CORPORATION, POPULATION, & SMALL BUSINESS GROWTH IN PHOENIX
The weather isn’t the only thing that’s hot in Phoenix. It’s a phenomenal location when it comes to everything from job growth to population growth. These elements have helped the city become a top real estate market to consider looking at, especially for investors.
In addition, the rent growth itself has been on a steady increase, and there’s no stopping Phoenix or the surrounding area with the multiple locations of development we have seen recently.
The Phoenix MSA continues to see new companies come in and build up their businesses, which in essence leads to more people coming in to live and work here. This of course leads to the new demand for places to live and amenities for those times when people aren’t working.
Usually, just a few of these would be a good showcase for an area of great investment potential. Still, the Phoenix Metro is working on covering all the different positives one looks for in real estate investments and working hard to mitigate that risk and work to eliminate it.
In addition, its economy has already recovered and is heading in a definite upward trend. This is pushing all markets to all-time highs with nothing to stop it over the horizon.
Exponential Business Growth
Numerous companies are building locations here or expanding their business infrastructure. This is an expected trend resulting from the enormous growth seen recently.
There is also extensive construction continuously happening to raise the amount of commercial real estate that is available for businesses. Carvana, which was founded in Arizona, has recently expanded its footprint to nearly 270,000 square feet. The infrastructure was rented from the University of Phoenix Riverpoint Campus, and expansion is due to the eCommerce site’s growth.
Phoenix is also becoming a massive market for the manufacturing industry, and it just recently completed a 60 million dollar project in Mesa. The Gateway Commerce Center II, is all about attracting everything from massive warehousing to industrial manufacturing. It also comes easily connected with the Gateway Airport, increasing the opportunity for logistics and transportation.
In Glendale, Nestle has opened up a manufacturing and distribution center that will open up an additional 350 jobs in the area, at a minimum. In addition, Nestle’s plant itself is an investment in sustainability as it will have numerous features to reduce its environmental impact.
For example, the plant will be using less water in its manufacturing and using only fully recyclable plastics in all its packaging from that plant itself.
Williams Sonoma decided to expand to the manufacturing hub that is becoming of Arizona. The furniture manufacturer is setting up a location with a distribution and fulfillment center that is 125 million square feet. As the largest digital-first furniture provider, it only seemed the right place to set up in the Phoenix area.
The local government, especially around the Phoenix area, is making itself out to become this global and manufacturing powerhouse for the Western Coast of the United States and the whole country.
But it doesn’t stop there with manufacturing as it expands into other commercial sectors. The large scale sees this by the Menlo Group of the Lake Biltmore Corporate Center. This is an excellent location for a large company to utilize as its headquarters or an area for multiple companies to be added to the thriving business districts growing here.
Small Business Growth
Arizona itself has ranked 2nd in small business growth in February of 2022. However, the small business index has improved by nearly 8%, and hourly wages have increased consecutively for the past nine months. Phoenix ranked fourth for growth when comparing metros across the United States.
This helps to round out the different sectors, from manufacturing to corporate office roles to small business roles, all trending with large growth patterns and much more construction occurring on the horizon that is helping to keep this growth sustainable.
This is also one of the significant reasons that relocation to this city and the surrounding area has been so popular. In many other cities with rapid growth, it’s usually due to just one large company moving to the site and becoming a primary supplier of jobs in the area.
In the Phoenix MSA, the growth of jobs is so varied and diverse; it displays a whole separate layer of security through diversification of job classifications, industries, and types. So it’s more akin to more extensive metropolis settings with this massive mix of varied roles, from retail to production.
Influx of People
As can be imagined, where the jobs are growing, so is the population. This isn’t also people moving from smaller suburbs or towns into the Phoenix metro area, but it is a global reach for those migrating into Phoenix.
Over the past five years, Arizona has welcomed its diverse new population from major cities such as Los Angeles and New York to people hailing from numerous countries in Asia, Central America, and Europe.
As a result, Arizona seems as if it’s going to top the nation in population growth again, depending on the final information of the interim census to be released in the near future.
This is all due to this being a region of opportunity for many with various skill sets, from manufacturing to entrepreneurship to corporate office life. In addition, as the pandemic ends, the leisure and hospitality industry is picking up speed again, requiring the additional population to handle the necessary staffing.
The diversification will also see a positive benefit throughout the area with an increased variety of shops and dining, reflective of the newfound population. This adds to the extensive pre-existing list of amenities that the Phoenix metro area already provided.
With the numerous job opportunities and companies moving into the area and the combined influx of new people migrating into the area, one might wonder if Arizona is a good place to raise a family?
You may be happy to learn the answer is an undoubted ‘YES,’ with Queen Creek named the most ideal city to raise a family in the west. Vail, Chandler, and Catalina Foothills, Arizona ranked #2, #3, and #4 respectively for this report by Dwellics.
Part of the criteria used was how few natural disasters there are in the area and the high population of educational workers in the area. In addition, there’s a vast population in the medical field, with numerous hospitals and clinics in the surrounding area. A factor that often rates highly when determining a new living location.
There’s plenty of residential development in the Phoenix metro area to support this increase. In addition, the weather allows numerous public parks and pools to cool off from the Arizona heat.
But, of course, that is already on top of a growing excellent school system from preschools to higher education. And with the heavy job opportunities, there’s always room for family growth and expansion.
Growth Continues with Huge Land Acquisitions.
This isn’t the end by a long while, and even areas that were considered already well developed seem to have continued development and expansion. Recently, Scottsdale sold a vast 124-acre plot for additional development.
This $125 million land deal is also as diverse as the population coming into the area. It’ll be used for Industrial, commercial, and residential improvements, expanding holistically for the city of Scottsdale.
Other land in the area is already in progress or will soon follow suit as Phoenix continues its unprecedented rapid expansion. This is to keep up with the constant growing demand that is outpacing the existing supply throughout the area.
A Prime Opportunity
We have seen some incredible growth in the Phoenix metro area. With this rapid improvement also comes some investment opportunities for those who are looking to diversify or expand their existing investment pool.
The continued growth is not looking to slow down in Phoenix, with rent growth at 22.5%, those looking to get into the real estate market should consider Phoenix.
The primary relocation to Phoenix used to be either a relocation due to work or to begin an amenities-rich retirement. That has since expanded since the job opportunities are more varied beyond hospitality and corporate offices.
In addition, with manufacturing taking such a massive investment into the area and the government’s continuous expansion of the infrastructure, we are bound to see more manufacturing distribution, fulfillment, and industrial companies start to look at Phoenix as their second home.
The Phoenix metro area is also one of the few cities that has fully recovered in the job market area, already reaching pre-pandemic employment levels and starting to look as if they’re going to surpass those figures.
The market is strong and healthy in an area that has diversified itself from what it was once perceived as. This renaissance and reinvention of how people see Phoenix will help make it one of the most important regional and national hubs for commerce and livelihood.