California Firm Makes $168M Splash in Mesa’s Industrial Real Estate Market
Mesa, Arizona, has captured the spotlight in the industrial real estate market as Irvine, California-based CIP Real Estate closed a blockbuster $168 million deal to acquire Broadway 101 Commerce Park. This acquisition not only marks CIP’s debut in the Phoenix metro market but also stands as the largest industrial transaction of 2024 in the region.
The Deal in Detail
Broadway 101 Commerce Park, situated at Dobson and Broadway Roads in Mesa, spans 52 acres and includes 809,230 square feet across 11 buildings. Built in 2005 and 2007, this business park is strategically located near the bustling Tempe and Phoenix Sky Harbor submarkets. The property is currently 98% leased, housing 34 tenants, making it a highly attractive investment.
CIP paid approximately $211 per square foot for the property, setting a high bar for industrial sales in the Valley. This acquisition represents a significant leap for the firm, which has long sought an opportunity to enter the Phoenix market. According to CIP CEO Eric Smyth, this is a “rare opportunity” and will serve as the base for their broader industrial portfolio expansion in Arizona.
A Hot Market for Institutional Investors
Phoenix’s industrial real estate market is booming, driven by high demand and tight vacancy rates. The Sky Harbor submarket, for example, posted a low 6.5% vacancy rate in the third quarter of 2024, compared to the broader Phoenix market’s 12.7%. This strong demand for industrial spaces, coupled with Arizona’s pro-business environment and rapid population growth, has made the region a magnet for institutional investors.
CIP’s acquisition follows a trend of competitive bidding for large-scale industrial properties in the area. The sale underscores the market’s attractiveness as a hub for logistics, manufacturing, and distribution facilities.
A Lucrative Flip for Canyon Partners
The seller, Canyon Partners, acquired Broadway 101 Commerce Park in 2020 for $107.5 million. Their $60.5 million profit reflects the Valley’s rising property values and underscores the benefits of holding industrial assets in high-demand locations.
What’s Next for CIP?
This acquisition is just the beginning for CIP Real Estate in Phoenix. The firm plans to leverage Broadway 101 Commerce Park as a launchpad for expanding its industrial footprint in Arizona. With institutional investors eyeing the market and demand outpacing supply, this move positions CIP for significant growth in the coming years.
Key Takeaways for Investors
The Phoenix metro area, including Mesa, Chandler, and Gilbert, continues to present lucrative opportunities for real estate investors. For those involved in Arizona property management, the region’s industrial sector offers consistent growth potential, while the residential market remains equally dynamic. Whether you’re managing single-family rentals or large commercial assets, staying informed about market trends is essential to maximizing returns.
Conclusion
The $168 million purchase of Broadway 101 Commerce Park is a landmark deal, showcasing the strength of the Phoenix industrial real estate market. For investors, the message is clear: Arizona is the place to be for growth, stability, and long-term value in real estate. As CIP Real Estate begins its Arizona journey, it joins a growing list of firms capitalizing on the state’s thriving economic landscape.