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Rents increase to highest level in nine years

  • ​Office rental rates in the Phoenix market increased to $25.21 per square foot in the second quarter, quickly approaching the previous peak of $26.82 per square foot set in 2007.
  • With absorption surpassing 12.6 million square feet and only 8.8 million square feet of new deliveries since 2011, the tightening office market has resulted in a significant increase in average asking rents.
  • Newly Class A space have influenced rate growth in most submarkets. The emerging Warehouse District is revitalizing new construction in Downtown Phoenix, already one of the market’s most expensive submarkets.
  • Additionally, a new 220,000-square-foot Class A building is set to begin construction by the end of 2017. Block 23 at CityScape is expected to command $38.50 per square foot, well above the Downtown Class A average of $32.20.​​

Source: JLL Research

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