Columbus: The Silicon Heartland

The Columbus MSA ended 2022 at $3B in multifamily transactional volume. Investors continued to flock to the metro driven by public and private investment, a business-friendly climate, strong housing supply and demand fundamentals, a well-educated renter base, a highly diverse economy, and numerous other factors.

Highlighted below are a select few major private and public investments that occurred recently in the “Silicon Heartland.”

Intel announced in late 2021 that the company is building two semi-conductor facilities in New Albany (suburban Columbus), which represents a $20B investment. In July 2022, Intel closed on the nearly 1,000-acre site with anticipation to have the site operational by 2025. 

Upon completion, the plant will be the largest semiconductor plant on Earth. Accommodating up to eight microchip factories, total investment from Intel is estimated upwards of $100B, creating over 10,000 jobs over the next decade. Intel has announced it expects to hire 50 percent of its Ohio workforce in 2023-24.

On August 9th, 2022, The Biden-Harris Administration signed the CHIPS and Science Act of 2022. This bipartisan bill will strengthen American semiconductor research, development, and production to ensure America continues to be a leader in technology and promotes production in the United States. The act will help ensure the success and production of the Intel plant.

Private corporation investments in the Silicon Heartland

On the heels of Intel’s announcement, numerous private corporations pledged significant investments into development and expansion within the Columbus MSA.

VanTrust is building a 500-acre New Albany Tech Park near Intel, which will host up to 5M SF of industrial, data, and warehouse space. The project has already broken ground and is expected to be completed and functioning at the end of 2023. VanTrust has built six industrial buildings in New Albany since 2019, ranging from 250K-768K SF.

Lincoln Property Company & Harrison Street acquired 190 acres and are planning a Silicon Heartland Innovation Park for industrial use and creation of a data center that could total 1.2M SF. Lincoln Property Company’s Midwest team has begun construction on the first phase of its campus. Lincoln Rackhouse, the data center division of Lincoln Property Company, has also started on construction of the data center campus, which will include a 200MVA electrical substation. The company has secured a 15-year, 100 percent real estate tax abatement for this project.

Pharmavite recently announced plans to invest $200M in the Intel development site, creating a 200K SF manufacturing and bottling factory and adding over 225 full time jobs to the area. With this expansion, the company will be able to increase production capacity and its Midwest and East Coat market service. This plant is expected to be up and running at the end 2024. 

Amazon recently purchased four hundred acres for $117M within minutes of the Intel site. A proposal has surfaced with a 7.5M SF data center complex featuring eighteen data center buildings, generator pads, and an office building. A second project called North Beech Corridor has proposed a 4.7M SF data center complex with eleven data center buildings, generator pads, two office buildings, and a substation. Amazon currently occupies ten facilities in Central Ohio.

Meta (Facebook) announced expansion plans in 2022 of its New Albany data center operations from its current $500M investment to a total of $1.5B across two new data centers.

Despite a dynamic economic environment, multifamily performance in Columbus has remained strong. Occupancy ended 2022 in the Columbus MSA at 96.8 percent and according to AXIO, rent growth year-over-year was 9.27 percent. The Columbus metro continues to see an influx of institutional capital. We expect to see a continued focus on quality de-risked assets, increased scrutiny on underwriting and returns metrics, and a focus on the undersupply relative to current and future demand.

Interested in learning more? Connect with our Midwest Investment Sales team today.