Newport Beach-based CapRock Partners recently started development on what it’s calling the largest speculative industrial real estate project on record for the city of Phoenix.
CapRock is developing a 3.4 million-square-foot industrial warehouse complex on one of the largest remaining infill sites in the Southwest Phoenix submarket.
The eight-building campus will be built in two phases; CapRock is expected to break ground on the first phase in November, which will include five buildings spanning 2.5 million square feet. That phase is expected to wrap by the end of 2022.
The project “will surpass all other large-scale industrial projects within Phoenix’s city limits by more than 1 million square feet,” said Bob O’Neill, senior vice president of acquisitions at CapRock Partners.
“Unmatched in magnitude, location and accessibility, the project will set a new standard for warehouse development in the city of Phoenix, drawing world leaders in distribution, manufacturing and logistics in need of contemporary space to accommodate the region’s remarkable growth.”
The Phoenix region’s industrial market counts a vacancy rate in the 6% range, according to local brokerage data.
CapRock secured the land for the project’s development via a long-term land lease. Financial terms were undisclosed.
Don MacWilliam and Payson MacWilliam of Colliers International represented CapRock Partners in the land transaction for the project, dubbed CapRock West 202 Logistics, and will oversee leasing.
The project is being built on a speculative basis with buildings ranging in size from 228,000 to 1.1 million square feet. Each building can be divided to accommodate multiple tenants.
Development partners include CCA Architects and civil engineer Kimley Horn.
The project adds to a growing Phoenix-area portfolio for CapRock, which has added approximately 3.7 million square feet of industrial product in the area to its investment, development and management portfolio since 2020.
“CapRock West 202 Logistics brings the firm’s total pipeline in the Valley close to 7.5 million square feet,” said Jon Pharris, CapRock co-founder and president.
CapRock’s recent development portfolio includes nearly 16 million square feet of logistics facilities across Arizona, Nevada and California.
Including the new Phoenix project, the firm said it will be developing more than five projects totaling at least 1 million square feet in 2021 and 2022.
On the investment side, the company said it is currently scouting value-add industrial deals between $20 million to $50 million.