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Colliers 2021 Q1 Greater Phoenix Office Market Report

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Q1 2021 Office Market

Key Takeaways
  • Sublease space continues to hit the market
  • Scottsdale Airpark delivers 635,111 square feet of Class A office space
  • Direct vacancy increases
The metro Phoenix office market ended Q1 2021 posting -372,905 square feet of net absorption, marking the second consecutive quarter of more than 100,000 square feet of negative absorption.

Direct vacancy increased 80 bps quarter-over-quarter and 150 bps year-over-year to finish first quarter at 13.8 percent.

Rental rates are holding strong. However, the increase of sublease availability is driving down overall rental rates, which settled at $27.48 per square foot at the end of March 2021.

Class A rental rates decreased both over-the-quarter and year-over-year -0.19 percent and -0.75 percent respectively, pushed by sublease availability.

Sublease availability increased a total 916,467 square feet during first quarter, elevated 29.1 percent over the quarter and 126.1 percent year-over-year.
Phoenix will continue to be viewed as a top tier market for businesses relocating and expanding. In addition to businesses growing here, our talented labor pool is also rapidly expanding.

The paused leasing activity is expected to shift as we have begun experiencing momentum with tour activity drastically increasing this quarter compared to the sudden halt last April. Rising land prices are a factor that predicts continue strong rental rates


Colliers 2021 Q1 Greater Phoenix Office Market Report

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Related Experts

Phillip Hernandez

Senior Research Manager, Arizona


As research manager for Colliers in Arizona, Phillip Hernandez is responsible for proactively developing and implementing research objectives and directing all research activity for the Arizona offices.

He provides leading-edge, thought-provoking research and analysis of market data for use in producing quarterly statistical market reports for each property discipline, as well as other ad hoc reports, research projects and presentations. Phillip analyzes and interprets real estate trends and maintains a database of economic indicators to provide forecasts.

Regardless of the property type or sector, Phillip believes each has a story to tell and that data provides the opportunity to redefine the narrative. With a background in location analytics, he is highly experienced in interpreting complex data sets. Using the latest technology, Phillip developed a system to blend analytics with a visually attractive approach to bring data to life.

Focusing on business development, he leverages market intelligence and insights for thought leadership content strategy in support of client engagement. His goal is to strategically align research and business development efforts and present research in an easily digestible format that promotes Colliers’ market share and revenue growth.

Colleagues describe Phillip as a brilliant storyteller and a passionate, creative and experienced professional.

Prior to joining Colliers, he served as a business analyst at CBRE, where he specialized in creating tailored research reports, as well as unique and interactive applications and dashboards that elevated the market position of assets. Phillip delivered weekly research updates, with relevant lease and sale comps, custom competitive sets and current market activity.

He provided complex market and trend analyses, monitored an extensive database of proprietary market data, and delivered custom quarterly and annual reports that were strategically positioned towards targeted clients. He also led weekly department research meetings to develop initiatives surrounding market trends, produce innovative industry solutions and analyze client-centric objectives.

Previously, Phillip was a GIS analyst for the central region of CBRE. Working exclusively with top-performing markets, he created unique models that illustrated custom real estate datasets through location analytics. Phillip produced high-quality geographic and demographic maps, and investigated multiple approaches to storytelling through map and market analytics.

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Casey Koziol

Sales Assistant


Casey Koziol is a sales assistant for Colliers in Arizona, specializing in landlord and tenant representation for the sale and leasing of office and industrial properties.

He prioritizes his clients’ best interests to ensure their requirements are fully considered and met, from initial steps through final transaction negotiations. Casey works diligently to attract qualified tenants and buyers to his clients’ properties.

As a lifelong resident of Arizona, Casey’s in-depth knowledge of the MSA enables him to identify sites that deliver the greatest benefit to a client’s day-to-day operations. His financial acumen ensures clients’ return on investment meets their expectations.

Leveraging his research expertise, Casey tracks and monitors market conditions, trends and tenants-in-the-market to guide clients towards informed real estate decisions that support their business.

As a participant in Colliers’ unique and intense broker training initiative, Casey pairs with various senior brokerage teams for three-month periods. This affords him the opportunity to work across property types with experienced professionals, while also generating business and building client relationships.

Clients and colleagues describe Casey as an ambitious and results-oriented professional, who strives for service excellence. His integrity, collaborative approach, effective communications and creative problem-solving make him a valued partner to his clients and team.

Casey joined Colliers in 2019, as a research analyst, delivering in-depth analysis of market conditions and trends. He compiled market statistics across all property disciplines, including industrial, office, retail, healthcare, multifamily and land. In support of sales, leasing and business development, Casey created compelling client-facing presentations, illustrating and interpreting real estate and economic trends.

Casey’s background includes working with landlord and tenant clients, primarily in the industrial and education sectors.

Prior to joining Colliers, Casey served as a real estate sales and acquisitions intern at Tucson Realty & Trust Company, where he specialized in identifying potential buyers and sellers for commercial properties in the Tucson metropolitan area. Accomplishments included locating a buyer for an industrial storage property in south Tucson and facilitating a 1031 exchange on behalf of a client.

Casey was also a marketing analyst intern for Keyser Commercial Real Estate in Scottsdale. He supported business development efforts through researching properties on CoStar for existing and potential clients for the tenant-focused firm.

His interests and activities include international travel, professional and collegiate sports, open water diving (scuba certified) and a variety of adventure challenges. He is semi-fluent in written and spoken Spanish, after spending a semester in Spain.

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