Phoenix MSA Updates, October 2021
Which States are Migrants to Phoenix Coming From
According to George W Hammond of AZ Big Media, the latest five-year census for the 2015-2019 period shows that Arizona got 266,648 migrants from states in the US for each year. This figure only represents people coming into the state and is not inclusive of people moving out. 172,606 of these migrants went to the Phoenix MSA, and 37,937 went to the Tucson MSA.
They came from areas like California, which sent the most migrants to the Phoenix MSA than any other state. Migrants from California made up 22.6% of overall migrants in Phoenix and 20.9% for Tucson. The other states with many migrants to California included Washington, Texas, Illinois, and Colorado. Arizona drew in most of the migrants from Western states, 137,054 in total (51.4%), 55,754 (20.9%) from the Midwest, and 55,627 (20.9%) from the South and 18,213 migrants or 6.8% from the Northeast.
Phoenix is One of the Most Innovative Cities in the World
AZ BigMedia recently presented the findings of a study by FINOM.de, B2B financial service of the most innovative cities in the world. Phoenix was ranked as No.51 out of 100 areas.
FINOM is a company that is using modern technology to improve business and entrepreneurship in Europe. They created the Business Index to see which cities are leading in business innovation.
The cities were critiqued based on “Innovation Areas” and “Industries” as the two main categories. The “Innovation Areas” of focus include Venture Capital Funding, Startups, and Tech Ecosystem. At an Industry level, the areas focused on include Education, FinTech, Retail, and Travel. San Francisco was number 1, with Beijing in second place and Sacramento after Phoenix at number 61O
"Arizona's unemployment rate is now below 6%, the lowest it's been since March of 2020. Arizona has seen a 2.9% increase in labor force size since last year, which shows the strength and resiliency of the workforce." (AZ Commerce Authority)
Arizona Bounces Back from Pandemic Losses
Arizona has regained several of the jobs that were lost as a result of the pandemic. George W. Hammond of AZ Big Media reports that in July, the state replaced 93.7% of the positions lost from February to April 2020, where Arizona was short of many jobs of the previous peak period. Arizona’s unemployment rate is now below 6%, the lowest it’s been since March of 2020. Arizona has seen a 2.9% increase in labor force size since last year, which shows the strength and resiliency of the workforce (AZ Commerce Authority).
Home price appreciation in Arizona has been affected by a mixture of supply and demand factors. Home inventories are low and have been down since 2007 but saw an all-time low in the pandemic. Other issues include high prices of material which has affected construction costs.
On the demand side, we can see where more people from states are looking to purchase homes in Arizona, where houses are relatively affordable.
Arizona is forecasted to have strong growth in jobs, income, and population. Arizona’s population is expected to reach 10 million by 2051.
Intel Will Open Semiconductor Factories
Intel will open two new semiconductor factories in Chandler, southeast of Phoenix. According to AZ Big Media, the two fabrication facilities will be on Intel’s Ocotillo campus. This investment will create more than 3,000 jobs in high-tech, high-wage jobs, and 3,000 construction jobs and at the same time support 15,000 extra indirect jobs.
There is a global demand for microchip technology, and Arizona has risen as the number one location for new semiconductor investments. The multibillion semiconductor manufacturer sector employs over 22,000 people in Arizona with over $8 billion wage impact. When the fabs are in full operation in 2024, they will make Intel’s advanced process technologies.
Emerge has Raised $130 Million and Plans to Hire Many
Andy Blye reports that Scottsdale-based tech company Emerge made $130 million in series B funding. The four-year-old company is ready to create a technology that will significantly benefit the freight industry. Emerge has an online marketplace that connects shippers to carriers driving across the country.
The company made $85 million in revenue in 2020; however, they are looking to make between $250 and $300 million this year. The persons who will join the team from the massive hiring initiative will include salespeople to bring the Emerge name across to the carriers.
Phoenix Suburbs are Attracting More Renters
The AZ Big Media reports that more people are being drawn to the Phoenix suburbs. Within the Greater Phoenix Area, El Mirage had the highest growth, with renter share moving from 29% in 2010 to 20% in 2019. In comparison, Sun City, which has the lowest renter share, saw a move from 14% to 18% within the ten years. Other areas that saw growth in their renter population by the end of 2019 include Scottsdale that moved from 26% to 32%.
More people are renting in the suburbs across the US. Between 2010 and 2019, suburban renters in the US grew by 22%, while suburban homeownership only increased by 3%. Since 2010, renters have dominated 103 suburbs while four suburbs became owner-majority during the same timeframe. There are 242 renter-dominated suburbs from 1,105 of the suburbs analyzed in 50 of the country’s largest metros.
Master Plan Community to be Launched in Phoenix’s West Valley
According to PR News Wire, a massive Master Plan Community (MPC) called Douglas Ranch will be launched in Phoenix’s West Valley. It will cover 37,000 acres and contain 100,000 homes, 300,000 residents, and 55 million square feet used for commercial development.
Howard Hughes acquired the Douglas Ranch from JDM Partners led by Jeffrey Colangelo, David Eaton, Mel Shultz, and El Dorado Holdings led by Mike Ingram. Both developers will be joint venture partners with Howard Hughes Corporation on Trillium, the first village of Douglas Ranch.
Douglas Ranch will focus on sustainable development and technological advancement to help support the growth that is happening in Phoenix.
The West Valley area showed growth in the construction of new homes at over 8% and had 57% of all housing demand in the city. The area is predicted to have exponential growth as the migration of residents and businesses is expected to continue over a long period.
"The West Valley area showed growth in the construction of new homes at over 8% and had 57% of all housing demand in the city."
Phoenix Comes out on Top for Metro-to-Metro Population Growth
According to AZ Big Media, Phoenix is in the lead for metro-to-metro population growth. Other cities include Dallas, Austin, and Las Vegas.
The Sunbelt Metros are in the top rank for the metro-to-metro population growth because of their opportunities to movers from other cities. It is expected that even after the pandemic, metro-to-metro migration in the area will remain popular as people will continue to seek high-end jobs and affordability.
Multimillion Dollar Sale of Acres in Estrella MPC
The companies Harvard Investments, Värde Partners, and Toll Brothers have formed a joint venture to acquire the rest of the undeveloped land in Estrella. Estrella is a master-planned community (MPC) in Goodyear, Ariz. They will get 18,000 acres from this acquisition, and this purchase is the biggest acquisition of an active MPC in Arizona’s history.
The community is located 17 miles from Phoenix and is home to 7000 families. Amenities include clubhouses, pools, and the Yacht Club of Estrella. The new owners will continue to provide a good experience for residents by maintaining amenities and facilities. The acquired assets include multifamily and commercial parcels and the Nicklaus Design course at the community’s golf club.
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