Thank you for sharing!

Your article was successfully shared with the contacts you provided.

PHOENIX-A surge in housing starts along with the expansion of the Valley’s freeway system is fueling a demand for more retail development, particularly in the area’s booming, high-growth suburbs, a study of the Valley’s retail market found.

“In the outlying areas, growth is really strong,” Brian Kocour, senior associate with Grubb & Ellis/BRE Commercial, which commissioned the study, tells GlobeSt.com. Kocour says rapid residential growth is spurring a rapid rise in retail development, particularly in areas west of the city.

The Southwest Valley, once largely ignored by developers, has become the latest growth “hotspot.” One out of every four homes sold in the first three months of this year were located in the Southwest Valley so it’s not surprising that a spurt in retail development would follow. Developers soon will bring at least four power centers to the area along with a Westcor regional mall at McDowell Road and Bullard Avenue.

In the Southeast Valley town of Gilbert, housing growth is prompting developers to unveil plans for two power centers and a regional mall.

But even as the Valley’s retail market seems to be humming, vacancy rates in the metro area inched up slightly during the first half of the year to 7.7%, the report notes. Kocour attributes that increase to the closing of several “big box” retailers who have left empty shelf space and vacant buildings that have become ever increasingly difficult to fill. Developers will have to do some creative thinking to fill failed big boxes, but a turnaround can be accomplished, he asserts.

The increase in vacancies been good news for tenants who have seen concessions mount as building owners offer lower rates, longer free-rent periods and other perks. All those concessions haven’t scared off developers, however. They’re planning to open 10 new neighborhood centers and two power centers in the Valley by the end of this year.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt. NET LEASE Spring 2021Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.