Phoenix is the capital of Arizona and one of the fastest-growing cities in the nation. It’s the largest city in the state and is more than twice as big as Tucson, Arizona’s second-biggest city. Locals enjoy the desert character mixed with big-city opportunities. The Salt River Valley includes the Valley of the Sun, which includes the Phoenix metropolitan area, which is anchored by Phoenix. Though agriculture used to be the city’s biggest money-maker, now it is center for sales, technology, transportation, and military operations.
The Greater Phoenix area is host to a range of global businesses, including Avnet, Freeport-McMoRan, PetSmart, and Republic Services. Other companies with headquarters or offices in Phoenix include Honeywell’s Aerospace division, Intel, U-HAUL International, Best Western, Apollo Group, Uber, Taser (now Axon), and General Dynamics.
Phoenix Office Space | Lease Data and Trends
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The Phoenix metro boasts a robust commercial real estate inventory, with more than 100 million square feet of space spread between the Central Business District and surrounding suburbs. Vacancy rates of 19% in the Downtown core and 15% in the suburbs mean tenants have options to compare, and there is healthy competition between landlords to fill spaces.
Across the Greater Phoenix area, Class A space costs around $31 per square foot (per year) to rent. Class B space is available at an average of $21 per square foot. Class C assets are limited, with average asking rents of less than $20 per square foot. In addition to lease length, building class, and tenant concessions, lease prices vary depending on location throughout the city.
Leasing activity in Phoenix remains strong — recent notable leases include:
- General Dynamics leasing 149,000 square feet in Metrocenter
- ASU leasing 60,000 square feet at One Arizona Center Downtown
- Amazon leasing 53,000 square feet in North Tempe
- AZ Children’s Association leasing 40,000 square feet in Midtown
What Our Brokers Say About Phoenix Office Space
Phoenix rests in the south-central part of Arizona between Tucson and Flagstaff. It is approximately 516 square miles—or 1,341 square kilometers—in size and has a low population density despite being the fifth-most populous city in the nation. Phoenix is surrounded by mountains, but the city itself is mostly flat and includes plants and animals from the Sonoran Desert, which stretches from Arizona into parts of California and Mexico. The Mexican border is just a 150-mile drive away.
Notably, Phoenix residents do not observe daylight savings time to save energy and prevent school-aged children from having to travel to school in the dark. For this reason, in Phoenix, the sun rises at 7:29 a.m. on Dec. 21 and at 5:19 a.m. on June 21.
Popular Neighborhoods to Rent Phoenix Office Space
Phoenix is a very large city. When deciding where to look for office space, it helps to look at characteristics and pricing for individual locations to determine where might be best for your business to put down roots. Here are some of the city’s most popular neighborhoods and areas.
Downtown: Downtown Phoenix serves as the city’s central business district. This neighborhood is an important center for professional sports, politics, government, and finance. Regional headquarters for JP Morgan Chase, Wells Fargo, US Bank, and Bank of America are all here. Office space here costs about $32 per square foot to rent. Most of it is Class A, though Class B and Class C spaces are available.
Central City: Central City is an urban village located in Phoenix’s historical center. It is home to the Sky Harbor International Airport, and boasts nearly 10 million square feet of total commercial real estate inventory.
East-Central Phoenix: East-Central Phoenix comprises a variety of neighborhoods in the Phoenix metropolitan area. Office spaces are very affordable here and only cost an average of $15/sqft to rent. Currently, 13% of spaces are available to rent.
West Phoenix: West Phoenix, or West Valley, is a region of Phoenix said to include Avondale, Buckeye, Glendale, Peoria, Tolleson, and more. Here, office space costs about $18/sqft to rent, though cost varies depending on location within the area.
Sky Harbor: This neighborhood is named for its inclusion of the Phoenix Sky Harbor International Airport, which is the state’s largest airport. Located only three miles from Downtown Phoenix, this airport fields more than 1,200 aircraft operations each day. Sky Harbor is more than just an airport, though: it houses nearly 5 million square feet of office space. Commercial space in Sky Harbor costs about $20/sqft to rent.
Camelback Corridor/Camelback East Village: Camelback East is one of Phoenix’s 15 villages. It’s located next to the suburbs of Paradise Valley and Scottsdale near Camelback Mountain. Office space is slightly more expensive here, at $31/sqft.
Mesa: Mesa is a city in Arizona that rests about 20 miles east of Phoenix. It is the state’s third-biggest city after Phoenix and Tucson. Mesa is home to many historic properties that have been listed in the National Register of Historic Places. Mesa leans heavily residential, with less than a million square feet of office space for lease.
Scottsdale: Scottsdale is a desert city in Arizona that’s known for its high quality of life and its high-end shopping options. Businesses seeking office space for rent should expect average asking rents between $25 and $35 per square foot. Spaces near the Scottsdale Airpark and South Scottsdale tend to lease for higher prices than Central Scottsdale.
Tempe: Tempe is a city in Phoenix’s East Valley area. Insight Enterprises, a Fortune 500 company, has its headquarters here. Tempe is also the home of Arizona State University. In Tempe, businesses can expect to pay about $34/sqft to rent office space. Most of it is Class A, though Class B and Class C spaces are available.
Transportation in Phoenix, AZ
Many people drive personal vehicles to work and to get around Phoenix because the city ranks first in the United States for urban freeway quality, and traffic just does not get congested the way it does in other big cities. Local funds have ensured the city enjoys an impressive network of freeways people can choose from. Getting around is simple because most of the highways go either north to south or east to west. Freeways and state highways serving Phoenix include Interstate 10, Interstate 17, State Route 51, U.S. 60, State Route 85, Loop 101, State Route 143, Loop 202, and Loop 303.
Though carpooling is a popular way to get around, Phoenix does have some public transportation opportunities. Passengers can take trains Texas Eagle or Sunset Limited or ride Amtrak Thruway buses from the Phoenix Sky Harbor International Airport to Flagstaff. Another bus choice is Greyhound. Valley Metro provides trains, buses, and a ride-share program in the metropolitan area. Phoenix is also a bicycle-friendly city.
Two large airports—the Phoenix Sky Harbor International Airport and the Phoenix-Mesa Gateway Airport—serve the city. Smaller airport options are Phoenix Deer Valley Airport, the Scottsdale Airport, the Glendale Municipal Airport, Falcon Field Airport, and Phoenix Goodyear Airport.