A Minnesota-based commercial developer spent $136 million to end a bidding war on a large chunk of vacant land in northeast Phoenix that the Arizona Coyotes once desired.
The 217-acre property located west of Scottsdale Road and north of Loop 101 was sold to Mortenson Co. at a public auction that the Arizona State Land Department held on June 20.
Mortenson, which owns dozens of office, hotel and industrial center projects in Arizona, plans to build a mixed-use corporate campus in an area that’s already undergoing a massive transformation with new developments.
At the auction, it outbid a rival firm that’s working to redevelop the former Fiesta Mall in Mesa.
“We’re super excited,” an elated George Forristall, Mortenson’s vice president of Real Estate Development, said after completing a mountain of paperwork to secure the deal at the Land Department’s downtown Phoenix offices.
The sale came exactly one year after former Coyotes team owner Alex Meruelo’s longstanding hopes of scoring a new home for the NHL franchise were dashed.
Days ahead of a scheduled auction for a 100-acre portion of the site, the Land Department canceled it.
According to a Phoenix zoning administrator, the existing zoning on the land doesn’t allow for an arena.
The site largely allows for ranch and farm residences, but can also be used for planned community districts and commercial and mid-rise developments. A portion of the property is zoned for single- and multi-family housing.
If Meruelo wanted to buy the site, he would have first needed to get a special use permit for the development. Ultimately, the team was moved to Salt Lake City, where it’s been rebranded as the Utah Mammoth.
In April, Mortenson applied to buy the land the Coyotes wanted, along with about 100 more acres on the north end of the site. That initiated the auction, which had a starting bid price of $110 million.
Mortenson wasn’t the only company eyeing the site.
The property also elicited interest from Verde Investments, the development firm owned by billionaire Ernest Garcia II, the richest man in Arizona. Verde recently acquired the last vacant portion of the Mesa mall, which is being transformed into a sprawling mixed-use development called Fiesta Redefined.
Dozens of people attended the auction in person and remotely. They watched as the companies spent about six minutes trading counteroffers for the site.
It was Mortenson, though, that won the property, outbidding Verde with the $136 million offer.
As required under Arizona law, funds the department collects from land sales directly benefit K-12 public schools, universities and other programs like the state hospital.
In an emailed statement from the company, Forristall said there were not yet specific details to share about the land’s development, other than the company wanting to “enhance the community and support continued sustainable growth in this key corridor of the Phoenix metro area.”
“Our enthusiasm for this project is matched by our dedication to fostering strong partnerships with the City of Phoenix and the State of Arizona,” he stated. “As we move forward, we are eager to collaborate closely with them.”
