Tempe advances Denell Plaza redevelopment, approves $2.75 million property conveyance

Tempe Advances Denell Plaza Redevelopment Amid Fervent Community Debate Over Housing, Arts, and Culture

Tempe City Council held the first public hearing on a contentious redevelopment that could reshape one of the city's most iconic and culturally significant blocks. On January 5, 2024, the council unanimously approved moving forward with an ordinance authorizing conveyance of approximately 3,146 acres of city-owned property at the southwest corner of Southern Avenue and Mill Avenue to an approved developer, with the transaction valued at $2.75 million based on independent appraisal.

The action represents a critical threshold moment for a site that has eluded successful redevelopment for more than a decade despite repeated attempts. Economic Development Director Mike D Dominico and staff framed the evening as the formal opening of a phased, community-engaged process—one that will require months of planning and stakeholder input before any physical changes occur on the ground.

Key Speeches

"This effort is the closest the community has been to bringing the site to its full potential and best use." — Mike D Dominico, Economic Development Director

"We have to look at sustainable development through the lens of the housing crisis and affordable housing. Tempe will need 20,000 low-income units by 2040, which means Tempe should build 100 units every 30 days." — David Soski, virtual public commenter

"I want to express my sincere gratitude to the council for the recent approval for the development agreement. This marks a pivotal step forward in our collective journey to reshape Denell Plaza... the developers understand and appreciate the significance of Yucka Tap Room to the community. The community's input will be involved in the development process." — Rodney Hu, Yucka Tap Room owner

"One, Yucka Tap Room is not going anywhere, and two, all we're doing tonight is assembling the parcels so we can begin the master planning of that site. There is no plan yet that it's still in draft... we're just putting the land together then we'll go through the process of stakeholder involvement, business involvement, staff, the council, the public, and figuring out moving forward with a plan with everyone in this room's input." — Councilmember Randy Keating

"I just want to let everybody know that I think we forgot we were talking about—let's save Yucka Tap. Well, Rodney Hu owns it and is sitting right here and he's given us, he's telling us that he wants to be a part of it... we should be feel comfort to know that the owner of Yucka Tap Room is right here telling us that you know I want to be a part of this." — Councilmember Berdetta Hodge

Timeline

• Staff presentation: Economic Development Director Mike D Dominico and Josh Rutherford outlined the site's history: original condominium declaration recorded in 1963 establishing 52 lots; city began acquiring parcels in January 2011 after the property fell into disuse. City has now assembled 14 lots (plus five additional acquired in February 2012). Development agreement signed November 29, 2023, following approval of a resolution on September 7, 2023. A formal independent appraisal set fair market value at $2.75 million for city property. Staff described the phased approach: (1) assemblage; (2) condominium reorganization; (3) property transfer (authorized tonight); (4) planning process including full public hearings, development review commission, and council approval before any project moves forward.

• Public hearing opened: Fifteen speakers over approximately 90 minutes addressed the council, spanning housing advocates, arts and culture advocates, neighborhood representatives, local business owners, and community members.

• Council discussion: Five council members—Randy Keating, Garland, Berdetta Hodge, Arlene Chin, and Mayor Corey D Woods—offered detailed remarks emphasizing that this is an early-stage action (property assemblage only), pledging robust community engagement, and acknowledging the site's cultural significance. All speakers emphasized no master plan exists yet and planning will be community-driven.

• Vote: First hearing passed unanimously on voice vote with all six members present voting in favor (Councilmember Davaro absent).

Opposition

Number of speakers against: Approximately 4–5 speakers raised significant concerns or opposed development entirely.

Main concerns:

1. Cultural preservation: Multiple speakers emphasized the irreplaceable value of Denell Plaza's existing arts, music, and live-performance venues, particularly Yucka Tap Room (operating nearly 50 years), Capistrano restaurant, bio, and smaller performance and arcade spaces that serve artists, musicians, and working-class residents affordably.

2. Loss of iconic businesses: Speakers cited the closure of Long Longs, Minder Binders, the Set, the Clubhouse, Salin, and other cultural anchors, arguing that Denell Plaza is among the last surviving venues for live music and grassroots arts activity in Tempe.

3. Density and traffic impacts: Multiple neighbors (particularly Tim Palmer, who has lived near the site for 60 years) expressed concerns that high density would exacerbate traffic congestion at the already-troubled Mill and Southern intersection, which they described as already experiencing "horrendous" traffic problems.

4. Lack of guarantees: Speaker Jacqueline Swan warned that past projects (including Idea Center and Tempe Farmer Arts District) signaled arts and culture commitment but failed to deliver, and called on council to "protect culture and creative space before compromising art for the sake of profit."

5. Incomplete process: Ann Till and Phil Yates (Riverside Neighborhood Association president) criticized the lack of development agreement details in the agenda materials and the absence of formal neighborhood hearings to solicit community input before planning begins. Yates asked: "Why was it purchased for $2.75 million? It's a very big area. We want to be included as this process goes forward with regard to what height is, what the density is."

6. Unconscious development: Antonio Morales expressed fear that development would prioritize revenue over community connection and cited examples of working-class gathering spaces being lost. He cited the Roosevelt District in Phoenix as a model for preserving culture while developing.

Most compelling arguments:

Jacqueline Swan's testimony—delivered from the council virtual platform—articulated the most emotionally resonant opposition framing: Denell Plaza as representing a rare surviving "counterculture" and "creative safe space that has organically grown," and warning that the council faces a choice between "an early step" toward renaissance or "one of the final nails in a coffin for our once accessible local culture."

Matt Dixon (artist, educator, 17-year employee of New School for the Arts) emphasized the economic dependency of local arts workers on affordable live venues and asked whether the city truly needs "more housing with empty spaces on the bottom" when other infill opportunities exist.

Organized groups:

Riverside Neighborhood Association (represented by President Phil Yates). Arizona Roller Derby League (represented by Mary Feny, seeking incorporation of skating facilities in development planning).

Support

Number of speakers for: Approximately 6–8 speakers advocated for development, most framing it as necessary for housing and community growth.

Main arguments:

1. Affordable housing urgency: David Soski delivered the most data-driven pro-development testimony, citing Tempe's need for 20,000 low-income units by 2040 (approximately 100 units every 30 days). He argued that 45–65 units per acre at Denell Plaza is "completely reasonable" and advocated for 40% affordable housing inclusion, drawing comparisons to Florida policies that override local restrictive zoning to encourage affordable production.

2. Health and social impacts: Soski noted that half the city is cost-burdened by rent, which produces health impacts equivalent to smoking a pack of day, and that affordable housing is linked to public safety, traffic congestion mitigation, employee retention, and education.

3. Site has been dormant too long: Tim Palmer (60-year Tempe resident and homeowner near the site) acknowledged that Denell Plaza "has never really developed into anything very nice" and viewed development as inevitable and preferable to further stagnation.

4. Opportunity for Renaissance: Multiple speakers (including Palmer and Robert Moore, community observer) echoed the potential for Denell Plaza to become a "renaissance" for arts and culture as part of development, not destroyed by it, particularly given Rodney Hu's active engagement and leadership in the planning process.

5. Growth is natural: Nicole (healthcare professional specializing in senior health) framed development as addressing social determinants of health through access to "safe, modern, and conveniently located housing," particularly for seniors.

6. Support for dignified, affordable futures: Elis Soso (homeowner of five years) advocated for housing "for low-income families and for housing seniors," calling for prioritization of "community and affordability and the dignity for all."

Most compelling arguments:

Soski's testimony combined urgency (100 units every 30 days needed) with specificity (40% affordable at highest density) and comparative policy (Florida's state override of local restrictive zoning). Robert Moore's testimony was notable for reconciling support with genuine respect for existing culture: he highlighted Rodney Hu's unprecedented leadership role in the planning process as a reason for hope, while acknowledging historical failures (Idea Center, Farmer Arts District) that failed to deliver on arts commitments.

Project Details

• Case number: Ordinance 4243 (introduction and first public hearing); second hearing scheduled January 18, 2024.

• Applicant / developer: Approved developer not named in public hearing (development agreement signed with unnamed party; Economic Development Director referred to "development team" and "developers" throughout).

• Attorney: Sam Aerosmith, City Attorney, made a mid-meeting record correction clarifying funding source distribution for an unrelated construction contract (Item 8A2); no private developer counsel identified in transcript.

• Location / address: Southwest corner of Southern Avenue and Mill Avenue, Tempe, Arizona. Site historically known as Denell Plaza; original condominium declaration recorded 1963.

• APN (if stated): Not stated in transcript.

• Current zoning → Proposed zoning: Not discussed; formal zoning process explicitly deferred to later planning phase.

• Density / units / square footage: Approximate acreage cited as "3,146 acres" (note: this figure appears anomalously large for an urban infill site and may reflect a transcription error—no correction offered in transcript). No unit count, density, or square footage specified at first hearing. David Soski advocated for 45–65 units per acre as "reasonable" and 40% affordable housing, but council explicitly stated no plan yet exists.

• Changes from previous version (if reconsideration): This is the fourth RFQ issued for the site since 2002. Staff noted three prior failed attempts at redevelopment. Development agreement structure (phased approach with property conveyance preceding master planning) is characterized as "unique" and designed to accelerate progress while protecting city interests and managing site complexity.

Vote Breakdown

• Final (Item 8B1, First Hearing): Passed unanimously on voice vote; transcript states "passes six to zero with council member devaro absent."

• Yes: Mayor Corey D Woods (presumed, voted), Councilmember Jennifer Adams (presumed, voted), Councilmember Nikki Amberg (presumed, voted), Councilmember Arlene Chin (presumed, voted), Councilmember Berdetta Hodge (presumed, voted), Councilmember Randy Keating (presumed, voted).

• No: None.

• Abstentions / absences: Councilmember Davaro (absent from meeting).

Note: Transcript uses voice-vote protocol without individual roll-call naming; the "six to zero" tally and notation of Davaro's absence are stated but individual votes not explicitly recorded by member name.

Outcome & Next Steps

The first public hearing on Ordinance 4243 passed, advancing the measure to a second and final public hearing scheduled for January 18, 2024. If passed at that hearing, the ordinance will authorize the City Manager to execute and deliver a deed conveying city-owned property at Denell Plaza to the approved developer upon satisfaction of all conditions stipulated in the development agreement signed November 29, 2023.

The development process will unfold in four explicit phases, which may overlap:

1. Assemblage: Developer will finalize property boundaries within Denell Plaza to the extent possible (completing negotiations with non-city owners holding the red-shaded parcels noted in staff presentation slides).

2. Condominium reorganization: Once assemblage is substantially complete, the Condominium Association will be asked to consider reorganization of the original 1963 Declaration to facilitate unified development.

3. Property transfer: Transfer of city property to developer, authorized by tonight's first hearing passage and to be finalized upon council's second vote on January 18.

4. Planning process: Formal master planning, zoning review, development review commission hearings, and city council approval for the actual development proposal. Staff emphasized this phase will include robust public engagement, neighborhood meetings, and full transparency.

Conditions and Commitments:

• Rodney Hu, owner of Yucka Tap Room, publicly committed to working with the developer and city on zoning and planning.
• Council members pledged "robust" community engagement and stated explicitly that no master plan exists yet.
• Councilmember Randy Keating emphasized: "We are really close [to] doing something special here in the City of Tempe," but "we look forward to everyone's participation moving forward" and the process is "nowhere near any sort of end mark."
• Council members and Hu acknowledged the cultural and economic importance of the existing venue ecosystem and pledged to preserve it as part of development planning.

Controversies & Context

Historical context: The site has resisted redevelopment for over two decades. It was developed as a strip-shopping center with condominium declaration in 1963 and has served as a cultural and entertainment hub—particularly for live music (Yucka Tap Room, nearly 50 years; Capistrano, bio, arcade). The city began acquiring parcels in January 2011 in an attempt to assemble enough land to attract serious redevelopment interest. Staff noted that four separate RFQs were issued since 2002, and multiple council attempts over seven-plus years yielded no executed development agreements until November 2023.

Cultural preservation narrative: The site has become a symbol of Tempe's working-class, punk-rock, and artist-centered culture. Multiple speakers cited the loss of Long Longs, Minder Binders, the Set, the Clubhouse, and Salin as evidence of disappearing cultural anchors. Jacqueline Swan (Vice Chair of the Tempe Arts and Culture Commission) framed the decision as existential: preserve culture or complete its erasure. Robert Moore and Antonio Morales drew comparisons to Phoenix's Roosevelt District as a model for culture-forward development.

Housing affordability crisis: David Soski presented Tempe's acute need for 20,000 low-income units by 2040, a benchmark established by housing advocacy analysis. He cited California and Florida as cautionary examples: in both states, chronic municipal "NIMBYism" has prompted state-level policy overrides stripping local land-use control. He argued that failure to build affordable housing in Denell Plaza now risks future state preemption of Tempe's zoning authority.

Community engagement controversy: Multiple speakers (Ann Till, Phil Yates) criticized the opacity of the development agreement and the lack of formal neighborhood input opportunities before planning begins. Till called for "a hearing where this is presented to the neighborhood" and early solicitation of community priorities. Yates asked: "We don't really have a whole lot of answers as to what we want to do at Denell Plaza... we would like to be included as this process goes forward." Council members acknowledged this feedback and committed to neighborhood engagement during the planning phase.

Site complexity: The property remains fragmented. Staff noted that city and developer own the green-shaded parcels shown in presentation slides, but non-participating owners hold the red-shaded lots. Condominium reorganization will be required before unified development can proceed—a legal complexity that staff cited as a reason for the phased approach and the separation of property conveyance (tonight) from master planning (future).

Traffic and density concerns: Tim Palmer and others raised concerns that high-density development would exacerbate existing traffic congestion at Mill and Southern, already described as problematic. No traffic study or density projections were discussed at the hearing; Randy Keating noted "all we're doing tonight is assembling the parcels," reinforcing that these details remain unresolved.

Duration

• This item (Denell Plaza, Item 8B1, First Hearing): Approximately 90 minutes (staff presentation ~10 minutes, public comment 15 speakers ~75 minutes, council discussion ~5 minutes).

• Total meeting: Approximately 2.5 hours (called to order after opening remarks and proclamation for law enforcement appreciation day; concluded after council announcements and future agenda requests).

Other Notable Items

Hayden Building Corporation Construction Contract (Item 8A2): The City Attorney made a mid-meeting record correction clarifying the funding source distribution for a $37.4 million construction contract award to Hayden Building Corporation for the Tempe Municipal Operations Center GMP Phase 2 project. The total contract amount was not changed; only the allocation among funding sources (269, 899, 8369) was adjusted for accuracy. The corrected item passed 6–0.

Tempe Veterans Commission Ordinance (Item 8C1): The council held the second and final public hearing on an ordinance amending Chapter 2, Article 5, Division 20, Section 2-365 regarding membership on the Tempe Veterans Commission. No public comment was received. The item passed 6–0.