PHOENIX—Things are heating up in the Phoenix metro area. There are clear patterns that seem to be emerging around the country as cities revitalize around a new tenant base, such as technology or medical office, which are supplanting more traditional occupants, at least for now. The core Phoenix market is certainly holding its own, reports Andy Weflen. For the eye-popping transactions, however, you've got to look to the outer regions of the metro – to Tempe, Scottsdale and Chandler, AZ.

According to Weflen, the Phoenix and Las Vegas regional director of analytics for GlobeSt.com Thought Leader Xceligent, Arizona's Urban Heart is actually benefitting from a mix of new and, if you will, older, or more traditional activity.

“People are trying to get in while the getting is good,” he tells GlobeSt.com. That includes the likes of State Farm Insurance, which is building a reported $600-million facility in nearby Tempe, as well as Northern Trust Co., which is bringing in more than 1,000 jobs to a new 450,000-square-foot facility it's also building in Tempe.

“What's interesting is that the Northern Trust project is going to be within a mile of web-hosting firm GoDaddy's new headquarters,” he points out. And just four miles north are Intel's operations and a new GM Innovation Center. “So, it's been an interesting mix of tech and finance.”

GoDaddy, by the way, is not the only web company focused on the Phoenix metro. In Scottsdale, cloud-based HR firm Zenefits has announced plans for 100,000 square feet, and web developer Weebly took 250,000 square feet in the same building, creating a sort of one-asset tech hub.

From Q4 2014 to Q1 2015, metro rents have not jumped tremendously, but still the demand is clear in rates. Weflen reports a range from $21 to a high in the $30s for class A.

On the sales side too, there's been what Weflen terms “excitement over such transactions as the sale of Esplanade III, which Crow Holdings Capital Partners just bought for a little over $74 million. There's another building in Camelback Square that was purchased by a private REIT in Dallas, it's first in the Phoenix market.” The asset sold for $42.3 million, he says.

With a surge in tech comes a surge in younger population, and smart firms are drawn to the built-in workforce provided by Arizona State University's Tempe and Downtown Phoenix campuses. “It's just a natural conclusion that companies are moving there to tap that talent right out of college,” says Weflen. “They want cool space to work in.  And they also want cool stuff – interesting and unique restaurants, shops and other amenities – the whole live-work-play dynamic. ”

And the metro provides just that, not only with new office space going up as reported above, but the Phoenix Downtown itself is reacting to the influx of Millennials, especially, reports Weflen, with the “adaptive re-use of older buildings for new retail purposes.” Developers are “exposing brick and wood beams and putting in new boutiques and cool restaurants to attract that live, work, play population.”

Not surprisingly, multifamily is hot, and, concludes Weflen, “Apartment builders are seeing the influx of major corporations and planning accordingly, with major developments both in the Phoenix CBD and in Scottsdale and Tempe.”