Business

Greater Scottsdale Airpark saw fewer employee cars in 2020, increase in larger jets

Posted 3/2/21

The Greater Scottsdale Airpark experienced many of the same pandemic effects faced by other Valley commercial real estate submarkets.

During 2020, retailers, restaurants and hotels struggled with …

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Business

Greater Scottsdale Airpark saw fewer employee cars in 2020, increase in larger jets

A private plane takes off from Scottsdale Airport, which is in the center of the city near Scottsdale Road.
A private plane takes off from Scottsdale Airport, which is in the center of the city near Scottsdale Road.
(Independent Newsmedia/Arianna Grainey)
Posted

The Greater Scottsdale Airpark experienced many of the same pandemic effects faced by other Valley commercial real estate submarkets.

During 2020, retailers, restaurants and hotels struggled with diminished customers. Yet, the submarket grew its jet traffic, becoming home base to five or six more Falcon 7Xs, Falcon 900s and Bombadier Challenger Business Jets, according to a press release.

Airpark landlords took advantage of company employees working from home and used the time to renovate and modernize building public areas, the press release stated.

“This past year has brought paradigm shifts to every realm of life,” said Jim Keeley, founding partner of the Scottsdale office of Colliers Arizona. “The Greater Scottsdale Airpark has been one of the most resilient submarkets in the Valley and continues to hold that position. While the pandemic has created vacancies and sublease space, the impact has been relatively minimal and not impacted rental rates.”

Some Airpark office landlords have offered temporary rent relief, deferring payments to 2021-23. However, Mr. Kelley doesn’t report any significant, hard-hitting downturns in the submarket, the press release stated.

FANG companies (Facebook, Amazon, Netflix and Google) have dominated the commercial real estate market in Greater Phoenix, the press release stated. While the Scottsdale Airpark has not been the site for any of these specific companies, they have nonetheless put a stimulus into the tech industry overall. The Airpark has seen many positive ripple effects of this tech expansion.

The 460,000-square-foot, first phase of Nationwide Insurance’s project was delivered at the northwest corner of Hayden Road and Loop 101. A 50,000-square-foot office building for a tech campus also is under construction.

In October 2020, the Arizona State Land Department auctioned 57.6 acres to Axon, which will be used for construction of the company’s new headquarters in 2021. The ASLD is currently working to auction off 50-100 acre parcels along the Loop 101.

Vacant taxiway access lots are in short supply, so a couple buildings on the east side of the runway are being redeveloped to accommodate larger aviation hangers. The building at 15570 N. 83rd Way is under major reconstruction.

A 23,000-square-foot building sold in 2020 also is being re-purposed into a larger hanger with offices. These renovations of older, functionally obsolete buildings will enhance value to all of the surrounding properties, local officials said.

The pandemic has enhanced companies’ and building owners’ focus on environmental, social and governance issues, the press release stated.

These concerns have been in the forefront for the past five years and have been more of a focus during COVID. As investors look at their portfolios, they have had more time to evaluate these factors.

In addition to these commercial real estate activities, 2020 brought more apartments to the Greater Scottsdale Airpark:

  • The Manor Scottsdale broke ground on 286 units at 13220 N. Scottsdale Road
  • Wood Partners broke ground on 330 units at Alta Raintree
  • 140 Optima Kierland added 213 more units.

The future of pricing for commercial real estate remains elusive pending the outcome of COVID-19 crisis. The employee base is growing in the submarket and companies continue moving here, so Mr. Keeley anticipates a robust, healthy recovery as pandemic conditions diminish, the press release stated.

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