CBRE, Cushman & Wakefield, and Fenix Development, a Los Angeles-based real estate investment and development company, announced today the 265,000 square feet of Class A office and 44,000 square feet of high-end restaurant and retail space slated for Phase I of the 1.9 million-square-foot The Watermark | Tempe mixed-use development, will be built on spec. Fenix Development is scheduled to deliver Phase I of the project in summer 2019. Two levels of subterranean parking and the site’s utilities are already in place.
Once completed, the 15-story office building will feature eight levels of premium office space above a seven-level podium-style parking structure. An eighth-floor Sky Lobby elevated 90 feet above grade level will be outfitted with a Sky Terrace, Sky Balcony and high-end tenant amenities, including a 40-person conference center, lounge, game room and fitness center with a cycle studio and showers. With floor-to-ceiling wrap around glass, all floors will boast unobstructed views of Tempe Town Lake, Marina Heights and surrounding mountains. The building will also include 18,250 square feet of ground-level restaurant and retail space surrounding a family-friendly splash pad feature.
A second building that is also set to deliver summer 2019, will have an additional 25,565 square feet of street-level restaurant and retail space and a seven-level parking garage. An elevated Sky Walk will connect the two buildings, offering easy accessibility from the adjacent parking structure to the eighth floor Sky Lobby. Phase I will also include 360 luxury apartment units by Trinsic Residential.
“Our vision behind The Watermark was to create a pedestrian-friendly environment that creates a central gathering place within the community,” said Fenix Development’s Mike Loretz. “Our focus was to raise the bar in Tempe and create a development unseen and unmatched in the Phoenix market. This is a legacy project for us, and therefore was designed to be built to a much higher standard. Our location, features, finishes, and attention to detail are what sets this legacy project apart from our competition. Our commitment to this development underscores our confidence in Tempe’s prolonged growth and success.”
“With a unique position on Tempe’s north shore away from the congestion of downtown Tempe, access to a full diamond interchange at the Loop 202, access to the light rail and proximity to Sky Harbor International Airport, The Watermark Tempe easily has one of the most coveted addresses in the country,” said CBRE’s Brad Anderson.
Tempe continues to lead all submarkets across metro Phoenix, finishing the first quarter of 2018 with 178,473 square feet of positive net absorption and the lowest vacancy rate in the metro at 4.7 percent, according to CBRE Research. Class A vacancy sat at 1.55 percent in Tempe at quarter-end.
“Access to talent, affordability and business friendliness, among other factors, have contributed to Tempe’s emergence as a powerhouse submarket in recent years,” said CBRE’s Anderson. “Tempe’s Class A vacancy is hovering around just one-and-a-half percent and the demand for premium, quality office space in the submarket is only going to grow. The Watermark Tempe will fuel Tempe with the Class A speculative office space needed to attract top-quality tenants with immediate space needs. It will take Tempe to new heights.”
“We appreciate the vision Fenix Development has put in place for The Watermark Tempe,” said Tempe Mayor Mark Mitchell. “It is clear from their development design that they understand Tempe is unique, innovative and community-centric. I have no doubt that companies looking to expand or relocate will love this space and that the city and region will benefit greatly from the high-wage, high-quality jobs being brought in.”
An additional 340,000 square feet of Class A office space and a 250-room full-service hotel are planned for Phase II of The Watermark | Tempe.
CBRE’s Brad Anderson, Michael Strittmatter and Lauren Anderson are exclusively marketing the office space for lease on behalf of Fenix Development. Cushman & Wakefield’s Brent Mallonee and Golden St. John are exclusively marketing the retail and restaurant space.