Source: Colliers International in Greater Phoenix
Colliers International in Greater Phoenix has released its Investment Report for Q2, and things are generally looking up.
After a slow start to 2017, many of the trends that emerged during the first quarter reversed course during the second quarter. More properties sold, prices trended higher and cap rates compressed.
Sales of commercial properties gained momentum in the second quarter. Transactions involving shopping centers recorded one of the most dramatic increases, however sales of traditional office buildings slowed in the second quarter.
Prices generally rose in Q2. The primary driver of price appreciation is the strengthening of property fundamentals. Net absorption has been strong, vacancies are tightening and rents are on the rise throughout much of Greater Phoenix.
Cap rates compressed during the second quarter and are averaging in the low- to mid-7 percent range. To this point in the cycle, investor demand in the market has been strong enough to offset the Federal Reserve’s modest interest rate increases.
For Colliers’ complete take on Phoenix-area Office, Medical Office, Industrial and Shopping Center investments in Q2, read the full report here.