Market Fundamentals Driving Out-of-State Investors
We chatted with JLL's Dennis Desmond fresh from his sale of Camelback Arboleda, a 179k SF office building on 16th Street in the Camelback Corridor. Minnesota-based Merced Restart Phoenix Investors I LLC purchased the facility for nearly $25M, which Dennis brokered along with colleague Brian Ackerman. While 79% leased and clearly a value-add play, Dennis says the buyer is eyeing more investment here because of improving fundamentals. There are pockets like Tempe, Chandler, and the Camelback Corridor that are very strong, Dennis says. “Investors are beginning to see that the worst of times are over in Phoenix.” (Come on out of the fallout bunkers, folks.)
Landlords, on the other hand, are getting encouraged to sell because of escalating pricing. Especially if the owner bought the property right before the crash, they're now seeing that they can recoup costs—or even make more in some cases—despite little or no additional leasing in the meantime, he says. His team is chasing some 750k SF of office to take to market, including the recently listed Chandler Corporate Center I (above).
