As we enter the second half of 2017 the market is picking up with vacancy rates dropping .5% from last quarter. As vacancy rates are dropping and demand continues to increase we are predicting rental rate increases, especially in the northwest and downtown industrial markets. Within the next year or two as rates start the climb we will see developers start to break into the Tucson market. It's an exciting time in the market and we look forward to a healthy industrial market.

​Here are a few new Fisher listings, 

INDUSTRIAL – 2112 N. DRAGOON ST., TUCSON
Skyline Assayers & Laboratories leased 3,000-square-feet at 2112 N. Dragoon St., Suites 1-3 in Tucson, from Rich Rodgers South, Inc.  Max Fisher, with Cushman & Wakefield | PICOR, represented the landlord and the tenant in this transaction. 

INDUSTRIAL – 6894 N. CAMINO MARTIN, TUCSON
Grace Retreat Foster Care and Adoption Services Corporation leased 1,500-square-feet in Old West Business Park, 6894 N. Camino Martin, Suite 100 in Tucson, from Camino Martin Partners II, LLC.  Cushman & Wakefield | PICOR Industrial Specialists handled this transaction.  Max Fisher represented the tenant, and Brandon Rodgers, CCIM, Principal, represented the landlord in this transaction. 

INDUSTRIAL – 2112 N. DRAGOON ST., TUCSON
Arison Construction, LLC leased 1,000-square-feet at 2112 N. Dragoon St., Suite 24 in Tucson, from Rich Rodgers South, Inc.  Max Fisher, with Cushman & Wakefield | PICOR, represented the landlord and the tenant in this transaction. 

INDUSTRIAL – 3959 E. SPEEDWAY BLVD., TUCSON
Draeger Safety Diagnostics, Inc. leased 794-square-feet of office/warehouse space in Central Point Business Plaza, 3959 E. Speedway Blvd., Suite 317 in Tucson, from Central Point Tucson, LLC.  Jeff Zellet, Commercial Specialist with Cushman & Wakefield | PICOR, handled this transaction.  

To read the entire report, click the link below 

realestatedaily-news.com/tucson-lease-report-july-3-7-2017/?utm_source=MadMimi&utm_medium=email&utm_content=We+do+the+Research+-+You+do+the+Deals%21&utm_campaign=20170707_m140258552_We+Do+The+Research+-+You+Do+The+Deals%21&utm_term=Tucson+Lease+Report+July+3-7_2C+2017

In our Tucson Industrial Market we have two main types of leases, NNN and MG (Modified Gross). Over the past month I have had prospective tenants very confused with NNN lease rates and in some cases, upset. The NNN lease rate is typically around $.20 lower than the more common, Modified Gross lease rate and can be deceiving in some cases and that's why it's helpful to understand what you're getting with each type of lease.

In simplest terms, the NNN lease rate (in most cases) does not include property taxes, common area maintenance charges, building insurance, water, and trash. The Modified Gross lease rate (in most cases) does include, property taxes, building insurance, common area maintenance charges, water, and trash. After paying the NNN rent the tenant will have to pay NNN fees (common area maintenance charges, water, trash, property taxes, insurance, etc). A tenant that occupies 10,000 SF of a 100,000 SF building will pay for 10% of the total NNN fees. 

In the Tucson Industrial Real Estate Market NNN leases are much more common in larger spaces (5,000 SF and up) than smaller spaces. 

Here's an example of a couple lease rates that you may see;

MG rate: $.68 per sf
NNN rate $.48 per sf with NNN fees at $.20 per sf

Notes, the NNN lease rate doesn't always advertise the NNN fees so always make sure you request the NNN fees before signing a lease. 

Have any questions? Email me at mfisher@picor.com