The Hayden Ferry Lakeside property has been sold, in what is the third major land transaction to take place recently in Tempe’s Mill Avenue District.
The deal came just after the University Square block at University Drive and Myrtle Avenue changed hands, and weeks after Microsoft co-founder Paul Allen snapped up an eight-story office building.
The trio of sales coincides with an increase in leasing downtown office space and shops, said Sheri Wakefield-Saenz, the city’s community development manager.
“I would say it’s a very good indicator that we’re well on our way to some recovery in Tempe,” Wakefield-Saenz said.
The Hayden Ferry Lakeside property spans the south side of Tempe Town Lake, from Mill Avenue to Rural Road. It was sold by its original developer, SunCor, to Scottsdale-based Sunbelt Holdings. The deal included several Valley developments owned by SunCor, which decided to sell many of its properties because of the real estate slump. The price was not disclosed.
Sunbelt wanted Hayden Ferry Lakeside for its potential when the economy recovers, president and CEO John Graham said.
“We bought it because we think it’s a very key location and has a very good future,” he said.
The deal includes 16 acres and an option to develop 15 acres now owned by Arizona State University. Sunbelt also bought the 2,500-space parking garage and 25,000 square feet of retail space attached to that structure. The sale did not include the west end of the project, where SunCor built two office towers and two condo buildings.
Sunbelt will look to SunCor’s master plan for a hotel and more condo and office towers before considering any alterations, Graham said. The company will clean up the vacant land for now, but any major work will wait until demand returns.
“In light of the commercial market, it is at least a few years away,” Graham said.
Another significant sale is the University Square property, a full block on University Drive where 3W Companies won approval for a 300-foot-tall cluster of offices, condos and a hotel. Tuscon-based Sundt Construction paid $10.13 million for the site of slightly more than three acres.
The block was once full of businesses, but 3W tore down all but one low-slung slump block building in preparation for construction. The plans stalled at the front end of the real estate crash.
Sundt plans to demolish the sole building and turn the block into a parking lot, Wakefield-Saenz said.
“Their immediate intent is to clean up the site and reduce some of the visual blight that’s there now,” she said.
Sundt plans to have the parking lot ready when the fall semester begins in August. The company will evaluate development plans as the economy recovers, Wakefield-Saenz said.
The other major downtown transaction involved Seattle-based Vulcan Real Estate buying the eight-story Tempe Gateway tower at Mill and Third Street. Microsoft’s Allen paid $35 million and is actively trying to lease a building that’s sat idle since Phoenix-based Opus completed the tower a year ago. Opus filed for bankruptcy protection at the time. No leases have been announced since the June sale.
However, Tempe has seen a fairly active interest in leasing downtown properties since about May, Wakefield-Saenz said.
“It’s another good step in the recovery,” she said.