Why we strategically focus on the lower tax regimes, business-friendly states and local government policy, and growing populations in Arizona, Colorado, Nevada, Texas, Utah, and Idaho
What to know:
- The Greater Southwest region of the U.S. includes Arizona, Colorado, Nevada, Texas, Utah, and Idaho
- These six states support a disproportionate amount of the country’s fastest-growing cities
- Business-friendly tax and government policies make the Greater Southwest an especially promising source for investment opportunities
- In particular, the Greater Southwest region ranks highly in ease of starting and building small businesses
Just because it’s a cliche doesn’t mean it’s not true: the three most important things in real estate are location, location, and location. Real estate investors – whether single-family, multi-family, commercial, or other property types – make location a critical consideration in deploying capital. A successful investment strategy considers more than proximity to shopping and good schools.
Evaluating the American Greater Southwest
The Greater Southwest incorporates a wide geographic area, including Arizona, Colorado, Nevada, Texas, Utah, and Idaho. These six states bridge the continental divide and have become increasingly popular landing spots for people fleeing high-tax states like California. These states have also become beacons of hope for residents of the Rust Belt seeking greater economic opportunities.
In fact, the six states of the Greater Southwest boast four of the top five and six of top 10 fastest-growing states since 2010. Each state has seen population growth over 15% in the past 13 years, with Utah experiencing a staggering 24% population boom.
Fastest-growing US States
(2010-2023)
| RANK | STATE | GROWTH |
| 1 | Utah | 24% |
| 2 | Idaho | 23% |
| 3 | Texas | 21% |
| 4 | North Dakota | 19% |
| 5 | Nevada | 19% |
| 6 | Colorado | 19% |
| 7 | Washington | 19% |
| 8 | Florida | 19% |
| 9 | Arizona | 15% |
| 10 | South Carolina | 14% |
The importance of the population flooding into the Greater Southwest is matched only by the quality of the workforce joining the region. In a recent ranking of America’s Top States for Business, the six states of the Greater Southwest region all ranked in the top 20, including four of the top 10, of skilled workers in science, technology, engineering, and math (STEM) as well as college-educated workers.
This influx of new residents drives housing demand and dynamic economic activity, both of which appeal to real estate investors. But the economic opportunity only matters if the business environment can support such dynamic population growth.
The Greater Southwest Enjoys an Extremely Favorable Business Environment
The Greater Southwest delivers more than great weather, open spaces, and relatively affordable homeownership opportunities. It also boasts some of the most business-friendly states in the nation. The Chief Executive recently surveyed their readership and announced Texas as the best state for business, with Arizona, Utah, Nevada and Idaho also appearing in the top 10. Colorado rounded out the region at number 13.
In particular, CEOs in the survey noted Greater Southwest’s appeal as a refuge from recent anti-business policies in California.
Job growth in the region confirms the opinions of the CEOs. Nevada, Texas, Utah, and Idaho all rank highly in job growth over the past year, according to the Bureau of Labor Statistics. Many of those jobs power America’s critical economic engine: small businesses.
Small Businesses in Particular Thrive in the Greater Southwest
Small- and medium-sized businesses (SMBs) provide a unique and powerful driver of economic growth in the United States. The Greater Southwest fosters a positive environment for entrepreneurship and small business development.
The region rated highly in Thumbtack’s recent small business survey. In particular, all six Greater Southwest states scored above-average in employment, labor, and hiring. Idaho, Nevada, and Arizona all earned A+ grades for ease of starting a business. The region’s major population centers also scored highly in friendliness of tax code for SMBs.
Cities in the Greater Southwest with SMB-friendly Tax Codes
| Boise, ID | B |
| Denver, CO | B |
| Phoenix, AZ | B |
| Dallas, TX | A+ |
| Houston, TX | A+ |
The Motley Fool recently evaluated all 50 states on critical factors in small business success including tax climate, consumer spending, rate of entrepreneurship, business survival rate, labor costs, and climate. The Greater Southwest also excelled in this comprehensive study. All six states in the region ranked in the top third, with Texas, Idaho, Utah, and Arizona all ranking in the top 10 of best states for SMBs.
Real estate investors should consider a business-friendly environment mandatory when looking for opportunities. A special emphasis on nurturing small businesses will provide a steady stream of deal-flow as well as well-diversified opportunities.
The Surging Population Growth and Business Development Makes Private Equity Real Estate an Enticing Investment Opportunity Differences Between Note Offerings and Preferred Equity
As the Greater Southwest region continues to grow in population and economic opportunities, real estate investors may keep a sharp eye for asset classes likely to lead the pack, including:
- Residential Housing: With individuals drawn to the region at a blistering pace, investors should identify prime locations for single-family and multi-family residential housing. Through meticulous market analysis and a deep understanding of buyer preferences, investors can create the environment for thriving communities and housing options for the growing population.
Click here to learn more about our multi-family housing assets.
- Retail, Entertainment, and Hospitality: High foot traffic and the demand for retail and entertainment options in the Greater Southwest continues to grow. By developing vibrant retail centers, entertainment complexes, and mixed-use developments, investors can capitalize on the region’s appeal and economic vitality. Additionally, a surge in tourism and business travel offers opportunities for strategic investments in hotels and other hospitality.
Click here to learn more about Caliber’s Core+ Growth and Income Fund.
- Healthcare: Understanding the importance of quality healthcare facilities, investments in the development of cutting-edge medical centers help meet the burgeoning needs of a growing population.
Click here to learn more about Caliber’s healthcare assets, and/or click here to learn more about Caliber’s hotel assets.
Caliber – We are Middle-Market Private Equity Real Estate Experts in the Greater Southwest
In the realm of private equity real estate in the Greater Southwest, Caliber stands as a beacon of expertise and innovation. As “The Wealth Development Company,” we bring a wealth of experience, a track record of excellence, and a commitment to our clients’ success.
From our humble beginnings in the crucible of the 2009 financial crisis, we have emerged as leaders in alternative asset management, specializing in commercial real estate. Our dedication to delivering outsized returns through middle-market investments, our vertically integrated operating model, and our unwavering focus on growth markets set us apart.
Caliber’s investment offerings cater to a diverse range of objectives, whether it’s growth, income, or a hybrid of both. Our track record of over $2.9 billion in assets under management and development, $700 million in equity raised, and a 15-year history of cycle-tested operations, speaks volumes about our commitment to excellence.
With four distinct investment strategies, an unwavering investment thesis, and a belief that income creates value and reduces risk, Caliber offers more than just financial services; we offer a strategic partnership for your investment journey.
When you choose Caliber, you’re not just choosing a financial partner; you’re choosing a trusted guide to navigate the complexities of private equity real estate. Together, we can help your clients achieve their financial goals, strengthen their portfolios, and rise above market challenges.
About CaliberCos Inc.
Caliber (NASDAQ: CWD) is an alternative asset management firm whose purpose is to build generational wealth for investors seeking to access opportunities in real estate. Caliber differentiates itself by creating, managing, and servicing proprietary products, including middle-market investment funds, private syndiCaliber (NASDAQ: CWD) is an alternative asset management firm whose purpose is to build generational wealth for investors seeking to access opportunities in real estate. Caliber differentiates itself by creating, managing, and servicing proprietary products, including middle-market investment funds, private syndications, and direct investments, which are managed by our in-house asset services group. The Company leverages access to both the public and private markets to maximize value for its customers and funds. Our funds include investment vehicles focused primarily on real estate, private equity, and debt facilities. Additional information can be found at Caliberco.com and CaliberFunds.co.
Investor Considerations
The information contained herein is general in nature and is not intended, and should not be construed, as accounting, financial, investment, legal, or tax advice, or opinion, in each instance provided by Caliber or any of its affiliates, agents, or representatives. The reader is cautioned that this material may not be applicable to, or suitable for, the reader’s specific circumstances, desires, needs, and requires consideration of all applicable facts and circumstances. The reader understands and acknowledges that, prior to taking any action relating to this material, the reader (i) has been encouraged to rely upon the advice of the reader’s accounting, financial, investment, legal, and tax advisers with respect to the accounting, financial, investment, legal, tax, and other considerations relating to this material, (ii) is not relying upon Caliber or any of its affiliates, agents, employees, managers, members, or representatives for accounting, financial, investment, legal, tax, or business advice, and (iii) has sought independent accounting, financial, investment, legal, tax, and business advice relating to this material. Caliber, and each of its affiliates, agents, employees, managers, members, and representatives assumes no obligation to inform the reader of any change in the law or other factors that could affect the information contained herein.
493-CAL-083123