A $150 million development will soon be drawing eyes toward the Tempe skyline at Town Lake, and construction is well underway.
The Watermark Tempe, a mixed-use project headed by Los Angeles-based Fenix Development, will house a 16-story office tower, 360-unit luxury apartment complex, 250-room hotel and 44,000 square feet of ground-level restaurant and retail space. Fenix Development has owned the land since 2010 and began master-planning the current project after State Farm set up shop on the south side of the lake. The company devised the mixed-use idea in collaboration with Nelsen Partners, a Phoenix-based architectural firm with offices in Scottsdale and Austin, Texas.
“This kind of development brings more life, more jobs and more investment to the Tempe Town Lake area,” said Tempe Mayor Mark Mitchell. “The incredible skyline you see from Loop 202 will become even more beautiful thanks to Watermark.”
The first phase of construction, which will include the high-rise offices and connected retail space, is expected to be completed by the end of summer in 2019. At the same time, Trinsic Residential Group will deliver the lakeside apartments.
“It was something that we saw as a big opportunity,” said Mike Loretz of Fenix Development, project manager for the Watermark site. “We think that the new trend is mixed-use lifestyle destinations… and we saw a big void for that in Tempe.”
The goal of the project is to create a space for people to live, work and play all in one stylish location, according to The Watermark Tempe website.
“We got a really good response from the local community,” Loretz said. “Everyone seems to be very excited about it and very supportive of what we’re building.”
The land that will form the footprint of the Watermark development has been underdeveloped and vacant for many years, Loretz said. The new project will turn that spot into a destination for local residents.
“We’re going to be creating a lot of jobs, creating a lot of tax revenue for the city and the state,” Loretz said. “We’re really creating a central gathering place for the community.”
Tempe has the lowest vacancy in Class-A office space in the state, and the Watermark development will help create more inventory in Tempe’s most sought-after area — the lakefront, according to Kris Baxter, public information officer for the City of Tempe.
“Large-scale mixed-use projects are strong contributors to Tempe’s economic development efforts in many ways,” Baxter said. “They epitomize our community’s masterplan for urban development that is focused on higher density, mass transit and amenity-based solutions. They maximize development opportunity in a vital part of the city where transportation accessibility, workforce and quality of life are already standard.”
The new development will be an “open invitation to companies looking to locate in an urban and amenity-filled community,” and the city expects both new and existing businesses to take advantage of the office real estate, Baxter said.
“The state always wins when a company locates (here) because it creates new jobs which in turn help grow and broaden the economic base,” Baxter said.
Phase two of the Watermark project will include the hotel and an additional office tower with ground-floor retail.
“We’re packing a lot of density onto the site,” Loretz said, noting that the site plan emphasizes efficient use of space on a lot that has never seen much use.
A third phase is still in the conceptual stage and will include for-sale condominiums, but “that’s a ways out,” Loretz said.