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Phoenix Market Reports

Phoenix Office Market

Average Asking Rent (Price/SF) $25.09
Vacancy Rate (%) 16.7%
Net Absorption (SF) 887,362

Evidence that the Phoenix metropolitan statistical area is maturing into a more developed economy can be quantified by the brawny fundamentals of the office market. Although the region's breakneck population and employment growth might remind investors of previous boom-and-bust cycles, the metro emerged this cycle as a haven for value, as many Fortune 500 companies are expanding or relocating substantial office footprints to take advantage of the low costs of office space and living for employees. This diversification, led by healthcare, tech and financial services, should add a new robustness to the market that is more in line with economies that are decentralized and have resilient bases, such as Boston. The influx of white-collar jobs and low cost of living is drawing waves of new residents to the Valley from all over the country at nearly three times the national rate. This translates to 11.0% year-over-year net migration, ensuring future strength.

Phoenix Industrial Market

Average Asking Rent (Price/SF) $0.66
Vacancy Rate (%) 7.4%
Net Absorption (SF) 1,894,020

The Greater Phoenix MSA solidified its position as a top 10 industrial market in the third-quarter of 2018. Driven by breakneck employment and population growth, combined with strong transportation infrastructure and available space, developers and tenants continue to exhibit confidence in the future of the fastest growing county in the nation according to the U.S. Census Bureau. The Valley of the Sun absorbed 5 million square feet of industrial product year-to-date, nearly 1.9 million square-feet of which was in this quarter alone. Vacancy took elevated construction activity, averaging almost 550,000 square-feet in deliveries per quarter this year, in stride, decreasing to 7.4% this quarter from 7.9% three months ago.

Phoenix Office Market Report
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Phoenix Industrial Market Report
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Local Market Contact:

Charles LeSueur

Senior Research Analyst

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