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Alberta Plans 187 M-F Units, Retail in Downtown Tempe

4 Mar 2014, 4:10 pm

By Amalia Otet, Associate Editor

Greenwood Village, Colo.- based Alberta Development Partners has acquired a 1.9-acre parcel at the northwest corner of University Drive and Ash Avenue in the Mill Avenue District of downtown Tempe, where it plans to develop 187 apartment units and 40,000 square feet of ground-floor retail space.

PCCP L.L.C., a real estate finance and investment management firm provided a $5.7 million senior loan to Alberta to purchase and entitle the development site.

The seller, Brookfield Asset Management of Toronto, was represented by Barry Gabel and Chris Marchildon of CBRE Group Inc.’s Phoenix office, in conjunction with CBRE’s National Loan Sale Advisory Group. Alberta Development Partners negotiated the sale in house.

The property is “one of the single most sought-after vacant land parcels in the Phoenix metropolitan area,” according to Gabel.

With a shortage of grocery retailers in downtown Tempe, Alberta is seeking a grocery tenant to anchor the development. At present, the nearest grocer is a Safeway two miles away.

The community will be within walking distance of the Mill Avenue District and its 75 restaurants, shops and nightlife attractions, and close to the 60,000 students, faculty and staff at the nearby Arizona State University campus.

“Both Alberta and PCCP look forward to further contributing to the vibrant Mill Avenue District and delivering the proposed mixed-use project to the market,” said Philip Russick, principal with PCCP, in a statement. “There is a pent-up demand in the area for the product they are seeking to entitle and we feel this will be an ideal fit for the area.”

Despite an increase in multifamily completions last year, Phoenix’s steady employment growth and robust economy will allow housing supply and demand to remain well aligned. Approximately 4.500 units are projected to come online in 2014, an uptick from the 3.900 units completed last year. According to a forecast by Marcus & Millichap Real Estate Investment Services Inc., vacancy will fall 30 basis points to 6.9 percent this year. In 2013, vacancy dropped 40 basis points.

The Tempe/Arizona State University area remains even tighter, with vacancy declining to the low 4 percent range.

Chart via Marcus & Millichap’s 2014 Annual Report

Epoch To Make Phoenix Debut With $50M M-F Project; Jerry Simms Pays $45M for Scottsdale Retail Center

21 Feb 2014, 7:26 pm

By Amalia Otet, Associate Editor

Winter Park, Fla.-based Epoch Properties Inc. is starting work on a $50 million multi-family project that would bring up to 292 new apartments to downtown Phoenix. Epoch plans a second-quarter groundbreaking for the project, which marks the Winter Park, Fla.-based company’s debut in metropolitan Phoenix. Completion is scheduled for early 2015.

Dubbed 11 Capital Place and 12 Capital Place, the property would comprise two four-story structures, each on top of one level of podium parking. A  parcel located along the south side of Washington Street at 12th Street is targeted for 152 units and another 140 units are planned for the north side of Washington Street at 11th Street, Business Real Estate Weekly of Arizona reportedThe communities will be adjacent to the 12th Street light rail stop.

Epoch bought the two parcels for $8.1 million in a deal structured by Mark Forrester and Ric Holway of Hendricks Berkadia.

The property is designed to attract young professionals with ties to the legal industry, Arizona State University’s downtown campus and Phoenix Sky Harbor International Airport. Archicon, the project’s architect, is designing studio, one-, two- and three-bedroom units ranging from 890 square feet to 1,500 square feet. Monthly rental rates are expected to run from $1,200 to $2,400. Epoch will also manage the properties.

In retail transaction news, an entity controlled by Jerry Simms, owner of the Turf Paradise racetrack in Phoenix, paid $44.5 million for Shea Scottsdale, a 160,228-square-foot retail center in the Scottsdale/Paradise Valley submarket.

Executive Managing Directors Michael Hackett and Ryan Schubert of Cassidy Turley’s capital markets group represented the seller, Los Angeles-based Karlin Real Estate. Marty De Rito of De Rito Partners in Phoenix represented the buyer.

Completed in 1994, the property is located at 10653 N. Scottsdale Road. Anchored by Safeway and CVS Pharmacy, the center was 95% leased at the time of closing. The transaction included all in-line space as well as additional sites with freestanding structures, including Wells Fargo, McDonalds, MidFirst Bank, Jason’s Deli and Arby’s.

Karlin Real Estate had purchased the asset in October 2011 along with an adjacent 117,025-square-foot retail center, Shea Scottsdale East at 7366 E. Shea Boulevard, for approximately $50 million. At that time, the two centers had a combined overall occupancy of 85%, according to Cassidy Turley. Karlin Real Estate has retained ownership of Shea Scottsdale East.

Shea Scottsdale Shopping Center via Karlin Real Estate website

KBP Realty Pays $8M for Deer Valley Flex Complex; Mark-Taylor Plans Upscale M-F Project in Scottsdale

10 Feb 2014, 11:04 pm

by Amalia Otet, Associate Editor

In an $8 million deal, KBP Realty Advisors has acquired Turner Spectrum Ridge, a 68,195-square-foot industrial flex property in Phoenix, from Newport Beach, Calif.-based Turner Real Estate Investments. The price translates to about $117.98 per square foot.

Turner Spectrum Ridge is a four-building, multi-tenant development located at 21025 North 8th Way and 21045-21111 North 9th Place, in the Deer Valley submarket, just north of the 7th Street exit on the Loop 101 Pima Freeway.

Developed in 2009, the property was 93.5 percent occupied at the time of closing.

Senior Managing Directors Bob Buckley, Tracy Cartledge and Steve Lindley of Cassidy Turley’s capital markets group arranged the transaction.

“Spectrum Ridge’s location dynamics and configuration resulted in strong tenancy,” Buckley commented in a statement. “Combined with current positive leasing momentum, this set the stage for a competitive pursuit by numerous Investors looking for quality product with upside potential.”

In multi-family news, Business Real Estate Weekly of Arizona reports that Scottsdale-based Mark-Taylor Inc. has acquired a 16.7-acre tract in North Scottsdale, where it plans to build a 252-unit luxury multi-family community. The seller was LaSalle115 Holdings L.L.C.-Series 34 Villa Volterra, an entity affiliated with BMO Harris Bank in Chicago, as successor to M&I Bank.

Located at 7215 E. Silverstone Drive, the acreage is part of the 160-acre former location of the Rawhide Western Town theme park.  Now rebranded as Silverstone, the old Rawhide site is being redeveloped with retail, multi-family and single family residential, senior housing and a planned office park.

A 12-acre upscale strip mall anchored by Sprouts is under construction at the southeast corner of Pinnacle Peak and Scottsdale roads, with delivery scheduled for late 2014/early 2015. Vi at Silverstone, a continuing care retirement community, opened at the site in 2010.

Mark-Taylor’s planned rental complex is designed by Architectural Design Group and will feature one-, two- and three-bedroom units averaging about 1,100 square feet. Monthly rents are expected to average around $1,430.

Groundbreaking is scheduled for mid-2015, followed by opening about 10 months later. Mark-Taylor Development will serve as contractor. Development will cost an estimated $45 million, according to BREW.

Photo credit: 21045-21111 North 9th Place in Phoenix via Google Maps

CSM to Reinvent Phoenix Office Building as Select-Service Hotel; W.P. Carey Pays $23M for Avnet HQ In Tempe

31 Jan 2014, 10:59 pm

By Amalia Otet, Associate Editor

CSM Lodging plans to revamp the historic Professional Building–the former Valley Bank & Trust building–in downtown Phoenix, and turn it into a premium select-service hotel.

The hospitality company, a division of CSM Corp., completed the purchase on Dec. 20. “We look forward to working with Phoenix, which has been so supportive, to open the hotel in time for the city’s hosting of the 2015 Super Bowl,” said Bill Upshaw, president of CSM Lodging, in a statement.

Located at North Central Avenue and Monroe Street, the landmark property will undergo a $40 million makeover. Highlights include renovation of the Art Deco exterior, installation of new insulated windows; new mechanical, electrical and plumbing systems; and a complete refurbishment of the former bank lobby, which will serve as the main reception and gathering place for hotel guests.

The hotel will feature 165 guest rooms on 12 floors, a rooftop terrace, 5,000 square feet of meeting space, a business center, a 1,300-square-foot fitness center, and on-site parking. Additionally, the compound will host approximately 8,000 square feet of retail along Central Avenue.

As to the branding options, CSM Lodging tends to gravitate toward either Marriott or Hilton; but the dearth of Hilton product in downtown Phoenix should tip the scales in favor of the Hilton Garden Inn brand.

Upon opening, Hotel Monroe is expected to bring 105 jobs to downtown Phoenix marketplace, on top of 100-plus jobs created during construction and an overall economic impact of about $18 million.

In other news, W.P. Carey Inc. announced that CPA®:17-Global, one of its publicly-held, non-traded REIT affiliates, has acquired 8700 South Price Road (below left), a Class A office building in Tempe, for approximately $23 million.

Built in 2000, the 132,070-square-foot facility serves as the global headquarters of Avnet Technology Solutions, one of Avnet Inc.’s two operating groups. It is located on a nine-acre tract within the Arizona State University Research Park and has direct frontage on the Loop 101 freeway.

Commenting on the acquisition, Morgan Olsen, President of the Arizona State University Research Park board of directors and Arizona State University’s CFO, said in a statement: “We are delighted that W. P. Carey has purchased a property in the ASU Research Park. This acquisition validates the institutional quality of the facilities and tenants within the Research Park, currently home to 48 companies which provide over 4,500 high-quality jobs.”

Chris Toci, Chad Littell and Michael White of Cushman & Wakefield Inc. represented the seller, Atlanta-based Piedmont Office Realty Trust, in the transaction, according to AZRE Magazine.

Avnet, a major global distributor of electronic components, computer products and embedded technology, will continue to occupy the building under a long-term net lease. As part of its commitment to sustainability, the company is seeking to install solar panels  to improve energy efficiency .

Photo credits: Professional Building courtesy of CSM Lodging; 8700 South Price Road courtesy of W.P. Carey Inc. via PRNewswire

Younan Buys Class A Office Building for $7M; Hansji Urban to Start $80M Marriott Project

28 Jan 2014, 11:06 pm

By Amalia Otet, Associate Editor

In a $7.1 million deal, Woodland Hills, Calif.-based Younan Properties Inc. has acquired Black Canyon Corporate Center, a 94,203-square-foot office property in Phoenix. The price translates to about $75 per square foot. Black Canyon Center was 82 percent leased at the time of sale.

Built in 2002, the asset is a Class A, multi-tenant office building with a two-story lobby. It is located at 10835 North 25th Avenue, within 15 minutes of Sky Harbor International Airport and a half mile of the National YWCA Leadership and Conferencing Facility, Nearby shopping and dining destinations include the Metrocenter Mall.

Eric Wichterman,  Mike Coover,  Jeff Wentworth, and Sean Spellman of Cassidy Turley arranged the transaction on behalf of the buyer and seller. LNR Partners, the property’s seller, was represented by asset manager and special servicer John Mitchell.

“Black Canyon Corporate Center is arguably the highest quality office building in the Northwest Phoenix trade area,” Wichterman commented in a statement. “With a strong tenant base it offered a unique mix of stability with upside potential for Younan Properties.”

In hospitality development news, the Phoenix Business Journal reports that Irvine, Calif.-based Hansji Urban plans to start work on an $80 million project within the historic Luhrs block in downtown Phoenix.

Dubbed the Luhrs City Center Marriott, the 19-story structure will replace a two-story office building on the northwest corner of Madison Street and Central Avenue. The site is located within Luhrs City Center, a Hansji-owned city block consisting of mixed-use, office, retail, parking and development sites. Hansji acquired the property in October 2007 with plans to return the area to its former vibrancy.

The 320-key hotel will host two brands: Courtyard by Marriott, which will take over the lower 120 rooms, and a 200-key Residence Inn by Marriott.

Groundbreaking is scheduled for this spring, followed by 22 months of construction.

Photo credit: Luhrs City Center via Hansji Urban Facebook Page

TDI Starts 332-Unit Luxury M-F Project at One Scottsdale

20 Jan 2014, 5:19 pm

By Amalia Otet, Associate Editor

Irving, Texas–based TDI Real Estate Holdings L.L.C. has broken ground on Jefferson on Legacy, a 322-unit luxury apartment community. The project is part of One Scottsdale, a 115-acre mixed-use development in North Scottsdale.

Jefferson on Legacy is the second phase of a planned 750-unit residential development and is scheduled for completion in 2015.

“Jefferson on Legacy will be the premier luxury multi-family project in north Scottsdale to meet a growing demand for upscale housing in this submarket, which is a major employment center for the region,” said TDI executive vice president & investment partner Gus Villalba.

The multi-family community will offer 150 one bedroom/one bath apartments, 151 two bedroom/two bath apartments and 21 three bedroom/three bath apartment homes. Amenities include a controlled access gate, free Wi-Fi in all common areas, as well as a 10,400-square-foot clubhouse that features a lounge, media room, gourmet kitchen and fitness center.

Jones Lang LaSalle Inc. arranged a construction loan from Fifth Third Bank and equity financing from an institutional equity provider.

TDI currently has 2,608 units under construction in Texas, New York and Arizona and provides asset management for more than 5,294 units nationwide. The company plans to develop another 1,200 units over the next 12 months.

A joint venture of DMB Associates Inc. and Macerich, One Scottsdale could eventually comprise 1.8 million square feet of office and retail space, 1,100 upscale residential units and a 400-key boutique hotel at Scottsdale Road and the Loop 101 Freeway, according to the development’s website. Henkel AG’s North American headquarters anchors the office component.

One Scottsdale Rendering via DMB Inc.

P. B. Bell Closes on Sites of Luxury M-F Projects in Phoenix, Scottsdale

24 Dec 2013, 4:42 pm

By Amalia Otet, Associate Editor

P. B. Bell Cos. has closed on the site of a planned 244-unit luxury multi-family community about five miles from downtown Phoenix, the Scottsdale-based company said Dec. 19. Located at the intersection of 16th Street and Highland, the project is scheduled to open during the second quarter of 2015.

Dubbed Scape Modern Living, the complex will offer one- and two-bedroom units in three- and four-story building configurations. Units will feature nine-foot ceilings, complete appliance packages, granite countertops, balconies and walk-in closets. Common amenities include gated access, underground parking, attached garages, a heated pool and spa, residents’ lounge and exercise facility, theater room, fireplace and flat-screen TV. The community will be situated near Camelback Corridor and the Biltmore area.

P.B. Bell also said that it has closed on a 4.5-acre site in Scottsdale where it plans to build Cascàd, a 187-unit high-end apartment community. Located at Scottsdale Road and Mayo Boulevard, the project will feature a pool with spa, exercise facility and residents’ lounge, among other amenities. Cascàd is part of a planned mixed-use project that may also include retail, hospitality and office components.

The Greater Phoenix multi-family market has shown strong growth lately, with vacancy rates dropping and rents growing for the fourth consecutive year. According to Marcus & Millichap Real Estate Investment Services Inc., average monthly rents will end the year at $775, a 2.9 percent increase compared with 2012. Last year average rents increased 2 percent.

Nearly 2,900 new units have come on the market during the past 12 months, more than 1,900 of them during the second and third quarters. Some 7,600 units are under construction.

The largest of those projects are the Liv Ahwatukee in South Phoenix and Liv Northgate in Gilbert, high-end projects being developed by Grand Haven, Mich.-based Investment Property Associates. Scheduled for completion this coming spring, each community will comprise 402 units.

Photo credits: Rendering of Liv Northgate luxury apartments via official website

Whitestone REIT Buys N. Scottsdale Community Center for $37M

14 Dec 2013, 12:59 am

By Amalia Otet, Associate Editor

In a $37.4 million off-market deal, Whitestone REIT has acquired Market Street at DC Ranch, a 241,280-square-foot mixed-use neighborhood center in North Scottsdale, from DMB. The purchase price equates to $156 per square foot.

The property was 80 percent occupied at the time of closing and includes an adjacent land parcel that permits the addition of 35,000 square feet of leasable space.

Developed in phases between 1999 and 2003, Market Street primarily serves DC Ranch, one of Scottsdale’s signature master planned communities. It is located on the southeast corner of Thompson Peak Parkway and Pima Road and features a ‘main street’ theme incorporating 15 architecturally distinctive buildings that include 86,991 square feet of office space and 154,289 square feet of retail.

“While Market Street was not on the market for sale, we began discussing a possible purchase directly with DMB in early summer,” said Whitestone Chairman & CEO James Mastandrea in a statement.

The community center is anchored by a Safeway grocery store and showcases a diverse tenant base including Wells Fargo Bank, Fleming’s Steak House, Grimaldi’s Pizza, MidFirst Bank, McCormick & Co., and Edward Jones.

Market Street is Whitestone’s 21st acquisition in the Phoenix metropolitan area, and expands its local footprint to over 1.8 million square feet. Since its equity raise in October, the Houston based-REIT has invested $60.7 million in three properties, including Fountain Hills ($20.5 million), Corporate Park Woodland II ($2.8 million) and Market Street ($37.4 million).

Meanwhile, 7200 West Buckeye Road Industrial Investors L.L.C. purchased 7200 West Buckeye Road, a 400,000-square-foot industrial property in Southwest Phoenix for $26.3 million. Jones Lang LaSalle Inc. Managing Directors Mark Detmer and Bo Mills represented both the buyer and the seller.

Located on Buckeye Road within minutes of Interstate 10, the property is 100 percent leased through 2017 to Home Depot U.S.A. Inc. The building was built in 2009 and features amenities such as 32-foot clear heights, cross-dock loading, concrete truck courts and trailer storage.

Photo credit: Whitestone REIT via Business Wire

Liberty Property Trust Breaks Ground on 1 MSF Tempe Business Park

9 Dec 2013, 5:25 pm

By Amalia Otet, Associate Editor

Liberty Property Trust has broken ground on the first building at Liberty Center at Rio Salado, a 1 million-square-foot business park in Tempe and the REIT’s largest project to date in Arizona.

Scheduled for completion in mid-2014, the speculative two-story project at 1850 W. Rio Salado Parkway will feature 155,000 square feet of Class A office space. Additionally, the building is designed to achieve LEED Silver certification. Site preparation is currently under way for a sister building nearby.

In all, the first phase will include six office buildings and one industrial buildings, Liberty said in a statement. For the second phase, which will be located across the street, Liberty is eyeing plans for a hotel, retail space and additional office buildings.

“Our strategy is to create work environments that can make a difference in the quality of people’s lives,” said William Hankowsky, CEO of the Malvern, Pa.-based REIT, in a statement. “We believe that Liberty Center at Rio Salado—with its sustainable buildings and commitment to amenities such as an outdoor amphitheater and Wi-Fi—will provide a terrific location for creativity, productivity and innovation.”

At full build-out, the Liberty Center development will comprise as many as 11 buildings. It will also offer convenient access to Sky Harbor International Airport and to major Phoenix-area freeways. All buildings in the park will be designed to LEED standards and will emphasize energy efficiency and green practices.

As previously reported by Commercial Property Executive, Tempe tapped Liberty in 2012 as master developer of the 100-acre site at the northwest corner of Priest Road and Rio Salado Parkway.

Rendering of Liberty Center at Rio Salado via website

Freeport-McMoRan Center Receives TOBY Award; MIG Picks Up Class A Office Building

30 Nov 2013, 12:08 am

By Amalia Otet, Associate Editor

Freeport-McMoRan Center, a 26-story mixed-use building in downtown Phoenix managed by Transwestern, has received The Outstanding Building of the Year (TOBY) Award for 2013 from the Building Owners and Managers Association International’s Greater Phoenix chapter. The award recognizes Transwestern’s property management and operations skills in the corporate facility category.

The TOBY awards honor outstanding commercial office projects and recognize excellence in building management. During the competition, the building goes through a series of assessment procedures that evaluate everything from community involvement and site management to environmental and “green” policies and procedures, tenant relations programs, amenities package, building standards, energy management, accessibility and overall service.

Owned by National Electrical Benefit Fund, the three-year-old property serves as the corporate headquarters of Freeport-McMoRan Copper & Gold Inc., the world’s largest publicly traded copper mining company. It is also home to The Westin Phoenix Downtown hotel and Province restaurant. In 2010, the building was named one of the best tall buildings in the Americas by the Council on Tall Buildings and Urban Habitat.

In office investment news, Newport Beach, Calif.-based MIG Real Estate has acquired Arcadia Gateway Center, an 89,835-square-foot, Class A office building in Phoenix, for an undisclosed price.

Located at 4222 East Thomas Road, the four-story property offers a variety of suite sizes with views of Camelback Mountain and the Phoenix Mountain Preserve. Additionally, the property features a three-story, detached parking structure. It was 93 percent leased at the time of the sale.

“Arcadia Gateway Center is one of the higher quality office properties along the 44th Street Corridor,” said Greg Merage, CEO of MIG Real Estate, in a statement. “We plan to continue investing in Phoenix, as it is in the early stages of recovery and is expected to outperform the U.S. in terms of office employment growth and corporate investment, as highlighted by the recent announcement from State Farm to increase its workforce by 6,000 employees.”

Arcadia Gateway Center offers convenient access to Phoenix Sky Harbor International Airport as well as to upscale shopping destinations including Downtown Scottsdale and Biltmore Fashion Park. Retail centers such as Arcadia Crossing and Desert Palm are within walking distance.

Photo credits: Transwestern via PRNewswire

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