Source: Cushman & Wakefield | PICOR
Anchored centers in Tucson continued their long-standing success, and well-positioned projects like Park Place Mall trade area’s Wilmot Plaza reported some of the strongest rents and lease-ups in recent years. Tucson’s southwest submarket posted continued strong demand from retailers, entertainment venues, and restaurants.
Positive net absorption of 173KSF in Q3 brought vacancy down 40 basis points to 6.0%, matching its strongest performance since 2008 and nearing an all-time low. With smaller lease signings prevalent, improvement was largely widespread and organic.
Dominant demand for retail centers came from medical and service providers. For instance, the 14KSF pad under construction at Wilmot Plaza was pre-leased to Southern Arizona Urgent Care, Body Central Physical Therapy, Massage Envy, and Aspen Dental.
Greater Tucson was recently named the third fastest-growing metro area over 500,000 population by Bloomberg, with July year-over-year job growth of 4.2% in July, 2016 and total employment of 378,050.
The national housing recovery has improved Tucson’s prospects for population growth and is expected to spur construction.
Arizona was the only state in the U. S. to experience month-over-month construction job gains in July 2016, and was one of three states to report year-over-year growth. Nationally, September consumer confidence was at the highest level since 2007.
Read the Cushman & Wakefield | PICOR Marketbeat Tucson Retail Q3 2016 report.