Last night, AZRE magazine hosted the AZRE Forum at the Camby, where three panelists of commercial real estate experts discussed the hottest trends and topics for 2017.

The mid-year market update was informative, as panelists talked about how Arizona’s multifamily, retail, office and industrial sectors are performing.

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Photos by Mike Mertes, AZ BIG Media. 

The AZRE Forum had three panels. The first two were about Arizona’s retail, multifamily, office and industrial sectors with the final panel focusing on the State of the State.

Last night’s panelists and moderators were:

  • Pete Bolton, Pete Bolton Company
  • Chris Camacho, Greater Phoenix Economic Council
  • John Carlson, Mark-Taylor
  • Dave Cheatham, Velocity
  • Andrew Cheney, Lee & Associates
  • Dennis Desmond, JLL
  • Grady Gammage, Gammage & Burnham
  • Don Garner, Alliance Bank of Arizona
  • Beth Harmon-Vaughan, Gensler
  • Brent Herrington, DMB
  • Scott Maxwell, Cresa
  • Bob Mulhern, Colliers International
  • Mark Stratz, Cushman & Wakefield
  • Sandra Watson, Arizona Commerce Authority

Panelists were optimistic about Arizona, stating that developers haven’t overbuilt new assets in the wake of the recession. There was also talk about how emerging technologies like driverless cars will impact the Valley and Arizona as a whole.

Check out last night’s live blog on the event’s highlight’s below for an overview of the panels:

Final Update: 5:55 p.m.

And the State of the State panel is over. By the looks of it, the panelists are very excited about Arizona. The Tucson area has been seeing some interesting developments in terms of job growth and new companies relocating to the city. The economic developers are optimistic that the planned Lucid Motors manufacturing plant in Casa Grande will happen. The Valley’s downtown cores are getting hot. Camacho thinks the Loop 101 west side could see a lot of users, possibly, if more office spaces are built over there. The developers also expect to see more single-family residential developments along the Loop 303. And, of course, there needs to be more investment in k-12 education.


Update: 5:47 p.m.

The economic developers say we have a very active pipeline when it comes to attracting companies and jobs. There should be some exciting jobs announcements for the Valley, soon. We’ve had some corporate headquarters landing here recently, and it’s an exciting time for economic development.


Update: 5:37 p.m.

Watson says that the Phoenix area is finally at the table, though. Although there are issues with Phoenix, we’re getting the attention of firms that are looking to scale their operations. Those firms can’t scale in California, Watson says, but they can in Phoenix. And those firms are talking to their vendors in a positive manner about Arizona.


Update: 5:28 p.m.

Still, not enough people are thinking about moving to the Phoenix area. It’s not on the radar, even though Phoenix is the fifth largest city in the U.S., now. Harmon-Vaughan says her partners at other locations around the world are shocked Phoenix is the fifth largest city in the U.S. The region is still perceived as an older, “not hip” community. Camacho believes we are becoming hip and cool, despite the perception. Our market is pretty young, Camacho says, and he thinks we’re in the midst of dramatic change and we need to take advantage of it now. Unfortunately, we’re back on our laurels watching the growth. More needs to be done.


Update: 5:28

When it comes to job growth, not many people know about the Phoenix area as a place to locate after they graduate. Cloud companies aren’t thinking about moving to Phoenix, and we’re not talking about data centers, but companies that are operating in the cloud computing space. They’re leaning towards Silicon Valley and Provo, Utah.


Update: 5:20 p.m.

The state of the state panel is focusing on how we’re bringing more companies to Phoenix and how folks will live here. Driverless cars could certainly make Phoenix more dense, and change the region that’s known for sprawl quite a bit. Herrington says building master-planned communities on the fringes of the Valley has become a dicey move, compared to the past. When it comes to building offices and homes, they’re getting built different now too. Folks are spending less money on wiring within their homes, and virtual reality and augmented reality has been getting implemented in offices.


Update: 5:13 p.m.

Will we go cashless? Possibly not, there will be always be cash users, but it’s definitely more data-based.


Update: 5:09 p.m.

Gammage starts off by saying we’re going to be talking about the wall (as part of infrastructure) and technology. Autonomous vehicles are going to be a focus, because they can have a huge impact on commercial real estate and the nation as a whole. Harmon-Vaughan says Phoenix could become a lot more dense with the use of more driverless cars. And as a result, we’ll have to start getting creative with the many parking garages you see around.


Update: 5:07 p.m.

The office and industrial panel has ended, and we’re now moving on to the State of the State panel, which is headed by Grady Gammage.


Update: 5:03 p.m.

Panelists are saying there are office users with a lot of employees. Some of those firms are going build-to-suit. Developers are creating new office product with good absorption, which is good for the economy and commercial real estate. Panelists are saying that we’re not over-built now and there could be continued growth in North Tempe and other East Valley areas. One thing to note, is that a lot of this building is happening without much residential real estate growth.


Update: 5:00 p.m.

The panelists have been focusing on the latest office trends: open and creative spaces in downtown, urban cores. Rents for offices have been going up in recent years, so some of those creative spaces are out of office users’ price range. If you do go creative office space there are going to be a lot of ear buds and conference spaces, because those offices get loud. Some developers want creative office spaces to be fresh, but not trendy.


Update: 4:51 p.m.

The development of the Camelback Collective is great news for Phoenix, panelists say. There are two new buildings going up along the Camelback Corridor, with its first new hotel in the region. Rents in the Camelback Corridor area will be in the $40 range per-square-foot. This is all indicative of an increase of urbanization of the U.S. Phoenix is just like other urban markets with a vibrant downtown and warehouse districts. We’re reaching peak pricing for the urban cores, panelists say.


Update: 4:47 p.m.

Investors have finally been paying attention to the Phoenix area as money pours into the Camelback Corridor area for new office and mixed-use developments.


Update: 4:33 p.m.

Panel one just finished. The mood is definitely a little more pessimistic when it comes to affordability for new apartments due to the high amounts of demand and the increasing costs of construction. Our next panel will be focusing on industrial and office. We’ll be listening out for more information about construction labor, because that certainly would have a sway on new deliveries for a market with increasingly lower vacancies.

 


Update: 4:24 p.m.

Panelists focused on retail and multifamily during the first panel. Due to the ongoing labor shortage, delivery of multifamily projects is at an incredibly slow pace. Remember, Phoenix is looking at a huge apartment unit deficit, according to reports.

As far as retail goes, grocery has a lot of new entrants in that market, so there could be storm clouds in that sector. And we can expect to see a lot of development catering to new quick service style restaurants, which is why folks are tearing down traditional restaurant spaces.


Update: 3:09 p.m.

Tonight, is the AZRE Forum, AZRE magazine’s annual mid-year update on Arizona’s commercial real estate market.

Three panels will go over the latest trends, issues and forecasts for Arizona’s growing market. The first panel will focus on Arizona’s multifamily and retail sectors, focusing on affordability and rental rates in the multifamily market and infill development in the retail market.

The second panel will zero in on Arizona’s industrial and office sectors, with an emphasis on the rise of creative office space and how Phoenix’s industrial assets are performing compared with other markets.

The final panel of the evening will be addressing the State of the State.

Tonight’s panelists and moderators include:

  • Pete Bolton, Pete Bolton Company
  • Chris Camacho, Greater Phoenix Economic Council
  • John Carlson, Mark-Taylor
  • Dave Cheatham, Velocity
  • Andrew Cheney, Lee & Associates
  • Dennis Desmond, JLL
  • Grady Gammage, Gammage & Burnham
  • Don Garner, Alliance Bank of Arizona
  • Beth Harmon-Vaughan, Gensler
  • Brent Herrington, DMB
  • Scott Maxwell, Cresa
  • Bob Mulhern, Colliers International
  • Mark Stratz, Cushman & Wakefield
  • Sandra Watson, Arizona Commerce Authority

During last year’s AZRE Forum, panelists were feeling optimistic about Phoenix’s multifamily and infill developments, and they expected to see more growth in those areas this year as well. Panelists were largely optimistic about Arizona’s commercial real estate industry in the short term.

Some issues that were focused on last year include Arizona’s education woes, and the difficulty of attracting skilled workers to the local construction industry.

We will be updating this article throughout the evening during each of the panels. Join in on the conversation on Twitter by following @AZBIGMedia, and using the hashtag #AZREForum.