COVID-19 will test the resiliency of the market, but Phoenix may have several factors working in its favor

The swift emergence of COVID-19 in March caused disruption to everyday life and introduced substantial uncertainty to the Phoenix office market. Governor Ducey ordered the shuttering of non-essential businesses through the end of April at earliest, and schools were closed through the end of the academic year. While the magnitude of an economic downturn has yet to be ascertained, it is possible that a downward repricing will occur in Phoenix. However, the market appears comparatively well-positioned to weather the storm, given lower rates of COVID-19 infection in Phoenix as compared with other metro areas. Additionally, Phoenix remains a fast-growing, lower-cost market that has become increasingly attractive to occupiers and investors alike. These factors, however, will not protect Phoenix from rental rate compression entirely.

Read the full report