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Even at a sub-6% cap rate, Go Daddy founder Bob Parsons is impressed with a Tempe mixed-use project. (We should've seen this coming when somebody registered the website: BobGonnaBuyTempeMixedUse.com)  Via his YAM Capital real estate investment firm, Bob just picked up Hayden Station, a 108k SF mixed-use office project at Mill Avenue and 3rd Street for $26.5M from Holualoa Cos. At nearly $246.50/SF, that puts the investment at a 5.6% cap rate, says Cassidy Turley's Steve Lindley, part of a massive CT team that brokered the sale, including Bob Buckley, Tracy Cartledge, Jeff Hartland, Scott Boardman, Trevor Klinkhamer, and Brent Mallonee.  Hayden Station is part of a five-building complex from the '80s formerly known as Hayden Square. (Prince isn't the only one from the '80s changing names.) It was nearly fully leased at the time of purchase. It's also adjacent to the Light Rail station and within a walk to ASU. |
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Cassidy Turly Talks Condos, Office Speaking of Cassidy Turley, members of the Phoenix office tell us all multifamily eyes are on condos right now. David Fogler cites Deco Community's plans for a surge in condo projects, including Envy in Scottsdale (pictured here). So far there are 23,000 apartment units in the pipeline for Metro Phoenix spread over a three- to five-year build-out, “which matches perfectly what we did from '03 to '07.” The difference: Developers are chasing high rents. At the peak of the housing market, ownership rates here were 70%. Now it's back down to 65%, David says. “We're seeing a lot of people renting by choice. That's why developers are trying to build this new high-end stuff.”  Land, on the other hand, has cooled somewhat in the past year as new housing permits dropped in Metro Phoenix, says Brent Moser (with wife Jen and kids Savannah, Mason and Madison). Current permits are around 14,000, which is low by historical norms. “I think a lot of locals are waiting for it to hit 20,000 for psychological reasons,” Brent says. But the right parcel will command a lot of interest—and capital—from housing developers. Brent says he's working on a $17M deal in Downtown Tempe that is only two and a half acres. “That's being driven by State Farm building 2M SF of space,” he says. “This particular deal in Tempe will benefit from the freeways… and light rail right behind it.”  When it comes to office, absorption has returned to pre-recession levels, “but a lot of that is driven by build-to-suit activity,” says Michael Beall (here with wife Kim, and kids Max and Cameron). “We're kind of chewing away at the vacancy.” At it's peak, vacancies for Phoenix office landlords nearly topped 27%; today it's hovering above 23%. And rent growth is only just happening in the most choice properties in the prime of submarkets.  Cassidy Turley is tracking 7M SF of industrial deals—the bulk of which is focused on the East Valley, says Will Strong (here inspecting The Great Wall of China—for a pending sale?). That's leading to rent growth for a change: “There's just not nearly enough [space] for the deals that are out there.” Most recently, Will helped sell a $13M distribution center to Exeter called Prologis Riverside Distribution Center. |
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ICSC: Booth Bonanza |
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 Bisnow was on the ground in Vegas at ICSC RECon this week, and in between talking to retail experts, we checked out the floor's biggest (and coolest) booths. To fit in as many dealmakers as possible, most of the big brokerages like Cushman & Wakefield (to the left), CBRE, JLL, and Newmark Grubb Knight Frank offered massive open-air setups. Big-time owners like GGP and Acadia Realty Trust, shown here, are going for a more enclosed, private feel. Over at the Cushman booth, the firm's Americas retail head Matt Winn told us placemaking is a popular topic among brokers and owners alike this year, and he says it's not just about sprucing up old shopping centers anymore; to survive, retail owners need to curate a healthy mix of hip local as well as tried-and-true national retailers. |
 Firms on the floor are all about placemaking too—especially in their own booths. Atlanta-based Jamestown went all out to welcome its guests with an exotic Indian-style tent, complete with a crepe station operated by Peter Tondreau and Troi Lughod of NYC's Bar Suzette (pictured hard at work in the back). Peter and Troi, whose Bar Suzette concept is a tenant in Jamestown's Chelsea Market, tell us they served 300 to 500 crepes every day of the conference. |
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Phoenix Power NetworkingWhat goes perfect with drinks and hors d'oeuvres? How 'bout some of the best networking opportunities in the biz. You're invited to join us for our first-ever Phoenix Power Networking event, starting 5:30pm Wednesday, June 18 at the Omni Montelucia Scottsdale hotel (tickets and info here). Join BURY and Artemis Realty Capital for free food, free drinks and lots of chit-chat on Phoenix commercial real estate. |
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