By BEX Staff for AZBEX
A new report from CBRE shows construction volume in the Phoenix area industrial market declined in Q4 2024. There were 3.2MSF of deliveries and only 2.3MSF of new starts, according to the Q4 2024 Phoenix Industrial Market report.
A total of 15.9MSF is under construction.
The 3.2MSF in deliveries is made up of 21 buildings. Net absorption increased 11.4% from Q3’s results, for a total volume of 2.9MSF.
Vacancy remains steady at 11.2%, and CBRE reports an average NNN/asking lease rate of $1.00.
CBRE’s report does not detail the quarterly sales volume. For that information, Kidder Mathews’ Phoenix Industrial CRE Market Update – 4th Qtr. 2024 reports a total transaction volume of 23.4MSF.
Kidder Mathews reports different findings for the areas in which its report overlaps with CBRE. Its data shows a construction volume of 37.6MSF in Q4; however, the two firms include different outlying areas in their definitions of Metro Phoenix.
Under Kidder Mathews’ reporting, net vacancy was 13.1%, an increase of 140 basis points.
Q4 Office
CBRE reported no new groundbreakings or deliveries for general office development in its Phoenix Office Market Q4 2024 report.
Positive net absorption totaled 571.2KSF, and vacancy fell 60bps, coming in at 23.0%. Class A properties absorbed 255KSF, while Class B absorbed 316.3.
Full-service gross asking lease rates fell to $31.13/SF, a year-over-year decrease of $0.26.
Once again, the data in Kidder-Mathews’ Phoenix Office CRE Market Update for Q4 shows some different results. According to its research, total vacancy increased year-over-year by 150 bps, reaching 24.8%.
Kidder Mathews reports direct net leasing activity totaling 8.7KSF, reversing the trend of negative direct net absorption observed since 2023. However, the cumulative direct net absorption totaled -2.1MSF for 2024.