Walking on Water

Fred Unger's idea of gondolas on Scottsdale's canal went under. Now he's back with a bridge and $250 million

Combine that commitment with Unger's 12-hour-a-day, six-day workweek, and by the early '90s, he was again turning profits for his investors.

It was the 1992 acquisition and rebuilding of the Hermosa Inn in Paradise Valley that radically altered Unger's reputation. Up to that point, he had been just another commercial land-grabber. He bought the fire-charred and abandoned Hermosa for a song and spent two years renovating it, blending contemporary amenities with the history of the 1935 adobe village.

When the Hermosa Inn reopened in 1994, it was praised for its comfortable but antique feel. Unger had managed something beyond buying a building, fixing it up, and selling it for more. He had created a destination with a personality. The Inn has since been listed as a historic hotel by the National Trust for Historic Preservation.

Jennifer Croll and Abby Traister, the fashion powerhouses behind The Mix, are assembling 25 local designers and boutiques for SouthBridge.
Brad Garner
Jennifer Croll and Abby Traister, the fashion powerhouses behind The Mix, are assembling 25 local designers and boutiques for SouthBridge.

With the Hermosa, Unger proved a knack for historic properties, but it was the Royal Palms that cemented his reputation as the Valley's most tasteful developer. Unger performed a similar two-year rehab of the Royal Palms. The result was even better.

Anyone who hung around the bar of the pre-Unger Royal Palms can tell you about the remarkable transformation the place made in Unger's hands (though some still miss the heart-shaped pool). Unger turned a dilapidated estate into one of the finest resorts in the Valley (among other notables, President George W. Bush has stayed at the Palms twice.).

Hot off that success streak, Unger didn't consider it such a challenge to turn the banks of Scottsdale's Arizona Canal into the hippest commercial and restaurant destination in the Phoenix metroplex.

"You may see me spread-eagled on a bulldozer before this thing's done," Save Old Town president Barbara Espinosa told New Times in 1999, two weeks before Scottsdale residents voted down Unger's original Canals of Scottsdale project.

Espinosa was one in a swarm of downtown Scottsdale owners and residents who wrangled with Unger in a two-year political battle that ultimately stopped the Canals of Scottsdale project before it ever got started. For those who still considered Scottsdale "The West's Most Western Town," Unger's plan was too much too soon.

"I was opposed to the $300 million subsidy, and I was opposed to the condemnation of 120 properties," Espinosa says now. Like many of Unger's biggest enemies, Espinosa has mellowed on him over the years.

"I think [SouthBridge] now is far superior to what was proposed [back then], and what was proposed was going to cost the taxpayers $300 million and give the developer the money," Espinosa adds.

Downtown owners whose shops would have been razed for the Canals of Scottsdale are less forgiving. Unger's Canals plan included a then-realistic call for the city to condemn and destroy multiple properties. Patches of animosity still remain in the downtown shops neighboring SouthBridge.

"He wanted to condemn us and take us out," says one Fifth Avenue business owner, who expresses his dislike of Unger but doesn't want his name published for fear of riling the developer. Such is the consensus among the few owners who didn't sell their land to Unger after the Canals of Scottsdale went under. Most of them say they don't approve of Unger, but they realize he owns most of the property in the area and don't want to upset him.

Other adamant opponents of yesteryear, like architect Sam West, say, "I can tell you ahead of time I have no comments about Mr. Unger."

Unger's past enemies have no complaints, however, about the finished look of SouthBridge's first four buildings.

"Unger does quality projects," Espinosa says now. "Fred Unger and I had a discussion about it. I don't have any problems [with SouthBridge] whatsoever."

Scottsdale's success as a shopping mecca has long been a financial reality and a cultural oddity. Like the scads of shopping centers scattered across the Valley, Fashion Square (the largest mall in Arizona and the 15th-largest in the nation) doesn't offer a walking district or nearby cultural amenities.

Local municipalities have been trying and failing to build cultural walking districts for years. But downtowns like those of Phoenix and Scottsdale are sprawling and lack the traditional core of more dense and historic downtowns.

Now, almost a decade after Unger's first failed Canals of Scottsdale plan, more than 100 developers have dropped a combined $3.1 billion into the heart of the city.

Across the canal from SouthBridge stands the 13-story Waterfront (opened in late 2005, with Pink Taco and Borders, as well as luxury condos and underground parking), which is already luring Fashion Square visitors outside and one block closer to historic Old Town. But the Arizona Canal still isolates shoppers from downtown Scottsdale's maze of restaurants, galleries, and clubs.

Unger's SouthBridge is designed to funnel those shoppers from Fashion Square and the Waterfront to the eclectic culture of Old Town. He's connecting them, quite literally, with a bridge. In fact, as the shopping crow flies, the distance from Fashion Square's food court to the canal is just a few paces more than the walk from the food court to Dillard's.

When shoppers walk to SouthBridge, they'll find a refined version of Unger's 1997 canals vision — a retail center with a high-end, historic aura and nary a sign of a chain eatery or thread shop. No gondolas either.

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your article on fred unger and scottsdale's recent planning missed mentioning of scottsdale's of pud's (planned use developments) and that is not many owners of million dollar plus condos want to wake up in the morning and serve themselves starbucks.

in 2006, scottsdal's planners made the deciesion that "workforce housing was too expensive to develop" in the downtown area. that concept alone would be more comical if today i hadn't spent 45 minutes driving south on hayden to go from thomas road to mckellips at 5:30 p.m. this is typical for any north/south route at that time of day.

why would i want to waste my time and gas when i can go online and find the same stores, but without the hassle?

arizona should consider charging scottsdale for the 101. this kind of poor planning (and greedy snobbery) not only makes scottsdale a valley pollution leader, but overlooks another important detail; the rich don't live very comfortably by themselves. they need others to serve them.

a stunning design isn't very impressive with a high budget. the real challenge would have been to pioneer a stunning plan for a truley mixed community development.

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