The Phoenix CRE Brief - 3/5/2026

Executive Summary

Three key takeaways from this week's Phoenix commercial real estate activity:

1. Industrial Market Achieves Critical Inflection Point: Colliers reports Phoenix industrial vacancy declined to 9.7% in Q4 2025 (down 10 basis points), with net absorption reaching 18.2 million SF for the year while construction pipeline dropped to 10.6 million SF—the lowest since 2020. CapRock West 202's completion of 825,000 SF across Phase 2 brings the Southwest Phoenix campus to 3.4 million SF total, positioning it as the region's largest speculative development along Loop 202.

2. High-Tech Land Commands Unprecedented Premiums: Mornstair's $59.924M acquisition of 51.983 acres at Mack Innovation Park II ($1.15M per acre, $26.46 per land SF) near TSMC reflects extreme valuations for semiconductor-adjacent land, while institutional capital continues targeting shovel-ready sites with immediate infrastructure access in North Phoenix's advanced manufacturing corridor.

3. Hospitality Sector Expands Across Multiple Segments: The $145M Heritage Tradition senior living sale ($473,856 per unit) represents February's largest metro transaction, while new hotel deliveries span luxury (Denu Hotel's 236-room downtown opening), extended-stay (127-room SpringHill Suites at Mesa Gateway), and boutique segments (168-room AC Hotel in Old Town Scottsdale), demonstrating diversified lodging demand.

Land

Mack Innovation Park II Acquisition Near TSMC Campus - Multiple Sources (February 2026)

Mornstair acquired Lots 2 and 3 at Mack Innovation Park II, a 51.983-acre site at the intersection of 19th Avenue and Pinnacle Peak Road in Phoenix, for $59,924,000. The strategic location within the North Phoenix industrial corridor positions the parcel as critical infrastructure for suppliers and logistics partners associated with the Taiwan Semiconductor Manufacturing Company (TSMC) campus, with the premium price reflecting intense demand for large, contiguous parcels near high-skilled labor pools and major manufacturing projects.

• Land area: 51.983 acres

• Purchase price: $59,924,000

• Price per acre: $1,152,761

• Price per land SF: $26.46

Source

Multifamily

The Residences at Stadium Village Trades for $87.71M - Multiple Sources (February 2026)

Blackstone sold The Residences at Stadium Village, a 382-unit, three-story apartment complex at 16845 N. Stadium Way in Surprise, to AEW Capital Management for $87,710,000. The transaction highlights the liquidity of well-positioned assets in the West Valley's sports and entertainment district, an area that continues to benefit from major expansions surrounding State Farm Stadium and the Arizona Cardinals' new headquarters development.

• Unit count: 382 units

• Purchase price: $87,710,000

• Price per unit: $229,607

Source

Tierra Santa Apartments Transaction - AZBEX (February 24, 2026)

The Tierra Santa Apartments at 4620 W. McDowell Road in Phoenix were involved in a transaction valued at $54,056,000. The 274-unit complex in the central corridor reflects continued investor interest in mid-market multifamily assets with value-add potential in established Phoenix neighborhoods with strong employment access.

• Unit count: 274 units

• Transaction value: $54,056,000

• Price per unit: $197,285

Source

NRP Group Breaks Ground on 353-Unit Medina Station - In Business PHX (February 27, 2026)

The NRP Group closed financing and broke ground on a 353-unit upscale multifamily community within the 60-acre Medina Station master-planned community in Mesa at 10941 E. Southern Avenue. The four-story, elevator-served project will sit on a 10-acre parcel and target families, working professionals and students in the Southeast Valley's fastest-growing corridors, with completion expected in 2028. The development will include studio through three-bedroom units totaling more than 340,000 SF plus six carriage-style buildings.

• Residential units: 353

• Total rentable area: 340,000+ SF

• Expected completion: 2028

Source

The Moreland Affordable Housing Breaks Ground Downtown - Multiple Sources (February 2026)

The Moreland, a 237-unit affordable housing community at 325 E. Moreland Street in downtown Phoenix, has officially broken ground. The public-private partnership is supported by $43.1 million in multifamily housing revenue notes and investment from CVS Health. The first phase will deliver 132 units by late 2027, with 100% of apartments supported by project-based vouchers to serve families earning between 30% and 60% of area median income.

• Total units: 237 (Phase 1: 132 units)

• Financing: $43.1M in revenue notes

• Target income: 30-60% AMI

Source

Industrial

Colliers Q4 2025 Greater Phoenix Industrial Market Report - AZ Big Media (March 3, 2026)

Colliers' Q4 2025 Greater Phoenix industrial report shows metro industrial vacancy falling 10 basis points in the quarter to 9.7%, marking the third consecutive quarterly decline after a prior run of rising vacancies. Net absorption reached 3.2 million SF in Q4 and 18.2 million SF for full-year 2025, while construction under way fell to 10.6 million SF—the lowest since 2020—supporting a healthier balance between new deliveries and tenant demand. Sub-100,000 SF buildings posted only 6.0% vacancy.

• Q4 2025 vacancy: 9.7% (down 10 basis points)

• 2025 net absorption: 18.2M SF

• Under construction: 10.6M SF (lowest since 2020)

• Sub-100K SF vacancy: 6.0%

Source

CapRock West 202 Logistics Completes Phase 2 - Connect CRE (March 2, 2026)

CapRock Partners completed Phase 2 of CapRock West 202 Logistics, delivering 825,000 SF of Class A warehouse space across three buildings on 43 acres in the Southwest Phoenix submarket. With this final phase, the infill logistics campus now totals approximately 3.4 million SF across 183 acres and is described as Phoenix's largest speculative industrial development along the South Mountain Freeway (Loop 202), with Phase 1 reported 85% leased.

• Phase 2 delivery: 825,000 SF (3 buildings)

• Total campus: 3.4M SF on 183 acres

• Phase 1 occupancy: 85% leased

Source

Garmin Acquires 75,000 SF Hangar Complex at Mesa Gateway - AZBEX (February 2026)

Garmin acquired a 75,000-square-foot hangar and office complex at Mesa Gateway Airport, further solidifying the East Valley's status as a strategic aviation corridor. The acquisition reflects Garmin's expansion in the region and the growing importance of Mesa Gateway as a hub for aviation services, maintenance, and aerospace-related industrial activity.

• Building size: 75,000 SF

Source

Retail

Din Tai Fung Announces 10,000 SF Flagship at Scottsdale Fashion Square - In Business PHX (March 2026)

Din Tai Fung announced it will open a 10,000-square-foot, 340-seat flagship restaurant at Scottsdale Fashion Square (7014 E. Camelback Road), marking the Taiwanese brand's first Arizona location. The restaurant will begin a reservation-only soft opening March 12, with phased rollout of takeout, delivery and walk-in service through April and a grand opening scheduled for April 20. The build-out reflects the mall's continued repositioning toward experiential and destination dining uses, expected to generate more than 300 hospitality jobs.

• Restaurant size: 10,000 SF

• Seating capacity: 340 seats

• Job creation: 300+ positions

Source

Busy Bees Child Care Center Trades for $8.8M - AZBEX (March 3, 2026)

A Washington-based investor acquired a 14,800-square-foot freestanding early learning center at 3544 E. Brown Road in Mesa for $8.8 million. The property is leased to Busy Bees Child Care under a 15-year absolute NNN lease. These single-tenant net lease (STNL) assets remain highly sought after by private and institutional investors for their reliable long-term cash flows and essential-service tenant profile.

• Building size: 14,800 SF

• Purchase price: $8,800,000

• Price per SF: $595

• Lease: 15-year absolute NNN

Source

Lakefront at Scottsdale Office-to-Retail Conversion Advances - Hoodline (February 2026)

Diversified Partners is moving forward with "Lakefront at Scottsdale," a redevelopment of an aging office property at 7501 E. McCormick Parkway. The project will convert the existing office building into a waterside dining and boutique retail destination featuring four restaurants. Groundbreaking is targeted for June 2026, leveraging the McCormick Ranch community's extensive 25-mile network of walking and biking paths to drive pedestrian traffic to the new shoreline amenities.

• Planned restaurants: 4

• Expected groundbreaking: June 2026

Source

Office

Silver Creek Acquires Rio Yards, Rebrands as Horizon Bay - Connect CRE / AZBEX (February 24, 2026)

Silver Creek Development purchased the Rio Yards Class A office building at 1337 E. Rio Salado Parkway within the Novus Innovation Campus in Tempe, rebranding it as Horizon Bay. The 150,000-square-foot property, delivered in 2023, was acquired with the transaction facilitated by Brian Ackerman of Colliers on behalf of the seller, Wentworth Development Co. The purchase was backed by a $32.3 million loan, with new ownership planning to add extensive collaborative workspaces, training rooms, and indoor/outdoor cafes.

• Building size: 150,000 SF

• Year built: 2023

• Loan amount: $32.3M

Source

Pima I and II Office Buildings Trade in Scottsdale - AZBEX (February 24, 2026)

JLL Capital Markets completed the sale of Pima I and II, located at 8415 and 8465 N. Pima Road in Scottsdale. Cypress West Partners acquired Pima I, while a private investor purchased Pima II. The transactions demonstrate the resilience of suburban medical and professional office space in the Scottsdale corridor, where well-located assets continue to attract both institutional and private capital.

• Location: 8415 and 8465 N. Pima Road, Scottsdale

Source

Hayden Ferry Lakeside I Signs Two Major Leases - AZBEX (March 3, 2026)

At Hayden Ferry Lakeside I in Tempe, Meade Engineering and Align Technology each signed leases for approximately 52,000 square feet. The 10-story Class A building at 80 E. Rio Salado Parkway continues to be one of the most desirable office addresses in the East Valley due to its proximity to urban amenities, Tempe Town Lake, and major transportation arterials.

• Meade Engineering lease: ~52,000 SF

• Align Technology lease: ~52,000 SF

Source

Mixed-Use

Vintage Partners Pivots 63-Acre Site to Mixed-Use Community - AZBEX (February 2026)

Vintage Partners is re-envisioning a 63-acre parcel on Phoenix's west side—originally targeted for data center use—as a high-density mixed-use community following changes in the city's data center siting policies. The developer is requesting City of Phoenix entitlement for approximately 1,000 residential units (including single-family attached and multifamily) alongside 22 acres of commercial, retail, restaurant and service uses. The site, bounded by Lower Buckeye Road, Loop 202, and 63rd Avenue, targets densities around 43.5 units per acre.

• Total site: 63 acres

• Residential units: ~1,000

• Commercial/retail: 22 acres

Source

Phoenix Proposes Transit-Oriented Development at 19th Avenue & Dunlap - AZBEX (February 2026)

The city is facilitating the redevelopment of a 12.37-acre site at the southwest corner of 19th Avenue and Dunlap Avenue in South Phoenix. Planners are proposing a rezoning to "Walkable Urban Code," which would allow for high-density R-5 multifamily residential units alongside restricted commercial uses. This initiative aims to transform a site that has been underutilized since the extension of the light rail, creating a transit-oriented hub near the Thelda Williams Transit Center.

• Site size: 12.37 acres

• Proposed zoning: Walkable Urban Code (high-density R-5)

Source

Gilbert Heritage District South Anchor Site Acquired - AZBEX (January 6, 2026)

KDG Heritage South Anchor LLC purchased a 2.75-acre site at the northwest corner of Gilbert and Elliot roads from the Town of Gilbert for $4.6 million. The land is slated for the South Anchor mixed-use development, which will further enhance the walkability and retail density of Gilbert's Heritage District, one of the Southeast Valley's premier urban village concepts.

• Land area: 2.75 acres

• Purchase price: $4,600,000

• Price per acre: $1,672,727

Source

Palo District Plans Two Hotels Totaling 600 Rooms - Connect CRE (March 2026)

Sunny Day Sports advanced its vision for the Palo District, an 80-acre redevelopment of the former Fiesta Mall site in Mesa, with new disclosures that the plan now includes two hotels totaling roughly 600 rooms. Early concepts call for a 400-room full-service hotel adjacent to a planned sports stadium—potentially the largest hotel in Mesa and the East Valley—plus a 200-room higher-end extended-stay property. Both hotels are targeted to open in early 2028, supporting the district's positioning as a national destination for women's health, elite athletics and innovation.

• Hotel 1: 400 rooms (full-service)

• Hotel 2: 200 rooms (extended-stay)

• Expected opening: Early 2028

Source

Hotels

Heritage Tradition Senior Living Sells for $145M - Multiple Sources (February 2026)

Blackstone sold Heritage Tradition, a 306-unit assisted living facility in Sun City West, to AEW Capital Management for $145 million. This transaction represents the single largest commercial real estate deal reported in Metro Phoenix for February and highlights the sustained institutional appetite for high-quality senior living assets. The property was ranked among the nation's best senior living facilities.

• Unit count: 306 units

• Purchase price: $145,000,000

• Price per unit: $473,856

Source

AC Hotel Scottsdale Old Town Opens - Multiple Sources (March 2026)

PEG Cos. opened the AC Hotel Scottsdale Old Town, a six-story, 168-room AC Hotels by Marriott property at 7117 E. 3rd Avenue in Scottsdale. The hotel features the brand's AC Lounge and AC Kitchen, a 24/7 fitness center, rooftop pool, meeting and event space, a three-level underground parking garage and pet-friendly accommodations. The rooftop Cielito bar and restaurant adds a 70-seat food-and-beverage venue to Old Town's hospitality offering.

• Rooms: 168

• Stories: 6

• Rooftop venue: Cielito bar (70 seats)

Source

Denu Hotel & Spa Opens Reservations for September Launch - AZBEX (February 27, 2026)

The Denu Hotel & Spa, a 17-story, 236-room luxury hotel at 1 E. Adams Street in downtown Phoenix, has officially opened reservations for its upcoming launch. Managed by Pacific Hospitality Group under The Meritage Collection, the property features 23,000 square feet of meeting space and is expected to open in September 2026. This luxury addition addresses the growing demand for high-end hospitality within the urban core's corporate and convention ecosystem.

• Rooms: 236

• Stories: 17

• Meeting space: 23,000 SF

• Expected opening: September 2026

Source

SpringHill Suites Breaks Ground at Mesa Gateway - AZBEX (February 27, 2026)

Boyer Company has broken ground on a five-story, 127-suite SpringHill Suites by Marriott at the Mesa Gateway Airport area. The project is part of the Gateway East development and will include an additional 17,000 square feet of retail and restaurant space, supporting the East Valley's booming aviation and logistics corridor.

• Rooms: 127 suites

• Stories: 5

• Additional space: 17,000 SF retail/restaurant

Source

Fire N Ice Hotel Construction Reaches Halfway Point - Phoenix IDA (February 24, 2026)

The Fire N Ice Hotel in North Phoenix is currently under construction on a 3.7-acre campus, with the 96-room property more than halfway complete. The project is part of a larger high-impact development that includes a sports-based high school and athletic arena, supported by $15.2 million in hotel revenue bonds issued by the Phoenix IDA.

• Rooms: 96

• Site size: 3.7 acres

• Financing: $15.2M in hotel revenue bonds

Source

This digest is compiled for informational purposes and reflects publicly reported commercial real estate activity in the Phoenix metropolitan area.