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Valley warehouses becoming 'inland port' for California, Southwest
There was a time in the Valley when even the whisper that Walmart Inc. was looking for a new store location would set off a dogfight among cities that make up the Phoenix metro.
Today, as more warehouses, distribution centers and manufacturing companies locate to the region, particularly in the West Valley, cities aren’t fighting as much as working together to land bigger targets, realizing everyone will reap the rewards.
“All the communities benefit,” said Harry Paxton economic development project manager for the city of Goodyear. “You want to develop your retail sector as much as possible in your community, so your citizens stay in your community and shop. But we all know that we all shop in different communities depending on what we’re looking for, and something is better than 0 percent.”
The completion of Loop 303 in the West Valley is helping on the shopping front, but it’s also helping the Valley become a central location for numerous companies’ shipping efforts with a multitude of distributions centers cropping up along the route in addition to existing facilities in Phoenix, Tolleson and Avondale.
Benefiting from big boxes
During the past five years, as the Valley struggled to get out from under the Great Recession, Paxton said Goodyear had four distribution warehouses, compared to eight today. The big names, most of which are internet fulfillment centers, include Amazon.com, outdoor outfitter REI, Macy's and Chewy.com, the pet food and care retailer owned by Phoenix-based PetSmart Inc. that expects to have its center up and running later this year.
But Goodyear also scored some major manufacturers, said Paxton, pointing to Ball Corp. in particular. The Colorado-based company manufactures plastic and metal food and beverage containers around the world, as well as making equipment and providing supplier services to the aerospace industry. The company announced in September it would build a new beverage packaging plant in Goodyear.
“Today we have Ball Corp. that’s constructing on half-million square feet,” he said. “That’s certainly a great manufacturer we’ve got in our community, and their largest initial investment in our community is $240 million, so that’s a tremendous investment.”
Avondale, Goodyear’s neighbor to the east, is happy with its changing fortunes as a result of the influx of warehouses, distribution and manufacturing. Jeff Fairman, Avondale’s economic development director, said the city has landed industrial manufacturer Copper State Rubber as well as the 1 million-square-foot Coldwater Springs Depot.
“These new facilities have significantly impacted all segments of Avondale’s economy,” he said. “One of our primary goals in economic development is to bring quality employers and jobs to the area, and well over 1,500 new jobs have been filled through these locates.”
Making the right pitch
Helping cities across the Valley pitch for new companies is the Greater Phoenix Economic Council and the Arizona Commerce Authority. GPEC reports that between July 2015 and January 2018, the organization assisted in bringing 31 companies to various West Valley cities and West Phoenix.
Among the major companies are SK Food Group in Tolleson with 550 jobs, Stitch Fix in Phoenix with 600 jobs, and Amazon in Goodyear with 500 jobs. When it is ready to open, the Chewy.com facility in Goodyear is expected to bring 700 jobs.
Fairman said “relationships with local, regional and national commercial real estate brokers, and our own outreach efforts with organizations and site selectors,” have worked to create a niche for the region as a potential distribution center for the Western U.S.
While higher taxes, rising land prices and growing regulations have many California companies looking to relocate, it’s the West Valley’s access to a quality workforce that can seal the deal, both Paxton and Fairman said.
“We know we have a strong workforce here, it continues to be proven to us every time a company comes,” Paxton said. “Ball Corp. is building a technical facility with a lot of automation. Their equipment is five or six times the cost of the building. They need technical people and, in their words not mine, they ramped up to about 90 people already because they are amazed with the qualitative workforce and in the quantity of the workforce and so they’re very happy. We continue to say to employers as they locate here that there’s an ample supply of a quality workforce here in the West Valley.”
Source: Phoenix Business Journal, March 2018