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

The conference table in Fred Unger's office is cheap. The walls are papered with photos and magazine spreads tacked into drywall — there's none of the mahogany and marble typical of multimillion-dollar developers.

Unger has spent the past 10 years obsessing over these thumb-tacked pictures. One shows a table next to a Venice canal, another a storefront on Rodeo Drive in Beverly Hills, another a cafe in Paris. They are reminiscent of what he's now building along the sometimes stinky, green-brown canal that splits downtown Scottsdale.

Unger, 58, sits cross-legged in conservative dress slacks and a short-sleeve button-up shirt. He talks with his hands and occasionally adjusts his signature rimless glasses. He's gabbing about shopping — particularly about the Galleria, the most colorful disaster in Scottsdale's retail history: a 600,000-square-foot pink chunk plopped so awkwardly in downtown that the city repaved Scottsdale Road to curve around it.

Fred Unger
Brad Garner
Fred Unger
A rendering of SouthBridge, Fred Unger’s mixed-use village, which backs up to the Arizona Canal in downtown Scottsdale.
courtesy of Fred Unger
A rendering of SouthBridge, Fred Unger’s mixed-use village, which backs up to the Arizona Canal in downtown Scottsdale.
Fred Unger bought the charred remains of Hermosa Inn in 1992. He rebuilt the Paradise Valley property into a historic landmark.
Brad Garner
Fred Unger bought the charred remains of Hermosa Inn in 1992. He rebuilt the Paradise Valley property into a historic landmark.
Next, he transformed the dilapidated Royal Palms into one of the finest resorts in the Southwest.
Brad Garner
Next, he transformed the dilapidated Royal Palms into one of the finest resorts in the Southwest.
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.

Unger's new development sits just one block away. Two of its seven restaurants are open, and a string of boutiques premièred just last weekend. So far, Unger's SouthBridge is looking swank, sparkling chandeliers mixing with cutting-edge contemporary design and a waterfall. The Galleria never looked this good. Unger says he knows why the Galleria was such a colossal failure.

"The Galleria was built as an anchorless shopping mall," he states with authority. "There's a reason shopping malls have anchors. So the Galleria started off with a flawed concept.

"Second, [Galleria developers] plopped themselves down next to Fashion Square, the most successful mall in Arizona."

Similarly, Unger's $250 million vision now rising along the banks of the Arizona Canal in Scottsdale, will have no chain store to anchor it and will sit in the shadow of Fashion Square.

And why will SouthBridge work when the Galleria failed? Unger's too polite to say, but his answer is clear: Fred Unger.

When the Galleria opened in 1991, high-end spenders could fork over $300 for a pair of socks, but a few years later, the Scottsdale Police Department's SWAT team was using the empty mall's carcass as a training warehouse.

Before the Galleria opened, Unger, then 38 and broke, had driven his family of six from Long Beach, California, to Scottsdale, looking for a fresh start. He found it — and the financial backing to turn the Hermosa Inn and the Royal Palms into two of the finest resorts in the Southwest.

Then one day in 1997, Unger walked behind a tattered art gallery in downtown Scottsdale. He wandered the gravel lip of the Arizona Canal and noticed that the backs of nearby shops were facing the water, not the other way around.

He had an idea: Venice in Arizona.

Unger soon sold his baby, the Royal Palms resort. The Canals of Scottsdale was his next vision, a $653 million behemoth that would include a Smithsonian museum (utilizing the aforementioned empty Galleria), canal-side restaurants, a movie theater, and gondolas floating tourists through a Venice of canals in downtown Scottsdale.

It stayed just that — a vision, mired in the murky waters of Scottsdale politics.

After two years and hundreds of thousands of dollars, Unger's Canals of Scottsdale project sank, but Unger continued buying the land around the canal — visiting shop owners to offer cash for their property. It was 1999, and sellers still considered the waterway a smelly concrete ditch.

Today, Fred Unger and his investors own most the property around the canal, a hot core of growth that pulses even as real estate elsewhere in the Valley stabilizes. Anyone who's driven around downtown Scottsdale should know Unger is in a good position.

"It's easy now for people to say downtown Scottsdale's hot — and cool," says Jason Rose, a former publicist of Unger's, now officing at SouthBridge. "Well, it wasn't that way five years ago. Unger is the one who was always there."

Ten years since his initial walk along the canal, Unger won't settle for just commercial success. He wants his new venture to be a cultural revolution. Now he's polishing his first four buildings, one block away from the flunked Galleria and even closer to Scottsdale Fashion Square.

"We're hoping," Unger says of the biggest ground-up development he's ever created. "There's no guarantee it will work."

It's this kind of barefaced risk-taking that's so typical of Fred Unger — a developer who talks, thinks, and creates more like a Hollywood screenwriter or Nashville musician than a bottom-line businessman. Visions of a canal project have kept him awake for a decade. Now their incarnation — smaller and more refined than his first plan — could mean a cultural rebirth for Scottsdale and a model for failed walking districts across the Valley.

It could also seal or spoil Unger's legacy as the developer with the best taste in town.


Fred Unger's a restless sleeper. He usually wakes in a creative hype about 2 a.m. After brainstorming, jotting notes, planning meetings, and rustling through design books, he naps again from 4 to 6:30 a.m.

At 7:30 on a recent autumn morning, Unger doesn't look tired. He's sitting in T. Cook's, the restaurant at the Royal Palms, for a breakfast meeting. Nine years ago, he sold this resort for $32 million. He still knows every fountain, tile, door, and painting on the 65-acre grounds.

Touring Royal Palms after breakfast, Unger explains the artifacts. "This chest is from Peru," he says. "These are camel stirrups."

Unger is tall, about 6-foot-3. He hangs his head with a dose of humility. Conversely, his stride is powerful and quick, scissored by a rhythmic swinging of his arms — the gait of a man who knows where he's going.

For every relic, there's a story. The exposed ceiling beams are from a collapsed bridge at the Great Salt Lake in Utah. The floor in the cigar room is leather. The tiles are from the original Cook family house, built in 1929, where T. Cook's now sits.

Beyond a front door that looks like something from the Ming dynasty, Unger points to uneven paving stones lining the resort's entrance, now the stomping grounds of bellhops. "We were in Mexico on a weeklong buying trip," Unger recalls. "A small town was tearing these stones up to modernize. I bought them on the spot."

These are the touches for which Unger's high-end resorts are known. In a market filled with bland, brand-new buildings, Unger's attention to detail gives his projects personality.

In that sense, Unger is as much a typical developer as Chris Bianco, the pizza artisan, is a typical restaurant chef. True, Unger has traits of the normal developer: He owns multiple properties across the country — as well as not one, but two Paradise Valley homes. He also drives a $100,000 Cadillac sports car. But Unger's single-minded passion about his projects smells more like creative obsession than cold hard cash.

"Fred is a unique client," says Scottsdale architect Kenneth Allen, "a visionary for sure. He has an ability to see what other developers don't and an ability to gather talent around himself."

Unger seems part artist, part businessman — the rare ilk of right-brain/left-brain leader who can create a concept, assemble a talented team, and then work the numbers to build the dream. He'll tell you himself: It works only about half the time.

Unger insists he doesn't spend his restless nights pondering how much money he can make. Instead, he pours himself into what he most enjoys. For more than a decade, his dream has been to transform the area around downtown Scottsdale's canal.

Finally, the planets of Scottsdale politics have aligned.


In 1954, a 5-year-old, skinny kid named Fred moved from Chicago to Jacksonville, Florida — the first uprooting in a childhood of uprootings. About every two years, Unger's father's business-equipment job yanked the family from Jacksonville to Birmingham to Atlanta to Denver to Pasadena, California.

The moves would prove traumatic and life-changing. Ultimately, Unger's dad was laid off by the same company that moved his family cross-country. "Watching that difficulty, I decided I would start my own company, so if I wanted to watch my son's Little League game, I could," Unger says.

In 1967, he enrolled in the real estate and finance program at the University of Southern California. After that, he worked in a commercial real estate firm, learning the trade. On a blind date, Unger met a manager from a Big Four accounting firm. "We were playing tennis, and before the second set was over, I knew I was going to marry her," Unger says. The tennis partner is now Unger's wife of 30 years, Jennifer.

By 1982, Fred and Jennifer had three children and a fourth on the way. They walked away from their stable, well-paying jobs in real estate and accounting to start their own company in Long Beach. "We put together relationships with lenders and investors, with the goal of buying property, improving it and making a profit for our investors," Unger says, recalling the invigorating risk of that first venture.

With those original investor dollars, Unger bought George Lucas' former Star Wars headquarters in San Rafael, California. "Lucas' people had left all the computer screens. We had big robots in the lobbies. It was very exciting," he says.

Six years later, he sold the Lucas building at a profit, and today, a number of the same investors from that venture have staked their dough on Unger's Scottsdale canal development.

But Unger's journey wasn't easy. After the success of the Star Wars property, the real estate crash of the late '80s leveled his portfolio. "The low point was when we couldn't afford the rent and had to leave our offices in Long Beach. We lost all of our money. We didn't go into bankruptcy, but we had to start over," he says.

In 1987, Fred Unger, 38, was broke. To clear his office lease, he left behind his collection of antique furniture. Fred and Jennifer packed their kids (ages 9, 7, 5, and 3) into a van and drove to Scottsdale.

"Welcome to a new state," Unger recalls telling his young family as they drove across the Colorado River into Arizona.

With private-investor money, Unger purchased Scottsdale Manor, a 72-unit apartment complex. He set up a makeshift office in the property's maintenance garage.

"We had some very squeaky economic times," Unger says, "a lot of Hamburger Helper and tuna casserole."

To this day, Unger says he bets his own money on every project he does: "The investors need to know I'm willing to stake my net worth on my projects."

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.

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.

If all goes as Unger dreams, couples will buy wine and sit in the grass along the canal, à la Venice. Shoppers will peruse custom boutiques, à la Rodeo Drive. Young families will enjoy a water feature, à la Desert Ridge and Tempe Town Lake.

"I call him the Pied Piper of the little village down here," Jason Rose says. "For 10 years, I've seen him walking around, skirting around, talking to somebody here and somebody there, trying to get the jigsaw puzzle together."


Geoffrey Edmunds is standing on the 12th-floor balcony of a $3.5 million Waterfront penthouse, where it feels more like Manhattan than Scottsdale. The view isn't of the Chrysler or Empire State building, but of four new SouthBridge structures in fresh dirt. One hundred fifty feet below, the Arizona Canal flows past landscaped grass and a curving sidewalk.

Edmunds is Unger's competition for high-end condo sales, the local force behind Opus Corporation's Waterfront towers, which sit across the canal from SouthBridge. "Fred Unger doesn't have anything but a positive effect on our project," he says. "You can see how great the canal looks on this side. It will look just as great over there but with tables and cafes lining the water. It's nice to know Fred Unger is doing the project because you know he'll do a good job. Just look at the Hermosa Inn."

Ask any of Unger's competitors, and that's the kind of comment you'll get — a synergistic optimism about his proven taste. "It's taken years to make something of the canal," Edmunds adds. "Old Town was depressed. Now the atmosphere has changed."

Architecture is a city's visible personality. From this penthouse balcony, you can observe just how unexciting traditional Valley design is: stucco strip malls lined up like train cars as far as the eye can see.

These days, you won't find stucco going up in downtown Scottsdale. Construction sites are stocked with glass, brick, and steel instead. This brownstone Waterfront tower looks almost pillaged from Manhattan, topped with columns from Rome.

In a sense, downtown Scottsdale's recent ignition completes a full circle back to the canal that birthed the city. In 1888, Civil War chaplain Winfield Scott bought 640 acres of desert along the brand-new Arizona Canal for $2,240. Scott saw the canal as a farmer's paradise. Soon, his town was named Scottsdale. Early settlement hugged the canal, a vein of life in the desert.

Fashion Square's first arm was built in 1961. Soon after, Scottsdale's development energy drifted north, away from downtown — first to McCormick Ranch, then beyond to Shea and then to DC Ranch, Pinnacle Peak, and Troon. The best shops followed the newest, most expensive homes north.

In 1991, the Galleria was supposed to infuse downtown Scottsdale with fresh energy. After its failure (in just under two years) and the closing of Los Arcos mall (farther south), downtown Scottsdale was no longer such a shopping destination. Successful boutiques like Electric Ladyland moved into North Scottsdale strip malls just as soon as they could afford the higher rent. Fashion Square marched onward in its bland success but failed to bring energy to the surrounding area.

Now, some say Scottsdale's cultural cachet has ricocheted back south. Edmunds points to the young professionals who've purchased $2 million condos in the Waterfront. "We expected a lot of second-home buyers," he says. "We didn't anticipate the young entrepreneurs. They want this location and don't need a single-family house."

The most recent Waterfront sale, a penthouse, closed for $4.2 million. Consider that the buyer could've had a Paradise Valley or Troon mansion with twice the square footage for the same price.


After breakfast at the Royal Palms, Fred Unger drives five minutes east on Camelback to downtown Scottsdale and parks his black hardtop convertible near the new canal footbridge on Fifth Avenue.

He's greeted immediately by a mustached project supervisor from the City of Scottsdale. A crew in hard hats is plumbing the waterfalls that will cascade 10 feet from the footbridge to street level. The falls come courtesy of the city's $10 million canal-beautification project, which includes bridges, landscaping along the water, and underground parking. (The city also built and owns the Fashion Square parking garage by Nordstrom. Additionally, Scottsdale landscaped the Waterfront side of the canal.)

Unger walks past a construction truck in front of SouthBridge. "From here, you'll only see water," he says, more like an artist than a developer. Above the bridge, Camelback Mountain.

The first four buildings of SouthBridge claim as much "waterfront" land as the brownstone Waterfront towers across the canal, and they're just one of four phases that will complete Unger's project. That is, this first $41 million phase is but a tip of the $250 million, 700,000-square-foot iceberg.

Unger and the City of Scottsdale wanted a historic look and feel, as if the SouthBridge buildings evolved naturally, over the course of generations. Unger has proved his hand at historic properties. Now he's putting his trademark historic aura on new buildings.

The designs of the first four SouthBridge structures hail from different historic eras. The newest building looks as contemporary as structures in the Tribeca district of Manhattan. Next door, an early-1900s-style building is trimmed with more curving staircases than an M.C. Escher sketch. This building also has an elevator, which Unger takes to the top.

From the top floor, he points out the Mediterranean touches on a third building: "We dug through records over at the Scottsdale Historic Society, and it turns out early settlers grew grapes along the canal waters, so we built the concept around a grape-crushing house, then added an estate house where the family lived and, then, two newer buildings theoretically built later by the heirs of the original family."

The backstory plays to Unger's creative nature. It gives substance to his new project. The wrought iron around one door appears to be 100 years old. Some of the textured stonework looks equally dated. Elsewhere, a few bricks look awkwardly new. Near the footbridge, a stuccoed grate for the underground parking looks 1980s Phoenix.

Mixed-use is a term developers and urban planners employ to describe downtowns that have stores at street level with residences and offices above. SouthBridge aims for a mixed-use environment that feels as natural as San Francisco's or New York's.

Soon Unger has wandered to the contemporary, Guggenheim-esque end of SouthBridge — where architects from Allen + Philp have set up shop on the top floor. Inside, Kenneth Allen, chief architect for SouthBridge, looks a lot like Steven Spielberg. Unger, who often calls Allen on Saturday nights or Sunday afternoons to tweak ideas, takes a chair next to the architect.

Like the other executives who office here, Allen bought his firm's space before SouthBridge had scratched the canal's dirt. "When people heard Unger was doing mixed-use in downtown Scottsdale, word spread. SouthBridge sold out before Fred could advertise," he says.

Those who bought office condos in SouthBridge grasp Unger's cultural concept. They've each been hunting for a piece of Boston or Portland for decades. Now they've found it in Scottsdale, of all places.

"As the character of the buildings unfolded, we knew we'd want to be in the contemporary building," Allen says. Fittingly, glass and lime-green walls climb from metallic floor tiles toward the intentionally unfinished concrete ceiling, where pipes and electric lines gape, exposed.

Allen points past a stack of magazines (Robb Report, Southwest Style, Architect Magazine, Architectural Record) to blueprints for the residential phase of SouthBridge. At question are the end townhouse units, which will overlook the canal and point toward Camelback Mountain.

"If we combine this space to make two units, instead of three, they'll really be amazing," Allen tells Unger. Fifteen minutes later, they've decided that the three penthouses will instead be two, each with 3,500 square feet and its own elevator to two-car garages below.

"This kind of attention to detail takes longer and is more expensive. No national builder puts this kind of touch on their projects," Allen says of Unger's perfectionism.


Outward beauty is never enough, even in Scottsdale. So critics have harangued the comely Waterfront towers that sit across the canal from SouthBridge. Like Kierland Commons and Desert Ridge farther north, Waterfront's street-level retail space is stocked with chain tenants, including P.F. Chang's China Bistro and Borders.

Unger hopes his handpicked local chefs and boutiques at SouthBridge will offer an alternative and give Valley urbanites what no one else ever has. By doing so, he's making a risky move that could pay off handsomely or echo the failure of the unanchored Galleria.

"You have to do what you think is right," Unger says. "To create something very special and unique, there's no guarantee. If we had put a McDonald's there, it would be guaranteed, and the banker would be happy, and I'd make money. Instead, we're hatching seven brand-new restaurants."

If Unger has his way, downtown Scottsdale will be known for original cuisine and shopping. As SouthBridge's restaurants continue to open this month, patrons won't find a single "market-tested" chain formula. They'll instead find new culinary concepts, concocted by Cowboy Ciao restaurateur Peter Kasperski.

Kasperski is just one of the Valley culture mavens employed to make SouthBridge a unique destination. Unger and his hired guns share one trait: They've all tasted local success, but none has bitten off a project as big or unique as SouthBridge before.

Catherine Hayes, the creative pulse inside the fantastically popular La Grande Orange in Arcadia, is charged with designing the seven restaurants in SouthBridge. She put a glass modeling runway in Canal, an eatery that features fashion shows under the same roof as high-end boutiques and a day spa. Canal is so new that one patron, making her way past hard-hat construction workers, says, "It's hard to tell what's open and what's not."

At The Foodbar, SouthBridge's lower-end eatery, shoppers can walk on 1918-esque subway tiles to select a $10 bottle of wine, a $2 coffee, or a $2 bottled beer.

Acclaimed boutique owner Jennifer Croll was the next creative force to be sucked into Unger's vortex. Croll owns boutiques in San Francisco, Newport, Dallas, and three more in Scottsdale. In the biggest undertaking of her career, she's assembled 25 locally owned shops for SouthBridge, aptly named The Mix.

Croll never showed up for interviews for this story. Her business partner, Abby Traister, 28 and blond, looks the part of the Scottsdale fashionista. Traister says she and Croll ("We share a brain") immediately thought of the ritzy Fred Segal stores in L.A. when Unger explained his vision for SouthBridge.

"The Waterfront people had been hounding us to put in a boutique. We didn't like that it was facing the parking garage. We started looking around, and the name Fred Unger kept coming up," Traister says. "Unger transferred his vision to create a true walking district, not just a Banana Republic, Starbucks, and Borders."

The concept of connected stores at SouthBridge grew into 22,000 square feet of designer boutiques, encompassing three categories: home, fashion and play. The boutiques, each at a different price point, just opened and are scattered among the street-level restaurants. One shop, Angelic Grove, operates a big-city-style flower stand. Another, the Grand Tour, sells the treasures of an owner who brings crates of antiques from Europe.

The Garage sells children's clothing, including onesies that say "I crawl the line" and "iPood."

The new energy in downtown Scottsdale has lured Traister to all but abandon her McDowell Mountain Ranch home to live in a condo at the Valley Ho, just around the corner from SouthBridge.

"It's so nice to sit outside on a high-rise balcony at night. I never thought I'd get to feel that here in Arizona. I thought I'd have to go to New York or San Francisco. It's smaller, but it's here," Traister says. "This whole area is turning into a truly connected walking district, whereas 10 years ago, it was a lot of turquoise and Indian shops."

Traister admits it's difficult to create a top-notch collaboration of boutiques without a single national-chain tenant. "There's a reason all the other developers don't do this," she says. "It's hard."


Standing among the stacks of color architecture books in Unger's office, it's evident he is more Andy Warhol than Donald Trump. Most developers hire designers to create the look of their buildings. They spend their days with spreadsheets and executives and golf clubs. Unger prefers sketchpads.

For Unger, meetings are things to be endured — unless they relate directly to the finished look and feel of his vision. "I'm not a national developer who's hired a team for a remote project. I live here and work here in the Valley," Unger says. "I also have the luxury of not being beholden to stockholders at a public company, where earnings are the bottom line."

That luxury has afforded Unger a go at riskier endeavors. After the defeat of the Canals in 1999, Unger vested himself in two other projects that never materialized: The Monroe, an old hotel that Unger hoped to refurbish in downtown Phoenix, and Castle Hot Springs, a Valley resort with more history than the Royal Palms or Hermosa. Bankers backed out of each project.

"When I walked into the Monroe for the first time, it had been vacant for 22 years," he says. "Beneath the cobwebs and time, you could see the 38-foot ceilings. I thought, 'Gosh, wouldn't this make a great hotel?' So often, I lead with my heart and then I try, to the best of my ability, to put it together financially with lenders and equity partners, but it doesn't always happen because the costs of what I do are so much higher than building a normal new building."

Those high costs are reflected at SouthBridge, where nearly every door, doorknob, and functional window costs far more than the standard stucco, steel, and sealed windows found across the Valley.

"If we don't do unique spots," Unger says, "we're going to be like Anytown, USA."

Unger does own a handful of "Anytown" properties outside Arizona — apartment complexes and industrial parks across the Southeast. But he isn't particularly drawn to them.

"Those aren't the things you'd drive your kids to and say, 'I had a hand in this.' I'm certainly more proud of what we've done at Royal Palms and Hermosa," he says. "I'm sure hoping SouthBridge will be a similar success. [SouthBridge] is an opportunity to leave a lasting impression."

Only about half of Unger's projects work. "Often, conventional wisdom says they're not economically feasible. They take longer and cost more, so about half of what I try I'm able to pull off."

Such was the case with Unger's first run at downtown Scottsdale's canal. The vision was just too big and required too much politicking to pull off.

In retrospect, Unger says the defeat of the original and gargantuan Canals of Scottsdale project was probably for the better. He quotes a Garth Brooks lyric: "Sometimes I thank God for unanswered prayers."

But when Unger's dreams do get off the ground, they tend to work. And not just because they make money (which they do), but because Unger's properties offer an experience beyond concrete and metal — much the way a great film offers an experience beyond actors and sets.

"When I first thought of the Canals, I was up to my chin trying to get the Royal Palms finished. I was over budget and delayed. I was the laughingstock of some of the real estate community," Unger says.

Obviously, nobody's laughing about the Royal Palms now. Nobody's laughing about SouthBridge either, a concept that's on schedule and on budget.

Behind the circular glass table Unger uses as a desk, 11 giant seedpods are framed in a white rectangle on the wall. The pods, from a tree in Thailand, look like edamame, except that each is three feet long, with bowling ball-sized seeds.

The analogy to Unger's new project is evident. Some seeds sit under soil for years before showing the first sign of life. The seeds of downtown Scottsdale's revitalization may well have been planted 10 years ago, when Fred Unger walked behind that tattered art gallery, looked at the canal, and had an idea.

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1 comments
aikanae
aikanae

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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