Metrocenter Mall developer to get $68M tax break in exchange for parking garages
Phoenix leaders will allow a developer to skip paying some taxes in exchange for redeveloping the former Metrocenter Mall.
Rather than pay an estimated $67.8 million in sales taxes on construction, leases and retail, the developer will build up to nine public parking garages on the 80-acre site. When construction is done, Phoenix will own the garages with revenue going to operation and maintenance and the developer. Once the garages are paid off, Economic Development Director Chris Mackay says they’ll generate revenue for the city.
“We can charge for parking, a future council could choose to sell the garage and monetize the garage at that time — that would be for a future council to decide what they want to do with that publicly owned asset,” she said during Wednesday’s council meeting.
Councilman Jim Waring summarized the deal this way: “Taxpayers aren’t on the hook for running it, people who park there are on the hook for running it — or paying for it, it’s pay as you go — and then when there’s spillover, it goes to the developer to pay them off for building it and at the end we have a revenue-generating asset."
A mixed-use project will be built in three phases off Interstate 17 at Dunlap. The latest details provided to the city say at full build-out, the former mall should be home to a public greenspace, 2,800 multi-family housing units and 383,000 square feet of commercial space.
Project timeline as of May 2022
- Summer 2022: Developer completes real estate transactions to acquire site.
- Winter 2023 to summer 2024: Demolition of former Metrocenter Mall.
- Early 2023 to late 2025: Commence construction of Phase 1.
- Early 2025 to summer 2029: Completion of Phase 1.
- 2025-2027 to summer 2032: Phase 2 construction and completion.
- 2027-2029 to late 2035: Phase 3 construction and completion.
- 2029 to late 2035: Completion of all phases.
- 2054-2060: End of city reimbursement of garage/amenity costs.