Since 2009, the U.S. economy has had more than 110 consecutive months of growth, making this the second longest economic expansion since the Great Depression. After a rather tepid 2017 performance, the U.S. office market gathered some steam in 2018, adding 76 million square feet of new office space and completing roughly 396 new projects in its top 40 most active markets for office completions.
Using Yardi Matrix data, COMMERCIAL Café examined what 2019 may have in store for the U.S. office market. According to numbers recorded up to April 9th, on a national level 662 buildings and a whopping 115 million square feet of new office space are on track for delivery this year. While some reports raise concerns about how the pace of development will be affected by tariff and trade wars, growing construction costs and labor shortages, the office sector is expected to hold up better than it has in earlier downturns. This is mainly due to more restrained lending practices, a more moderate pace of development and the concentration of new office properties in markets with significant job growth.
How did Phoenix fare? Here are a few key takeaways from the COMMERCIAL Café report:
• With 4.3 million square feet across 41 projects, Phoenix is the ninth market for office delivery in 2019. NYC, which expects 16 million square feet of new office space, is the first;
• The 356,000-square-foot Allred Park Place – Orbital ATK – Office in Chandler is the biggest project to be completed in the Phoenix market this year;
• In comparison, last year Phoenix added roughly 993,000 square feet of new office space to the market.
