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2021 Q4 Greater Phoenix Industrial Market Report

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Q4 2021 Industrial Market

During the fourth quarter, the Phoenix Industrial market broke multiple barriers, which is elevating the market into a hyper competitive market. Investment sales reached the highest quarter ever in the market, topping off at $2.7 billion with a median price per square foot ending at $159 per square foot. Rental rates jumped 3.1 percent quarter-over-quarter ending at $0.69 per square foot. Net absorption for the quarter was 5.6 million square feet, and the total for the year peaked to 24.1 million square feet. Direct vacancy has decreased 40 bps quarter-over-quarter and 260 bps year-over-year to finish fourth quarter at 4.8 percent.

This is another benchmarking quarter for Phoenix, reaching the lowest vacancy rate ever achieved in the market. Approximately 5.6 million square feet of new inventory was delivered during fourth quarter, bringing year-to-date completions to a total of 15.2 million square feet. An additional 4.3 million square feet were started this quarter bringing total construction to 30.2 million square feet. This marks the highest level of construction activity in market history, ahead of last quarter that was previously a milestone.

Key Takeaways:

  • Rental rates have increased over 9.8 percent Y-o-Y
  • Net absorption in 2021 was 80% higher than 2020
  • Median price per square foot is up nearly 23.3 percent Y-o-Y

 


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2021 Q4 Greater Phoenix Industrial Market Report

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