CapRock Partners, a leading industrial investor, developer and asset manager in the Western U.S., today announced the development commencement of CapRock West 202 Logistics, the largest speculative industrial real estate project in the history of the City of Phoenix. CapRock is transforming one of the largest remaining infill land sites in the Southwest Phoenix submarket into a state-of-the-art eight-building, Class A industrial warehouse complex totaling 3.4 million square feet. The project will be highly accessible to key logistics transportation routes and bring much needed modern warehouse space to the Phoenix metropolitan statistical area (MSA) as it continues to experience robust population and employment growth. CapRock secured the land for the project’s development via a long-term land lease. Terms of the transaction are not disclosed.
“Phoenix is now the fifth largest municipality in the U.S. and also the fastest-growing big city. With a majority of the Valley’s new industrial product delivering in the outer submarkets such as the northwest, CapRock Partners is proud to bring CapRock West 202 Logistics to central Phoenix, in an ideal infill location close to Downtown and along a major transportation corridor,” said Bob O’Neill, senior vice president, acquisitions at CapRock Partners. “CapRock West 202 Logistics will surpass all other large-scale industrial projects within Phoenix’s city limits by more than 1 million square feet. Unmatched in magnitude, location and accessibility, the project will set a new standard for warehouse development in the City of Phoenix, drawing world leaders in distribution, manufacturing and logistics in need of contemporary space to accommodate the region’s remarkable growth.”
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CapRock West 202 Logistics’ eight buildings will range from 228,000 to 1,065,000 square feet, with clear heights between 32-feet and 40-feet. All buildings will feature dock-high and ground-level loading with secured concrete truck courts. Each of the buildings are designed with varying depths and are divisible to accommodate multiple tenants. The project will be developed in two phases. Phase I groundbreaking is planned for November 2021, with completion and delivery anticipated by yearend 2022. This phase will include the first five buildings, totaling approximately 2.5 million square feet.
CapRock West 202 Logistics is located within the southeast quadrant of the I-10 Freeway and Loop 202, at the northeast corner of North 59th Avenue and West Van Buren Street. The project offers direct freeway access and is approximately seven miles to Downtown Phoenix, 12 miles to Phoenix Sky Harbor International Airport. It is within a 45-minute drive to most of the Phoenix MSA. The project is surrounded by institutional owners, and neighboring tenants include Amazon, Kroger, CVS, Target, Home Depot, Costco and many notable others.
In 2020, Maricopa County added 86,820 new residents, more than any other county in the country, according to the U.S. Census Bureau. Supported by this rapid population growth, strong economic fundamentals, a business-friendly environment, temperate climate and lack of available product throughout California’s major markets, Phoenix has emerged as a premier destination for Fortune 1000 companies looking to increase their inventory and distribution capacities. Phoenix’s geographic position, within a single-day’s drive to primary consumer markets and logistics hubs in Southern California, Dallas, Denver and Salt Lake City, has led it to become a critical node in the North American supply chain. Phoenix’s industrial market set a record of 12 million square feet in net absorption in the first half of 2021, after experiencing its highest level of absorption in history of 13 million square feet in all of 2020, according to Cushman & Wakefield.
“CapRock West 202 Logistics is coming online as Phoenix holds the spotlight as one of the most preferred cities in the U.S. from a lifestyle, employment and logistics standpoint; both businesses and individuals continue to relocate to the Valley in record-setting numbers,” said Jon Pharris, co-founder and president of CapRock Partners. “CapRock West 202 Logistics is an extraordinary development in terms of what it means for Phoenix as the city advances in becoming an even more influential and dynamic North American economic center. CapRock is committed to providing state-of-the-art large-scale warehouse solutions in key Western markets as corporations rapidly adjust their operations to meet the demands of today’s evolving economy.”
“CapRock West 202 Logistics is a critical project for CapRock Partners as one of the fastest growing industrial real estate firms in the West,” added Pharris. “Since 2020, CapRock has added approximately 3.7 million square feet of Phoenix-area industrial product to its investment, development and management portfolio, and CapRock West 202 Logistics brings the firm’s total pipeline in the Valley close to 7.5 million square feet. Our team is grateful for the opportunity to develop this unique and impactful project and contribute to Phoenix’s positive growth.”
Don MacWilliam and Payson MacWilliam of Colliers International represented CapRock Partners in the CapRock West 202 Logistics land transaction and will oversee the project’s leasing. CapRock West 202 Logistics’ development partners include CCA Architects and civil engineer Kimley Horn.
CapRock’s recent development portfolio includes approximately 16 million square feet of Class A logistics facilities across Arizona, Nevada and California that the company recently completed, is currently building or is about to commence. Inclusive of the CapRock West 202 Logistics development, CapRock plans to be under construction on upwards of five individual 1 million-square-foot industrial buildings in 2021 and 2022.
Beyond ground-up development, CapRock is actively acquiring middle market, value-add industrial assets, typically between $20 million to $50 million per acquisition. The firm recently announced the final close of its oversubscribed CapRock Partners Industrial Value-Add Fund III and is looking to acquire upwards of $1 billion of industrial assets for the value-add vehicle.
