Slow to recover from the recession, Tucson is finding strength in technology-based companies.
The economy in Tucson, Arizona has been on the ropes since the Great Recession and is still a bit behind the rest of the nation in its recovery.
But we at Commercial Real Estate Group of Tucson see some bright spots among the surveys and polls about our standing among cities nationwide. We study these because we want to be able to knowledgably respond to commercial real estate site selectors as they consider Tucson for office space, industrial space or retail space.
Recently we’ve been looking at the numbers from the Milken Institute’s “Best-Performing Cities” report for 2015, which came out in December. It measures how well U.S. metropolitan areas are doing in creating and keeping jobs and growing economies.
Tucson sank to an abysmal 175th in the rankings of 200 large cities and metropolitan areas, dropping 14 positions compared to the 2014 report. Rankings on past performances in job and wage growth fell dramatically.
TUCSON’S HIGH-TECH HUB
But when it comes to the high-tech industry, Tucson shines. Its 19th ranking for the number of concentrated high-tech industries is higher than competing cities of Albuquerque, New Mexico; Las Vegas, Nevada, and Phoenix, Arizona. It’s only slightly behind Austin, Texas and Salt Lake City, Utah. San Diego, California, ranks #1 for all large cities.
Tucson has a higher concentration of high-tech industries overall than Las Vegas and about the same as Phoenix and Salt Lake City.
What does this all mean? High-tech companies grow and thrive best in an environment where colleagues, suppliers, researchers and a ready workforce are nearby to easily share ideas and reduce costs.
These synergetic relationships are found in abundance in Tucson, particularly in the high-tech hubs of biotech, aerospace, defense, sustainability and mining. The University of Arizona, professional and industry associations, government agencies and investment groups provide the support and infrastructure that attract worldwide attention among commercial property site selectors.
Raytheon Missile Systems, Ventana Medical Systems, the Bio5 Institute, Davis-Monthan Air Force Base and suppliers to Freeport-MacMoRan are just some of the major players in their respective industries.
And the horizon looks bright for Tucson. State and local initiatives aim to attract more high-tech research, development and manufacturing companies to the area.
People are noticing the turn-around. The Milken Institute report shows a steady improvement in high-tech sector output growth compared to the U.S. average.
Moody’s projects 11 percent job growth over the next five years. Its report says businesses will find a low-cost alternative to southern California and a highly educated workforce from the local University of Arizona and Arizona State University not so far away.
Money magazine calls Tucson one of the Top 5 cities for millennials because of its relatively low cost of urban living, a young population and growing job opportunities. We feel our time has been long in coming, but we’re encouraged that the Tucson economy has made that turn up.
Commercial Real Estate Group of Tucson specializes in representing tenants and corporate users across the United States. For more information call +1-520-299-3400.