You see all of the data and it’s clear that the Arizona economy is getting a boost from California, as companies big and small are exiting the Golden State for the better business environment in the Grand Canyon State.
Since 2015, 49 California companies have chosen to set up shop in Arizona, a remarkable number. Well, recently, that number jumped to 50, as H.E.R.O.S. Inc., an industry leader in repairing and overhauling helicopter engines, announced it was moving its headquarters from Santa Clarita, Calif. to Chandler. The company will occupy nearly 19,000-square-feet of industrial space at 10 Chandler, located at 560 N. 54th St. H.E.R.O.S. Inc. plans to create 25 new jobs in the Chandler community and expects to be fully operational by the winter of 2019.
“We were drawn by the business-friendly environment and the lower taxes in all areas of our business and our employees’ lives,” said Raffi Kajberouni, vice president at H.E.R.O.S., Inc. “There’s just a lower cost of living for our employees, and they can afford places to live near where they work and this move allows us to expand our capabilities.”
In a report released from the U.S. Bureau of Labor Statistics, the Phoenix-Mesa-Scottsdale metropolitan statistical area (MSA) had the largest total nonfarm job growth of all large MSAs from May 2018 to May 2019.
The Phoenix metro area added 66,500 total nonfarm jobs year-over-year, representing 3.2 percent job growth — the largest of any MSA with a population over 1 million in the 2010 Census. Leading sectors for employment growth were Education and Health Services (17,200 jobs), Construction (15,100 jobs) and Professional and Business Services (12,800 jobs).
What impressed Kajberouni the most about the atmosphere in Arizona was the fact that the company originally looked to relocate in Gilbert. H.E.R.O.S. worked with town officials and the Greater Phoenix Economic Council (GPEC) on finding a suitable location, but struck out. Gilbert officials helped guide H.E.R.O.S in their search toward Chandler, where H.E.R.O.S. found the space they were looking for.
“It was fantastic. It was night and day. GPEC has been incredible and helped us throughout the way. And working with Gilbert, we were unable to find a building, but without their assistance, we wouldn’t have been able to find a building,” Kajberouni said. “Working with them was fantastic. You felt the difference. You felt that these people want us here.
“And once we committed there, the real commitment started from Chandler and everyone else. They told us, ‘When you’re up and running call us back, we want to stay in touch.’ “
H.E.R.O.S. is looking at starting operations in Chandler on Dec. 1 and will open with 31 employees, with hopes of expanding.
This economic “Win” for Arizona was just one of many the state has seen in the past year. The following information provided by AAED is just a sample of other economic developments in the state:
• Voya Financial announced it will open a new office in the metro Phoenix area and bring more than 1,000 jobs to the Phoenix area. The new location will be in addition to Voya’s existing Scottsdale office at 7337 E. Doubletree Ranch Rd., where approximately 200 employees from the company’s Investment Management business are already based.
• Hopebridge announced plans to establish pediatric autism therapy centers to 12 locations in Arizona, the first three of which are in Phoenix, Glendale and South Tucson.
• CarMax, the nation’s largest retailer of used cars, will create 430 new jobs for their new Customer Experience Center which is opening in Tempe in December.
• Verdigris Holdings, Inc., selected Arizona for its corporate headquarters. Verdigris will bring over 210 well-compensated jobs to the Greater Phoenix area with average annual salaries of over $150,000. This represents an economic infusion of over $32 million per year by 2022 along with a $19 million capital investment. Verdigris uses the combination of cutting-edge technology, industry expertise and ultimately a real, regulated bank to deliver simple transactional banking to unbanked people and the companies that serve them.
• thredUP, the world’s largest online marketplace to buy and sell secondhand women’s and children’s clothing, opened a new distribution and office in Phoenix. The 120,000-square-foot space is expected to bring 500 new jobs to the market.
• Choice Hotels recently announced it will be locating its technology headquarters to Nationwide Realty Investor’s Cavasson development in north Scottsdale. Choice Hotels expects to hire 500 people over the next five years. It is the second tenant at Cavasson, joining Nationwide Insurance, which is expected to move into its new, 460,000-square-foot regional headquarters building in late 2020.
• Able Aerospace expanded its Mesa headquarters by 60,000 square feet. With more than 450 employees Able is already the largest current employer in the Phoenix-Mesa Gateway Airport submarket. The $9 million expansion will create room for 100 new jobs, bringing Able’s total employee count to more than 550.
• Fujifilm Electronic Materials U.S.A., Inc. is currently working on an 85,000 SF building expansion at its Mesa facility. The five new buildings will expand the company’s capabilities for manufacturing, warehousing, research and development and office space. The expansion, which is expected to be complete in early 2020, will mean 60 new jobs will be coming to the facility.
• AT&T created 500 jobs at a new, state-of-the-art customer call center unveiled in July of 2019. The 97,000-square-foot call center is located within AT&T’s corporate campus and brings the total number of AT&T employees in Arizona to 1,700.
• Times Microwave Systems (TMS) expanded its Mesa manufacturing facility located at Metro East Valley Commerce Park. The new facility is more than five times larger in size. Since Times Microwave began Mesa operations in 2015, it has grown from two employees to more than 80. With the move to its new facility, the company expects growth to continue.
• Commercial Metals Co. completed construction and commissioning of a 63,000-square-foot expansion and manufacturing line to produce spooled rebar at CMC Steel Arizona, a micro mill in southeast Mesa. The Mesa operation has grown since it opened in 2009, investing more than $75 million capital in the campus and growing its workforce. The company originally anticipated a workforce of up to 200. CMC Steel Arizona now employs more than 260 directly on site.
• Waymo announced in March that it will be opening a new, 85,000-square-foot service center in Mesa. The new center will more than double the company’s service and maintenance space in the Valley and the company said that this location will create 100 new jobs, with the potential for more in the future.
• Myndshft, a technology company that specializes in blockchain and artificial intelligence in healthcare, moved into a larger office in the Red Mountain Business Park and plans to triple its team from 30 to over 100 employees in 2019.
• CAVU Aerospace is moving forward with construction on an 80,000-square-foot aircraft maintenance facility at the Phoenix-Mesa Gateway Airport. The $5 million project is expected to create 75 jobs over the next three years.
• Google has committed to a $1 billion, 750,000-square-foot data center campus project to be built in three phases at their location on the northeast corner of Elliot and Sossaman.
• RagingWire closed on a land purchase on July 1 for their first data center location in Arizona.
• Nike purchased the 2018 RED Award-winning Lincoln Logistics 40 for $70 million in August and announced plans to invest $185 million to turn the facility into a manufacturing plant for the mid-sole cushioning for its athletic shoes. The 901,700-square-foot facility will employ more than 500 full-time employees.
• Fairlife, LLC, a dairy production and distribution company, announced plans to increase overall production capabilities with the construction of a new 300.000-square-foot production and distribution facility in Goodyear. The new $200+ million facility, which is slated to begin operation in the back half of 2020. Located at the corners of Cotton Lane and Thomas Road at the Palm Valley 303 Business Park, the new facility will incorporate advanced manufacturing technologies and efficient, energy-saving equipment to reduce power consumption. It will create more than 140 jobs locally.
• Civic Square at Estrella Falls was approved by the Goodyear City Council in August. This first-of-its-kind project is in partnership with the Globe Corporation. The development will serve as a gathering spot for civic events, festivals, concerts and more. It will have civic buildings, as well as a 100,000-square-foot, Class A speculative office space as part of phase 1.
• Two hotels are under construction at Bullard Ave and Interstate 10 to address growing need for hotels in the West Valley. Innovative Hilton concept TRU provides a modern, lively vibe targeting millennials and young adults. This hotel is four stories, 54,561 SF with 90 rooms. The second hotel is a Springhill Suites by Marriott. This product provides upscale business and family accommodations, all-suite hotel with more amenities. The project is four stories, 40,713 SF and has 88 rooms.
• PMB invested $15 million to transform the former Palm Valley Cinema multiplex theater into the 50,000 SF Palm Valley Medical Center, a medical office product that was 90 percent preleased at opening.
• Adelante Healthcare Goodyear was built in 2019 by LGE Design Build. The nearly $5 million project is a nearly 45,000-square-foot comprehensive primary health care center. The seven-acre site and medical office building will serve several hundred patients per day in a one-stop shop environment of care. LGE completed both the new single-story shell building and the interior tenant improvements in parallel to complete this innovative and unique medical center on the campus of Abrazo West Hospital. The facility resulted in 40 jobs.
• Northwest Healthcare announced expansion in Tucson, creating nearly 600 jobs.
• Amazon, the global e-commerce leader, will open a new auxiliary distribution site that will receive and sort packages from larger warehouses to be transferred onto vans and smaller delivery vehicles. The company plans to create 300 jobs, which will primarily be delivery drivers and warehouse employees. The economic impact of the new Tucson “last mile” delivery center will be $181 million over the next five years.
• Imperfect Produce, an on-line produce delivery company focused on fighting food waste by finding a home for ‘ugly produce’, will open its first customer care center in Tucson. The company plans to create 350 jobs at all levels, including customer care associates, supervisors, and managers. Also, Imperfect plans to make a capital investment of $200,000, creating an economic impact of $137 million over the next five years.
• Southern New Hampshire University, a non-profit, regionally accredited university with a more than 80-year history of providing high quality education to students online and on campus, will open a new operations center in Tucson to better support its growing student body across the country. The new center will house 350 employees, including additional student-support staff, including academic advisors, student financial services staff, admissions, and IT support. The economic impact of the new Tucson SNHU Operations Center will be $218 million over the next five years.
• Symboticware Inc., an industry leader that provides an industrial IoT hardware and software platform to help customers unlock, collect and analyze valuable data to help improve business outcomes in the mining industry, is establishing a US/Mexico headquarters in Tucson. Symboticware will add 20 new high-tech jobs and invest $500,000 in their Tucson headquarters. The project is expected to create an economic impact of more than $17 million over the next five years.
• MicroMex, a privately owned company based in Mexico that provides contract manufacturing to a wide range of industries, is opening a new manufacturing and distribution center at the Port of Tucson. The company plans to create 100 new jobs, which will primarily be assembly and warehouse workers. The economic impact of the new Tucson distribution center is anticipated to be $181 million over the next five years.
• Dove Mountain Residences, LLC announced plans to build a state-of-the-art senior living facility in Marana, creating nearly 70 jobs.
• Geico opened a new, 200,000-square-foot regional office in Tucson and will consolidate its 1,500 regional employees into the building and add an additional 700 positions in the next few years.
• Rehabilitation Hospital of Northern Arizona (RHNA) held their grand opening in Flagstaff in 2018. RHNA provides specialized rehabilitative services including Occupational Therapy, Physical Therapy and Speech Therapy to patients who are recovering from disabilities caused by injuries, illnesses and chronic medical conditions. RHNA provided 150 new high wage jobs to our community.
• Welbrook Senior Living held a soft opening at the end of last year. They have brought over 125 new jobs that offer quality care that includes assisted living, memory care, skilled nursing and rehabilitation. They are elevating healthcare through hospitality, compassionate care, and dignity with exceptional service.
• Flagstaff Urgent Care opened another location in Flagstaff. The new Sacred Peaks Clinic in Flagstaff is now open. Loven Construction provided preconstruction and construction services. This 24,000 SF facility is the first entirely new building for the Navajo Hopi Foundation and represents a significant step in the ability to offer state-of-the-art care in a culturally sensitive setting.
The largest company expansion came late in 2018, when Almark Foods completed a new 115,000-square-foot plant that produces peeled, hard-boiled eggs. The new facility created 117 new jobs for the company. Another company, Insultech, expanded its Yuma operations and added 45 new employees. Insultech produces thermal insulation products. Other companies in the Yuma market that expanded are LaSalle Southwest Corrections, which added 13 employees; and Martech Medical, which added four employees.
New companies in the Yuma area in the past year are Piana Group, a high-performance textiles company; LRC Coil, which produces custom coils and evaporator units, and MPW, which opened a 30,000-square-foot industrial water regeneration plant.