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Market Report

Phoenix Industrial Market Report

2Q 2021

Firms Prioritize Cost-Friendly Areas for Larger Facilities;
Barrage of Speculative Projects Incoming

Industrial growth is driven by new population and regional demand. Phoenix’s location and abundant space make it enticing for industrial developers and investors. The metro’s population rate grew at 2.0 percent over the past 12 months, well above the national rate. As new employers move here, the need for flex space and warehousing for logistics will continue to accelerate. Phoenix’s proximity to the West Coast makes it a cost-effective location of choice for short-term import warehousing compared with the Inland Empire. Development is centralized toward the western part of the Valley, with clusters of construction in Tolleson and Litchfield Park. Chandler and Gilbert are locations of interest for developers as well, as Phoenix-Mesa Gateway Airport is developing an international customs agreement with Mexico for seamless cargo transport across the border. Sky Harbor, Phoenix’s main international airport, is home to a FedEx Hub, UPS operations and Amazon Air. The abundance of industrial skilled manufacturing in the area has attracted companies like L3Harris, Boeing, Teradyne and others to make Phoenix their skilled manufacturing home.
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