Phoenix is a Hotbed for Tech Companies - Now Seen as Silicon Desert

August 23, 2022

Phoenix, Arizona is growing quickly, but tech companies are now swarming here. The city is becoming known as the new Silicon Valley - i.e., the "Silicon Desert".

Here are some of the projects and moves that global tech companies have announced recently:

  • LG Energy Solution is building its new $1.39 billion battery gigafactory in Queen Creek. This first-of-its-kind facility will be used to make cylindrical-type batteries that are ideal for electric vehicles. LG Energy supplies Lucid, based in Cave Creek AZ, just south of Queen Creek on the interstate highway 10. The company just paid $84 million for a 650-acre site in an auction held by the Arizona State Land Trust in the last week of April.
  • Meta Platforms (FB) started building in Aug. 2021 an $800-million data center for Facebook on a 390-acre site in Mesa, Ariz. One of its unique features is the company has partnered with the Salt River Project (SRP) to use solar power for its plant. It will use 450MW of 500MW in 3 new solar power projects from the SRP.
  • Taiwan Semiconductor (TSM) is building a massive new chip plant in north Phoenix near the 303 Interstate Loop on a 1,025-acre campus. Its move into the Phoenix area is spurring other companies to locate in the Phoenix and also other major housing developments.
  • Intel Corp (INTC) has decided to expand its chip production campus in Phoenix with two new chip factories that will cost up to $20 billion. The new plants are the beginning of Intel's new foundry line of business where it will manufacture chips for other semiconductor companies. Construction started in Sept. 2021 and will be completed by 2024.
  • 2 Semiconductor suppliers to TSMC are building plants in Casa Grande, AZ. Chan Chung, a Taiwanese company, bought 80 acres and plans to build a $400 million facility on its property, which will total 540,000 square feet. LCY Electronics Materials, also from Taiwan, bought 34 acres and plans to build an 80,000-square-foot facility. Another TSMC company, the Kanto Corp also plans to build a plant in the Phoenix area as well.
  • Apple (AAPL), Google (GOOG), and RagingWire have built or acquired large data centers recently in Mesa.
Photo by Meritt Thomas on Unsplash

In addition, a number of large tech companies have moved completely from Silicon Valley to the Phoenix area. This list includes NortonLifeLock (formerly known as Symantec) Moov Technologies and Align Technologies.

As a result, large real estate companies are coming to Arizona and buying up land parcels around the areas that tech companies locating in Phoenix. Recently a Nevada-based company called IndiCap, in a JV with AECOM-Canyon Partners bought 113 acres of land near Phoenix-Mesa Gateway Airport for $48 million. It plans to build 10 buildings with over 1.6 million square feet of industrial buildings.

Numerous tech companies are setting up operations in Phoenix, mainly as they see the area as better than Silicon Valley with a large employee base with good universities.