Thinking outside of the big box delivered one-of-a-kind space for Comcast Cable

TUCSON, ARIZONA – For office tenants able to think outside of the big box, Arizona’s lingering retail vacancies can equate to major opportunity. Such is the case with the recently completed renovation of the Tucson Galleria – a $16.4 million effort led by the Phoenix office of JLL that transformed a long-vacant retail mall into a cutting-edge Western region customer support center for Comcast Cable.

“Comcast was looking for a well-located building with a great selection of nearby restaurants and amenities, and a strong public transportation network for its employees,” said Derek Ruterman, Vice President for JLL’s Project Development Services (PDS) group in Phoenix, and manager of the Comcast renovation. “They were able to look beyond this building’s label as ‘retail’ space to see that the property checked all of their boxes as a superior location for a new regional support center.”

Located at 4690 N. Oracle Road in Tucson, the 165,000-square-foot Comcast facility was originally built in the mid-1980s, initially serving as a multi-tenant retail mall and, later, as an American Home Furnishings store. The furniture retailer vacated the space several years ago, leaving the space empty until Comcast selected the building for its new support center.

Through a JLL-directed redesign, this former mall now operates as a flexible and creative corporate environment that is solely occupied by Comcast. Approximately 1,200 employees work at the site, providing IT, call center and social media services.

Features of the new service center include:

• Three floors totaling 165,000 square feet and a covered parking garage with 1,050 spaces.
• Creative, flexible indoor spaces that incorporate the building’s original elevator, escalators and central atrium, providing a uniquely open feel and strong connectivity between workspaces.
• Custom, structurally supported steel light rings with suspended LED’s that span the atrium and create brightly lit atmospheres in spaces without any windows.
• State-of-the-art video conference rooms, training rooms and large meeting rooms.
• On-site amenities designed to attract and retain young Millennial employees, such as a large outdoor patio space, a fitness facility with locker rooms and gaming spaces on each floor. Micro Markets are also incorporated on each floor, providing fresh food selections brought in daily for employees.
• A former movie theatre that has been re-purposed to support meeting and break room requirements.

“This building has a central atrium unlike anything you’ll find in a typical office building and that creates a uniquely bright and airy work environment,” said Ruterman. “We continued that open approach throughout the project, blending exposed ceilings, floating acoustic panels and suspended linear LED lighting that pulls the eye up toward this building’s great ceiling features.”

“The Comcast project is a testament to what can be accomplished when the right team, the right tenant and a shared creative vision come together,” added David Rosato, Senior Vice President and head of JLL’s Phoenix PDS group.

The former mall building was chosen by Comcast for its abundance of nearby amenities (including the Tucson Mall), its large bilingual customer service labor pool and the convenience of the Mountain Time Zone. The facility brings approximately 1,200 new jobs to Tucson, making Comcast one of Southern Arizona’s top 40 employers and representing a $385 million economic impact for the region. At least 15 percent of Comcast’s new positions are being filled by reservists, veterans and their spouses or domestic partners.

Construction on the Comcast project began in August 2015 and completed in the the spring of 2016. The landlord is The Tanager Company, LLC. The project architect was Acquilano Leslie, Inc. The builder was Jokake Construction.

JLL’s Phoenix PDS group provides consultation, project management, design and construction management services for projects ranging from office to industrial to retail. In 2015, the JLL Phoenix PDS team completed 67 projects valued at $125 million and they have completed 18 projects year-to-date, including the award-winning Isagenix Class A office headquarters in Gilbert and the Northern Trust office complex at Discovery Business Campus in Tempe. The team has numerous projects currently underway, including development, management, multi-site, tenant fit out and consulting assignments. Nationally, JLL has 404 LEED accredited professionals, including many in Phoenix.

By: Joe Ferguson | Staff Writer | Arizona Daily Star

The City of Tucson finally got a closer look at what HSL Properties wants to build in place of the colorful yet dated buildings of La Placita Village.

The developer offered up preliminary conceptual designs to the Tucson-Pima County Historical Commission that feature retaining several historic structures while building a new six-story apartment building.

Jonathan Mabry, the city’s historic preservation officer, said the plans will protect three existing buildings in the iconic development at 110 S. Church Ave. The remaining buildings will be torn down to make room for the new development.

Each of the three buildings is eligible for listing in the State and National Registers of Historic Places by the State Historic Preservation Office.

They include the Samaniego House, the Flin Building, and the Stables, all that date from the late 19th century to the early 20th century and are surviving remnants of Tucson’s downtown barrio.

Omar Mireles, the president of HSL Properties, said the designs were simply conceptual, and his company has plans for ground-floor retailers that allow for public access to the historic structures.

Mireles said he hoped to break ground next year on the project, but acknowledged the company has a long road ahead regarding the development process.

All current tenants were told to vacate the property by the end of July.

Plans submitted to the city do not include any changes to La Placita’s parking garage.

Read more at Arizona Daily Star

Real Estate Daily News Buzz is designed to give news snippets to readers that our (yet to be award winning) editors thought you could use to start your day. They come from various business perspectives, real estate, government, the Fed, local news, and the stock markets to save you time. Here you will find the headlines and what the news buzz of the day will be.

Thursday, the Dow Jones industrial average gave up 2.95 points to 18,352.05. The Standard & Poor’s 500 index added 0.46 of a point to 2,164.25. The NASDAQ composite gained 6.51 points, or 0.1 per cent, to 5,166.25.

Benchmark U.S. crude rose $1.10, or 2.7 per cent, to $41.93 a barrel in New York after a 3 per cent climb Wednesday. Brent crude, a benchmark for international oil prices, added $1.19, or 2.8 per cent, to $44.29 a barrel in London. In other energy trading, wholesale gasoline rose 2 cents to $1.37 a gallon. Heating oil added 4 cents to $1.33 a gallon. Natural gas fell 1 cent to $2.83 per 1,000 cubic feet.

US stocks barely budge ahead of monthly jobs report — U.S. stocks wavered Thursday and finished barely higher as an interest rate cut by the Bank of England, a move intended to shore up the British economy, wasn’t enough to get investors out of their cautious mode. Technology companies continued to make the biggest gains. Oil prices rose for the second day in a row, something that hadn’t happened for almost three weeks. Bank stocks fell the most, as the interest rate cut suggests they won’t be able to make as much money on lending.

UK central bank tries to soften Brexit shock on economy — Britain’s central bank launched a range of stimulus measures Thursday meant to jolt confidence back into an economy shocked by the vote to leave the European Union. Analysts, however, say they may not be enough to halt a slide toward recession. In a multipronged approach intended to grease the gears of the economy by making borrowing easier and cheaper, the Bank of England cut its key rate to 0.25 per cent from a previous record low of 0.5 per cent. It also agreed to pump new money into the economy through the purchase of government bonds and will buy up corporate bonds to make it easier for companies to borrow.

Requests for US unemployment aid rise to still-low 269,000 — More Americans applied for unemployment benefits last week, but the number of remained close to historic lows in a positive sign for the job market. Applications for jobless aid rose 3,000 to a seasonally adjusted 269,000, the Labor Department said Thursday. The four-week average, a less volatile measure, increased 3,750 to 260,250. The number of Americans collecting benefits has fallen 5.4 per cent over the past year to 2.14 million.

Average US 30-year mortgage rate declines to 3.43 per cent — Long-term U.S. mortgage rates declined this week after rising for three straight weeks, continuing to lure prospective homebuyers. Mortgage giant Freddie Mac said Thursday the average for the benchmark 30-year fixed-rate mortgage fell to 3.43 per cent from 3.48 per cent last week. The 15-year fixed mortgage rate dipped to 2.74 per cent from 2.78 per cent last week. Record-low interest rates this year have helped spur home purchases and boost the housing market.

Wal-Mart May Buy Amazon Challenger Jet.com for $3 Billion “Launched a year ago, Jet.com has received a huge amount of hype after getting hundreds of millions in funding and a nearly $600 million valuation before selling a single purse, microwave, or bottle of laundry detergent on its e-commerce site. Founded by Diapers.com founder Marc Lore, Jet originally launched its membership-based e-commerce site in July 2015 to take on brick and mortar warehouse clubs like Sam’s Club and Costco while also competing against Amazon’s bulk products business.” (Fortune)

CRE Investors Experiencing Déjà vu in Search for Yield “When I began writing this story on the search for yield in a low-yield environment this week, it had a familiar ring. Turns out this was the same gist of a story I wrote in 2007 — at the last peak of CRE valuations. Back then, I wrote: Companies are less likely to bite on deals, but there is no lack of sellers pushing product and capital doesn’t appear to be too constricted, just that lenders are a little more demanding. The majority of real estate CEOs and senior executives expect 2007 to be a year of revenue growth and higher profits, marked by a race to find appropriate investments and take advantage of growth opportunities in a market that continues to be flooded with capital.” (CoStar News)

Slow Growth Outlook: Now Worries for Real Estate? “Recent reports on a number of economic fronts–GDP growth, interest rates and Brexit, to name a few–have not been encouraging. Are these conditions a harbinger of the next downturn, or could they portend an extension of the “Goldilocks” economy that has been so good for commercial real estate? Maybe the most disappointing news was second-quarter GDP growth, which came in at a weaker-than-expected annualized rate of 1.2 percent, while consensus forecasts called for 2.6 percent.” (Commercial Property Executive)

Supervalu Will Consider Save-A-Lot Sale “In an apparent acknowledgement of reports that several private equity firms would bid to acquire Save-A-Lot, Supervalu said Tuesday that it still intends to move forward on a plan to spin off the discounter to shareholders, but is also considering an outright sale. In a statement, the Minneapolis-based wholesaler ‘reaffirmed that it is preparing for a separation of its Save-A-Lot business. As part of that process, Supervalu has pursued and continues to pursue a spin-off of Save-A-Lot,’ as described in registration forms with federal securities regulators.” (Supermarket News)

The Big Chill: From Brexit to the U.S. Election, Uncertainty is Freezing Market Activity “While new presidential administrations always mean new changes, given what Trump has said about rescinding trade pacts (as well as some of America’s traditional alliances), the GOP candidate has added an extra layer of ice to investors plotting their next move. (Disclosure: Jared Kushner, the publisher of Commercial Observer, is Trump’s son-in-law.) Both of these events—one a fait accompli, the other still undecided—have made 2016 the year when a lot of big decisions go straight to voicemail.” (Commercial Observer)

Hong Kong Pays $1.2B for Stake in Salesforce Tower “An investment fund controlled by Hong Kong’s de-facto central bank bought a 49-percent stake in the Salesforce Tower New York from Ivanhoe Cambridge and Callahan Capital Partners for $1.15 billion, property records show. The buyer, Real Summit Investment, is a real estate investment subsidiary of the Hong Kong Monetary Authority’s Exchange Fund. Ivanhoe Cambridge, the real estate investment arm of Quebec’s public pension plan, and Chicago-based fund manager Callahan, bought the 1.2 million-square-foot tower, also known as 3 Bryant Park, for $2.2 billion from the Blackstone Group in January 2015.” (The Real Deal)

10 REITs Yielding 10% or More “With the stock market near all-time highs and global interest rates near all-time lows, it’s getting harder and harder for long-term investors to find reliable sources of income. A number of investors are now turning to dividend stocks to pick up the slack of low bond yields. Real estate investment trusts (REITs) offer some of the highest yields in the market. Maybe the best part about these investments is that they are legally required to distribute at least 90 percent of their earnings to shareholders via dividends. This payout mandate means that a number of REITs have extremely high yields.” (Benzinga)

Construction on the Wynn Casino Will Likely Start This Week in Everett “Somerville officials will not ask the Massachusetts Department of Environmental Protection to reconsider its decision to give Wynn Resorts a waterfront construction permit, clearing the way for resort casino construction to begin within the next couple of days in Everett. The city had until early this week to ask for a reconsideration after DEP Commissioner Martin Suuberg issued the decision in late July, subject to certain conditions. City spokeswoman Denise Taylor confirmed Tuesday that the city will not make that request.” (Boston.com)

Landlord of Park Avenue Office Tower Lands New York-Presbyterian “New York-Presbyterian has struck a deal to take about 500,000 square feet of office space at 237 Park Ave., according to several sources with knowledge of the hospital’s decision. The hospital system has been searching Manhattan for office space so it could consolidate administrative and office operations from several locations around the city. The terms of the deal, including the length of the lease and the rent that New York-Presbyterian agreed to pay, were not immediately clear.” (Crain’s New York Business)

Miami Retail Center Changes Hands for $285M “Weingarten Realty Investors has acquired The Palms at Town & Country, a 667,757-square-foot open-air retail center in Miami, from TIAA Global Asset Management. The property fetched a whopping $285 million, according to the South Florida Business Journal. HFF represented the seller in the transaction, led by Senior Managing Director & Co-head of HFF’s retail practice Daniel Finkle, Managing Director Luis Castillo and Associate Director Nat Scarmazzi.’ (Commercial Property Executive)