Not a day goes by that one of our landlord clients, an appraiser, or lender doesn’t ask us what the Tucson office market will look like once we work our way through the ongoing COVID-19 pandemic. We certainly wish we had a crystal ball that could see through this conundrum; however, it just isn’t that easy. The crystal ball, as clouded as it is, probably would not hold a vision of this pandemic[…]
In Q2, Tucson’s post-pandemic office market began to re-center itself, as vaccinations became more widespread, and employers planned their return to office strategies. Vacancy rose to 9.5%, with an expectation it will approach 10.0% by year-end before stabilizing. Activity was strongest in the healthcare-related fields, with hospice, home health care, counseling and therapy uses most prevalent.
In Q2 2021, Tucson industrial and flex space of all types remained the darling during tumultuous pandemic times and for the foreseeable future. E-commerce and expanded consumer buying power drove logistics and fulfillment demand and a 5.5% vacancy rate in the market.
For investors looking for investments $20 million and under, Tucson ranked number 4 on the list of small/middle sized markets. A larger driver of the demand for multifamily in Tucson is the attractive year-over-year (YOY) average rent growth of 9.1%. The shortage of affordable and traditional housing in Tucson also fuels apartment rental demand. With construction costs tripling on certain[…]
Tucson’s Q2 retail vacancy held steady at 6.2% amid a resurgence in demand for consumer goods, entertainment, and travel as vaccine availability and guidance opened the door for spending like it’s 2019. Summer midweek waitlists at restaurants have become a thing. With continued strength in class A space, class B and C properties saw improved absorption and declining vacancies. Among the sizzling[…]
CoStar Group, Inc., the data/analytics leader of the commercial real estate industry, has announced this year’s Power Broker Award recipients, recognizing professionals and firms who closed the highest transaction volume in commercial real estate deals, leading in their respective markets. In Tucson, AZ, Cushman & Wakefield | PICOR maintained uninterrupted achievement among both the Top Leasing[…]
The Tucson office market had a strong showing to finish 2020, with 162,000 square feet (sf) of office space coming off the market during the fourth quarter. Quarterly absorption contracted to negative 19,000 sf from the previous quarter’s negative 181,000 sf. The vacancy rate improved by twenty basis points to 9.2% from 9.4%, while the overall average rental rate for the metro area dropped to[…]
With new COVID-19 relief bills making their way through Congress, Arizona businesses are expected to receive additional economic relief in the following months. Arizona’s unemployment has risen from 5.9% in August to 7.8% in November largely due to the ramifications of the pandemic. Tucson’s unemployment correlated almost exactly to Arizona’s, increasing from 5.9% in August to 7.6% in November.[…]
As in most markets in the United States, the Tucson retail real estate market strained in the third quarter to adapt to the realities of COVID-19 era business. Some large format retailers already pressured by online retailing and changing consumer preferences have simply been unable to continue operation.
Supply in the Tucson industrial market remains stable, with only one new industrial project under construction. We do hear of numerous proposed industrial developments in the region with 5,000-10,000 square foot (sf) bays. We expect supply of small-bay industrial (under 5,000 sf) to remain consistent until rents grow by 35%-50%.