PHOENIX — The Phoenix City Council has given the last required vote to begin a redevelopment project on the shuttered Metrocenter Mall.
By a 6-2 vote Wednesday, the council authorized the city manager to enter into a development agreement with Phoenix IG LLC to execute an 80-acre mixed-use project at the site of the iconic Valley mall.
The proposed multi-phase project would consist of over 3,100 multi-family residential units, 100,000 square feet of retail space, two hotels, and a public park.
"With excellent housing, transit, business and retail options all in one place, Metrocenter will once again be a vibrant hub for the northwestern part of our city," said Mayor Kate Gallego in a statement.
Metrocenter originally opened in the 1970s and was often referred to as the "crown jewel" of the Valley. Its large department stores and food court notably served as shooting locations for "Bill and Ted's Excellent Adventure" in the late 1980s.
But the mall closed its doors in the summer of 2020 after years of decline. Now city officials are hoping developers can generate new life into the dormant piece of real estate.
“This redevelopment is just the first of so much more to come to the Metro region,” said Councilwoman Ann O’Brien. “With this investment, we’ll be able to attract more partners interested in working with community members to completely revitalize the Metro District – making it cleaner and safer for everyone.”
City records show the developer has agreed to contribute $1.5 million to Phoenix's affordable housing trust fund as a condition of the agreement.
"The Project will bring a capital investment of approximately $1.14 billion to the Metro District Area at full build-out," city records state.
Additional business terms of the agreement include:
- The parties will enter into a development agreement for the application of Government Property Lease Excise Tax treatment within 6 months of Council authorization.
- Subject to state law, the developer must enter into any lease within 10 years of Council authorization.
- The developer may purchase the property prior to the 25-year maximum term, but must pay the City 50% of any remaining rent. In addition, the developer must also satisfy any pro-rated minimum tax payments if exercising its purchase option.
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