Mesa council approves groundwork for $3B mixed-use development

An estimated $3 billion private investment that will bring apartments, hotels, restaurants, commercial businesses and public spaces to southeast Mesa has cleared major hurdles.

On Monday, the Mesa City Council unanimously passed a package of ordinances and resolutions that will provide a jumpstart to the Legacy Park and Gateway Crossing Project at State Route 24 and Williams Field Road.

“I’m excited for this coming to southeast Mesa. It’s going to create an ecosystem out there that’s really unprecedented for that area, and with the visitors to the (Arizona Athletic Grounds), our Gateway Airport and the extreme growth that we’re going to experience out there, this is just a huge asset,” Mayor Mark Freeman said after the vote.

In all, the council approved the annexation of 196 acres, known as Legacy Park, at the northeast corner of South Ellsworth Road and East Williams Field Road, and 5 acres within what is known as Gateway Crossing at the southwest corner of East Williams Field Road and State Route 24 in Maricopa County.

The council also voted to rezone the 196-acre parcel from light industrial to planned community district. Council action also created a special taxing district, Legacy Park District.

Finally, the city entered into a retail development tax incentive agreement that will reimburse developers Vestar, Pacific Proving and Mesa BA Land more than $76.4 million in construction sales tax, retail sales tax and transient-lodging tax generated by the project for certain public infrastructure.

“Rarely does an opportunity arise to develop a generational project that can really define a community’s identity,” David Larcher, president and CEO of Vestar, told the council. “That opportunity is what we have with Legacy Park. It’s the right location, it’s the right time, and we’ve got the right project to accomplish this.”

Legacy Park is expected to have more than 2,000 dwellings and 6.7 million square feet of non-residential floor area, according to a staff report.

“The proposed project provides for an initial phase of mixed-use development that will create a core of uses such as commercial entertainment, retail sales, restaurants, multifamily residential, and parks and recreation facilities,” the report stated. “Additional permitted uses include hotels, business and professional offices, medical and dental offices, personal services, research and development, and other uses consistent with the general plan.”

One key development of the project is The Boulevard, a mixed-used pedestrian area with a main corridor and cross extensions that provide pedestrian connections through paseos, plazas and open space.

Plans also call for the Legacy Link, a pedestrian tunnel connecting Legacy Park, Gateway Crossing and the Arizona Athletic Grounds.

The developers will also be building a 20-acre public park with trails, seating and shade that will include an approximately 10-acre lake. The developers must obtain their type 2 groundwater rights to fill, refill and maintain the lake and landscaping “that are separate and distinct from the city’s water and the city’s water system,” the report continued.

“(Developers) are developing the park and the lake. They become eligible for reimbursement through a number of conditions and requirements … but they’re fronting all the money to build the park and the lake and all the other public infrastructure,” City Attorney Jim Smith said.

To be eligible for the reimbursement, the developers must:

• Start construction of Legacy Park’s minimum public infrastructure, minimum private improvements and the Gateway Crossing minimum private improvements no later than Dec. 31, 2029, and complete construction by Dec. 31, 2034
• Convey eligible Legacy Park minimum public infrastructure to the city by Dec. 31, 2034
• Open the luxury hotel to the public by Dec. 31, 2035
• Enter into a maintenance agreement with the city in which developers are required to maintain a portion of the public infrastructure in perpetuity at no cost to the city

According to a financial analysis by Applied Economics, the project is estimated to generate more than $7.4 billion in total economic output over 30 years with the minimum improvements and up to $58.8 billion at full buildout.

Between 2029 and 2065, the project is also expected to generate new economic activity and gross city tax revenue totaling $545.1 million if only minimum improvements are constructed. The revenue is estimated at $1.4 billion if it is fully built out.

In terms of jobs, the analysis stated that the project would directly and indirectly support an estimated 1,687 jobs with the minimum improvements and 13,511 jobs at buildout.

Reimbursement funds will not come from taxes generated in other areas of the city.

“The reimbursement will only be paid during the reimbursement period and, if the project fails to generate enough funds to cover the entire cost of the public infrastructure reimbursement before the expiration of the reimbursement period, developers will not be entitled to any additional reimbursement,” according to the staff report.

Janet Perez can be reached at jperez@iniusa.org. Please send your comments about this article to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines.