Publish Date: 08-19-2019
Volume: XXV
Number: 31

GOODYEAR – In a deal BREW reported to be in the works in July, an affiliate of Nike Inc. of Beaverton, Ore. (NYSE:NKE) has paid $69,832,600 ($77.45 per foot) to purchase an industrial facility in Goodyear that is expected to have 500 employees in a new manufacturing operation. The 901,700-square-foot industrial facility, located just south of Van Buren Street at 575 S. 143rd Avenue, was developed and sold by a venture formed by Lincoln Property Co. (LPC) of Dallas, Tex. and Goldman Sachs Group Inc. of New York City, N.Y. (NYSE:GS). John Werstler, Cooper Fratt and Rusty Kennedy of CBRE in Phoenix had the marketing assignment on the speculative project and represented the seller. John Grady and Jackie Orcutt of CBRE represented the buyer. Maricopa County records show Nike IHM, Inc. (Nike affiliate) acquired the property in a cash transaction. GSLP Goodyear LLC (Goldman Sachs/Lincoln Property entity) was the seller. David Krumwiede, regional partner for LPC in Phoenix, spearheaded the development of the building known as Lincoln Logistics 40 (LL40). In October 2017, BREW reported LPC and Goldman Sachs joining forces and planning to develop the big box, warehouse-distribution project on a spec basis without any tenant commitment. GSLP Goodyear LLC paid $9.24 million ($4.25 per foot) to purchase the 49.92-acre, fully-improved site in November 2017 and the venture completed construction of LL40 late last year. Nike IHM will use the Interstate 10 Corridor facility as a manufacturing plant to produce the mid-sole cushioning portion of its athletic shoes. According to a well-documented Job Creation Agreement between the City of Goodyear and Nike IHM, the world’s largest supplier of athletic shoes and apparel will receive roughly $2 million in incentives in the form of job creation funding up to a maximum of $1.02 million and almost $995,000 from waiving/reimbursing plan review and permit fees for phase one. In return, the wholly-owned subsidiary of Nike Inc. that does business as Air Manufacturing Innovation (Air MI) will create up to 505 full-time jobs by 2025 ($42,614 average annual salary) and acquire the Goodyear building. Roughly 500,000 sq. ft. targeted for use in the initial phase is to be occupied by June 1, 2020, and within three years from the executed agreement date, Air MI will invest a minimum of $184.5 million in tenant improvements and capital equipment for phase one. The advanced manufacturing operation will be the company’s third such plant in the U.S. Believed to be to the largest spec structure ever to be built in the Valley with 40-foot clear height, Nike’s newly-acquired building also has 3,200 sq. ft. of fully improved office space. The facility is within The Airport Gateway at Goodyear, a 350-acre business park targeted for up to 3.5 million sq. ft. of industrial, office, hotel and retail space in an area that has foreign trade zone (FTZ) designation providing tax benefits and other incentives. LL40 tops a group of spec industrial buildings of varying sizes located near the Interstate 10 Corridor and the Loop 303 (Arizona State Route 303) that have been absorbed in recent years by a countless number of companies that have selected the West Valley so that they can distribute products to markets across the Western U.S. The privately-held Lincoln Property Co. has been active buying, developing, and managing office and industrial buildings in the Phoenix area. Several of those projects have been developed and/or acquired in joint ventures with Goldman Sachs, a Wall Street-based global investment banking, securities and investment management firm with $933 + billion in assets. Find out more from Air MI v.p. Lalit Monteiro at (503) 671-6453. Reach Krumwiede at (602) 912-8888. Joseph Sumberg of Goldman Sachs is at (212) 902-1000. Call the CBRE agents at (602) 735-5555.

Business Real Estate Weekly, Inc. is the publisher of Business Real Estate Weekly (BREW), a tip sheet newsletter that covers business and real estate activity in Arizona. Founded in 1995, BREW is a weekly publication focusing on new residential and commercial developments, the sale of income-producing properties and businesses relocating or expanding in Arizona. For those looking to have cutting edge information at their fingertips, BREW is the publication business professionals use to get the latest in commercial and residential real estate news in Arizona. Known for it's accurate, timely and independently researched information, BREW has been called "The Bible" for its detailed, first hand reporting on business and real estate deals in Arizona. With more than 23 years of stories and news items in our archives, Business Real Estate Weekly has the longest period of chronicled history of all business and real estate news sources in the Valley. With the newly-added multiple search capabilities in our archives, BREW is a must have for anyone researching real estate in Arizona or simply following the market.