The Trend Report, July 2024 Edition
Wow, it’s already mid-summer! Halfway through the year, I think there is a lot of activity in the Tucson market. I am seeing a lot of small business leases and small business expansion. I have executed leases with government security contractors, HVAC companies, furniture builders, yoga studios, moving companies, Fiber installation contractors, Synthetic turf suppliers, and waste disposal contractors for Pima County, some of the industries that have been leasing actively within my world.
I am currently looking for space for a volleyball and pickleball club, a contractor’s yard, warehouse painters, an online auction house, real estate investors looking for an industrial property with fresh leases signed, doggy daycares, and a client looking for an automotive storage facility.
I have also done a few Gem Show leases and sales. We have leased to smaller companies who come for the Gem Show every year from overseas and must store goods while they are gone between Gem Shows. I also worked with a Big Gem Show property owner and completed high-profile assemblies, buying warehouses and adjacent parcels to own a larger footprint. The idea behind some of these assemblies is to create larger, more accessible parcels that we believe, over the next few years and with some of the new development in Tucson, will be much more valuable in the next three to five years.
One of these areas is near Country Club and I-10, which is where the new Mosaic Quarter is being built (view our blog post about this topic here). Country Club and I-10 are also where a new airport corridor is being built, and a new ADOT project will be starting in early 2025. They will be adding a new interchange with on and off-ramps that will finally connect Country Club to the I-10. The assemblies we have completed in this area should be suitable for c-stores, gas stations, and potentially some multifamily low-income rises if rezoning is favored in the neighborhood. The Gem Show has not had the turnout that it did pre-Covid so there may be an opportunity for some of the lots that have always been undeveloped and retained for the Gem Show to be developed into something with a higher and better use in the future.
Another trend worth mentioning is that I have a .55-acre piece of land near downtown in escrow with an out-of-state multifamily developer building a 30–40 unit low rise on that parcel. I showed them another parcel nearby, which is .66 acres, that they loved, and they are in escrow on that as well. They can build 50-60 units on that parcel. Three groups of out-of-town multifamily developers are interested in the land in up-and-coming areas. I continue showing them options they seem pleased with in the Tucson market. I like working with groups outside of Tucson who do development because the price of our development land is very digestible compared to many other cities where they do development projects.
One last trend I have noticed in the Tucson market on the tenant rep side is that many tenants want or need something very specific and cannot find it for them. Many businesses want to set up shop in Marana, but the rents out there are much higher than some small businesses can pencil in to make it work. A lot of times, even with saved searches updated every day, we can’t seem to find the type of space they are looking for in that area. There are tenants I have been working with for months and check in with every week, and we are still looking for something. Unless they have a nationwide footprint or are publicly traded, even if we find something, the landlords often do not want to take the risk on a small business.
Kameron “Kam” Norwood joined Cushman & Wakefield | PICOR in 2023 to fulfill his dream to excel at the top commercial real estate firm in his hometown. A Tucson native and University of Arizona graduate, Kam launched his career in technical staffing, working from recruiter to management for over eight years. At 29, he left corporate America to chase his entrepreneurial dreams of founding a hemp business to help farmers commercialize their goods. This evolved into a Forbes-featured, award-winning CBD brand. Along with his co-founder, Kam started Packdash, a third-party logistics company empowering other small businesses’ fulfillment options when they needed them the most. After building PackDash into a two-million-dollar enterprise, they sold to a larger company in early 2023. Kam applies this entrepreneurial mindset to offer enhanced support to his clients, drawing from his experience in the supply chain, leadership, finance, and business operations. Kam can be contacted at knorwood@picor.com.
