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Lack of supply and continued demand support project’s strategic delivery timeline
PHOENIX, September 13, 2012 – The Phoenix office of Jones Lang LaSalle has completed a 38-acre land sale in Phoenix’s southwest Valley that, by early 2013, will be home to approximately 600,000 square feet of speculative, state-of-the-art industrial space. Managing Directors Anthony J. Lydon, SIOR, and Marc Hertzberg, SIOR, of Jones Lang LaSalle represented the property buyer. The seller’s agent is Rich Sica of Daum Commercial.
The site, located at the northeast corner of 63rd Avenue and Sherman Way in Phoenix, was acquired by a venture between USAA Real Estate Company and Seefried Industrial Properties. The venture will proceed with the development of Estrella Logistics Center, a speculative, 592,500-square-foot, cross-dock distribution building.
“Seefried and USAA are specialists in developing, leasing and managing premier industrial logistics projects,” said Lydon. “They are experts at knowing what to build and where to build it, and they have chosen an exceptional time to deliver speculative industrial product in Phoenix.”
According to Jones Lang LaSalle research, there is approximately 6 million square feet of current user demand in Phoenix for requirements of 100,000 square feet or more; however, supply has not kept up with demand. As such, the market experienced an anaemic first quarter, with just 92,598 square feet of net industrial absorption as compared to a total 6.9 million square feet of net industrial absorption in 2011.
“The only local industrial construction that we’ve seen completed this year falls in the single-tenant, build-to-suit category,” said Hertzberg. “This does little to satisfy this market’s broader demand for large blocks of space. This will be the key driver for new Phoenix speculative industrial development in 2012.” Jones Lang LaSalle reports that demand for larger industrial spaces in the Southwest is the strongest among national retailers, food and beverage distributors, solar and e-commerce businesses. This is due in large part to Phoenix’s proximity to California, its 30 to 40 percent lower business costs, and the availability of quality land that is also near the market’s many accessible transportation lines.
The future Estrella Logistics Center site will be fully improved with all of the modern logistics amenities expected by the supply chain industry. The project sits just south of Interstate 10, between the 59th Avenue and 67th Avenue full interchanges.
Construction on Estrella Logistics Center is slated to begin in October and will be completed by May 2013. For occupancy, Seefried and USAA plan to pursue corporate employers seeking a scalable space solution.
Jones Lang LaSalle is a leader in the Phoenix commercial real estate market. Employing 344 of the area’s most recognized industry experts, the firm offers office and industrial brokerage, tenant representation, facility and investment management, capital markets and development services. In 2010, the Phoenix team completed 3.2 million square feet in lease transactions, directed $60 million in project management and currently has 13.5 million square feet under management.
For more news, videos and research resources on Jones Lang LaSalle, please visit our U.S. media center Web page.About Seefried Industrial PropertiesSeefried Industrial Properties specializes in developing, leasing and managing America’s premier business parks. It currently leases and manages nearly 18 million square feet for foreign and U.S. institutional clients and has developed more than 50 million square feet of both speculative and build-to-suit distribution facilities.
About USAA Real Estate CompanyUSAA Real Estate Company, with approximately $12 billion in assets under management, provides co-investment, acquisition, build-to-suit and development services for corporate and institutional investors. The USAA portfolio consists of office, industrial, retail and hotel properties as well as investments in real estate operating companies. USAA Real Estate Company is a subsidiary of USAA, a leading financial services company, serving military families since 1922. For more information, visit www.usrealco.com.
About Jones Lang LaSalleJones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2011 global revenue of $3.6 billion, Jones Lang LaSalle serves clients in 70 countries from more than 1,000 locations worldwide, including 200 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 2.1 billion square feet worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with $47 billion of assets under management. For further information, please visit www.joneslanglasalle.com.
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