TaB will use the building to warehouse chocolate products. The 217,000-sf warehouse, developed by Opus West Corp., is situated at the southeast corner of 84th Avenue and Washington Street.
The Phoenix suburb of Tolleson, of late, has become a haven for large distribution and warehouse buildings. "Like its neighboring tenants, TaB will benefit from this project's convenient location to Interstate 10," says Jeff Roberts, Opus West's senior director of real estate.
Opus West's development is positioned about a mile south of Interstate 10, one of the major thoroughfares in the Valley and the primary artery to Los Angeles. The project is also about two miles southeast of the interchange to the Agua Fria Freeway section of the Loop 101, which runs through the West Valley and connects with Interstate 17 in north Phoenix.
Durasol Awnings, a leading manufacturer of residential product, is already up and running in the building. The two leases take the building to 53% occupancy. The first phase, a 220,000-sf warehouse, is fully lease to Bose Corp., which uses the site as its primary distribution center.
The Valley's southeast corridor is one of the region's hardest hit by the nationwide economic slowdown. At midyear point, the submarket had more than 660,000 sf of negative net absorption. Industrial vacancy now stands at 12.6%, that's 5.4% greater than the rest of the Valley. Just in the past six months, more than 2.5 million sf has delivered. "There isn't enough tenant activity to fill it up," says Don MacWilliams, a broker with the Phoenix office of Insignia/ESG. He and Payson MacWilliams are the listing agents for Tolleson Commerce Park Phase II. "The way the economy is right now everything has slowed down."
The rapid pace of absorption 1 1/2 years ago in the southeast Phoenix area prompted a wave of distribution development, but since then demand has nosedived. While rates have not dropped significantly, MacWilliams tells GlobeSt.com, some developers are offering increased tenant improvement budgets and months of free rent, some as long as three months with a five-year lease.
Opus West Corp, based in Phoenix, has been one of the most active office and industrial developers in the West for the past decade. Since Opus West opened its office in 1979, it has developed more than 20 million sf of office, industrial and retail product. The firm is part of the Opus Group of Cos.
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