PHOENIX-Investors, largely from out of state, continue to find the industrial market encompassing Arizona’s largest city an attractive place to deposit their money. According to Real Capital Analytics in New York City, the Phoenix metropolitan area saw $870.8 million of industrial investment from November through April, far out-pacing such powerhouse markets as Dallas, Houston and Atlanta and only $70 million short of matching Chicago, the nation’s largest market.

Analysts point to two primary sources for interest in the market. First, the Census Bureau’s most recent figures rank Phoenix as the third fastest growing major metropolitan area in the country, adding more than 130,000 people in the last 12 months. Second, proximity to Southern California makes the region an attractive alternative to the coastal state’s increasingly congested and expensive markets.

Jay Ellingson, executive vice president of SunCor Development Co., calls Southern California proximity the major impetus for the Tempe, AZ company’s development of Palm Valley 303, a 1,600-acre, 19.6 million-sf business park in the Phoenix suburb of Goodyear. The project launched in April with the construction start of a 440,000-sf, speculative cross-dock distribution facility. “Tenants will be able to bring containers direct from the ports of Long Beach and Los Angeles for break-down, assembly and distribution,” he explains. “Even though there are added transportation costs, rents are significantly lower than the Inland Empire.”

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