Colliers International in Greater Phoenix has released its Greater Scottsdale Airpark 2030 Report. The document highlights the most meaningful transactions in the area for 2017 and predictions for the submarket extending to 2030.
“This year we chose to focus a good portion of the report on elements that will NOT change in the Scottsdale Airpark,” says Jim Keeley, SIOR, CCIM and founding partner of the company’s Scottsdale office. “Much of the submarket’s success is derived from characteristics that will continue to fuel growth, such as the Loop 101 freeway and the popularity of the Scottsdale Airport.”
The report predicts that by 2030 the Scottsdale Airpark will be home to 4,000 businesses employing as many as 80,000 workers. The airpark is forecast to contain as much as 52 million square feet of commercial space by that time.
“The Scottsdale Airpark is a modern ‘Edge City’ as defined by author Joel Garreau,” says Keeley. “It is an employment base with mixed-use retail, offices, restaurants, apartments, condos, hotels and flex and light industrial space. These are all critical elements of an environment that appeals to the work-live-play focused millennial generation.”
In 2017, the Scottsdale Airpark featured a core of more than 40 million square feet of space at 57,000+ employees. Multifamily projects have become a new category in the submarket, where seven new projects have been built in the past 24 months. The area now features 29 apartment communities with more than 7,000 units.
During 2017, several noteworthy business additions and expansions occurred in the Scottsdale Airpark. Han Wei Lines, a Taiwan-based global shipping company, moved its US headquarters into Perimeter Center. Carlisle Company, a Fortune 1,000 global manufacturing company, moved its headquarters to Kierland from Charlotte, NC. Tesla is growing its presence in the Scottsdale Airpark as well.
“During 2018 we will likely experience announcements of two million-square-foot mixed-use developments. Additionally, the market will continue the much-needed redevelopment cycle of replacing 30-45-year-old obsolete buildings with new, modern properties,” says Keeley. “As these new mixed-use and tech projects come on line, we are struggling with a lack of available industrial space. Property values in the area have risen to such an extent that new industrial projects have simply been priced out of the mix. Unless rental rates significantly spike, we doubt any new industrial will be added. We will, however continue to see expansion of the ‘car collection enthusiasts’ who already have more than 40 different auto collections in warehouses, hangers and flex space in the area.” Colliers predicts the economy will remain resilient into 2020, which will fuel activity in the Scottsdale Airpark and surrounding commercial areas.