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Copyright 2000 Phoenix Newspapers, Inc.
ARIZONA BUSINESS GAZETTE
July 13, 2000 Thursday, Weekly

HEADLINE: KOLL BUYS SCOTTSDALE LAND

Koll Development has bought a prime piece of land slated for a Class A office project in north Scottsdale. The Scottsdale developer paid $8.7 million for the 16.5-acre site in the Perimeter Center at Bell Road and the Loop 101. Discount Tire had considered the spot last winter for a new corporate headquarters but backed out of a deal after some neighborhood opposition and internal changes.

Koll Development plans 250,000 square feet of upscale office space. Mort Fleischer's Scottsdale Land Trust sold the land. No word yet if the tire company will move its offices into the new project.

* * *
The information/sales center in North Scottsdale's McDowell Mountain Ranch
has closed, signaling the 3,200-acre community is nearly sold out. The
community ranked as one of the nation's top 10 selling home projects in 1997,
according to the housing group Robert Charles Lesser & Co., and will have sold
out in less than five years.
More than 2,500 homes have been purchased in McDowell Mountain Ranch, and
the only lots left are in the community's more exclusive and expensive
neighborhoods. To commemorate the completion of the community, developer
Sunbelt Holdings tallied foot traffic: It counted 158,775 visitors who toured
model homes, and 38,315 presentations to prospective buyers.
North Scottsdale has only a few large parcels left for new homes. The state
Land Department owns most of the sites.
* * *
The Villa Madeira Apartments in Scottsdale have been purchased by a
partnership between multifamily investors Fairfield Residential of San Diego
and the San Francisco-based RREEF Funds. The partnership paid Equity
Residential of Chicago $17.5 million for the 332-unit complex, said Marc
Huisken of Cushman & Wakefield. He negotiated the deal with Jerry Tenge of the
same firm. The property, at 7749 E. Camelback Road, was built in 1971, and the
complex's new owners plan a major renovation.
* * *
Hayduke lives! Character George Hayduke in Edward Abbey's novel The Monkey
Wrench Gang would chuckle at the billboards that the Friends of Lake Powell
have put up along Valley freeways. Then he would cut them down with a chain
saw or welding torch. The billboards read: Don't Let the Sierra Club Drain
Lake Powell. They're a head-scratcher for the uninitated who haven't followed
the decades-long debate over Glen Canyon Dam and the Lake Powell reservoir it
created.
Some environmentalists want to breach the dam and restore Glen Canyon.
Boating and tourism interests in Page are equally adamant in defending the
lake and the recreational and economic benefits it brings to northern Arizona
and southern Utah. Three million annual visitors to Lake Powell pump hundreds
of millions of dollars into the area's economy.
* * *
Once an uncut diamond, Esplanade has become a crown jewel. With the fifth
and final tower going up at the Camelback Esplanade, Fife Symington might want
to crow "I told you so" about the project he once championed. Not so fast,
Fife.
The project's success shows what's gone right in Phoenix's real estate
market since Symington and other high-risk builders were flushed out of the
system.
The project, at 24th Street and Camelback Road, where rents hover around
$30 a square foot, has become the most expensive and toniest business address
in town. Developer Opus West put up the Esplanade's third and fourth towers,
and a recently signed lease with Merrill Lynch means it will start on the
230,000-square-foot Esplanade V tower, at the east end of the project, in
September.
* * *
A Phoenix home builder is offering buyers a life-saving amenity. Instead
of just discounts on new swimming pools or upgrades on flooring, Richmond
American Homes recently started giving home buyers coupons to learn CPR. "We
see our homeowners as part of our extended family," said Ron French,
president of Richmond American's Phoenix Division. The buying perk is
particularly worthwhile in Phoenix, where almost every other home has a pool,
and drownings are far too common.
* * *
In biotechnology, the disciplines of biology and electronics are
converging, or at least overlapping.
Motorola Inc., through its BioChip Systems division in Tempe and Illinois,
is making its first venture into the realm of biotechnology. A biotech
division at first seems out of line with the company's history as an
electronics company where the word "cell" had invariably been followed by
the cold, inanimate word "phones." Suddenly "cell" evokes squishy, living
words like "nucleus" and "DNA."
Fueled by breakthroughs like the human genome project, biotechnology
industries-including biochips-are expected to provide some of the most
exciting growth of the coming decade. Two companies already have products in
the pipeline and others, like Motorola's BioChip Systems, are preparing to
wade into the fray.
The topics of electronics research have grown ever smaller, squeezing more
circuits onto a semiconductor or building machines the size of molecules. It's
a fairly logical leap from microelectronic machines to molecular biology,
Motorola says.
* * *
When the national supermarket chains barged into Arizona 10 years ago,
people thought the little grocery players were on borrowed time. Smaller
companies would be outspent and outpromoted by smarter, richer opponents, the
argument went. There'd be a shake-out and the locals would be the first to
fall. But somebody forgot to mail the script to Bashas'.
The Chandler supermarket chain has thrived while its larger competitors
have taken turns playing predator and prey in the consolidation game. Bashas'
has charted its own course, not buying into every fad to sweep the business.
And it has stuck with a strategy of offering several kinds of stores rather
than one cookie-cutter format for all neighborhoods.
"You don't take on those that have predatory pricing power," Bashas'
Chairman and Chief Executive Eddie Basha Jr. said. "You can't. They can
devastate you in rapid order. You have to devise a marketing strategy that
enables you to compete without challenging their innermost strength. It's not
an easy task."
* * *
Advanced Radio Telecom Corp. launched its business-class broadband
Internet service in Phoenix, which is the sixth-largest U.S. market for the
company. In addition to Phoenix, ART now offers its broadband IP services in
Los Angeles, Washington, D.C., Houston, Seattle and San Jose.
ART has said it plans to deploy its service in 10 U.S. markets during 2000.
The company provides businesses with connections at speeds of 10 and 100
megabits per second. Connections at up to 155 megabits per second are
available for data center and other high-capacity applications. ART's
broadband wireless provides connectivity to office buildings not served by
fiber connections.
* * *
SeraNova, an electronic and mobile business consulting company with
offices in Phoenix, has begun trading on the Nasdaq exchange under the symbol
SERA. The company was spun off from Intelligroup, a New Jersey firm.
SeraNova's largest office, with 175 employees, is in Phoenix.
* * *
Chandler-based SpeedFam-IPEC Inc. has developed a process for a new line
of semiconductor polishing tools that the company says will cuts costs and
production time for chipmakers. SpeedFam-IPEC makes chemical mechanical
planarization equipment used to polish the layers of materials added to wafers
during the manufacture of chips. SpeedFam-IPEC will ship a test version of the
new Momentum tool this quarter. Commercial shipments could begin in the fourth
quarter.
Momentum combines features from SpeedFam-IPEC's older machines but adds
inspection capabilities that monitor wafers more closely and find errors
sooner. That's especially important as chipmakers start using copper
connections in circuits since copper can erode when polished. Momentum looks
for erosion and adjusts the pressure applied during polishing.
* * *
Software602 has released a free alternative to Microsoft Office, 602Pro PC
Suite 2000. The updated version of the package of programs can be used without
charge by businesses or individuals. PC Suite 2000 includes three
applications, a word processor, 602Text with complex MS Word document formatsupport, 602Tab with MS Excel file format support and 602Photo, a photo editor
with support for several image formats. Direct support for digital cameras and
scanners is included.
The suite runs on Windows 95, 98, NT and 2000 operating systems and can be
run on a single PC or on a network server. The suite of applications can be
downloaded from Software602's Web site, www.software602.com.
* * *
Phoenix-based Web Emporium has hopped on the "bricks and clicks"
bandwagon by installing Web-based kiosks in West Marine stores, a major
boating distributor.
Bricks and clicks, or clicks and mortar, refer to businesses that have
physical retail locations as well as online commerce services. These kiosks
represent the first phase of a West Marine strategy to enhance its Web site,
www.westmarine.com. Customers can now place orders from West Marine store
kiosks and have their merchandise shipped directly to their homes. With the
kiosks, customers can order from the full product catalog of over 40,000
items.
* * *
Housing-market research firm the Meyers Group is on the Web. Data from the
Los Angeles-based firm, which has offices in Phoenix and across the country,
can be found at MeyersGroup.Com. The new site was launched last week at the
annual Western Building Show in San Francisco.
It has three components: housing information, housing analysis and "My
Markets," which allows people to track specific market conditions. David
Thikoll, who heads the Phoenix office, said browsers can get a taste of
housing markets at the site and then request more data. Meyers' research
reports start at $25. The data base has information on about 23,000 new U.S.
subdivisions. Meyers keeps a 'data warehouse' of more than 1,000 different
data fields on 1.9 million new homes across the country.
* * *
The Federal Aviation Administration offers a new Web site that allows
travelers to check on weather conditions around the country that could cause
flight delays. The site address is www.fly.faa.gov on the Internet.
* * *
Central Newspapers Inc. ended up pairing off with Gannett Co. Inc. last
week, but it started down the aisle with another suitor. The Phoenix-based
company, publisher of The Arizona Republic and The Indianapolis Star, held
preliminary negotiations with an unnamed company in late April and early May
about that company's possible interest in acquiring Central, according to sale
documents filed this week with the Securities and Exchange Commission. "The
parties could not reach agreement on terms, and the negotiations were
terminated," the filing says of the talks.
* * *
Jerry Moyes, chief executive of Phoenix-based Swift Transportation Co.,
said he ended a $44 million offer to buy Simon Transportation Services Inc.
Moyes said he wouldn't extend his bid to acquire the Salt Lake City company
and won't buy any of the 1.4 million shares that were tendered.
* * *
Phoenix-based Connection Couriers, recent recipient of the 1999 Greater
Phoenix Chamber of Commerce Innovation Award, has merged with Jet Delivery
Corp., also of Phoenix. The merged company, called Jet Connection Delivery &
Logistics, says it will have the largest local same-day delivery service.
It has a statewide fleet of more than 180 contract drivers. The two
services' combined revenue was $6.8 million last year. Both companies' leaders
agreed that the push for the merger was the continuous struggle to attract and
retain drivers.
* * *
Money-losing SkyMall Inc. expects to land about $5 million in operating
capital from a private placement of stock. The Phoenix catalog and Internet
retailer said it will issue about 2.5 million shares of stock at $2 a share.
The company said investors include members of its board and RS Investment
Management of San Francisco and Wand Partners of New York. Proceeds will be
used for working capital. SkyMall lost $24.1 million last year. Its cash
balance at the end of March was $6.5 million compared with $16.1 million on
Dec. 31.
* * *
Icon Studios, which has been trying to develop a movie studio in the West
Valley, has filed for Chapter 11 bankruptcy protection so it can reorganize
its operations. Jerry Kosowsky, managing partner of Icon, said the filing in
U.S. Bankruptcy Court in Phoenix would not affect plans by another company he
heads, Glendale Media, to develop an employment center in an unincorporated
area near west Glendale.
Kosowsky said he believes a studio will be an integral part of the Glendale
Media development. His plans for a movie production studio have been in limbo
for more than two years.
* * *
The tech stock slide and some big-company blunders created a one-two punch
that socked investors in Arizona companies in the second quarter. The list of
companies with double-digit stock losses is long, with more than a dozen
losing 40 percent or more. The biggest losers were those with a technology
connection, as investors soured on the sector after a long, often crazy, love
affair. It's no longer enough to have dot-com in your name or a high-tech
product with lots of buzz. Investors are now focused on real cash flow.

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