Creation Kicks Off 120 KSF Industrial Development in Phoenix Area
A tech company is leasing one of the buildings for its Southwest headquarters.
Creation has started work on a six-acre industrial development in Tempe, Ariz., that will total 120,000 square feet in two buildings. Joint venture partner Pacific Office Automation, a tech company, has committed to leasing one of the buildings, which it will use as its Southwest headquarters.
Pacific Office Automation is taking the development’s 75,000-square-foot building, while a separate 45,000-square-foot building is available for lease or sale. Located at 1400 W. 3rd Street near Loop 202 and I-10, the property provides close access to Sky Harbor International Airport.
The buildings feature 32-foot clear heights and 185 parking spaces, including eight EV charging stations and 14 bike parking spaces. There is a shared truck court. LGE Design Build is the architect and general contractor for the project.
READ ALSO: Phoenix’s Industrial Pipeline Expands but Deliveries Slow
Creation has been active in the Tempe submarket. The company’s most recent projects in Tempe include Source Business Center and Nexus Commerce Center, which broke ground earlier this year. Last year, Creation sold Midway Commerce Center, a 301,994-square-foot industrial campus in Chandler, Ariz., for $57 million.
Demand for more modern industrial infill in North Tempe is brisk, according to Grant Kingdon, principal of Creation’s Mountain West region. He notes in a statement that 90 percent of Tempe’s industrial buildings between 40,000 square feet and 60,000 square feet were developed before 2000.
Phoenix Industrial Fundamentals Solid
The metro Phoenix industrial market saw net absorption of 6.4 million square feet in the third quarter of 2025, CBRE reports. That is the highest absorption since the second quarter of 2022, which was during the afterglow of the pandemic-inspired spike in demand, driven by online orders. Large users are driving current demand, with CEVA Logistics taking 1.3 million square feet and Walmart taking almost as much, 1.27 million square feet.
The demand-supply imbalance was reflected in a 90-basis-point decrease in the market-wide industrial vacancy rate to 11 percent, quarter-over-quarter. That was the second quarterly decrease in a row for that metric, a downward trend that hasn’t happened since 2022.
You must be logged in to post a comment.