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Jan. 31, 2014

CSM to Reinvent Phoenix Office Building as Select-Service Hotel; W.P. Carey Pays $23M for Avnet HQ In Tempe

By Amalia Otet, Associate Editor

CSM Lodging plans to revamp the historic Professional Building–the former Valley Bank & Trust building–in downtown Phoenix, and turn it into a premium select-service hotel.

The hospitality company, a division of CSM Corp., completed the purchase on Dec. 20. “We look forward to working with Phoenix, which has been so supportive, to open the hotel in time for the city’s hosting of the 2015 Super Bowl,” said Bill Upshaw, president of CSM Lodging, in a statement.

Located at North Central Avenue and Monroe Street, the landmark property will undergo a $40 million makeover. Highlights include renovation of the Art Deco exterior, installation of new insulated windows; new mechanical, electrical and plumbing systems; and a complete refurbishment of the former bank lobby, which will serve as the main reception and gathering place for hotel guests.

The hotel will feature 165 guest rooms on 12 floors, a rooftop terrace, 5,000 square feet of meeting space, a business center, a 1,300-square-foot fitness center, and on-site parking. Additionally, the compound will host approximately 8,000 square feet of retail along Central Avenue.

As to the branding options, CSM Lodging tends to gravitate toward either Marriott or Hilton; but the dearth of Hilton product in downtown Phoenix should tip the scales in favor of the Hilton Garden Inn brand.

Upon opening, Hotel Monroe is expected to bring 105 jobs to downtown Phoenix marketplace, on top of 100-plus jobs created during construction and an overall economic impact of about $18 million.

In other news, W.P. Carey Inc. announced that CPA®:17-Global, one of its publicly-held, non-traded REIT affiliates, has acquired 8700 South Price Road (below left), a Class A office building in Tempe, for approximately $23 million.

Built in 2000, the 132,070-square-foot facility serves as the global headquarters of Avnet Technology Solutions, one of Avnet Inc.’s two operating groups. It is located on a nine-acre tract within the Arizona State University Research Park and has direct frontage on the Loop 101 freeway.

Commenting on the acquisition, Morgan Olsen, President of the Arizona State University Research Park board of directors and Arizona State University’s CFO, said in a statement: “We are delighted that W. P. Carey has purchased a property in the ASU Research Park. This acquisition validates the institutional quality of the facilities and tenants within the Research Park, currently home to 48 companies which provide over 4,500 high-quality jobs.”

Chris Toci, Chad Littell and Michael White of Cushman & Wakefield Inc. represented the seller, Atlanta-based Piedmont Office Realty Trust, in the transaction, according to AZRE Magazine.

Avnet, a major global distributor of electronic components, computer products and embedded technology, will continue to occupy the building under a long-term net lease. As part of its commitment to sustainability, the company is seeking to install solar panels  to improve energy efficiency .

Photo credits: Professional Building courtesy of CSM Lodging; 8700 South Price Road courtesy of W.P. Carey Inc. via PRNewswire

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