Henninger: Southbridge Superior Court ruling is no win for Scottsdale

Unless you are a fan of no-growth, no-change in downtown Scottsdale there is no reason to cheer what happened last week and the potential effects it will have on the city moving ahead.”

Don Henninger

In recent days we’ve seen the devastating ripple effects that fear can have on a community.

It can shut down economic activity with both short- and long-term effects.

It can show what happens when people listen to the advice of leaders who play fast and loose with the facts.

It can erode trust in systems and processes that are usually consistent and reliable.

This all came to mind late last week when a Superior Court judge ruled against Southbridge 2 in downtown Scottsdale, allowing the citizens referendum opposing the project to move onto the November election ballot.

Southbridge 2 opponents compiled enough signatures to void the City Council’s approval of the project, ending many years of negotiations between the Unger family and city staff to launch a development on land south of the canal owned by the Ungers that adhered to city codes and would deliver an array of benefits to the core of the city.

--- Don Henninger

The run-down area of the project now produces $400,000 in taxes; Southbridge 2 would take that amount to $4 million. It also would provide $3.4 million in new public parking and nearly one-third of the development would be open space.

If the decision stands after a potential appeal, the November election issue is irrelevant. The project will be shelved as the financial foundation of the project unravels over delays and uncertainties --- the two biggest threats to economic progress.

Unless you are a fan of no-growth, no-change in downtown Scottsdale there is no reason to cheer what happened last week and the potential effects it will have on the city moving ahead.

Southbridge 2 brought first-class design, a variety of extra amenities not normally included with such projects and support from the vast majority of shop owners on Fifth Avenue who are fighting to stay relevant. The Unger family, which also owns that land, had plans to upgrade those properties and give them a fighting chance.

If the referendum stands, the Ungers will have little choice but to sell the land to other companies that likely will propose inferior multi-story apartment complexes and bare minimum amenities if any at all. If lower apartment buildings are built, no open space or additional public parking would be required.

And that’s all assuming other developers are willing to move into the picture.

Investors throughout the southwest have been watching this case closely, weighing the pros and cons of attempting projects in the city. Even before this latest decision, at least three quality developers pulled out of projects planned for downtown. Why? Delays and uncertainties.

The last three Planning Commission meetings have been canceled. Nothing was on their agendas. The city is losing quality projects to Gilbert, Chandler and downtown Phoenix.

Scottsdale is 184 square miles. Downtown is roughly one square mile.

Southbridge 2 would have occupied one-tenth of one square mile. Southbridge 2, opponents said, would destroy the character of the city, even though it is not in the boundaries of “Historic Old Town,” and they convinced enough of fellow citizens to buy into that claim and sign their petitions.

Fear makes for good drama but can have devastating effects on a community.

The COVID-19 pandemic will have an enormous impact on the city’s tourism industry and its economic health --- tourism is the major source of sales tax revenue, which keeps property and sales taxes low. No one knows yet how deep it will go or how long it will last.

The last thing the city needs now is to make it harder to do business here.

It’s clear that those who use fears with little regard for facts do a disservice to the city no matter what the issue is. Keep that in mind as we elect a mayor and fill three council seats this November.

Editor’s note: Mr. Henninger is executive director of the Scottsdale Coalition of Today & Tomorrow and can be reached at donh@scottsdale.com