CALL US: 602-296-6200
CALL US: 602-296-6200

Developers turning outdated commercial buildings into more Phoenix housing

 Developers turning outdated commercial buildings into more Phoenix housing

By Audrey Jensen
Reporter, Phoenix Business Journal
Aug 2, 2022

Developers are planning to convert defunct commercial buildings into apartments to bring more residences to the city of Phoenix, which is facing a major housing shortage.

Phoenix-based WeBuild Res started work August 1 on a set of old office buildings in Phoenix on the southeast corner of 31st and Northern avenues for a new complex dubbed Northern Apartments.

The company said it plans to turn the office buildings, which were built in the 1980s, into a $9 million, 38-unit multifamily complex through adaptive reuse, or repurposing the existing structure. Average rents will be around $2 per square foot, with two-bedroom units expected to cost $1,700 monthly. Average units will total about 800 square feet.

WeBuild Res plans to redevelop old office buildings into a multifamily complex near 31st and Northern avenues in Phoenix

The three existing office buildings total 21,000 square feet and will be converted to 26 units with both one and two-bedroom apartments. The company will also construct a new two-story building with 12 one- and two-bedroom units. The complex is expected to deliver by the end of 2023.

“These forgotten office properties provide an on-ramp for our company to compete in a crowded space,” said Blake Curtis, principal of WeBuild, in a statement. “The Phoenix market has a swath of underutilized, vintage office product from the ’70s, ’80s, and ’90s. The existing infrastructure provides cost savings and is an attempt at solving our state’s housing crisis.”

The architect of the project is Jerry Palmer. The final apartment complex will incorporate North Glen Square after the North Glen Square Neighborhood Association.

The company said the project required a rezone of the site from commercial office to residential. It also faced some pushback from residents due to neighboring apartments that are degrading, WeBuild Res said.

RECOMMENDED

The company said this is its second infill office- to-apartment reuse project.

Last year, WeBuild purchased the facility on two acres for $1.3 million from Paradise Promotions, according to real estate database Vizzda.

Hotel conversion

Also in Phoenix, Scottsdale-based Unified CRE Partners LLC is proposing to turn an Embassy Suites by Hilton hotel, which was built in the 1970s, into a new multifamily complex with 200 units. Most will be one-bedroom units, but six of them will have two bedrooms. The facility is located at 2333 E. Thomas Road in east Phoenix.

More of the Valley’s poor-performing or defunct commercial buildings such as offices or hotels are being repurposed for housing following the Covid-19 pandemic, which is also a growing national trend.

As company employees continue working from home, more cities are turning their vacant office buildings in their downtown areas into apartments. From 2019 to 2022, Phoenix saw downtown office vacancy increase from 12.2% to 20.2%, Quartz reported earlier this year.

This year, the Valley is slated to add about 22,000 apartment units and ranked No. 1 for new multifamily projects in the nation, according to a previous Business Journal report.

Since 2012, Arizona’s housing deficit has increased by more than 1,300%, representing 122,683 homes. Arizona currently ranks eighth in the nation for severity of its housing deficit.

https://www.bizjournals.com/phoenix/news/2022/08/02/office-hotel-apartments-phoenix.html

Related post

Subscribe to The Home Front

Fill out the information below to join our newsletter.

This field is for validation purposes and should be left unchanged.