Phoenix Market Update: Investment Activity Picks Up

Phoenix’s office transaction activity picked up the pace in March, after a slow February, when only 438,968 square feet changed hands. CommercialEdge data shows 1,383,345 square feet of office space traded across the metro for $152 million, a 215 percent uptick in square footage when compared to the previous month. The sale amount was 38.6 percent higher year-over-year, as 675,203 square feet of space sold for $106 million in March 2020.

While all investments were traditional offices, the deals involved all types of property classes, with nearly 987,608 square feet in Class A assets. More than half of the traded properties were located in suburban submarkets.

The largest property that traded was the 499,000-square-foot Freeport – McMoRan Center in Phoenix’s CBD. Griffin Capital purchased the iconic high-rise formerly known as One Central Park East in a $1.3 billion unrecorded portfolio transaction, which encompassed 4 million square feet of office, industrial, laboratory and retail space across 26 properties.

The largest single-asset transaction involved a property located in the Phoenix Deer Valley submarket. BPM Real Estate Group paid $110 million for the three-building, 365,672-square-foot PetSmart Headquarters, financing the transaction with a $68 million loan from 3650 REIT. The asset sold for $300.8 per square foot, higher than the average $235 recorded year-to-date across the metro as of March.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here. We included properties of 25,000+ square feet in our research.