Federal Realty Plans 216 Apartments at Phoenix's Camelback Colonnade

Federal Realty Investment Trust is proposing a 216-unit multifamily project on underutilized space at Camelback Colonnade, one of Phoenix's oldest shopping centers and a property that opened as East Camelback Mall in 1964. The plan has cleared the city's planning board and now needs Phoenix City Council approval; according to public filings, retail, restaurants and offices could eventually sit beside the residential units.

Camelback Colonnade is 62 years old in its original form and 32 years removed from the redevelopment that dedicated it under its current name in the fall of 1994. The tenant roster is a standard power-center lineup — Fry's, Best Buy, Marshalls, PetSmart, Old Navy, Bath & Body Works, Ulta, Michaels, Staples and Floor & Décor — plus a Nordstrom Last Chance discount store, and Federal Realty bought the property from RED Development in 2021 for $162 million, the Phoenix Business Journal reported.

The decision to build apartments on underused space acknowledges that the value in a property this old now sits in the land, not the storefronts. A 216-unit residential component gives Federal Realty a second income stream that does not depend on any single anchor tenant without requiring the demolition of a retail base that still produces rent. Such a center does not need new storefronts; it needs residents close enough to walk to the anchors. Connect CRE's report does not specify the size of the affected parcel or a construction timetable, yet the Colonnade is being repositioned as a mixed-use asset rather than managed as a pure shopping center.

The anchors provide traffic and place; the apartments provide the density and the recurring revenue that a legacy power center cannot generate on its own. For other owners of older retail in the Southwest, the city's response will matter as much as the project itself: a yes makes Camelback Colonnade a precedent for converting underused commercial land into housing without waiting for the stores to fail, while a no leaves a generation of owners with the same retail boxes and few new options. Phoenix is being asked to decide which future the region's old shopping centers deserve.