This article was originally published on Multifamily Executive. View it here.
The bipartisan passage of the CHIPS and Science Act in 2022 was a watershed moment for the semiconductor industry, setting the stage for the United States to reshore production from low-cost countries and regain ground lost to foreign competitors. Because it costs $10 billion to build a modern fabrication (fab) facility, the Act has the potential to reshape local multifamily markets, creating jobs, stimulating demand, and creating opportunities for investors in cities receiving the largest infusion of funds.
Bringing It Back Home
American scientists invented the semiconductor in 1947, but by 2020, the U.S. share of global semiconductor manufacturing had fallen to just 12%. Although the U.S. has continued to lead the world in the design of the most advanced chips, none of them are made here, jeopardizing economic and national security. And as events in recent years have shown, the U.S. is vulnerable to disruptions to the semiconductor supply chain. In the aftermath of the pandemic, the scarcity of plain vanilla legacy chips brought the automotive industry to a standstill.
Funds from the CHIPS Act are being used to revive semiconductor manufacturing, support R&D, and encourage workforce development—and the amount of funding is commensurate with these goals. As of January 2025, according to the Semiconductor Industry Association, the U.S. had committed $32.5 billion in grants to 31 companies across 48 projects in 23 states. The projects, estimated to add up to more than $380 billion over two decades, are expected to create 145,000 new jobs—33,000 manufacturing jobs and 102,000 construction jobs. The government expects that by 2032, the U.S. will produce nearly 30% of the global supply of leading-edge chips.
Of course, these announcements and estimates should be taken with a small grain of salt. Private investment has a way of shrinking—and construction of complex chip fab plants inevitably faces delays. In addition, the CHIPS Act has come under recent scrutiny from President Trump, although republican lawmakers have balked at his call to defund the law. Nonetheless, funds have been committed, and companies like Intel, TMSC, and Samsung have already made substantial progress on new facilities.
It is the sheer size and complexity of these facilities—with massive investments channeled to very specific locations—that creates opportunity for multifamily investors. Among the dozens of projects supported by the CHIPS and Science Act, nine have budgets ranging from $11.6 billion to $100 billion. Some of these projects are underway outside smaller markets like Columbus, Ohio, and Syracuse, New York, which previously had limited or no semiconductor activity. In these instances, the infusion of capital has the potential to transform their entire multifamily ecosystem. Others are in well-established multifamily markets like Austin and Phoenix, which already have a thriving semiconductor sector. In these cities, CHIPS Act development, which tends to be on the far edges of an MSA where land is cheapest, has the potential to transform a selection of submarkets.
Intel Drives a Tech Boom in Columbus
After a nationwide competition, Intel announced in 2022 that it would build its most advanced semiconductor manufacturing facility in New Albany, Ohio, a 25-minute commute from downtown Columbus. Intel is investing $28 billion—including a $1.5 billion contribution from the CHIPS Act—to build two fabs on a 1,000-acre mega site, generating 3,000 permanent jobs. After a period of delay, they are expected to open in 2030.
The follow-on effect is already in evidence. Amazon, Google, and Microsoft have all declared their intention to build new data centers in the New Albany area or expand existing facilities. In 2023, Amazon Web Services announced plans to spend $3.5 billion to grow its data operations in New Albany and purchased almost 400 acres near the Intel site. Google has already completed a data center in New Albany and announced a $1.8 billion investment to create two more Columbus-area facilities, while Microsoft recently bought 500 acres of land in Licking County, including 200 acres in New Albany, for a series of data center campuses.
The prospects for the Columbus multifamily market were good even before these announcements. Its population is growing, and it has a thriving economy anchored in education and state government. These advantages were underscored by the Columbus Regional Airport Authority’s decision to break ground in 2025 on a new 36-gate, $2 billion terminal at John Glenn International Airport.
The tech boom will only reinforce the Columbus multifamily market strengths. Supply and demand in Columbus are well balanced. In 2024, 6,103 units were delivered while 5,859 were absorbed, according to CoStar. Despite a softening of high-end unit absorption, mid-priced units saw strong demand, driven by the strong job market. Overall, rent growth has been steady for the last year at nearly 3%. The influx of chip fabs and data centers has the potential to turn a solid multifamily market into a stellar one.
Micron Offers Syracuse a New Future
There was a time in the aftermath of World War II when upstate New York was a juggernaut of innovation and manufacturing. IBM was originally based in Endicott, General Electric in Schenectady, and Kodak and Xerox in Rochester. In the last quarter of the twentieth century, however, these businesses faded away or moved elsewhere. New York’s leadership saw CHIPS Act funding as a way to revitalize the region. Among other initiatives, it created the Governor’s Office of Semiconductor Expansion, Management, and Integration (SEMI), which played a major role in securing for the state more than $6 billion in federal grants.
One of the largest CHIPS Act awards was a $4.6 billion grant to Micron Technology, an American producer of computer memory and data storage. The company is using the funds to help finance the construction of the first two of a planned four-fab complex in Clay, New York, the most populous suburb of Syracuse. The facility will produce advanced dynamic random-access memory (DRAM), which is crucial to advancing U.S. leadership in a host of fields including AI. Currently, all leading-edge DRAM chip manufacturing takes place in East Asia.
The scale of this project is breathtaking. Each fab will have 600,000 square feet of cleanrooms, and, when completed, it will be the largest cleanroom facility in the U.S. (the size of nearly 40 football fields) and employ 9,000 skilled workers. Micron estimates that the overall project will cost $100 billion over two decades.
In 2024, Onondaga County, encompassing Syracuse as well as its suburbs, issued a housing report that assesses the impact of the Micron complex on the area’s housing market. It concluded that without Micron, the multifamily market will grow by less than 2,000 units between 2020 and 2040. With Micron added to the mix, the outlook changes dramatically. It would need 10,000 new multifamily units (as well as 15,000 single-family homes) to accommodate population growth stimulated by the plant.
The multifamily market in the Syracuse metro is already tight. Outer Ring North, which includes Clay, had 3,570 multifamily units as April 2024, most of which were built since 2000, with a vacancy rate of 2.7%. Average rent is $1,281. These low vacancy rates are expected to persist. According to a report by Apartment Advisor, Syracuse was the most competitive apartment market in the U.S., even exceeding New York City.
Intel and TSMC Build on the Outskirts of Phoenix
In smaller cities like Columbus and Syracuse, CHIPS Act projects have the potential to energize the local economy, changing the trajectory of the entire metro and the multifamily market. In larger cities, especially those with a well-entrenched semiconductor industry, the effects will be substantial but subdued. In Phoenix, the semiconductor industry goes back to 1949, when Motorola opened a research lab in the small desert town of 107,000 people. In 1980, Intel opened its first semiconductor plant in the southeastern suburb of Chandler, becoming one of the state’s largest employers. Phoenix is now home to more than 75 semiconductor companies, making it one of the largest chipmaking hubs in the U.S.—and it is about to get even bigger.
In 2020, Taiwan-based TSMC announced plans to build three fabs in Phoenix worth a combined $65 billion, the largest foreign direct investment in the state’s history. TSMC now manufactures over 90% of the world’s leading-edge logic chips, which are used to power everything from smartphones to high-performance computers. The facility, located in Phoenix’s lightly populated North Gateway area, at the intersection of I-17 and Loop 303, will employ 6,000 workers when complete. TSMC received a $6.6 billion grant from the CHIPS Act for the project.
In 2021, Intel announced plans to modernize its existing facility and build two new fabs at its Ocotillo campus, which is located at the western edge of Chandler. The facility will become Intel’s largest anywhere, adding 3,000 employees to the 13,000 it has at Ocotillo and its original Chandler campus. Intel has received $3.9 billion in CHIPS Act funding for the project, out of an overall cost of $32 billion. The new facilities are expected to begin operations in 2025.
Most of the multifamily demand in Phoenix is spread along the ring of small cities that surround Phoenix and Scottsdale. Chandler, in particular, is seen as a strong market and one of the most resilient in the metro. It has the highest occupancy rate and a year-over-year annual decline of only 0.4%. In addition to Intel, NXP Semiconductors has two wafer fab facilities in Chandler, which has a popular downtown and numerous entertainment options. At the end of Q2 2024, the occupancy rate in Chandler (94.2%) was on the rise, although average rents, while among the highest outside the central core, had declined to $1,728.
North Gateway is also promising. The City of Phoenix forecasts that 8,080 new multifamily units will be built there between 2020 and 2030. This is the third highest projection of any of Phoenix’s 15 urban villages.
Samsung Will Help Austin Soak Up Supply
Austin has long been a hub for the semiconductor industry, hosting research and development (thanks to the presence of the University of Texas at Austin), and manufacturing. For almost 30 years, Samsung Austin Semiconductor has been a mainstay of the city’s economy and is the only major semiconductor company that is a leader in both advanced memory and logic technologies.
The $4.75 billion in direct funding it is receiving under the CHIPS Act will enable it to expand and upgrade its existing East Austin facility to produce specialized chips critical to the U.S. aerospace, defense, and automotive industries. In addition, the funds will enable Samsung to create a comprehensive manufacturing ecosystem in Taylor, a small city just 30 minutes from the state capital. It will consist of two chip fabs and an R&D lab, exploring manufacturing processes to be deployed several generations into the future. The whole complex, costing $37 billion, will support 1,700 jobs.
All this is good news for the Austin multifamily market, which has suffered from an overhang of supply despite healthy rental demand. In the last two years, Austin has been stung by negative rent growth and high vacancy rates, but there are signs that the Round Rock area in northeast Austin, which is closest to Taylor, has begun to benefit from its proximity to the new Samsung complex in Taylor. Although it saw mid-2024 annual inventory growth in excess of 15.5%, its occupancy rate is among the highest in Austin and its rent decline was among its lowest.
The CHIPS and Science Act Creates a Unique Opportunity
Investments like these should be on the radar of multifamily investors, not just by virtue of their size but also because they are so tightly targeted that they can move the economic needle. The transformational value of these projects, however, exceeds their price tag and the jobs they produce. When Intel arrived in 1980, Chandler had a population of 30,000. Today, it is a major U.S. hub for semiconductors with a population of 280,000—and Intel is still making a difference.
In 2023, for instance, Intel contributed $3.8 billion to Arizona-based businesses—and the added tax revenue generated so far during the construction of the new Ocotillo fabs has provided a substantial boost for Chandler municipal coffers. It allowed Chandler to pay off its public safety pension debt earlier than expected and maintain the low property and sales taxes the city is known for. In 2023, Intel and the Intel Foundation invested $2.2 million in Arizona education initiatives, funded 21 nonprofit-led water restoration projects, and, along with Intel employees, made $6.7 million in charitable contributions to Arizona-based organizations.
It is hard to imagine Chandler without Intel. And in 20 years, it may be impossible to imagine Taylor, with a current population of 16,000, without Samsung. Although tracking federal investments may not be on the radar screens of many multifamily investors, the consequence of the CHIPS Act—in Syracuse, Columbus, Phoenix, and Austin, as well as other areas of the country—are worthy of further investigation. When communities are on the verge of change, opportunities are at their maximum—and the CHIPS Act is changing communities.
