Lincoln Property Company’s Class AA Grand2 office building in Tempe, Arizona, has sold, becoming the largest office sale to close in the state this year and one of the top five office sales to close this year in the Southwestern U.S.
The sale price, which was reported to be $187.5 million, represents the largest office sale to close in Arizona this year and the fifth largest office sale of the year in the Southwest region.
The building buyer is Apex Capital Investments Corporation, a U.S.-based real estate investment management firm with a track record of core-plus, value-add and opportunistic investment strategies across asset classes. Grand2 represents the company’s first-ever Arizona office purchase.
Grand2 was completed in late 2019 by LPC Desert West, the Southwest regional office of Lincoln Property Company (LPC), in partnership with Goldman Sachs MBD Real Estate. Upon completion, Grand2 ranked as one of Arizona’s largest-ever purely speculative office buildings and was almost immediately leased by San Francisco-based, on-demand food platform DoorDash with a full-building, long-term commitment.
“Grand2 is a stand-out building across the board,” said Lincoln Property Company Senior Executive Vice President David Krumwiede. “Its amenities and location exceed the highest market standards, and it is stabilized by a full-building, long-term credit tenant that is exploding with growth, especially during the COVID-19 pandemic.”
Located at 1033 W. Roosevelt Way, Grand2 is the second building developed and sold by LPC Desert West – NAIOP Arizona’s 2018 and 2019 Owner and Developer of the Year – at The Grand at Papago Park Center, a 60-acre, mixed-use, freeway-fronting development.
CJ Osbrink from Newmark represented LPC in the sale of Grand2, in cooperation with Newmark’s Kevin Shannon, Ken White, Brunson Howard, Paul Jones and Rick Stumm. Apex Capital was self-represented.
“Lincoln Property and Goldman Sachs did an exceptional job executing the vision of this project and delivering a best-in-class office project to the market,” said Shannon. “This is a high-quality, low-risk asset that presents the buyer with steady cash flow in an extremely active, evolving market.”
The 9-story, 358,000-square-foot Grand2 building is designed for the most contemporary companies, featuring a 13,000-square-foot indoor/outdoor lobby and amenity lounge with a TV viewing area, collaborative spaces, conference facilities and an on-site fitness facility with Peloton and Mirror equipment.
Offices are accessed by a destination dispatch elevator system delivering passengers to their desired floor without interruption, and office suites feature flexible floorplates with 10’ to 14’ vision glass windows overlooking a massive Roosevelt Dam water feature, which pays tribute to the original Roosevelt Dam completed in 1911. The LEED Silver and Energy Star building is completed with subterranean and structured parking, and topped with a 13,000-square-foot rooftop deck featuring shaded seating, catering conveniences and sweeping views of Papago Buttes, Hole in the Rock and Camelback Mountain.
The building boasts approximately one-half-mile of frontage to the Loop 202 freeway, with monument signage offering exposure to more than 185,000 cars per day. It also provides immediate Metro Light Rail access via two on-site Light Rail stops, and is minutes from downtown Tempe, Arizona State University, Papago Park and Sky Harbor International Airport.
Grand2 is part of 1.8 million square feet slated for development by LPC at The Grand at Papago Park Center – a master plan that ultimately will total 3.2 million square feet of office, multifamily, hotel, retail and restaurant space located on the last developable parcel within the 350-acre Papago Park Center business park.
LPC’s adjacent Grand1 building was sold in late-2019 to Susquehanna Holdings Ltd. The 220,000-square-foot building is fully occupied by Tokyo-based MUFG and SAP. Future office buildings at The Grand at Papago Park Center are in the planning stages now by LPC Desert West.
DAVIS served as the architect at Grand2 and Whiting-Turner was the general contractor. LPC serves as the developer, leasing agent and property manager for all office space at The Grand, and will continue to serve as property manager for Grand2 following its sale.
To discuss leasing, investment or property management opportunities with Lincoln Property Company in the Desert West region, call David Krumwiede or John Orsak at (602) 912-8888.