• The Phoenix industrial market continued to perform in the second quarter of 2018 as healthy tenant demand outpaced new supply.
  • Overall, vacancy decreased 30 basis points during the quarter to 6.4%—the lowest rate since Q2 2006.
  • Despite tightening conditions, the market’s average asking lease rate remained at $0.64 NNN per sq. ft (monthly), where its hovered for the past few years.
  • Demand for industrial space was widespread across the Valley. Manufacturing, third party logistics, e-commerce, and food and beverage users were the most active users in the market.
  • On the supply side, developers continue to respond to rising demand for industrial space. Builders remained active in the second quarter following a wave of new inventory that came to market last year.
  • Strong employment and population growth underpins an optimistic near-term outlook for metro Phoenix, which will continue to support industrial fundamentals.