Phoenix leads the nation’s industrial market with nearly 41.6 million square feet of active construction projects, comprising 10.9% of the national total, driven by efficient cost management and increased subcontractor participation. Despite a slowdown in office construction, Phoenix saw a surge in office investment, ranking among top markets. The construction industry in Arizona maintains high demand for workers, with a decrease in the state’s unemployment rate to 4.1% in February 2024. Material pricing is stabilizing in 2024, although challenges persist in specific categories like drywall. Supply chain disruptions are easing, contributing to a potential “soft landing” in inflation and potentially boosting construction activity with the Federal Reserve considering halting rate increases.
