By Recker McDowell —
Tempe is still very much the center of economic activity and growth in the region.
Tempe has a 2.8 percent office vacancy rate, according to commercial real estate brokerage firm CBRE. It also has more than 1.1 million square feet of office space under construction.
Tempe accounts for 45.5 percent of all the new office space under construction in the Valley.
By comparison, central and southern Scottsdale have 370,000 square feet under construction and a 11.3 percent vacancy rate.
The regional office vacancy rate is 14.9 percent, according to CBRE.
Tempe has seen office and job growth during the current economic expansion. That includes growth in its downtown area near Arizona State University as well as along the Loop 101 freeway where JPMorgan Chase is relocating jobs from downtown Phoenix.
When international brands and growing companies want office space, they usually want it now and they aren’t willing to wait around. Companies might want to land in Scottsdale, the Biltmore area or on Chandler’s tech heavy Price Road Corridor. But if the right amount space isn’t available or at the ready, most tenants won’t wait around and will find their needs filled elsewhere.
That has led companies to land in Tempe, Chandler, Gilbert and the Salt River Pima Maricopa Indian Community.
Scottsdale-based Harkins Theatres, for example, is building a new headquarters on Salt River land just across from Scottsdale. McKesson also moved its growing Arizona footprint from Scottsdale to the Salt River.
Tempe has benefitted from its proximity to Arizona State University and its Mill Avenue amenities appeal to employers and their workers. But Tempe also has the Class A office space employers need and want.