The CHIPS Act continues to bolster markets across the US

The CHIPS Act continues to bolster markets across the US

June 17, 2024

The CHIPS Act, designed to bring semiconductor chip production back to US soil, continues to bolster markets across the US, bringing substantial economic and demographic changes with it. One market in particular, Phoenix, AZ, has emerged as a new hub for chip manufacturing, fueling economic and population growth in the region.


The CHIPS Act: A Brief Overview

The CHIPS (Creating Helpful Incentives to Produce Semiconductors) Act, signed into law in 2022, is allocating billions of dollars to support semiconductor manufacturing, research, and development domestically in the US. By incentivizing companies to establish and expand their operations in the US, the Act aims to address and correct supply chain issues while reducing dependency on foreign producers. 

This effort has been pivotal in driving investments in a number of states across the US, with Arizona standing out as an expected prime beneficiary.


Phoenix: A New Silicon Valley?

Dozens of tech companies have a presence in the Phoenix MSA as part of a shift in market dynamics that has meant that the area has become known as The Silicon Desert. Some of the notable names include Microsoft, Amazon, Carvana, Lyft, Zocdoc, and Freshly.

Now, Phoenix has emerged as a semiconductor powerhouse, thanks to significant investments spurred by the CHIPS Act. Intel and Taiwan Semiconductor Manufacturing Company (TSMC) are leading this charge, with substantial financial support from the federal government.


Intel’s Investment

Intel currently has a considerable presence in Phoenix, employing 13,000 people. The tech giant was awarded $8.5 billion in March 2024, to be distributed among four facilities, one of which is a sprawling 700-acre site southeast of Phoenix. The hub is creating 3,000 jobs during the construction phase.1

An additional 3,000 high-tech positions will be generated upon completion of the project, serving as a further boost to the local economy.


TSMC’s Expansion

TSMC, the world’s largest contract chipmaker, is receiving $6.6 billion under the CHIPS Act, and also making a major impact in Phoenix. The grant was announced in April 2024, alongside the news that the company is adding a third state-of-the-art facility to its existing complex, and is set to create 6,000 new jobs.2 This will bring TSMC’s total investment in the area to $65 billion, and further solidifies the city’s reputation as a global semiconductor production center.

The influx of these high-profile companies and the resulting job creation are driving both economic and population growth in Phoenix. 


Economic Growth

The impact of major investments in a metro area, such as those that have come from Intel and TSMC, is vast. Thousands of new jobs translate into higher income levels and increased consumer spending, benefiting local businesses and services. The median household income in Phoenix has grown 2.9% YoY.3 

Moreover, the construction and operation of the production facilities prompts further economic activity, including the demand for housing, retail, healthcare, improved infrastructure, and education services. Home prices in the city remain close to record highs recorded in 2022, and have increased ~5% YoY,4 fueling demand for rental alternatives.


Population Growth

Phoenix has experienced a population boom in recent years, as the city’s shift in dynamics continues to create job opportunities in high-tech industries and beyond. The city has seen a 4% increase in residents since 2020, growing at a rate that easily outpaces the national average amongst large metro areas.5

The city has seen wage growth of 4.4% YoY, making it an attractive market for jobseekers, and the labor force has increased 3.1% YoY.3  The workforce is young, with a median age of 34 years, and 78% work in white collar roles.6


The CHIPS Act is not just reshaping chip production in the US, it is reshaping entire cities, and areas like Phoenix are expected to see the economic benefits for years to come, while becoming a critical player in the global semiconductor landscape. Our latest cash flow-generating multifamily deal in Phoenix is positioned to take advantage of these shifting dynamics and strong market fundamentals. Log in to our platform to see detailed information.


  1. Intel: Intel’s Arizona Expansion Marks Construction Milestone / CNBC: Intel awarded up to $8.5 billion in CHIPS Act grants, with billions more in loans available
  2. AZ Central: TSMC to build third Phoenix factory with new $6.6 billion from CHIPS Act
  3. Cushman & Wakefield: Marketbeat Phoenix Multifamily Q1 2024
  4. Zillow: Phoenix, AZ Housing Market
  5. Axios: Phoenix’s population has grown by nearly 200K since 2020
  6. Point2Homes: Phoenix, AZ demographics