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This old Irish blessing, “may the road rise up to meet you”, takes on a whole new meaning in a deal struck by the City of South Tucson and local developer, Larsen Baker. Welcoming new jobs, the City Council did not waste any time unanimously agreeing to a rededication of a portion of Old Vail Road in order to make room for redevelopment of an office campus.

When Larsen Baker of Tucson looked into buying the Madera Business Park at 2750-2760 S 4th Avenue in South Tucson, they went to the City Manager’s office to discuss a problem they saw with regard to the property. That problem being the matter of Old Vail Road bifurcating the property.

“The distressed property sold back in 2007 when prices were high,[mepr-show rules=”58038″] for $2.8 million and had since fallen victim to the recession,” said George Larsen of Larsen Baker. “Our goal when we started was to figure out a way in which we could convert the property from its current industrial incubator use into a gated office campus.”

The 35,200 sq. ft. Madera Business Park had been almost vacant for quite some time, leaving an odd tenant mix of a crematorium and a Domino’s Pizza. The lender, Maple Madera, LLC, held by Trimont Real Estate Advisors of Ivine, CA, sold the property for $650,000 (under $19 PSF) in an REO sale to Larsen Baker.

The City of South Tucson covers a small area of about 1.2 square miles at the junction of Interstate 19 and Interstate 10 and about 1 mile south of downtown Tucson. It is bounded on three sides by two freeways and the Union Pacific railroad tracks, completely surrounded by the City of Tucson, Arizona.

Larsen knows it is a good location, within an empowerment zone and only blocks from downtown Tucson. “That’s exactly what call centres, NGO Health Services and GSA are wanting,” Larsen revealed. “This will be more than a redevelopment, it’s a ‘repurposing’ of the property, with a guard house entry at the front and a wrought iron surround for a new office campus.”

Enrique Serna of the City Manager office met with the developer and presented the project to City Council. He agreed that dedicating the section of Old Vail Road from 4^th Ave to 5^th Ave in exchange for the appraised value going for landscaping improvements on behalf of the City and the El Paso Greenway project represents the best thing to happen in South Tucson for quite some time.

The developer already has a tentative tenant wanting 18,000 sq. ft. and with the road dedication will be able to develop the project into a 40,000 sq. ft. office campus. With estimated development costs of $50 PSF, or approximately $2 million, there is room to allow for reasonable market rates. If all goes as planned, tenants could start moving in next year, bringing new jobs to South Tucson.

Keri Silvyn, Partner at Lazarus, Silvyn & Bangs, PC acted as legal counsel for the developer in negotiations with the City.

Brandon Rodgers of Cushman & Wakefield / Picor represented the seller and Andy Seleznov and Melissa Lal of Larsen Baker represented the investor in the transaction.

Silvyn should be contacted at (520) 207-4464. Rodgers is at (520) 546-2714. Seleznov and Lal can be reached at (520) 296-0200.[/mepr-show]

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[ismember]Sale date was 7/29/2013. The road was valued at $2.50 PSF. Land area prior to road addition was 2.7 acres. We did not research how much additional land are the road brought to the property. [/ismember]

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Providence Corporation acquired the 30,000 sq. ft., four-story building at 44 East Broadway Blvd., Tucson in 2010, for $3 million to redevelop. The company occupies the second floor for its IT Department, and leases the third floor to Peach Properties and the Sonoran Institute. Providence worked with Peach Properties to develop four residential lofts with rooftop decks on the top floor for resale. The Green Chamber is occupying the ground floor.

The University of Arizona Foundation purchased the last remaining residential condo in the building for[mepr-show rules=”58038″] $334,000 ($185 PSF) for the 1,803 sq. ft. condo that sold in shell condition. The Foundation purchased the condo to be used as guest quarters for visiting staff and out of town guests.

Since inception, more than 25 years ago under the direction of Ron Schwabe, Peach has developed over 2,400 residential units and more than 600,000 sq. ft. of commercial space totaling over $155 million in projects. Half of these have been in the historic core of Tucson at such projects as 1 East Toole, 119 East Toole, 64 East Broadway, 50 East Broadway, 44 East Broadway, 210-220 East Broadway and One North Fifth where the company is actively involved in transforming the look and use of historic buildings.

The project at 44 E Broadway, with only a 1,000 sq. ft. retail space available, has Peach Properties and former officer of The Providence, Fletcher McCusker, moving on to a new development project downtown. This time at 1 East Toole Avenue where Peach Properties is redeveloping this 18,000 sq. ft. corner stone property, originally built as a produce warehouse, in the Warehouse Arts District, into a “hip, open office space, split with a new collaborative workspace,” and dubbed the ‘Toole Avenue Hive’ by Schwabe.

McCusker has moved his new start-up business, Sinfonia, into the former produce warehouse. In April, Sinfonia agreed to purchase 49% interest in Tucson-based Assurance Home Care and Assurance Caregivers. The company subsequently acquired Serenity Hospice, a local home-based hospice care service and AirVida, another Tucson-based oxygen and sleep therapy business. The concept being to combine all the home health care products under one roof.

McCusker is quoted in a recent interview with the Arizona Daily Star as saying, “The driver for all this is the Affordable Care Act. Under the new rules, as you and I age, they can’t just stick us in a nursing home. You’re going to have to demonstrate that home health care was unsuccessful.” Some 45 million people are expected to be eligible for such services by 2014.

Besides Sinfonia, The Hive provides space for UofA’s Eller College of Management, the McGuire Center for Entrepreneurship and Startup Tucson, a nonprofit, tech-oriented startup offshoot from Gangplank.

McCusker who is also chairman of the Rio Neuvo downtown redevelopment project sees the Hive as part of an emerging Downtown Innovation District, which includes Gangplank Tucson based in the old Pioneer Building; that we reported on in March https://realestatedaily-news.com/tucson-lease-report-week-of-march-25-29/ and in May https://realestatedaily-news.com/tucson-lease-report-week-of-may-20-24/

The Maker House, an artisan focused collaborative space operating from the historic Bates Mansion that we reported on in April https://realestatedaily-news.com/tucson-lease-report-week-of-april-15-19/ is another part to the hotspot.

Xerocraft Hackerspace with its 25 members, is a tech-oriented nonprofit that will soon move into 2,000 sq. ft. at the Steinfield Warehouse, 101 W Sixth Street. Xerocraft was founded in 2011 as a small club of passionate hackers and makers. It incorporated in January 2012 in order to become a 501c(3) tax-exempt status and received IRS approval on May 11, 2013.

The Steinfield Warehouse Community Arts Center and WAMO (Warehouse Arts Management Organization) have a waiting list for 7 affordable live/work apartments within the historic Steinfield Warehouse currently under renovation. Units will be ready in the spring to summer of 2014 and will be filled on a first come / first served basis.

Tucson appears to be emerging as a “hotspot for entrepreneurs” these days and was named one of five emerging hubs for entrepreneurs in the August issue of Entrepreneur Magazine. “The success in Tucson is a result of the community taking deliberate, ordered steps to surround startups with help,” according to the magazine.

Ron Schwabe should be contacted at (520) 798-3331 and Patricia Schwabe can be reached at (520) 603-6103. McCusker should be reached at (520) 623-7336.[/mepr-show]

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Tom and Carmen Long of San Pedro, CA purchased the Treat Apartments at 2120 N Treat Avenue in Central Tucson for[mepr-show rules=”58038″] $760,000 ($47,500) from Ryszard Kupinski of Tucson. The 16-unit apartment is located on Treat Avenue just south of Grant Road in Central Tucson. The unit mix consists of two studio units, one one-bedroom / one bath of approximately 600 SF, and 13 two-bedroom / one bath units of approximately 740 SF each. The property is a total of 11,200 sq. ft. in seven buildings on 1.22 acres.

The Treat Apartments offer its residents covered parking and laundry hookups. The garden style complex was built in 1960 and is individually metered. Occupancy was reported to be near 100% over the past few years with many long-term residents.

Allen Mendelsberg of Cushman & Wakefield / Picor in Tucson represented the seller and Roger Breckenridge and Tony Reed with Long Realty of Tucson represented the investor.

Mendelsberg should be contacted at (520) 546-2721. Breckenridge is at (520) 918-5813 and Reed can be reached at (520) 918-5189.[/mepr-show]

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[ismember]Sale date: 7/30/2013. Property was marketed at an 8.5% cap rate with asking price undisclosed. Zoned R-2, with seven single story brick buildings. Buyer purchased with $190,000 down and financed the balance with US Bank, NA. [/ismember]