This story appears in the September 2025 issue of Utah Business. Subscribe.
The deal for Hill Air Force Base (AFB)’s Enhanced Use Lease program was signed and ready to go when the 2008 recession hit. In a period when the United States lost 8.7 million jobs and households lost $19 trillion in net worth, a new business development park would likely run into some challenges.
But the administration and workers at Hill AFB had already been waiting decades to get started. A bit more time to firm up the plan was manageable.
The plan was to replace decaying, World War II-era bomb depot buildings by leasing the federal land to private businesses. With few businesses looking to expand at the time, the Enhanced Use Lease program — known in the Air Force as EUL — was paused and fine-tuned instead.
“[The program] kind of just existed for several years as we got everything established and everything got right-side and we started building product,” says Brent Christensen, the chief of the base’s EUL program. By 2016, major defense contractors like Northrop Grumman and Lockheed Martin would be leasing tens of thousands of square feet of office space on the base.
As of this year, the plan has grown considerably — and even become the Department of Defense’s largest commercial real estate EUL program.
Hill AFB has continued to expand, with plans for additional offices, a new gate entrance to the base, and expansion to I-15. The EUL program, arranged as a cooperation between the Air Force, the state of Utah and private sector developers, has become one of Hill AFB’s most notable Utah-focused community projects.
Solving a long-term problem
While the program’s draw is proximity and a deepened relationship with the Air Force for private-sector companies that develop weapons and technological systems with and for the Department of Defense, the EUL program actually started as a way to solve a generations-long problem that plagued Hill AFB. The large bomb depots that were built for WWII operations in the 1940s were facing continuous, hazardous problems like pipes rotting.
“[The buildings] are, of course, 80-plus years old. Over time, [we’ve] converted them mostly to offices,” Christensen says. “And they’re really difficult to maintain. They contain various amounts of contamination, lead, asbestos. They’re aged and they need either updating or demolition, so what we recognized is we needed to try to replace these buildings.”
The military construction process (known as MILCON) run by Congress doesn’t typically prioritize funding these types of projects, he says.
“What they really spend their money on, primarily, is what we call new mission MILCONs, which supports new weapons systems like Sentinel nuclear weapons, the F-35, F-22,” Christensen says. “So those projects tend to get money.”
The goal was to demolish all the hazardous buildings, but without funding, Hill AFB felt they needed to come up with their own solution. According to Christensen, that’s where the leasing program came in.
“The general idea is that the federal government can lease off underutilized land to private industry and the federal government receives some kind of payment in kind for the use of that land,” Christensen says. “Every EUL with the DOD is slightly different.”
The current program, mostly located within Falcon Hill Aerospace Research Park, involves leasing out 550 acres. It is located on the side of the base adjacent to I-15 and currently has all available space — 1.3 million square feet — under lease. On top of offices and research projects, there are restaurants and retailers in the space. Many of the defense contractors are specifically connected to the nuclear weapons enterprise. There are also police and fire departments dedicated to the area.
“The Falcon Hill program creates a business magnet, which will attract new businesses to our community that otherwise wouldn’t have interest. … With the new program, our city becomes a desirable option for those industries, especially for those that don’t necessarily need to be located on base.”
— Brody Bovero
Christensen estimates that about 5,500 employees occupy these spaces.
What’s unique about the project to him is that it’s not just a ground lease; it’s a profit-sharing model. The developer leases square footage to the tenant and makes money off rent, and Hill AFB gets a percentage of that rent.
The developer that handles the project, Sunset Ridge Development Partners (SRDP), is comprised of El Paso-based Hunt Companies and the Utah real estate developer Woodbury Corporation. They partnered with the state and Hill AFB in a tri-party agreement to form SRDP.
Christensen says they primarily focus on offices that could do multi-family, retail, warehousing and potentially some light industrial production that’s environmentally friendly.
Breaking new ground
In April, Cambridge, Mass.-based Draper Labs announced it had begun construction on a new space at Hill AFB. For Paul Hendrickson, Air Force ICBM modernization and Utah site lead, the announcement gave the company a chance to build on the ways it bridges gaps between academia and defense contracting.
Draper Labs was founded at the Massachusetts Institute of Technology in 1932 by engineer and scientist Charles Draper, who was interested in building instruments to track and navigate aircraft. In the 1970s, Draper Labs became a nonprofit so it could develop systems instead of only focusing on research as an academic institution, as doing production work is prohibited for research programs.
As of 2025, Draper Labs has 12 campuses across the U.S., and the Falcon Hill site will open in 2026.
“As we continue to expand, we’re kind of out of room in Cambridge,” Hendrickson says. “Moving to Utah made sense because of our long-term relationship with the Air Force, the amazing technological base that Utah offers, and coming to where the talent is.”
Hendrickson grew up in Layton, Utah, near the base. His father did guidance engineering work for Boeing, a role that Hendrickson eventually would take on himself in a military posting at Hill AFB years later. He retired from the Air Force in 2023 after 21 years, and his aim was to return to Utah.
He joined Draper Labs to build its Clearfield office in 2024, and then the plan to establish a presence on the base came up. For him, the opportunity to see the project through from start to finish adds a deeper opportunity to put Draper Labs’ stamp on the space.
“It allowed us to kind of drive the internals of that building,” Hendrickson says. “We’re building an engineering innovation and development center. We’re gonna do Draper-type things for guidance, navigation and control, precision electronics, potentially all the way through production, but that’s going to be determined as we continue expanding the company. The building will be built out to the latest security standards to support ER, [as] various customers require that. You know, all the latest and greatest engineering tools.”
Hendrickson notes that Draper Labs maintains its educational mission by funding master’s degrees and PhD candidates in areas “critical to national defense.” There are currently over 100 people in these degree programs and about 18 participating universities that have these scholars at them.
There is a philosophy of Charles Draper’s that the company applies now in both educational programs and the contacts at Hill AFB: “You can build facilities and hire people to come to them,” Hendrickson summarizes, “but if you go to where the talent is and give them the hard challenges to solve, then good things happen.”
For him, this idea has a lot to do with how the Falcon Hill project can connect Utah’s various educational, business, technology and military sectors all at once.
“One of the nice things about the state of Utah is it’s one of the fastest growing aerospace and defense communities in the U.S.,” he says. “They’re very supportive of that. The pipeline from the universities is phenomenal — they work very closely with the industry to make sure they’re vectoring their graduates to make sure they support these types of missions. So we see a lot of room for growth not only with the core universities but also with the tech colleges.”
How it all comes together
For Christensen, the EUL program’s efficiency makes it work best for companies. He credits this especially to the state of Utah’s creation of a department specifically to oversee federal and state land leasing, the Military Installation Development Authority (MIDA).
“The state of Utah recognized that, suddenly, 500 acres of federal land was going to have commercial real estate on it and be generating property tax for the first time ever,” Christensen says. “And there would likely be something similar to an Oklahoma land rush as cities attempted to annex parts of the base to claim that tax revenue. The state didn’t want that.”
He says they foresaw different cities trying to determine which parts of the boundaries were theirs.
But tax revenues are only one consideration among many for Hill AFB’s neighboring communities. Brody Bovero, the city manager of nearby Syracuse, says there are multiple perspectives on how the base impacts the local economy and how it can factor into their decision-making.
“The first is a supply and demand versus capacity perspective, and the second is a business multiplier perspective,” Bovero explains. “In the former, some may see that the demand created by the Falcon Hill program will be largely absorbed by the supply provided by the federal land on the base instead of private, developable land within the surrounding communities.”
He says this could be seen as a negative by cities, but he thinks “those surrounding communities wholeheartedly support Hill AFB and its strategic mission.”
Syracuse has another city between its boundaries and Hill AFB — Clearfield — but it is still close to the base’s south and west gates.
“I believe most of our city views it from a business multiplier perspective,” Bovero says. “The Falcon Hill program creates a business magnet, which will attract new businesses to our community that otherwise wouldn’t have interest. … With the new program, our city becomes a desirable option for those industries, especially for those that don’t necessarily need to be located on base.”
The cities have even taken things a step further and built infrastructure specifically around the needs of private companies leasing these sites.
“In Syracuse, we have adjusted our general plan to accommodate the industries associated with the Falcon Hill program,” Bovero says. One major road has been developed with major utility upgrades to handle the type of traffic needed for the projects.
For Christensen, these planning considerations factor into their leasing process, too, ensuring ideal setups for tenants. A benefit of Falcon Hill, he says, is that tenants don’t have to go to local municipalities to get approvals for their projects; they get those directly from the Air Force and DOD, which they see as a more streamlined process.
“The city doesn’t levy burdens on the developer for new streetlights,” he says, “so that’s attractive to certain tenants.”
MIDA maintains and builds roads, hires police and fire departments, and oversees the administrative aspects of the land.
Companies have a 50-year ground lease, meaning the development company builds the building and then leases it. In 50 years, the ground lease finishes, and Hill AFB can take ownership of the parcel and whatever facility is there. The lessees could also renew the lease after those 50 years. There is also a clause in the lease that requires them to build an escrow account where the company leasing would demolish and give everything back to Hill AFB at the end of the lease.
Every time a company that participates in the program builds, they get a 50-year lease on that parcel, Christensen explains. With the addition of new areas to lease under the I-15 expansion, even more lessees will enter the program in the coming years.
“It’s going to take a long time for this to work through the process,” he says. “We’re going to have to clean up the books — maybe in 10-15 years, we’re going to have to reconcile everything to make sure it’s all on a similar timeline.”