Phoenix Office Market
| Average Asking Rent (Price/SF) | $26.46 |
| Vacancy Rate (%) | 17.0% |
| Net Absorption (SF) | -322,277 |
Like many other large metros, Phoenix was adversely hit by the onset of the pandemic within the United States. Fortunately, since the last Great Recession in 2008, Phoenix has made strides in diversifying its economy, which has helped the metro with its resiliency. The metro’s economy and employment has been a bit rocky with three rises and falls since April 2020, all coinciding with the ebb and flow of the state’s COVID-19 cases. Unemployment was the highest the metro has seen but it was still lower than the national average; that changed in October. The coming months will be key in determining how much the metro will need to recover after the vaccine is widely distributed.
Download Phoenix Office Market Report 4Q20Phoenix Industrial Market
| Average Asking Rent (Price/SF) | $0.66 |
| Vacancy Rate (%) | 8.3% |
| Net Absorption (SF) | 5,449,206 |
In the fourth quarter of 2020, the Phoenix industrial market continued to see vigorous tenant demand for industrial space, balanced with a healthy pipeline of industrial construction, both delivering to the market and currently under construction. Net absorption measured 5.4 million square feet for the quarter, a historic high, and direct vacancy continues to remain low for the market, even with a sizeable amount of speculative development delivering. Thanks in part to a talented labor force, strong population and job growth, lower relative cost of development to California markets and access to 35 million consumers within a one-day truck drive, the Phoenix industrial market has seen a surge in leasing by logistics, distribution, and certain ecommerce tenants. Additionally, Phoenix has become an increasingly attractive market for data centers, thanks in part to a state data center tax incentive and a relatively low number of natural disasters.
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