Phoenix, Arizona – CBRE announced that an industrial property, Desert Gateway II, in Phoenix sold to San Francisco-based real estate investment firm Catalyst Real Estate for $13.5 million.
Mark Shaffer, Geoff Turbow and Anthony DeLorenzo of CBRE represented Catalyst Real Estate in the off-market transaction. The seller, a private investor, was self-represented. The CBRE Debt and Structured Finance team of Jim Korinek, Shaun Moothart, Dana Summers, Doug Birrell, and Bob Ybarra advised Catalyst on its financing options for the transaction.
Located at 747 and 777 West Pinnacle Peak Road, Desert Gateway II was originally built in 2018 and is comprised of two multi-tenant buildings totaling 36,004- and 40,870-square-feet. The class A property features 20’ clear height, 12’ by 14’ overhead doors and air conditioning throughout the office and warehouse space. Suites range from 2,252- to 6,778-square-feet.
“Phoenix is a high-growth market where investors can acquire newly-developed assets with strong cash flow at a relative discount to coastal markets,” said Turbow. “With strong industrial market fundamentals, multi-tenant industrial assets are highly desirable and can provide a significant hedge against economic headwinds.”
Added Korinek, “In the COVID 19 environment, lenders are focusing nationwide on the attractiveness of financing industrial properties as most other asset classes appear relatively less secure. An ‘A’ quality industrial property like Desert Gateway in a desirable market like Phoenix attracts intense attention from lenders including life insurance companies, banks, and CMBS lending platforms. Desert Gateway was a beneficiary of that interest.”
The Phoenix industrial market’s momentum continued into the third quarter with 2.16 million square-feet of positive net absorption, its 42nd consecutive quarter of gains according to a CBRE research report. Currently, 11.8 million square-feet of industrial space is underway across the Phoenix market. At the end of the quarter, 54.2 percent of the space under construction was committed to by tenants currently located in the market and new entries to Phoenix.