(Unedited) Podcast Transcript 451: Supporting Local Culture Through Development
This week we’re joined by Phoenix community builder Tim Sprague. We chat about supporting local culture through development projects and the importance of sustainable development and transportation.
Today’s podcast was produced in partnership with Mpact. To learn more about the annual conference, visit http://mpactmobility.org
To listen to this episode, visit Streetsblog USA or find it in our archive.
Below is a full unedited AI generated transcript:
Jeff Wood (1m 57s):
Tim Sprague. Welcome to the podcast
Tim Sprague (1m 58s):
Thank you much.
Jeff Wood (1m 59s):
Thanks for being here. Before we get started, my first question to you actually is, are you staying cool?
Tim Sprague (2m 4s):
Am I staying? Cool? Wow, you would not believe it. I’m gonna look at my watch here. It says 1 14, 1 14 outside of Phoenix. Yeah, it’s a, it’s a little toasty here. It’s funny, I was speaking with a friend. We’ve paid for this because May and June were delightful. Ah, yeah. Yeah. They really were much cooler than normal, so we’re having to pay for it now. But you know, you live here long enough. You get used to it. I’ve heard
Jeff Wood (2m 27s):
That before, but that’s hard to believe. I mean, you know, you have new records for being over 110 degrees. You all just set a record last night for the highest low of 97 degrees.
Tim Sprague (2m 37s):
The highest low of 97. We’ve had a, I think it’s 19 days over 110. Oh my gosh. But, and don’t let anybody tell you that there’s climate change going on, because I don’t think so.
Jeff Wood (2m 48s):
Well, before we get started with our main discussion, can you tell us a little bit about yourself?
Tim Sprague (2m 52s):
Sure. Originally from Oklahoma, I’m a big time Oklahoma, sooner fan. Oh no, I am. I am. Ho Longhorn. There you go. Go horns. Yeah. So I have spent many an October weekend in Dallas, Texas watching games. So you know what that’s like. Absolutely. Grew up there. Went to college at Oklahoma, went to law school there. Practiced law in Dallas for several years, and left Dallas and came to Phoenix to join my father-in-law in the development business. And truly, I left the law practice ’cause I was tired of solving other people’s problems that I wanted to solve my own. And I’ve always been around the creative side of things.
Tim Sprague (3m 32s):
I play in a rock and roll band. I’m very much into art and those kind of things. And being a developer allows that creative part of me to come out. So I joined my father-in-law and unfortunately discovered he had leukemia literally three days after I moved here. And he died two months later. So I was thrown into the deep end of the swimming pool in Phoenix, Arizona. He had four Canadian partners from the Edmonton, Alberta area that I basically took over a very small operation that his, that his admin assistant and a salesperson that was selling the condos that we were building. We had just right at the end of completing one project had just broken ground on a second one. And I was thrown at the, the front of the wheel.
Tim Sprague (4m 16s):
And thankfully the Canadian partners liked me and I liked them and the rest is history. So we have gone on from there. And evolution has happened through the company that we’ve had. My brother-in-law, who my wife’s brother and son of the gentleman that passed is my partner and has been since the early eighties. Came in and joined me when he got outta school. And we’ve been together ever since. And our company, habitat Metro, was actually established back in 2004, I believe. That was an offshoot of our company, Sprague and Hill. His name is John Hill. And Habitat Metro was established to focus upon downtown infill type development. And in 2003, we became involved in, responded to an R F P from the city of Phoenix to develop a piece of property that was on the Light Rail that had been announced in Phoenix.
Tim Sprague (5m 8s):
And at that time, light Rail was just, you know, nobody’s really heard of it. And the reason why we were excited, we did two projects up in Portland, Oregon and a suburb called Lake Oswego. And we heard about this concept called Light Rail when we were up there doing those projects. But we finished them and ended up sell selling them and went back to Portland to visit and were blown away by how transformative Light Rail was for the city. And so we said, well, okay, if Phoenix is really going to do this, we’re in. So we applied for, responded to the R F P and we’re successful and built our first project on Light Rail, which is called Portland Place, which is a condominium project that is built overlooking a 32 and a half acre park that’s called Hans Park, where Interstate 10 goes through the middle of Phoenix.
Tim Sprague (6m 5s):
And the original plan that Adot, the Arizona Department of Transportation and the federal government had, was to build this huge freeway going through the middle of town, literally tearing the neighborhoods apart, displacing 250 historic homes with an above ground overpass. Homeowners association called the Roosevelt Action Association, was formed by the neighbors. They fought it. And the compromise was to depress the freeway below GR and create this 32 acre park by a series of 19 bridges side by side. And the person that negotiated that compromise was the mayor at the time, a gal named Margaret t Hans, who was quite a gal.
Tim Sprague (6m 48s):
And it pulled it together and it worked. And we built the first project of high end overlooking that part next to Light Rail.
Jeff Wood (6m 57s):
That’s awesome. So
Tim Sprague (6m 59s):
That’s a long story to get to you where I am today. We’re still doing infill development, but yeah, the influence for us, truly for what we do today in infill was what we saw up in Portland, Oregon and how transformative Light Rail was for that.
Jeff Wood (7m 12s):
Well that’s interesting. What did you see in Portland? Is there anything specific we all hear about Portland? You know, we talk about transit and development.
Tim Sprague (7m 18s):
Yeah, well the Pearl District up in Portland, if you ever were in Portland before the Pearl District, it was not a place that was desirable. I mean, completely turned things around. Interesting. My father knew a gentleman that his family had a chain of furniture stores up in Portland that I, I knew him. And one of his stores, one of the least profitable stores that they had was in an area that they were really thinking about shutting it down. Light Rail came along and it turned out to be one of their better stores. I mean, it’s really amazing how transformative good transportation can be. We saw that and we’ve always had an affinity for downtown and hopefully that it would become something cool, if you will. And Light Rail came in and when that was established that it was really gonna happen, we were in.
Jeff Wood (8m 3s):
That’s really interesting. We’ve talked about the Pearl District and the freight yards that used to be there and the streetcar and all of the development that’s happened there. But let’s talk about Phoenix a little bit. I wanna know a little bit more about what Phoenix means to you and how you reflect the city of Phoenix in your development projects.
Tim Sprague (8m 17s):
Well, I moved out here in the early eighties. And at that time, downtown Phoenix was truly a suburban city. The downtown area, the urban area had really been abandoned. The large department stores had all moved out. Everything had gone to the suburbs at that time. And it was, it was hurting. I mean, no question about it. The first, I like to call it the big rock that was put in the jar, if you will, to help out was the, the Suns Arena where the Phoenix Suns play. And then the next big rock was the baseball stadium for the Arizona Diamondbacks. And then at that point the convention center was starting to be redone and things had started, but you had all the great big rocks, but none of the smaller stuff, you know, I like to say the grains of sand that come in around that in the jar and really provide the activity, provide the environment, provide the culture that lures people there.
Tim Sprague (9m 9s):
Well, a group of us around downtown, when we put our stake in the ground to do the R F P for the Portland Place Condo project, there was a group of us that were really into good music, really into art and wanted to try to create a downtown. And literally over the last 15 years plus it’s happened. It’s worked. And it’s because of really a neighborhood, the Roosevelt Action Association that I told you about, of those folks being devoted to the park that was in their neighborhood. The park was dedicated in 1992 with a lot of grandiose things that were supposed to be there.
Tim Sprague (9m 49s):
The city and the state ran out of money, they did put the green in. It’s nice. But that’s it. And we’ve renovated the park. I was head of the Han Park Conservancy to help get that done. And we’re in a process of that renovation project. So that’s happening. And the other thing in downtown is that, is there is that these are the local folk, these are the restaurants that are the local people that have come in. They’re not chains. The arts district is right at the corner of Central and Roosevelt, which is right where our projects are located. It’s thrived. The Arts District Light Rail Stop is one of the most traveled ones on the circuit. And downtown has just evolved. It give you a sense of how much change has taken place within the miles circuit of our park and where our projects are located.
Tim Sprague (10m 36s):
At the end of 24 14, there were 5,900 people that live within that mile radius. Four years later, that kid had exponential growth. It’s a little over 12,000 folk. And if you take that night, that 2018 number projected out today, we’re probably about 23, 20 4,000 people within that same radius now. And that kind of activity’s taking place very quickly. And the other thing that took advantage of Light Rail, which was very, very smart, was Arizona State University, putting a downtown campus in Phoenix. And very quickly, literally in like three or four years, Arizona State has a population at that school at 15,000 kids. It’s on the light.
Tim Sprague (11m 17s):
Rail connects to Tempe or the main campuses in it brought a great deal of life, that part of the world.
Jeff Wood (11m 22s):
Tell me a little bit about the history of Roosevelt and Roosevelt Rowe, because it has a really deep history in Phoenix.
Tim Sprague (11m 28s):
Sure. It really became the place where artists gravitated to because rent was cheap. It was an area that the artists had kind of been around. There were some galleries, not of any significance, but started to come out. There’s a gal by the name of Kimber Lanning close friend who started that operation, this nation that she’s very involved in, in a state level called Local First. And it was to promote local retail. She has an art gallery there. And a good friend of mine sold her the building so she could have a presence and put a stake in the ground for a long time. And there’s four or five other people that are around that area at Central and Roosevelt that have been around the art community.
Tim Sprague (12m 10s):
And he have put, art galleries have been involved in helping people with the restaurants get started in entertainment. Now there’s a jazz club called the Nash that is in that area. And they have, they have more jazz productions than any other place in the country, if you can believe that. And the arts are there. We have a hotel that we renovated, an old Best Western that’s just right off that intersection. It’s called the Foundry and it’s spelled F O U N D R E. We wanted to change the noun into a verb. And the re is our, is our signature of, you know, this is where you come. And it’s an arts boutique hotel. The hotel itself is a gallery.
Tim Sprague (12m 52s):
All the art that’s on the wall transitions three times a year and it’s all for sale and 104 keys and a great restaurant called Match that is fun. It’s got a market to it and it’s at one of the local spots. The town originally had its first shopping center. When I say the town, I mean the town Phoenix has a town had its first shopping center on Roosevelt in 1923. And it was considered very far outside of town. To give you an idea what the context is today, our downtown, our old downtown redevelopment area map goes up to Roosevelt. So it goes from the outskirts of town to the center of town in terms of what’s there, the amount of development going on downtown is phenomenal right now.
Jeff Wood (13m 38s):
It sounds amazing. And 24,000 people is quite a few. And I imagine that kind of brings up some tensions too, in terms of development, the potential for displacement, those types of things. I’m wondering, you know, kind of what bringing that amount, amount of people into a space means for the area and for the folks that lived there before and people that live there now.
Tim Sprague (13m 56s):
Well, it’s a really good point and I will tell you that the Roosevelt neighborhood is very unique. The concept of not in my Backyard, was not part of their vocabulary. The Roosevelt neighborhood realized that this was a way for a rebirth to take place for Renaissance to take place. And the Roosevelt neighborhood, all of us literally went out and put out the flag saying we’re open for business, come and talked to us about developing in our neighborhood, we’re very pro development, but pro good development. Making sure that the neighborhoods were respected and making sure that the questions were answered from the neighbors at the time that we did things.
Tim Sprague (14m 36s):
I mean, as I said, we were the first folks to do anything of any size around lot like Rail. I mean, I literally had my renderings and my coffee thermos go door to door on Saturday morning talking to folk, telling ’em what we wanted to do and listening to them. The best story I can have is that we were asked to give a presentation at a neighborhood meeting that took place in August, if you can imagine, outside of this park. And they were, they wanted us to come and make the presentation. I’m there as hot as it can be, it’s six 30 at night, I’ve got my renderings. We get through good questions, were asked, and I was trying to respond to most of them. And I’m a firm believer in doing it myself rather than hiring a lawyer to come in in a suit to do that.
Tim Sprague (15m 17s):
’cause I’m the person that can answer the questions and ask questions at the end of it, they were going to have a meeting to talk about the neighborhood home tour for the Roosevelt neighborhood. And I asked if I could stay and we did. And there’s an old shopping center that I told you about in 1923 that was built that’s called the Gold Spot that was just being redone by some folks that I know. And they were gonna have that be the headquarters for the home tour. And they wanted to put a bar there. It was vacant space and they needed some volunteers while I worked my way through law school attending bar. So I raised my hand and I became a member of the neighborhood. And so I got to know most folks from the right side of the bar, if you will, and got involved, became a member of the Roosevelt Action Center board and was termed out after six years.
Tim Sprague (16m 1s):
And we’ve been very involved in the neighborhood ever since. So for a neighborhood that is old, trying to have a rebirth and renaissance, the flag was put out a welcome flag, if you will, to come in and let’s develop. And as a result of that, I think a lot of things that would’ve been difficult to do worked. But what I’ve learned, and I think most people have learned in doing work in an infield environment, you have to listen. You have to really make sure that you hear what the neighborhood’s like today. ’cause you’re gonna change it. And they know what the important things are and what things you have to look out for. And every time you can find an idea from theirs that is great, celebrate the heck out of it because they know what’s going on.
Jeff Wood (16m 45s):
What did you learn behind the bar? Is there anything that came up? Yeah,
Tim Sprague (16m 49s):
Yeah. No, truly, I learned that art was really important to them. I learned that their values were to have a neighborhood where they could walk to entertainment, where they could walk to dining and it would be safe. And at the time that we were looking at this as a possible deal to do all of our contemporaries here in town, our pillars told us we were nuts for doing a project like what we were doing in downtown. We were getting ready to set the high water mark for condo prices per square foot on the project that we were doing. They were 2 450 to $500 a square foot. And at that time that was very high for anything related to downtown.
Tim Sprague (17m 31s):
And my partner and I said, you know, damn the torpedoes light rails here, we saw what happened, we think it’ll work. And we had a great location overlooking this part and it worked. We sold out all the condos before we finished. So the neighborhood is very interesting also from a demographic standpoint. Older folk, younger folk then get into the value graphics of, you know, what’s interesting to them? Politics are across the board, but they really wanted to keep and create a neighborhood that was what they wanted. And everybody got involved and they still are involved. Very much so.
Jeff Wood (18m 8s):
The hotel project you mentioned was interesting too, reading about it because it wasn’t just trying to redevelop something and then sell everything to the highest bidder. You actually wanted a mix of folks living there and that was targeted, I imagine.
Tim Sprague (18m 21s):
Well, it was, it’s interesting because the land that we acquired to build our condo projects was acquired from the city of Phoenix. It was leftover remnant land at the time that the imminent domain action was taken to get rid of the 250 historic homes and put in the freeway that went through the middle of town. And this was remnant space that was there. And when they created the park with the bridges, this was space that was literally next door contiguous with the park. And so we got that and at the end of the block on Portland Street next to Central was this old Best Western that had been avoided at the time that they did the eminent domain map, if you will. We did not know that it was up for sale until after a woman had bought it.
Tim Sprague (19m 5s):
We had a serious investment, we, you know, 120, $130 million worth of development next door. And we wanted to make sure that what was at the end of the block was something that worked. We had seen a concept we liked and it was down in Kentucky called 21 C Museum Hotel and went there, visited those folks and fell in love with what they’d done and said, let’s try to do something like that ourselves. So we bought the hotel and, and took us a long time to get it done, but we did, and it’s up and it’s running. It’s doing okay.
Jeff Wood (19m 35s):
That’s awesome. I feel like there’s projects like that all over the country. I know a number of them in South Congress in Austin and in a number of different places where, you know, old hotels become fabulous places to live.
Tim Sprague (19m 47s):
Yeah. But it runs as an operating hotel and it’s in a unique location. We’re literally right at the light Rail stop at the Arts district and we have a recurring event every month. That’s our first Friday art walk and it’s on the New York Times Top 10 recurring event. Literally even in this kind of heat, we’ll have 10,000 people out walking on the streets first Friday. And when the weather’s nice, it’s, you know, 15, 70,000 plus. It’s a great place to go. Now as a result of all this activity, we’ve got some great music downtown, it’s just down the road and friends of the place called the Crescent Ballroom, the Valley Bar and the Van Buren that are really class A music venues, they’re not large venues.
Tim Sprague (20m 31s):
Del Hode, 300 to 1500 folk Live Nation runs one of them and buddy of mine runs the other two. And it’s a great cultural spot.
Jeff Wood (20m 41s):
That’s very cool. You’ve done both high-end projects and conversions for artists and very sustainable projects. I’m wondering if developers typically vary their projects so much.
Tim Sprague (20m 51s):
They don’t and that’s probably why a lot of people ask me why my head hasn’t been examined, but
Jeff Wood (20m 58s):
Not me.
Tim Sprague (20m 60s):
Well we, we, my partner and I did a really fun project during the recession. First of all, during the recession there’s no money to do any real estate development. So you go out and see what you can do a lot of time on our hands. A friend of ours acquired a 99 room s r o motel called the Oasis. And literally it’s on Grand Avenue, which is an old highway that runs northwest through a diagonal through the middle of town all the way out to Wickenburg. And this is where the old motels were located back in the fifties and the sixties when people would travel west. This was one of those hotels and our buddy bought it and he did not know what he was doing.
Tim Sprague (21m 43s):
He goes, come in and help us. So we went there, John and I assisted, and his plan was to do affordable condominium sales and to turn it into condos. And he was going to carry the mortgage paper back himself as part of his estate planning. Well we got there at that time during the recession you couldn’t give away a condo, much less try to sell one. So I said, let’s do plan B. And plan B was to do affordable housing for the artist community that had located big time there. We did that, we turned the 99 rooms into 60 studios in ones and we learned how challenging it is to get financing to do affordable housing.
Tim Sprague (22m 24s):
I learned that it’s not a capital stack that you put together with equity debt. It’s a mosaic of wherever you can find money to make it work. Well, what we ended up doing worked nicely. It’s called a Oasis on Grand and we have 28 market units and 32 affordable units in it. And what we did is that we took the common area that would normally be like, where you’d have a pinging pong table or a pool table and we turned that into an art gallery. And this is, this place is filled full of artists and our website’s called Oasis on grand.com and you could do oasis on grand.com/ Wood and that would be your website for your Art Jeffrey.
Tim Sprague (23m 6s):
And Nice, it worked. We’ve had a waiting list there ever since we opened up. And the best part about it is, as I was at a community meeting when we were getting ready to do the project and the community action officer for the police department for the city of Phoenix came up to me and he says, are you Tim Sprague? I said, yes sir. And he goes, well, I just wanna say thanks. I said, what do you mean thanks? He goes, when you guys shut this place down, the crime rate in the area dropped by six 0%, 60%. And I mean, it truly was transformative. And this area now is, is really cool. And I mean it always was an art area, but I mean it’s, it’s safe. There is some really cool stuff being done there.
Tim Sprague (23m 48s):
There’s a container project that’s on granted, some friends did, and it’s a very innovative joint and it’s really fun to see this stuff happen.
Jeff Wood (23m 57s):
Another thing that you’ve done is projects that focus on sustainability. And I think that that’s a really important thing, especially now that you’ve, we’ve discussed at the beginning of the show the heat climate change and all those things. What types of features do some of those projects have?
Tim Sprague (24m 12s):
Well, we call it our eco program. We made a, a conscious decision three and a half years ago to have all our future development be very sustainable. And when I say very sustainable, that’s an interesting challenge. Building things sustainably is very expensive. It’s out of the norm. It’s difficult to find consultants, it’s difficult to find general contractors, different subs that are in tune with what you really want to do. So what we’ve done is that our goal is to try to build as sustainable as we can from an economic standpoint. We have two projects under construction now, one’s called Eco Phoenix that’s in the downtown Roosevelt neighborhood, right around the corner from our condo projects.
Tim Sprague (24m 53s):
And we have one in downtown Mesa, which is two years ago, I would say downtown Mesa was next. Now I say downtown Mesa is now a s u has a new presence there in their mix entertainment area, which houses the Sydney Poitier Film School, which is very cool. But what we wanted to do is to try to do those things that made sense. We have solar panels on top of both of the buildings. They’re vertical buildings that are five and seven stories tall. The footprint restricts how much solar energy that we can use to support, but we get as much as we can. We have a water catchment system on, on one of the buildings that we use to irrigate the landscape That’s at the grade level of the project.
Tim Sprague (25m 34s):
We’ve got a car share program we’re doing for both of the projects. One of the things we did is we’ve designed the projects from the inside out, so they’re very insulated. We use top grade materials, we try to avoid any kind of red line materials and the projects. Air quality’s great. We’re opening up the first one here next month. We second one will probably be later on in the fall. And it’s amazing. What we have found is that there are folks that literally will go out of their way to live in a sustainable billing. And what we’ve learned is that values really motivate folks to do things and people seek out things that are important.
Tim Sprague (26m 16s):
I was doing an interview the other day and somebody asked me, said, you know, why, why, why are you so involved in doing something sustainable? And I thought about it for a moment, I said, you know, I can answer that with one word. And the gal says, what’s that? I said, grandchildren. And yeah, yeah, I mean that I’ve been trying to learn as much as I can over the last couple years about how to do this. And I learned that I’m very, very, very much just a student and we have an awful lot to learn and I’m hoping that we can moment that we finished, we are willing to share whatever we have learned with anybody because we think this is what needs to happen. An interesting thing that we’re learning that I think our market, the multi-family market is learning, which really goes to what impacts all about.
Tim Sprague (27m 0s):
We really have to think about how we’re gonna charge EV vehicles. Where do you do that? How is it done? When do you do it? I was in a subcommittee at the mayor’s office this last year and you know, it’s interesting, you drive around to any class a apartment project in our town, and I think it’s probably the same across the country and people have late model cars, if it’s a, a market rate product that people are driving late model cars and look at what kind of cars they’re gonna be driving next year if they haven’t already transitioned. I think a lot of where you house, where you live is gonna be determined by how your transportation is being supported.
Tim Sprague (27m 41s):
And if you don’t have the ability to use public transportation or Waymo or Uber or whatever and you have to have a car, this is a big, a big part of your decision. So, and I, and I think it’s very, very difficult and expensive to retrofit an existing property. And so anything being built really needs to pay attention, I think, to how they’re gonna support their residents and their EVs.
Jeff Wood (28m 7s):
There was an article today or yesterday in the local paper, the Arizona Republic, about arguments over parking requirements there was related to transportation. And so I think that that is something that comes up a lot. There’s also an item, I think in Route 50, which is a, a national publication talking about, you know, rental properties and charging stations and those types of things. And here in San Francisco, I mean my house, I live in a 1892 old Victorian, and we don’t have a garage, it’s just at the street and on the street. You know, we don’t have a car, but my neighbors do. And so, you know, if they wanted to buy an electric car, then where are they gonna charge it? It’s an interesting conundrum that comes in cities where the city wasn’t necessarily built for cars in the first place.
Jeff Wood (28m 50s):
And obviously I would like people to take Muni and take Bart and and walk and bike and all those things, but the reality is that there’s a lot of folks that will use their cars and so That’s right. You know, how do you deal with that from a development perspective and a retrofit perspective, like you said, because I don’t know, do you run a cable underneath the sidewalk that’s 10 feet wide, which is a beautiful sidewalk, you know, how do you do it? It’s a question. I think that’s vexing a lot of people.
Tim Sprague (29m 15s):
Well, I think one of the things that we talked about in this subcommittee was, you know, going to employers, looking at where people work, looking at parking garages, looking at public parking garages. And you know, look at that. In our part of the world, the cheapest electricity really being produced occurs during the day because of all of the solar. We have a nuclear plant that does not have a rheostat on it, it, these are all on or all off. And you couple that during the day with the fact that we have a lot of solar here, energy’s cheap during the day. It gets expensive from four to eight when people come home and try to cool off. So really the most logical place for somebody to plug in and get a cheap charge is either during the middle of the night at home or it’s during the day at, at, at where they were before.
Tim Sprague (30m 1s):
Before. And so you’ve gotta come in and balance that out and see what makes the most sense and, you know, what’s the least cost to be able to retro.
Jeff Wood (30m 8s):
You mentioned car share in one of the projects and thinking about light Rail and access, maybe even micro mobility, those types of things. How much do you think about transportation generally? I mean, we talked about even electric vehicles and the the hoops that you’ll have to go to to try to figure out how to charge ’em. How much do you think about transportation in your work?
Tim Sprague (30m 28s):
A lot. A lot. We have three big items that are extremely important to us in terms of where we locate a property. Number one, transportation is very much key. The last thing I want to do is, is to promote the use of something that’s going to make our environment worse than it already is. And if I can build something with our partners that is next to transportation, public transportation, and do that and make it work, by golly, we’re gonna try our best to do that. And number two on the list is art. Be in an area where art is very prevalent, it brings in a type of person and it creates a community and an environment that naturally shares.
Tim Sprague (31m 11s):
You get a sense of community, people become very active in that and it leads to entertainment just because it’s a reason for people to come. And the last thing that’s very important to us is education. Being in an environment where people are learning and, you know, trying to become better is very cool. And it really sets a level in terms of where their values are and that’s something we want to cater to.
Jeff Wood (31m 36s):
What have you learned from first getting to Phoenix from Oklahoma to now? What are some of the major changes you’ve seen in yourself since that time that you, you showed up in Arizona?
Tim Sprague (31m 49s):
Well, that’s a really difficult personal question now. And, and let me give you an idea of something that really hit us in the face. Years ago when I moved here and we started doing development work, as I mentioned, we were working with four Canadian home builders, actually from the Edmonton, Alberta area. Great guys, I mean, unbelievably fun guys. And I can’t believe that they looked at, took this guy that was completely green and allowed him to come in and, and run their show. It wasn’t a big show, but it was a show. So what I learned is that going out and doing greenfield development and the outskirts of town at that time, our first project outside the, was different to what I was doing with the Canadians was in Chandler Chandler’s in the southeast part of the valley.
Tim Sprague (32m 36s):
And we were next door to an, to an Intel facility that had just been built and a master plan community called Gila Lakes. And it was typical Arizona suburban sprawl. And so we built 144 units there. Very cool. And the lender on that project was somebody that was out of Portland, Oregon, and that’s who brought us up to Portland. He said, Hey, I’ve got this deal up here. I’ve got one that I really would like for you to do and I need one that you can help me on. And one was a project was next to an office building they’d financed that had gone sideways. And so we came in and the other was a piece of property that was on Cruise way, if you know Portland at all, it’s a major street that comes off of Interstate five going east into Lake Oswego, neat piece of property, gorgeous wooded.
Tim Sprague (33m 29s):
And we got up there. And so we got up there, we liked this piece of property. It was owned by the l d s church, which was kind of interesting. But we bought it, we bought it from from them great folks to work with. And we were up there with that, man, this is great. We love Portland. Let’s see what else is going on. So we go out and we start looking at the price of property. And there was one line that if we went past that line, the price per dwelling unit was, it was like a 10th of what it was on the other side of the line. Well that was the restrictive area for services. And what I learned at that point is that how you get rid of urban sprawls to stop providing services past a certain point. And it made me really look at what we were doing. We came back to Phoenix after spending time up there and really fell in love with Port, but realized, you know, it, I I love the downtown in Portland, an awful lot of activity.
Tim Sprague (34m 19s):
And came back and saw what we had here and I said, you know what? That’s where we should be spending our time. And so the R F P came up that I mentioned for the first condo project when it was firm, that the light Rail was gonna come in. And we bought that and allowed us to do the second one. And we did the hotel and now we’re doing our fourth one around that area and community. Something that was around art, something around education, and definitely transportation. So what did I learn? I learned that the best thing that you can do in my business is to create community. I think you’ve gotta be careful in terms of what size the project is so you can establish a relationship with your neighbors.
Tim Sprague (35m 4s):
And we call that human scale. And human scale for us is having a project that’s not more than let say 150, 170 units and try to have as much commonality as we can find.
Jeff Wood (35m 17s):
It sounds like you created your own urban growth boundary.
Tim Sprague (35m 21s):
You know, we really have, I mean it’s very difficult for us to look at a project that’s not close to light. Rail just it, it really is. And I sit on a, on an advisory board of a, an entity called Arizona Housing Fund. We raise money to fill the gap for affordable housing projects that, that can’t get over that last step. They’ve put together the mosaic of money that I was telling you about that we did at, at the Oasis. And there’s always this little piece, a gap that’s out there that you can’t fund. And one of the things that’s happened at since Covid in the last couple of years is that the price of construction has escalated so quickly. We’ve had a, a blessing and a and a curse here.
Tim Sprague (36m 1s):
The Taiwan semiconductor company has a huge facility that’s being built here, a $40 billion project. And Intel has a $15 billion project being built on the other side of the valley. We have 5,000 people moving in here to our county every month. And Maricopa County’s been the fastest growing county in the country for the last two years. And it will be the, for three years in a row that’s phenomenal for our area. But we gotta be very smart about it. We’ve gotta make sure that we pay attention to what’s going on. But we have a huge, huge housing need right now. So this is a long way to say we need housing. We are lacking 270,000 dwelling units.
Tim Sprague (36m 43s):
We need a lot of affordable housing. And one of the things that’s important and why we look to build affordable housing without it having great transportation, you know, it’s only solving one part of the problem statement. And so you’ve gotta look at that. We look at that and it is not cheap, but that’s where you gotta go. I think
Jeff Wood (37m 4s):
It also makes things harder too. I I think, you know, one of the things that we’ve learned from looking at places like Los Angeles when you know the downtown or when a place becomes very popular and people get displaced, the people that relied on that frequent transit service that exists in downtowns and in central cities get, you know, displaced to places far out. And so what happens is they still rely on transportation that maybe they don’t have control over. And so it makes their lives a little bit harder. And I think that’s another kind of piece that I think that you understand, but I wonder if other folks get it that moving people out to the suburbs and out to the outskirts because of less expensive housing actually creates other problems for them going forward.
Tim Sprague (37m 44s):
Well, it does create other problems going forward. You know, at the time that we were all concerned what would happen if $4 gallon gasoline came into play? Well, it’s here, you know, and, and the people have moved out. The last thing we want to do is to create more cars, you know, build more highways. You know, let, let, let, let’s try to take care of it in a, in a rational way. It’s a serious issue about having redevelopment take place and having people displaced. It, it, it’s a challenge that we’re gonna have forever. Place gets popular, it gets cool, the artists can’t afford to be there, the people that are there, they have to go someplace else and they get displaced and all of the character and all the neat things that cause you to be there in the first place. They get replaced and they get replaced by things that maybe is cool or maybe not as cool, you know, instead of that, instead of that local Thai restaurant, you know, it becomes some chain.
Tim Sprague (38m 33s):
And I mean that that, that is persona agros for me.
Jeff Wood (38m 38s):
Have you learned anything from the pandemic and what’s happened downtown and maybe in downtowns around the country?
Tim Sprague (38m 44s):
Yeah, we made a decision at the time that we started designing Eco Phoenix to have larger units. And we did that because we’ve always taken the position that the best way to win is to be different. Michael Porter, the old Harvard B school marketing professor said, you know, if you try to do best all the time on a certain category, there’s one guy that comes in first, A gal that comes in second and a third person that comes in third. And the only way that you compete in that is to lower price. The way that you win and do something that’s quality is to build something different.
Tim Sprague (39m 28s):
And that’s to find something that is not the norm. And when all of the compression was happening in terms of the size of units, we said, you know, let’s create a place where you could work. Well, golly, I could say that that was prophetic, but it worked. And our units are a little larger. We have a place for people that put in a desk and literally to be able to work from home. And what I, what I’ve realized is that that is, we all know, you know, large employers are trying to get people to come back to the office and people are working from home. That’s that. And as a result of that, people have really gravitated towards their neighborhoods. And, and I, I just think that’s been a big difference, especially in urban areas.
Jeff Wood (40m 10s):
Yeah. Here in San Francisco it’s interesting because a lot of the neighborhoods have continued to be really strong and yeah, the transit ridership on those lines that goes north south, not to downtown, but north south is actually better maybe in some places than it was before. So there’s a lot of activity. Yeah.
Tim Sprague (40m 24s):
I’ve
Jeff Wood (40m 25s):
Got like maybe one or two more questions. Sure. So recently the governor vetoed a plan by the legislature to have separate vote on expanding the transportation sales tax. Yeah. And they separated out the light Rail idea from the, from major road building. I’m wondering what the impact of those arguments in that discussion is on the development community in Phoenix and future projects that you might want to pursue.
Tim Sprague (40m 46s):
The folks that understand what happened in the development community, people that are peers of mine that really understand good growth are very upset. Prop 4 0 4 was the one that was basically extending that there will be a big campaign or it is now to make sure that doesn’t go away. And I, I think we’ll win. It took us a long time to get that in place and it really helped to extend light Rail. I think we’ll win that battle, but it’s gonna be a battle. People that have their head on straight, I think can understand it. The city of Phoenix definitely gets it.
Tim Sprague (41m 26s):
We live in a very interesting state. We have a lot of rural areas that are very conservative and they have a great deal of say, inside our state legislature. I think that’ll change here in the next couple of years. But, and there’s been a change that’s been happening over time. The future of any state is going to be how well you deal with population growth and how well you deal with the amount of infrastructure that you build to try to support someplace that’s too far away from where the source is of whatever it is that you’re trying to supply. And being able to have urban planning in such a way that you capitalize upon concentration of fo and density is the best way to do that.
Tim Sprague (42m 14s):
And that’s what that, you know, tried to do. And I think it’ll come back around.
Jeff Wood (42m 19s):
You probably talked to a lot of folks about development, about the city of Phoenix, about all of these issues that we’ve been talking about. I’m wondering if there’s a question that you wish you were asked more.
Tim Sprague (42m 30s):
I wish that, not so much Phoenix, but just in general, we are not merchant builders. We are not people that go in and build something and turn around and flip it immediately. We like to establish community, we like to build community. And you know, the question is, you know, why you do that versus building something and, and selling it quickly. Probably would’ve made a lot more money over the years if I’d have done that. But I can tell you there’s, there’s nothing more fun than building a building that really turns into a community and getting to know the folk. And that’s as cool as it gets.
Jeff Wood (43m 11s):
That’s pretty great. Where can folks find you if you wish to be found?
Tim Sprague (43m 16s):
Well, they can go to our website, which is habitat metro.com. I’m available if they want to get in touch with me, they can do that. I’ll give you my email address. God knows what’s gonna happen. I
Jeff Wood (43m 27s):
I think you’ll be okay.
Tim Sprague (43m 29s):
Okay. My email address is Tim at habitat metro.com and I will tell you that I welcome conversation with anybody that is interested in development. And I, I’m welcome the opportunity to learn because I will tell you what one thing that I’ve learned over the years that I don’t know very much so still trying to learn.
Jeff Wood (43m 53s):
That’s why I do this podcast because I don’t know anything either. And so I wanna learn from other people like you. I appreciate it. Well, Tim, thanks so much for joining us. We really appreciate your time.
Tim Sprague (44m 2s):
Ah, you’re very welcome
