Christie Smythe of the Arizona Daily Star reports that the economy is showing an impact on the comercial real estate market.  However, the office market, according to Tucson Realty and Trust Co., is improving.  The office-vacancy rate for Tucson is on the way down after a rise in recent months.  Currently, it’s at about 13%, but incentives like a free month’s rent are starting to disappear. Does this mean the office market has bottomed out and is recovering?  This change in status contrasts with the markets for industrial space, retail space, apartment buildings, and commercial and residential land, Tucson Realty and Trust representatives said.  Vacancy rates for retail and industrial properties are rising, at least partly as a result of more space being built in both those categories.    Although retail vacancy is around 8.5% with greatly varying rents, about 1.7 milllion square feet of retail space is to be built in Tucson this year.  But some of that building may be delayed because of a slower economy and tighter standards for borrowing.  George “Hank” Amos III, president and chairman of TRT thinks that conditions in those markets may start to improve by the middle of next year, depending on whether the housing market picks up in the spring.  The National Association of Realtor (NAR) forcasts a market recovering in the latter half of this year.  Currently in Tucson, sellers and landlords are willing to negotiate.  Whatever market you may be interested in, according to our local statistics, now is the time to buy or lease. 

Denise