Trendsetters

Valley Firms win IAA Award

A design/build collaboration between Haydon Building Corp and Richärd Kennedy Architects has earned the Valley firms a prestigious 2021 International Architectural Award for their work on the Asante Library in Surprise.

The International Architecture Awards are dedicated to the recognition of excellence in architecture and urbanism from a global point of view. The program pays tribute to new developments in design and underscores the directions and understanding of current cuttingedge processes consistent with today’s design thinking.

The $4.5 million 10,000-square-foot single-story branch library includes multiple study rooms; designated children’s, teens’ and adults’ reading rooms; a multipurpose maker space; and administrative areas. It is built on a 5-foot-high plinth that extends into the park to reduce site disturbance and developmental impact on retention basin capacity, folded perforated steel baffles cloak the exterior and create a dynamic facade with filtered sunlight, shadow play and an artistic representation of a tree canopy in the park.

Back in 1971, the Fiesta Bowl’s nine founders worked to secure an Arizona-based college football bowl game to enhance the stature of the state and draw tourism and population growth. Today, the PlayStation Fiesta Bowl, taking place Jan. 1, 2022, is one of the elite college football postseason games. Here is a look at some of the volunteers in the commercial real estate world who are active in making the game happen. In addition, each champions a nonprofit that has received support as a result of the Bowl’s success. — Alison Bailin Batz

Industrial Gains Continue

The Greater Phoenix industrial real estate market set several records during third quarter 2021, according to Colliers in Arizona’s 21Q3 Industrial Report.

At the end of the third quarter, there were 20 million square feet under construction, setting yet another high point for the market. Two single transactions greater than $100 million were posted, bringing year-to-date investment sales to $2.6 billion, and the median price per square foot has jump nearly 20% year-over-year. The industrial market is showing no signs of slowing down and will finish the year with more than 20 million square feet of positive net absorption.

Market Highlights

VACANCY RATE

5.20%

UNDER CONSTRUCTION 20 MSF

NET ABSORPTION 7.3 MSF

OVERALL ASKING LEASE RATES (TRIPLE-NET)

$0.66/SF

Bowl Builders:

CRE community steps up in support of Fiesta Bowl

Kirk McClure, senior client solutions manager at JE Dunn

Active since: 2015 Current role: Fiesta Bowl lead sales commissioner, team liaison Nonprofit: Fighter Country Foundation & Partnership

Bob Hart, president of the western division of AECOM Hunt

Active since: 2006 Nonprofit: Fiesta Bowl committee Nonprofit: Miracle League of Arizona

Troy Hoberg, first vice president of project development at AECOM Hunt

Active since: 2006 Current role: Fiesta Bowl committee Nonprofit: Homeward Bound

Justin Naber, West Coast vice president of L. Keeley Construction

Active since: 2018 Current role: Chair of the Par 3 Challenge Nonprofit: HopeKids

Brian Gubernick, chief real estate officer at Homeward

Active since: 2020 Current role: Fiesta Bowl committee Nonprofit: Junior Achievement of Arizona

Preserving Arizona’s Water Supply

Renowned Valley architecture firm Jones Studio offers a peek into its latest project: The Environmental Learning Center in Lake Havasu City. In the works for more than a decade following the city’s acquisition of 280 acres of federally managed land for public use, the center will serve as a solution to the water quality responsibility on the Colorado River — an issue that affects everyone in Arizona. The 15,000-square-foot center will be part of an 80-acre campus and include laboratories, a testing facility, meeting spaces and galleries that will provide education to students and professionals, and advance research opportunities for a range of agencies, as well as serve the community.

Office Market Grows Despite Setback

The Greater Phoenix office market posted a negative net absorption of 721,349 square feet during the third quarter of 2021, marking the second lowest quarter since the beginning of the pandemic and second lowest in the past five years. This was due in large part to JPMorgan Chase’s move out of downtown Phoenix, according to Colliers of America’s 21Q3 Office Report. Despite absorption problems, the market benefited from investment sales and an uptick in rental rates

Additional key takeaways from the report include:

• Rental rates have gained positive momentum after declining the past two quarters, ending at $27.76/ square foot. • Investment sales were the darling of the quarter, posting the second highest quarter of total volume in the past three years at $858 million • Three projects totaling 228,934 square feet were delivered with high vacancy of 74.9%. • There are 16 projects currently under construction totaling 1,894,795 square feet, with 28.44% of the space pre-leased.

Facebook launches construction job training program

Construction has been booming in Arizona for the past few years. To help the industry meet labor needs, Facebook recently launched a nationwide construction job-training program, dubbed “Hardhat in Hand,” at its data center construction sites across the country — including the planned $800 million 960,000-square-foot facility in Mesa.

The eight-week training program is designed to prepare students for entry-level careers in construction, including carpentry, electrical, concrete and more, and to create a diverse pipeline of workers that is needed not only for construction of the data center but also other projects throughout Greater Phoenix.

Facebook is partnering with DPR Construction, the general contractor on the data center project, to build out the program and staffing.

FACEBOOK: Mesa data center

Data Center Demand Continues to Grow

Phoenix ranks No. 3 in the U.S. for new data center construction and No. 3 in the U.S. for data center absorption, according to JLL’s H1 2021 Data Center Outlook.

SUPPLY

Existing inventory is tight and new construction is underway. 50 MW of available data center space exists or is under construction to satisfy insatiable demand. NTT in East Mesa and Vantage Data Centers in Goodyear have both broke ground and will be delivering new capacity in the first half of 2022

DEMAND

Institutional investors target Phoenix data centers and development sites. Recent land sales are reducing available options and increasing price per acre. Recent demand for acquisitions of data center properties have compressed cap rates. Data center and industrial land prices have increased as much as 20%-40% in the last six to 12 months.

SUPPLY

SF MW Total inventory: 2,184,076 326.7 Total vacant: 371,536 31.1 Under construction: – 32.0 Planned: 959,897 250.0

DEMAND

WM Net absorption: 26.0

London Bridge celebrates 50 years in Arizona

For five decades, the London Bridge has served as a main attraction in Lake Havasu City, but this famous stone structure originally spanned the River Thames in England. Built in the 1830s, by 1967 it could no longer bare the weight of 20th century automobile traffic, so it was put up for auction. Lake Havasu City founder Robert P. McCulloch purchased the bridge in 1968 for $2.4 million — making it the largest antique ever sold. He intended to make it a centerpiece of his new city to attract potential land buyers to the area.

The bridge was dismantled in England, and each stone was numbered for reassembly. The structure was shipped in pieces through the Panama Canal and up the coast of California to the Port of Long Beach. It was then transported overland to Lake Havasu City, where reassembly began in 1968. Tempe-based Sundt was brought on to build the bridge over Lake Havasu’s Bridgewater Channel.

During reassembly, a steel framework was faced in granite, rather than using solid granite blocks, which reduced the weight of the bridge from 130,000 tons to 30,000 tons while strengthening the entire structure. Construction was completed in 1971; the cost for shipping and reconstruction, as well as dredging of a man-made channel underneath, cost $7 million.

Today, the London Bridge is the No. 2 tourist attraction in Arizona, second only to the Grand Canyon. It inspired a city that is currently home to more than 57,000 residents and hosts more than a million visitors per year.

Advertising just got a little easier for contractors. For years, Arizona law required licensed contractors to display their Arizona Registrar of Contractors (ROC) license number on “all broadcast, published, internet or billboard advertising, letterheads and other documents used by the licensee to correspond with the licensee’s customers or potential customers.” In March, Gov. Doug Ducey signed into law H.B. 2545, which took effect Sept. 29 and provides an exception to the long-standing requirement. Specifically, licensed contractors are excused from displaying or mentioning their license number on broadcast, internet or billboard advertising (including vehicle signage) if the ad includes a web address that “prominently displays the licensee’s name and license number.”