS S.F. 3 rd Quarter Locates CAPITAL INVESTMENT Triumph Group, Inc. Chandler Blvd. & 56th St ,163 $6,500,000 Cyrus One Price Rd & Germann Rd ,620 $180,620,000 NextFort Price Rd & Germann Rd ,673 $25,000,000 Unisource Germann Rd & 202 Frwy 20 6,400 $980,000 Chandler Regional Medical Center Tower Dobson Rd & Frye Rd 200 6,200 $125,000 NAME LOCATION JOBS S.F. CAPITAL INVESTMENT 4 th Quarter Locates Insys Therapeutics Inc., Price & Frye 60 20,931 $1,190,723 QBE Frye & Price 1, ,000 $25,000,000 Von Ardenne North America Inc. Cooper & Germann $450,000 Dow Media Innovations Incubator n/a Smart Modular Solutions Frye & Ellis ,783 $2,480,000 ArmorWorks Chandler & 56 th 20 70,000 5,000,000 Job creation offers ways to advance the economic security of the city s population while capital investment is a major planning tool in which needed improvements to the City's facilities and infrastructure are identified. 15

1,200 1,000 800 600 1,192 400 610 415 200 223 0 Capital Investment FY 2011-2012

16 INDUSTRIAL & OFFICE 1,400 In this quarter, Chandler Economic Development staff efforts produced 1,192 new jobs and secured $34.1 million in capital investment. 1,200 1, , Capital Investment FY $250,000,000 $213,225,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 $2,816,000 $9,320,220 $34,120,723 $0 16

17 INDUSTRIAL & OFFICE Approximately 297,964 square feet of Industrial & Office space was occupied during the fourth quarter alone. At the end of the fourth quarter, staff combined efforts created 2,440 new jobs, occupied approximately 1,049,496 square feet of industrial and office space and secured $259.4 million in capital investment. Industrial/Office Total Sqare Feet FY , , , , , , , , , , , ,000 50, ,179 17

While continued growth in the Valley s hospitality industry is apparent, the Valley continues to lag behind the rest of the nation. Smith Travel Research, Inc.

18 TOURISM During the fourth quarter, Tourism staff finalized the FY13 Prop 302 Maricopa County Grant Application. The hotel industry in Metro-Phoenix continues to struggle, although it is gaining ground with ADR growth. While continued growth in the Valley s hospitality industry is apparent, the Valley continues to lag behind the rest of the nation. Smith Travel Research, Inc. (STR) has developed the specific Q4 Chandler and metro Phoenix hotel industry occupancy, average daily rate (ADR), and revenue per available room (RevPar) as a custom set for the Chandler market that are represented in the charts below: Chandler Hotel Occupancy Rate FY % 70.0% 50.0% 30.0% 10.0% Chandler Hotel ADR FY % 90% 70% 50% $77.16 $88.61 $ $ % 10% 18

TOURISM Chandler Hotel RevPar FY 2011-2012 110% 90% 70% 50% $45.06 $55.90 $80.99 $54.64 30% 10% Metro Phoenix Comparison () Occupancy 58.4% 62.9% 75.8% 61.0% Occupancy 48.3% 55.2% 71.7% 57.

19 TOURISM Chandler Hotel RevPar FY % 90% 70% 50% $45.06 $55.90 $80.99 $ % 10% Metro Phoenix Comparison () Occupancy 58.4% 62.9% 75.8% 61.0% Occupancy 48.3% 55.2% 71.7% 57.1% Average Daily Rate $77.16 $88.61 $ $89.97 Chandler Average Daily Rate $81.79 $ $ $ Metro Phoenix Revenue per available room $45.06 $55.90 $80.99 $54.64 Revenue per available room $39.49 $56.69 $91.94 $57.91 In Chandler, much of the substantial growth in hotel occupancy continues to be attributed to the increased business travel prompted by the expansion of Intel - currently the world s second largest private development. 19

20 TOURISM Tourism staff generated a combined 14,153 lead by the end of this quarter. Tourism staff also maintains the tourism website, that is featured in each advertisement, brochure and press release and utilized at trade shows. Staff works with the Chandler Local Bites website, which is a guide to unique and local chandler eateries and drinks for residents looking for great places to eat or take visitors. Additional information can be obtained on the website, or at local restaurants, hotels, City facilities and visitor s bureaus. 20

Quarterly Report Fiscal Year nd Quarter

Quarterly Report Fiscal Year nd Quarter City of Chandler Quarterly Report Fiscal Year 2011-2012 2nd Quarter INDEX Table of Contents INTRODUCTION... 3 ECONOMIC DEVELOPMENT OUTLOOK... 5 ECONOMIC TRENDS... 7 RETAIL... 9 INDUSTRIAL/OFFICE DEVELOPMENT...