In Phoenix, Land of Sprawl, a New Focus on Old Buildings And Local Entrepreneurs

Amy Cortese | June 26, 2015


Picture Phoenix, and an image of urban sprawl, gated communities and strip malls may come to mind. But lately, a new kind of development is taking root that emphasizes preservation, urban infill and local creativity. And it’s transforming Phoenix from poster child of sprawl into a model of adaptive reuse that is creating vibrant, walkable neighborhoods where independent businesses thrive.

That spirit was on display at the recent Business Alliance for Local Living Economies (BALLE) conference, a gathering of localists and independent business owners from across the country. The choice of Phoenix as the host city may have surprised some attendees. But a pre-conference tour of some of the city’s “adaptive reuse” efforts dispelled old perceptions and showcased local businesses, from artisanal food purveyors to tech startups, that would be right at home in Brooklyn, Bellingham or any other Millennial-magnet city.

The 1920s era Luhrs Tower
The 1920s era Luhrs Tower

Phoenix is certainly not the first city to embrace adaptive reuse, which breathes new life into old buildings rather than tearing them down. Ghirardelli Square, developed along the gritty San Francisco waterfront in 1964, was the first major adaptive reuse project in the U.S. Other well-known examples include New York’s Meatpacking District and Philadelphia’s Callowhill, where abandoned factories have been turned into airy lofts. Young, creative professionals flock to these areas.

Phoenix is something of a latecomer. Prodded by Kimber Lanning, a small business owner and the director of Local First Arizona, a statewide nonprofit whose mission is to support independent businesses, city leaders launched an adaptive reuse pilot in 2008. The first nine developers to use the program saved an average of 4.5 months and $16,000 each.

Since then, the city has expanded the program, eliminating the red tape that bedevils redevelopment projects, providing financial incentives and offering a dedicated support team to qualifying developers. To date, more than 100 buildings have

Kimber Lanning
Kimber Lanning

been saved and reborn through the program. “It’s transformed the landscape and the entrepreneurial energy for our city,” says Lanning.

By her count, 80 new businesses have been created in the city center over the past several years.

The about-face has surprised and delighted Lanning, who says that this kind of support would have been unthinkable even five years ago. “They just wanted someone to buy it and tear it down,” she said. But Phoenix, like other cities, is adapting to broader demographic and cultural shifts. “The world has changed. What is desirable now is different,” says Lanning. And if Phoenix wants to be competitive, it must change, too.

Bringing Together a Community

The tour started in the Warehouse District, a neighborhood of low-lying industrial buildings just south of downtown Phoenix. Many of the historic buildings had been razed to make way for parking lots and a sports arena, and the area was a dead zone. But helped along by the adaptive reuse program, developers and architects are reimagining the remaining structures and drawing a creative crowd to the area.

Take Web PT, a fast-growing tech startup that provides physical therapy management software. It looked at more than 100 spaces before settling on a renovated building in the Warehouse District. “We wanted a space that matched how we do things as a company,” said Brad Jannenga, who cofounded the business with his wife, a physical therapist. That includes a commitment to health, community and a sense of fun, evident in the cocktail-themed conference rooms and whimsical décor.

The building, says Jannenga, “is bringing the tech community together, not just physically but as a community.”

Web PT displays it values
Web PT displays it values

Web PT is growing rapidly—it expects to grow from 250 employees now to 300 by year-end, and expects to reach 500 employees in a couple of years. So the company is now eying a move to a bigger 60,000 square foot space across the street in a soon-to-be renovated former grocery warehouse built in 1946.

From the Warehouse District, the tour moved on to Luhrs Tower, a 14-story neoclassical building in downtown Phoenix that once was filled with law offices. Its splendid lobby has been returned to its art deco glory, and all 500 wood-framed windows have been restored with the help of a historic preservation grant.

Phoenix’s light rail line—a 20 mile system installed five years ago—runs past the front door on 1st Avenue. Gradually, the ground floor bail bond stores have given way to hip tenants such as the Bitter & Twisted Cocktail Parlour. And the tower’s third floor houses a new startup accelerator called High Tide.

Bitter & Twisted in the Luhr's Tower
Bitter & Twisted in the Luhr’s Tower

“From lawyers to bail bonds to a tech hub,” marvels Billy Shields, a native Phoenician and partner in Hansji Corp., the building’s owner. He and Lanning point out that amid all the changes, the city is working to protect amid preserve traditional family neighborhoods in the area.

A short rail ride away, the Public Market showcases the leading role that agriculture plays in Arizona. The site of an old public market, it now hosts one of Arizona’s largest farmers markets, as well as a weekly food truck gathering. The open air market is run by Community Food Connections, a non-profit that supports small farmers and businesses in the area. The old Public Market building, meanwhile, has been restored and is now occupied by a popular café serving mostly local, organic food with a down-to-earth vibe.

Local food is also the focus of nearby DeSoto Central Market, which opened in April in a former DeSoto car dealership built in 1927. The building had since housed an antiques store and an advertising firm, but after a foreclosure it was owned by a bank and languished. The roof had almost collapsed and no one wanted to invest in it.

The city of Phoenix offered a grant for structural repairs that helped preserve the original wood roof and buttress it with steel. The developers were also able to use historic preservation tax credits. “We leveraged anything we could think of,” says Bob Graham, an architect with Motley Design Group, which oversaw the project. The original plaster walls were saved, their patina adding an antique charm to the space, and materials were reused as much as possible.

The Old Public Market Sign
The Old Public Market Sign

Today the DeSoto Central Market (pictured in main photo above) hosts a dozen or so food stalls, an oyster bar bar, and coffee and juice stands. Umbrella topped tables dot the outdoor patio. A green grocer, baker and butcher are expected to soon join the mix.

Back on the light rail along the Central Ave. corridor, we pass a vast community garden farmed by refugees from around the globe that have settled in Phoenix. Hopping off at the Arts District, we head to a nondescript row of buildings that give little hint of the culinary creativity inside.

Lux Coffeebar, a hip refuge for Mac-book wielding throngs, would be right at home in Brooklyn. But when it opened a dozen years ago and by a young couple that wanted to roast their own beans, few would have guessed it would set off an artisanal wave in Phoenix. “A lot of Phoenix businesses have been incubated out of this coffee shop,” said Sloane McFarland, an artist and developer who owns the building. The idea, he said, was to create a “community gathering space and activate the neighborhood.”

Tempting treats at Lux Coffeebar
Tempting treats at Lux Coffeebar

Sure enough, the area has become a magnet for artisanly-minded entrepreneurs—helped along by the light rail line that stops a block away. Lux has moved to a bigger space next door, and today, award-winning chef Chris Bianco crafts pizza and focaccia sandwiches from Arizona-sourced flour and tomatoes in the original location, a former school for hair stylists.

The tour ended at Southern Rail restaurant—fortunately for attendees whose stomachs were beginning to growl. The southern-inspired restaurant is located in The Newton, a mixed-use concept housed inside the old Beef Eaters, an iconic Phoenix restaurant that closed in 2006. The restaurant serves locally sourced food, down to the beer, wine and olive oil. Next door, at the Changing Hands bookstore, the bookshelves are made out of dining tables salvaged from Beef Eaters. The bookstore also serves beer, wine and coffee in its adjacent First Draft Book Bar.

Phoenix Light Rail
Waiting for the train

In an unusual arrangement, the developer, Venue Projects, invited the two tenants to become co-owners in the Newton project. It’s a partnership, rather than an adversarial landlord-tenant relationship. The project was funded in part by a local bank.

Over a lunch of catfish po’ boys and local barley salad, Lanning took a few moments to reflect on the transformation she helped bring about. “We were the epitome of a sprawled out, unsustainable city,” she says. “We have a long way to go, but the amount of work that has taken place in the last five years”—the 80 new businesses that have opened up in the city center, the $5 billion in investment along the light rail line—“is impressive.”

A new generation wants walkable cities and diversity, she added, but starting from scratch is not an option. “So the question is, how do we bring sustainable, pedestrian-friendly development to a car-dominated place?”

To the surprise of some outsiders, Phoenix is pretty far down the road in figuring that out.

Kimber Lanning will be speaking about the Adaptive Reuse program at the International Economic Development Council’s annual conference in October.  

For more adaptive reuse photos from Phoenix, see the slideshow on our home page.



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