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Updated over 2 years ago, 03/13/2022
Is The Sleepy Old Pueblo Finally Waking Up?
Is The Sleepy Old Pueblo Finally Waking Up?
Is Phoenix’s little sister finally ready to come out of the shadows and into the national spot light as an emerging and thriving city? Based on the building and development happening in the Old Pueblo it sure looks like it. Now let me be clear, I am not trying to compare Tucson to the 12th largest city in the U.S., but I do believe that Tucson is finally coming into its own. There is growth and development occurring throughout the city, and no sign of things slowing down. With announcements occurring almost weekly of new corporations bringing jobs to our economy and new developments breaking ground, Tucson seems poised to finally shed its title as Phoenix’s little sister.
I have lived in Tucson for 10 years, I moved to the city to attend the University of Arizona in 2007. At that time Tucson was a mix between a college town and a place for retirees to visit in the winter months. You didn’t see cranes in the skyline or hear about new companies bringing thousands of jobs to our economy. Known for a slower pace, it was apparent that Tucson wanted to be and could be so much more. Fast-forward 10 years and Tucson is hardly recognizable. We have great restaurants, a night life Downtown, and the economy is thriving with a local government embracing the growth.
This past week a friend of mine visited Tucson for the first time in 2 years. He owns real estate in Tucson and is doing a couple new project with my team. He flew in to check out the projects and visit for a couple days. As we drove through town I found myself pointing out new projects and developments every couple of blocks. He was blown away by the growth, and to be honest, as I talked about all of the different projects occurring, I was somewhat taken aback as well. Being active in the local real estate market I had lost perspective of how far Tucson has come and how much is actually happening in our community.
To fully demonstrate this growth I decided to pull news articles of some of the major projects that are currently in process or are planned to start in the Old Pueblo. I have included a brief headline and summary below as well as links to each article for more information.
If you would like to discuss the Tucson market, strategic planning for building wealth through real estate or how our team may be able to help you accomplish your real estate goals please do not hesitate to send me a message.
“The Downtown Tucson landscape is rapidly changing. A new business opens every couple weeks and construction projects are happening around nearly every corner. Since 2008, Downtown Tucson has experienced over $1.2 billion in public and private investments, and over another half billion dollars is being invested into current and proposed projects.”
New Developments In Tucson
(Bigger Pockets Will Not Let Me Post The Article Links. Send Me A Message And I Will Send You)
Caterpillar Inc. Bringing Regional HQ to Downtown- CAT is building new regional HQ that will provide 600 engineering jobs to Tucson with a projected $600 Mil. positive economic impact on Southern Arizona. Tucson.[1]
Amazon Fulfillment Center Coming to Tucson- Although Tucson did not win the bid to become the home of Amazon’s second HQ it does look like we will be getting a very nice consolation prize. Known as “Project Wild Cat” it appears Amazon will be building a 20 acre (Yes 20 acre) fulfillment center that will bring 2,000 jobs to the Old Pueblo.[2]
Geico to Build New Corporate Office in Tucson- Geico’s regional office is staying in Tucson and they will be adding 700 new jobs. Bourn Companies will be developing a new 200,000 sqft office space for the national insurance company.[3]
New Shopping Center in Central Tucson- 10,000 SqFt retail and restaurant space coming to central Tucson. Both T-Mobile and Starbucks have already signed leases for space in this new development.[4]
New Housing Development on 4th Ave.- Proposed 250 unit seven story development is currently planned to be built in the heart of historic 4th Ave. [5]
$137 Million UofA Honors College Complex-Described by UofA as being a "campus within a campus."Located just north of the business and law school this project will have over 1,000 beds for first year honor college students.[6]
Student Housing Project on Broadway- The Mark at Tucson is a 8 story 154 unit high end luxury apartment complex set to be completed in fall of 2019.[7]
Another Student Housing Project Coming Soon- With a land acquisition cost of $10.2 Mil. this new luxury student housing complex is located on the parking lot next to Chase Bank at UofA. This tower will house 505 students and have units ranging from studios to six bedrooms.[8]
AC Marriott Hotel Open for Business in Downtown Tucson- This newly built 8 story hotel hace 136 hotel rooms, 1,500 SqFt of meeting space, Spa and 6th floor pool deck. This is the first hotel built in downtown Tucson since the 1970s.[9]
Tucson Convention Center Hotel-This new hotel will sit adjacent to the Tucson Convention center and have 125 available rooms. The project is expected to cost around $2s Million.[10]
JE Dunn Proposed 20 Story Office/Retail Building- Kansas City developer has proposed plans to build a 20-story, 250,000 SqFt tower on East Broadway between Scott and Sixth Ave.[11]
Extension of Aviation Parkway Approved- The decade old plan to extend Aviation Parkway around Downtown and connect with I-10 has been approved. The project is expected to begin as early as August of 2018.[12]
Proposed Student Housing Project on the NW Corner of Euclid and Speedway- Local developer Michael Goodman and national developer Peak Campus have proposed a 5 story development consisting of 163 units as well as 8,000 SqFt of commercial space for retail and restaurants.[13]
New Project Could Bring One of the Tallest Buildings to Tucson’s Downtown Skyline- Although details are still fairly unknown, it appears a new development at the parking lot located on East Broadway between Sixth and Scott Avenues will bring a 300-foot towner with office/retail space, parking and residences.[14]
New Mid-Rise Apartment Coming to Downtown Tucson- Located next to One South Church this new six-story project will consist of ground floor commercial space for retail/restaurants as well as 100 upscale one and two bedroom apartments. Expected to be completed by the end of 2018, rent is estimated to range between $1,500 and $2,500 per month.[15]
Proposed 300 Luxury Apartments Around the Historic Benedictine Monastery- Local developer Ross Rulney has submitted plans to build two seven story buildings on the north and south end of the Monastery. The property would consist of 300 luxury apartments with the use of the existing Monastery still unknown.[16]
Benjamin Riehle what kind of purchase prices there? How are rents compared to purchase price? 1% achievable?
@Robert Herrera Can hit the 1% but it is rare. To do it you have to have targeted areas where you know the rents can get pushed up through capital improvements. Doing one right now that I purchased for $90,000, putting in $55,000 and have leased once completed for $1,500 per month. ARV on it is $220,000 so have to be able to come in cash and move quick to get them.
The growth in Tucson has been extremely exciting. The home values have just been skyrocketing and the rental market is as strong as ever.
Wow @Benjamin Riehle, great article! It gets me excited for the future in Tucson!
@Naftali Tolibas thank you! I think it is going to be a fun couple years!
I am just starting my REI journey, and was hoping to find opportunities here in Tucson, AZ without having to invest out of town. Thanks for that awesome research and list of development and growth coming our way. Funny how growing up in a place all your life, can prevent you from noticing all the change going on. I mostly see all the construction as negative because it hinders me from getting around quickly, but your post has changed my perspective. I will now look at these situations as positive because it is bringing opportunity. Thanks again for the post, is it ok if I message you with a couple questions?
@Frank Campos, absolutely, would love to help you any way I can!
Great information. I live in Tucson, thinking about buying small commercial properties. Can I reach out to you?
Nice read again, Ben!
@Benjamin Riehle Good to know. Thanks' for posting. Tucson is definitely a great place to invest in real estate right now because of it's rapid growing economy.
Thank you, everyone, for the responses. I appreciate the support and feedback. I love that Tucson is starting to come into the national light, being an investor here for 10 years.
@Sandeep Yarlagadda I am going to send you a DM.
I just read an article on the new Amazon fulfillment center that you mentioned. This is a really exciting time in the OP for sure. With all these new apartment complexes being built out, I wonder if smaller investors should focus on single family homes? This of course coming at a time when the supply of SF seems to be flying off the shelf.
Regardless, the demand as you said is growing, so there likely isn’t a wrong way to go. With the demand growing it will be harder to find good deals, but it seems like you’re, @Benjamin Riehle, having success with it. That’s great! Really found the article promising and valuable.
@Account Closed, appreciate the comment. In my opinion the opportunity is in the transitioning areas of Tucson in the Sfh and small multi-family space. We are see steady rental increase in both the Sfh and small multi space.
Our group is also becoming active in the larger commercial space. We closed on a 137 space parking lot in downtown and are looking at acquiring other buildings in that area.
There are areas of Tucson where I feel are overpriced but all in all there is ample opportunity.
Would love to connect. Feel free to shoot me a dm.
@Benjamin Riehle I am getting into the real estate investment in Tucson and would love to know more of your firm’s service!
@Benjamin Riehle great post! Thank you for the wealth of information you provided here. I live in the bay area and my parents retired from here last year and bought a house in Phoenix. I'm looking into following them with an investment property there but Phoenix is a bit out of my price range. So, I have been looking and doing my research into Tucson for a while now hoping to dive right into it soon. The information you provided is great to follow up on. Much appreciated.
