Luhrs City Center

[Jjs5056]

Originally Posted by pbenjamin

Actually, downtown has one of the lowest vacancy rates in the area. Some of it is due to GPLETs making rental costs relatively low. There are instances of firms abandoning midtown, which has a much higher vacancy rate in favor of cheaper rent downtown.

http://www.bizjournals.com/phoenix/n...ate-at-26.html

The problem is exactly as you've stated - downtown just continues to cannibalize other Central Phoenix companies. New developments simply target those with leases ending in the hope that they'll want newer, Class A space vs. extending their current lease. Downtown office market is really just a game of tower-to-tower hopping; see Lewis and Rocha's move to BofA, Phoenix School of Law moving from midtown to Phelps Dodge, etc. And, the slew of law firms at CityScape certainly weren't all new to the market, either.

While that's great that downtown has a low vacancy rate, there are only so many firms we can lure from midtown before that area is just completely abandoned. Companies, especially new or expanding ones, have made clear that the Scottsdale Airpark, Chandler, Camelback/24th and Tempe are considerably more favorable areas for their operations.

I think it's slightly irresponsible to bring much more office space to the downtown market until entities like ACA, DPP, etc. do their jobs and bring new corporations to downtown from out of state - or, at the very least, from non-centralized locations. Otherwise, we'll see buildings like 111 Monroe dry up while new high rises fill; what good does that do? Vacant retail along 1st Ave and Monroe does nothing to help create the dense, vibrant downtown we all want. Shiny new towers are great, but they're great when they are needed and the economics support them.

Lastly, it's time to think of midtown as an extension of downtown. The light rail has connected the two, and the health of one does have an impact on the other. Almost all residential proposals in the works have been for the midtown area, and activity clusters around Thomas, McDowell, and Roosevelt really blur the lines between downtown and midtown. Turning midtown into a ghost town is not in the best interest of central Phoenix as a whole, so again - the strategy of stealing business from that area to support downtown growth just isn't good for the long-term success of the urbanized area of the city. Midtown may not ever see demand for new office tower development, but properly ugrading and renovating some (see: Thomas/Central and adding Central Ave-facing retail) to keep firms in place while activating the area, and adaptively reusing others that have been essentially evacuated (see: The Newton, or The Edison at Lewis/Central; it's a new-build and not reuse, but same idea), is a much sounder strategy.

[PHXFlyer11]

Originally Posted by Jjs5056

The problem is exactly as you've stated - downtown just continues to cannibalize other Central Phoenix companies. New developments simply target those with leases ending in the hope that they'll want newer, Class A space vs. extending their current lease. Downtown office market is really just a game of tower-to-tower hopping; see Lewis and Rocha's move to BofA, Phoenix School of Law moving from midtown to Phelps Dodge, etc. And, the slew of law firms at CityScape certainly weren't all new to the market, either.

While that's great that downtown has a low vacancy rate, there are only so many firms we can lure from midtown before that area is just completely abandoned. Companies, especially new or expanding ones, have made clear that the Scottsdale Airpark, Chandler, Camelback/24th and Tempe are considerably more favorable areas for their operations.

I think it's slightly irresponsible to bring much more office space to the downtown market until entities like ACA, DPP, etc. do their jobs and bring new corporations to downtown from out of state - or, at the very least, from non-centralized locations. Otherwise, we'll see buildings like 111 Monroe dry up while new high rises fill; what good does that do? Vacant retail along 1st Ave and Monroe does nothing to help create the dense, vibrant downtown we all want. Shiny new towers are great, but they're great when they are needed and the economics support them.

Lastly, it's time to think of midtown as an extension of downtown. The light rail has connected the two, and the health of one does have an impact on the other. Almost all residential proposals in the works have been for the midtown area, and activity clusters around Thomas, McDowell, and Roosevelt really blur the lines between downtown and midtown. Turning midtown into a ghost town is not in the best interest of central Phoenix as a whole, so again - the strategy of stealing business from that area to support downtown growth just isn't good for the long-term success of the urbanized area of the city. Midtown may not ever see demand for new office tower development, but properly ugrading and renovating some (see: Thomas/Central and adding Central Ave-facing retail) to keep firms in place while activating the area, and adaptively reusing others that have been essentially evacuated (see: The Newton, or The Edison at Lewis/Central; it's a new-build and not reuse, but same idea), is a much sounder strategy.

While true, I think the bigger issue is the lack of housing downtown. I'm not sure how high demand is for housing, but it's safe to say that the leaders of most companies live in North Scottsdale or Paradise Valley. I believe few have interest in commuting to downtown Phoenix. This is a major hurdle and a reason why we see so many companies in suburban parks on the east side.

If there were more people living downtown, demand for office space downtown would rise. More people would want to live closer to where they work. This is by no means a easy problem to solve, and I understand that, I'm just pointing out the lack of housing downtown does not help one bit.

I think Tempe is thriving more because of ASU and it's central location relative to the east valley.

Downtown Phoenix is closer to the west side, which I believe has fewer whit collar workers and more residents in the service industry, public sector, transportation, warehousing and construction.

[KevininPhx]

Originally Posted by pbenjamin

Actually, downtown has one of the lowest vacancy rates in the area. Some of it is due to GPLETs making rental costs relatively low. There are instances of firms abandoning midtown, which has a much higher vacancy rate in favor of cheaper rent downtown.

http://www.bizjournals.com/phoenix/n...ate-at-26.html

Do you know that's a two-year-old article? You may be right. But this isn't a good source to prove your point.

[KevininPhx]

Originally Posted by Jjs5056

The problem is exactly as you've stated - downtown just continues to cannibalize other Central Phoenix companies. New developments simply target those with leases ending in the hope that they'll want newer, Class A space vs. extending their current lease. Downtown office market is really just a game of tower-to-tower hopping; see Lewis and Rocha's move to BofA, Phoenix School of Law moving from midtown to Phelps Dodge, etc. And, the slew of law firms at CityScape certainly weren't all new to the market, either.

While that's great that downtown has a low vacancy rate, there are only so many firms we can lure from midtown before that area is just completely abandoned. Companies, especially new or expanding ones, have made clear that the Scottsdale Airpark, Chandler, Camelback/24th and Tempe are considerably more favorable areas for their operations.

I think it's slightly irresponsible to bring much more office space to the downtown market until entities like ACA, DPP, etc. do their jobs and bring new corporations to downtown from out of state - or, at the very least, from non-centralized locations. Otherwise, we'll see buildings like 111 Monroe dry up while new high rises fill; what good does that do? Vacant retail along 1st Ave and Monroe does nothing to help create the dense, vibrant downtown we all want. Shiny new towers are great, but they're great when they are needed and the economics support them.

Lastly, it's time to think of midtown as an extension of downtown. The light rail has connected the two, and the health of one does have an impact on the other. Almost all residential proposals in the works have been for the midtown area, and activity clusters around Thomas, McDowell, and Roosevelt really blur the lines between downtown and midtown. Turning midtown into a ghost town is not in the best interest of central Phoenix as a whole, so again - the strategy of stealing business from that area to support downtown growth just isn't good for the long-term success of the urbanized area of the city. Midtown may not ever see demand for new office tower development, but properly ugrading and renovating some (see: Thomas/Central and adding Central Ave-facing retail) to keep firms in place while activating the area, and adaptively reusing others that have been essentially evacuated (see: The Newton, or The Edison at Lewis/Central; it's a new-build and not reuse, but same idea), is a much sounder strategy.

I'm not advocating this (or vice versa). I'm just saying it's what happens. Which is exactly what happens in every city in America. In NYC (you're from there?), ad agencies that once were all over midtown have been moving downtown the past decade - into new buildings. Wall Street firms have been moving in the opposite direction.

My point is simply that if someone built an office tower downtown, it would fill up.

[Jjs5056]

Originally Posted by KevininPhx

I'm not advocating this (or vice versa). I'm just saying it's what happens. Which is exactly what happens in every city in America. In NYC (you're from there?), ad agencies that once were all over midtown have been moving downtown the past decade - into new buildings. Wall Street firms have been moving in the opposite direction.

My point is simply that if someone built an office tower downtown, it would fill up.

Of course. But, in most other cities, they are able to attract new companies to fill the vacant space - startups, firms from other cities/states, expansions, etc. That isn't the case for Central Phoenix.

I don't disagree that a tower might fill up with companies abandoning Class B space, and my thoughts aren't aimed at you. I just disagree with the general notion - and again, this isn't aimed at anyone - that the downtown office market is healthy, when midtown and other central submarkets are such a mess. The two are not mutually exclusive, and it's important for both to be successful, which will take a concerted effort to bring new business to the area. It sucks that planning mistakes made 50 years ago are still impacting the city center, but it's reality.

Originally Posted by PHXFlyer11

While true, I think the bigger issue is the lack of housing downtown. I'm not sure how high demand is for housing, but it's safe to say that the leaders of most companies live in North Scottsdale or Paradise Valley. I believe few have interest in commuting to downtown Phoenix. This is a major hurdle and a reason why we see so many companies in suburban parks on the east side.

If there were more people living downtown, demand for office space downtown would rise. More people would want to live closer to where they work. This is by no means a easy problem to solve, and I understand that, I'm just pointing out the lack of housing downtown does not help one bit.

I think Tempe is thriving more because of ASU and it's central location relative to the east valley.

Downtown Phoenix is closer to the west side, which I believe has fewer whit collar workers and more residents in the service industry, public sector, transportation, warehousing and construction.

I think you have it a bit backwards. People want to live close to where they work - yes. That's why there is demand in areas like North Scottsdale (Optima development, Scottsdale Quarter, tons of infill downtown, etc.), Tempe, and so on.

Without a strong economic base, there won't be that demand. People aren't going to move downtown with the assumption that their job will follow them. And, right now, the economic base of downtown is stagnant and the immediate future doesn't look so bright with the Biomedical Campus taking a hit due to the expansion of a second one near Mayo. The residential demand, of which there doesn't seem to be much since nothing has been developed since Roosevelt Point, is largely driven by the student population and those that want to be closer to the growing arts scene.

If you're simply saying that you think housing is more important to downtown's success than office development; sure, I agree. But, with no plan for economic growth, and tons of land that is either filled with parking/dirt or private ASU/Biomedical buildings, I don't know how it would be supported. That's why the small proposals we are seeing are in Midtown closer to Camelback, McDowell, and Roosevelt where there is at least some semblance of urban life.

[pbenjamin]

Originally Posted by KevininPhx

Do you know that's a two-year-old article? You may be right. But this isn't a good source to prove your point.

Sorry. I read something similar in the Republic within the last week or so and went looking for it. That obviously wasn't it. This one is from this month and says more or less the same, number-wise.

http://www.bizjournals.com/phoenix/n...main-high.html

[nickw252]

The City issued the building permit for the hotel on 10/20/14:

Permit # BLD T622399

DESCRIPTION OF WORK: NEW 19 STORY HIGHRISE HOTEL; TYPE 1A *(TYPE IB SUBSTITUTION IBC 403.3) GROUP R1 HOTEL-PRIMARY
OCCUPANCIES INCLUDING GUEST ACCOMODATION, A-3 (POOL DECK ASSEMBLY AREA), A-2 (MEETING AND DINING ROOMS), B
(GENERAL OFFICE AND BACK-OF-HOUSE SUPPORT AREAS), BASEMENT LEVEL (MECHANICAL EQUIPMENT) H3 GENERATOR FUEL STORAGE.
THE PROJECT IS BEING DEVELOPED ON A 41,512 SF LOT (0.953 ACRES).

PARKING IS PROVIDED IN THE ADJACENT 5 STORY PARKADE STRUCTURE LOCATED AT 130 S. 1ST AVENUE. THE MAIN HOTEL ENTRANCE IS AT
THE GROUND LEVEL ON MADISON STREET SIDE

[gymratmanaz]

Wonder when it might start?

[Tempe_Duck]

Originally Posted by nickw252

The City issued the building permit for the hotel on 10/20/14:

Permit # BLD T622399

DESCRIPTION OF WORK: NEW 19 STORY HIGHRISE HOTEL; TYPE 1A *(TYPE IB SUBSTITUTION IBC 403.3) GROUP R1 HOTEL-PRIMARY
OCCUPANCIES INCLUDING GUEST ACCOMODATION, A-3 (POOL DECK ASSEMBLY AREA), A-2 (MEETING AND DINING ROOMS), B
(GENERAL OFFICE AND BACK-OF-HOUSE SUPPORT AREAS), BASEMENT LEVEL (MECHANICAL EQUIPMENT) H3 GENERATOR FUEL STORAGE.
THE PROJECT IS BEING DEVELOPED ON A 41,512 SF LOT (0.953 ACRES).

PARKING IS PROVIDED IN THE ADJACENT 5 STORY PARKADE STRUCTURE LOCATED AT 130 S. 1ST AVENUE. THE MAIN HOTEL ENTRANCE IS AT
THE GROUND LEVEL ON MADISON STREET SIDE

Is this the glass building featured in the recent render or the ugly one behind it?

[nickw252]

Originally Posted by Tempe_Duck

Is this the glass building featured in the recent render or the ugly one behind it?

Neither.

It will be on the southeast corner. You could not see it in those pictures. Those two buildings were on the west side of that block. Those two buildings will probably never be built.

[NIXPHX77]

Serious demolition work tonight. SEC of the building is gone.

[Jackdavis4]

Looks like demolition is coming to a completion, anyone know if they are starting construction immediately after?

[CrestedSaguaro]

The Luhrs website has had a major overhaul and now the below rendering is on the "Future" tab. Is there possibly any reality for this tower to actually happen?

Strange that this rendering is being featured, but they have yet to release the full rendering of the 19 story Marriott. Would like to see that.


http://www.luhrscitycenter.com/future/

Originally Posted by RonnieFoos

Check out the Luhrs rendering on ACRM's website! I have not heard of anything about 26 and 33 story towers planned for Luhrs, but the rendering was posted only 4 days ago. Anyone know about this?


http://www.acrma.com/portfolios/hospitality/

[PHXFlyer11]

Originally Posted by RonnieFoos

The Luhrs website has had a major overhaul and now the below rendering is on the "Future" tab. Is there possibly any reality for this tower to actually happen?

Strange that this rendering is being featured, but they have yet to release the full rendering of the 19 story Marriott. Would like to see that.


http://www.luhrscitycenter.com/future/

Not this rending again! It is complete garbage. We speculated before when we originally saw this that they will develop the first tower then try to flip the entire project to an investor. I believe the other tower is just shown to try and drive up the property value when it sells. I don't think they actually have this tower planned.

[PHXFlyer11]

Originally Posted by Jackdavis4

Looks like demolition is coming to a completion, anyone know if they are starting construction immediately after?

I drove by today. Very difficult to tell. There is a huge hole in the ground and you can see 2-3 floors down into a basement/garage. Hard to say if it solely demo or if new footings are going in to support the tower.

Either way, they cannot leave the massive hole i saw, so i'd say construction has started or will start right after. There was definitely heavy equipment and work being done.

I really hope the Buchanan project starts soon.

[PHXFlyer11]

Originally Posted by RonnieFoos

The Luhrs website has had a major overhaul and now the below rendering is on the "Future" tab. Is there possibly any reality for this tower to actually happen?

Strange that this rendering is being featured, but they have yet to release the full rendering of the 19 story Marriott. Would like to see that.


http://www.luhrscitycenter.com/future/

Interesting the page was alsp updated to say the Marriott will open on 2016 and...

"The Hansji Corporation has partnered with Tallwave, a Scottsdale-based business accelerator, to bring Downtown Phoenix a revolutionary way for technology startups to establish a solid footing in the Arizona marketing, and grow responsibly and successfully. Details on the partnership will be unveiled in 2015."

While this is good news, Tallwave is a very small company and i doubt the tower is for them. Maybe they are taking some of the existing space for an incubator.

[Jjs5056]

It's a shame that the retail at Luhrs has struggled to lease; especially now with Bitter and Twisted open, you would think at least some of the momentum would carry over. They've tossed several good ideas around for the middle spaces, such as holding out for restaurants, or combining the spaces to create a marketplace, etc. but they're still all up and listed. I wonder how much better they'd be doing if CityScape had a row of restaurants facing them or at least patios vs. the loading bays and garage ramps?

I hope that whatever partnership that is, that it doesn't mean any of the ground level space will be leased to them... there are already too many incubators going in on the ground level of buildings and 9-5 businesses should go on upper floors IMO.

Currently, the only permit open for Luhrs City Center is a shoring permit, which sounds to me like it's for essentially leveling out the lot.

And re: the Buchanan project - assuming you mean Ballpark Apartments, I almost hope that project falls through. I want residential development to happen badly in the Warehouse District, but they're demolishing one warehouse that I think could be salvaged into something cool (the produce one at the tracks), and they're turning Gerardo's and Fresno Groceries - two of the last beautiful buildings in the District - into the complex fitness center and leasing office. I think for the Warehouse District to take off, the warehouses need to be rehabbed and become accessible structures to the public to see firsthand the history behind them, and how work is being done to transform and bring them back to life. Using them for a private apartment complex or a 9-5 business provides no benefit to that community's identity. Not everything has to be as awesome as The Duce, but simple galleries and cafes would go a lot further into creating something special.

[dtnphx]

More on the Tallware Technology in the Luhr's Tower.

Tech, innovation hub planned for downtown Phoenix's Luhrs City Center

[combusean]

The irony of Luhrs struggling to lease its ground floor is not lost on me--about 9 years ago it was full. Granted one was a bail bonds store, but I seem to recall there was also a flooring place, a florist, and one of the cheapest chinese food joints ever (it wasn't very good, but a good neighborhood needs a range of options). These things actually served the neighborhood, rather than tried to create a destination.

A trendy cocktail bar with the rest empty is I guess the price we will pay temporarily for its gentrification--esp with the Luhrs Central Building now demolished--and I hope downtown's staggered momentum improves somewhat and results in Luhrs' full occupancy.

Sigh.

[pbenjamin]

Originally Posted by combusean

The irony of Luhrs struggling to lease its ground floor is not lost on me--about 9 years ago it was full. Granted one was a bail bonds store, but I seem to recall there was also a flooring place, a florist, and one of the cheapest chinese food joints ever (it wasn't very good, but a good neighborhood needs a range of options). These things actually served the neighborhood, rather than tried to create a destination.

A trendy cocktail bar with the rest empty is I guess the price we will pay temporarily for its gentrification--esp with the Luhrs Central Building now demolished--and I hope downtown's staggered momentum improves somewhat and results in Luhrs' full occupancy.

Sigh.

Some years back there was a Schlotzky's where Bitter and Twieted is now.