Phoenix’s West Valley Navigates Apartment Construction Boom

Article originally posted on CoStar on September 28, 2023

The West Valley in Phoenix is set to receive the largest supply addition on record this year, with more than 4,600 new apartment units expected to be completed by the end of this year.

For comparison, the region had less than 3,000 cumulative net completions from 2010 to 2019.

The West Valley includes many of the greater Phoenix area’s fastest-growing towns, including Goodyear, Buckeye, Surprise and Glendale. These areas generally offer greater affordability than other parts of the Valley, which attracts residents. In addition, their expanding and diversifying local economies provide job opportunities. Developers have ramped up construction activity in response to these rapid population gains, transforming the West Valley’s rental stock.

The West Valley has been ground zero for Phoenix’s single-family, build-to-rent construction boom. These build-to-rent developments, or BTRs, are a hybrid of single-family homes and traditional multifamily properties. They typically have the interior layout that a residential home provides, but they are plotted on small individual lots and often feature a garage, private fenced backyard and no shared walls. Since 2018, developers such as Hancock Builders, NexMetro Communities and Taylor Morrison, among others, have completed about 5,300 BTR units in the West Valley and another 1,000 are underway.

Before the most recent construction upswing, luxury multifamily properties were not common in the West Valley. High-end developers usually focused their attention on more affluent areas, including Scottsdale, downtown Phoenix and parts of the East Valley.

Aviva Goodyear is a clear example of this shifting trend. The luxury low-rise multifamily complex was built in May 2022 and is one of the area’s few five-star rental properties. The development offers a lush amenity package including a 9,000-square-foot dog park, onsite courts for basketball and pickleball, and one of the Valley’s largest resort-style pools. It is less than 5% vacant as of mid-September, indicating demand exists for this type of multifamily complex in the West Valley.

Moving forward, although construction activity is expected to downshift from this year’s record level, new completions will remain elevated by historical standards. More than 6,900 units are under construction, with Goodyear, Glendale’s Westgate Entertainment District and Surprise comprising the bulk of the pipeline.