Phoenix Landmark Reborn: Kinella Rescues Stalled One Camelback Tower

PHOENIX, AZ – December 29, 2025 – A prominent symbol of stalled development at one of Phoenix’s busiest intersections is poised for a dramatic comeback. The One Camelback tower, a half-finished office-to-residential conversion that has loomed over Central Avenue and Camelback Road for nearly five years, has been acquired by Kinella Capital, LLC. The boutique real estate firm plans to restart construction immediately, transforming the dormant structure into 163 luxury residential units and finally delivering on a long-awaited promise of urban revitalization.

The acquisition, backed by debt financing from Post Road Group, marks a pivotal new chapter for a project that had become a cautionary tale in the city's development circles. Kinella Capital, led by CEO TK Stratton, intends to leverage its specialized 'builder-operator' model to navigate the complexities that previously derailed the high-profile development, aiming for visible progress within the next twelve months.

A Landmark's Troubled Past

The journey of One Camelback has been fraught with challenges. The redevelopment of the former BMO Harris office tower began with ambitious plans in 2018 under a different ownership group, Camelback Owner LLC. The vision was to create high-end apartments boasting a 150-foot atrium, floor-to-ceiling glass, and commanding eleventh-floor views of the city. However, construction ground to a halt when the project was approximately 80% complete.

A perfect storm of factors contributed to its prolonged dormancy. The original developer defaulted on a $71.3 million loan in June 2023, following years of mounting financial pressure. Industry analysts point to a confluence of issues, including soaring inflation-related construction costs, significant pandemic-induced supply chain disruptions, and the impact of rising interest rates, which made the project’s final stages financially untenable for the previous owner.

Further complicating matters were reports of multiple contractor disputes, which resulted in nearly $1.5 million in mechanic's liens filed against the property by at least a dozen different firms. Ownership eventually transferred to Acore Capital through a foreclosure sale before Kinella Capital stepped in to acquire the asset. For years, the unfinished tower has stood as a stark reminder of the risks inherent in large-scale urban redevelopment, a visible blight on a key commercial and residential corridor.

A New Blueprint for Urban Renewal

Kinella Capital's entry into the project is being viewed by market watchers as a potential solution not just for One Camelback, but for other distressed assets. The firm differentiates itself through a fully integrated 'builder-operator' model. Unlike traditional developers who often outsource key functions, Kinella holds both KB-1 general contracting and A-1 engineering licenses, allowing it to take direct, in-house control of all construction, engineering, and operational details.

This integrated strategy is particularly well-suited for rescuing complex and stalled projects. By managing the technical aspects internally, the company can mitigate risks and remove uncertainties that often deter lenders. This approach was reportedly a key factor in securing financing from Post Road Group, an alternative investment firm known for tackling complicated situations that require rapid assessment and flexible capital solutions. Post Road’s focus on heavy value-add projects, construction financing, and special situations aligns perfectly with the needs of the One Camelback revival.

Kinella Capital’s leadership has a track record rooted in navigating difficult scenarios, including restoring thousands of buildings after structural failures and other disasters. This experience in distressed asset management is central to their strategy of targeting complex adaptive reuse opportunities that other investors might avoid. The firm views the One Camelback project as a case study to prove its model's effectiveness in salvaging high-potential properties.

Navigating the Challenges of Adaptive Reuse

The conversion of office buildings into residential units is a growing trend in cities grappling with high office vacancies and housing shortages, but it is a path laden with technical and financial hurdles. According to one urban planning expert, “Only a small percentage of office buildings are truly ideal candidates for conversion due to deep floor plates and core system limitations.”

One of the primary challenges lies in a building's fundamental infrastructure. Office towers are typically designed with centralized plumbing and HVAC systems intended for large, open spaces. Converting them to residential use requires a complete overhaul to accommodate individual kitchens, bathrooms, and climate controls for each apartment. This involves extensive and costly work, from running new plumbing lines and electrical sub-panels to reconfiguring ventilation systems. Furthermore, ensuring that every unit has adequate natural light and meets strict residential fire safety and accessibility codes can necessitate significant structural modifications.

These are precisely the types of challenges Kinella Capital's integrated model is designed to overcome. With in-house engineering and construction expertise, the firm can directly address structural, mechanical, and electrical issues, streamlining a process that can become bogged down by coordinating multiple outside contractors and consultants. This hands-on approach is critical for keeping the complex project on schedule and on budget.

An Answer to Phoenix's Housing Puzzle

The completion of One Camelback is set against the backdrop of a dynamic and evolving Phoenix housing market. While the broader metropolitan area has seen a surge in new apartment construction, leading to an increased vacancy rate of over 11% and some softening in average rents, the demand for premium housing in specific, high-demand submarkets like Uptown Phoenix remains robust.

This submarket, known for its vibrant mix of dining, shopping, and accessibility, has continued to attract residents, but its inventory of high-end rental units has remained limited. The 163 luxury apartments at One Camelback are poised to fill a crucial gap in this niche. The project's planned amenities, including a rooftop pool and modern finishes, cater directly to the discerning demographic seeking an upscale urban lifestyle.

The project’s revival signifies more than just the addition of new housing stock; it represents a significant investment in the vitality of the Central Corridor. For residents and neighboring businesses, the completion of the tower will finally erase a long-standing eyesore and inject new life into the neighborhood. With construction expected to resume shortly and phased occupancy to follow, the rebirth of One Camelback could serve as a powerful blueprint for how to successfully transform underutilized urban assets into thriving residential communities.