Phoenix has grown into an attractive alternative to the neighboring, pricier cities for many companies thanks to its business-friendly environment and plenty of space available for development. Almost 1.5 million square feet of new office space—across eight projects—came online in the first quarter of 2021, according to CommercialEdge data.
As of March, roughly 3.2 million square feet of office space was under construction across 16 properties. A significant percentage of new supply is taken up by medical office space, with the metro attracting a lot of interest from the health-care, biosciences and life sciences industries. Except for one of the largest developments underway, every project on our list is slated for delivery by year-end. The table below highlights the most significant developments under construction in the metro.
|Rank||Property Name||Office Sq Ft||Submarket||Owner||Anticipated Completion|
|1||The Grand at Papago Park Center – Grand 3||280,000||Phoenix – Papago||Lincoln Property Co.||Q4 2021|
|2||One Hundred Mill||279,500||Tempe – Mill||Cousins Properties||Q4 2021|
|3||Phoenix VA Outpatient Clinic||275,157||Phoenix – Center City||US Federal Properties||Q2 2022|
|4||Scottsdale Entrada – Office Building||250,013||Scottsdale – South||Banyan Residential||Q4 2021|
|5||Creighton University Health Sciences Campus – Building 1||183,000||Phoenix – Central Corridor||Creighton University||Q2 2021|
|6||Choice Hotels International Headquarters||160,000||Scottsdale – Airpark||Nationwide Realty Investors||Q4 2021|
|7||Allred Park Place – Building 7||150,000||Chandler||Douglas Allred||Q3 2021|
|8||Allred Park Place – Building 8||150,000||Chandler||Douglas Allred||Q3 2021|
|9||Banner Health Center||127,243||Glendale||NexCore Group||Q2 2021|
|10||HonorHealth Neuroscience Institute||120,000||Scottsdale – South||HonorHealth||Q2 2021|
10. HonorHealth Neuroscience Institute
Starting the list is HonorHealth’s 120,000-square-foot, state-of-the-art medical center located on the Scottsdale Osborn Medical Center campus. Amenities include controlled access and a multilevel parking structure featuring 141 spaces. Taking shape on a 3-acre site at 7242 E. Osborn Road, the $44 million, five-story facility is slated for delivery later this spring.
9. Banner Health Center
NexCore Group is close to wrapping up construction on Banner Health Center’s medical office building in Glendale, Ariz. In late 2019, Siemens Financial Services originated $25.3 million in construction financing. SmithGroup is providing architectural services and Haydon Building Corp. serves as the contractor of the 127,243-square-foot development, which is near the Agua Fria Loop 101 and 75th Avenue.
7. & 8. Allred Park Place – Building 7 & Allred Park Place – Building 8
Douglas Allred Co. is developing two speculative office buildings within the company’s 200-acre Park Place mixed-use project in Chandler, Ariz. In mid-June, the developer received a $74 million financing package for the development of the 300,000-square-foot project.
The two identical, 150,000-square-foot buildings will rise across three stories and will feature 50,000-square-foot floor plates and a three-story parking structure. The project is located at 1375 and 1475 S. Price Road, with delivery set for the third quarter of the year.
6. Choice Hotels International Headquarters
The 160,000-square-foot, five-story Choice Hotels International Headquarters is taking shape in the Scottsdale – Airpark submarket. The development is part of Nationwide Realty Investors’ 134-acre Cavasson mixed-use development located at Loop 101 and Hayden Road. The developer expects to complete the project in late 2021. The building will house Choice Hotels’ technology division.
5. Creighton University Health Sciences Campus – Building 1
Creighton University is developing its Health Sciences Campus within the Phoenix – Central Corridor submarket. The $100 million Phase I will comprise 183,000 square feet across the building’s seven stories, with Plaza Cos. overseeing construction. The project is rising at 3100 N. Central Ave., less than a mile from St. Joseph’s Hospital and Medical Center and some 3 miles from the headquarters of Banner Health System. The development is slated for completion in the second quarter of 2021.
4. Scottsdale Entrada – Office Building
Banyan Residential is working on the 250,013-square-foot Scottsdale Entrada in the Scottsdale – South submarket. In addition to office space, the mixed-use project includes 736 residential units and 5,000 square feet of retail. Scottsdale Entrada is taking shape at 64th Street and McDowell Road on a 33-acre site within an Opportunity Zone. The development received an $82 million construction loan from Bank OZK. The three-story office component is anticipated for completion at the end of 2021.
3. Phoenix VA Outpatient Clinic
US Federal Properties is behind the development of the 275,157-square-foot U.S. Department of Veterans Affairs outpatient health clinic, which will be one of the largest VA facilities in the country. The project broke ground in summer 2019, with Hoefer Wysocki providing architectural and interior design services, while Jacobsen Construction Co. is the general contractor. The five-story building is scheduled to come online in the second quarter of 2022. Phoenix VA Outpatient Clinic is located at 400 N. 32nd St. in the Phoenix – Center City submarket. Fifth Third Bank originated $110.7 million in construction funding in early 2019.
2. One Hundred Mill
Cousin and Hines have teamed up for the 287,000-square-foot project taking shape in the Tempe – Mill submarket. One Hundred Mill includes 279,500 square feet of office and 7,500 square feet of retail space.
Amazon signed on for 95,000-square-foot space that will serve as the company’s Phoenix Tech Hub expansion, while Deloitte committed to 35,000 square feet at the 18-story tower. The $135 million development is seeking LEED Silver certification and is set to deliver at the end of 2021. The project is situated at 100 South Mill Ave., within walking distance of public transit and just 4 miles from Sky Harbor International Airport. One Hundred Mill will feature a fitness center and a covered first-floor outdoor patio.
1. The Grand at Papago Park Center – Grand 3
Taking shape within the 500-acre Papago Park Center mixed-use development in Tempe, Ariz., Grand 3 will feature 280,000 square feet of premier office space across nine stories. Lincoln Property Co. is developing the project, which is the third of a total of eight office buildings planned at The Grand at Papago Park Center.
Located at 1033 W. Roosevelt Way, Grand 3 is the largest office development underway in the Phoenix market. Located 10 miles east of downtown, the project will feature 31,000-square-foot floor plates, an indoor/outdoor rooftop lounge and a fitness center, as well as a conference facility. Grand 3 is expected to reach completion at the end of 2021. In December 2020, Lincoln sold the second building on the campus, marking the largest office deal in Arizona last year.