GHC Thematic Report: Intel’s $20B Investment Bodes Well For Ohio and Multi-Family Housing
A revival of the industrial heartland is on the horizon. While Ohio was once a booming center for manufacturing, in recent decades, the industry lost steam, leading to an overall decline in the state’s manufacturing employment. Now, with a strong infrastructure already in place, Ohio will soon become home to what may be the largest chip manufacturing complex in the world.
Intel announced New Albany, a Columbus suburb, as the site for two new chip manufacturing plants, also known as fabs. These fabs will be part of a larger 1,000 acre complex that is expected to cost at least $20 billion initially, with potential to grow to $100 billion over the next decade. Construction on the complex will begin this year, with the first two fabs ready for production by 2025. This milestone project will be the largest economic development in Ohio’s history and create downstream growth across the state.
Intel’s spend is an investment in Ohio residents, providing thousands with livable wages. The downstream impacts from a project of this scale are massive and will spread across Ohio due to the connectivity of its cities/towns via highway systems and rail. As this growth spreads across Ohio, it will continue to support occupancy trends and provide upward rent pressure in Ohio’s multi-family housing market.
Ohio as the Choice for New Chip Manufacturing Complex
Intel’s new endeavor is their first expansion into a new state in over 40 years. This project holds great importance in the country’s economy, making a location that could support its success crucial. The United States currently produces around 12% of the world’s micro chips, while Taiwan is responsible for the majority. With a goal to ramp up U.S. chip production, Intel began their search for their new location in May of 2021 and concluded on Christmas day when they announced Ohio as their choice state.
“There were 40 states competing to get these plants — and we won,” said the Ohio Governor, Mike DeWine. Ohio’s appeal lies largely in its location and resources. The natural resources, raw materials, and energy Intel needs are readily available at a low cost.
Ohio’s central location is also ideal for receiving supplies and shipping finished chips. This offers Intel the opportunity to bring their microchips to automotives, computers, and other industries that are highly prevalent in the surrounding geographical region.
Fabs’ Impact on Ohio
While Ohio is working diligently to set up this project for success, the state’s relationship with Intel is symbiotic. The Intel fabs are expected to employ 3,000 Ohioans, in addition to 7,000 short-term construction jobs and thousands of permanent positions at suppliers and partners. Air Products, Applied Materials, LAM Research, and Ultra Clean have already announced their plans to set up locations in Ohio to support the new fabs.
Intel will also be investing $100 million into partnerships with educational institutions across the state. This creates a stream of future talent for Intel, and provides Ohio pull for future investments. The Ohio region may soon be retiring their title as the Industrial Heartland to, as CEO of Intel, Patrick Gelsinger said, the “silicon heartland”.
Supporting Workforce Growth Through Multifamily Investments
The impacts of this project will be felt throughout all of Ohio. Being only an hour and a half away from Cleveland, it falls within the city’s broader ecosystem. “These fabs have the opportunity to be the catalyst for generational change to the Northeast Ohio region and state at large, providing jobs at livable wages to thousands of Ohio residents,” said Michael Smith, Principal of Green Harvest Capital.
“That's why we are investing in multifamily housing, for the workforce of today and tomorrow,” said Bhavin Patel, Principal of Green Harvest Capital. With over 700 apartments in the Northeast Ohio region, Green Harvest Capital is passionate about the Ohio marketplace. Intel’s investment is not just an investment in the micro chip industry, but also one in the state and residents of Ohio. With this investment, comes the opportunity for statewide transformative growth.
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