PHOENIX-Come September, dirt will begin flying on a $38-million flexible industrial project in north Phoenix. The Phoenix office of the Mack Co., a New Jersey-based development firm, is planning a 450,000-sf spec industrial project, the Mack Deer Valley Commerce Center on 40 acres on the east side of 19th Avenue.

“We should get some of the users that you see in the Scottsdale Airpark that don’t want to pay those types of rates or those tenants that are looking for a high-end development that is close to the freeway interchanges,” Mark Becker, a partner with the Mack Co., tells The site is less than a mile from Interstate 17 and a mile north of the newly opened Loop 101. The Deer Valley Airport lies just a half-mile to the northeast of the project site, which is between Deer Valley Road and Rose Garden Lane. Becker says that development costs are somewhere around $85 per sf.

In the project’s first phase, Mack plans to build 44,000-sf and 125,000-sf flex industrial buildings, Becker says. The plans are awaiting city approval.

Last year, Mack purchased 30 acres of the site from Honeywell Corp., which has a major facility just west of the site. That acreage was purchased for $3.60 per sf. Mack is in escrow on the remaining 10 acres, which forms a rectangular piece at the southeast quadrant.

As little as 11,000 sf will be available to lease in the spec buildings. Depending on the tenant improvement allowances, Mack plans to offer the flexible space from 75 cents per sf to $1.10 per sf on a triple net basis.

“There are a lot of businesses going up in the northwest Valley. It is becoming its own area,” Becker says. “There are a lot of rooftops going up. People want to live and work in that area.”

Becker says Cox Communication’s half-built office headquarters that’s up for sale, which is just north of the site, will offer little competition. The two-story office building will attract a completely different kind of tenant than Mack Valley Commerce Center’s target tenant, he says. The Phoenix office of Insignia/ESG, with brokers Ashley Brooks and Bob Lundstedt, is the project’s leasing agent.

The Deer Valley Airport area has become one of the hottest for office and industrial development in the past three years as Loop 101 gets closer to completion. More than a dozen major office and industrial projects have gone up the past year.

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