By AZRE | AZ Big Media
The Greater Phoenix medical office building market is posting positive net absorption and rising rental rates as the city experiences nationally recognized population growth, according to a report released by Colliers in Arizona.
Positive net absorption of medical office space during second quarter totaled 206,449 square feet, recovering from first quarter’s negative net absorption and bringing the year-to-date net absorption to 173,331 square feet.
Arrowhead posted the largest net absorption for the quarter with 111,656, followed by Glendale at 44,699 square feet. Approximately 47 percent more deals were signed during second quarter, marking a rise of 49 percent year-over-year.
Vacancy has declined as absorption picked up, falling 10 basis points during second quarter and 30 basis points year-over-year. The current vacancy rate is 13.1 percent across the metro area. The Airport Area submarket shows zero vacancy, while Downtown North posted the second lowest vacancy at 2.9 percent. Evaluating submarkets with more than a million square feet of medical office inventory, the Loop 303/Surprise submarket posted the largest decrease in year-over-year vacancy, falling 5.9 percent from mid-year 2020 to 10.2 percent.
