Middle Market Digest: This Week in Southwest

Here’s a look at this week’s trends, announcements and deals that you may have missed in Southern California, Utah, Arizona and Nevada.

BY THE NUMBERS

PHEONIX—In 2017, the Phoenix industrial market achieved its largest annual net absorption gain in market history, reaching 9.8 million square feet by year end and marking the fourth consecutive year of annual net absorption totaling 6.0 million square feet or more – a feat not reached since 2004 – 2007 – according to the Q4 2017 JLL Phoenix Industrial Market Insight report. These benchmarks were accompanied by other highly positive market factors including annual rent growth of 4.2 percent and a drop to 7.6 percent in overall vacancy, the lowest in 10 years. And the industrial market shows no sign of slowing. Unlike previous cycles, which relied heavily on the homebuilding industry, the JLL report notes that demand and risk in the current Phoenix industrial market is now spread across a diverse range of growing sectors. Some of the most active of these are e-commerce, food and beverage, logistics services and manufacturing, with growth being generated among companies with footprints already in Phoenix and from new users entering the market. According to JLL, 2018 could exceed 10.0 million square feet of net absorption along with an increase in speculative development to meet unprecedented demand.