$500 Million Plant bringing 3,000 jobs to West Valley in Phoenix

[Melanie Johnston]

More Good News for Property Owners/Investors in the West Valley! (West of Phoenix)

This the latest in a slate of good economic news for the cities west of Phoenix, collectively called the West Valley.

Highlights of the Phoenix Business Journal article, written by reporter Corina Vanek:

After a search that lasted more than two years and included over 300 sites in 20 different states, KORE Power Inc. will build its manufacturing facility in Buckeye, where it expects to employ about 3,000 people.

Coeur d’Alene, Idaho-based KORE had narrowed its selection to sites in Arizona, Florida and Texas before deciding on the Grand Canyon State a few weeks ago, Lindsay Gorrill, CEO of the company, said. The plant is expected to total 1 million square feet.

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Gorrill said the site that the company has chosen, at MC 85 and Interstate 10, is perfect because it has easy access to the interstate and there will be an APS substation nearby. The site will also have a solar power setup where the building will store its own energy.

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The company produces battery cells, which can then be put into a variety of different forms, including for use in electric vehicles including trucks, boats and drones, and can also be used for energy storage, including for solar and wind power that needs to be stored and used at a later time.

Arizona is a growing hub for the production of electric vehicles and its batteries. Lucid Motors, Nikola Corp., ElectraMeccanica and Local Motors all chose to build their EVs in the state. Battery recycler Li-Cycle is building a facility in Gilbert and EV parts producer UACJ Whitehall is setting up shop in Flagstaff.

...The Buckeye plant, which has been named the KOREPlex, is expected to produce 12 gigawatt hours annually, which Gorrill said is enough to power more than three million homes.

Developing the first phase of the Buckeye plant is expected to cost about $500 million. There is room on the site to grow capacity beyond the first phase, but expansions will be dictated by market need, he said. At full buildout, the company is expecting the total project cost to be just under $1 billion. Construction is expected to begin on the site by the end of the year, with the goal of beginning production in the second quarter of 2023.

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About two-thirds of the jobs at the plant will be manufacturing, he said. Other jobs include engineers and warehousing and distribution positions. Hiring has already begun for some of those jobs.

“KORE Power’s investment in Buckeye to produce clean, renewable energy aligns with the city council’s sustainability goals and our goal for significant employment opportunities for our residents,” Buckeye Mayor Eric Orsborn said in a statement. “This project is not just a win for Buckeye, but for the West Valley, the state of Arizona and the clean energy industry.”

(From Melanie) This is a big win for landlords in the West Valley. I just helped a BiggerPockets investor close on 3 homes in that area and he feels announcements like this "de-risk" his investments, as he says.

This is just one of many announcements about companies moving to or expanding in the Valley (which is what we call the Phoenix Metro area...but you know this if you watched the Suns get ever-so-close in the NBA Finals).

CoStar.com just reported this on the Metro Phoenix market:

Job growth is expected to continue at a healthy pace based on the number of [office and industrial] tenants looking to relocate and expand and who are actively searching for space in the market. Prospects looking to locate in Phoenix during the 2021 fiscal year were up 115% from the previous year, according to the Greater Phoenix Economic Council, a regional economic development organization.

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The organization assisted in the relocation of 45 companies to Phoenix during fiscal year 2021. The companies account for some of the largest planned build-to-suits, leases and occupancies over the past year. On the industrial side, that includes TSMC (3.8 million square feet and 1,900 jobs), The RealReal (593,600 square feet and 761 estimated jobs), HelloFresh (438,690 square feet and 750 estimated jobs), MLILY (643,800 square feet and 424 estimated jobs) and KeHE (470,000 square feet and 200 estimated jobs). Some of the largest office deals were PennyMac (74,625 square feet and 374 estimated jobs) and Robinhood (34,000 square feet and 182 estimated jobs).

The best news in all of this is the economic diversity it has embedded in our economy.

Keeping you in the know,

Melanie