Scottsdale office building sells to Dallas-based Velocis
– October 28, 2019 – Kierland One, a 175,441-square-foot Class A office
building in Scottsdale, Arizona has a new owner. Dallas-based Velocis purchased the building
from Hines and joint venture equity partner PCCP, LLC (PCCP).
Barry Gabel, Chris Marchildon and Will Mast of CBRE
in Phoenix represented the seller in the transaction.
The four-story Kierland One is 90 percent leased and
features institutional-quality construction and finishes, including a remodeled
two-story lobby, new tenant improvements and high-end spec suites. It has a
generous parking ratio of 4.3 spaces per 1,000 RSF. The property includes the
global headquarters of a publicly traded engineering and manufacturing company,
as well as several other notable financial services, technology, hospitality and
residential related companies.
“The quality of the asset and tenancy, as well as
the walkable amenities in the Scottsdale Airpark submarket make Kierland One an
attractive asset for our investment strategy,” said Jim Yoder, partner,
Velocis. “Phoenix continues to be one of the strongest job creation markets in
the country, and we are pleased to expand our presence in the market. We look
forward to building on the great work that Hines and PCCP accomplished at Kierland
One by putting our own Velocis stamp on the property.”
The property offers tremendous Scottsdale Road frontage
and is surrounded by numerous first-class amenities, including the high-end
shopping and restaurants at Kierland Commons and Scottsdale Quarter and The
Promenade among others; the Fairmont Scottsdale Princess Resort, The Westin
Kierland Resort & Spa, and the JW Marriot Desert Ridge; as well as countless
“Kierland One presented an incredible opportunity
for Velocis to continue its investment into the Phoenix market with the
acquisition of a high-quality, well-located office asset, offering unmatched
access to Scottsdale’s high-end retail, restaurant and hotel amenities, and a
diverse and well-educated labor pool,” said CBRE’s Gabel. “We’re happy to have
achieved exceptional outcomes for both Hines/PCCP and Velocis — all long-term
valued clients of ours.”
Kierland One is located in the Scottsdale Airpark
submarket, the second-largest employment hub in metro Phoenix, where there are
an estimated 12,000 businesses and more than 145,000 employees. The property’s
strategic location provides direct access to the Loop 101 freeway, allowing for
access to the large and diverse labor markets of Scottsdale, Phoenix, Tempe,
Chandler and Mesa.
The Scottsdale Airpark submarket consistently
outperforms the overall Phoenix market in average rental rate and absorption of
office space. At the end of the third quarter of 2019, the submarket’s office
vacancy rate dipped to 11.49 percent, falling below the overall Phoenix market
vacancy rate of 14.39 percent, according to CBRE Research.
CBRE’s Luke Walker, Brad Anderson and Mike
Strittmatter will continue to lease the property under new ownership. Hines
will continue to serve as the property manager.
Kierland One is Velocis’ third investment in the
Phoenix market in recent years. In 2016, Velocis purchased Park One, a
three-building complex in the prestigious Camelback Corridor. In addition,
Velocis owned Camelback Square, a three-story Class A office building in the
heart of Old Town Scottsdale from 2015 to 2019.
Dallas-based Velocis has been active in real estate
since 2010, purchasing 31 assets located in major markets within Arizona,
Colorado, Texas, Georgia, Florida, North Carolina, Virginia, and the Washington
D.C. Metro Area. Velocis is led by a team of five seasoned partners who are
directly responsible for the acquisition, asset management and disposition of
assets. Partners in Fund II are Fred Hamm, Mike Lewis, Jim Yoder, Paul Smith
and David Seifert.
Velocis is a private equity real estate investment firm active in
the acquisition, operation/management and disposition of commercial real estate
in the United States. Additional information about Velocis can be found at velocis.com.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company
headquartered in Los Angeles, is the world’s largest commercial real estate
services and investment firm (based on 2018 revenue). The company has more than
90,000 employees (excluding affiliates) and serves real estate investors and
occupiers through more than 480 offices (excluding affiliates) worldwide. CBRE
offers a broad range of integrated services, including facilities, transaction
and project management; property management; investment management; appraisal
and valuation; property leasing; strategic consulting; property sales; mortgage
services and development services. Please visit our website at www.cbre.com.
This does not
constitute an offer to sell, or a solicitation of any offer to buy any
securities or investment advice, nor is it intended to be a description of all
material factors an investor should consider before making any