Rival for 911 bids is firm’s landlord - East Valley Tribune: News

Rival for 911 bids is firm’s landlord

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Posted: Wednesday, November 9, 2005 9:36 am | Updated: 9:31 am, Fri Oct 7, 2011.

Bob Ramsey is not only Southwest Ambulance’s bitter rival for 911 contracts across the East Valley, he is also the company’s landlord.

In 2005, Southwest will owe Ramsey — owner of Tempebased Professional Medical Transport — about $1.2 million in rent.

For the past nine years, Southwest has leased eight buildings, including its headquarters and fleet center in Mesa, from Ramsey. The properties are spread across the state, including ambulance stations in Casa Grande and Safford.

The rental arrangement highlights how tightly the competing firms are intertwined.

PMT beat out Southwest for Scottsdale’s lucrative emergency response contract last month. Ramsey’s company is also challenging the once-dominant Southwest in Chandler and may go after Tempe’s 911 service, too. Scottsdale residents alone are estimated to generate at least $6 million a year in ambulance

bills.

As competition for those dollars has progressed, the companies have engaged in public attacks and counterattacks.

The firms’ emergency workers have become a prized commodity in the fight. Southwest has offered PMT employees large bonuses to switch sides, while at the same time, PMT is attempting to hire away Southwest paramedics in Scottsdale.

All the while, Southwest has been paying Ramsey to keep roofs over their employees’ heads.

The properties are listed with the Maricopa County Assessor’s Office under Starwest Associates, one of Ramsey’s companies.

Ramsey founded Southwest in 1982. Many of the company’s executives, such as CEO Barry Landon, once worked directly for the man now threatening to cut into their business.

"It’s probably not what the companies want to advertise, that they’re so close," said Jon Altmann, managing editor of Fire Times, an online fire and ambulance news clearinghouse. Ramsey is co-publisher of Fire Times, along with Pat Cantelme, PMT’s chief executive officer, and Alan Brunacini, Phoenix’s fire chief.

Ramsey purchased a controlling share of PMT in February and since has transformed it from a small company known mainly as a courier service for hospital patients into a major player in the East Valley 911 industry.

PMT is expected to launch its first emergency response operation in Scottsdale by early next year. At the same time, the firm will be competing to

dislodge Southwest from Chandler.

Even though Ramsey left Southwest, he has not cut all ties to his former company.

In 1996, a year before Ramsey merged Southwest with Rural/Metro Corp., he signed the company into 10-year leases for the eight buildings, Landon said.

The move came at a time when the ambulance industry was shrinking nationwide, with the big emergency response corporations such as American Medical Response and Rural/Metro purchasing or merging with many smaller, local firms.

It was common for the major ambulance firms to allow owners of the smaller companies they were purchasing to retain their buildings as part of the payment, said David Shrader, a North Carolina ambulance consultant who advised Scottsdale in its competition. The larger corporations would often lease the buildings back from the previous owners.

Ramsey cut himself a different deal, securing leases with Southwest before turning the company over to Rural/Metro.

The leases are to expire in December 2006 and Southwest has already laid plans for a new headquarters and operations center on 13 acres in Mesa, near the intersection of Country Club Drive and Baseline Road.

Southwest will leave the other stations it rents from Ramsey at the same time, Landon said.

"They’re old, tired facilities" that S outhwest is required to repair when maintenance problems arise, he said.

Southwest executives also grumble that they are paying the company’s founder too much rent. "We’re clearly paying more than current market value," said Josh Weiss, a Southwest spokesman.

Ramsey said he could not confirm the exact amount of the rent he collects from Southwest, but did not dispute the estimate of $1.2 million. Southwest provided the Tribune the rental rate it paid per square foot for each property in 2003, the buildings’ size and the annual percentage rate increase built into each lease. The Tribune calculated the total cost for 2005.

Altmann, a former Southwest executive who became Rural/Metro’s national marketing director after the merger, said there were no complaints with the property costs at the time of the lease deals. "The corporation was very pleased to acquire the access to those facilities and in many cases they said it was superior facilities for them," he said.

Despite the tension between Southwest and Ramsey, both have said they will honor the leases until they run out and called their rental relationship largely congenial.

"In the last couple years they’ve been paying rent on time. That wasn’t always the case," Ramsey said last week. "They (went) through a rough time, from a landlord’s perspective."

Landon said Southwest has made its payments on time and fulfilled every part of the leases.

For its part, Southwest looks forward to being free of Ramsey, he said. "I will have a new landlord," Landon said, "no doubt about it."

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