Tempe’s Bet on Lake Turns into Successful Shores

Original Article via Phoenix Business Journal | Alexa D’Angelo

It’s no secret construction for commercial real estate has been booming along Tempe Town Lake for the past several years. Commuters are all too familiar with the roadblocks and construction along Mill Avenue.

But Tempe Town Lake could continue to be the beacon in the Valley for commercial real estate. David Genovese, managing director at Avison Young in Phoenix, said he believes the area will see even more changes during the next few years, keeping it the hot spot for commercial real estate for the foreseeable future.

“I believe the area will continue to develop for many years to come,” Genovese said. “The Grand at Papago is an impressive project under construction that, when built out, will materially change the complexion of the north side of the lake. ASU is planning to redevelop the golf course and baseball stadium sites along Rio Salado, which will add additional density to the area along with additional sports facilities being discussed as possibilities.”

According to the second quarter CBRE report on office space, 20 percent of the submarkets accounted for more than 90 percent of the market’s total net absorption. Submarkets that posted the highest net absorption included Tempe and Scottsdale Airpark, the report shows.

Genovese said he believes the popularity of the Tempe Town Lake area is due to the surrounding amenities.

“Obviously, water is a rare commodity in the desert and even more scarce as an amenity to an urban neighborhood like Tempe,” Genovese said. “The ‘lake’ is situated next to one of the largest universities in the country, making it accessible to a large, vibrant young workforce and energetic population. Additionally, the lake provides a unique landscape and views for the surrounding office buildings, and it’s conveniently located to the airport and freeways.”

For the fourth consecutive quarter, Tempe led all submarkets with 333,821 square feet of positive net absorption, according to the CBRE report, citing the city’s ideal location, walkable amenities and proximity to Arizona State University as the three main reasons commercial real estate is drawn to the area.

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