JLL Income Property Trust Acquires Two-Building Office Portfolio in Phoenix
February 11, 2020
CHICAGO, Feb. 11, 2020 /PRNewswire/ — JLL Income Property Trust, an institutionally managed daily NAV REIT (NASDAQ: ZIPTAX; ZIPTMX; ZIPIAX; ZIPIMX), today announced the acquisition of Fountainhead Corporate Park, a 300,000 square foot, two-building Class A office portfolio comprised of two 6-story buildings located in the Phoenix, Arizona submarket of Tempe. The property was acquired for $61.5 million, or approximately $205 per square foot, representing a significant discount to new construction costs in the Phoenix market.
Arizona’s economy ranks 2nd in the nation for job growth, 3rd in the nation in GDP growth, and 4th in fastest growing states in the US. Nearly 300,000 jobs have been added in Arizona since 2015, with expectations to create an additional 70,000 jobs in 2020. Phoenix’s vibrant economy, affordable housing market, and young cultural base have led to an influx of technology and financial companies from the west coast earning the area the title of “The Silicon Desert”. According to Green Street Advisors, the Phoenix office market is ranked 4th nationally for estimated demand and employment growth from 2019 to 2022. Tempe is Phoenix’s top performing office submarket posting vacancy rates in the single digits over the past 8 years and hitting an all-time low of 3.3% in 2019.
Fountainhead Corporate Park is part of a dynamic live-work-play environment with a high-profile location along I-10 with immediate access to US-60, SR-143, Loop 202, Sky Harbor Airport, downtown Tempe and Arizona State University’s campus. The property is located within a master-planned environment that contains Class A office space, multifamily communities, retail and hotels. It is leased to a diversified mix of investment-grade tenants such as First American Title Company, State Farm Insurance and Coca Cola, as well as financial institutions, engineering firms, tech companies and academic institutions with a weighted average lease term of over five years. Both buildings benefit from a recent major capital refurbishment program that included renovations of lobbies, common areas, elevators and roof replacements that exceeded $4.5 million of capital improvements.
