'Slums into gold': Asian immigrants bring new economic life to Phoenix area

Maria Polletta | The Republic | azcentral.com

Show Caption Hide Caption Mekong Plaza Mekong Plaza in Mesa is bringing new economic life to the Phoenix area. Asian immigrants are the fastest-growing group of migrants in Arizona and the nation.

Arizona is second in the nation for Asian population growth, with more than half of Arizona Asians born abroad

Many Asian immigrants have concentrated in Phoenix's southeastern suburbs, primarily Mesa and Chandler

Asian entrepreneurs have taken on and turned around once-undesirable properties, creating vibrant economic centers

Asian immigrants are coming to Arizona in larger numbers — either directly or after observing the high cost of living and "saturated ethnic markets" in California and New York. As of 2012, Arizona was second in the nation

Two hours into Sunday dim sum, Mesa's Mekong Palace is packed.

Servers weave through the constellation of diners, pushing carts packed with small plates typical of the Chinese brunch. Patrons snatch fresh barbecue-pork buns, sweet red-bean twists and fried shrimp balls as waiters drop off steaming pots of jasmine tea.

The cacophony of conversations — at 30-plus tables, in at least four languages — is deafening. Many other couples and families wait for a spot.

"Number 44?" the hostess calls out to the line haphazardly wrapped around her station. "45?"

Customers who don't want to wait are steps away from more than 10 other dining options. The larger Mekong Plaza has Vietnamese, Japanese, Filipino and Thai eateries, plus a Taiwanese bakery, jerky shop and boba cafe.

A sprawling international supermarket, travel agency, dental office and hair salon — all catering to Asian customers — nestle between restaurants.

"It's all family-owned-and-operated businesses here," said property manager Steven Diep. "This is really the Asian food and cultural center of Mesa."

MORE: Mesa's international markets anchor vibrant Asian dining scene

It wasn't always. A decade ago, the building was a dilapidated former Target hurting for a makeover.

Even after Diep's family bought, redeveloped and reopened the center, they operated at a hefty loss for three years, he said. As an increasingly diverse influx of Asian immigrants made their homes in Phoenix's southeastern suburbs, though, once-struggling centers like Mekong Plaza began to prosper.

Today, the 100,000-square-foot mall is at full occupancy and has spurred development along a roughly 2-mile stretch of Dobson Road, creating a vibrant corridor that has drawn national players to the area.

RELATED: Mega international market coming to Mesa

The thriving sector represents a fraction of the economic impact that Asian immigrants — the fastest-growing group of migrants in Arizona and the nation — have had on the state.

Asians own more than 22,000 businesses in Arizona and employ 42,000-plus residents, according to the Arizona Asian Chamber of Commerce. They generate $6.1 billion in revenue despite making up 4 percent of the population, the chamber said, with many entrepreneurs taking on and turning around undesirable properties.

"Our tenants take pride in their work, and they're always trying to improve," Diep said. "America was built on the dreams of people like them."

'Working, working and working some more'

It was a chance at the American dream that convinced Chan Tieu's parents to send their 14 children thousands of miles away from South Vietnam four decades ago.

When Saigon fell to North Vietnam's communist troops in 1975, the Ca Mau fish-sauce manufacturers began splitting up their sons and daughters, bribing boaters with gold to help them escape.

Tieu was in the third of four groups, spending two years at a Malaysian refugee camp before coming to the U.S. at age 11.

"It took us 20 years to get the whole family together, but we all got to America," said Tieu, now 49. "The objective was always America."

Tieu grew up, went to school and established a career as an engineer on the East Coast. But he couldn't relax without a "backup plan to the backup plan to the backup plan."

He broke into the restaurant industry in 2002, selling pho — a classic Vietnamese broth-based soup with rice noodles, meat and vegetables — at Virginia Beach. Six years later, he replicated the concept in Arizona with Unphogettable, one of Mekong's original tenants.

Tieu has continued to balance a full-time engineering job with restaurant management, and will open another location near Lee Lee International Supermarket in Chandler later this summer. "My American dream is working, working and working some more," he said.

I AM AN AMERICAN: Read the stories

Though Tieu immediately saw potential in the Mekong model, he said some people scoffed at the setup when the plaza opened. "Who the hell would go to the supermarket, go out to eat and go clean their teeth at the same place?" he recalled them asking.

"I felt like, 'You kids don't even know.' When you are (an immigrant) who has only one day off or a half-day off, you want things to be within walking distance," Tieu said. "That’s why this kind of business model is so successful. You’ve got to please people who don’t have time."

Tieu was similarly blunt about immigrants' willingness to take on run-down sites to get an economic foot in the door, saying he has watched Asian entrepreneurs "turn slums into gold" throughout the country. In a 2016 study, about half of Asian entrepreneurs said they established their Arizona businesses during or just before the recession.

Mesa's Asian business district started with a large inventory of vacant or underutilized retail space, progressed to a handful of modest restaurants and eventually attracted big names. H Mart, the "IKEA of Asian supermarkets," and Lao Sze Chuan, a Sichuan restaurant run by one of the country's most prominent and controversial Chinese chefs, are among the latest additions.

Standing out as others move in

The creation and evolution of Mesa's Asian corridor reflect recent trends in Asian immigration, according to Aggie Noah, assistant professor of Asian Pacific American Studies at Arizona State University.

First, Asian immigrants are coming to Arizona in larger numbers — either directly or after observing the high cost of living and "saturated ethnic markets" in California and New York. As of 2012, Arizona was second in the nation for overall Asian population growth, with more than half of Arizona Asians born abroad.

Next, the clustering of Asian immigrants in Mesa and Chandler illustrates "the unique residential settlement patterns of Asian immigrants" known as ethnoburbs, where immigrants flock to suburban areas rather than major downtowns, Noah said.

When Asian immigrants concentrate in one area, they create demand for businesses geared toward their habits and preferences.

Mesa resident and Taiwanese immigrant Ada Tsai, for instance, said she shops at Mekong Supermarket because it "has the products I'm comfortable with and used to," including hard-to-find Asian vegetables and imported seafood.

The phenomenon of immigrants snapping up and transforming cheap properties spans the socioeconomic ladder, Noah said.

Wealthier Asian immigrants have the resources to pursue real-estate flipping for a profit, while the discrimination that poorer immigrants face based on race, citizenship status and English proficiency often limits their options to inexpensive areas. Though Asians are more likely to have citizenship than members of other immigrant populations, an estimated 13,000 Asian immigrants in Arizona do not have legal status.

Finally, ethnic businesses beget more ethnic businesses, which provide "collective support" for each others' employees.

When Noah worked at a Korean restaurant, she said staff would simply walk across the street to get ingredients, something you "can’t do … with your typical American stores because they don’t carry the ethnic things you need."

As Mesa's Asian corridor continues to boom, business owners in the district seem acutely aware the market will eventually reach saturation.

They know there are finite numbers of properties and customers, they say, and they will have to offer high-quality or one-of-a-kind services to stay in business.

"As H-Mart and others move in, can all of us survive? I think that's what everyone wants to know," said Tieu, the engineer turned restaurateur. "The problem with having a successful model is that others will try to replicate it."

READ MORE:

I Am An American: Tara Ijai: Muslim woman sees world through heart-shaped glasses

Immigration crackdown hurting U.S. economy, Federal Reserve official says

See how 'Day Without Immigrants' protest affects Arizona

Food-service jobs saw record first-quarter jump in Arizona, despite wage increase