Why Phoenix's Industrial Market Has Moved To The Head Of The Pack
Almost without fanfare, industrial has become the darling property type in a lot of markets, rather than multifamily. CBRE SVP Bill Bayless tells us that Phoenix industrial is now very healthy.
"Activity from users is up across a variety of industries, including advanced manufacturing, food/beverage processors and distributors, pharmaceutical companies, 3PLs and last mile e-commerce companies, among others," Bill says.
Also, market fundamentals are trending positive, and as of Q3 2016 marketwide vacancy has dropped 52 basis points quarter-over-quarter and the market’s average triple net lease rate has increased 6.8% year-over-year. Bill's shown with his family on vacation in Coeur D’Alene, ID, this summer.
Metro Phoenix is benefiting from its proximity to Southern California, its deep labor pool and business-friendly environment. "California’s new minimum wage and higher costs of doing business [have] moved Phoenix up on the short list of inland ports considered by major industrial users looking to service the western United States," Bill says.
"Overall, as the Valley’s economy continues to diversify and strengthen, local real estate markets—and particularly the industrial sector—are going to continue to see steady growth.” Recently Bill repped Dolphin Manufacturing in its acquisition of the 97k SF 440 North 51st Ave in Phoenix (above), which he calls the "perfect size and location" for the buyer. JLL's Steve Sayre repped the seller, Kalyx.
