The Valley’s growth of technology businesses is behind much of what is going up: the number of renters, more apartments, the population and the cost of office space. High tech employment shot up more than 25.4 percent over 2015 and 2016; an impact that has spread across the job market. Last year the demand for jobs in the professional, scientific and technical services jumped nearly five percent.
Tempe= tech hub
Microchip and Intel have been longtime citizens of Chandler, but several other tech companies have either expanded or relocated to the Valley. Intel announced a seven-billion dollar expansion that will add three-thousand jobs. Tempe is becoming a tech hub. Versum, Benchmark, Concentrix, Bishop Fox and ZipRecruiter all have offices in Tempe. Mesa is home to Dexcom and Upgrade is headquartered in downtown Phoenix.
Best place to find a job? Hint: Look in Arizona
As the companies expand their work force, the impact is being felt across other industries. WalletHub compared more than 180 cities across the country. Researchers looked at everything from job opportunities and employment growth to monthly average starting salary. It declared that the five best cities to find a job in 2018 are here in Arizona. Chandler, Scottsdale, Peoria and Gilbert finished first, second, fourth and fifth respectively.
Gilbert X 2: Population explosion
Where jobs emerge, people follow. Gilbert, for example, has doubled its population in ten years. This influx of people is changing the real estate market. Gilbert saw the percentage of people renting their homes jump —53 percent. That’s the highest increase of any municipality in the country. Mesa, Phoenix, Scottsdale, Glendale etc. all saw increases between 20 and 30 percent in the percentage of renters vs. homeowners. The Valley is absorbing rental units almost as fast as developers can build them. This year 7,500 rental units will come online, that’s 15 percent more than in 2017.
Metro Phoenix office market is growing but…
Tech is also pumping up metro Phoenix’s office market. It saw double-digit sector growth last year and all temperature gauges point to a continued warming trend—with some caveats. Like residential renters, office tenants have become pickier about what they lease and where. Tech companies are hiring employees from a tech-savvy, millennial workforce that wants modernized, collaborative work spaces with on-site amenities and cyber-security. This is predicted to encourage a drop in speculative developments in favor of renovations. Office rents, (Surprise!) will also likely continue to climb.
Space? Yes. Hurricanes and regulations? No.
Metro Phoenix is not becoming Silicon Valley, but its business friendly regulations, non-natural disaster-prone weather and availability of space make it attractive to tech companies looking to stretch out, economically. This bodes well for both the commercial and residential real estate markets.
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