Tucson, AZ - Office Market Overview
The Tucson real estate market includes Barrio Viejo, Broadway Northeast, and the Rosemont - Aledea Linda office space submarkets. With a metropolitan population of just over 1 million, the economy in Tucson remains vibrant and robust. A solid mix of government, aerospace, and healthcare business sectors create strong demand for white-collar office employment in the Tucson metro area.
As of mid-2017, the Tucson office market encompasses over 8 million square feet of existing office space in properties larger than 50,000 square feet. Over 41% of this space is Class A or A+, with Class B office space adding another 56% of inventory to the Tucson office market. In addition to being home to two military bases, a large number of high technology businesses are also attracted to the area, maintaining robust and predictable demand for commercial real estate in Tucson, AZ.
Tucson, AZ - Office Inventory Description
One of the main employers and economic drivers in Tucson is the University of Arizona. The U of A attracts a large number of R&D and government contractors to the area, which in turn creates an on-going need for Class A office space in Tucson. With a gross metropolitan product of nearly $41 billion annually, the demand for white-collar office space is consistent. There are over 70 office buildings in Tucson that are larger than 50,000 square feet.
The Highland Vista Cinco Via office submarket is one area of Tucson that sees strong demand for office space. Located north of Broadway Boulevard and west of North Craycroft Road, this area is home to investment-grade office buildings such as 5151 East Broadway, the 155 North Rosemont Blvd office building, and the 4801 East Broadway Blvd office project.
Tucson City, AZ Commercial Inventory Breakdown
Total: 11,452,711 SF
By square footage range:
- 50k to 100k SF: 4,336,135 SF / 37.86% of total office
- 100k to 500k SF: 7,116,576 SF / 62.14% of total office
- Class A: 3,710,415 SF / 32.4% of total office
- Class B: 5,630,837 SF / 49.17% of total office
- Class C: 651,459 SF / 5.69% of total office
Tucson, AZ - Green Office Space
The most recent National Green Building Adoption Index, completed in 2017, analyzed the top 30 office markets in the U.S. to quantify the market share of energy efficient, green office space. The survey discovered that since 2005, the overall percentage of LEED-certified, EPA Energy Star-rated, and green office buildings has soared to 38%, up from 5% back in 2005.
While Tucson does not rank as one of the top 30 U.S. office markets, the city is making marked progress in increasing its market share of green office buildings. A great example of this is the QIP Office Building on 3601 N. Business Center Drive. This 85,000-square-foot office building received its first green label in 2009 and currently holds a LEED Platinum certification for energy-efficient design, water use reduction, and sustainable site selection and development. In Tucson overall, 3% of the larger office buildings are green, with almost 326,000 square feet of green office space in Tucson, AZ.
Tucson, AZ's Top Office-Using Sectors
While the city may not rank as a top 30 office market, the Tucson office market continues to be strong, thanks to an energetic mix of businesses and industries. Among the top office-using sectors in Tucson are the education, government, healthcare, and aerospace sectors.
- Education – The University of Arizona is one of the city's largest employers, and consistently attracts high technology, bioscience, and research & development businesses that create white-collar employment and drive demand for office space in Tucson.
- Government – Davis-Monthan Air Force Base, Pima County, Fort Huachuca, the U.S. Army Intelligence Center, and the U.S. Customs and Border Protection agency create significant employment in the Tucson metro area.
- Healthcare – Demand for office space in Tucson is also driven by institutions such as Banner University Medical Center Tucson, Sanofi-Aventis, and Ventana Medical Systems.
- Aerospace – Texas Instruments, Universal Avionics, Honeywell Aerospace, and Sunquest Information Systems all help to generate demand in the Tucson office space market.
- Total Population530,905
- Male Population(49.8 %) 264,469
- Female Population(50.2 %) 266,436
- Median Age33.40
- Average Household Income$52,974
- Median Household Income$39,617
- Median Income Under 25$20,761
- Median Income 25-44$42,497
- Median Income 45-64$46,449
- Median Income Over 65$36,264
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