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PHOENIX-The Kroger Co. has secured 151,305 sf through a short-term lease at the industrial Riverside Distribution Center. The space represents a relocation and expansion for the Arizona operations for Peyton’s Inc., Kroger’s drug and general merchandise purchasing and distribution subsidiary.

The Cincinnati-based Kroger Co. opted to move into the 503,244-sf Riverside Distribution Center at 4302 W. Buckeye Rd. primarily because of its location, says tenant rep Marc Hertzberg, senior vice president with Grubb & Ellis/BRE Commercial LLC’s Phoenix office. “It’s in the Riverside tax district, which is the southwest industrial corridor’s lowest tax district in the city,” he explains.

He tells GlobeSt.com that the $1.8-million lease also places Peyton’s in a space close to its former facility at 5305 W. Buckeye Rd. Additionally, “Riverside offered a new, state-of-the-art, cross-dock facility with double-wide trailer parking,” Hertzberg notes.

He goes on to say that, with a shortage of class A industrial and distribution product available, Kroger was fortunate to find space at Riverside Distribution Center. “There’s very few choices right now, though a lot of square footage will come on line in 2007,” Hertzberg says. “But right now, the vacancy is so low, and there are few selections to look at, so this was the perfect choice for them.

Tony Lydon with Grubb & Ellis/BRE assisted Hertzberg with tenant representation duties. Pat Feeney and Dan Calihan with CB Richard Ellis’ Phoenix office represented the owners, Ryan Cos. of Phoenix and Tempe-based Suncor Development Co.

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