"Phoenix is a strong market relative to what's going on in other parts of the country," said Pete Bolton, senior managing director. "In spite of recent events, the Valley is still growing albeit slowly." A contact tells GlobeSt.com that the event packed in more than 500 members of the Phoenix commercial real estate community.

Senior broker Brad Anderson said modest signs of recovery are on the way despite a year of major setbacks in the office market. Rental concessions will continue, he said, but midyear should bring a turn for the better.

North Scottsdale will continue as a market leader for net absorption, according to Anderson. New product will be limited that which is already under construction or build-to-suits. Spec development that would have started this year will be put on hold. And, he predicted vacancy could go as high as 19% before late-in-the-year activity kicks into action as companies renew interest in expansion plans.

Bob Crum, an industrial market specialist, also predicted a midyear rebound. The market, though, is not glutted with space despite lower demand. He believes gross absorption will come in somewhere around 12 million sf and net absorption about five million sf at the year's close. Industrial vacancy, he said, will hold at about 10%.

In the 2002 multifamily sector, specialist and senior broker Tyler Anderson said 6,000 units will deliver, but still occupancy will hold firm at 91%. The upshot is multifamily remains an excellent investment at this point in time, he added.

Phoenix stands to fare better than the "safe harbor" investment markets in New York City, San Francisco and Chicago. Yet, senior broker Glenn Smigiel said investors still will exercise caution this year. He believes retail properties, particularly grocery-anchored shopping centers, will continue to be a hot item for investors as well as industrial investments. Smigiel also predicted office property buyers will increase as the bid-ask price gap narrows. And finally, he believes investment activity for class A and B properties will experience a moderate decline.