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| Karsten Peterson |
PHOENIX, AZ – JLL reports new commercial construction
is still going strong in Greater Phoenix, AZ markets.
• More than 2.2 million
square feet of office space (including 439,530 square feet of speculative
space) is currently under construction in Greater Phoenix. An impressive 80
percent of that space is pre-leased.
• Almost 82 percent of
space under construction (1.8 million square feet) is represented in three
projects: Marina Heights, Arizona Department of Economic Security
(build-to-suit in Chandler) and Skysong 4.
Expansion and absorption continue:
• A healthy 423,748 square
feet of office space was absorbed in Phoenix during Q1, a 48.5 percent increase
from one year prior.
• Overall vacancy is
expected to decline in 2016 as office-using employers continue to expand and
relocate to the Valley.
But the dynamics of spec development may be shifting:
• Speculative office
development is declining as developers assess the market, taking note of how
long the over 1.0 million square feet of vacant space delivered in 2015 stays
on the market before kicking off new projects.
Here’s what JLL Managing
Director Karsten Peterson says about
Q1 office market trends from the landlord’s perspective:
“This recovery has seen a
greater percentage of build-to-suits than previous Phoenix market rebounds.
"We
are hearing loud and clear that Corporate America wants buildings that meet the
needs of today’s tenants – larger floorplate buildings with higher parking
ratios and finished with a creative interior improvements including open
ceiling environments, indoor/outdoor connectivity and walkable amenities.
“Expansions, consolidations
and relocations still support the speculative office development pipeline, but
that side of the market may begin to slow as capital becomes harder to secure.”
For a complete copy of the company’s news release,
please contact:
Stacey Hershauer
focusAZ
Marketing & Public
Relations
(480) 600-0195
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