Western

— By Jason Price of Commercial Properties Inc./CORFAC International — The Phoenix office market continues to show balance as leasing patterns shift and tenants prioritize smaller footprints. The metro’s office inventory totals 195.5 million square feet across roughly 9,000 buildings. Construction has edged upward year over year, with a little more than 900,000 square feet currently underway compared with 844,000 square feet a year ago. Another 1.5 million square feet is expected to deliver between 2025 and 2026, a restrained pace that should help prevent oversupply. This discipline has become critical as companies continue to right-size and lenders remain cautious. The overall market faces slower demand for large contiguous blocks, limited financing availability and an elevated level of sublease inventory that will take time to absorb. Most of the sublease space consists of second-generation Class A and B product in downtown and the Camelback Corridor, where tenants are evaluating long-term space requirements before recommitting. Even so, Phoenix’s fundamentals remain relatively healthy compared with many other metros. The city’s diversified economy, steady population inflow and expanding employment base continue to support leasing activity, particularly for move-in-ready suites of less than 10,000 square feet. Small-business confidence and the return-to-office movement among local …