Phoenix pursues deal with Mortenson for prime desert land development

By Hailey Mensik

Millions of square feet of new commercial development could rise in north Phoenix.

The city of Phoenix is pursuing a development agreement with Minnesota-based real estate developer Mortenson for a site of prime desert land formerly eyed by the Phoenix Coyotes for a proposed hockey arena. In June, Mortenson placed the winning bid in an Arizona State Trust land auction, paying $136 million for the 217.16-acre site located west of North Scottsdale Road and north of Loop 101.

Mortenson’s plans for the overall site include five million square-feet of commercial space, according a Phoenix City Council agenda item to be discussed Aug. 27. The first phase of development is set to feature a 30-acre mixed-use spec office campus.

The city hopes the project will help continue the trend of companies looking to set up new corporate headquarters in the area, signifying “a return to normal in-office business and recovery from the COVID-19 pandemic,” according to the agenda item.

The site is nearby is the CityNorth development near 56th Street and the Loop 101, which will be home to Sprouts' new 180,000-square-foot, mixed-use headquarters campus, along with Republic Services' new headquarters campus.

An initial public infrastructure development agreement with Mortenson is what's on the agenda for Phoenix’s City Council meeting on Aug. 27, the body's first meeting following a summer recess.

As part of the agreement, Mortenson will be in charge of master-planning and developing the entire 217.16-acre site, which should include Class A office, retail, restaurants and entertainment, to be completed in multiple phases.

The first phase, focused on new office space, should amount to no less than 350,000 square feet.

Some of the required infrastructure improvements include a $30 million contribution to Maricopa County’s Paradise Ridge Wash Mitigation project. The $30 million will allow the project to start and remove 1,000 acres of land from the floodplain to make it better suited for development.

Mortenson would also have to make improvements to street frontage, intersection upgrades, public water and sewer main extensions, and other regional floodplain improvements separate from the Paradise Ridge Wash Mitigation project.

Within three years of the initial public infrastructure agreement being approved, Mortenson will have to obtain all the public infrastructure improvement permits for phase one, pay all applicable fees for the initial phase of development, and receive the first infrastructure permit for phase one.

After public infrastructure improvements are made, the city would agree to reimburse those improvements on an annual basis, not exceed the amount Mortenson spends to complete them. Some elements are excluded, including the $30 million flood hazard project.

Mortenson could not be reached for comment at the time of publication.

Final Thoughts:

Phoenix’s agreement with Mortenson marks a major step toward transforming prime desert land into a hub for corporate headquarters, retail, and entertainment. With over five million square feet of commercial space planned, the project could reshape North Phoenix’s business landscape. Key infrastructure investments—including the $30 million Paradise Ridge Wash Mitigation project—will not only support development but also improve floodplain safety. If successful, this project signals continued growth, stronger corporate relocation opportunities, and a boost to Phoenix’s long-term economic momentum.