Downtown Phoenix $117 million apartment project to preserve historic building

Article originally posted on AZ Central on April 22, 2025

A planned $117-million development in the southern part of downtown Phoenix will include restoring a historic building and reusing it as commercial space.

Colorado-based developer Aardex received approval from the Phoenix City Council in early April to develop a 14-story, 262-unit apartment complex on about two acres of land near First Avenue and Jackson Street.

The site includes two vacant buildings, one that is historically significant and was most recently used for court purposes, said Xandon Keating, deputy director of community and economic development for Phoenix, at a meeting of the Economic Development and Housing subcommittee in late March.

An artist's rendering shows the planned 14-story apartment tower at First Avenue and Jackson Street. The development includes rehabilitating a historic building.

The other building on the site is not historically significant, and the site also includes a surface parking lot.

The project would include demolishing the building that is not historic and building on that portion and the parking lot and rehabilitating the historic building. The rehabilitation would include restoring the exterior of the building and adapting it for commercial use, like retail or a restaurant.

As part of the agreement, the city approved a 25-year incentive, called a government property lease excise tax, or GPLET. The arrangement allows a developer to deed the land back to the city in exchange for tax breaks on the site. According to the agreement, the developer will still make payments to the city and other taxing jurisdictions, like school districts, in the form of a minimum payment that is determined by a third party.

Over the course of the lease term, the developer will pay $643,750 to the city for the rent on the land. The developer will also pay the equivalent of the city’s share of property taxes to Phoenix’s affordable housing trust fund.