PICOR Connect | Trends in Commercial Real Estate

Tucson Industrial Insights at Midyear

Posted on Mon, Jul 15, 2019

The Tucson industrial market remained strong at midyear, as evidenced by our primary metric: Vacancy rate. Once again, vacancy has ticked-down, this time to 5.1%. Echoing the comments last quarter, Tucson is experiencing a “plateau effect” in the industrial sector in that the dynamic run-up in absorption slowed as the market leveled off at a highly-occupied equilibrium. 

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Topics: Tucson, Industrial, Economy, Commercial real estate, Absorption, Market trends, Vacancy, Lease rates, Warehouse, Leasing, Manufacturing

Tucson Start-up Manufacturing Growth Accelerates

Posted on Tue, Jul 09, 2019

Smaller scale manufacturing operations (1,000-5,000 SF) seem to be opening up shop and gaining momentum faster than ever. Why is this happening? I think the cost of manufacturing machines has come down and because of the strong economy, entrepreneurs have the spirit and the capital to start a manufacturing operation or grow their business with existing cash or lines of credit. Also, the cost of distribution continues to become more competitive.



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Topics: Tucson, Industrial, Warehouse, Foreign trade zone, Manufacturing

Tucson Industrial Market Review & Outlook

Posted on Tue, Feb 12, 2019

Positive momentum continued its five-year trend in 2018 in the Tucson industrial market, with vacancy improving to 5.7%, cut in half from its highest point in recent years. At year end, vacancy was lowest in the city center at 1.5% and highest in the Southwest/Airport area at 12.8%. Net absorption was 50.4% stronger than in 2017, and thanks to Amazon’s two projects, space under construction has quadrupled year over year. Significantly, Amazon is entering the market with an 850,000 square foot (sf) distribution center under construction in the southeast sector and a new 50,000 sf service center in the southwest.

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Topics: Tucson, Industrial, Economy, Commercial real estate, Economic development, Market trends, Vacancy, Lease rates, Logistics, Manufacturing

Let the Good Times Roll! Tucson Industrial in 2018, TREND Report

Posted on Wed, Jun 13, 2018

“Wow!  What a great time to be in Industrial real estate!” These are sentiments not heard in almost a decade.  During the depths of the doldrums, the Tucson commercial real estate market was marked by Foreclosures and REO sales, “blend and extend” lease negotiations, downsizing (or “rightsizing” as it was more positively termed) and a general sense of survival.

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Topics: Economy, Commercial real estate, Economic development, Investment property, Market trends, Lease rates, Warehouse, Transportation, Logistics, Manufacturing

Tight Tucson Industrial Market Signals Demand for New Space Ahead

Posted on Fri, May 04, 2018

Absorption of Tucson industrial space continued during the first quarter of 2018, with 57,423 square feet (sf) of positive net absorption for the quarter. This reduced the overall vacancy rate to 6.3% in the 42.9 million square foot (msf) inventory of industrial buildings.

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Topics: Tucson, Industrial, Commercial real estate, Warehouse, Logistics, Manufacturing

Tucson Industrial Market Finds Equilibrium

Posted on Mon, Nov 06, 2017

The industrial market in Tucson has largely arrived at an equilibrium in lease negotiations between landlords and tenants. Vacancy experienced a slight uptick in the past two consecutive quarters, but this is viewed as a natural ebb-and-flow as tenants move around our market, rather than an indication of concern.

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Topics: Tucson, Industrial, Commercial real estate, Investment property, Vacancy, Leasing, Manufacturing

Tucson Industrial Market Sees a Surge

Posted on Wed, Feb 15, 2017

With accelerating improvement in vacancy from 9.2% to 7.8% year-over-year, Tucson’s industrial market reported the strongest annual gain since 2006 and the lowest vacancy mark since Q3 2008. With occupancy above 92% and no speculative space under construction, the market will experience upward movement in rents. Rent pressure has already occurred for spaces 5,000 square feet (SF) and under. Net absorption for 2016 nearly doubled that recorded in 2015 at nearly 1.5 million square feet (MSF). Absorption over the past twelve months exceeded all years since 2006’s high of 1.9 MSF.

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Topics: Tucson, Industrial, Economy, Commercial real estate, Economic development, Vacancy, Warehouse, Leasing, Logistics, Manufacturing

Mexico's Commercial Real Estate Update: TREND Report

Posted on Wed, Jun 29, 2016

Last year proved to be a challenging year globally: the slowdown suffered by the China economy, falling of oil prices and the expectation of raising rates by the FED caused pressure on world markets. Mexico was not the exception.

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Topics: Industrial, Sonora Mexico, Commercial real estate, Manufacturing

Mid-Year Perspective on Tucson's Industrial Market | TREND Report

Posted on Tue, Jun 14, 2016

We were recently invited to speak at the Southern Arizona CCIM 2016 Commercial Real Estate Forecast. This event focuses on all aspects of Commercial and Multi Family real estate in Tucson, Arizona and brings together market leaders to speak on the various commercial real estate disciplines. Various market specialists share their expertise and perspectives on the general health and advancement, or decline, of the commercial real estate sectors. For 2016, industrial can be referenced as being in a state of advancement, unlike the eight years preceding it.

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Topics: Tucson, Industrial, Sonora Mexico, Land, Commercial real estate, Investment property, Warehouse, Manufacturing

Velocity up in the Tucson industrial market

Posted on Thu, May 08, 2014

The national economy picked up in demand following the extreme winter. While statewide job gains are expected to outpace the nation in 2014, post-recession job recovery locally has lagged, leaving job creation the most pressing demand driver. March unemployment in Tucson was 6.6%, which was under both the state’s rate of 7.3% and the U.S. 

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Topics: Tucson, Industrial, Commercial real estate, Investment property, Absorption, Market trends, Vacancy, Warehouse, Manufacturing