The LIVING Interview- Pat Johnson: The Right Track

Interview by Bea Lueck

There’s a real irony about racetracks – they’re slow. Well, when it comes to developing them, anyway. But Pat Johnson, President of Danrick Builders is on the right track. Along with his business partner, Dan Erickson, Johnson is driving plans forward for Attesa, Casa Grande’s long-awaited ultimate motorsports technology lifestyle community. With construction slated to begin on the $1.5 billion 15-year project this summer, we caught up with Johnson to learn more about his journey from CPA to racetrack owner, his roots in our community and, of course, the details of his largest venture yet.

GC LIVING: Hello, Pat. Tell us about you. How did you get into this type of developing?

Pat Johnson: When I got out of college, I went to work as a certified public accountant. I had been working with a number of people in the area, including John Wayne. Eventually I ended up moving to Casa Grande, and as a result of moving to Casa Grande, I got involved with a number of different people here, and loved this area. One of my friends invited me to go up to Lake Tahoe. And at Lake Tahoe, one of the owners of PIR was up there, and he and I started talking. He said he wanted to sell, and I said, “Maybe I know how to get it bought.” And 30 days later, Buddy Jobe – another client – and I closed on the real estate that is now PIR. I was out there for a while, left PIR, went on to the East Coast and did a lot of property development and land development, both in Delaware and then Florida.

I came back out here, and I worked with a couple of different developers. I knew about the auto racing business, because I loved it when I was doing it, and started looking at it with another friend. We started looking at the development of a race track.

I convinced the gentleman I was working with at the time to take a look at Casa Grande, and we came down here. I was familiar with Bianco Farm. I was familiar with the location. The fact that it has two freeway overpasses and whatnot is what got me interested in that site. That was about 2008, and something happened in the economy during that period.

GC LIVING: Yeah, just a little hiccup.

Pat Johnson: [Laughs] Yes, and so money was not available, but we did have a property in escrow, and I had gone to the county, introduced them to the concept of the project and, in fact, done a comp plan change on a lot of the property before it became evident that money wasn’t going to be available. So, we just kind of shelved it, and the escrow collapsed…we didn’t close it. Then I was up in Las Vegas doing consulting work, and I got a call from (now business partner) Dan Erickson.

He said that he was interested in building a racetrack. And I thought, “Ah, another one of those guys.” But I met with him, and he was serious. I explained to him what I was thinking about. He wanted to do a 200-acre private club, and I said, “Well that doesn’t make any sense. The money doesn’t pencil. You have to do more than that, because by the time you get all your entitlements in place and all the things that you have to do, the cost just goes through the ceiling, and you’ve got to be able to spread that cost over more events and the real estate.”

So we started out with buying 1,800 acres, and then we bought another 600 or 700. And I think the only thing we have left to close on now is 140, so we’ve got about 2,512 acres altogether.

GC LIVING: So, that’s about four square-miles?

Pat Johnson: Yes it is. It stretches from Bianco Road to Montgomery Road, and from Hanna Road to the Tohono O’odham Nation on the south. So, that’s how it started. We started talking about this and developing it. That’s kind of how I got to where I’m at now.

GC LIVING: Great, thank you! Now, let’s start at the beginning. Where were you born?

Pat Johnson: I was born in South Dakota, and lived there until I was about 17. I came back to Arizona, to Yuma, and got married when I was 19, then moved back to South Dakota and became an underground gold miner. [Laughs]

GC LIVING: I’ve heard of the above-ground methods, but underground?

Pat Johnson: Yeah, I was actually working at 4,850 feet underground – vertically down – in the largest gold mine in the western hemisphere.

GC LIVING: The first question that comes to mind is, why?

Pat Johnson: Well, you know, it was funny. That was created in the late 60s, and finding jobs that you could support yourself when you’re that young was difficult. I got up there and I could work straight night shifts, so I worked Monday through Saturday and I could have my days free, so I went to college during the day.

GC LIVING: What college did you go to?

Pat Johnson: I started at Black Hills State College. Both my wife and I went there. She worked as a waitress. I worked in the mine, and we paid, I believe it was, $75 a month rent. [Laughs]

GC LIVING: What did you study?

Pat Johnson: Accounting. I graduated from ASU in 1973.

GC LIVING: So then you took the exam and became a CPA?

Pat Johnson: Yeah, I worked with a firm in Phoenix called Walmsley, Eikner & Pelley. They’re no longer around. At the time Lewis Walmsley had all of John Wayne and Louis Johnson’s holdings down here and a number of other agricultural interests in the area. When I left the firm, one of the feed lot entities, the Benedicts, had asked me why I was thinking about leaving and why didn’t I consider Casa Grande. They were generous enough to help me get started down here. We had a lot of agricultural clients in the area and eventually, when the opportunity came up, I sold that firm to Henry & Horne, then I went with Buddy Jobe and bought PIR.

GC LIVING: So you worked with both Louis Johnson and John Wayne?

Pat Johnson: Yeah, a little bit. Not so much directly. Remember, I was the peon in the firm. I met John and I met his son Michael, and I met Louis on many occasions. And even after I moved down there, I did some work for Louis’ wife Alice directly, and I was at their house a number of times, so I knew Louis before he passed away.

GC LIVING: Have you always had an affinity for racing, or did you do any racing?

Pat Johnson: No, I never did any racing myself. On my own at PIR, I did a couple of what we call “hot laps” around them – what I thought were hot laps – by myself, and I discovered that just because it’s a racetrack doesn’t mean you can drive faster. [Laughs]

GC LIVING: Do you have a favorite? Is it NASCAR? Is it Indy?

Pat Johnson: You know, it varies. I’ve always had an affinity toward IndyCar racing, open- wheel road-racing, and that’s why the track we’re looking at building is going to be a road course, not an oval. But NASCAR and NASCAR racing has always been fun for me. I was lucky enough to meet several of the people a few years ago – Neil Bonnett, Dale Earnhardt Sr. and Richard Petty…

GC LIVING: Right now, NASCAR has one road race on the East Coast and another in Northern California. Do you envision NASCAR coming to a road course in Arizona?

Pat Johnson: Yeah, we’re here [Laughs], and that’s up to NASCAR. We will be capable, certainly, of hosting a road race here. But whether or not we’d ever be asked to, I don’t know.

GC LIVING: So we have the road course. What else do you envision for Attesa at completion? And is it all done in phases?

Pat Johnson: Yes, the first phase is relatively large, because the first track is designed to be able to do the bigger racing events – everything from motorcycle racing to NASCAR, the IndyCar Series, sports cars, any kind of a race event. During the week and when we’re not doing events, we’re planning on having the tracks surrendered to people who need to test.

In the United States the road courses that are available for rent, all of them are 100 percent leased out. Basically, there’s very little available out there for people to test. Arizona’s particularly suitable for it, because during the summertime, that’s when the guys need to test batteries, brakes, shock absorbers, tires, anything that needs hot-weather testing. We also created industrial parks adjoining the track, so this area will allow race teams and manufacturers to test. Basically, a company can come in, have their own building and move their vehicles onto the track when they need to test it.

Most of the tracks in the United States right now, if you want to do that kind of thing, you’re going to have to put all your stuff on a transporter, haul it over to the track, hope it doesn’t rain, or whatever, and then get your timing. With our facility, you’ll be able to have the building and everything right there. So, you’re going to attract a certain quality of engineering-type people to do this testing. A very good employment base is what we’re hoping to bring through that.

So, that’s the industrial park and the race track. There is a plaza area that sits between two of the race tracks that is designed to provide areas for people during the races, the sessions and that kind of thing, but there, the non-racers will be able to do different events within that.

We have another area that’s designed exclusively for events. It’s got a dirt floor, so we can do dirt-track racing within that facility. That is for things like Lucas Off Road Racing, motocross, any of those kinds of events, but it’s also able to handle concerts.

The facilities themselves are bermed. There’s a berm around all the facilities, all the racetracks, here that is 25 feet high. The tracks themselves will go from grade to 75 feet below grade on the primary track, and 35 feet on the secondary track. What that did is it dropped our noise levels to 65 decibels outside of the tracks, and that was according to a study we had done by LA-based engineering firm AECOM to make sure that we could maintain a nice atmosphere around us and not have somebody yelling at us six months after we move in.

We’ll have a parking area for 14,000 cars. We have a secondary track, which is used primarily for the driving club-type of event, where you’ve got a private club atmosphere with a race track, instead of a golf course. We also have a partner for a 330-room resort hotel and that would sit right on the plaza area, right by the racetracks.

We have an area for housing for the private club. Mainly, it’s a home that’s mostly a garage, and then the upper area is for living, so you could live there. For most of the people, it would be their second home.

Then we have an area that we’re going to call a Branding Center, which is for experiential marketing. If you’re selling cars and you have a high-speed car that you want to sell, or if you have a four-wheel drive vehicle that you want to show off, you’ll be able to take your customer there and use that facility to show off what it can do.

Attesa will also have a larger lot residential area that will allow residents who own planes to have direct runway access. The runway is 6,500 feet long with an FBO (fixed-base operator) that’s right there for them. So, part of it is dedicated to industrial, but it’s mainly for homeowners. Again, that’s to service those people who want to come in for the club activities and, say, fly in from Southern California, and they can land on the airstrip and store their cars right there, and then move their plane in there when they’re here. We put the cars over at the garage. There is a huge amount (of offerings) and it’s a 15-year project.

GC LIVING: Over the initial phase of the project, which is the construction, approximately how many people do you think you’ll be employing at that time?

Pat Johnson: You know, we have a study that Elliott D. Pollack and Company did, and he came up with a number of around 9,000 people for construction. I’m going say that during the first phase, it’ll be about half of that, maybe a little bit more.

GC LIVING: Let’s go back to the track. So, the road course, how long is it?

Pat Johnson: 2.8. miles. And it’s designed to meet the top international racing specs for safety, for both cars and motorcycles.

GC LIVING: So, after the 15 years, what are you going to do next?

Pat Johnson: Well, by the time that goes by, I’ll probably be retired. My partner Dan, on the other hand, he is a younger man, and Lisa Mitchell, who is our Vice President, she is very active in everything we’re doing, and I think she will also want to move forward with the company, and I’ll move to the side as we hit 15 years.

GC LIVING: So, do you consider yourself a developer or a racer?

Pat Johnson: Well, it’s interesting, because you go to meetings of the county or the city or whatever, and on the one hand, we’re developers, and on the other hand, we’re end-users. So it’s kind of a combination of both with this particular deal. Your traditional developer will come in and build it, and not have anything to do with anything – they’ll just sell the lots and move on to develop something else. In our case, we’ll have some development that we sell, but we’ll still be there, because when the racing starts, we’ll be involved in both.

GC LIVING: Let’s touch on the process of this group of the state level, county level, city level, even though it’s not within the city limits, it’s in their development area. Have there been challenges?

Pat Johnson: Yeah, overall pretty good. The biggest challenge has been water. Overall, the city has been very supportive of what we’re doing. We’ve worked with them on a 208 issue, which really wasn’t a major one for them. We have kept them in the loop. Of course, there is also the state, but the other one that wasn’t mentioned was the Tohono O’odham Nation, and we’ve been working pretty extensively with them, because we have a two-mile border with them. They are very positive about what we’re doing, and they’re our neighbors, so we’re keeping them apprised. I want to have a good relationship with them.

GC LIVING: Now, Arizona has a long-standing history of automotive testing. This area is great for automotive testing, because of our weather and sunshine.

Pat Johnson: Yes, that’s very true, and those are the same reasons that brought General Motors here, and Nissan here; Chrysler is here; Volkswagen is here, and Volvo is here. The same reasons that they saw Arizona as a valuable place to be is the same reason that we feel that we’re on the right model. Keep in mind, for the most part, the big facilities like the GM or the Ford or any of those, they’re locked. They’re locked to anybody in the mid-market range, because they won’t let them in. That’s the main thing. And a state-of-the-art test track is too expensive for one company to build for themselves.

So, we’re looking at the guys that are developing new technologies. They’re smaller, more innovative, but some of the bigger engineering facilities are not big in terms of the automotive world. Even a test facility that covers up to 700 acres with a lot of buildings on it for engineering is not big in the automotive world, because of the way they are. So, those opportunities with the smaller and medium-sized firms, who need a place to go, we think is very important.

GC LIVING: Is there any public component where a couple of guys or a group of car enthusiasts can say, “Hey, we want to take our cars out and race?”

Pat Johnson: You know, we are going to have some open track days. We do have that on our schedule. The weekends become open, and those are the times when we’ll have events that are more tailored to individual things. And how we’ll do that, we haven’t decided. We don’t know if the idea is we’re going to set up a system, or you can pay to come down and so much for a day or so many laps, or whatever. I have not fully fleshed that out yet, but there will be opportunities.

My partner is very dedicated to the Sports Car Club of America, and he races in that. He races a Formula Mazda, I believe. It’s an open wheel car. It looks like a little Indy car. They call them little, but they still do 160 miles an hour, so… [Laughs] I guess that’s fast enough.

GC LIVING: [Laughs]

GC LIVING: So, the project has been well-publicized and discussed within the county. You actually met with the different supervisors and their constituents to discuss the project.

Pat Johnson: Yes, we had several public hearings. We’ve had one in every district, along with meeting the supervisors individually to tell them what we’re going to be doing, and explain the project in detail, because, as you can tell, it’s a massive project with a lot of moving parts. But we also had a number of neighborhood meetings out in the area, and although almost nobody lives out there, that’s within the county requirement. We went out an extra two miles almost from the site.

We had a number of people out at the meetings. And I think, for the most part, all of them were very much in favor of it. We’ve been before the community board that gave us approval there. I think we had one abstention, and the rest of them were positive for it. We’ve had a number of hearings before the planning and zoning people, and again, it’s been very positive. But we’ve been kind of an open book on what we’re doing, and telling people there’s a website up at attesa.com that explains a lot of what we’re doing. I’m usually available by phone. I’m not that hard to get a hold of.

We’ve tried to do this in a manner that is consistent with the environment. We’ve had biological tests done. We’ve tried to work with our neighbors, as I mentioned earlier, with the Tohono O’odham Nation. We have talked to just about everybody around us. And, these are difficult projects, but I think we have accomplished a tremendous amount trying to keep our project – I’m not going to say green – but at least not black, you know? We’re doing the best with that we can. We’re planning on developing everything with leading standards and sustainability.

GC LIVING: When do you anticipate the real part of construction? I mean, there’s been so much work done, even going back to 2008, testing and studies and the engineering.

Pat Johnson: Originally, I was hoping that we could get out of the ground this coming spring. With a couple of more recent delays, with some of the planning and the doing, it looks like it’s going to be the third quarter 2018. I’ve got a lot of dirt to move out there, and so what we’ll do is give the county our preliminary plan, and then we go in and have it at-risk graded, and if they come back and say, “Well, you gotta change this,” then it’s on us. So that’s how we plan to get a step up.

GC LIVING: As we get ready to close here, I have another fun question. In a perfect world, if you were to wave your magic wand, when’s the first race?

Pat Johnson: Well, three years from, say, September of ‘18, so three years from that is, what? ‘21?

GC LIVING: Do I get seats?

Pat Johnson: Well, of course. Yeah, you have to have seats! But, regarding time frame, there are so many people out there who don’t have the entitlements in hand, they just have dreams, yet they’re trying to get races. I have had some meetings with people from the various race sanctioning bodies, but the caveat is that none of them really are serious about you until you bring them around, and show you are real. And it takes about two years to three years to get on their schedule, because they have to shuffle things around, and they really have to want to come to you. But once you get on that schedule, if you’re not ready, oh my goodness, are you in trouble. [Laughs]

GC LIVING: This is truly, “Build it and they will come.”

Pat Johnson: That’s for sure. And there’s always a guy with a set of plans under his arm, saying to race people, manufacturers and performance companies, “If you’ll give me the contract, I’ll build it.” Well, that isn’t how these guys work. It’s the other way around. [Laughs] 