“Halo Vista,” as it is now known, will surround a manufacturing complex developed by Taiwan Semiconductor Manufacturing Company (TSMC)—which is already under construction and is being developed by New York-based Mack Real Estate Group in collaboration with McCourt Partners…
“It’s not just a science park, and not just a manufacturing district: It’s a community. It’s a city within a city.”
The project will include 2,300 acres with more than 28 million square feet of mixed-use development capacity, with will include up to 8,960 residential units as well as industrial, retail, and office spaces.
“Our vision is for chip designers and engineering students, not just suppliers and manufacturers, to co-locate here, to create a value added ecosystem beyond just what it takes to build chips, and that’s how we’re going to create more value in the Phoenix economy,” Mack said.
Build the facility for the hot industry and let the development grow around it.
While it sounds like the community would be independent from the company and manufacturing facility, is this a new version of a company town? There is a long history in the United States of communities developing around industry, whether it is the Pullman district in Chicago or development around auto plants in and near Detroit to Silicon Valley growth. This can all “work” if the industry is humming along.
At the same time, it may not be so great for those not involved with good jobs in that industry. It may not necessarily be good for the community as a whole. And if the industry itself stops growing or declines, there can be trouble for these communities.
The Valley is one of the fastest-growing regions in America, where a developer decided to put a city of the future on a piece of virgin desert miles from anything. At night, from the air, the Phoenix metroplex looks like a glittering alien craft that has landed where the Earth is flat and wide enough to host it. The street grids and subdivisions spreading across retired farmland end only when they’re stopped by the borders of a tribal reservation or the dark folds of mountains, some of them surrounded on all sides by sprawl.
Phoenix makes you keenly aware of human artifice—its ingenuity and its fragility. The American lust for new things and new ideas, good and bad ones, is most palpable here in the West, but the dynamo that generates all the microchip factories and battery plants and downtown high-rises and master-planned suburbs runs so high that it suggests its own oblivion. New Yorkers and Chicagoans don’t wonder how long their cities will go on existing, but in Phoenix in August, when the heat has broken 110 degrees for a month straight, the desert golf courses and urban freeways give this civilization an air of impermanence, like a mirage composed of sheer hubris, and a surprising number of inhabitants begin to brood on its disappearance.
Growth keeps coming at a furious pace, despite decades of drought, and despite political extremism that makes every election a crisis threatening violence. Democracy is also a fragile artifice. It depends less on tradition and law than on the shifting contents of individual skulls—belief, virtue, restraint. Its durability under natural and human stress is being put to an intense test in the Valley. And because a vision of vanishing now haunts the whole country, Phoenix is a guide to our future.
Several thoughts in response:
How many Americans know Phoenix is the fifth-largest city in the country – growing from over 106,000 residents in 1950 to over 1.6 million today – and the tenth-largest metropolitan area?
Like many American communities, Phoenix and the region depends on growth. More residents, more business activity, more infrastructure. What happens to Phoenix when/if growth slows? How would a mature region in 50 or 100 years look similar or different?
The environment plays a role in Phoenix and the region. At the same time, Phoenix expanded at a particular point in American history, later than many big cities. How do these two factors intersect?
How would urban sociologists think about Phoenix compared to other American cities and region? Is it more unusual or does it follow similar patterns to other sprawling regions? What marks Phoenix as unique? Do the same social, political, and economic factors propel the region or is there something different going on?
“Why would anyone live in Phoenix?” You might ask that question to the many hundreds of thousands of new residents who have made the Arizona metropolis America’s fastest-growing city. Last year, Maricopa County, where Phoenix sits, gained more residents than any other county in the United States—just as it did in 2021, 2019, 2018, and 2017.
At its core, the question makes a mystery of something that isn’t a mystery at all. For many people, living in Phoenix makes perfect sense. Pleasant temperatures most of the year, relatively inexpensive housing, and a steady increase in economic opportunities have drawn people for 80 years, turning the city from a small desert outpost of 65,000 into a sprawling metro area of more than 5 million. Along the way, a series of innovations has made the heat seem like a temporary inconvenience rather than an existential threat for many residents. Perhaps not even a heat wave like this one will change anything…
Outside the summer months, the quality of life in Phoenix is really quite high—a fact that city boosters have promoted stretching back to before World War II. They traded the desiccated “Salt River Valley” for the welcoming “Valley of the Sun.” Efforts to downplay the dangers of Phoenix’s climate go back even further. In 1895, when Phoenix was home to a few thousand people, a local newspaper reported that it had been proved “by figures and facts” that the heat is “all a joke,” because the “sensible temperature” that people experienced was far less severe than what the thermometers recorded. “But it’s a dry heat” has a long history, one in which generations of prospective newcomers have been taught to perceive Phoenix’s climate as more beneficial than oppressive.
Most people surely move to Phoenix not because of the weather, but because of the housing. The Valley of the Sun’s ongoing commitment to new housing development continues to keep housing prices well below those of neighboring California, drawing many emigrants priced out of the Golden State. Subdivisions have popped up in irrigated farm fields seemingly overnight. In 1955, as the home builder John F. Long was constructing Maryvale, then on Phoenix’s western edge, he quickly turned a cantaloupe farm into seven model homes. Five years later, more than 22,000 people lived in the neighborhood; now more than 200,000 do. Even today, the speed of construction can create confusion, as residents puzzle over the location of Heartland Ranch or Copper Falls or other new subdivisions that include most of the 250,000 homes built since 2010…
“Why would anyone live in Phoenix?” serves as nothing more than a defensive mechanism. It makes peculiar the choices that huge numbers of Americans have made, often under economic duress—choices to move to the warm climates of the Sun Belt, to move where housing is affordable, to ignore where energy comes from and the inequalities it creates, and, above all, to downplay the threats of climate change. In that way, Phoenix isn’t the exception. It’s the norm.
At some point, such growth may not be possible. For example, water supplies might not hold up. Or, Americans might decide a car-dependent life is no longer as desirable.
Another big factor that might slow growth is rising housing prices. If cheaper housing is indeed driving many people to Phoenix, more expensive housing might send people elsewhere. Phoenix is not the cheapest market people could go to. Right now it is popular and growing but this does not necessarily have to last.
Arizona officials announced Thursday the state will no longer grant certifications for new developments within the Phoenix area, as groundwater rapidly disappears amid years of water overuse and climate change-driven drought.
A new study showed that the groundwater supporting the Phoenix area likely can’t meet additional development demand in the coming century, officials said at a news conference. Gov. Katie Hobbs and the state’s top water officials outlined the results of the study looking at groundwater demand within the Phoenix metro area, which is regulated by a state law that tries to ensure Arizona’s housing developments, businesses and farms are not using more groundwater than is being replaced.
The study found that around 4% of the area’s demand for groundwater, close to 4.9 million acre-feet, cannot be met over the next 100 years under current conditions – a huge shortage that will have significant implications for housing developments in the coming years in the booming Phoenix metro area, which has led the nation in population growth.
State officials said the announcement wouldn’t impact developments that have already been approved. However, developers that are seeking to build new construction will have to demonstrate they can provide an “assured water supply” for 100 years using water from a source that is not local groundwater.
The sprawl of the United States depends on cheap and abundant water available for the new properties. Phoenix is not alone in pursuing sprawl or in not having to think much about water for a long time.
However, the immediate and long-term future in at least a few metro areas involves a lack of water. This is certainly an issue in the West and Southwest. It could be in play in other regions as well.
Joe McCue thought he had found a desert paradise when he bought one of the new stucco houses sprouting in the granite foothills of Rio Verde, Ariz. There were good schools, mountain views and cactus-spangled hiking trails out the back door.
Then the water got cut off.
Earlier this month, the community’s longtime water supplier, the neighboring city of Scottsdale, turned off the tap for Rio Verde Foothills, blaming a grinding drought that is threatening the future of the West. Scottsdale said it had to focus on conserving water for its own residents, and could no longer sell water to roughly 500 to 700 homes — or around 1,000 people. That meant the unincorporated swath of $500,000 stucco houses, mansions and horse ranches outside Scottsdale’s borders would have to fend for itself and buy water from other suppliers — if homeowners could find them, and afford to pay much higher prices…
Water experts say Rio Verde Foothills’ situation is unusually dire, but it offers a glimpse of the bitter fights and hard choices facing 40 million people across the West who rely on the Colorado River for the means to take showers, irrigate crops, or run data centers and fracking rigs.
Given conditions in the West and Southwest, this could become more common for suburban areas. See earlier posts here and here.
One key from the article: when you move into a home, is the water supply guaranteed (as much as possible)? It sounds like there was an agreement to sell water to this new development. If you have such agreements or live in unincorporated areas or depend on other water sources, will they always be there?
Water is typically one of the lower concerns of those moving to the suburbs. It is assumed to be there. There might be the occasional problem with pipes, particularly in older homes, but the water should keep flowing. Other infrastructure concerns tend to take precedence; are there enough roads for new residents? Schools?
Without cheap water, it is harder to live the suburban life. As the article notes, how does one wash laundry or dishes with limited or really expensive water? Flushing toilets? This does not even get close to beloved amenities, like swimming pools.
“People say, ‘Are you surprised?’ And I say, ‘No, not really, because all of the housing forces in Phoenix and Maricopa County have been working against us for years,’” said Human Services Campus Executive Director Amy Schwabenlender, who works in the area with the encampment, sometimes referred to as “the Zone.” “We’ve had ongoing population increases in Phoenix and Maricopa County. We haven’t had housing production at all income levels keep up and meet that increase in population.”
Real estate investors are pouring cash into Phoenix and driving up prices. Rents there have spiked 25.6% over the past year, compared to a 15.9% increase in the U.S. from January 2021 to January 2022, according to data analyzed by Zillow. (Other popular Sun Belt cities like Miami and Tampa have also seen dizzyingly fast increases in rent.) Vacancy rates in Phoenix, or the availability of places for people to rent, are also at their lowest in 50 years, according to the Arizona Republic.
While much of the rest of the article focuses on addressing housing for the homeless, this sounds like a bigger issue. This is an area with a growing population: Phoenix is now the fifth-largest city in the US and had a little over 100,000 residents in 1950 before experiencing double-digit percentage population growth in all but one decade since. Housing opportunities, particularly in rentals, have not kept up. American sprawl often produces a lot of single-family homes but necessarily cheaper houses or multi-family units for those who cannot secure a sizable mortgage.
What can Phoenix and surrounding communities do? Addressing housing in the United States is a difficult task. It will take concerted effort across communities for years. It may not be popular. But, it is essential for ensuring housing for all who need it.
It would be great to have an example of a city and region in the Sun Belt – roughly Virginia to southern California – that has successfully addressed this even as they have experienced significant growth in recent decades. I do not know if there is a great example, outside of some places not becoming too popular such that it raises demand and housing prices.
Tech firms chose the Phoenix area because of its preponderance of cookie-cutter homes. Unlike Boston or New York, the identikit streets make pricing properties easier. iBuyers’ market share in Phoenix grew from around 1 percent in 2015—when tech companies first entered the market—to 6 percent in 2018, says Tomasz Piskorski of Columbia Business School, who is also a member of the National Bureau of Economic Research. Piskorski believes iBuyers—Zillow included—have grown their share since, but are still involved in less than 10 percent of all transactions in the city…
Barton told analysts that the premise of Zillow’s iBuying business was being able to forecast the price of homes accurately three to six months in advance. That reflected the time to fix and sell homes Zillow had bought…
In Phoenix, the problem was particularly acute. Nine in 10 homes Zillow bought were put up for sale at a lower price than the company originally bought them, according to an October 2021 analysis by Insider. If each of those homes sold for Zillow’s asking price, the company would lose $6.3 million. “Put simply, our observed error rate has been far more volatile than we ever expected possible,” Barton admitted. “And makes us look far more like a leveraged housing trader than the market maker we set out to be.”…
To make the iBuying program profitable, however, Zillow believed its estimates had to be more precise, within just a few thousand dollars. Throw in the changes brought in by the pandemic, and the iBuying program was losing money. One such factor: In Phoenix and elsewhere, a shortage of contractors made it hard for Zillow to flip its homes as quickly as it hoped.
It sounds like the rapid sprawling growth of Phoenix in recent decades made it attractive for trying to estimate and predict prices. The story above highlights cookie-cutter subdivisions and homes – they are newer and similar to each other – and I imagine this is helpful for models compared to older cities where there is more variation within and across neighborhoods. Take that critics of suburban ticky-tacky houses and conformity!
But, when conditions change – COVID-19 hits which then changes the behavior of buyers and sellers, contractors and the building trades, and other actors in the housing industry – that uniformity in housing was not enough to easily profit.
As the end of the article suggests, the algorithms could be changed or improved and other institutional buyers are also interested. Is this just a matter of having more data and/or better modeling? Could it all work for these companies outside of really unusual times? Or, perhaps there really are US or housing markets around the globe that are more predictable than others?
Like the Phoenix, Atlanta had risen from its own ashes following its destruction in 1864. Many times during the city’s history, Atlanta has redefined and reinvented itself, rising again as the city slogan, Resurgens, suggests. The “Atlanta Spirit” is another oft-referenced slogan describing an entrepreneurial and ambitious attitude that has shaped the city’s historical identity.
On October 11, 1871, three days after the fire started that devastated the city, Bross’s Tribune proclaimed, “CHEER UP. In the midst of a calamity without parallel in the world’s history, looking upon the ashes of thirty years’ accumulations, the people of this once beautiful city have resolved that CHICAGO SHALL RISE AGAIN.”
Bross, who was an avid promoter of the city, predicted that Chicago would be rebuilt in five years and would reach a population of 1 million by the turn of the century, as Donald Miller reports in City of the Century.
There is an accepted narrative that the fire created a blank slate upon which Chicago was quickly rebuilt. That blank slate allowed it to become a dynamic city of innovative architecture with a fresh skyline dotted with a brand-new building called the skyscraper.
“The great legend of Chicago is that it’s a ‘phoenix city’ – it almost instantly rebuilt itself bigger and better from the ashes. And to a certain and significant extent, that’s true,” said Carl Smith, professor emeritus of English at Northwestern University and author of Chicago’s Great Fire: The Destruction and Resurrection of an Iconic American City.
Those former residents were industrious, enterprising and imaginative. They built an irrigation system, consisting mostly of some 135 miles of canals, and the land became fertile. The ultimate fate of this ancient society, however, is a mystery. The accepted belief is that it was destroyed by a prolonged drought. Roving Indians, observing the Pueblo Grande ruins and the vast canal system these people left behind, gave them the name “Ho Ho Kam” — the people who have gone…
By 1868, a small colony had formed approximately four miles east of the present city. Swilling’s Mill became the new name of the area. It was then changed to Helling Mill, after which it became Mill City, and years later, East Phoenix. Swilling, having been a confederate soldier, wanted to name the new settlement Stonewall after Stonewall Jackson. Others suggested the name Salina, but neither name suited the inhabitants. It was Darrell Duppa who suggested the name Phoenix, inasmuch as the new town would spring from the ruins of a former civilization. That is the accepted derivation of our name.
Many cities have faced crises, disasters, or unusual starts. Local histories and narratives can also emphasize positive moments (and downplay negative moments). The rising from the ashes, overcoming great obstacles, coming back to life, these are all powerful narratives for big cities. They imply success, progress, and hopefully growth.
What these narratives mean now may be harder to ascertain. What does the aftermath of the Chicago Fire mean for Chicago today? Is Phoenix still rebuilding a great civilization? More than 150 years after the Civil War, is Atlanta continuing to reinvent itself? A city rising from the dead once is impressive but it may be harder to pull off over decades of change.
Home building has been steadily picking up this past year after taking a sharp nosedive during the recession, although production is still far below historical norms. Orr said home builders are moving forward with cautious optimism, being wary of their pre-recession mistake of overbuilding.
So to help make up for the slowdown, builders are now making homes larger once again. Bigger homes means bigger sales revenue — and for only a minimal bump in construction costs, Orr said.
The trend has been to the detriment of first-time and lower-income buyers, who are finding both the new and existing home markets offer them very few options today.
“They (home builders) have kind of abandoned that sector,” Orr said.
The existing home market nationwide — but particularly in Phoenix — has been facing a chronic shortage of homes for sale, and the problem is most severe in price ranges below $200,000.
Many buyers have thus turned to new construction out of frustration. But given the sharp price hikes of new homes recently, lower-income buyers aren’t finding the same relief, Orr said.
In other words, builders can make more money on the bigger homes for those who still have money to play with. But is this just about builders? I wonder if there are two other things going on here:
1. The article hints at a depressed existing house market, suggesting that there isn’t enough movement in the housing market for these older smaller homes, what might be called “starter homes,” to become available in large numbers.
2. In addition to not much existing inventory opening up, perhaps there simply aren’t enough buyers for smaller houses for builders to take notice. What numbers are we talking about – how many first-time home buyers in the Phoenix are not able to find a home they want? This reminds me of recent data from the Chicago area: while housing starts may be up a large percent, the housing market is still not operating at normal.
That all said, if people want to get into purchasing a home can’t do so or are delayed, this could contribute to more long-term problems for the US housing market.
That Coors and Chase Fields had diverging fates is no accident but rather the result of poor planning, write Arizona State researchers Stephen Buckman and Elizabeth A. Mack in a recent issue of the Journal of Urbanism. Phoenix’s attempt to copy Denver’s success shows that sports stadiums are not a one-size-fits-all solution to downtown redevelopment efforts. On the contrary, Buckman and Mack argue, these projects must strongly consider the natural form of the city to avoid failure:
A key consideration that is often overlooked in the planning phase of these projects is the historical urban growth patterns and resulting urban form of the cities in which stadium development projects are proposed.
Buckman and Mack conducted a point-by-point review of both stadiums in their effort to determine what factors contributed most to their success, or lack thereof. They quickly found that population differences weren’t the source of the difference. Phoenix and Denver had similar demographic profiles at the time the fields were being proposed, with no marked variations in age of the potential fan base or ability to pay for tickets.
Where they began to see a clear difference was in urban form. Metropolitan Phoenix is a widespread area without a distinctive downtown core. Its satellite cities of Glendale, Tempe, and Scottsdale all have significant attractions and downtowns of their own that create what the researchers call a “centrifugal effect” on potential visitors to downtown Phoenix. By some estimates, Phoenix has the least developed downtown core in the country.
Denver, on the other hand, has a historic core that dates back to the city’s founding in 1858. In addition, the city itself is far less expansive: encompassing only about 150 squares miles, to more than 9,000 for metropolitan Phoenix. The result of this urban form, for Denver residents, is a considerably more convenient proximity to the stadium.
More broadly, it sounds like having key structures in and near the baseball stadium is very important, perhaps even more so than the particulars of the stadium itself. In other words, building a stadium with little already existing around it might have little impact on the surrounding area. Downtowns work because they are clusters of activity; there are not just office buildings but also nearby residences, restaurants, and cultural institutions that help insure a broad range of visitors to the downtown. Baseball games then become another activity that people want to go to because the games are part of the scene of the whole area.
I visited Coors Field for the first time this past August during the 2012 American Sociological Association meetings. Since I was staying near the Convention Center, we had to walk about 15 minutes to the stadium. The walk was pleasant in itself; Denver has a nice scene between these two destination points. Unlike some other major cities where the downtown is dominated by large buildings, this area has primarily low-rise buildings. People are outside walking around or eating. The stadium itself seemed to be at the edge of the downtown area closer to I-25 but it was clear plenty of other fans were also walking through the surrounding LoDo neighborhood and enjoying the night.
Another question I would ask as a baseball fan: could attendance be boosted in a more dispersed region if the team was winning? Or do parks like Wrigley Field win at attendance with little effect of record because fans want to have the experience?
By the way, here is a picture from my seat. While Coors Field might be more successful than Chase Field, the team was not good last year and there were plenty of empty seats as well as cheap seats online.
Legally Sociable 