Despite uncertainty, Phoenix office market shows signs of demand increase

The Phoenix office market began the year strong, with 1.7 million square feet (msf) transacted in the first quarter. Deal volume was up 71.0% as compared to Q1 2021, indicative of renewed demand by occupiers so far in 2022. The Airport Area submarket had a strong first quarter, due in large part to Carvana’s nearly 268,000 sf sublease at The University of Phoenix’s Riverpoint Campus. Tempe also witnessed leasing activity nearly double from a year ago. Among the larger Tempe deals this quarter, Moov committed to 31,667 sf at 100 South Mill Avenue. Overall availability across the market increased to 24.4%, up 80 basis points (bps) from Q4 2021. Despite signs of improving demand, the market faces uncertainty as occupier leases expirations continue to roll and many companies are still strategizing what their office requirements will look like in the future.

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