Tag Archives: Andrew Cheney

Desert Ridge-1

Desert Ridge Corporate Center reaches 95% occupancy

Two office leases totalling 47,372 SF were leased at Desert Ridge Corporate Center I and II, 20830-20860 N. Tatum Blvd., in Phoenix. These transactions bring occupancy in both buildings to 95 percent.

Lee & Associates principals Craig Coppola, Bill Blake, Colton Trauter, Andrew Cheney and Associate Gregg Kafka, represented the landlord in both of these transactions.

At Desert Ridge I, Regus leased 12,338 SF and was represented by Kevin Calihan of CBRE. At Desert Ridge II, Republic Services leased an entire fl oor totalling 35,034 SF and was represented by Gary Gregg, Mike Gordon and Eric Walker of Cresa.

The four-story, Class A buildings were constructed in 2005 and 2007 and off ers many top amenities and fi nishes for tenants. Phase I won the prestigious BOMA Outstanding Building of the Year Award.

Desert Ridge Corporate Center is conveniently located across from the popular shopping destination Desert Ridge Marketplace at Tatum Blvd. and the Loop 101. The area off ers a myriad of amenities and excellent access to all parts of the Valley.

Papago Arroyo, courtesy of CBRE

Papago Arroyo sells for $40.85M

CBRE announced Tuesday the sale of Papago Arroyo, a three-building office complex in Tempe. The 279,503 square foot, two-story office buildings are located at 1255, 1275, and 1295 W. Washington St. in the geographic heart of metropolitan Phoenix and Tempe office market. The asset commanded a sale price of $40.85 million.

Bob Young, Glenn Smigiel, Steve Brabant and Rick Abraham with CBRE’s Phoenix office, along with Andrew Cheney and Craig Coppola with Lee & Associates, represented the seller, Greenwood & McKenzie of Tustin, Calif., in the transaction. The buyer was undisclosed.

In addition to handing the investment sale, CBRE Vice Chairman Bruce Francis and Vice President Shaun Moothart, both with the CBRE Debt & Structured Finance team, arranged the ten-year loan on behalf of the borrower. The permanent financing included five years of interest-only.

Constructed in 1998 and 96 percent leased, Papago Arroyo is part of Papago Park Center, a 350-acre infill business park with a strong corporate tenant profile, including Wells Fargo, DHL, Union Bank, State Farm, and First Solar. The Tempe submarket has a 10.3 percent vacancy rate, less than half the overall office market vacancy rate in metropolitan Phoenix. This is indicative of the strong tenant preference for a location in Tempe.

“Tempe continues to perform at the top of the metropolitan Phoenix office market. Papago Arroyo offers tenants a centralized, highly desirable location with a strong amenity base and access to one of the strongest labor pools in the Valley,” said CBRE’s Young, lead broker in the investment sale.

“The outstanding central location of the property with its close proximity to Sky Harbor International Airport and the major valley freeways made this a very desirable financing opportunity for a wide variety of lenders and will ensure the property’s ability to draw tenants and stay well-occupied into the future,” says Francis.


Sights Are Set On Speculative Office

Speculative office buildings are making their way back into the market, says Lee & Associates’ Andrew Cheney.

“As of the end of Q1, 18 percent of the 2 MSF we had under construction is speculative,” he says. “Since then, a few notable projects including Hayden Ferry Lakeside III have kicked off 100 percent speculative. Where markets are tight, like Tempe and Chandler, developers are going spec. South Scottsdale is the only other place speculative office is happening. I lease SkySong 3 which is delivering 70 percent pre-leased in July.”

These buildings are attractive to tech companies and financial and professional services, says Cheney. When it comes to speculative office suites, Hines Managing Director Chris Anderson says small businesses are flocking to building in the Camelback Corridor for economic and time-saving purposes.

Generally, small business owners and smaller tenants do not have the time or resources to endure the process of designing space, selecting finishes and absorbing any cost overrun. Hines’ spec suite at 2375 E. Camelback Road is currently attracting several users who need less than 5KSF… Smaller tenants are trying to build or rebuild their businesses and want a fresh new look that matches their business image.”

Hines recently completed a 3,500 SF speculative suite at 24th at Camelback I and leased it prior to completion of construction. With that success, Hines started another 2,900 SF speculative suite on the third floor that Anderson says will be delivered by summer’s end. Tenants are ignoring office suites in buildings that are not central to employment pools, says Cheney, adding that speculative suites are more attractive between the two. Speculative office suites have faster leasing velocity and a reusable design, however, Cheney says, tenants may still require changes from a finished spec suite. It’s a leap of faith for the landlord, Anderson agrees.

What is your best advice for those who are considering speculative office suites?

Chris Anderson Hines

Chris Anderson Hines

“My best advice is to spend money wisely. Pick a few areas to add some ‘wow’ factor, such as upgraded lighting in the conference room or wall coverings that stand out from the crowd. Keep other areas like offices, open work areas and break rooms generic so tenants can add their own furniture and customized touches later.”

Andrew Cheney

Andrew Cheney

“Build them and tenants will come, and make sure they are cool spec suites.”
SkySong III

Online advertising co-op signs lease at SkySong 3

An advertising innovator changing the way companies advertise online will set up shop at SkySong 3 early next year.

The company, adhesive.co, is relocating from east Indian School Road and will begin its five-year lease at SkySong on January 1, 2015. The layout of the space will be in line with the online ad company’s philosophy of a creative and collaborative environment.

The performance display online advertising company—where they like to say “the geeks are in charge”—helps drive incremental business for clients and is regarded as an industry leader with a fresh approach to online advertising. The adhesive team turns pages of code into advertising solutions for advertisers and publishers.

With the leasing agreement, adhesive.co’s presence at SkySong will help enhance its brand and a perfect fit for its collaborative environment.

“The innovative environment at SkySong will become even more dynamic with the addition of adhesive,” said Sharon Harper, President & CEO of Plaza Companies, the developer of the project. “They are online ad innovators and model collaborators who represent the best in entrepreneurial striving. We are thrilled they decided to come to SkySong, where their unique view of the world will be welcomed with open arms.”

Chad Little, one of the adhesive.co founders alongside Patrick Schwind, said: “Serial entrepreneurialism needs the right place to grow and prosper. Fortunately for Patrick and I, and our clients, we have found that place—SkySong. It’s the perfect fit for our approach, for who we are and for what adhesive is all about. We can’t wait to move in and meet our new neighbors and potential collaborators.”

The addition of adhesive.co is the latest addition to the growing SkySong project, which recently saw the completion of the SkySong Apartments and is nearing the completion of SkySong 3, the third office building at the property. With the adhesive.co lease, SkySong 3 is now at 88 percent leasing occupancy even before opening its doors. Leasing is currently ongoing for SkySong 4, the next office building at the project, with construction anticipated to begin by the end of 2014.

Mark Seale of Cassidy Turley was the leasing agent handling the transaction for adhesive.co. The Lee & Associates team of Craig Coppola, Andrew Cheney and Gregg Kafka represented the SkySong ownership group.

SkySong, the ASU Scottsdale Innovation Center is a home to a global business community that links technology, entrepreneurship, innovation, and education to position ASU and Greater Phoenix as global leaders of the knowledge economy.

SkySong is a 42-acre mixed use development designed to:

• Create an ecology of collaboration and innovation among high-profile technology enterprises and related researchers;
• Advance global business objectives of on-site enterprises;
• Raise Arizona’s profile as a global center of innovation through co-location of ASU’s strategic global partners; and
• Create a unique regional economic and social asset.

Companies located at SkySong enjoy a special relationship with Arizona State University, which has more than 73,000 students at four metropolitan Phoenix campuses. Its campus in Tempe is the single largest campus in the U.S., and is located less than three miles from SkySong.

In addition to locating its own innovative research units at the center, ASU provides tenants with direct access to relevant research, educational opportunities and cultural events on its campuses. Through ASU’s on-site operations, tenant companies have a single point of contact for introductions to researchers, faculty and programs to address their specific needs.

Kafka, WEB

Gregg Kafka Promoted at Lee & Associates

Gregg Kafka has been promoted to associate at Lee & Associates Arizona. He was a Runner with The Coppola Cheney Group for 30 months and will now join the team as a broker.

Kafka specializes in the representation of office landlords and tenants in the leasing and sales of offi ce properties in the metropolitan Phoenix real estate market. His extensive knowledge of the Phoenix market is complemented through analysis and marketing skills involving tenant relocation, tenant expansion, lease negotiations, market analysis and property marketing. These qualities, along with a strong work ethic, have earned him respect from the brokerage community.

Kafka, under the guidance of Principals Craig Coppola and Andrew Cheney, has worked with the team to assist with developing new opportunities and all related activities.

“With his construction background, Gregg adds a unique perspective our clients highly value,” said Andrew Cheney, Principal with Lee & Associates. “The rest of the firm values Gregg as a dynamic broker and is excited to have him aboard as an associate.”

He previously worked for Macerich, one of the largest retail REITs in the U.S. where he provided construction and lease analysis for the company. Kafka holds an Arizona Real Estate License and a Bachelor of Science in Construction Management from Arizona State University.