By Colliers in Arizona
The Greater Phoenix medical office market posted 6.2 percent rental rate increases over the past 12 months and investment sales were relatively strong in first quarter, despite recording a three-month period of negative net absorption. These statistics are part of the quarterly Medical Office Report released by Colliers in Arizona.
Rental rates for medical office space rose during the past 12 months and are anticipated to continue rising as Phoenix becomes a top tier destination for medical practices to relocate and expand. Phoenix is the top major metropolitan area in the country for population growth, which is driving demand for healthcare services.
Rental rates at the end of first quarter were $22.92/SF, marking a 3.1 percent increase over-the-quarter. Midtown/Phoenix submarket posted the largest year-over-year increase of 10.7 percent to $22.43/SF. This was followed by Chandler and Downtown North submarkets, which increased 9.7 percent to $20.45 and 9.0 percent to $21.58.
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