A Leased-Up Office Building In Tempe Sells For Nearly $12M

A fully leased office building is something of a rarity in many markets in the current hybrid work climate, but one just sold in the strongest office submarket in Metro Phoenix. 

A Tempe office building at Hohokam Court was acquired last month for $11.7M, according to the Phoenix Business Journal.  

Arc Tempe 2005 LLC was the buyer of the fully leased, single-story, 71K SF building, which sits at 2005 W. 14th St. The LLC is affiliated with Jake Gallagher of Alignment Realty Capital, local real estate database Vizzda reported.

Six current tenants in the building reportedly “range from logistics to health care and professional services,” PBJ reported. They include anchor tenant Total Quality Logistics as well as San Tan Communications, Hope Group, and Sisu Health Solutions. 

Total Quality Logistics has been at the location since 2016, according to promotional materials by Cushman & Wakefield. The office, situated on 6.7 acres, was developed in 1989. Cushman estimates it will generate $243 per square foot and said it has an in-place annual net operating income of just over $1M.

ARC was represented by brokers at Lee & Associates, while the sellers were represented by JLL.

Tempe's office market is remaining steady and seeing strong sublet demand.

The city, which has an estimated population of 190,114 and is the largest office submarket with more than 10M SF of inventory, carried the Phoenix office market in net absorption in Q4 2025. 

The suburb was responsible for some 185K SF of the metro market's total 211K SF of positive absorption in the quarter, according to a Q4 2025 report by Kidder Mathews.

If the market remains strong, the footprint of the office may change, according to a member of the team 

“Should vacancies arise over time, the building’s configuration and zoning provide multiple leasing and repositioning options, allowing ownership to respond to market demand,” Marcus Muirhead of Lee & Associates told PBJ about Hohokam Court.

He highlighted the property’s key location, which is near Interstate 10’s busy “Broadway Curve” in the Valley.

This part of the freeway recently underwent a four-year improvement project, completed in 2025. 

Arc Tempe 2025, the new owner of the office building, reportedly plans to acquire more properties across Arizona.