The unemployment rate for the Tucson metro area as of May 31st was 5.8%, 60 basis points (bps) lower than year end and 50 bps below the national rate. Decreased government spending impacted both Tucson’s market momentum and activity. Home prices and inventory flattened in the second quarter, while the inventory of Tucson residential listings increased.
PICOR Connect | Trends in Commercial Real Estate
Topics: Tucson, Commercial real estate, Office, Industrial, Investment property, Leasing, Absorption, Market trends, Economic development, Apartments, Multifamily, Vacancy, Lease rates, Medical office
If our firm’s revenue and activity are indicative of the market, Tucson office market momentum has clearly increased, with annualized lease and sale transactions up 44.7% over 2013. Our team was busy helping clients position themselves to best avail themselves of opportunities, with regard to pricing and availability whether for lease or investment. With continued tepidness in job growth, creativity and resourcefulness ruled the day.
The purpose of this report is to show the strengths and weaknesses of Tucson, Arizona and its sister cities, Albuquerque, New Mexico and El Paso, Texas. The three cities are sisters since they have many commonalities including climate, population size, and each city having a military base and a university. The stats and data shown herein are used to illustrate the bigger picture and may not reflect exact figures.
Tucson is about 60 miles north of the US-Mexico border and about 100 miles south of Phoenix, Arizona. The metropolitan population is about 1 million but the 2010 US Census Bureau reports a population of 520,000. Major industries in Tucson include Defense/Aerospace, Healthcare, and mining. Tucson does not have any major sporting teams beyond those associated with the University of Arizona. The current real estate trends include the build-up of downtown with new office buildings, street-car, student housing, restaurants, and retailers.
The major difference between Tucson and its sister cities is that it is in the shadow of a much larger city. The Phoenix metropolitan area is about 4 million people and has sports venues, a legitimate international airport, corporate industries, loop freeways, and a light rail line.
The Arizona México Commission held its semi-annual forum last week in Scottsdale with the theme "Are You Ready for International Business?" Because Cushman & Wakefield | PICOR has a decade-long commitment to cross-border commercial real estate, we thought it timely to share an update on the Sonora, Mexico commercial real estate environment and efforts promoting the Arizona-Sonora Region.