Phoenix Development News (3)

[TakeFive]

The vacancy rates in mid-town are more driven by tenants moving to new class A space more than any specific issues with parking I believe. When the recession hit concessions and move-in rates at 24th and Camelback (for example) were hard to beat. Isn't most vacancy in downtown also in older buildings as opposed to CityScape. Scottsdale Airpark also has significant vacany presumably from dated buildings more than from parking.

Mike Sunnucks, Phoenix Business Journal painted the reality yesterday in his headline:
"East beats West: All new office construction happening in East Valley, Scottsdale — none in West Valley, Phoenix"

Mike Sunnucks also had a mixed bag companion piece:
"Phoenix vacancies still high but larger office spaces harder to find"

The East Valley has taken most of the air of downtown's balloon. This not new info or a surprise but it is today's reality.

Some day in a future not that distant the wonderful new freeways will become once again a congested mess. Downtown Phoenix will have its day and time.

[ASUSunDevil]

Originally Posted by Obadno

http://azbex.com/mixed-use-project-to-central-phoenix/

So the third midsize apartment complex for 11tha and Washington....

Why this area? Its pretty much a shit neighborhood???

Affordable land and direct access to the Light Rail.

90 units isn't that substantial. It looks mediocre in design, but at least it includes some retail.

Even though these are decent, I have higher expectations for Downtown residential. The Denver midrise's that TakeFive posted yesterday are what I'd like to see Downtown.

[crwhiteinaz]

Originally Posted by Obadno

http://azbex.com/mixed-use-project-to-central-phoenix/

So the third midsize apartment complex for 11tha and Washington....

Why this area? Its pretty much a shit neighborhood???

What a crazy question?! This neighborhood 10 years ago was very shitty. But like other neighborhoods downtown, the whole point of development is to take these shitty neighborhoods and develop them into affordable, denser communities where people want to live. Your logic would have just left Roosevelt row as it is. Whether through gentrification (whether you like that or not) or infill on empty lots and abandoned buildings, the whole point is transforming shitty into liveable.

This neighborhood is prime for development. These buildings sit right between the east/west LRT lines. It just sits right on the border of the edge of downtown (7th street). Imagine 10 years from now if the areas between Van Buren to north and Jefferson to the south and from 7th street east to the I-10 are filled with low-rise dense single and multi-use housing. Imagine an affordable area close to DT, with the prime access to LRT.. This could pan out for a very non-shitty neighborhood.

BTW... since LRT, this corridor has been pushed aggressively by the city for development. Former Mayor Gordon' "Opportunity Corridor" does have a long, long way to go esp since its neglect during the recession. These three buildings are good signs that it isn't dead.

Some archive reads ... http://archive.azcentral.com/arizona...ngton1020.html

[Obadno]

Originally Posted by crwhiteinaz

What a crazy question?! This neighborhood 10 years ago was very shitty. But like other neighborhoods downtown, the whole point of development is to take these shitty neighborhoods and develop them into affordable, denser communities where people want to live. Your logic would have just left Roosevelt row as it is. Whether through gentrification (whether you like that or not) or infill on empty lots and abandoned buildings, the whole point is transforming shitty into liveable.

This neighborhood is prime for development. These buildings sit right between the east/west LRT lines. It just sits right on the border of the edge of downtown (7th street). Imagine 10 years from now if the areas between Van Buren to north and Jefferson to the south and from 7th street east to the I-10 are filled with low-rise dense single and multi-use housing. Imagine an affordable area close to DT, with the prime access to LRT.. This could pan out for a very non-shitty neighborhood.

BTW... since LRT, this corridor has been pushed aggressively by the city for development.

I suppose I just meant that im surprised these lots along 11th were developed before the area around Roosevelt Point.

[TakeFive]

Originally Posted by dtnphx

Parking ratio's for an office building at over 3 per thousand is average. There are very, very few properties that offer over 5-6 per thousand parking and those are used for back office type uses. Many suburban corporate campuses will have 5-6 per thousand, but 7, no.

That's good info. I have little idea about such things, especially in Phoenix.

It all relates to how companies want to allocate square feet per employee. I originally read about it at the Puget Sound Business Journal where they were writing about the new trend of closer to 350 SF per employee as oppose the the traditional 500 SF per employee. They were speculating partly because of Seattle's own tech growth and specifically Amazon who is looking to build/occupy up to 10 million square feet by the end of the decade. There wasn't any specific examples of buildings or how much parking they had or were planning however.

It's also why I think Phoenix should work to improve not only their transit but streetscapes that connect neighborhoods. Make downtown more attractive as a place to live as well as work and the rest should take care of itself.

Originally Posted by Obadno

http://azbex.com/mixed-use-project-to-central-phoenix/
So the third midsize apartment complex for 11tha and Washington....

Why this area? Its pretty much a shit neighborhood???

An ideal place to TOD cluster? Works for me.

[ASU Diablo]

Well this is one way to help lower the office vacancy rate...more foot traffic in midtown area.

Exclusive: Class A office building at Central and Camelback could be converted to apartments
Mike Sunnucks
Phoenix Business Journal
http://www.bizjournals.com/phoenix/n...ntral-and.html

An 11-story Class A office building at Central Avenue and Camelback Road in Phoenix could be developed into apartments.

The owner of the 203,100-square-foot building — One Camelback Inc. — is talking to Scottsdale-based apartment developer P.B. Bell Cos. about the possible conversion, said Paul Berkowitz, an attorney with the Greenberg Traurig PA in Miami who represents the owners of the building.

“It is not finalized,” Berkowitz said.

Berkowitz said the building’s owner and property managers are keeping office tenants briefed on the possible deal and conversion.

Current tenants include BMO Harris Bank as well as a number of law firms, accountants and staffing firms. The building was built in 1985. It is currently 44 percent vacant.

P.B. Bell Marketing Director Kira Brown declined comment.

The Scottsdale company is one of the leading apartment developers in the Phoenix market.

“Right now, we are focusing on new projects underway at 16th and Highland, Escape Luxury Apartments, the 101 and Scottsdale Road, The View at Cascade, and Velaire at Aspera in Glendale,” Brown said.

P.B. Bell is also part of a development of the Barrister Building in downtown Phoenix along with Davis Enterprises LLC.

Berkovwitz and others familiar with the possible One Camelback conversion acknowledge the possible deal is a poorly kept secret in local real estate circles.

He also notes the possible conversion coincides with renovations of the Uptown Plaza shopping center across the street. The center include an AJ’s Fine Foods. One Camelback is also on the Metro light rail line and is near Upward Projects restaurants a few blocks north on Central Avenue.

The midtown Phoenix area already has an oversupply of office space with a 28 percent vacancy rate, according to first quarter numbers from Cushman & Wakefield Inc.

Greenberg Traurig attorneys are listed as the corporate managers for One Camelback Inc. on Arizona Corporation Commission filings. Berkowitz said the Miami-based law firm, however, does not own the property, Instead, it’s owned by an entity called Zell Holdings. He said that group is not affiliated with well-known Chicago developer Sam Zell.

[TakeFive]

To funny not to post. I just have to go to today's Phoenix Business Journal where Francine Hardaway gives me the inside scoop on Colorado.

"Get ready for the marijuana industry in Arizona"

Last year, the first full year of legal recreational marijuana in Colorado, the industry’s revenues logged $600 to $700 million.

That kind of money can’t be ignored by state officials in Arizona, which already has a medical marijuana industry and a big state tax deficit.

As you might guess, this has spawned an ecosystem of startups and entrepreneurial ventures to serve the industry.

LOL, I did do a brief post concerning Denver's 4/20 event which basically stated that hotel reservations were up 60% over last year.

Don't follow this much; all I know is that the near downtown warehouse market which was rather drab from dated buildings quickly became a hot ticket. Presumably this is a "millennial friendly" thing but I couldn't say how much this is contributing to downtown's popularity.

[PHXFlyer11]

Originally Posted by airomero83

Well this is one way to help lower the office vacancies rate...more foot traffic in midtown area.

Exclusive: Class A office building at Central and Camelback could be converted to apartments
Mike Sunnucks
Phoenix Business Journal
http://www.bizjournals.com/phoenix/n...ntral-and.html

Just read this as well. Good news! There are so many great restaurants in that immediate area with St. Francis, Federal Pizza, Joyride, etc and the Uptown Plaza renovation will be great.

The existing offices will have to move elsewhere nearby, further decreasing the vacancy rate. I hope this happens. Really loving what I'm seeing out of midtown lately.

[ASU Diablo]

Looks like more retail coming to Skyline Lofts...The Fratella Sausage Co. and Growler Fill. A sausage and beer restaurant with an outside bocce ball court. Nice!

http://www.azcentral.com/story/enter...mmer/26097425/

[exit2lef]

Originally Posted by airomero83

Looks like more retail coming to Skyline Lofts...The Fratella Sausage Co. and Growler Fill. A sausage and beer restaurant with an outside bocce ball court. Nice!

I'm happy just to see any retail at all in Skyline Lofts, but this does sounds like a good place.

[biggus diggus]

Originally Posted by airomero83

Well this is one way to help lower the office vacancy rate...more foot traffic in midtown area.

A friend is a commercial broker and was telling me about this on Saturday. I didn't believe him, and I still don't feel confident it will come to fruition, but it would be neat if it does. He said he was working with BMO to find new offices, so it does sound real that they are moving...

[TakeFive]

Originally Posted by PHXFlyer11

Just read this as well. Good news! There are so many great restaurants in that immediate area with St. Francis, Federal Pizza, Joyride, etc and the Uptown Plaza renovation will be great.

The existing offices will have to move elsewhere nearby, further decreasing the vacancy rate. I hope this happens. Really loving what I'm seeing out of midtown lately.

We had a very nice Mother's Day brunch at St. Francis. My (now) 21 year old thought it was great. He also loves Postino.

Anyway, with respect to mid-town, I've been waiting and wondering....
Denver has had great success with several dated office building that were converted to apartments or a hotel. One taller building was converted to a Kimpton Hotel and apartments.

[PHXFlyer11]

There are two projects off of 3rd St. that I haven't seen mentioned. One is just south of Osborn. Not sure if it's medical offices or retail/restaurant. Nice new metal buildings.

The other is closer to McDowell, it looks like there is a concrete elevator shaft that is 4 stories up now. Definitely apartments.

Finally, an old office building on Third and about Thomas was gutted. Only the frame remains. Looks like a remodel. MAYBE a condo conversion? Not sure.

[HooverDam]

Originally Posted by TakeFive

The vacancy rates in mid-town are more driven by tenants moving to new class A space more than any specific issues with parking I believe.

Agreed. I've never heard and out of market tenant look at midtown parking ratios and say they're too low*, what I have heard is local brokers repeating "oh there's no parking in midtown." Which of course, is utter nonsense. However, most people, especially commercial real estate brokers, aren't particularly smart, creative, insightful or well read. They hear someone say "there's a parking issue" and they parrot it, they read one headline that says that, and they go with it.

The buildings in midtown are class B and C space mostly. That's the issue. We've failed to grow the type of economy that requires high rise office space, thus we play continual musical chairs between the Class A buildings, and the Class B and C structures mostly lay fallow.


*that doesn't mean this doesn't happen, I just haven't heard it.

[HooverDam]

Originally Posted by airomero83

Well this is one way to help lower the office vacancy rate...more foot traffic in midtown area.

Exclusive: Class A office building at Central and Camelback could be converted to apartments
Mike Sunnucks
Phoenix Business Journal
http://www.bizjournals.com/phoenix/n...ntral-and.html

This is good news. Two thoughts:

1. Lets hope the current tenants, especially BMO Harris stay in the Central Ave/lightrail corridor and we don't lose them to Scottsdale or wherever.

2. As the property re-develops I hope they can work out w/ Valley Metro to abandon the old drive through ATM area just south of the tower. If Light Rail is ever going to go East or Northeast, it would likely need to turn at an angle there, like it does going Northwest bound.

Though maybe it can make the right turn right onto Camelback. It seems able to make those tuns downtown, so maybe it would be fine.

[PHX31]

Originally Posted by PHXFlyer11

There are two projects off of 3rd St. that I haven't seen mentioned. One is just south of Osborn. Not sure if it's medical offices or retail/restaurant. Nice new metal buildings.

The other is closer to McDowell, it looks like there is a concrete elevator shaft that is 4 stories up now. Definitely apartments.

Finally, an old office building on Third and about Thomas was gutted. Only the frame remains. Looks like a remodel. MAYBE a condo conversion? Not sure.

The first one is located on a lot where they recently tore down a relatively non-descript MCM building. The new buildings look pretty decent, but it's almost like a commune/complex, it's a little scattered about on the lot. Probably just going to have a huge parking lot in the center.

The second one is the Native American Connections development on Virginia/3rd Street. We have talked about it before. http://www.nativeconnections.org/hou...er-development

The third one you mention was new to me too. I just saw the shell last week and was wondering what was going on.

[biggus diggus]

Originally Posted by HooverDam

They hear someone say "there's a parking issue" and they parrot it, they read one headline that says that, and they go with it.

This is not exclusive to any one group of people or profession, rather it is human behavior in general.

[pbenjamin]

Originally Posted by HooverDam

This is good news. Two thoughts:

1. Lets hope the current tenants, especially BMO Harris stay in the Central Ave/lightrail corridor and we don't lose them to Scottsdale or wherever.

2. As the property re-develops I hope they can work out w/ Valley Metro to abandon the old drive through ATM area just south of the tower. If Light Rail is ever going to go East or Northeast, it would likely need to turn at an angle there, like it does going Northwest bound.

Though maybe it can make the right turn right onto Camelback. It seems able to make those tuns downtown, so maybe it would be fine.

And at 19th Ave/Camelback which comparable.

[dtnphx]

Let's hope the BMO building conversion creates an interest for the SW Corner by the light rail station. Another condo building with ground floor retail would be nice. The entity that owns it is Cornerstone at Camelback LLC.

[Obadno]

Originally Posted by HooverDam

This is good news. Two thoughts:

1. Lets hope the current tenants, especially BMO Harris stay in the Central Ave/lightrail corridor and we don't lose them to Scottsdale or wherever.

2. As the property re-develops I hope they can work out w/ Valley Metro to abandon the old drive through ATM area just south of the tower. If Light Rail is ever going to go East or Northeast, it would likely need to turn at an angle there, like it does going Northwest bound.

Though maybe it can make the right turn right onto Camelback. It seems able to make those tuns downtown, so maybe it would be fine.

I don't now BMO's company culture you'd hope they would stay within a few miles for there employees sake and all the available space in buildings nearby.

But I wouldn't be surprised if they moved to some shiny new office off price or the Chandler Airpark.