Mack Real Estate Group (MREG) announced that the initial phase of Mack Innovation Park Scottsdale is fully financed and breaking ground imminently. Affiliates of MREG have secured approximately $63 million of debt financing for construction of the two-building, 305,400 first phase of development on a well-located 124-acre infill site in North Scottsdale with capacity for 1.2 million square feet across 11 buildings and excellent access to Pima and Bell roads and the Loop 101 freeway. Bank OZK provided $43.0 million of first mortgage construction debt, and PGIM Real Estate provided $19.78 million of construction mezzanine financing. JLL Capital Markets arranged the financing.
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“The Scottsdale industrial market continues to see limited new supply and ongoing rent growth. Given these positive dynamics, we believe Mack Innovation Park Scottsdale will be well received,” said Richard Mack, CEO of MREG. “We’re excited to break ground on our first phase with the support of construction debt from Bank OZK and PGIM Real Estate. As a firm we remain bullish on Phoenix, with a large footprint of active projects across the Phoenix MSA.”
“Bank OZK is pleased to provide construction financing for this large-scale industrial development that will serve as a convenient, flexible and accessible distribution hub,” said Jason Choulochas, Managing Director of Originations at Bank OZK. “The Phoenix MSA continues to be an attractive market given its strong economic fundamentals.”
“PGIM Real Estate is proud to highlight our firm’s active and growing presence in the structured debt market through this deal,” said Daniel Kattan, executive director at PGIM Real Estate, who led the financing on the firm’s behalf. “As demand for industrial real estate remains robust, we are pleased to have a strong partner in Mack Real Estate and provide financing for the development of these institutional quality assets.”
The first phase of Mack Innovation Park Scottsdale consists of two state-of-the-art industrial buildings totaling 305,400 square feet. The buildings are to feature 32’ clear heights, 53 dock-high doors, 20 grade-level doors, and 516 parking stalls. The JLL Capital Markets team of Chris Peck, Brad Miner, Jason Carlos, Tyler Peck and Jarrod Howard arranged the financing package. The project team for Mack Innovation Park Scottsdale consists of Willmeng as general contractor; Butler Design Group as architect; and Withey Morris Baugh PLC as land use counsel. Leasing agents are Mitch Stravitz and Rusty Kennedy of CBRE, James Cohn of Stream Realty, and Randy Shell of Shell Commercial.
MREG is a real estate firm with a national development and investment footprint, including a large and rapidly growing presence in Phoenix. In addition to recently prevailing at auction for the right to develop a mix of uses across the 2,300-acre site in the North Valley surrounding Taiwan Semiconductor Manufacturing Corporation’s campus, MREG is currently building a total of over 4 million square feet of industrial space at Mack Innovation Park Deer Valley and Mack Innovation Park Scottsdale and owns an approximately 800,000 square foot warehouse property in Goodyear. Additionally, MREG’s multifamily portfolio in Phoenix consists of more than 900 units owned or under development, and the firm also owns a 198-unit community in Flagstaff.
