Valley office vacancy rate continues to drop — as rents rise

Chase Tower Phoenix / Wikipedia

 

Sale of downtown Chase Tower was Valley’s biggest office transaction in 2018

By Corina Vanek | Phoenix Business Journal

As metro Phoenix’s employment rate continued to grow in 2018, office vacancies in the Valley dropped to their lowest level since 2007.

The Phoenix area ended the year with a 15.6 percent vacancy rate, its lowest point since the rate reached 14.3 percent in 2007 just prior to the Great Recession, according to Cushman & Wakefield research. The firm anticipates that the vacancy rate will continue to drop in 2019, as employment continues to grow in the Valley, fueled by organic growth and expansions, as well as corporate relocations.

In 2018, the office market had more than double the absorption than in 2017, with 2.8 million square feet of absorption for the year, including 640,000 square feet in the fourth quarter alone.

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