Rivulon to Get First Retail ShopsMay 21, 2015
The steel skeletons of two office towers rising along the Santan Freeway are the clearest signs of progress on Gilbert’s massive Rivulon project, but the future employment center is also set to get its first retail shops by year’s end, according to the developer.
Nationwide Realty Investors, a real-estate arm of the well-known insurance company, plans to start construction soon on a 17,000-square-foot retail building near Gilbert Road and Rivulon Boulevard, just north of Loop 202.
Floor plans submitted to the town show space for about a dozen businesses, likely including restaurants and other retail services to support the hundreds of office workers who will begin moving into the development later this year, according to the company. An LA Fitness gym last month became the first business to open at Rivulon.
Meanwhile, construction is moving forward quickly on 275,000 square feet of office space on the southern end of the project, overlooking the freeway. Isagenix International, a network-marketing company that specializes in health products, is preparing to move its corporate headquarters and about 400 employees from Chandler to a new three-story building at Rivulon in December.
Nationwide is also building a four-story speculative office tower next to the Isagenix building, with construction set to wrap up in September. Company President Brian Ellis said there’s been interest from a broad range of companies but no new tenants to announce yet.
Eventually, Nationwide expects to invest about $750 million in building more than 3.5 million square feet of office and retail space in Rivulon, which covers nearly half a square mile between Gilbert and Lindsay roads along Loop 202. Ellis said there is probably enough room for multiple hotels, and the company officially lists 250 hotel rooms among its plans for Rivulon.
Nationwide Realty Investors is an Ohio-based company that locally developed Scottsdale’s Gainey Ranch Corporate Center. The company’s portfolio also includes the Arena District in downtown Columbus, but the Gilbert project is one of its larger undertakings.
“This project is a very high priority for our organization,” Ellis said. “It comes up everyday, literally.”
Two major contributions from Gilbert and the state helped make the Rivulon project possible — the opening of Loop 202 in 2006 and the Town Council’s approval of a $35 million tax incentive in December 2012.
Beginning with an influx of hundreds of jobs with Isagenix, LA Fitness and other early tenants, Rivulon could eventually bring 15,000 jobs to town, Ellis said.
“This opportunity was born out of (Gilbert’s) growth, but frankly, it was development of the infrastructure, the access and visibility of (Loop) 202,” Ellis said. “If it wasn’t for the freeway, we would have invested somewhere else.”
In offering the public incentive, Gilbert agreed to refund half of the general sales tax and all of the construction sales tax generated by the Rivulon development over the next 20 years, with a $35 million cap.
The sales-tax rebates are intended to reimburse Nationwide for improving roads adjacent to and in the development. The deal is structured to include more rapid payouts if the company builds denser, vertical buildings and penalizes Nationwide if it builds too much retail.
The incentives are also tied to performance, since the Rivulon development has to begin producing tax revenue before any money can be refunded. Gilbert will award the funds only as Nationwide completes new blocs of at least 100,000 square feet of office space.
Isagenix, a privately held business that reported more than $500 million in revenue from April 2013 to April 2014, was the first office tenant to commit to Rivulon and will occupy 150,000 square feet. Founded in 2002, the company has operations in about a dozen countries and has done more than $2 billion in sales with products in weight-loss, energy and anti-aging.
As part of a multilevel direct-sales company, Isagenix associates earn money by selling the company’s health products, enrolling other associates and receiving commissions from teams they assemble beneath them. Amway is one of the best-known multilevel marketing companies.
While Isagenix is bringing jobs to Gilbert, some could argue the move doesn’t benefit the region as a whole since the company is leaving Chandler. Ellis said he remains confident Rivulon will attract companies from outside Arizona to relocate in Gilbert.
“One reason we are willing to invest at the levels we are here is the belief there will be companies that will come to Arizona, to Gilbert and to Rivulon,” Ellis said.
Rivulon project timeline
February 2006: The Gilbert Town Council annexed the land on the east side of Gilbert Road, between Pecos Road and the Santan Freeway.
October 2006: The Gilbert Design Review Board approved plans for the 68-acre Gilbert Esplanade project on the property, an office and retail project that later fell through.
November 2009: The Rivulon development by Nationwide Realty Investors is introduced to the public along with other large-scale projects at an economic forum organized by Gilbert Mayor John Lewis.
December 2012: The Gilbert Town Council approves a $35 million tax rebate for Nationwide as part of a development agreement for Rivulon.
July 2014: Nationwide Realty Investors announces that network-marketing company Isagenix International, currently located in Chandler, will relocate its headquarters and 400 jobs to Rivulon as the development’s first major tenant.
April 2015: LA Fitness becomes the first business to open at Rivulon.
September 2015: A four-story speculative office building is expected to open with about 125,000 square feet of space.
December 2015: Isagenix is expected to move into its new corporate office in a three-story, 150,000-square-foot building at Rivulon.