News Ticker

Phoenix Q2 Office Sales Volume Doubles Y-o-Y

Courtesy of COMMERCIALCafé

By Ioana Neamt for COMMERCIALCafé

The Phoenix office market was an attractive scene for investors during the second quarter of 2017, with 20 notable deals closed for a total of $513M. The average price/SF for office buildings trading on the market is holding steady, roughly on par with the average of the past five years, according to in-depth Yardi Matrix data.

Overall, the market saw significant improvement compared to both Q2 2016 and the first three months of 2017, a sign that buyer interest is strong and investment opportunities in the area are plentiful.

Q2 Sales Volume, Number of Deals Double Y-o-Y

A total of 20 large office transactions closed in Phoenix during the second quarter, amounting to $513M in sales volume – making it the market’s best Q2 in five years. The number of deals closed doubled year-over-year, and the dollar volume nearly doubled as well, a sign that investors aren’t losing interest in Phoenix’s office market.

The total sales volume also increased significantly from Q1, when 12 assets changed hands for $275M, though the total square footage traded rose by less than 200KSF. Investors focused their attention on more affordable options, as 13 Class B and C office properties traded during Q2, and just six Class A assets sold.

Average Price/SF Reaches $174 in Q2

The average price/SF for office buildings trading on the Phoenix CRE market climbed to $174 at the close of Q2 2017, roughly on par with the numbers recorded the previous year. Prices are holding above the average of the past five years, and well above Q1 numbers.

Average prices peaked in Q3 2016 at $243/SF – the only quarter in the past five years to top the $200 mark, and an obvious anomaly for the market. By comparison, the first quarter of 2017 saw prices sink to a five-year low of $102/SF. Excluding these singular variations, the market hasn’t experienced any dramatic fluctuations since 2013, signaling that buyer interest is steady and prices don’t tend to vary drastically in Phoenix.

Read more at COMMERCIALCafé.

Leave a comment

Your email address will not be published.


*