Key indicators in the Phoenix industrial market continued to reflect steady growth and a healthy economy during the fourth quarter of 2017.
Overall vacancy decreased from 7.3% to 6.8% during Q4 2017 (its lowest level since 2006).
As the local economy continues to improve, companies are expanding their existing spaces or adding additional locations across the Valley.
During the fourth quarter of 2017, the Phoenix market recorded 2,883,749 sq. ft. of net absorption. Almost 58% of this net absorption occurred in the Southeast Valley and Phoenix Airport Area submarkets.
The marketwide average asking lease rate decreased from $0.65 to $0.64 NNN per sq. ft. (monthly) quarter-over-quarter. Out of the 28 submarkets, 11 reported higher rental rates, seven remained the same and 10 reported lower lease rates on a quarter-over-quarter basis at the end of Q4 2017.
At the end of the fourth quarter of 2017, there was 6,559,152 sq. ft. of industrial space under construction. This represented a 27% percent increase quarter-over-quarter and a 22% percent rise year-over-year.