PROPERTY, GROWTH AND LOCATION
Camelback Corridor Resurgence
STRONG MULTIFAMILY MARKET Greater Phoenix’s multifamily market continues its dynamic pace, according to a report released by Colliers International in Greater Phoenix. • During the first quarter of 2017, vacancy fell 40 basis points to 5.6 percent. This is welcome improvement for the beginning of the year, but the rate is 40 basis points higher than a year ago. • Rental rates rose further in the first quarter, reaching $949 per month. This is a 5.6 percent increase from one year ago. • Construction remains strong and is forecast to gain momentum in the upcoming quarters. Nearly 1,500 units came online in the first quarter, up from 800 units in the fourth quarter of 2016. • Investment activity in the multifamily sector slowed in the first quarter of 2017. Despite the downturn, transactions are still 30 percent higher than they were in the first quarter of last year.
Since the grand opening of the Arizona Biltmore Resort in February 1929, the area known as the “Camelback Corridor” hasn’t missed a development beat. Stretching along Camelback Road between 7th and 64th streets, the submarket long ago reached the “built out” stage, with virtually every infill site along the route developed into premier residential or commercial space. That makes the resurgence happening at Camelback Road and 28th Street notable. Anchored by the development of the Camelback Collective — a new mixed-use project on Camelback Road between 28th and 29th streets — this area is teeming with a kind of new construction buzz that’s rare for the corridor, a high-barrier-toentry submarket that boasts Class A office rents ranging from the mid-$30s to low $40s per square foot and vacancy rates that have dropped dramatically. Camelback Collective will replace two 1970s-era buildings with a new 120,000-square-foot Class A office building and a 160-room AC by Marriott hotel. Already under construction by LaPour Partners and Graycor Construction, the project represents the first new office building to be built on the Camelback Corridor in eight years. The Class A 2777 Camelback office building sits directly west of the Camelback Collective site, and is also riding the momentum of new development activity. Following a March purchase by Lincoln Property Company, the 104,618-square-foot building
is being repositioned with lobby and common area renovations, new lobby furniture, an indoor tenant lounge and conference facility, a new collaborative outdoor lounge area, new corridors and bathroom finishes, improved signage and upgraded landscape and hardscape. This will modernize the building for existing tenants and help to market a rare find on the corridor — approximately 37,000 square feet of available space, including a full second floor with a 28,000-square-foot floorplate. The last piece of the resurgence puzzle is a new five-story, 253-unit Santa Barbara-style luxury apartment community being developed directly west of 2777 Camelback by StreetLights Residential. The project sits on land previously hindered by receivership, but that is now under new ownership and represents a dynamic element of this booming Camelback Road intersection. Since 2012, the Camelback Corridor has recorded positive office space absorption of more than 214,000 square feet annually. The intersection of 28th Street and Camelback Road features walkability to more than a dozen restaurants and Biltmore Fashion Square, and is minutes from executive housing, State Route 51 and Sky Harbor International Airport. —David Krumwiede, executive vice president for Lincoln Property Company, an international full-service real estate firm offering real estate investment, development, design/construction management, leasing and property management/receivership/asset management services
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Relo Bay Area to Phoenix The Phoenix office of JLL has completed a new, 38,000-square-foot lease that will relocate FinTech company Upgrade Inc. from San Francisco into two floors at Renaissance Center I in Downtown Phoenix. The move is the latest example of a Silicon Valley company expanding its essential business functions in Phoenix. Upgrade is hiring 100 customer service, credit operations and collections professionals here, and expects to add an additional 200
by Mike Hunter
Lobby Renaissance Trending: Seniors Cypress Office Properties, LLC has Housing commenced construction on phase one of a $50 million renovation of Renaissance Square in Phoenix. The first phase includes upgrades to both buildings’ lobbies, each to have a different theme. Building One (pictured) will have a “tech” atmosphere. Building Two will have a warm hospitality feel with boutique-style interior finishes. Both lobbies will serve as places for tenants to work, collaborate, socialize, eat and drink. cypressoffice.com
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INBUSINESSMAG.COM
Memory Care, developed by Prevarian Senior Living, recently opened in Gilbert. A full complement of amenities makes it a self-contained social community, with private residences as well as an assisted living portion. It will also place a special emphasis on Memory Care, offering three distinct memory care neighborhoods, each catering to residents who are living with a different stage of Alzheimer’s
employees by the end of 2018.
disease and dementia. Seniors housing
jll.com/Phoenix/en-us
is a growth segment nationwide. savannahouseseniorliving.com
bit.ly/2017-gpmf
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Savanna House Assisted Living and
Q1 2017 marks the 14th consecutive quarter for rental rate increases in the Greater Phoenix area, and the 1.9-percent increase in the first three months of 2017 was the fastest growth in nearly a year.