Real estate expert says we may not see COVID-19’s impact on Arizona’s commercial real estate for some time
Commercial property prices appear to be stable in Arizona
Commercial property prices are falling across the country as people stop going to offices due to COVID-19 lockdowns.
PHOENIX – – The structure of many companies has changed dramatically since the ongoing COVID-19 pandemic in March 2020, and this is especially true for those who work in offices.
Due to the pandemic, many people have stopped entering offices and retail stores have closed, some even permanently, during the lockdown. As a result of these changes, commercial property prices are falling in parts of the country.
In Arizona, however, the state’s commercial real estate market is not yet in sharp decline.
On Jan. 4, FOX 10 spoke to commercial real estate agent Aaron Dutcher, who said people may not see the effects of the pandemic on commercial real estate for some time.
Commercial real estate deals have stalled, Dutcher says, but leases remain stable.
“We had a lot of seizures and starts,” said Dutcher. “We got a lot of investors saying, ‘I’m ready to go, let’s do this,’ and then we got the property and signed it, and then we got cold feet. ‘Well, let’s wait until after the election. The vaccine said it was coming and now it wasn’t. You know what? Let’s just cancel the deal, let’s wait. ‘”
Office and retail space are the hardest hit, according to Dutcher.
“The bigger restaurants with the bigger footprints and overhead, 5,000-square-foot restaurants, are just getting really hammered and we see these closings pretty regularly,” Dutcher said.
On the other hand, industrial rooms do not see any negative effects and are even in great demand.
When it comes to office space, Dutcher says people won’t know the long-term effects for some time, but he knows that property owners need to influence the way they market their space.
“Office space without a personal fitness center or coffee shop will now have personal fitness centers and coffee shops,” said Dutcher.
Some of the hardest hit areas are places like New York and California, which is a plus for Arizona. According to Dutcher, many companies are planning to relocate to Arizona, especially those from California. He says that’s because many places in California are still closed.
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