More Industrial Space Coming to Greater Phoenix

MET 202 site. Image courtesy of CBRE

Phoenix-based Eisenberg Co. has paid $16.6 million for a 56.5-acre parcel in Mesa, Ariz., with plans to develop a five-building, 770,000-square-foot industrial park dubbed MET 202. Public records show the firm acquired the development site from Hawk Ventures LLC, an entity affiliated with Digital Realty Trust.

The new owner intends to immediately break ground on the Class A development that will come online at the intersection of Crismon Road and Elliot Road within Mesa’s Elliot Road Technology Corridor. Once completed, the buildings, designed by Butler Design Group, will range from 77,000 to 221,000 square feet and will have 32-foot clear height as well as both grade-level and dock-high loading, among other features.

Situated roughly 19 miles southeast of downtown Mesa, the MET 202 site is across the road from Niagara Bottling’s 450,000-square-foot production facility. The site is also close to Trammell Crow’s recently announced project that will bring 516,601 square feet of Class A industrial space to the area in 2022.

JLL’s Steve Larsen represented the buyer, while CBRE’s Barry Gabel, Chris Marchildon and Will Mast represented Digital Realty in the deal.

The data center that never was

DuPont Fabros Technology Inc. acquired the parcel back in 2017, with the intention of building a new data center. According to preliminary plans submitted to the city by architecture firm Jacobs Engineering Group in 2019, the project was supposed to comprise some five buildings ranging from 232,000 to 1.1 million square feet. However, those plans never came to fruition.

The same year, Digital Realty acquired DuPont in a $7.8 billion deal that also included the assumption of $1.6 billion of DuPont’s existing debt. Although the Mesa data center project remained on the table until earlier this year, Digital Realty ultimately decided to sell the parcel and the land was repurposed for industrial use.

Within the tech corridor

The City of Mesa describes the Elliot Road Technology Corridor as “a smart location for high-tech manufacturers and data centers”, due to the presence of redundant power, fiber conduits and natural gas, as well as a substantial water and wastewater infrastructure network. In addition, the City created a Planned Area Development Zone in the Corridor in order to reduce entitlement risk and expedite the development process, with the Overlay Zone designated as light industrial.

Currently home to Apple, Google and EdgeCore, the tech corridor continues to welcome various companies that have started developing projects in the area since the beginning of the year. Apart from Trammell Crow, another noteworthy example is Facebook, which is constructing a 960,000-square-foot data center at 3841 S. Ellsworth Road.

In May, Marwest Enterprises broke ground on a 1.1 million-square-foot speculative industrial campus. Slated for completion in the first quarter of 2022, the two-building development will come online at 8450 and 8604 E. Elliot Road.

CommercialEdge information shows metro Phoenix had some 25.6 million square feet of industrial space underway as of August, representing 9.6 percent of stock. The Mesa submarket’s pipeline accounts for 3.4 million square feet.