Answer: Michelia champaca 'Alba' doesn't appear on the lists of recommended species for the Phoenix low desert. I haven't noticed it available in local nurseries, which is perhaps why you had to bring it in from elsewhere. My reference shows that it is cold-hardy in zones 10 and 11. Phoenix is in zone 9, and we've had some extra cold snaps this winter, so a species that is not tolerant will likely suffer frost damage (leaves will turn brown and crispy and then drop off). When plants are moved from one growing condition to another (for example, outdoors to indoors), they often suffer "shock" with leaves yellowing and dropping, or other signs of stunted growth. Also, winter is typically a dormant period for many plants, so growth will slow or cease. So, the symptoms your trees are showing are not unusual. When you water, be sure the entire rootball is thoroughly moistened from top to bottom (use a soil probe), then wait to water again until the top inch or two of soil is dry. As daylight lengthens, growth may pick up. When you return the trees outdoors, harden them off gradually to reduce shock. Finally, check to see if the rootball is becoming entangled, growing out of the drainage holes, etc. As spring approaches, it may be time to pot up into fresh soil and the next size container. Good luck!
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