• While developers have focused primarily on BTS over the last several years, the need for speculative office development will rise amid tightening vacancy.
  • Tenant activity was strong in the Tucson office market with the highest level of quarterly net  absorption in three years. 
  • In the second quarter of 2019, net absorption totaled 325,882 sq. ft. outpacing the total net absorption for all last year.
  • In the second quarter of 2019, market-wide vacancy fell 117 bps year over year to 10.2%. The rate is down significantly from its recessionary peak of 21.3% due to steady tenant demand and limited new supply.
  • The market-wide average asking lease rate declined to $21.14 per sq. ft. FSG in the second quarter.
  • One office completion totaling 200,000 sq. ft. came online during the second quarter of 2019 and 13,840 sq. ft. of office space is under construction.