Estrella Gin Business Park still without a tenant

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Matt Jensen of The Boyer Company shares the latest information on the Estrella Gin Business Park.

It is an understatement to say the development of Estrella Gin Business Park has been a long process full of the unexpected.

A series of delays just to build an access road has been part of the frustration. Equally exasperating has been the slow process of finding appropriate tenants.

“The location is great. It’s a clean slate to work with,” said Matt Jensen, a partner in The Boyer Company, a development company that contracted with the City of Maricopa to find businesses for the location. “There is incredible community interest in it.”

An Oct. 27 open house for Estrella Gin Business Park drew dozens of Maricopans to City Hall to hear the latest.

“It was a great turnout. We’ve still got to get people to commit,” Jensen said.

Boyer’s agreement with the city has a pre-leasing threshold of 60-percent to be met before construction. But that number could be flexible.

“It depends on the type of tenants we get,” Jensen said. “If they are good-quality, established companies, we would feel more comfortable starting earlier with maybe 50 percent.”

Beyond delays in the construction of the Edison Road extension (its connection to State Route 238 has been postponed until January), The Boyer Company faces other challenges with the 52-acre property.

“The challenge is who to market to,” Jensen said. “Obviously, you want to reach out to the businesses in Maricopa, but the majority of them are retail-based. That’s not our intent. And I don’t know if it’s realistic to expect an established company to pull out of Chandler and move here.”

The Boyer Company is a Salt Lake City-based, family-owned business. It has worked on projects in Arizona for 20 years. The company signed onto the project in 2012 when there was no road, no water and no zoning. The objective for Estrella Gin was to “offer a first-class project that is price-competitive.”

Pricing

The base lease rate is 74 to 79 cents per square foot per month. That is $8.80 to $9.40 per square foot a year, “so it’s cheaper than what we talked to you about,” Jensen told the gathering of business owners and elected officials at the open house.

The previous cited number was over $11 per square foot annually. That led to one long-time prospect, Shipfr8, to take its business elsewhere. Though maintaining an office in Maricopa, owner Peter Cockle said he is moving the “heavy” side of his transportation logistics business into a warehouse in Casa Grande.

At Estrella Gin, additional rent (insurance, maintenance, etc.) excluding electricity is 13 to 17 cents per square foot per month, which is $1.56 to $2.04 annually. The tenant allowance is $12 per square foot.

“I do feel like it’s competitive,” Jensen said. “There aren’t any newer buildings in Maricopa. Chandler and Gilbert, I would argue, are not comparable either.”

According to the commercial listings site Showcase.com, available industrial properties in Chandler have a base lease rate ranging from $6 per square foot annually (with smallest space more than 14,000 square feet) up to $16.80, which is flex space at Red Rock Business Plaza. In Gilbert, the price range is from $6.60 to $15.50. In Tempe, it is $6.24 to $15.50.

“I think it’s important, too, that we provide space in Maricopa that Maricopa businesses can afford,” said Beth Mundell, owner of Fyrestorm Cheer & Tumbling, who attended the open house. “I think it’s all well and good to bring in Chandler businesses or Tempe, but I would also like my business not to have to relocate to the Valley to be able to afford to continue running.”

Mundell rents business space at Ak-Chin’s Santa Cruz Commerce Center, “because that’s the only affordable space in Maricopa.”

She said the rent prices in the city are chasing out Maricopa’s own businesses.

Finding Tenants

Estrella Gin Business Park is conceived to be “flex space.” That is aimed at substantial, industrial or mechanic-based companies, plumbing and electrical installers or start-up dotcoms. Office space is in front with garage doors in back.

The first building is planned to be 36,000 square feet built to suit. When the shell is constructed to needs of the business, the tenant is responsible for adding walls and the location of restrooms within its space.

Utilities are connecting to the property along the Edison Road extension.

Jensen said eight to 10 companies have “expressed interest,” and a couple of those are deemed substantial, stable companies. No one has signed.

Local businesses, he said, are only interested in short-term lease agreements, however. That does not fit the business park model.

“We are hoping to get five to seven if not 10 years,” he said.

On the current timeline, The Boyer Company is trying to get pre-leasing agreements in place before February. Construction would be February through July. Tenants would move in September through December.

Even with construction delayed on the SR 238 intersection, the Edison Road extension is still expected to be finished by February or March.


This story appears in the December issue of InMaricopa.