Tag Archives: JLL

McDowell Mountain Business Park

McDowell Mountain Business Park sells for $10.5M

The Phoenix office of JLL has just closed a $10.5M ($164.67/sf), three-building flex office portfolio sale in McDowell Mountain Business Park, a segment of metro Phoenix that for years has sustained a sub 10-percent vacancy rate for its class-A flex office and industrial space.

“This is a niche area of the northwest Valley that appeals to tenants looking for superior office, flex or industrial space,” said JLL Senior Vice President Brian Ackerman, who represented property seller Aegis I, LLC in the portfolio sale. “It’s less than one mile from two Loop 101 freeway interchanges and only a few miles from the Scottsdale Airport, McDowell Mountains and some of the Valley’s most elite executive housing, retail and dining. The location, combined with the quality construction of these three buildings, will definitely stand the test of time.”

The three-building sale totals 63,763 square feet of institutional-grade flex office space at 9171 E. Bell Road, 9181 E. Bell Road and 16611 N. 91st Street in Scottsdale – at the southeast corner of Bell Road and 91st Street, just off of the Loop 101 freeway. All three buildings feature modern architecture, high ceilings and roll-up doors to accommodate high-profile retail showroom businesses and office users.

The portfolio sits within the McDowell Mountain Business Park, which totals more than 2.2 million square feet of office, flex and industrial space designed for tenants needing quality space in a premier Scottsdale Airpark location.

According to JLL, the combined vacancy rate for the park’s 50 buildings has remained at sub-10 percent throughout the recession. That rate is even lower today, now at a combined 5.2 percent vacancy. At the same time, rental rates in McDowell Mountain Business Park have continued to increase, with many buildings now hitting $1.00 per-square-foot NNN and higher for quality class-A product.

The portfolio buyer, California-based Crown West Realty and Development, represented itself in this sale. Michelle Gardner with Shell Commercial will continue to maintain the buildings’ leasing assignment.

Crossroads of Tempe

97KSF office at Crossroads of Tempe sells for $17.25M

ViaWest Group has sold 96,691 SF of office space within the commercial complex, Crossroads of Tempe. Phoenix-based ViaWest Group acquired the nearly vacant office-retail property in 2011 for $4.055 and sold the retail portion shortly after for $1.3M. Four years later, after investing in the two remaining vacant, shell condition office buildings, ViaWest Group (in a joint venture with Southwest Value Partners) has sold the project for $17.25M. The buyer was Los Angeles, CA-based Held Properties, Inc, represented by Chris Toci and Chad Littell of Cushman & Wakefield of Arizona Inc. in Phoenix and Mark Gustin, Karsten Petersen and Dave Seeger of Jones Lang LaSalle in Phoenix. Located at 303 & 309 W. Elliot Road on the northwest corner of Elliot Road and Kyrene Road in Tempe, the property is now 96 percent occupied.

“The new buyer of this project recognized the strength of the tenants, the quality of the property and the prime location for technology-based and other companies. This project is indicative of the vision and efforts of our team. We purchased an asset that was completely vacant during a very difficult period and negotiated for additional parking, built-out high end space, and positioned the buildings perfectly for tenants in the market,” says Steven Schwarz, co-founder at ViaWest Group.

“Crossroads of Tempe is located in the epicenter of metro Phoenix’s high-growth technology
trade area, the Southeast Valley, and is directly linked to the surrounding supply chain,” said
Chris Toci. “At 96 percent occupancy, the Property is leased to a mix of technology-focused tenants, each integrally connected to their nearby technology based clients.”

Tech companies have been relocating to the Southeast Valley in large numbers in order to compete for the local talent that comprises the region’s most well-educated labor pool. Numerous household names have settled in the Southeast Valley including Go Daddy, AVNET, Qualcomm, Iridium Satellite, Intel, Motorola, Honeywell, Xerox, Microsoft, Bank of America, Wells Fargo, eBay/PayPal, and AT&T.

“The property also offers immediate access to local executive housing and high-end demographics with median household incomes of more than $100,000 per year” said Chad Littell. High paying employment opportunities in technology-based fields are luring skilled workers to the area to avoid the congested commutes into Phoenix and Scottsdale.

Crossroads of Tempe meets the needs of the Southeast Valley workforce through its high-end design, on-site amenities, abundant parking, prominent identity, and convenient tenant access. The property has emerged as the ideal open office solution in a submarket currently short on
options.

Mark Gustin, Karsten Petersen and Dave Seeger of JLL will serve as the leasing brokers on the property and ViaWest Group will continue to serve as the property manager.

Mike

Mike Ruppert joins JLL

Institutional Investors’ desire to increase property values through the use of property management and agency leasing expertise has led JLL to add experienced talent to its roster.

The firm today announced Mike Ruppert has joined its property management platform as Senior Managing Director, Southwest Region and property management lead for the Southwest region, including Phoenix

“Mike’s proven track record of excellent client relationship management, combined with his ability to drive portfolio values, made him the obvious choice for the role,” said JLL President of Property Management Dan Pufunt. “Our clients will benefit immensely from his addition to our platform.”

“The Southwest markets are already key targets for the investment community,” added JLL Southwest Market Director Peter Belisle. “Having Mike join JLL will allow us to add value in locations where we have a strong footprint, enhance service delivery and relationships with clients, and increase presence in the Southwest CBD markets.

A more than 25-year industry veteran, Ruppert brings expertise in managing client relationships, coordinating best practices and executing management and leasing strategies on portfolios of office, industrial, retail and medical office assets. He previously served in leadership positions with notable real estate services and development firms, a public office REIT and a private ownership firm. Mike pursued his degree in Business Administration from the University of Minnesota-Winona.

Architectural Photography by Michael Baxter, Baxter Imaging LLC

Tuesday Morning Corp. signs 593KSF spec lease

Liberty Property Trust announced that Tuesday Morning Corporation has signed a 10-year lease for 593,600 square feet at Liberty Logistics Center I in Phoenix. The national retail chain will occupy the entire facility, located at 563 S. 63rd Avenue, in September.

Liberty acquired the building in 2013 and marketed the facility to potential distribution center users looking to expand in or relocate to Phoenix.

“The Southwest Phoenix Industrial submarket has been poised for rapid growth and we are delighted that Tuesday Moring has chosen Phoenix, and its quality of life amenities, over other cities that were in play for the company’s new West Coast distribution center,” said John DiVall, senior vice president at Liberty Property Trust. “Liberty Logistics Center I exceeds the logistics industry’s demands for today’s multi-channel fulfillment needs. It is a one-of-a kind facility.”

Liberty Logistics Center I is a state of the art LEED® facility that features cross-dock loading, 32’ clear heights, a fully gated concrete truck court, seven points of ingress and egress, R-19 insulation and skylights on 2-percent of the roof.

“We are excited to be opening our new Phoenix facility which will serve our stores in the Western United States. This is an important step in the building of our overall supply chain strategy which will ultimately involve a new facility serving the East Coast and a replacement of our current Dallas distribution center with a new state of the art center,” said Douglas B. Sullivan, senior vice president of real estate for Tuesday Morning Corporation.

With its efficient highway system, ample labor pool and proximity to California, demand for industrial space in Greater Phoenix continues to exceed available product on the market.

“After exploring numerous markets in the Western U.S., Tuesday Morning ultimately selected Phoenix as a result of a vast workforce and strong talent base in Greater Phoenix,” said Chris Camacho, president and CEO of the Greater Phoenix Economic Council. “The new logistics center in Phoenix will provide hundreds of new jobs for the region and added connectivity to a large customer base. We’re excited to welcome them to Greater Phoenix.”

Don MacWilliam, Payson MacWilliam and Tom Woods of Colliers International represented Tuesday Morning and Marc Hertzberg and Tony Lydon of JLL represented Liberty in the transaction. Megan Creecy-Herman managed the transaction for Liberty.

Oblique & Renderings of Airport I-10-1

Airport I-10 announces three national tenant leases

Just as Airport I-10’s 600KSF Phase I approaches completion, Wentworth Property Company/Clarion Partners and the Phoenix office of JLL have announced the signing of three major, national tenant leases that bring one of the largest speculative office projects in Phoenix history to more than 35 percent pre-leased.

The new tenants at Airport I-10 include:

• DLS Worldwide, a major, volume-leveraged third-party logistics provider, leasing 78,843 square feet in Building B for a new headquarters, light manufacturing, assembly and distribution facility.

• DHL, the world’s leading postal and logistics group, leasing 40,529 square feet in Building E for a regional parcel delivery hub.

• Pilot Freight Services, a worldwide provider of transportation and logistics services, leasing 31,824 square feet in Building E for centralized pick-up and delivery service operations.

JLL Executive Vice Presidents Pat Harlan and Steve Sayre, and JLL Associate Kyle Westfall represented Wentworth/Clarion in all three leases. Mike Gordon of Cresa represented DLS. John Werstler, Jerry McCormick and Cooper Fratt of CBRE represented Pilot. Jim Wilson of Cushman & Wakefield represented DHL.

The new leases join with a 63,470-square-foot pre-lease completed by JLL in mid-2014 with Anixter International, Inc., a leading global distributor of enterprise cabling and security solutions, electrical and electronic wire and cable, and OEM supply fasteners and other small parts.

Inclusive of Anixter, this brings JLL’s new lease commitments at Airport I-10 to 215,000 total square feet, leaving the project’s three-building, 600,000-square-foot Phase I at 35 percent leased, before construction is even finalized.

“Modern companies want modern buildings. This is making all types of users more sophisticated about what they look for in an industrial location,” said Harlan. “They are requiring the kind of improved function that you get from features like higher clear heights, better overall building layout and better truck maneuverability. Airport I-10 checks all of these boxes, and because of this is attracting tenants making an overall flight to quality – a trend that is happening across the entire industrial market.”

“Airport I-10 was designed to give modern industrial tenants a home in the heart of Phoenix’s industrial distribution network. We couldn’t be more pleased with the companies that have committed to space here,” said Wentworth Property Company Principal James R. Wentworth. “They are a barometer of the types of businesses that we believe will continue to chose Airport I-10 and build out one of the submarket’s best and last industrial parcels.”

Located at the northwest corner of 24th Street and Rio Salado, Airport I-10 Business Park represents the last large, developable parcel left in the Sky Harbor International Airport submarket. Phase I includes three Class A industrial buildings totalling more than 600,000 square feet (277,954 square feet, 169,109 square feet and 156,000 square feet). This portion of the project is 35 percent pre-leased to Anixter, DHL, DLS and Pilot.

At build out, the 58-acre Airport I-10 property will include five Class A industrial buildings totalling 920,584 square feet, with a modern environment for corporate users and fully equipped with state-of-the-art features such as ESFR sprinkler systems, 30- to 32-foot clear heights, cross-dock loading and 140- to 200-foot truck courts.

CanyonVillage 8x5

JLL completes sale of DC Ranch project for $18.7M

On behalf of Arizona-based DMB, the Phoenix office of JLL has completed the $18.7 million sale of Canyon Village, a Class A mixed-use office project and cornerstone development within the DC Ranch masterplanned community in Scottsdale, Arizona.

JLL Senior Managing Director Dennis Desmond and Senior Vice President Brian Ackerman represented the property seller, Canyon Village LLC (an entity of DMB), in cooperation with DMB Vice President of Development Michael Burke and Director of Leasing and Sales T.A. Shover.

The team was assisted by Alfred Hackbarth, retail investment expert and Senior Vice President of SRS Real Estate Partners, and by JLL office leasing experts, Managing Director John Bonnell and Vice President Brett Abramson.

The buyer is Laurus Corp., a Los Angeles-based private real estate investment and development firm.

“As a DMB-built project, Canyon Village carries an unwavering quality and value in a niche location. There is no other office property quite like it in North Scottsdale,” said Desmond. “This buyer purchased Canyon Village knowing that Class A office space in Phoenix is coming back very strong and very quickly. They have tremendous confidence in that recovery and in this superior asset.”

Totalling 93,890 square feet on 5.6 acres, Canyon Village includes four buildings and an adjacent 289-car parking structure. It is located at 18801, 18835, 18867 and 18899 N. Thompson Peak Pkwy. in Scottsdale, on the northeast corner of Thompson Peak Parkway and Legacy Boulevard, and in the heart of DC Ranch, an 8,800-acre masterplanned community situated at the base of the McDowell Mountains. It is just five minutes from the Loop 101 freeway.

Canyon Village is primarily home to office tenants, but also includes high-end medical office, retail and restaurant users such as Ciao Wine Bar & Bistro and The Village Health Club’s hot yoga studio. It is an immediate neighbor to the award-winning DC Ranch Village Health Club and Spa, and Silverleaf, a 2,000-acre private residential community boasting high desert canyons, a world-class golf course, limited custom homesites starting at $1 million and ranging from 1 to 15 acres, and luxury homes from $1 million to more than $7 million. The 2014 median home value within a one-mile radius of Canyon Village was $608,782 – a more than 300 percent difference from the $195,930 2014 median home value for all of metro Phoenix.

“It is rare to find all of these amenities in one location – a landmark site, a highly designed formal Mediterranean environment, almost unrivalled access to executive housing and decision makers, a highly educated labor pool and meticulous property management,” said DMB Vice President Mike Burke. “We took all of these factors into consideration when building Canyon Village, laying a strong foundation for a long-term success story.”

At the time of purchase, Canyon Village was 75.9 percent leased, with expectations that this figure will increase quickly as development continues around the site and the Phoenix office market enjoys a sustained recovery.

According to JLL research, the subset of Phoenix’s Class A office space is significantly outperforming all other office classes. As of year-end 2014, the Class A vacancy rate was 18.7 percent (compared to 21.4 percent Valley-wide) and accounted for 60 percent of the year’s total net office space absorption.

New Arizona child safety department leases 112KSF

CBRE and JLL have negotiated a new 112,323-square-foot lease at Phoenix Corporate Tower located at 3003 N. Central Ave. in Phoenix. The tenant, who will be occupying space for administrative purposes, is the recently formed Arizona Department of Child Safety.

 

Dave Carder, Luke Walker and Eric Schultz with CBRE’s Phoenix office represented the landlord, a joint venture between Colony Capital and Montana Avenue Capital. The tenant was represented by Pat Williams, Andrew Medley, Steve Corney, Vicki Robinson and Chris Corney with JLL’s Phoenix office.

 

“The Midtown office market is currently experiencing a resurgence in tenant activity due to the central location, light rail access, walkable amenities, affordable rates and increased investment by multi-family and residential condo developers,” said CBRE’s Carder.

 

Phoenix Corporate Tower is a 445,811-square-foot26-story Class A office building in Midtown Phoenix. The landmark building, originally completed in 1965 and renovated once in 2006, has recently undergone another round of renovations. In the past 12 months the building owners invested in exterior paint, landscape improvements and upgraded modern lobby finishes. The building owners are currently in the design phase for further improvements to the common areas in and around the building.

 

 

Fractured condominiums turns class-A apartments

The Phoenix office of JLL has completed the $18.1 million investment sale of Indigo, a formerly fractured Phoenix condominium asset that over 24 months was transformed into a high demand, 108-unit Class A apartment community.

JLL Executive Vice President John Cunningham and JLL Vice President Charles Steele represented the seller, Seattle-based Goodman Real Estate. The buyer was Belkorp Holdings, Inc.

“Goodman recognized the potential of Indigo as a rental versus for sale project, and simultaneously executed a development and buy-back strategy to ‘de-fracture’ the community,” said Cunningham. “This is a great case study demonstrating the recovery of our multifamily market.”

Indigo is located at 16160 S. 50th Street, near I-10 and Chandler Boulevard in Phoenix’s Ahwatukee submarket. Goodman purchased the property in 2013 as a fractured multifamily development, with 17 of its 30 Class A units previously sold as condominiums and with the infrastructure in place to build an additional 78 units. Over 24 months, the owner acquired many of the previously sold units and developed the additional 78 units to de-fracture the 108-unit community to 101 rental units and seven individually owned units.

Today, Indigo features one- and two-bedroom, open-concept floorplans ranging from 903 square feet to 1,524 square feet. Unit amenities include stainless steel appliances, granite countertops, in-home washers and dryers, walk-in closets and personal patios or balconies. On-site amenities include a resident lounge, fitness center and resort-style pool and spa with cabanas and barbeques.

The project currently sits at 94 percent occupied.

“Phoenix added more than 55,000 jobs last year, which helped push the metro multifamily vacancy rate to 5 percent,” said Steele. “While single family home starts continue to lag the long-term trend, we feel that robust employment and population growth will be the catalyst for stronger absorption of multifamily units in the coming years.”

RiverwalkArizona, WEB

Soilworks establishes its HQ in Scottsdale

On behalf of Arizona-based Soilworks, the Phoenix office of JLL has completed a class-A office lease in Scottsdale that establishes a new world headquarters for the company – a leader in dust control and soil stabilization technology.

Soilworks moved into its new headquarters space this month. The location, at 7580 N. Dobson Road in Scottsdale, sits just east of the Loop 101 freeway within Riverwalk Arizona, a $400 million, Class A corporate campus slated for up to 1.5 million square feet of high-end office and retail space.

JLL Managing Director John Pierson and Associate Trevor Pratt represented Soilworks in the transaction. The landlord, The Alter Group, was represented internally by Justin Miller.

“This is a natural progression for our company and one that we’re excited to make,” said Chad Falkenberg, founder of Soilworks. “It caps off one of the best years our company has ever had.”

“This lease provides Soilworks with an efficient, comfortable and central headquarters location with top notch accessibility for clients and employees,” said Pierson. ““It is the perfect example of a growing Phoenix business that is using one of our Valley’s vibrant, Class A corporate environments to build connections and opportunity.”

In addition to its new Scottsdale headquarters, Soilworks also operates a production facility in Chandler, Ariz. The Chandler property remains home to the company’s large-scale heavy industrial production plant, equipment yard, warehouse and 26-car rail spur.

Talavi, JLL, WEB

Phoenix Heart buys its office building

In a deal that points to rising corporate confidence, the Phoenix office of JLL has completed a $6.25 million class-A office building sale that brings Phoenix Heart – the anchor tenant at 5859 Talavi – from project tenant to project owner.

JLL Senior Vice President Brian Ackerman represented the property seller, Credit Union West, in the transaction. Marcus Muirhead of Colliers International represented Phoenix Heart.

Recognized as a leading Valley cardiology group, Phoenix Heart PLLC currently occupies 50 percent of the 35,904-square-foot building at 5859 W. Talavi Blvd., within the Talavi Business Park in Glendale, Arizona. The building’s remaining space is fully occupied by quality tenants including Credit Union West, John C. Lincoln and Wallick & Volk.

“This deal points to a new level of confidence and solid market recovery,” said Ackerman. “Five years ago, recession fundamentals and uncertainties would have blocked this type of sale, but today the outlook is optimistic. Tenants are more confident, and considering opportunities to buy their buildings and secure the benefits of a market upswing.”

The 5859 Talavi building is located near the southeast corner of Bell Road and 59th Avenue in Glendale, Ariz., with an immediate area that is inundated with retail amenities that attract tenants to work in Talavi Business Park. It is adjacent to the Talavi Town Center retail project and surrounded by neighbors such as the Thunderbird School of International Business, ASU West and Midwestern University.

Tiger Industrial Center, via ViaWest Group

ViaWest Group acquires Tiger Industrial Center

ViaWest Group announced the recent acquisition of two multi-tenant, industrial buildings collectively referred to as Tiger Industrial Center. Located at 4901 & 4929 W. Van Buren, the complex is comprised of 103,064 SF. Sold on December 30, 2014, Phoenix-based ViaWest Group paid $4.55MM acquisition. This is the first acquisition in ViaWest’s new fund focused on the purchase of industrial assets in the Southwest U.S. Two other assets are in escrow presently and will close this month. The seller was KTR Arizona LLC, and the buyer and seller were both represented by Tony Lydon, Marc Hertzberg and Riley Gilbert at Jones Lang LaSalle.

Tiger Industrial Center is located at the southeast corner of Van Buren Street and 51st Avenue, just south of a full diamond interchange at the I-10 Freeway. Currently 16 percent leased, the subject is situated within one of the largest industrial submarkets in Phoenix.

ViaWest plans to make some strategic improvements to the property and lease the balance of the space to tenants needing warehousing and manufacturing uses. Tony Lydon, Marc Hertzberg and Riley Gilbert at JLL will continue leasing the property on behalf of ViaWest.

“This property is a great fit as the first investment in our new fund, which is focused on acquisitions of well-located general industrial and multi-family properties, in recovering secondary markets in the Southwestern U.S., at significant discounts to replacement cost,” says Gary Linhart, Founding Principal at ViaWest Group.

Marc Hertzberg of JLL expressed, “This asset is uniquely positioned to cater to 10,000 to 75,000 SF tenants that want a prime, infill location that provides all the function needed in today’s world at extremely competitive rental rates.” ViaWest Group intends to hold the property for investment and will serve as the property manager and asset manager.

Camelback Commons, CushWake, WEB

Premier Business Centers inks 1st Arizona lease

Cushman & Wakefield of Arizona, Inc. has negotiated a lease on behalf of Premier Business Centers for its first opening of executive office suites in Arizona, located at Camelback Commons, 4742 N. 24th St.

The company, which is headquartered in Irvine, Calif., has signed a 10-year lease for 13,516 square feet on the third floor of the building.  The company plans to open its executive suites facility in March 2015.  The Premier Business Center will include 53 executive suite office spaces, two meeting rooms, a day office, kitchen and reception area.

“We are excited to enter the Arizona marketplace and provide our services to the state’s growing business community,” says Jeff Reinstein, Chief Executive Officer of Premier Business Centers.  “This is the first of several locations we plan to open in dynamic business corridors within the city.”

“This particular building provides a great central location in the Camelback Corridor, which is very appealing to executives who operate small companies or are in an incubation phase of their businesses,” says Larry Downey, Vice Chairman of Cushman & Wakefield.
Premier Business Centers, LLC is one of the country’s leading operators of executive suites and office centers.  Offering more than 70 locations throughout the United States, Premier Business Centers provides professional work environments that can be rented by the hour, day, month or year.

Downey exclusively represented Premier Business Centers in the site selection search and lease negotiations.  John Bonnell and Brett Abramson of JLL represented MS MCC Highland, LLC., owner of Camelback Commons.

Economic Forecast

IREM, CCIM announce 9th annual CRE Economic Forecast

IREM and CCIM will present the 9th annual commercial real estate Economic Forecast at the Tempe Center of the Performing Arts on Thursday, Jan. 15, 2015. IREM and CCIM will begin the program by honoring Jerry Colangelo, who will be recognized as the Person of the Year by the organizations.

The panel discussion will be moderated by Peter Bolton of Newmark, Grubb, Knight, Frank. Each panel member will discuss their area of expertise as it relates to the current commercial real estate environment and then predict, based on the metrics of the commercial real estate business, achievements by year’s end.

The program will begin at 8 a.m. and continue until noon. The program will include;
Jerry Colangelo Program Honor

Multi-Family Panel
o    Cindy Cooke – Colliers International
o    Mark Schilling – MEB
o    Tom Lewis – Alliance

Office Panel
o    Jim Fijan – CBRE
o    Chris Toci – Cushman & Wakefield
o    Matt Mooney – Parkway Properties

Retail Panel
o    Judi Butterworth – Velocity Retail
o    Greg Laing – Phoenix Commercial Advisors
o    Pat McGinley – Vestar

Industrial Panel
o    Stein Koss – Lee & Associates
o    Tony Lydon – JLL
o    Mark Singerman – Rockefeller Group

The Tempe Center of the Arts is located at 700 W Rio Salado Parkway, Tempe, Ariz., and more information on the 2015 IREM/CCIM Economic forecast can be found here.

Esplanade rendering, courtesy of CBRE

Esplanade to undergo Gensler-designed renovations in 2015

The Esplanade has announced that the mixed-use development will undergo renovations to its ground plane and retail space with work slated to begin in first quarter 2015.

Renovation plans currently include strategies to open up the three main entry points to the retail portions of the property to make them more inviting and accessible to visitors. Additionally, the walkways will be redesigned so retailers can provide their customers with indoor/outdoor spaces in which to shop and dine. The central corridor will be reimagined to create a community square offering a space for the Esplanade community to come together. The space will offer outdoor seating as well an area for community events.

The Esplanade is one of the area’s most prestigious and sought-after office locations; it’s the heart of the Camelback Corridor,” said Andi St. John, managing director of Asset Services with CBRE, which oversees management of the entire Esplanade complex. “The planned renovations will capitalize on the existing cache commanded by the property and create a first-class retail experience better connecting the complex to the Biltmore community.”

MetLife, the owner of the property, has tapped CBRE to oversee management of the renovations. Gensler has been selected as the project’s architect and design firm. A general contractor has yet to be announced. CBRE is also responsible for property management and the marketing and leasing of the retail portions of the property. JLL handles the marketing and leasing of the office space.

Located on E. Camelback Rd. in Phoenix, the Esplanade benefits from proximity to a wealth of amenities, including adjacency to the Biltmore Fashion Park with its myriad of iconic retailers and restaurants. Offering office tenants a vibrant community in which to work, shop and dine, the Esplanade epitomizes the “lifestyle” type of work environments modern office users want.

Real estate professionals recognize that economic drivers are moving move back to city-centers and office buildings can no longer just be office buildings,” said Traci Russell, vice president with CBRE, who oversees the marketing and leasing assignment on retail space at the Esplanade. “The Esplanade already offers office tenants a mixed-use, well-amenitied environment in a core location. With the planned renovations the complex will be elevated to become the epicenter of the Biltmore community. Not only will office tenants benefit, but the Esplanade will become a place for neighborhood residents and Biltmore visitors to gather and connect as well.”

Chris Latvaaho joins JLL office leasing group

Chris Latvaaho, JLL

Chris Latvaaho, JLL

The Phoenix office of JLL has hired local broker Chris Latvaaho as Vice President in its Phoenix office leasing group. Latvaaho joins the existing JLL team of Managing Director John Bonnell and Vice President Brett Abramson, who specialize in agency representation for existing and ground-up developments, and both institutional and entrepreneurial landlords.

Prior to Joining JLL, Latvaaho served for 14 years as an associate director in the Phoenix office of a national commercial real estate brokerage firm. In that time, he completed more than 500 lease and sale transactions, particularly in the core business of leasing and investment sales, and with a strong emphasis on owner representation. Latvaaho started his career with Heitman Properties in Minneapolis, where he was responsible for managing a large office investment portfolio for institutional clients.

“I’ve had the pleasure of working with Chris on several transactions, and have seen firsthand his strong business acumen and client commitment,” said JLL Senior Managing Director Dennis Desmond. “We are thrilled to welcome him.”

“The Phoenix office market is definitely heating up,” said Bonnell. “Chris’ strong skill set and reputation will be a valuable part of our bench as we pursue opportunities in this rebounding economy.”

Latvaaho earned a bachelor’s degree from the University of Northern Iowa in Cedar Falls. He is a member of the National Association of Industrial and Office Properties (NAIOP).

1100 N. Hamilton_office

Bell Steel buys industrial property in Chandler

CBRE has completed the sale a 46,119-square-foot industrial property located at 1100 N. Hamilton St. in Chandler, Ariz. The property, which sits on 14.83 acres, commanded a sale price of $4.5 million.
Evan Koplan and Mike Parker with CBRE’s Phoenix office negotiated the sale on behalf of the seller, TW Steel of Chandler. The buyer, Gilbert-based Bell Steel Inc., was represented by Steve Larsen with JLL.
1100 N. Hamilton Street in Chandler is an extremely unique opportunity given its size, heavy industrial zoned land, cranes, power, and location within the thriving Chandler submarket,” said CBRE’s Koplan. “We were able to find the buyer, who instantly found value in all of the existing improvements, within hours of bringing this property to the market. With the Chandler submarket vacancy rate just above 6 percent for this particular product type, it’s currently very challenging for a user to find existing opportunities like this.”
The property at 1100 N. Hamilton Street features a mix of  buildings on heavy industrial land. The sale included a 4,000-square-foot office building, a 29,319-square-foot fabrication building, a 10,800-square-foot office/warehouse building and a 2,000-square-foot storage building all on 14.83 acres. The property also features multiple cranes with heavy power and covered parking.

Infusionsoft

Opportunity for high-tech firms spills into Phoenix’s suburban markets

As goes the high-tech industry, so goes opportunity. Once a high-tech company anchors a neighborhood, housing prices rise, new amenities spring up and unemployment dips. JLL’s latest High-Technology Office Outlook reveals where high-tech companies are looking for (and finding) reasonably priced labor and real estate, and how new and unexpected markets like suburban Phoenix are getting a piece of the action—and a second economic wind.

“Tech companies are looking for new locations for many reasons, not just for intellectual capital, or venture capital funding but other factors such as standard of living,” said Julia Georgules, co-lead of JLL’s Technology research group.  “In our research, we call this ‘market dynamism.’ We have looked at different lifestyle factors for each of the 34 tech hubs, including proximity to transport and walkable amenities.”

JLL’s report, which helps high-tech companies make informed expansion decisions and provides insight for investors, features the top 34 high-tech markets across the country, including Phoenix.*

Follow the Hipsters

While the high-tech industry’s growth is driving employers to find new locations for both talent and real estate, traditional high-tech cities are not exactly struggling. Long-standing hubs continue to function as the industry’s economic engines; in fact, seven traditionally high-tech-centric markets represent more than a fifth (21.7 percent) of the 65.4 million square feet of office space under construction across the country. Still, looking beyond the top tier locations is when the economic story gets interesting.

As rents escalate and space becomes scarce in mainstay markets like San Francisco, Silicon Valley and Manhattan, the lure of more affordable prices have high-tech companies seeking talent and real estate elsewhere. The savings potential is huge: downtown Palo Alto, considered the heart of Silicon Valley, has seen such high demand that the office market is just 3.6 percent vacant with average asking rents at $86 per square foot compared to the national average of $30. In comparison, the average asking rent for high-tech office space in Phoenix is $21.11 per square foot. Twenty six percent of the total supply is available, and 2.3 million new square feet is under construction.

“High-tech’s growth is not exclusive to traditional high-tech markets anymore,” said Cara Trani, co-lead of JLL’s Technology brokerage group. “High-tech clusters have become much more common as high-tech innovations form the backbone of new product development in all industries.”

“The race is on among cities vying to become ‘the next Silicon Valley.’ As a result, more incentives and tax credits become available to lure high-tech companies into markets that are in need of jobs and economic growth,” she concluded.

The New Tech Frontiers

Along with emerging high-tech centers like Detroit, Charlotte, and Indianapolis, Phoenix, and particularly its Southeast Valley suburbs, are holding their own.

“Phoenix is definitely an emerging high-tech market,” said Andrew Medley, Vice President, Tenant Relations in the Phoenix office of JLL. “The most interesting part of this growth may be the building locations themselves—a huge percentage are in suburban markets like Chandler, Tempe and South Scottsdale. These are places that are known for young, educated families and quality of life. When Apple moved here, they did not go into the core. They went to Mesa and introduced hundreds upon hundreds of new jobs. The same can be said for many other companies… Intel, Honeywell, GoDaddy, InfusionSoft. The list goes on and on.”

According to the annual report, high-tech companies are also taking advantage of Phoenix’s local business incentives that make Phoenix an affordable alternative to other markets. The report also nods to employment generators like Arizona State University, University of Arizona and other respected local colleges.

“Phoenix’s current high-tech employment concentration is dominated by jobs in computer and electronic products,” said Medley. “This makes up about half of our local high-tech jobs. Another third is in computer systems design and services.”

“When start-ups and established high-tech companies look to expand, understanding the dynamics of local markets and innovation clusters is essential,” said Greg Matter, co-lead of JLL’s Technology brokerage group. “While it’s common for companies to look at just one factor, such as high-tech employment, when considering new market expansions, JLL’s index shows the decision should have greater depth. Each city has its own unique qualities that should be aligned with a company’s growth objectives. Companies should look at each location’s talent pool, for example, and ask, how are investment conditions? Do we need space to expand? What are the amenities and lifestyle factors for employees?”

About the High-Technology Office Outlook Report

The 2014 High-Tech Outlook helps technology companies make informed expansion decisions and provides insight for investors looking to find the next high-tech hot spot.  This year’s report digs deeper into what makes a market “cool” or “liveable” with a new metric included in the index: Market Dynamism. While traditional metrics such as employment, wage growth, intellectual capital, and venture funding are essential to tracking the momentum of a high-tech market, JLL studied the various amenities in the 34 markets in this year’s report to better understand what makes a market tick.

West 101 Corporate Center, CBRE, WEB

CBRE leases 67KSF to Arizona’s newly created CSFS agency

CBRE has completed two office leases totaling 67,335 square feet in Metropolitan Phoenix. The leases are representative of new office requirements by Arizona for the newly created Child Safety and Family Services agency (CSFS).

A 26,265-square-foot, full-floor space in West 101 Corporate Center, which is owned by Los Angeles, Calif.-based Regent Properties and located at 1860 N. 95th Lane in Phoenix, will service CSFS’s West Valley clients. The second location is a 41,070-square-foot office building at the Corridors business park, formerly owned by Chicago, Ill.-based The Alter Group and recently purchased by Los Angeles-based Adler Realty Group. Located at 1925 W. Pinnacle Peak Rd. in Phoenix, this location will service North Phoenix.

Jim Bayless, Ashley Brooks and Jenny Aust with CBRE’s Phoenix office negotiated the long-term lease transactions on behalf of Regent Properties and The Alter Group. The State of Arizona was represented by Chris Corney with JLL’s Phoenix office.

1860 N. 95th Lane is a three-story, class A office building located within the West 101 Corporate Center master-planned business park. The property benefits from proximity to more than 1 million square feet of retail amenities, including Gateway Pavilions and Gateway Crossing. The building also has immedate access to the I-10 and Loop 101 freeways. The tenant, whose lease agreement brings the property to 72 percent leased, will take occupancy in early November.

An 80-acre business park, Corridors currently features single-story buildings as well as land for expansion and build-to-suit opportunities. Located near the southeast corner of Pinnacle Peak Road and the I-17 freeway, the park benefits from proximity to more than 1.7 million square feet of retail amenities. Current tenants include Chubb Insurance, Arizona State Credit Union, Syntellect, Bechtel, Belcan Engineering, Kutta Technologies and Performance Software. The Child Safety and Family Services lease, whose operations will take occupancy of in early December, brings the business park to 88 percent leased.

Liberty Tolleson Center

Liberty Tolleson Center reaches 100 percent occupancy

Liberty Property Trust announced it has signed a lease with Green Light Direct Services at Liberty Tolleson Center, bringing the 200KSF project to 100 percent occupancy.

Green Light Direct Services will move into its new location, 8601 W. Washington Street, in October. Rick Collins of CD Commercial Advisors represented Green Light Direct Services and Tony Lydon, Marc Hertzberg and Riley Gilbert of JLL represented Liberty Property Trust in the transaction.

“There continues to be strong interest in high quality assets in prime locations throughout our Arizona portfolio,” said John DiVall, senior vice president and city manager for Liberty’s Arizona region.  “We’ve seen momentum in the Southwest Valley returning as of late, spanning from 50,000 square feet and up.”

Since January, Liberty has closed eight lease agreements totaling more than 500,000 square feet across the Arizona region.

Granite Commerce Center

Laminate company renews 16KSF lease at Granite Commerce Center

Cushman & Wakefield of Arizona, Inc. negotiated a long-term lease renewal at Granite Commerce Center, 405 N. 75th Ave., Suite 180, for a lamination distribution company.

The lease renewal of 15,988 square feet is for USI Inc. of Madison, Conn. USI  markets roll and pouch laminating machines and films, binding equipment and supplies and many other office accessories including photo ID systems and mounting and display boards.

“The Southwest Valley industrial submarket is one of the most desirable in Metro Phoenix for USI’s business,” said Keri Scott. “USI decided to continue its operations at Granite Commerce Center because of its proximity to major freeways so it can service clients in adjacent states.”

Scott, Jackie Orcutt and John Grady of Cushman & Wakefield represented the tenant, USI. Kyle Westfall of JLL represented the landlord, Crow Holdings of Dallas.

Airport I-10

Anixter commits early to Airport I-10 spec development

Wentworth Property Company/Clarion Partners and the Phoenix office of JLL have secured a benchmark 63,000-square-foot tenant lease commitment this week at Airport I-10 Business Park—one of the largest Sky Harbor Airport-area speculative industrial developments in Phoenix history.

The lease, made by Illinois-based Anixter International, Inc., fills almost half of Airport I-10’s “Building E” months before anticipated shell construction completion.

JLL Executive Vice Presidents Pat Harlan and Steve Sayre, and JLL Associate Kyle Westfall represented the building owner. John Werstler, Jerry McCormick and Cooper Fratt of CBRE represented Anixter.

“It is rare in today’s Phoenix industrial market to secure lease commitments on a spec property that’s still under construction—before tenants can physically see and touch the space,” said Harlan. “The fact that Anixter has signed on at Airport I-10 at this early stage speaks volumes. It is a welcome post-recession event and a strong statement about the caliber of the project and our industrial market as a whole.”

“We are extremely pleased to welcome Anixter,” said Wentworth Property Company Principal James R. Wentworth. “A commitment by such a large, well respected company confirms Airport I-10 Business Park as the preferred airport location for corporate users. It also underscores the ongoing need for new, high quality industrial product in the Airport submarket. This area continues to rank among Phoenix’s top industrial locations but has an extremely limited supply of land.”

Located at the northwest corner of 24th Street and Rio Salado, Airport I-10 Business Park represents the last large, developable parcel left in the Sky Harbor International Airport submarket. Phase I includes three Class A industrial buildings totalling more than 600,000 square feet (277,954 square feet, 169,109 square feet and 156,000 square feet). This portion of the project is slated for completion in fall 2014. For more insight from Harlan, visit http://bit.ly/1ps2sgj.

According to JLL research, while there is limited inventory of modern industrial space within the Sky Harbor Airport submarket, demand continues to climb. Of the 40 million square feet of industrial space in the submarket, only 218,052 square feet was built in 2009 or later. Yet in 2013, the Airport submarket still represented almost 30 percent of the more than 3.5 million total square feet of industrial space absorbed Valley-wide.

At build out, the 58-acre Airport I-10 property will include five Class A industrial buildings totalling 920,584 square feet, with a modern environment for corporate users and fully equipped with state-of-the-art features such as ESFR sprinkler systems, 30- to 32-foot clear heights, cross-dock loading and 140- to 200-foot truck courts.

Anixter International, Inc. is a leading global distributor of enterprise cabling and security solutions, electrical and electronic wire and cable, and OEM supply fasteners and other small parts. It operates approximately 210 warehouses in more than 250 cities and more than 50 countries.

ChandlerCorpCenter, WEB

Palisades Private Capital Fund acquires Chandler Corporate Center

Palisades Private Capital Fund 1, a $50-million Fund created by Palisades Mexico Partners (PMP), has acquired Chandler Corporate Center, a two-story, 67,561-square-foot Class A office asset in Chandler, Ariz., for $13.9 million.

PMP is a joint venture of Joaquin de Monet, founder and managing principal of Palisades Capital Realty Advisors, LLC, an investment management and advisory firm, and Sergio Argüelles, president/CEO of Monterrey, Mexico-based FINSA, one of the foremost industrial real estate development firms in the Americas.

“Chandler Corporate Center is a well located, attractive office building with sustainable features that provide the tenants with economical operations and a comfortable, healthy work environment,” said Argüelles, a Mexican real estate mogul who transformed his family-owned company into a highly successful real estate development firm in Mexico. “The asset offers our investors a stabilized, secure and growing cash flow, with the opportunity for significant rent increases as the market continues to improve,” he added.

“Growth in the region’s high-tech sector has boosted job growth, beginning in the last quarter of 2013,” explained de Monet, a successful and seasoned executive with expertise in large global real estate investments and property management. “This upturn in Chandler’s economy is increasing demand for office space and this acquisition is in the right place, at the right time,” he noted, “offering an opportunity to invest in the right cycle of the market.”

Situated on 7.24 acres at 585 North Juniper Drive northwest of Chandler Boulevard and McClintock Drive, this LEED-certified building, which was built in 2008, is PMP’s first investment in the Arizona market.  The property provides tenants, including MediServe Information Systems, STA Travel and Garmin International, Inc., ample open and canopied, surface parking spaces with an excellent 6.63:1000 parking ratio.

Jones Lang LaSalle handled the transaction for both the seller, Held Properties, Inc., and PMP.

Palisades Private Capital Fund I, which has raised $50 million in private capital and is on target to increase the Fund to $100 by yearend, is focusing on value-add, Class A and B office assets in growing western suburban markets. The Fund initially will acquire institutional-quality office assets in Southern California, Arizona and Texas. Besides the Chandler asset, PMP recently acquired a property in Southern California: 2929 Imperial, a two-story, 121,143-square-foot, office building in Brea, for $20.8 million.

PMP’s capital campaign is connecting with high net-worth individuals and family offices specifically in Mexico and Latin America. PMP will accumulate a diversified pool of suburban office properties priced below replacement cost, with solid in-place cash flow and average 75% occupancy. De Monet and his team at Palisades Capital will source investments and manage the Fund, improving the assets, creating value and capturing rent growth over the targeted hold period of three to five years.

Durango, WEB

JLL completes one of the largest industrial leases of the year in SW Phoenix

On behalf of Clarion Partners, the Phoenix office of JLL has completed a 93,489-square-foot lease with Benson Industries, LLC at Durango Commerce Center in Phoenix. The deal represents one of the largest industrial lease transactions in Phoenix’s Southwest Valley submarket this year. It also brings the 670,000-square-foot, two-building Durango Corporate Center to 91 percent occupied and locates Benson Industries into its first-ever Arizona address.

Portland-based Benson Industries manufactures curtain wall systems for skyscrapers and other commercial structures. Just one of their latest projects includes the exterior shell and glass for One World Trade Center in New York City.

“Benson secured this location primarily to serve its major construction projects in California,” said JLL Executive Vice President Pat Harlan, who represented building owner Clarion Partners along with JLL Executive Vice President Steve Sayre and JLL Associate Kyle Westfall. “By locating in Arizona, tenants can maintain direct access to California but sidestep that market’s sometimes costly barriers to entry. At the same time, they gain the benefits of Arizona’s exceptional business environment, competitive tax rates and growing economy.”

Benson will use its new Phoenix location for manufacturing, assembly and distribution. Isy Sonabend and Richard Foss of NAI Horizon represented the tenant, Benson Industries.

Situated at 2225 S. 75th Ave. in Phoenix, Durango Commerce Center is a best-in-class, institutional-grade distribution property that offers direct access to I-10, 30-plus-foot clear height, ample parking and a modern ESFR system. The project is currently 91 percent leased to tenants such as The Gap, Consumer Connect and Regal Distribution. An additional 62,305 square feet of industrial distribution space remains available for lease.

ChandlerCorpCenter, WEB

Chandler Corporate Center sells for $13.9M

Capital markets experts in the Phoenix office of JLL have completed the $13.914 million sale of Chandler Corporate Center I, a 67,561-square-foot Class A office property in Chandler, Arizona. The sale price breaks the $200-per-square-foot mark for suburban office space—a significant indicator according to JLL.

JLL Senior Managing Director Dennis Desmond represented the property seller, Chandler HFP, LLC, an affiliated entity of Held Properties, a California real estate development firm. Palisades Capital Realty Advisors is the property buyer. JLL Managing Director Dave Seeger serves as the project’s exclusive leasing broker and partnered with Desmond to market the property for sale.

“This building came out of the ground in 2008 and has outperformed the Phoenix and Chandler markets ever since,” said Desmond. “This includes through the toughest office market recession we’ve ever experienced. That is evidence of the strength of the Chandler market and was a tremendous draw for investors looking for stable acquisition properties located in high-growth markets.”

According to JLL research, in the four years from 2009 to 2012, Chandler was responsible for 66 percent of Greater Phoenix’s total office space absorption. At year-end 2013, Chandler Corporate Center I was only 8.5 percent vacant, compared to an overall Chandler submarket office vacancy rate of 13.9 percent and an overall Phoenix office market vacancy rate of 23.9 percent.

“When it comes to the velocity of our recovery, Chandler is definitely one of our market’s bright stars,” said Seeger.

Chandler Corporate Center I is located at 585 N. Juniper Drive in Chandler, northwest of Chandler Boulevard and McClintock Drive, and with direct access to the Loop 101 and Loop 202 freeways, and the burgeoning Price Road technology corridor. The two-story building totals 67,561 square feet with a 6.63/1,000 parking ratio, modern office construction and benefiting from the area’s highly educated labor pool.

JLL will retain the leasing assignment at the property and assume the property management responsibility.