Commercial Real Estate: Arizona Indians Turn to Real Estate Development

SCOTTSDALE, Ariz., Dec. 18 - Rechanda Howard, a soft-spoken member of the Salt River Pima-Maricopa Indian Community, remembers how her grandfather, Joseph Ray, used to talk about the 90 acres of remote arid land that the federal government allotted to his family in 1913. "He said the land would never be worth anything," said Mrs. Howard, now a grandmother herself. Set against a backdrop of red clay mountains, the creosote-and-mesquite-covered land that Mrs. Howard and two dozen relatives inherited is a picturesque reminder of this region's desert past. But acreage that seemed isolated when the reservation was established in 1879 now bumps against the edge of this manicured city of 203,000. And it lies just to the west of the recently completed Pima Freeway, the major north-south artery in the sprawling Phoenix metropolitan area, with its population of 3.3 million.

Long before the freeway, developers had their eye on Indian lands. The biggest projects so far have been a shopping center with big-box retailers and a Wal-Mart. Early next year, however, Mainspring Capital Group, a local developer affiliated with Ross Brown Partners, a real estate services company, plans to begin clearing and grading the site for the first phase of Pima Center, a $600 million commercial development on 209 acres owned by Joseph Ray's descendants and 34 other Salt River Pima-Maricopa families. Once completed, the project will be one of the largest private business parks on Indian land. Pima Center, which is slated to be a mix of high-end office buildings, retail stores and warehouse and distribution space, is one of several developments that are expected to sprout along the freeway on land leased from the tribe.