Tuesday, March 5, 2019

Johnston Brings A Focused Approach to Oro Valley Economic Development

Johnston brings fresh approach to Oro Valley economic development
With council approval, Oro Valley will head in several new community and economic development directions. Oro Valley's economic development plan for the past eight years was what LOVE termed "The Rooftops Strategy." Build as many rooftops as possible to so that business will come to Oro Valley. Business will generate sales tax revenue.

Residents saw the result of this policy. The rooftops were built. Lots of rooftops. Even today, there are many more rooftops coming, rooftops that were approved by former Mayor Hiremath and his council majority, which includes current council members Pena, Rodman, and Solomon.

Perhaps sensing that Oro Valley needs to move in new directions, Town Manager Mary Jacobs hired now town Development Director J.J. Johnston last May. Johnston, a long-time economic development professional brought public sector economic experience in the West. He interviewed more than 90 people and spent more than 450 hours identifying and laying our possible future directions in a draft comprehensive economic development strategy. We spoke with Johnston last week about his strategy.

Oro Valley needs "smart" economic development
Johnston believes that “It is incredibly important to get this right. To get as close to as we can to having a smart plan that is very focused on protecting the environment, protecting all of the community assets and adding value to those.”

The challenge as Johnston sees it is that “We have some great employers here already. We just don’t have enough diversity. If we did we wouldn’t have 13,000 adult workers who live in Oro Valley driving out of our community every day to work somewhere else.”

Last week, we listed 11 economic development focus areas that his plan identifies. All are worthy of discussion, but three strike us as particularly creative. Here's the first.

Battle empty storefronts with a "smart retail plan"
Johnston believes that Oro Valley needs to attract retailers who target the demographics of the community. He terms this a "smart retail plan."

"Every retailer has said we need three things to exist: Density, traffic and household income. We’ve got one of the three in spades. We have a very high disposable income. We just don’t have enough people spending the dollars in our stores and there’s Amazon and other things."

Johnston would like to retain consultant to define the smart plan.

The consultant will identify the types of retailers that fit Oro Valley's demographics. Then, the town can use this information to create materials for discussion with lessors and others to encourage them to seek out these types of retailers.

It is Johnston's way of battling the increasing problem of empty storefronts in Oro Valley.

The consultant will also examine other factors that may be causing empty storefronts. "Are our lease rates too high? Is that one of the factors..." causing empty storefronts? "We want an expert to come who has deep experience and understands the thought process..." that lessors and lessees use in making their decisions.

Johnston's approach is proactive and not reactive
Once the consultant completes the work, Johnston will meet with key players in Oro Valley's retail space. This would include Oro Valley Marketplace owner Vestar. "We're preparing for a meeting with Vestar after we have a consultant come in and give us a hard look on where our challenges and where our opportunities are. We very much want to. Mary, in particular, needs to be in front of their executive team."

They have already had conversations with other important players in Oro Valley's retail space, including Neil Simon of Venture West. According to Town Manager Jacobs "We work with him all the time." Simon's company operates the center on the southeast corner Oracle and Magee. They have been successful in attracting tenants. Simon "...is one of the 90 people I interviewed early on... We consider him a great partner."

Next Up: The Oro Valley Innovation Lab
Venture West owns innovation park, a key subject in our second very economic development focus area. Innovation Park is going to house: The Oro Valley Innovation Lab. We'll discuss it in a future posting.