Phoenix Industrial Market Report, Q3 2026
A summary of the Maris Advisors Q3 2026 Phoenix Industrial Market Report: the headline figures, the quarter in review and the notable deals. The full report is available on request.
Headline Figures
Executive Summary
Phoenix industrial vacancy ended the third quarter between roughly 9.7% and 11.5%, depending on how vacancy is measured — the same spread as the second quarter, within 50 basis points of the prior quarter on every measure and 150 to 180 basis points below a year ago.
Third-quarter net absorption measures run from roughly 1.6 to 5.4 million SF depending on how absorption is counted — the widest disagreement of any headline figure this quarter; this report uses the 5.4 million SF figure. Year to date the market has absorbed roughly 11.5 to 14.6 million SF.
The pipeline is growing again. Space under construction rose on every measure, to roughly 14 to 21 million SF, after bottoming near 10.6 million SF in late 2025. Third-quarter deliveries of roughly 2.6 to 2.9 million SF remain far below the 2022–2025 pace. Net asking rents held at $1.13 to $1.18 per SF per month, NNN.
Large-block demand came from logistics and AI-related users. DHL's roughly 4.35 million SF across five West Valley buildings and the 1.15 million SF Luke Field leases account for most of the named leasing in this report.
The semiconductor cluster deepened on investment and supplier fronts: TSMC's added $100 billion, Amkor's phase two and Nvidia's prepayment, Nokia's Chandler fab purchase and ASM's Scottsdale headquarters. Closures at Infineon and Pinnacle Transplant show the manufacturing base is not expanding uniformly.
Quarter in Review
The quarter's leasing was a West Valley story. DHL's roughly 4.35 million SF across five buildings — Olive Logistics Center, Northern Parkway, VT 303 North, Park 303 and Latitude 303 — and the roughly 1.15 million SF Luke Field campus lease to an AI-sector user account for most of the named leasing, and six of the eight largest new leases landed in the Glendale–Loop 303 corridor. Behind them, mid-sized deals filled in: Cosic Logistics doubled its Avondale footprint to about 265,000 SF, Marketech took about 151,000 SF in Deer Valley to serve the TSMC campus, and Okland Construction expanded into all of a Deer Valley building for prefabrication.
Manufacturing moved in both directions. TSMC's additional $100 billion commitment, Amkor's second Peoria phase and Nvidia's prepayment for its capacity, Nokia's purchase of the NXP fab campus in Chandler, ASM's 400,000 SF Scottsdale headquarters, Cyclic Materials' 144,000 SF Mesa plant and Clark Pacific's Coolidge groundbreaking all deepened the supply chain. Infineon's Mesa closure and Pinnacle Transplant's Phoenix closure show the base is not expanding uniformly.
New shells kept getting permitted on Tempe infill sites, including former office-park land at Fountainhead Corporate Park, while the quarter's largest permits were at the TSMC campus. The data-center question sharpened: the Attorney General asked for a pause on hyperscale approvals, the Governor opposed a moratorium, and a federal agency's conversion of a Surprise warehouse is paused for environmental review. In our view, power and water availability are likely to weigh more heavily in large industrial and data-center site decisions.
Quarter Comparison
| Metric | Q3 2026 | Prior Qtr | Year Ago |
|---|---|---|---|
| Total Vacancy | 9.8% | 9.8% | 11.5% |
| Net Absorption | 5,450,000 SF | 4,300,000 SF | 7,870,000 SF |
| Deliveries | 2,910,000 SF | 1,920,000 SF | 2,500,000 SF |
| Leasing YTD | 24,600,000 SF | N/A | N/A |
| Avg Asking Rent (NNN) | $1.14/SF NNN | $1.13/SF NNN | $1.13/SF NNN |
Trend
Total vacancy moved from 11.5% in Q3 2025 to 9.8% in Q3 2026.
Submarket Performance
| Submarket | Vacancy | Asking Rent | Net Absorption | Trend |
|---|---|---|---|---|
| Airport | 7.3% | $1.26/SF NNN | +916,000 SF | Softening |
| Northeast | 5.1% | $1.65/SF NNN | +180,000 SF | Softening |
| Northwest | 9.6% | $0.97/SF NNN | +1,830,000 SF | Improving |
| Southeast | 12.5% | $1.20/SF NNN | +1,710,000 SF | Improving |
| Southwest | 9.0% | $0.95/SF NNN | +809,000 SF | Improving |
Notable Deals
Notable Leases
- DHL · Glendale (Northwest) — VT303 North, Bldg A (7842 N Reems Rd) · 1,150,000 SF
- Atkinson Industries · Glendale (Northwest) — Majestic 303, Bldg 1 (17450 W Minnezona Ave) · 392,000 SF
- DPR Construction · SW N of Buckeye Road (Southwest) — Papago Commerce Center · 323,000 SF
- Southland Industries · Glendale (Northwest) — Park Algodon, Bldg B (4275 N 97th Ave / 9602 W Indian School Rd) · 317,000 SF
- DCSL · Glendale (Northwest) — Camelback 303 Logistics Center, Bldg A (16395 W Camelback Rd) · 304,000 SF
- Undisclosed · Goodyear (Southwest) — 150 N Litchfield Rd, Bldg A · 251,000 SF
- Brinkmann Constructors · Chandler N/Gilbert (Southeast) — 4025 S Binary Rd, Bldg A · 204,000 SF
- Magna Steyr USA · Southeast Valley (Southeast) — 7035 E Pecos Rd · 405,000 SF
Notable Sales
- — · 16400/16500 W. Glendale Ave., Glendale · Glendale (Northwest) · 1,110,000 SF
- — · 3607 S. 12th St., Phoenix · South Phoenix (Airport) · 358,000 SF
- ALTOAZ001 LLC · 400 S. 99th Ave., Tolleson · Tolleson (Southwest) · 889,000 SF
- — · 405 N. 75th Ave., Phoenix · West Phoenix (Southwest) · 406,000 SF
- NHNR Hold Co 47 LLC · 6505 W. Chandler Blvd., Chandler · Chandler (Southeast) · 197,000 SF
- Indus Properties V LLC · 670 S. 91st Ave., Tolleson · Tolleson (Southwest) · 418,000 SF
- — · 12460/12730 N. Dysart Rd., Surprise · Surprise (Northwest) · 243,000 SF
- — · 250 E. Elliot Rd./3191 N. Washington St., Chandler · Chandler (Southeast) · 137,000 SF
Square footage only; every other deal figure stays in the full report.
Who’s Winning, Who’s Losing
Who’s Winning
Tenants with mid-band requirements (100,000–250,000 SF): roughly 19% vacancy in the tranche puts concessions, improvement dollars and abatement in play. Tenants able to use sublease space, which rose to about 1.4% of inventory. Occupiers in the Southwest and Southeast big-box corridors, where asking rents slipped 1% to 3% on the year.
Who’s Losing
Large-block tenants who need ready-built space now: buildings over 500,000 SF are roughly 3% vacant, and the next wave in the Glendale–Tolleson corridor delivers from late 2026, the first already fully pre-leased. Tenants in the Airport and Northeast clusters, where rents climbed 3% and 11% on the year. Semiconductor-supply-chain users competing for sites near the north Phoenix fab complex.
Maris Advisors Market Insight
The leverage window for large-block tenants is the pipeline: 14 to 21 million SF is coming back, weighted to the largest buildings, and the first of it delivers in late 2026.
Concentration and bifurcation persisted through the quarter — one corridor produced most of the named leasing, and vacancy by size band runs from about 3% to 19% — but the forward story has changed. After four quarters of a shrinking pipeline, construction is rising on every measure, and the new buildings are the large ones. For an occupier with a 2027 requirement, that is leverage returning on a delivery schedule that is already set; for a mid-band tenant it changes little, because the softness in that tranche was never about supply.
Questions and Answers
What was the total vacancy rate for Phoenix industrial space in Q3 2026?
Total vacancy was 9.8% in Q3 2026.
How much net absorption did the Phoenix industrial market record in Q3 2026?
Net absorption was 5,450,000 SF in Q3 2026.
How did total vacancy compare with the prior quarter?
Total vacancy was 9.8% in Q3 2026, against 9.8% in Q2 2026.
Which submarket posted the lowest vacancy?
Northeast posted the lowest vacancy in the submarket table for Q3 2026, at 5.1%.
Where can I get the full Q3 2026 Phoenix Industrial Market Report?
The full report is available on request from Maris Advisors through the reports page.
The Full Report
The complete Q3 2026 Phoenix Industrial Market Report, with every table and chart, is available on request from Maris Advisors.