A major Valley developer has set its sights on Mill Avenue with plans to build an eight-story office building on the US Airways headquarters campus in downtown Tempe.
The $70 million project — called Tempe Gateway — will sit on 3.5 acres at the northwest corner of Mill Avenue and Third Street just north of a future light-rail stop.
Under development by Opus West Corp., Gateway is part of a long-standing agreement by the city and the airline to build out the site.
“We’re happy to do it,” US Airways spokesman Morgan Durrant said. “The city’s been good to us.”
The airline has no plans to open offices in the building, which will include 235,000 square feet of offices and 25,000 square feet of retail space. Plans also call for more than 1,000 parking spaces at the site.
The Gateway project will connect Mill Avenue to Tempe Town Lake for
pedestrians and create another opportunity for companies searching for office space, said Sheri Wakefield-Saenz, Tempe’s economic development director.
“Office vacancy in Tempe is in the single digits,” she said. “There’s significant demand for corporate users.”
A building of that size could fit 350 to 1,000 employees, depending on what types of businesses come in, Wakefield-Saenz said. It’s also one of several major projects in the works along the light-rail line, she said.
Opus West was one of at least a few development companies that made proposals to US Airways last year, said Jeff Roberts, vice president of real estate development for the company.
Tempe has become an emerging submarket for highend office buildings in recent years with its increasing number of shops and restaurants, along with the completion of the nearby portion of Loop 202, Roberts said.
It’s also become a nice alternative to the Camelback corridor, where little space remains to build, he said.
Opus West plans to start construction of the Gateway project in the fall and open in late next year or early 2009.