Salt Lake City and the Wasatch Front get their star turn in a CNBC prime-time special set to premiere Tuesday at 8 p.m. MST, the latest installment in the business news outlet’s “Cities of Success” series.
CNBC’s Carl Quintanilla hosts the hourlong program, exploring the drivers behind the area’s “unprecedented rise”, featuring insights with leaders from Utah government and the business community including interviews with Utah Jazz and Utah Hockey Club owners Ryan and Ashley Smith, former Utah Gov. Mike Leavitt, Larry H. Miller Company CEO Steve Starks, Vivint founder Todd Pedersen, emerging entrepreneurs and representatives of Adobe, Goldman Sachs and City Creek Center, among others.
While a mostly glowing review of the bonafides that have helped build one of the country’s most successful economies, Quintanilla and a team of CNBC reporters don’t shy away from touching on underlying and ongoing issues for the area like looming environmental concerns and the profound challenges for women and minority-owned business ventures.
Highlights from the feature program include:
The rise of Goldman Sachs
John Waldron, president and chief operating officer for Goldman Sachs, pulled back the veil on the story behind the banking giant’s meteoric rise in the Beehive State, growing from just a few hundred workers at a satellite office in 2009 to over 3,200 current Utah employees, representing some 15% of the company’s U.S. workforce.
Waldron said the importance of its operations in Salt Lake City were highlighted when Hurricane Sandy shut down Goldman’s New York City headquarters in 2012 and the company was forced to lean on Utah staffers to weather the interruption.
Waldron said the emergency accommodations proved to be “a catalyst to make us more confident that we could actually make Salt Lake even more important in the function of the firm,” an outcome that drove further investment in the state. Now, Goldman Sachs counts the city among its most important global hubs and the ascension of its Utah operations has seeded interest in the area among other global players in the financial services sector.
“Our success clearly has given other companies confidence that this is a marketplace they ought to be spending more time in,” Waldron said.
Global competition, on and off the snow
Former Utah Gov. Mike Leavitt oversaw a profound evolution of Utah’s prominence during his nearly three terms as the state’s chief executive, including the successful hosting of the 2002 Winter Olympics.
While the Games themselves, held just months after the 9/11 attacks, were a smashing success and even showed a profit, Leavitt told CNBC that the true impacts of the hosting duties can be found in the lead-up and aftermath of the event.
“Seventeen days of the Games is very important,” Leavitt said. “But it’s what happens in the seven or eight years in advance and what happened in the 10 years after that ultimately make the Games a worthwhile experience both economically and culturally.”
In the 15 years following the Salt Lake Olympics, CNBC reported Utah saw its skier days shoot up 43%, hotel and lodging traffic grew by 70% and visitor spending increased 66%.
But Leavitt had more in the works than just staging a global sports event.
He noted a visit to Adobe co-founder and University of Utah-educated engineer John Warnock sowed the seeds of an education program that would set the stage for the state’s near-horizon future as a center of technology innovation.
During that conversation at Adobe’s Silicon Valley headquarters, Leavitt sought Warnock’s advice on how to build up Utah’s technology community along with an entreaty for Adobe to consider adding a Utah facility.
“You want me to come to Utah?” Leavitt recalled Warnock asking. “If you want me to come to Utah, I need engineers.”
Leavitt took Warnock’s direction to heart, spearheading the 2001 Engineering and Computer Science Initiative aimed at growing programming at state colleges and universities to increase the number of graduates in the disciplines. Like the Olympics, Leavitt’s effort was another success and the program has since more than doubled the number of engineers and computer scientists degree graduates across the state’s higher education system.
If you build it …
While Leavitt’s new engineering initiative was helping drive a bigger stream of Utah college grads ready to enter the high-tech workforce, Warnock also followed up on his end of the conversation.
In 2009, Adobe acquired Utah internet data company Omniture in a $1.8 billion deal, giving the company a foothold in the state that would catalyze the emerging Silicon Slopes tech ecosystem.
Brad Rencher worked at Adobe for a decade before moving on to become CEO of Utah-based human resources platform BambooHR.
“That was a seminal moment in the history of Silicon Slopes,” Rencher told CNBC. “Since then, people have taken the baton and they’ve run with it.”
That includes Rencher’s company that was founded in 2008 and now employs 1,100 in the state and generates some $250 million in annual revenue.
The business of Utah sports
Ryan and Ashley Smith burst into the professional sports scene in 2020 with their $1.6 billion acquisition of the Utah Jazz. Since then, the Smith Entertainment Group principals have found themselves cruising in opportunity’s fast lane, joining in the $400 million acquisition of MLS soccer team Real Salt Lake in 2022 along with a $2 million revival of the NWSL’s Utah Royals and adding a National Hockey League franchise earlier this year in a $1.2 billion deal to take over the Arizona Coyotes.
SEG is also spearheading a sweeping $3 billion Salt Lake City revitalization project focused on downtown’s west side, including renovating the Delta Center, home venue of the Jazz and Utah HC.
The Smiths sat down for an interview with CNBC for the “Cities of Success” segment to talk about the significance of pro sports in Utah’s economy and their plans to lift an entire community along with their hometown teams.
“It’s the largest anchor tenant you could ever have,” Ryan Smith said. “There’s not another anchor tenant like sports … it can make a whole city.”
In March, the Utah Legislature, with Salt Lake City and Salt Lake County support, passed legislation allowing the creation of a downtown sports, entertainment, culture and convention district. Under the law, the city could raise its 7.75% sales tax rate one-half of a percent — pushing it to 8.25%. The council unanimously approved the tax increase in October, which takes effect Jan. 1, 2025.
The tax hike is anticipated to generate $1.2 billion over the 30-year life of the participation agreement, $900 million of which would go to SEG. The company estimates it will spend $525 million to remodel the Delta Center and $375 million on the other district improvements.
Ryan Smith said the opportunity to execute a project of this scope is a rarity but one that will prove to be an “awesome vehicle for helping our state grow.”
“I think we’re in a moment in time, and you don’t get many of these, where you get a chance to look forward at the infrastructure,” Ryan Smith told CNBC. “This is a 30-year-old arena … where is the hotel room flow we need for the Olympics? We’re 1,500 hotel rooms short. Who’s doing this? Someone is going to have to. Is it the state, is it the city?
“In reality it’s all of us … to go and help, and we’re committed.”