COVID-19 puts a damper on Phoenix office market as growth cycle is interrupted

Although Arizona’s stay-at-home order was lifted in mid-May, the Phoenix area increasingly struggled with growing cases of COVID-19 as the second quarter progressed. State leaders were forced to tighten restrictions on many businesses at the close of June to stem the outbreak. Pandemic uncertainty and business disruption ultimately caused a jarring impact on Phoenix office market fundamentals. Leasing activity fell by 46.0% from the first quarter and marked its lowest level in more than a decade. Decision makers were forced to re-evaluate strategic priorities, including office space requirements, causing many real estate decisions to be put on hold.

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