In the News—Week of April 3, 2023
Deal of the Week
An Arizona based investment company refinanced a $34M Texas Apartment complex. The transaction was closed by Sheila Hunter, Vice President and Senior Commercial Escrow Officer, in our Scottsdale office.
Downtown blues: Back-to-office movement fails to materialize
The office buildings in urban centers devastated by COVID-19 have not enjoyed the expected rebound, NBC reports. Office real estate vacancies are 12.8%, the highest since the Great Recession. And some of the central business districts in the biggest cities, such as San Francisco and New York, are the hardest hit. Meanwhile, newer buildings and those in the suburbs are faring better. “Newer generations of workers are looking for something a bit more, something to entice them to come to the office,” says Tom LaSalvia, a senior economist at Moody’s analytics.
South Florida office market bucks the trend of other metro areas
As office markets around the country struggle, Miami is enjoying a boom, Commercial Observer reports. Asking rents in Miami have risen since 2021, surpassing $50 per square foot. At the end of 2022, Miami had the fourth-highest absorption rate in the country. The vacancy rate has dropped to 16.4% as new-to-market tenants sign leases. And developers are optimistic the trend will continue. Stephen Ross and partner Swire Properties plan to break ground this year on an 80-story office building in the financial district.
Colorado Coca-Cola bottler wants to build plant on Denver airport land
A Colorado Coca-Cola distributor is proposing to build a bottling plant on 97 acres of Denver International Airport land in a $271 million deal, The Denver Post reports. Swire Coca-Cola USA’s plant would replace the company’s production and sales centers. The land would be leased for 75 years, with the option to extend it up to 99 years. The city council is set to consider the lease agreement April 5. Swire plans to invest between $350-500 million in the project and create up to 200 new jobs, while the airport would provide up to $10 million for infrastructure work.
In LA, deals close fast in an effort to avoid the city’s ‘mansion tax’
With Los Angeles’ “mansion tax” going into effect April 1, property closings that usually took 30 days were completed in as little as three days, MarketWatch reports. Los Angeles previously had a 0.45% base tax rate on property sales, but the new law adds 4% on sales over $5 million and 5.5% on sales over $10 million. The tax affects commercial as well as residential. The money from tax will go to affordable housing and to assist tenants in danger of being evicted.
Stevens-Leinweber completes build-out of industrial space
Stevens-Leinweber Construction has completed the build out of 160,000 square feet at Phoenix Logistics Center Two, AZ Big Media reports. The space was designed for Georgia-Pacific LLC and its HP PageWide T1190 Press. The press expands Georgia-Pacific’s digital print solutions, making the company the only packaging supplier in North America to offer 110-inch wide web digital inkjet printing. The press is part of a larger Georgia-Pacific operation at PLC Two, which includes a printing production space, specialized storage space, and interior office and conference areas. PLC Two is the second building within Merit Partners’ Phoenix Logistics Center located at the southeast corner of 91st Avenue and Buckeye Road in Phoenix, within the Interstate 10 Corridor.
Phoenix ranks No. 3 among large U.S. cities for most vacant land
Phoenix has the third-most vacant land of any leading city in the United States, AZ Big Media reports. Figures from CommercialCafe show that Phoenix trails only Dallas and Fort Worth for vacant land among the 20 most populated cities. Phoenix has 53,022 acres of vacant land and is the only city outside Texas in the top five. Dallas has 90,739 acres of vacant land and Fort Worth has 74,835 acres. A majority of the undeveloped and vacant land in Phoenix is government-owned.