Two new business hotels planned for Riverwalk

Posted By Mike Padgett

Oct. 16, 2008

The developer of one of metro Phoenix’s high-profile projects, despite a historic plunge in international market conditions, remains committed to two new hotels in its expansion plans.

The hotels are planned at Riverwalk, the commercial, retail and office development on 187 acres of land leased from the Salt River Pima-Maricopa Indian Community just east of Scottsdale. Riverwalk is on the east side of Loop 101, between Via de Ventura and Indian Bend Road.

Work is to start in January on a 101-room Hampton Inn and Suites, said Kurt Rosene, Senior Vice President of The Alter Group, the Riverwalk developer.

Then 12 months later, work is to start on a 115-room Homewood Suites. The hotel developer is HCW Scottsdale LLC, Rosene said.

The hotel plans remain on track because The Alter Group, like other developers, remains optimistic about the region’s potential and its historical growth patterns, Rosene said.

The state is popular, veteran economists say, partly because Arizona’s Sun Belt status gives it an edge over other regions where residents struggle with snow, floods, tornadoes, hurricanes or earthquakes.

Although nothing in real estate is bulletproof, especially when the economy is stumbling, Rosene said the two hotels remain on track because their financing has been in place for some time. He says that even in rocky economic times, “the extended-stay (hotel) products all still do very well.”

The Riverwalk development’s existing three buildings are landscaped with a water feature that includes a waterfall and a meandering stream.

Rosene added that he’s been in talks with more retailers interested in about 40 acres at Riverwalk. The companies include high-end fashion outlets, entertainment venues, and furniture companies that want to be close to the Arizona Design Center, which is open only to the trades. He also is requesting approval to expand the design center by 60,000 square feet.

Rosene is negotiating with an international company interested in 50,000-square-feet for its headquarters. Paper work for that proposal has been submitted to the Indian community for review. He also is talking with “a couple of different delis” to move into Riverwalk.

At buildout, Riverwalk will have 1.25 million square feet for offices and 750,000 square feet for retailers and other tenants. To date, the development has three buildings with 310,000 square feet in offices and 140,000 square feet in retail and other uses.

Rosene said proposals for two more three-story buildings, each with 100,000 square feet, have been authorized. Lease talks on the proposed buildings have started, but they have not reached the level justifying construction.

“If we get them significant preleased, then we can pull the trigger and add some more office buildings,” Rosene said.

Riverwalk’s first building was the Arizona Design Center, open to interior designers, not the public. The ADC tenants include: Alexander Sinclair, Century Furniture, David Adler, Dean Warren, Ebanista, Floors, Fremarc, Horizon Art, Inside-Out, Kravet, McNamara & Hirschman, Pacific Manufacturing, Pindler & Pindler, Trappings, and W.F. Carter

The Indian Community, equally optimistic about the region’s future, is adding a Casino Arizona Resort & Spa, a 497-room, 15-story hotel with a new casino and convention center east of Loop 101 on Indian Bend Road. Construction started in late 2007. Completion is set for early 2010. The contractor is Chanen Construction Co.

“It’s going to be a great amenity right across the street from us,” Rosene said of the new casino, hotel and convention center.

The new Casino Arizona Resort & Spa, according to its Web site, will offer:

• A 240,000-square-foot casino with 998 slot machines, more than 50 poker tables, 50 or more blackjack tables, a keno lounge, and off-track betting.

• Several restaurants; eight, according to one industry source.

• 10 entertainment lounges.

• A 750-seat showroom.

• A 13,000-square-foot luxury spa.

• A 50,000-square-foot convention center with 21 meeting rooms and another 50,000 square feet of outdoor space.

• A 24,000-square-foot ballroom.

• A 10,000-square-foot showroom.

Rosene said Casino Arizona recently became one of his Riverwalk tenants. The casino’s marketing and sales group for the convention center built a mock hotel room inside Riverwalk.

The two business class hotels planned at Riverwalk will be a complement to the casino hotel “because not everybody wants to stay in a casino” hotel, Rosene said.

Oct 16th, 2008

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