Data center activity aids industrial land sales in Phoenix
Industrial land sales have been fewer over the last ten years due to their relegation towards industrial zoning areas and larger median acreage
June 19, 2019
- Compared to both residential and commercial (office) land sales, industrial land sales have been fewer over the last ten years due to their relegation towards industrial zoning areas and larger median acreage, however, activity has increased significantly with the help of recent data center activity. Collectively, 2018 and 2019 have accounted for 26.5 percent of all industrial sales in the last ten years.
- The halfway point of 2019 has brought a unique situation, with residential land sales eclipsing commercial (office) sales by only 4.7 percent, and industrial sales by 46 percent. Historically, multifamily sales outpace office sales by two-fold, and industrial sales by five/six-fold.
- Large users such as Microsoft, taking over 400 acres in the last twelve months, Stream Realty Partners, and Cyrus One are migrating to the Southwest Valley and East Mesa to take advantage of prime land with easy access to large power easements and fiber connectivity. In addition to that, favorable power rates can be found through SRP and APS at an average of $0.064 per kilowatt hour, a $0.03 decline since 2014.
Source: JLL Research