Phoenix commercial real estate sales accelerated in 2025 Article originally posted on CoStar on March 9, 2026 Sales volume for Phoenix commercial real estate properties increased 13% year over year to about $14 billion in 2025. This marks the second consecutive year with accelerating deal flow, building on 2024’s 33% gain. The pickup in investment activity was broad-based, with each of the four primary property classes posting increases last year. The retail segment led the way, climbing 21% annually to about $2.4 billion in 2025. Phoenix was one of the top 10 best-performing retail markets in the U.S. last year, as more than a decade of limited construction converged with steady underlying demand drivers to support healthy performance. Vacancy ended the year at one of the lowest levels on record, and the Valley consistently ranks among the nation’s leaders in rent growth. Though retail saw the swiftest acceleration last year, the sector still ranked third in total sales, comprising about 17% of commercial real estate investment. Multifamily and industrial continue to dominate sales volume, cumulatively accounting for about 70% of investment in 2025. While both sectors posted double-digit year-over-year increases, industrial retained the top spot last year in sales volume, after unseating multifamily as the Valley’s preferred property class in 2024. Previously, apartments led all property types in sales volume every year since 2012. About $5.1 billion worth of Phoenix industrial properties traded hands in 2025, up 11% from the previous year. A surge in construction over the past few years has brought a fresh crop of large, modern industrial facilities to the market, attracting strong buyer interest. The Valley saw five single-building industrial transactions of $100 million or more in 2025, including owner-user deals by Walmart at $152 million and Dollar Tree at $147 million. The multifamily sector recorded the second-fastest improvement, with sales up 15% year over year to $4.5 billion in 2025. Similar to industrial, the Valley’s apartment market has been contending with a wave of new construction over the past few years. While increased competition from new supply caused vacancy to rise and turned rent growth negative, it also expanded the inventory of institutional-grade apartments, stoking big-ticket buying activity. Newly built properties captured the bulk of apartment sales volume in 2023 and 2024, and while new construction is still trading at a steady clip, investment for older vintage properties returned in 2025, supporting higher overall multifamily sales. Finally, sales for Phoenix office properties also accelerated as improving fundamentals and pricing stability brought buyers back to the sector. About $2 billion worth of office properties were sold in 2025, an 8% increase from the year before. Private investors and owner-users drove the rebound in sales. With prices down meaningfully from peak levels, these buyers are often attracted to the discount to replacement value that many office buildings can be acquired at. Additionally, the comparative strength of medical office buildings has maintained a steady flow of deals in the subsector. Moving forward, there is some optimism that 2026 could be another year of increasing commercial real estate sales volume. Supply-and-demand fundamentals are forecast to remain stable or show incremental improvement across all property classes in Phoenix, which could give buyers greater confidence and support dealmaking.