Reasons why your Phoenix area lease
price should be lower:

Office vacancy rates in some Phoenix area submarkets are exceeding 23%.

There are significant office and warehouse projects with few signed tenants. We know who needs Tenants.

Mortgage, real estate, and related financial companies have shrunk, and this has made a lot of sub-lease space available.

Individual Office condo owners that bought i.e. 5,000 sqft, and only using 2,500 sqft for themselves, have a 50% vacancy factor. Many office condo owners lack the money to complete the interior of their buildings.

With commissions and remodel costs, it costs a Landlord at least 8% of the lease value to replace a current paying tenant.

Newer buildings tend to have larger blocks of space to fill than older buildings. Knowing when a space can be divided can spur big savings.

The value of premium locations decrease as budgets tighten.  Efficiency and price grow in importance to tenants. Look for properties on the "edge" of markets to feel greater pressure.

Tenants should gauge the vacancy in their current building.  Look for increasing vacancy as an opportunity to renegotiate even a long standing deal.

Landlords tend to be slower to recognize area changes and demand/supply factors until their rent checks slow down and their building drops below 80% occupancy. Knowing a buildings current status can help negotiations greatly.

There is a difference between having tenants and having paying tenants, particularly when it comes to operating costs.

Knowing what other property is available and the momentum of the market will give a strong
negotiating advantage.

METRO PHOENIX COMMERCIAL OFFICE SPACE PROFILE

• By the year end 2008, vacancy, inclusive of all office buildings is pushing past 16%. It is moving up quickly. Data bases calculations show NEGATIVE absorption for the first time in years. Tenants are decreasing their space size and looking for value.
• 1.5 million square feet of new office space has come on-line, and more is still being built.  This is raising the vacancy rate north of 16%.  Warning signs for owners/developers, means opportunities for tenants and buyers. The slowdown in residential real estate has reached the commercial areas.  Real estate related businesses will continue to shed employees, which yields to more vacancy. T
• The existing size of the combined market is over 134 million square feet  
• The highest vacancy rates are in the Northwest and west portion of the valley, but stress is occurring in North Scottsdale too.

• The Greater Phoenix average rent rate is statistically hovering near $23 per foot per year, based on a full service lease. Many deals are being done way below that price now!!!  Call us to find out who is offering bargains.
  
  LONG TERM MARKET VIEW IS POSITIVE

• The Morrison Institute at Arizona State University in conjunction with research from Metropolitan Institute at Virginia Tech, issued a substantial report defining Central and Southern Arizona as the "Sun Corridor" of the new century.  It is one of twenty "Megapolitan" areas identified across the USA.   These megapolitans are expected to have the majority of growth in both jobs and population over the next few decades.   The Phoenix/Tucson megapolitan had nearly 5 million people as of 2005.  The population is expected to exceed 7.8 million people by 2030 !!!   Job growth will go from 2.4 million today, to over 4.5 million.   On a national basis, Arizona is expected to grow faster than any other State and area.

Call the Tenant Agent, Jeff Jennings, for free leasing help.
 602-265-4600

Metropolitan Phoenix Area Map