The Tempe Gateway office building, an approximately 264,000-square-foot structure in the Mill Avenue District, has been sold for $66.1 million to the Parkway Properties Inc. in Orlando, Fla.
According to the Phoenix Business Journal, this deal provides "Microsoft co-founder and Seattle Seahawks owner Paul Allen's Vulcan Inc." with a $31.1 million profit after the company originally purchased the foreclosed property in June 2010.
Conversely, the Parkway's purchase provides the company with nearly 788,000 square feet of Class A office space adjacent to US Airways headquarters and near 3rd Street, according to a statement from CBRE Inc. on Wednesday. Essentially, the Parkway now owns over 1.18 million square feet in Phoenix.
"Parkway has experienced exceptional leasing success at its two other Tempe properties, Hayden Ferry Lakeside I and II," Jim Fijan, a broker with CBRE who represented Parkway, said in the statement. "With no new product immediately available and strong demand for class A space in downtown Tempe, Tempe Gateway provides Parkway with additional leasing opportunities in the area and a significant share of the market."
The statement added that this transaction began with an unsolicited offer to purchase the building in the downtown Tempe area. Although Tempe Gateway was lost by its original developer, Opus West Corp., in 2009, the building remained incomplete once the structure was bought by Vulcan Inc. the subsequent year. At this point, the building is 74 percent occupied.