Tag Archives: Grubb and Ellis

Commercial Development - AZRE Magazine January/February 2012

New Commercial Development Will Impact Growth In The Next 100 Years

Arizona’s economic strength and growth the next 100 years depend on the creation of new buildings, commercial development and new infrastructure

A high-speed train between Phoenix and Tucson. Toll roads on I-10 and I-17. A new shopping mall. Three outlet centers. A major development in West Phoenix. New casinos.

Solar manufacturing plants. A light rail that extends from Phoenix to Gilbert. A new interstate — I-11 — linking Phoenix and Las Vegas. State-of-the-art sports facilities.

Reality or wish list?

As Arizona looks ahead to its next 100 years, the future of the commercial real estate industry hinges on new infrastructure to keep the state’s economic engine churning while meeting the demands of a growing population.

Since the recession unloaded on the commercial real estate industry in the mid 2000s, it’s been an uphill climb for those in the industry, including general contractors, architects, engineers, subcontractors, developers and brokers.
Commercial Development - AZRE Magazine January/February 2012
“We will see a population shift to urban areas with a focus on transit- oriented development,” predicts Bryan Dunn, senior vice president at Adolfson & Peterson Construction. “Commercial property will need to be re-purposed into alternate uses due to the glut of vacant space in the real estate market.

“We will need to find creative ways to own and operate buildings in the future. There is a growing demand for public/private partnerships for municipal and educational facilities, similar to what has been done in Europe,” Dunn says.

AZRE Magazine asks some experts in commercial real estate how they see the industry changing in Arizona over the next decade and beyond. Here are their responses:

Planning and Development

“In the next 10 years, Arizona will finally adopt Tax Increment Financing (TIF) to remain competitive in the business world. The new normal is for less reliance on homebuilding as a jobs industry. Two more high rise office buildings with mixed uses on the lower floors will be built in Downtown Phoenix. In the next 100 years, high-speed rail
will run between Phoenix and Tucson in the Sun Corridor and a new, man-made lake/reservoir will be created north of Phoenix to collect upstream snow melt and serve the needs of Metro Phoenix.”
— Jon Froke, Planning Director, City of Glendale

“During the next 10 years, smaller developments that require less off-site infrastructure and result in lighter commitments from homebuilders are likely. Infrastructure requirements/costs will be lower and financial commitments will be smaller, both of which are desirable to financiers and homebuilder shareholders recovering from the recent downturn.

“In the next 100 years, development and homebuilding will undergo some of the most rapid changes ever. In Metro Phoenix and the Tucson area, densities will undoubtedly increase dramatically; we will grow upward rather than outward, as large metropolitan areas eventually do. The materials builders use will change dramatically, looking and feeling different. There will be stronger and lighter materials. Although hard to imagine, many unique, innovative homebuilding products that will be used the homes of the future have already been developed, we continue to wait for them to be rolled out to consumers.

“The continued development of solar technologies is going to have huge impact on all types of commercial development in Arizona.  Imagine buildings – retail, office, industrial, homes – not needing to be hooked up to the grid because they produce all of the energy necessary for their usage. The development of “net-zero” facilities in this market, where sun is plentiful, will have a dramatic positive effect on Arizonan’s lives.”
— Jim Belfiore, President, Belfiore Real Estate Consulting

Brokerage

“The beginning of the change is going on right now. The exchange of ownership has and will have an impact on our industry in the next 10 years. In the RTC days it took about 15 years to fully recover, this current cycle will take 5-7 years to process all of the inventory and for the next wave of owners to re-trade the properties. Banks, special servicers and the FDIC will be in charge of real estate for the long term and all of the assets that are currently under their control won’t make it back into private hands in total for 10 years.

“The medical use of retail space will be in full force, everything about this makes sense, retail buildings, namely big box spaces, have the power, the lower rents and the parking already in place to handle a medical user. This will create truly mixed-use locations.
“Internet sales fulfillment centers will hit a critical mass, even if and/or when the state begins to charge them sales tax, even at a much lower rate. Phoenix is well located, we have a growing economy and it makes a lot of sense that those are now starting to pop up here.

“In the next 100 years, buildings will be far more energy efficient, materials to build buildings will be so much more advanced than we can even imagine. In commercial buildings, there will be more bodies per square foot, more technology, less employees, smaller office size requirements. Thousands of new businesses will be created.”
— Pete Bolton, Managing Director/Executive VP, Grubb & Ellis

“Real estate growth over the next decade will be far more restrained than in the boom period in the 10 years before the onset of the recession. During that time, commercial property inventories routinely expanded by anywhere from 3% to 5% annually, driven by growing tenant demand for space and rents that steadily pushed higher. A return to that environment is unlikely anytime soon.

“Forecasting out over the next 100 years presents a pretty daunting challenge … but all of the demographic trends show Arizona will remain a growth market over the next century and population growth will spur demand for both commercial and residential real estate. Beyond demographics and quality of life factors, we believe global economic patterns will support growth in Arizona.”
— Bob Mulhern, Managing Director, Colliers International

Architecture

“The design and construction industry needs to be at the forefront of determining how Arizona is developed over the next 10 years. We need to take a hard look at the lessons learned from the past 10 years regarding unconstrained growth and sprawl, as well as from the positive developments of renewed urban focus, comprehensive transportation and development plans, and increased integrated project delivery partnerships.

“Architects have the responsibility for shaping the built environment that we all experience on a daily basis and need to ensure that built environment is increasingly sustainable, functionally practical, and aesthetically pleasing. Through technological advances and communication outlets, AIA architects will be continually educating ourselves about, and be more globally aware of industry trends and improvements that can be applied locally, so that Arizona becomes the ideal place to live, work, and play. In addition to increasingly becoming the leading stewards of our built environment through sustainable design and comprehensive planning, You are going to see an increasing significance in the role the design industry plays in the overall development of our communities.

“The industry will partner much more with government and lines will be blurred in community planning, design review, and construction inspection. Public-Private Partnerships and Integrated Project Delivery methods will become the norm, and the design and construction industry will have much more at stake in what they develop beyond their immediate financial compensation.”
— AIA response from Patrick Panetta, ASU; and Chris Knorr, SmithGroupJJR

“All industries, including commercial real estate and architecture, will need to continue to evolve and adapt to emerging technologies. Specifically in the fields of alternative energy and sustainability. I believe the next few years of those 10 years a lot of attention will need to be spent on repurposing existing buildings and facilities. We will obviously need to remain flexible to adapt to the process of becoming stabilized.

“Because technology and technological advances are changing at an exponential rate, I think the next 100 years is beyond reasonable comprehension. Who would have thought 100 years ago that we would be where we are today. However, architecture and real estate haven’t significantly changed over the past 100 years, but we also have not had the multiplying pace of technology at our disposal. Who knows, things like tele-transporting may be a reality over the next century, which of course would drastically change architecture and commercial real estate.”
— Patrick Hayes, President and CEO, PHArchitecture

Legal

“For approximately the first third or half of the next 10 years, commercial real estate will need to focus on absorption and modification to meet current needs of those projects that resulted from overbuilding during prior ‘blow and go’ times in our industry. Creativity and cost-effective adaptation will be needed to recast non-performing or under-performing commercial assets into assets that can meet the needs of current real estate users. As an example, big box retail spaces that have gone dark will need to be adapted and converted into creative uses to accommodate smaller and even different users. Cities and counties may need to modify their zoning to allow for a broader variety of uses that will meet the needs of today’s users.

“One hundred years is a long time and it is difficult and somewhat speculative to attempt to predict what changes will most impact Arizona over such a long time period. However, I suspect that big box retail will downsize as Internet shopping grows over the many years to come. I also suspect that growth in Arizona will have to adjust to demands upon the availability of water and our entire culture will eventually take on a more serious and long-term water approach to and conservation.

“Arizona will need to adapt its economy to more self-sustaining business that is not so dependent upon growth and real estate development. Thus, over the next 100 years Arizona will need to modify its tax and development schemes to accommodate more industry and manufacturing. Finally, Arizona will develop more political clout in Congress and the federal government as its population grows and the state’s economy continues to mature.”
— Don Miner,  Director, Fennemore Craig PC

Construction

“The impact construction will have in Arizona over the next 10 years will start with job creation. As the market comes back, the industry will be a leader in putting people back to work. We will need people to fill both direct construction jobs, and jobs that are indirectly related to construction. Every $1B spent in construction results in a total of 20,000 direct and indirect jobs. These jobs will help the middle class, the hardest hit in the last few years in terms of job loss.

“Construction is one of the top five industries nationally, and by then (10 years from now) it will be back among the top five industries for Arizona. Finally, the use of public/private partnerships will increase to meet community needs for amenities, infrastructure and growth.”

“Also, in Arizona, construction will be essential in reshaping the suburban landscape of our past into the more blended and integrated urban and semi-urban environment for the future. We are seeing new demographics that have families from multiple generations that live under one roof, and this factor along with other market forces will increase density in the mixed-use urban environment.”
— Eric Hedlund, Executive Vice President and COO, Sundt Construction

Finance

“Financing will always be a key part to Arizona’s growth. How products and services will be delivered will continue to evolve. As the market heals more competition enters into the marketplace thereby giving more investors access to capital. Assuming the economy has healed and is robust, I see a lot more choices for investors, developers and consumers in the next 10 years when it comes to the availability of financing.

“In the next 100 years? The market will always go up and down and therefore there will be more boom and busts as the decades roll forward. The difference in the future is access to information becoming more available than previous decade. The speed of that information will cause market trends to shift faster. Volatility could be more frequent.”
— William L. Spart, Senior VP, Wells Fargo Bank-Real Estate

For more information on Arizona’s construction projects and new commercial development, visit az.gov.

AZRE Magazine January/February 2012

Newsmakers, AZRE Magazine March/April 20111

Newsmakers: AZRE Magazine March/April 2011

Newsmakers: March/April 2011

Rommie Mojahedand Mary Ridberg were appointed directors of leasing for the Phoenix office of Sperry Van Ness. Mojahed and Ridberg will be responsible for recruiting, business development and growth of the leasing team.

Brian Smuckler and Jeff Seaman joined CB Richard Ellis’ Multi-Housing Private Client Group in Phoenix. Smuckler, senior vice president, and Seaman, senior associate, will form a new team working with private-capital multi-family investors. Smuckler, who leads the team, comes to CBRE from Marcus & Millichap, where he was a director of the National Multi-Housing Group. Seaman also joins CBRE from Marcus & Millichap, where he was a senior associate. CBRE also hired Timothy Keating as senior office operations manager.

The Plaza Companies announced it is opening a new Tucson office and hired a leasing professional. Plaza Companies currently provides property management and leasing services to three medical office properties in the Tucson area: Academy Medical, Desert Medical Center, and LaCholla Medical Center. Plaza Companies has hired Lauri Abbinante, a Tucson resident who has worked in the Tucson brokerage community for more than nine years, as senior portfolio manager and leasing specialist.

Commercial Properties Inc. (CPI) has added 11 new agents over the past few months at its Tempe and Scottsdale locations. They are: John Soldo, Trent Rustan, Josh Gosnell and Brandon Koplin, Tempe; and Nicholas Miner, David Verwer, Homer Savard, Donn Kinzle, Sam Walker, Phill Tomlinson and Bob Deininger, Scottsdale

Quarles & Brady announced that Brian Booker, a partner in the firm’s Phoenix office, has been appointed to the board of directors of The Wellness Community. Booker’s practice focuses on commercial litigation with emphasis in commercial and professional liability, real estate, securities fraud and products liability.

Grubb & Ellis announced that Robert Stephens has joined the company as vice president, Industrial Group. Specializing in the representation of industrial tenants and landlords, Stephens joins Grubb & Ellis from Cushman & Wakefield, where he spent 15 years as a senior director. Grubb & Ellis also announced that Andrew Banister and Alan Gillespie joined the company’s Investment Services group as senior vice president and vice president, respectively. They will specialize in the sale of office and industrial properties.

DLR Group recognized seven individuals at its regional annual meeting. They were rewarded for their commitment to the firm and willingness to accept and excel in leadership roles. David Boehm was appointed as senior principal; Scott Shively was promoted to principal; Elizabeth Rendon and Eric Loos were promoted to senior associates; and Karen Heck, Rickey Austin, Andrew Dunlap and Jason Hocking were promoted to associates.

CB Richard Ellis promoted Gavin McPhie to managing director of its Valuation & Advisory Services (VAS) Group in Phoenix. McPhie, who has nearly 10 years of real estate appraisal and consulting experience, joined CBRE in 2005. CBRE also hired Timothy Keating as senior office operations manager.

NAI Horizon added Rick Foss to its Industrial Properties Group. He has spent the past 10 years representing a wide range of industries in the acquisition of their real estate facilities. Prior to joining NAI, Foss worked at Insignia ESG, Grubb & Ellis and Cassidy Turley | BRE Commercial in Phoenix.

Grubb & Ellis announced that Jeffrey Chalfin has joined the company as vice president, Investment Services. Chalfin specializes in the sale of multi-tenant retail assets and joins Grubb & Ellis from Sperry Van Ness, where he began his career in 1998.

Mortenson Construction promoted Paul Kitching to director of operations. Kitching has been with Mortenson since 1997 through the joint venture project, Minnesota Correctional Facility in Rush City, Minn. He became an official Mortenson team member in the Minneapolis office in 2000, with a focus in sports and healthcare

Gilbane Building Company named D. Thomas Goderre district operations manager in its Phoenix office. Goderre will manage all of Gilbane’s business and construction operations throughout the district.

Cassidy Turley | BRE Commercial announced that Scott Boardman has joined the company’s Office Services Group as a senior associate. Boardman will be partnering with senior VPs Trevor Klinkhamer and Jeff Hartland to form a new Office Services Group team.

Cushman & Wakefield promoted Will Strong to the senior associate post within the Bo Mills and Mark Detmer Industrial Specialty Group. Strong specializes in representing and consulting corporate tenants, institutional landlords and developers in the acquisition, development and disposition of industrial real estate.

Sundt Construction promoted three employees: Thomas Mertz to senior vice president and manager of Sundt’s federal division (formerly vice president of business development); Herbert Chong to vice president of business development (formerly project director); and Gregory Ayres to area manager (formerly senior project manager).

Vince Lujan accepted the position of president and CEO of Salt River Devco, the asset management and commercial development company for the Salt River Pima-Maricopa Indian Community. Lujan, a Pueblo Indian from New Mexico, served as interim president and CEO of Devco since March 2010. Jeff Roberts was appointed asset manager and will oversee management of six commercial office buildings totaling 370,000 SF in Chaparral Business Park.

Jones Lang LaSalle vice president Jason Moore moved from the agency to the tenant representation team in the company’s Phoenix office. Moore will specialize exclusively on tenant representation and consultation for corporate clients in Phoenix.

AZRE Magazine March/April 2011

Newsmakers, AZRE Magazine March/April 20111

Newsmakers: AZRE Magazine November-December 2010

Newsmakers In Arizona Real Estate

Newsmakers in the commercial real estate industry are featured each issue. Here are the movers and shakers for November – December 2010:

Cushman & Wakefield acquired Cowen Commercial, a real estate firm specializing in retail leasing, investment sales, shopping center repositioning and development. Owner and President Jonathan Cowen, Adam Madison, Joseph Hoye II and Shannon O’Keefe joined Cushman & Wakefield. Cowen will be a senior director.

Jamie Medress was promoted to senior vice president investments at Marcus & Millichap.

Cliff David was promoted to vice president of investments. He specializes in multi-family investment sales.

Michel Ayer, an attorney at Quarles & Brady’s Phoenix office, was elected to Habitat for Humanity’s Central Arizona board of directors. Ayer is a member of the firm’s real estate group.

GPE Management Services named Linda Tierney senior property manager of the company’s property management services. She will be responsible for the direct management of RJ Realty Investors’ Phoenix portfolio.

RiverRock Real Estate Group, which will manage an unnamed client’s 1.6 MSF Phoenix industrial portfolio, named Michelle Weber as property manager to oversee the portfolio.

Erik Marsh joined Grubb & Ellis as vice president, Industrial Group, primarily specializing in sales. Marsh joins Grubb & Ellis after spending six years with Marcus & Millichap.

Daniel Mercer joined Grubb & Ellis’ Financial Services Asset Management group as senior vice president. With 37 years of experience, Mercer will oversee the company’s distressed asset services in the Phoenix region.

Karl Abert joined Grubb & Ellis as vice president, Multi-Housing Group. His team will include David Cravath, vice president, who joined the company in June.

Laurel Lewis joined NAI Horizon’s Office Properties Group. She spent the past 10 years with Grubb & Ellis.

Geoffrey Harris was promoted to vice president capital markets with Mark One Capital. Harris began his career with MMCC in 2006, specializing in single-tenant/retail.

Tim Phillips joined GPE Commercial Advisors as associate vice president specializing in industrial, flex and office property sales and leasing.

Raul Abad rejoined the Phoenix office of Gust Rosenfeld and will focus his practice on commercial real estate transactions, including development, leasing, financing and acquisitions and dispositions. He was practicing law in Denver.

Mark Dillon was named designated broker for Cassidy Turley BRE Commercial. Dillon joined the firm in December 2006, and is adding to his current position as vice president and general counsel.

Faris Lee Investments, a retail investment firm, opened a Phoenix office and named David Wetta as senior member overseeing a 3-person team. Wetta previously was with Marcus & Millichap. Joining Wetta: Joseph Compagno, Paul Salinas and Nathan Hubbell. All 3 were formerly with Marcus & Millichap.

MODE Real Estate Management Services hired Gina Rouban as assistant property manager.

Quarles & Brady attorney Katea M. Ravega was elected treasurer of the U.S. Green Building Council Arizona Chapter. Ravega is a member of the firm’s Environmental Law Group and a LEED accredited professional.

AZRE Magazine November/December 2010

Advantage Business Park, AZRE July/August 2008

Mixed-Use: Advantage Business Park


ADVANTAGE BUSINESS PARK

Developer: Phone Jockey Land Partners #1 LLC
General contractor: TBD
Architect: PH Architecture
Location: SEC Alma School & Pecos roads, Chandler
Size: 131,000 SF

The $25 million project consists of three, single-story retail buildings totaling 30,000 SF, and on 3-story office building at 101,000 SF. Construction is scheduled to begin 4Q08, with an estimated completion date of 2Q09. Brokers: Retail – Grubb & Ellis; Office – Cushman & Wakefield

AZRE July/August 2008