Developer says he's 'reorganizing' financing
A slow leasing market has halted construction at Chandler Piazza, an 18-acre mixed-use project at the southeastern corner of Frye Road and Ellis Street, east of Chandler Fashion Center.
Work stopped about a month ago on the retail portion, and the start of construction has been delayed on the two-story office building.
"We're reorganizing the financing," said E.J. Pospisil, CEO of Momentum Commercial Real Estate, the Scottsdale-based developer.
He had intended to lease the retail space, but is negotiating with three restaurants that want to buy space instead.
Pospisil predicted construction would resume within two to three weeks.
"Banks are a little nervous these days," he said. "They're holding back a little bit, and we're being cautious. . . . We don't want to extend more money on construction until we get new financing in place."
The start of the office building has been delayed because "leasing has been slower than we'd hoped," Pospisil said.
Once some preleasing is accomplished, construction will begin.
"Activities have picked up recently with people looking, and we have two large (office) tenants we are negotiating with to get leases in place," he said.
A hotel in the project will be an Element, a new luxury extended-stay brand that owner Starwood says was inspired by Westin.
Hotel construction was delayed because new city approval was needed after the flag changed from Marriott to Element.
The hotel had been expected to open early this year. Now groundbreaking is expected in 60 to 90 days, Pospisil said.
"It's a difficult market, but I think we're going to work right through it," he said.
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