top of page
Modern Office Space
Search

HOW TO NEGOTIATE TENANT IMPROVEMENT PACKAGES IN PHOENIX METRO SUBMARKETS 2026:

  • Writer: Renee Ervanian
    Renee Ervanian
  • Apr 13
  • 1 min read

Updated: Apr 28

The headlines are changing. Office vacancy rates have significantly decreased. But what Tenant's don't see is that a lot of office buildings are disappearing because they are being torn down and/or converted to residential apartments and condos. Statistics can be misleading. Tenant rep brokers, research and actual absorption numbers are necessary now.
Is Office Demand or Demolition creating a surge in Office Absorption?

VACANCY RATES:

Office vacancy is dropping, but not necessarily because demand is booming. 23.2 million square feet of office space has been demolished or converted to residential condominiums and apartments. Instead of a leasing surge in office, it is more of a structural rebalancing. Tenants still have leverage, especially in Class B and older buildings. because falling vacancies are being driven by building removals, not tenant demand.


TENANT REP BROKERS:

A tenant rep broker is essential for identifying where leverage exists and converting this into tenant concessions.


TENANT IMPROVEMENT PACKAGES - CLASS B BUILDINGS STILL DELIVER FULL MODERNIZATION:

The landlord can fully modernize a Class B vacancy before a tenant takes occupancy. Many landlords will fund a complete tenant improvement package, including updated ceilings and LED lighting, new window coverings, new flooring and paint throughout, and a refreshed, modern break area.


In exchange, the landlord's primary requirement is a long-term lease, which allows a landlord to amortize tenant improvement costs. If a tenant commits to the term, and financials are strong, upfront free rent and favorable lease rates remain negotiable.







COMPLIMENTARY: BEST OPTIONS REPORT
COMPLIMENTARY: BEST OPTIONS REPORT

CONTACT:

Renee Ervanian

Managing Broker

CORE COMMERCIAL LLC

Direct: 602 330 7482


Comments

  • Instagram
  • LinkedIn
  • Facebook
  • X

© 2026. Renee Ervanian PC

bottom of page