Article Originally Posted By PhoenixBusinessJournal On March 9, 2022
The planned redevelopment of a retail center in south Scottsdale to add 238 apartment units and 25,000 square feet of new retail and restaurant space is “a sign of the times,” the project’s zoning attorney said.
After owning the center for 17 years, Todd Silver has plans to raze much of the existing big-box retail, making up about 65,000 square feet on seven acres, located at Hayden and Osborn roads. The project has gone through several iterations since it was first submitted to the city of Scottsdale in 2019, and after decreasing the proposed density of the apartment units and adding retail uses, the project was approved by Scottsdale City Council in February.
Jason Morris, partner at Withey Morris and attorney for the project, called Greenbelt 88, said Silver was faced with a couple of choices of what to do with the center when it was clear it had outlived it usefulness as solely retail. The choices included “right-sizing” the retail on the site and dividing the larger stores into smaller spaces, finding tenants that would take the spaces as-is — which might include uses that do not necessarily bring value to a neighborhood, like self-storage or a charter school — or creating a long-term solution like transforming the site into a mix of uses.
Scottsdale has more retail space per capita than other cities in the Valley, he said, so transformations like Greenbelt 88 might become more commonplace. Morris was also the zoning attorney for a Phoenix case where a former movie theater is planned to be redeveloped into apartments. Scottsdale-based Nelsen Partners is the architect.
“The need for housing around the Valley is quantifiable,” Morris said. “There is a demonstrated need for additional housing, and there are a lot of barriers in place, not just zoning but building materials, labor and the time it takes to go through the building review process.”
The complex will be luxury and include high levels of amenities. Morris said much of the demand for housing in Scottsdale is driven by young professionals.
“There is an influx of new residents, and we have to be able to provide housing for them,” Morris said.
'Wrapped' by apartments
The plans originally proposed 388 units of residential without any new retail on the south Scottsdale site, but after working with stakeholders that included neighbors and the city, Morris said the plans were revised to decrease the number of units and add retail uses to the site.
The years-long process was “like a root canal but not as fun,” he said.“We always believed this was such a good case,” Morris said. The development team worked on the zoning process throughout the Covid-19 pandemic, and meetings for the project were some of the first virtual neighborhood meetings organized by Withey Morris’ office.
The plans call for razing the majority of the shopping center on the western portion of the site, which includes space leased by Office Max and Big 5. Morris said the intention is for some of the existing tenants to lease space in the new retail buildings but plans have not been finalized.
The new apartments will be built on the western side, facing the greenbelt, and a new parking structure will be included. The parking structure will be “wrapped” by the apartments and new retail buildings immediately east of the garage to hide it from view. Some of the remaining freestanding pads, like the Arizona Federal Credit Union branch and the Starbucks, are owned by others and will remain. The developer plans to add some new retail pads to the site as well, according to city documents.
There are still some retail leases in place for the building that will be redeveloped, so Morris said development will not happen for a while. The next step in the process includes going back to the city’s development review board for approvals for colors and aesthetic finishes, which will take a few months, Morris said. The retail buildings nearest to Hayden Road will be constructed first.