Economic & Business News Winter 2008
Phoenix Adds 1,000-Room Hotel to Downtown Phoenix Mayor Phil Gordon proudly cut the ribbon on October 1 at the inauguration of the city-owned Sheraton hotel in downtown Phoenix. The hotel was financed with a $350 million revenue bond issue. The city built the 31-story hotel to make sure there were enough first-class hotels within walking distance of the expanded Convention Center. The larger conferences and trade shows scheduled for the expanded convention center meant that the Sheraton had booked more than 350,000 room nights before it even opened. The city of Phoenix also owns and operates the Phoenix Convention Center. Sheraton won the contract to manage the 1,000 room hotel, the largest in the state of Arizona, and had a say in the design and furnishings of this five-star hotel. The hotel has 80,000 square feet of flexible meeting and ballroom space, as well as a large fitness center, an outdoor pool and an internet café in the lobby with complimentary computers.	Phoenix Light Rail Begins Operations The light rail trains will officially open for passenger traffic on December 27, but nearly empty trains have been quietly sliding along their tracks for weeks to test the equipment and train the drivers. METRO, the public corporation formed to operate the initial 20-mile system, is predicting 26,000 boardings per day during its first year in service. Each modernistic wagon holds up to 200 passengers and the trains will have either two or three wagons. The trains will operate 18 to 20 hours per day, every day of the year with a peak frequency of every 10 minutes and an off-peak frequency of 20 to 30 minutes. The wagons are powered by overhead electric lines and have lanes for their tracks separated by curbs from the street traffic. Therefore, the trains will cover the 20 mile distance, complete with 27 stops, in little more than one hour. Six extension lines, already planned, will add 37 miles to the light rail system.
Planned Community Opens in North Phoenix The first phase of the CityNorth planned community opened in mid November with three days of festivities. CityNorth is a 144-acre, mixed use development by Related Urban and the Thomas J. Klutznik Company. The proposed $1.8 billion investment will eventually include 2,000 residential units, 1.2 million square feet of retail and restaurant space, 2 million square feet of office space, two hotels and five parking structures. The first phase includes 40 retail stores with high-end condominiums above them in a pedestrian-friendly setting.	Existing House Sales Jump in September The sales of existing homes in the Phoenix metro area during the month of September jumped to 5,749 units, an astounding 70% more than in September 2007. The median price on those houses was around $170,000, about 20 percent less than the figure 12 months earlier. Almost half of the houses sold were owned by banks that had foreclosed on the former owners and they generally sold for lower prices than owner-occupied houses. The surge of sales is good news for local realtors, house inspectors and mortgage bankers. Lower house prices have made Phoenix once again one of the most affordable large cities in the country.
Phoenix Utility Awarded Solar Research Grant Phoenix-based Arizona Public Service Company, the largest electric utility in the state, was awarded a $4 million grant from the U.S. Department of Energy to test thermal storage technologies. Two methods for storing heat will be tested at a small solar thermal plant owned by APS. The one megawatt solar thermal plant currently has no thermal storage and can generate electricity only when the sun shines. One method will store heat in sand. The other will store heat in a tank of oil filled with rocks. The APS plant uses mirrors to concentrate solar heat on fluid-filled tubes that boil water to generate electricity with steam. If the heat storage systems are successful, the plant will be able to generate electricity for a few hours after sunset.	Museum for Musical Instruments Being Built Construction is well underway on a two-story building in northeast Phoenix to house a Musical Instrument Museum. The museum, projected to open in early 2010, will have 75,000 square feet of exhibition galleries with about 350 displays of instruments. Visitors will be able to see the instruments being played on video screens and hear them over headsets that pick up signals near the displays. In addition, the museum will include an auditorium, a conservation laboratory open for viewing, and a recording studio. The founders have already collected more than 1,000 ancient and ethnic instruments from all over the world. Curators plan to expand the collection to 5,000 instruments. See themim.org for more information.
German Investment to Test Solar Panels TUV Rheinland Group, a German product safety testing company, has created a joint venture with Arizona State University and the APS electrical utility to test and certify solar panels. The ASU Photovoltaic Testing Lab has tested around 2,500 solar modules since 1997 and has issued more than 250 qualification certificates. The partnership with TUV Rheinland will allow ASU to include safety certifications as well as certifications of performance. APS will contribute its five-acre, outdoor Solar Test and Research Center as the testing space for this new joint-venture. TUV Rheinland is the principal investor in the new company located near the ASU campus, just south of the Phoenix International Airport.	Genomics Institute Spins Off a 3rd Company The non-profit Translational Genomics Research Institute (TGen), located in downtown Phoenix, is fulfilling its mandate of spinning off private biotech related companies into the Phoenix area. MedTrust Online LLC, the third such spin-off company, was established in October. MedTrust Online provides oncologists with clinically useful applications and solutions drawing on recent research, including TGen’s genetic-based medical discoveries. The strategy of the company, which has raised more than $3 million of venture capital, is to link willing doctors and pharmaceutical companies to share information about new treatments, including those in clinical trials. The MedTrust Web site, medtrust-online.com, contains a database of medical literature, clinical trial information, treatment options and other data tailored for oncologists.
Nursing School Opens in Downtown Phoenix Fortis College, a vocational training company, opened a training facility on the campus of St. Luke’s Medical Center near downtown Phoenix in September. Currently its classes are limited to medical and dental assisting as well as medical billing. But Fortis intends to gain accreditation from the Arizona State Board of Nursing for its nursing program in time to recruit 350 nursing students by September 2009. Fortis also plans to teach emergency medical treatment classes and to grow the enrollment to about 600 students. Fortis will offer certificates, not bachelor degrees in nursing, so the programs will range from 36 to 48 weeks. New students will enroll every six weeks.	Phoenix Firms Testing Airport Safety Systems The Federal Aviation Administration awarded two Phoenix companies a total of $9 million in November to further develop and test their aircraft warning systems. Current systems warn pilots about other aircraft on their runways using ground-based radars. But the two new systems use satellite-based monitors for pilots to track aircraft on the ground and in the air near their planes as they approach and depart the airport. Aviation Communications and Surveillance Systems (ACSS) received $6 million to test its system at the Philadelphia airport with 20 US Airways commercial planes. Honeywell Aerospace received $3 million from the FAA to test its technology at the Seattle airport with planes and pilots from JetBlue and Alaska Airlines.
Company Highlights	Upcoming Trade Shows
Barrel O’Fun Building Snack Foods Plant Minnesota-based Barrel O’Fun announced that it will invest $21.5 million to build a 135,000-square-foot manufacturing and distribution center on the west side of Phoenix. The company manufactures snack foods for retail stores, food service organizations, and private label customers. It bought 12.5 acres of land in Phoenix for $3.5 million and broke ground on the factory construction in October. The plant will serve the western United States and will employ 50 people initially and then grow to 100 employees over time.	International Reading Asso., Feb 21 - 25 More than 10,000 people are expected to attend the International Reading Association’s annual convention and exhibition scheduled for February in the Phoenix Convention Center. Exhibitors interested in giving presentations must apply by February 15. There will be 14 tracks of concurrent sessions about strategies and techniques for teaching literacy to adults, children, and non-English speakers. Teachers can earn continuing education credits by attending up to eight half-day conferences. See reading.org for details and to register.
Allied Waste Industries Merger Approved Phoenix-based Allied Waste Industries Inc, the country’s second-largest waste-management company, received Justice Department approval in December to merge with Florida-based Republic Services Inc. Allied Waste currently employs about 23,000 people and Republic Services employs another 13,000. Allied Waste is one of Arizona’s six Fortune 500 companies. The merger plan, approved by the shareholders, calls for the combined company to be called Republic Services Inc but to be headquartered in Phoenix.	Waste Management Symposium, Mar 1 - 5 Around 3,000 people are expected to attend the Waste Management Symposium and exhibition which will be held in the Phoenix Convention Center. The conference will focus on seeking solutions to the safe management of radioactive waste and radioactive materials. The annual WM conferences, now in their 36th year, draw people from throughout the world and provide significant opportunities for education, professional growth and networking - as well as business opportunities. To learn more about the conference and participation as an author, attendee or exhibitor at WM2009 in Phoenix, go to wmsym.org.
Honeywell Snags $4 B Gulfstream Contract Phoenix-based Honeywell Aerospace won a contract to supply turbofan engines for the new Gulfstream G250 jet, a deal that could earn Honeywell more than $4 billion. Honeywell will also supply the auxiliary power units for those Gulfstream jets, as well as the cabin pressure control systems, attitude and heading systems, autopilot systems, terrain awareness and warning systems and aircraft lighting. Honeywell Aerospace, one of the largest employers in Phoenix, already earns about $12 billion per year in revenue.	Independent Community Bankers, Mar 18 - 22 More than 3,500 people are projected to attend the Independent Community Bankers Association (ICBA) conference and exhibition at the Phoenix Convention Center. The conference will offer eight education tracks as well as an exhibit hall. According to the ICBA Web site; “As the largest, most comprehensive event of its kind, ICBA's annual convention, offers more than 70 educational opportunities, showcases more than 240 exhibitors and hosts Washington's top policymakers, making it a must-attend event.” See icba.org/conference for more information.
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