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Southeast Valley Leads 2018 Office Absorption

• The closing of Q1 found almost all leasing activity drawn towards the Southeast Valley, mainly due to the attractiveness of Tempe and Chandler submarkets as well as large amounts of negative absorption in class B and C properties throughout the rest of the valley.

• Class A product lead the absorption in the Southeast taking  626,583 of the cluster’s 856,930 square feet, underscoring the overarching demand for class A product.

• Tempe and Chandler also take the lion’s share of under construction square footage, with 1,483,132 of the total square feet under construction between the two, with 1,329,762 being class A.

• The Southeast Valley as a whole leads absorption and construction, however, it also holds a slightly below average rental rate. Fortunately Tempe commands the highest rental rate in the Valley, boasting a $34.54 overall rate that shows no signs of slowing. 

Source: JLL Research

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