{"id":1004779666,"date":"2026-03-30T03:46:47","date_gmt":"2026-03-30T11:46:47","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004779666"},"modified":"2026-04-01T06:35:38","modified_gmt":"2026-04-01T14:35:38","slug":"phoenix-office-market-update","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/phoenix-office-market-update\/","title":{"rendered":"Phoenix Makes a Dent in Office Vacancy"},"content":{"rendered":"
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\"Exterior<\/a>
Building 3 within the Gilbert Spectrum campus came online in October 2025. Image courtesy of Yardi Matrix<\/em><\/figcaption><\/figure><\/div>\n\n\n

Phoenix’s office sector showed mixed performances across its fundamentals in the first month of 2026, according to Yardi Matrix data.<\/p>\n\n\n\n

One of the brightest spots was the vacancy rate, which posted one of the sharpest year-over-year improvements in the country. Coworking also expanded<\/a>, elevated the metro’s flex space footprint above the U.S. benchmark.<\/p>\n\n\n\n

Meanwhile, transactions held steady, though sale pricing trailed the national average.<\/p>\n\n\n\n

On the down side, construction activity continued to contract. The development pipeline remained modest and deliveries slowed down as last year’s completions barely surpassed the late-2024 figures.<\/p>\n\n\n\n

Reduced pipeline reflects national trends<\/h2>\n\n\n\n

At the end of January, Phoenix\u2019s office sector had 910,630 square feet of overall space under development across 17 projects\u2014accounting for 0.6 percent of the existing stock. Among its peers, The Valley ranked seventh, while Houston led in construction activity with 2.7 million square feet underway. The only two peer markets outperformed by Phoenix were Denver and Nashville, Tenn., where there were 604,628 square feet and 385,919 square feet underway, respectively.<\/p>\n\n\n\n

As for the competitive office space, Phoenix’s development pipeline included 432,258 square feet, accounting for 0.3 percent of stock\u2014below the 0.4 percent national average. When also adding planned projects in the mix, The Valley\u2019s figure amounted to 1.1 percent of inventory, still below the 1.5 percent national mark.<\/p>\n\n\n\n

The pipeline size placed Phoenix on the 14th spot among the top 25 U.S. markets and the seventh spot among peers. The metro outperformed Nashville and the Bay Area, where office developments amounted to 289,919 square feet and 145,000 square feet, respectively.<\/p>\n\n\n\n