A recent Kidder Mathews survey shows that although leasing volume picked up over the last year, the office market experienced a weakened demand in the second quarter of 2022, down almost 37% since Q1 of this year. In addition, the construction pipeline has slowed a bit with fewer new deliveries than in the past few years. Two million square feet of new supply are expected before year end.

Office investment in the Phoenix has stayed steady. Medical offices are being sought out, in particular, for their stability and safety among the uncertainty surrounding the onset of the foreseeable recession.

The development pipeline is at its lowest levels in over 10 years, which should help keep vacancies from increasing notably in the near future.