Southeast Employment & Logistics Center (SELC) Location
TUCSON, ARIZ. (June 17, 2025) – California-based defense startup Castelion Corporation, a rapidly emerging player in hypersonic missile manufacturing, is being actively courted to expand into Tucson as part of a high-profile economic development initiative near the Pima County Fairgrounds. The company is a prospective tenant for the Southeast Employment & Logistics Center (SELC), a proposed 2,000-acre, master-planned industrial hub. The Pima County Board of Supervisors is scheduled to vote on the project’s approval at its Tuesday, June 17, 2025, meeting.
Founded in 2022 by three former SpaceX executives, Castelion specializes in the rapid development and scalable production of hypersonic weapons systems. The company has secured over $100 million in venture capital and government contracts, including more than $22 million from the U.S. Air Force. It plans to conduct flight demonstrations of its first product later this year.
A June 3 report in the Phoenix Business Journal confirmed that Arizona officials, including U.S. Sen. Mark Kelly, the Arizona Commerce Authority, and the City of Tucson, are actively urging Castelion to consider Southern Arizona for its next phase of growth.
Industrial Development Advances in Southeast Tucson
The company’s potential expansion may align with a broader effort known as “Project Blue”, a confidential economic development project being discussed for the 290-acre county-owned site southeast of Tucson. The site adjacent to the Pima County Fairgrounds is being positioned as a regional hub for high-tech industrial users.
In a recent memo to the Pima County Board of Supervisors, County Administrator Jan Lesher noted that Project Blue is expected to create 180 direct jobs with average annual salaries of $64,000, contributing an estimated $63.5 million in economic impact and $7.3 million in annual labor income. Preliminary site plans indicate multiple buildings, each totaling 220,000 square feet.
Supervisor Steve Christy has described the development as including a data center. At the same time, other sources suggest a second component—believed to be Castelion—may also bring advanced missile system manufacturing to the site.
Federal and Local Support for Aerospace Growth
In March, Sen. Mark Kelly sent a formal letter to Castelion executives Byron Hargis (CEO) and Bobby Panerio (Head of Manufacturing), touting Arizona as a national leader in aerospace and defense and encouraging the company to consider Tucson during its site selection process.
“Arizona is home to over 1,200 aerospace and defense companies and six major military installations,” wrote Kelly. “The proposed site for Castelion’s expansion in Tucson is home to the University of Arizona, which has deep expertise in hypersonic research. As you continue your site selection process, I ask that you give full and fair consideration to the many opportunities offered by Arizona.”
Kelly also cited Arizona’s track record in attracting advanced manufacturing, including investments from TSMC, Intel, Amkor, and LG Energy Solutions.
NDAs Signal High-Stakes Negotiations
While Castelion has not issued a public statement, the City of Tucson, Pima County, and the University of Arizona have all confirmed nondisclosure agreements with an aerospace company believed to be Castelion. Deputy County Administrator Carmine DeBonis confirmed the county's engagement and described the project as a "significant employment generator."
Despite the confidentiality, the project aligns with Castelion’s search for a domestic manufacturing and testing site, and with Southern Arizona’s established strengths in the aerospace and defense sectors, anchored by companies such as Raytheon Missiles & Defense, Northrop Grumman, Boeing, and Honeywell Aerospace.
Community Reactions Mixed
As Project Blue moves toward approval, reactions from the Tucson community have been mixed. While business and economic development leaders are optimistic about the project’s potential to generate high-wage jobs and attract advanced industry to the region, local environmental and anti-war advocates have raised concerns.
Critics point to Tucson’s legacy of groundwater contamination from past missile manufacturing operations and question the ethical implications of expanding weapons development in the area. Many are calling for greater emphasis on clean energy and sustainable industries, arguing that Tucson’s long-term prosperity should align with environmental stewardship rather than defense manufacturing.
In response, backers for a data center emphasize that the development will be a model for sustainable and responsible water use, incorporating robust water stewardship initiatives centered around three core tenets:
-
Water Replenishment Projects: Project Blue has committed to replenishing all consumptive water losses generated by its operations. In partnership with Tucson Water, the company will invest directly in local water projects that deliver measurable, net-positive impacts on water availability, quality, and accessibility. The volume of water replenishment is expected to meet or exceed the project’s total consumptive use.
-
On-Site Efficiency: The facility will utilize cutting-edge cooling systems designed for minimal water usage. These systems are capable of operating solely with outside air during winter and shoulder months, significantly reducing the project's year-round water footprint while maintaining industry-leading operational efficiency.
-
Reclaimed Water Use & Infrastructure Expansion: Project Blue is not only committed to using reclaimed water but will also fund a major infrastructure expansion. This includes an 18-mile extension of Tucson Water’s purple pipe reclaimed system, which will be oversized to support future growth and help convert existing potable water customers to non-potable sources. Additionally, the project will contribute to the construction of a 30-acre aquifer recharge facility, enhancing regional water reliability and providing community recreation opportunities similar to those of the successful SHARP facility.
As the Pima County Board of Supervisors prepares to vote on Project Blue, the initiative remains a focal point for broader discussions about Tucson’s economic future, environmental values, and water sustainability.
What’s Next
The Pima County Board of Supervisors is expected to vote on the proposed land use plans for the new industrial site. Should the deal advance, Castelion’s arrival would represent one of the most significant aerospace investments in Southern Arizona in recent years.
If finalized, the project would further cement Tucson’s reputation as a national hub for cutting-edge aerospace, defense, and advanced manufacturing innovation.