President, Development Research Partners
Transcript of President, Development Research Partners
Member FDICVectraBank.com
Patty SilversteinPresident, Development Research Partners
Metro Denver2015 Economic ForecastFebruary 2015
CHANGING FACES
Photo Credit TRIAS Telematica
2012 Economic Update for Metro Denver
Millennials are largest population group
0
10,000
20,000
30,000
40,000
50,000
60,000
0 3 6 9 12 15 18 21 24 27 30 33 36 39 42 45 48 51 54 57 60 63 66 69 72 75 78 81 84 87 90+
Metro Denver Population 2015 = 3.05 millionMillennials730,230
Gen X688,760
Baby Boomers681,110
Silent Gen208,100
Greatest Gen
25,670
Next Gen 719,920
Source: Colorado Division of Local Government, State Demography Office.
2012 Economic Update for Metro Denver
Millennials dominate potential labor force
0
10,000
20,000
30,000
40,000
50,000
60,0000 3 6 9 12 15 18 21 24 27 30 33 36 39 42 45 48 51 54 57 60 63 66 69 72 75 78 81 84 87 90+
Metro Denver Population 2025 = 3.54 millionMillennials839,710
Gen X702,570
Baby Boomers617,030
Silent Gen127,79
Future Gen 436,470
Next Gen 816,830
Source: Colorado Division of Local Government, State Demography Office.
2015 Economic Forecast for Metro Denver
Changing Workspaces
2015 Economic Forecast for Metro Denver
Changing Workspaces
Millennials are on track to be most educated generation in history. (Pew Research Center)
10% increase in contingent employment from 2011 to 2013, now 17.7 million in U.S. (MBO Partners)
Telecommuting rose 79% between 2005 and 2012, now 2.6% of workforce (American Community Survey)
1/2 to 2/3 of Millennials interested in entrepreneurship, and 27% already self-employed. (U.S. Chamber of Commerce Foundation)
2015 Economic Forecast for Metro Denver
Nonfarm Job Growth Rates
1.1%1.7% 1.9% 2.0%
0.8%
3.5% 3.2%3.0%
-6%
-4%
-2%
0%
2%
4%
6%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014e 2015f
United States Metro Denver
Metro Denver 2014 Employment = 1.5 million68K jobs lost 2009-10; 64K jobs added 2011-12; 96K jobs added 2013-14
Source: U.S. Bureau of Labor Statistics.
2015 Economic Forecast for Metro Denver
Proprietors are another significantcomponent of employment
592,421
792,999 816,308
837,048
500,000
550,000
600,000
650,000
700,000
750,000
800,000
850,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Source: U.S. Bureau of Economic Analysis.
Proprietors Employment25% of Colorado’s Total Employment (US avg = 22%)
2015 Economic Forecast for Metro Denver
Key Metro Denver Industry Clusters
Aerospace Aviation Bioscience
Medical Devices & Diagnostics Pharmaceuticals & Biotechnology
Broadcasting & Telecommunications
Energy Fossil Energy Cleantech
Financial Services Banking & Finance Investments Insurance
Healthcare & Wellness IT/Software
2015 Economic Forecast for Metro Denver
Metro Denver Industry Clusters2013-2014
2015 Economic Forecast for Metro Denver
Metro Denver Commercial Real Estate
Vacancy Rate (direct) Lease Rate4Q 2013 4Q 2014 4Q 2013 4Q 2014
Office 11.2% 10.0% $22.06 $22.87
Industrial 3.9% 3.0% $5.07 $6.10
Retail 6.0% 5.6% $15.40 $15.47
Source: CoStar Realty Information, Inc.
2015 Economic Forecast for Metro Denver
Metro Denver Construction Activity(as of 4Q 2014)
Office: 1.2 MSF completed; 2.8 MSF under construction
Industrial: 2.6 MSF completed; 1.4 MSF under construction
Retail: 0.6 MSF completed; 0.9 MSF under construction
Infrastructure
FasTracks: West, East, Gold, I-225, North Metro, U.S. 36 BRT DIA: Westin Hotel, Public Transit Center, C Concourse expansion I-70 from DIA to Eagle County Airport??
2015 Economic Forecast for Metro Denver
Changing Places
2015 Economic Forecast for Metro Denver
Changing Places
Student loan debt more than tripled in past decade, to more than $1.1 trillion. While Fannie- and Freddie-backed borrowers have an average score of 740, most Millennials have credit scores below 700. (Source: FICO)
In 2012, 36% of the nation’s Millennials were living in their parents’ home. This is the highest share in at least four decades. (Source: Pew Research Center)
Younger buyers tend to buy older homes, and are more likely to buy previously owned homes. Most often they do so because the home is a better price and better overall value. (Source: National Association of Realtors)
2015 Economic Forecast for Metro Denver
Consistent sales activity expected
53,48253,106
50,244 49,78947,837
42,07038,81839,387
45,203
53,643 53,71254,000
25,000
30,000
35,000
40,000
45,000
50,000
55,000
60,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015fSources: Metrolist, Inc.; Denver Metro Association of Realtors.
Metro Denver Existing Home Sales Closed
2015 Economic Forecast for Metro Denver
Metro Denver ranks in top 20for median home price
$195$166
$197 $207 $216
$239$219
$281$307 $325
$0
$50
$100
$150
$200
$250
$300
$350
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014e 2015f
United States
Source: National Association of REALTORS.
Median Home Prices (in thousands)
2015 Economic Forecast for Metro Denver
Strong demand for higher density options
Source: Denver Metro Apartment Vacancy & Rent Survey.
9.7%
8.2%7.0%
6.2%6.6%
8.1%
5.9%5.2% 4.7% 4.6% 4.6%
0%
2%
4%
6%
8%
10%
12%
14%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Metro Denver Apartment Vacancy Rate
2015 Economic Forecast for Metro Denver
Multi-family currently representsabout half of new construction
0
5,000
10,000
15,000
20,000
25,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014e 2015f
Multi-Family (5+ units)
* The Census Bureau tracks building permits by the number of housing units in the structure.Source: U.S. Census Bureau, Building Permits.
Metro Denver Building Permits*
2015 Economic Forecast for Metro Denver
Thank You!
Development Research Partners10184 West Belleview Avenue, Suite 100
Littleton, Colorado 80127(303) 991-0070
www.DevelopmentResearch.net
Patricia Silverstein, [email protected]