Nuveen Real Estate has snapped up a 19-acre office park in Tempe with plans to trade cubicles for loading docks. The firm paid roughly $23.2 million for Sky Harbor Innovation Park and is eyeing an industrial overhaul that would bring about 300,000 square feet of warehouse space across three buildings, while keeping roughly 60,000 square feet as offices. The move fits a growing trend of investors flipping older office sites near Sky Harbor Airport into logistics and last-mile hubs.
Nuveen buys 19 acres near Sky Harbor
According to Connect CRE, a Nuveen affiliate, USCIF Sky Harbor LLC, paid about $23.2 million to acquire Sky Harbor Innovation Park at 1920 W. University Drive from The Opus Group. Opus had laid out a plan to demolish the existing office buildings and replace them with three industrial structures: two buildings of roughly 109,870 square feet each and a third of about 78,500 square feet, with around 20 percent of the finished project retained as office space. The site is being marketed for industrial use with divisible floorplates aimed at distribution and e-commerce tenants.
Permits, approvals and what comes next
The Tempe Development Review Commission signed off on the redevelopment last fall, and city staff say the project is now working through subdivision plat and building-permit review rather than heading back to the City Council. As reported by The Real Deal, Savannah Harrelson-Driskill, a City of Tempe public information officer, told the Business Journal that "all approvals are administrative," a setup that could speed the schedule if Nuveen sticks with the existing plan. It is still unclear whether the new owner will tweak Opus's original scope.
Other developers racing for Tempe warehouses
Just south of the Nuveen property, Lincoln Property Company has already broken ground on Sky Harbor Logistics at 1515 W. 14th Street, a two-building, Class A logistics campus totaling about 255,766 square feet, according to a press release from Lincoln Property Company. Nearby, Panattoni Development bought the former State Farm regional campus at 2750 S. Priest Drive and is planning a roughly 355,000-square-foot industrial redevelopment, as reported by Bisnow. Together, these projects from institutional buyers and national developers are helping carve out a concentrated industrial corridor around Sky Harbor Airport.
What this means for Tempe
Developers and brokers say the conversions are already chipping away at the region's office inventory. The Real Deal cites Newmark data showing first-quarter office vacancy in metro Phoenix easing to about 23.5 percent and notes that Newmark has tracked more than 8 million square feet of office space marked for conversion since 2020. Sky Harbor Innovation Park is being marketed with 2027 delivery targets and divisible specs, according to the listing on LoopNet. The center was reportedly 100 percent leased at sale and included a large Target and a Sprouts Farmers Market that could remain part of the site's short-term footprint as the logistics buildings are constructed.
