In the News—Week of July 24, 2023
Deal of the Week
An Arizona based land developer acquired agricultural land in Buckeye for $23.95 million for Industrial Development. The transaction was closed by Bryan Selna, Vice President and Senior Escrow Officer in the Scottsdale office.
So far, the experts have been wrong: No crash for commercial real estate
The commercial real estate experts haven’t been shy: With office vacancy rates nationally at a record high, rising interest rates, and highly publicized bank failures, the ingredients for a full-on CRE crash seemed all there. But, Forbes.com reports, that hasn’t happened. Now the experts have changed their tune slightly. A crash is less likely, and the commercial real estate sector is more apt to endure a long slide. There is even one statistic that is cause for optimism. Figures from JLL show that asking rents for office properties rose nationally by 0.3% from late 2022 to the first quarter of 2023.
Seattle mayor shares his vision for downtown of the future
Seattle Mayor Bruce Harrell officially unveiled his plan to revitalize the city’s downtown, GeekWire reports. There’s even a website, “Downtown Is You.” The mayor’s office wants to “stabilize and transform downtown into a place where residents, workers, and visitors want to spend time.” The plan comes after figures show pedestrian traffic in downtown is up 38.7% from a year ago. That is largely because thousands of Amazon workers returned to the area; the company is now requiring employees to come to the office at least three times a week. The foot traffic is still well below the level from before the pandemic and the civil unrest in the area in 2020.
Chicago mayor mulls mansion tax similar to one adopted by Los Angeles
Chicago’s new mayor is hinting at tripling the transfer taxes on property sales of more than $1 million, CoStar news reports. Brandon Johnson, who was elected in April, released a 233-page report on options for addressing racial and economic disparities. The real estate tax would be modeled after Los Angeles’ tax on property sales of at least $5 million. The city is to use the money to address the city’s homeless problem. So far, the money from the tax has fallen short of its backers’ projection. Chicago already has the second-highest commercial property taxes nationally, behind only Detroit, according to the city’s BOMA/Chicago trade association.
Miami gives approval for plans to redevelop James L. Knight Center
Hyatt and Gencom received the OK from the Miami City Commission to replace the James L. Knight Center on the Miami River, The Real Deal reports. Named Miami Riverbridge, the mixed-use, $1.7 billion, 3.3-million-square-feet project will be located on 4 acres owned by the city. Riverbridge will include two 61-story towers and offer a Hyatt Regency hotel and apartments. Voters had already approved the project, but Chicago-based Hyatt and developer Gencom still needed to negotiate with the city.
Fiesta Mall, once retail ‘gem’ of East Valley, is being demolished
Fiesta Mall, which opened in the late 1970s and was the eastern suburbs’ answer to Metrocenter in west Phoenix, is being torn down, the Mesa Independent reports. Owner Verde Investments has not completed plans for what will replace the mall on the 80-acre site. It could include up to 4,000 apartments. “For a long time, Fiesta Mall was a gem in the East Valley, which makes today bittersweet,” says David Leibowitz, a spokesman for Verde. “Though it’s early in terms of what comes next, we know this much for certain: We cannot wait to envision and build a new gem for the Valley, a high-quality development that combines multifamily housing and a range of commercial options at one of the best locations in metro Phoenix.”
Project that will include 5-star hotel is planned near Scottsdale Airpark
The site of the former CrackerJax amusement park is now being replaced by a project that its developer call “a once in a generation opportunity,” the Scottsdale Progress reports. Owners George Kurtz and David Megdal submitted a more modest plan in September for developing the project, called the Parque. They recently submitted a new plan. The updated plan calls for a five-star hotel and 1,200 apartments. “The Parque will be a walk-friendly community with architecture that caters to the pedestrian by providing visual interest and a series of shaded corridors and a strong visual presence of open space along Scottsdale Road with views into the site and beyond,” the developers say.