The Phoenix retail market in 1Q 2026 shows stable vacancy, steady demand, and ongoing rent growth, even as construction activity continues to slow. Rising asking rents and healthy absorption reflect resilient retailer expansion across the metro, while sales pricing and development pipelines adjust to shifting investment conditions. Explore our full 1Q 2026 Phoenix retail market report for deeper insights and trends.
1Q 2026 Phoenix Retail Market: Key Data Points
- Vacancy Rate Holds Steady: Retail vacancy remained unchanged year-over-year at 4.5%, signaling consistent tenant demand.
- Asking Rents Continue to Rise: Average asking rent grew 6.97% YOY, reaching $1.73/SF/month.
- Construction Pipeline Declines Sharply: Space under construction fell to 2.7M SF, a 22.66% YOY decrease, as development activity cools.
- Construction Deliveries Increase: Deliveries totaled 809,668 SF, up 46.45% YOY, reflecting completion of previously initiated projects.
- Net Absorption: Returns to Positive: Net absorption reached 318,035 SF, a significant jump from 0 SF in 1Q25.
- Sales Pricing Moderates: Average sales price declined to $297/SF, a 12.30% YOY decrease, aligning with broader market adjustments.
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