We knew Tempe could do it all along. Last week, Vestar Development announced the company had made deals with enough of the hold-out land owners to start work in January on the $250 million Tempe Marketplace near loops 101 and 202.
That means 50 property owners have sold at market prices so their land can be cleansed of decades of industrial pollution and then transformed into 1.3 million square feet of upscale shopping and entertainment.
And it has happened without the city condemning a single square inch.
For months, we urged Tempe officials to drop a court battle with reluctant landowners in light of the groundbreaking Bailey Brake Shop case that bars the use of eminent domain to benefit private development. We believed the city could find a way to address the environmental problems and protect taxpayers without the coercive power of condemnation, even if leaders had to rethink their development strategy for the 117-acre site.
In the end, Tempe Mayor Hugh Hallman, with able advice from councilmembers Ben Arredondo and Hut Hutson, was able to bring together Vestar and most of the remaining landowners despite several setbacks for the city in court.
To be fair, Hallman and the current City Council were in a tricky position. The city’s agreement with Vestar signed in April 2004 under previous Mayor Neil Giuliano gave the developer every right to demand Tempe seize key parcels if the owners refused to sell. The city had to choose between an attack on property rights for redevelopment that had been used frequently before the Bailey case, or risk a lawsuit from Vestar for breaking the contract with potential damages in the hundreds of millions of dollars.
Vestar might still insist on further city appeals because of two remaining hold-outs. We urge those two owners to also reach a deal, recognizing their land values could easily drop once their property becomes isolated islands in parking lots for the future Tempe Marketplace.
And we hope other Arizona cities now see the larger picture. A strict constitutional interpretation of government’s use of eminent domain isn’t a death blow to quality redevelopment projects. Cities just need to be more creative and energetic about finding acceptable alternatives.