Phoenix Business Journal

Axon Enterprise Inc. finally has the green light for its long-anticipated headquarters campus.

Scottsdale City Council on Nov. 19 approved five items related to the 70-acre mixed-use project, paving the way for one of Arizona’s largest public companies to build a sprawling, $1.3 billion tech-focused campus it believes will help it compete for talent against blue chip companies such as Apple and Microsoft.

The project is expected to eventually feature 1,895 residential units, Axon’s 250,000 square foot headquarters building, a 435-key hotel and up to seven restaurants, among other features.

Council approved the headquarters proposal in a 5-2 vote, with Vice Mayor Barry Graham and Councilwoman Kathy Littlefield voting against. Mayor David Ortega, Councilwoman Tammy Caputi, Councilman Tom Durham, Councilwoman Betty Janik and Councilwoman Solange Whitehead voted in favor. The package included a minor general plan amendment, a rezoning, a development plan, a development agreement and an amended public infrastructure reimbursement agreement.

The current rezoning cases were submitted by Axon (Nasdaq: AXON) to the city of Scottsdale in August 2023, though there was a lengthy pause in the process throughout 2024 after the maker of Tasers and body-worn cameras faced significant pushback from community members about its plan to build thousands of residential units on the campus.

Axon’s new HQ: Bulls vs bears

The Council vote on Nov. 19 followed roughly four hours of debate and testimony. More than 50 members of the community — including bullish Axon employees and bearish neighborhood leaders — spoke passionately about a project that has been a lightning rod in the community.

Proponents of the plan cited the desire for a transformational project that would reward a homegrown Scottsdale company wanting to build a massive mixed-use campus in its home city — and has worked in earnest with city officials over the past year to improve the plan ahead of the rezoning decision.

“The zoning change isn’t an assault on our residents, it’s our superpower,” Whitehead said. “The zoning change is what gives us the ability to negotiate with Axon, that could otherwise build whatever they want.”

Opponents cited the density of the project’s residential component and an expected increase in traffic among their primary concerns. Littlefield pointed out that “pretty much 100%” of the emails the Council received from residents urged them to say no to Axon’s plans.

“This is not where apartments should be built,” Littlefield said. “I don’t object to the apartments, per se, I object to the location.”

Ultimately, a majority of the Council concluded that a series of plan changes made by Axon over the past nine months were enough to earn their support. That included a 23% reduction in the number of residential units, a major road realignment to offer a buffer to the nearby Stonebrook II neighborhood, the removal of a controversial roundabout, increased setback distances and upgraded landscaping.

Scottsdale partnered with Applied Economics to conduct an economic analysis of Axon’s plans. It found that the company’s plans would have a direct impact of $4.6 billion over 10 years, according to Scottsdale Economic Development Director Teri Killgore.

For its part, Axon conducted a study through Rounds Consulting Group that estimated its expansion in Scottsdale would have a $38 billion total economic impact between construction and operations after 10 years.

“I spent the first seven years of this job figuring out how we were going to make payroll at the end of the month,” said Axon CEO Rick Smith at the Nov. 19 meeting. “Now I get to stand up here and, with a straight face, tell you we’ve got a shot of almost $40 billion of economic impact.”

The project is also expected to bring an additional 650 jobs to Scottsdale, while Axon has reached agreements to bring 950 million gallons of water to the community, Killgore said.

She described the project as a “regional, national and even international draw” that “aligns with our strategic vision in several ways.” That alignment extends to compensation; Axon has said that it has an average target employee annual compensation of $135,248 in Arizona.

“Our standard in economic development and as a city is to bring in jobs that exceed county median wages by 185%,” Killgore said. “This project meets and even exceeds that goal.”

Background on Axon’s big win

Founded in 1993, Axon has grown into a behemoth in recent years with a market cap in excess of $46 billion.

Plans for the campus have been in the works since at least 2020, when Axon purchased 74 acres in north Scottsdale from the Arizona State Land Department for $49.1 million.

Axon assuaged some of the lingering community concerns with a series of improvements it unveiled at the Nov. 13 Scottsdale Planning Commission meeting, which resulted in the body unanimously recommending the updated plan.

At that meeting, Axon agreed to reduce the number of proposed residential units at the campus by 23% from 2,552 to 1,965, a mix that includes 365 condos and 1,600 apartments. Axon has also reshaped the site with more of a campus vision in mind — one example is adding green roof structures to improve pedestrian access and enhance the connection between its headquarters building and the residential component of the site.

Ahead of the Nov. 19 vote, Axon agreed to further concessions. The company agreed to a stipulation that would decrease the number of residential units at the campus by 70, to a maximum of 1,895 units. Axon also agreed to enhanced landscaping that would require it to “coordinate with the Stonebrook community to the south on the design and landscaping of a berm, between the Axon campus and the Stonebrook community, with final design, location and dimensions subject to Development Review Board approval,” according to a city memo.

Other campus features include a 1.5 mile running trail; a 13,000-square-foot dog park; and 49,486 square feet of restaurants and retail. A 435-key hotel — more than four times the size of the original hotel plan — is considered an essential component for Axon as it attempts to transform the north Scottsdale site into “the epicenter of public safety globally,” Smith said at the Nov. 13 meeting.

Within five years from the confirmation of the plan, Axon is required to build 250,000 of commercial or manufacturing space and reach a payroll of $130 million. The plan also calls for the city to reimburse Axon up to $9.4 million for infrastructure improvements at the north Scottsdale site, which is near Axon’s existing headquarters building at 17800 N. 85th Street.

Axon is among the most powerful companies based in the Valley. It’s the eighth largest employer within Scottsdale, and projects to employ 1,500 at its new headquarters campus at full buildout, according to Taylor Reynolds, principal planner with the city of Scottsdale. The company has also been a Wall Street darling in 2024 as its stock price has skyrocketed 136% to more than $610 per share.