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PHOENIX-Demand for industrial space across the Valley has created positive absorption in nearly all submarkets. In the second quarter, 3.1 million sf of industrial space was absorbed, eclipsing the absorption recorded for 2004, according to a recent report by Cushman & Wakefield of Arizona Inc.

According to Cushman & Wakefield director Pat Harlan, demand is coming from new companies entering the market and existing companies that are now growing. "We anticipate that 2005 will end with direct net absorption of at least eight million sf," he says. The Valley's industrial inventory totals 250 million sf.

Most absorption occurred in the North Tempe submarket, which drew down more than one million sf, according to C&W. The Far Southwest Phoenix and Southwest Phoenix submarkets followed with 790,092 sf and 871,163, respectively. Northwest Phoenix was the only submarket with negative absorption, 68,495 sf in the red.