Arizona currently ranks sixth in the country for combined acreage available for sale in the state, according to Land Network Data. Right now the overall value of land for sale in the state amounts to $5 billion and covers almost 900,000 acres. As a result, commercial land investment in Arizona is bustling.
According to Anita Verma-Lallian, CEO and Founder of Arizona Land Consulting, the land market in Arizona is doing extremely well at the moment. In the past few months, Verma-Lallian said, the state saw a significant amount of growth. Although there was a bit of a slowdown over the summer — as people were traveling, and there was some uncertainty with regards to inflation and interest rates — the market is growing once again as fall begins.
“A lot of people are moving here from California,” Verma-Lallian said. “And we just have a limited supply of land, so we’re really starting to see land values go up pretty quickly.”
However, Verma-Lallian said this is still a good time for investors and developers to pursue land in Arizona. At Arizona Land Consulting, Verma-Lallian’s boutique land consulting firm, they find different parcels of land throughout the state that meet their clients’ needs. The firm works with investors that are looking for investment opportunities, as well as developers who are looking for specific sites to develop properties.
“Essentially, we find land sites for various groups,” Verma-Lallian explained.
Verma-Lallian added, “If you’re able to position yourself in the path of growth, I think you’re going to do well.”
And Arizona is certainly on a path of growth.
For commercial real estate developers who are looking for land in Arizona, Verma-Lallian said, there is currently a lot of land for industrial use that hasn’t been impacted by growing interest rates.
“We have industrial sites, we have multifamily sites for apartments built for rent units, and then we have different residential sites as well,” Verma-Lallian noted.
There are also plenty of properties available for investment, she added.
Nonetheless, there are some challenges. In Arizona there’s a scarcity of water. Pieces of land that have access to water are in higher demand, and Verma-Lallian noted that they would become “gold mines” in the future. For land that doesn’t have access to water, unfortunately, it becomes a little bit harder to get water to the property. That challenge is something for investors and developers to keep in mind when looking at different properties.
Before investing in any land in Arizona, Verma-Lallian recommended analyzing the infrastructure. Make sure the infrastructure exists for whatever you’re looking to develop, she said. Then, pay attention to zoning, and make sure the zoning laws are amenable to your particular use.
It’s also a good idea, Verma-Lallian advised, to partner with a firm like Arizona Land Consulting that has access to these properties, especially if you’re new to Arizona investments.
“We’ve accessed a lot of off market listings,” Verma-Lallian said. “We can also connect groups with the contacts of the different cities and municipalities that can help guide what they’ll allow on the land, and so on and so forth.”
Investors and developers need to act fast, though, as land is getting sold pretty quickly.
“I was just looking at a map of an area called Casa Grande, which is right next to where they’ll build some factories,” Verma-Lallian said. “And if you look at what’s been sold in the last few months and what’s in escrow, the land supply is really diminishing quickly.”
Verma-Lallian suggested, if you’re looking for land in Arizona, start looking as soon as possible because demand is high right now.
As a whole, when compared to states like California, for instance, Verma-Lallian argued that Arizona makes for a better investment. In California, property taxes are higher, utilities are more expensive to operate and land costs are higher, so “Arizona just makes a lot of sense.” People are currently migrating from all over because the state is pro-growth, tax-friendly to investors and has a lot of legislation that helps developers get started.