Portland-based real estate private equity firm Scanlan Kemper Bard Companies (SKB), and a private investment fund managed by Wayzata Investment Partners LLC (Wayzata) through the newly formed City North Associates LLC , closed on a deal Monday to acquire Phoenix development CityCenter of CityNorth. With SKB’s experience in mixed use developments it will put City North Associates in an excellent position to drive activity at the 628,000 square foot mixed-use, luxury project going forward.
CityCenter of CityNorth includes:
99 units (123,000 square feet) of residential condominiums (currently leased as apartments)
- 330,000 square feet of office space
- 175,000 square feet of ground-level retail space
- A six-level parking structure with 1,418 stalls, and an additional 458 surface parking stalls
- 4.9 acres of undeveloped, adjacent land
“CityCenter of CityNorth is an extraordinary real estate asset created by a developer with a reputation for high caliber work,” said Bob Scanlan, principal and CEO of SKB. “The price and quality of the mixed-use development were very attractive to our team, as is the opportunity to participate in the recovery of the Phoenix market.”
The project, developed by Related Companies, was completed in November 2008. CityNorth was foreclosed on in April of 2010, but has seen recent activity with new restaurant, retail and office tenant move-ins during 2012 and the first quarter of 2013.
The development is a part of the Desert Ridge Master Plan, which is currently 50 percent complete. It includes more than 2,400 residential homes and apartments, approximately 2.5 million square feet of office and retail space, The Mayo Clinic medical facility (which occupies 750,000 square feet), the 950-room J.W. Marriott Resort, and the Musical Instrument Museum. Once completed, Desert Ridge is expected to include 50,000 residents and more than 8 million square feet of commercial space.
SKB and Wayzata plan to re-energize CityCenter of CityNorth with attractive tenant improvement allowances in order to drive new leasing activity to the project. In addition, City North Associates will rebrand CityCenter of CityNorth through a marketing strategy aimed at bringing entertainment and service oriented retailers to the project. With its reduced cost basis, City North Associates plans to increase occupancy through highly competitive rents and targeted capital improvements.