PHOENIX—It's good news for the Phoenix medical office market as momentum was gained in the fourth quarter, with net absorption reaching nearly 100,000 square feet. The year totaled more than 120,000 square feet net absorption and marked the fourth consecutive year of positive net absorption in the local medical office market, according to a Colliers International fourth quarter report.

While vacancy is still elevated, it is slowly improving and nearing a five-year low. The healthcare segment of the economy continues to respond to changing conditions associated with the Affordable Care Act. But demand is expected to grow based on population growth and expansion of healthcare employment.

Healthcare employment continues to expand rapidly. During the fourth quarter, 4,800 healthcare jobs were created, making the total for the year 9,300 new workers in the field—accounting for more than 20% of all employment growth in the Valley in 2013.