Six reasons businesses are moving their commercial footprint to Arizona

This article was originally published in the Phoenix Business Journal

As any business leader with an office or commercial footprint knows, there are many business expenses that are largely dependent on your location, its regulations and governmental policies. These numbers can drastically impact your operating costs, revenue and, in turn, what you need to charge for your products or services to break even or be profitable. In today’s world of high competition and e-commerce, it’s more important than ever to keep consumer prices low in order to compete with products from less expensive markets.

We are seeing significant business migration away from states like New York or California — states which prove to be both expensive and difficult for businesses to operate in. That begs the question: If businesses are choosing to move their commercial footprints, where are they moving to?

Arizona is fortunate to have become the destination of choice for many businesses. As a commercial real estate advisor and the founder of a homegrown Arizona business, I can attest to Arizona’s business-friendly ecosystem as the ideal location. Here are a few reasons why you should consider relocating your business.

1. A vast talent pool

The talent pool in Arizona is growing faster than any other U.S. metro market, with an average net?population gain of over?42,000?people ?per year.?Arizona’s population ?is currently 7.2 million people and is projected to grow to 8.2 million by 2030.

Not only is Arizona’s population growing swiftly, but the talent pool is also well educated as Maricopa County alone is home to 10 colleges, educating more than?200,000 students ?each year.

2. Affordability

When it comes to attracting top talent, the cost of living is vital when considering employee wages. According to the CEO of the Greater Phoenix Economic Council (GPEC), businesses moving from California to Arizona can expect a roughly?30% cost advantage . Moreover, the?cost of living is significantly lower ?in Arizona than in California. This allows employers more flexibility with regard to wages, enabling them to employ more people with additional savings.

3. It’s well-connected

For industrial users and office users alike, convenience is key.?GPEC reports ?that 35 million consumers can be reached by truck haul within one day, and Phoenix Sky Harbor International Airport provides access to 129 domestic and international locations through more than 1,200 daily flights. That gives companies the ability to increase their delivery capacity and travel to meet their clients’ needs.

4. Commercial real estate prices

As experts in the commercial real estate field, my team and I are able to pull data for markets nationally in order to give clients a well-rounded picture of the advantages and disadvantages of each market. Compared to markets like?Los Angeles ?or?San Francisco , with an average Class A office price of $42.41/SF and $59.21/SF, respectively,?Phoenix’s asking rate ?for similar Class A?office space is $30.79/SF, on average. That’s a significant reduction of fixed costs for businesses, giving business leaders the opportunity to invest that money back into their business.

5. Incentives

Arizona has historically been known as a business-friendly state. Not only does the state offer incentives like aggressive tax credits and increased access to capital as a benefit to moving to Arizona, but the work-from-home movement has opened more opportunities for tenants looking to stay in an office environment or even expand. Tenants now wield strong commercial real estate negotiating leverage to secure incentives and concessions that were previously unheard of.

6. Weather predictability

With an average of?300 days of sunshine ?per year, Phoenix is one of the few places that does not get hit by natural disasters or unpredictable, business-halting weather. Sure, there is the occasional?monsoon thunderstorm , which typically lasts about 30-45 minutes, but when it comes to winter weather, the last thing you can expect is a white Christmas. This predictability makes it easier for business leaders to plan without the worry of accounting for costly, weather-related delays.

With over?800 companies ?relocating or expanding to Arizona in the past 30 years, it’s no shock that Arizona continues to be one of the leading states in migration trends. Arizona is waiting for you and your business — can you imagine moving your commercial footprint to “The Valley”?