Phoenix Retail Demand Diminishes During Coronavirus Pandemic

Article originally posted on CoStar on June 30, 2020

Monthly leasing volume tumbled in March, following healthy activity earlier in the year. (CoStar)

Phoenix retail demand dramatically pulled back since March, when the pandemic rocked the market. Retail was one of the hardest-hit commercial sectors due to an abrupt stop in economic activity and a curtail in consumer spending. Many retailers closed their operations temporarily and some were forced to shutter their stores for good. In Phoenix, monthly leasing activity has averaged near 480,000 square feet over the past three years. That momentum carried into the first month of 2020, but tumbled in the months after.

April resulted in the lowest level of monthly leasing activity since the Great Recession, totaling just under 156,000 square feet. The period coincides with Arizona’s adoption of a statewide stay-at-home order that spanned from the end of March through mid-May. In preceding months, leasing edged up, but not by much. In June, leasing totaled about 213,000 square feet. That number could rise over the next few weeks, as CoStar research collects and inputs June deals.

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