New owner touts quick turnaround for stalled Centerpoint towers
If the developers of Centerpoint towers get their way, by March hundreds of new residents will be living in downtown Tempe. The area will get its long-awaited grocery store. And developer Zaremba Group will have completed the first tower of a flagship property in the heart of a nationally-recognized university downtown.
The accomplishments, said Kent Chantung, director of development of Zaremba Group, will gain the company regional recognition for saving one of the Valley's most high-profile real-estate projects.
On Wednesday, Chantung and Zaremba's co-construction project managers Mike Soto and Nate Pile took Tempe business representatives on a tour of 22-story Tower 1.
The company's bid for the property was selected last week above hundreds of others. The sale is subject to approval from the U.S. Bankruptcy Court in Phoenix. Chantung hopes to have approval by early October and resume construction at that time.
The tour dispelled rumors that the towers, which stalled when financial backer Mortgages Ltd. went bankrupt, suffered extensive damage because of heat and vandalism.
"I came through here two years ago when there was still ongoing construction. It is still in perfect condition. I can see why they can open in March," said Nancy Hormann, president of Downtown Tempe Community Inc., which manages and markets downtown for area landowners.
Tower 1 units, which were near completion when the project stalled, need mostly cosmetic fixes and repairs to some warped cabinetry, Pile said.
Chantung said he could not disclose the company's financial backers but he described them as one of the "largest and longest-tenured pension funds in the country." Zaremba paid $30 million for Centerpoint and expects construction to complete the two towers, commercial space and a parking garage to cost less than $100 million.
Shifting the real-estate project from condos to rentals would allow Zaremba to make money off the project immediately, Chantung said. "We did a market study. The absorption rate would have put us at most with selling 1 1/2 units per week. At that rate, we wouldn't fill it for several years," he said.
Hormann acknowledged there are many critics of allowing the first all-rental project in the heart of downtown Tempe. But she reasoned Tempe's economy would benefit immediately from the infusion of renters.
"This is 400 people 24/7 in our downtown. And this is people with disposable income, because these units are not cheap. These are not dorms," she said.
The tour started from the bottom floor of Tower 1 where commercial or retail space is planned. Mary Ann Miller, Tempe Chamber of Commerce president, was among the business stakeholders who walked one-, two- and three-bedroom units and toured the seventh floor where a gym and five tanning rooms would open onto a rooftop with an outdoor pool, beach and cabana that would join the two towers. Thirty-story Tower 2, which is expected to be complete next summer, would house a game-and-recreation area and conference/study area that opened to the pool.
The last stop provided sky-high views of the Valley's mountain ranges, downtown Phoenix and Arizona State University from the tower's four-bedroom penthouse. The 7,400-square-foot unit on the tower's top floor included a balcony where a small pool was half built.
Soto, co-construction project manager, said the penthouse showcases Tempe's central Valley setting. Chantung stated Zaremba's goals for Centerpoint.
"After a number of years of this project being at a standstill, it is finally going to happen. We know the potential this project has. It will be a flagship property for us," he said.
Exiting the project, Miller said she is hopeful that completing the towers would trigger a shift in Tempe's economy.
"It's a really good sign of recovery," Miller said. Zaremba expects to resume construction with a team of at least 200 workers.
http://www.azcentral.com/business/reales...100909tempe-centerpoint-rentals0910.html
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