Cross your fingers, Cross your toes! Pray the recession doesn’t go!
According to the recent CoStar report, strong office-using employment growth, fueled by major corporate expansions and relocations, has driven demand for office space, particularly at the top of the market. Steady vacancy compression translated into some of the healthiest rent gains in the country in the past several years. And a recent American Enterprise Institute (AEI) comparison ranked Arizona the number one inbound state in the nation. Demand has outpaced new supply for eight consecutive years, and vacancies remain below the market’s historical average.
A question concerning many is are we headed for a recession in the near future? According to a recent Deloitte Economic Forecast, “The picture of slowing growth and loosening traction of monetary policy means that authorities—hampered by rising budget deficits—might have trouble responding to a crisis. One much-discussed sign of trouble is the inversion of the yield curve. Lacking any good theory to explain why a yield curve inversion leads to a recession, our forecast does not assume a recession in the baseline. But we continue to judge that the probability of a recession is relatively high (25 percent).” Fingers Crossed!
Robust employment growth in Phoenix is fueling demand for office space, and developers are attempting to keep pace. Healthy leasing activity has resulted in about 2,500,000 SF of net absorption over the past 12 months, in balance with the 2,500,000 SF of deliveries. Since 2011, office demand has consistently outpaced new supply and compressed vacancies far below the market average to 12.2%.
WE ARE CPI – With 60 Agents, CPI has consistently completed more transactions per year than its competitors. This has allowed us to form relationships with more Tenants and Buyers than any other firm creating a high probability that the occupant of your property or the buyer of your building will come from our company’s relationships. And I am a member of our exclusive CPI Investment Specialist Team. For a no obligation analysis of your property, please call me at (480) 522-2799 to “TrboCharge” your investment real estate today.