Todd Ostransky, vice president of development at Indicap, knew Metro Phoenix was a market the firm wanted to enter for industrial development. Though the area is a hotbed of industrial activity, Indicap’s attention immediately set on Mesa, less than 20 miles east of Phoenix, for its inaugural project.
“We identified the East Valley as an area of growth, along with the need for space for mid-bay industrial spec product,” he says.
Indicap and joint venture partner AECOM-Canyon Partners chose a 65-acre space within the mixed-use, master-planned community of Eastmark. The JV purchased the site for $48 million in April 2022 during a period of “aggressive expansion,” which saw Indicap kick off 10 developments involving more than 13 million square feet of Class A industrial space across key Arizona corridors.
The inaugural Phoenix-area project was Eastmark Center of Industry, which completed Phase I construction in April. This phase brought 978,837 rentable square feet of Class A industrial space to Mesa’s Gateway Airport submarket. The space spans five mid-bay and cross-dock buildings. It features concrete slab on grade, tilt-up exterior walls, and a hybrid wood roof system, ensuring durability and flexibility.
Power was also a major amenity for a project of this size, Ostransky notes.
“Strategically, this site stands out due to its proximity to the Browning Substation, ensuring ample power supply,” he says.
Eastmark Center’s proximity to other uses and transportation corridors was a high priority as well.
“It also offers convenient access to several major freeways, facilitating connectivity across the Valley,” Ostransky continues. “The location is further enhanced by its position in the popular Elliot Tech corridor, home to prominent Fortune 100 companies like Meta, Apple and Amazon. Considering all these factors, we concluded that this site was an ideal choice for launching our first Indicap project in the Metro Phoenix area.”
A Mix of Uses
Ostransky also appreciates Eastmark Center’s location within the larger mixed-use, master-planned community of Eastmark. This area includes 15,000 residential units and 20 million square feet of commercial space, in addition to its high-tech neighbors.
“The mixed-use element promotes a vibrant, sustainable community by combining residential, commercial and retail spaces,” he notes. “This integration enhances economic stability through diverse income streams and boosts foot traffic, benefiting local businesses. As urban planning evolves and the demand for efficient use of space increases, it’s likely that we’ll see more industrial projects integrated into mixed-use developments.”
This trend is also likely to take off, Ostransky adds, due to its convenience for workers.
“Being in a mixed-use environment improves residents’ quality of life by reducing commute times and fostering a sense of community through shared spaces,” he says. “This trend is driven by the need to optimize land use and reduce transportation costs, while also providing amenities and services that attract a diverse workforce.”
Collaboration is another benefit of situating industrial within the mixed-use environment. And Mesa is ripe with collaborative opportunities with the tech corridor and booming local semiconductor industry.
“Mixed-use environments that include industrial components benefit from the synergy of residential and commercial elements, which can lead to increased productivity and innovation,” Ostransky continues.
Steve Larsen, senior managing director at JLL, already sees the synergy at work among neighboring industries and projects. He’s marketing Eastmark Center alongside JLL’s Pat Harlan and Jason Moore.
“We’ve got a couple of groups on our prospect list that are 350,000-square-feet-plus users,” Larsen says. “One is a battery manufacturer, and one is a third-party logistics company on behalf of the semiconductor industry.”
In addition to the semiconductor market, Indicap and its support teams believe Eastmark Center may attract users within the aerospace/defense, pharmaceutical, medical device, electric vehicle/EV, sustainability manufacturing, and logistics and warehousing industries.
Phase II of the project is slated to begin next year.
— Nellie Day