STAYING OCCUPIED
ECON 17 LOOKED BACK AT 2016 ' S RECORD BREAKING YEAR , AND LOOKED TO 2017 WITH HIGH HOPES
By Ryan Gager , Hearn & Fleener , LLC
Photos courtesy of Victor Sanchez , imADgine Studios
An atmosphere of discussion , laughter and smiles filled the room at the 2017 Winter Economic Conference , as has been the case for several years . The conference once again drew hundreds to the Marriott Denver Tech Center , all buzzing about the growth the city has experienced . As the next round of downtown communities come online , the industry is focused on staying occupied in 2017 .
According to the Apartment Association of Metro Denver ’ s Vacancy and Rent Report , fourth quarter 2016 average rents decreased by $ 21 to $ 1,347 while the vacancy rate increased by 1.1 percent to 6.2 percent from last quarter . Teo Nicolais , conference chair , explained that fourth quarter numbers usually follow this same trend year over year . Apartments will continue to come online this year . Cary Bruteig , Principal , Apartment Appraisers and Consultants , confirmed that 10,000 to 11,000 new units are scheduled for completion in 2017 .
Looking back on 2016 , Tom Clark , CEO , Metro Denver Economic Corp ., said that last year was a great year for job growth as around 18,000 jobs were created in Denver . “ When you have a diverse economy and a great airport , you are going to have lots of different types of jobs ,” said Clark . A major change in energy also will drive employment in Colorado , as the United States became an oil exporter last year for the first time in 61 years . With the increase in jobs attracting more people to metro Denver each month , Clark sees some challenges on the horizon , especially with the transportation infrastructure . RTD ’ s FasTracks expanded with the opening of the A Line to the airport , but experienced setbacks on other lines , with completion pushed back from their original dates . How Denver ’ s highways progress , rising housing costs and lack of condos are the next big challenges as we head into 2017 according to Clark .
Chris Geer , CEO , H2 Capital , and Teo Nicolais explained the connection between rent growth and the real estate market cycle . The 30-year relationship between occupancy and rent growth indicates that the highest percentages of rent growth occurs when occupancy is between 94 and
Tom Clark |
Jeff Hawks |
Mark Monroe |
Ken Schroeppel |
16 | TRENDS • FEBRUARY 2017 www . aamdhq . org