CBRE arranged the sale of a 10,739-square-foot office property in Scottsdale to a private Northern California-based buyer for $5.7 million. The property sold at a $531 per square foot, which represents one of the highest office sales per square foot in state history.
Located at 20865 North 90th Place, the high-image property sits within the exclusive DC Ranch’s Market Street, a premier mixed-use neighborhood center in North Scottsdale. The building was designed and built by Salcito Homes in 2005 and is 100 percent leased to five financial services and real estate-focused tenants. The property, which features tall ceilings, hard wood floors, abundant natural light and private terraces, sits within minutes of the Loop 101 Freeway.
Smaller office buildings below 20,000 square feet continue to thrive and outperform larger office buildings in the region, according to CBRE research. Within a 5-mile radius, office vacancy is at 5.8 percent for office buildings between 5,000 square feet and 20,000 square feet. Scottsdale’s office leasing activity is up nearly threefold compared with last year as tenant demand continues to increase, according to CBRE research.
“At a record per-square-foot price, this sale is a perfect example of the strength of the Class A office market and the robust investor demand for Metro Phoenix in generally and Scottsdale in particular,” said Cornish. “With the nation’s leading population growth and a strong quality of life, Arizona continues to attract aggressive out-of-state capital looking for opportunities in growth markets like ours.”
Due to flight-to-quality, Class A office buildings in Scottsdale, Tempe, Chandler, and the Camelback Corridor remain the most competitive in the Phoenix Metro with significant rent appreciation occurring across these leading submarkets, according to CBRE research.
“With 94 percent of our buyers coming from outside Arizona and 97 percent of which are in a 1031-exchange, we continue to set pricing records, as was the case for this transaction,” said Turbow. “In fact, we have three other buildings in Scottsdale right now currently in escrow for over $500 per square foot.”