2015 End of Year Economic Update

Transcription

1 BROOMFIELD Economic Development 2015 End of Year Economic Update RELEASED: FEBRUARY 2016 Provided by: Broomfield Economic Development One Descombes Drive Broomfield, CO Prepared by: Development Research Partners, Inc West Belleview Ave, Ste 100 Littleton, Colorado

2 2015 End of Year Overview The City and County of Broomfield continued to record positive economic indicators through the second half of 2015, with growth in employment, consumer activity, and the commercial real estate market. Total employment in Broomfield rose 4.8 percent between the second quarters of 2014 and 2015, representing the addition of 1,630 jobs during the period. The unemployment rate fell to 2.9 percent in the fourth quarter of 2015, recording the lowest fourth quarter unemployment level since the fourth quarter of 2000 when the rate was 2.2 percent. Consumer activity in Broomfield during the first quarter of 2015 increased, with total retail sales rising 3.7 percent compared with the previous year s level. Businesses in Broomfield recorded an additional $19 million in retail sales during the period. Consumer confidence in the Mountain Region rose 13.8 percent between the fourth quarters of 2014 and Home sales activity recorded mixed trends between the fourth quarters of 2014 and 2015 in Broomfield. The single-family detached market recorded a 4.4 percent increase in home sales over-the-year, while the single-family attached market recorded a 29.4 percent decrease. The apartment vacancy rate fell from 10.7 percent in the fourth quarter 2014 to 6.2 percent in the fourth quarter of The commercial real estate market also reported mixed trends during the fourth quarter. The two of the three classes of office space reported declining vacancy along with the industrial market, while the retail market reported rising vacancy. ECONOMIC HEADLINES Zillow ranked Denver the hottest housing market of The company stated Denver has a healthy mix of home price appreciation, low unemployment, and a tech industry focus. The company ranked cities based on criteria including home price appreciation, jobless rate, and income growth. Seattle, Wash. was ranked second followed by Dallas-Fort Worth, Texas, Richmond, Va., and Boise, Idaho. Forbes released a list of the easiest and hardest cities to find a job and Denver ranked as the third easiest city to find a job. The company used job-listing data from Indeed.com to rank the cities. The report stated that Denver has 96 jobs posted for every 1,000 residents. San Jose, Calif. was ranked the easiest city to find a job and Raleigh. N.C. ranked second, while Miami, Fla. and Los Angeles, Calif. were ranked the hardest cities to find a job. The Denver-Aurora-Lakewood MSA was ranked the fourth best city for young entrepreneurs by NerdWallet. The company analyzed 181 MSAs in the United States and ranked each metro area based on criteria including small business financing, local business environment, and local economy. NerdWallet reported that 40.8 percent of the Denver-Aurora-Lakewood MSA residents had a bachelor s degree or higher and that the region received $14.6 million in small business loans per 100,000 residents. WalletHub ranked the Denver-Aurora-Lakewood metropolitan statistical area (MSA) as the fourth best market for science, technology, engineering, and mathematics (STEM) professionals. The company ranked the 100 largest metropolitan areas in the country based on criteria including STEM-employment growth, research and development spending, tech startup density, and housing affordability. The San Jose-Sunnyvale-Santa Clara, Calif. MSA ranked first followed by the Austin-Round Rock, Texas MSA and the Seattle-Tacoma-Bellevue, Wash. MSA. JLL Technology Office Outlook released a list of emerging technology centers in the United States, ranking Denver fourth and Boulder sixth. The company compiled the list based on criteria including tech economic momentum, talent pool, startup friendliness, and market factors. San Francisco ranked first followed by Washington, DC, New York City, and Chicago. The company reported that the access to skilled tech employees was a high mark for both Denver and Boulder. ECONOMIC ACTIVITY Camden Partners, a Baltimore-based private equity firm, completed a buyout of Proposal Software Inc., a Colorado software company. The company will move from its Boulder location to a new headquarters in Broomfield. Nuventra Pharma Sciences opened an office in Broomfield as part of the company s expansion into industry hotspots. The company provides consulting services for companies in the pharmacology, pharmacokinetic and pharmacometric spaces as they work their way through clinical trials. The company plans to start out with a team of five employees with the possibility of expansion in the future. Level 3 Communications Inc. announced plans to reduce its workforce by 500 to 700 people. The employment reduction will be worldwide, but a proportionate number of the layoffs will be local. VMware Inc., a Palo Alto, Calif-based software visualization firm, cut its labor force by 800 employees, with 38 workers being in Broomfield. The company stated the employment cuts were due to restructuring and realignment End of Year Economic Report

3 Economic Dashboard BUSINESSES EMPLOYMENT LABOR FORCE UNEMPLOYMENT 2,550 Up 9.1% from 2Q ,929 Up 4.8% from 2Q ,700 Down 0.2% from 4Q % Down.6 percentage points from 4Q 2014 CONSUMER CONFIDENCE RETAIL SALES Up 13.8 % from 4Q 2014 $530.8MM Up 3.7% from 1Q Units Up 404% from 4Q 2014 RESIDENTIAL BUILDING PERMITS OFFICE VACANCY 7.8% Down 3.3 percentage points from 4Q 2014 INDUSTRIAL VACANCY 4.5% Down 1.8 percentage points from 4Q 2014 RETAIL VACANCY 12.7% Up 0.3 percentage points from 4Q End of Year Economic Report 3

4 Business, Employment, and Wages BUSINESS The City and County of Broomfield had over 2,550 businesses during the second quarter of 2015, as shown in Table 1.1, an increase of 9.1 percent from the previous year. The area welcomed an additional 213 businesses between the second quarters of 2014 and All 13 sectors recorded growth in businesses over-the-year. About one-third of businesses in the City and County of Broomfield are in the professional and business services supersector, as shown in Table 1.2, which reported an 11.1 percent increase in total businesses over-the-year. The mining and logging and transportation and warehousing sectors also reported significant growth during the period, rising 71.4 percent and 32 percent, respectively. The retail trade (+0.4 percent) and the leisure and hospitality (+3.9 percent) sectors reported the smallest over-the-year growth in businesses. Table Business and Employment Indicators by Supersector QUARTERLY BUSINESS COUNT CITY AND COUNTY OF BROOMFIELD AVERAGE WEEKLY WAGE QUARTERLY EMPLOYMENT LEVEL METRO DENVER QUARTERLY EMPLOYMENT LEVEL 2Q15 2Q14 2Q15 2Q14 2Q15 2Q14 2Q15 2Q14 Total All Industries 2,554 2,341 $1,454 $1,276 35,929 34,295 1,511,877 1,479,558 Private Sector Mining & Logging 12 7 $2,335 $5, ,998 14,713 Construction $1,305 $1,149 1,320 1,360 86,463 81,201 Manufacturing $1,784 $1,721 4,942 4,796 85,183 82,102 Wholesale Trade $1,729 $1,921 1,294 1,227 75,058 72,598 Retail Trade $504 $480 4,539 4, , ,082 Transportation and Warehousing $1,055 $1, ,983 49,709 Information $2,466 $1,754 $3,923 3,593 53,469 52,778 Financial Activities $1,447 $1,390 2,130 1, , ,007 Professional & Business Services $2,060 $1,714 9,351 9, , ,073 Education & Health Services $692 $704 2,348 2, , ,465 Leisure & Hospitality $377 $357 3,580 3, , ,334 Other Services $702 $ ,586 45,043 Government $867 $874 1,496 1, , ,174 Note: Industry data may not add to all-industry total due to rounding, suppressed data, and employment that cannot be assigned to an industry. Source: Colorado Department of Labor and Employment, Labor Marketing Information. Quarterly Census of Employment and Wages (QECW) Table Changes in Number of Businesses in Broomfield s Top Supersectors 2Q15 1Q15 2Q14 % OF TOTAL QUAR- TERLY CHANGE YEARLY CHANGE ANNUAL CHANGE Total All Industries 2,554 2,520 2, % 9.1% 213 Professional & Business Services % 1.8% 11.1% 83 Retail Trade % 0.0% 0.4% 1 Financial Activities % 1.1% 9.5% 23 Education & Health Services % 0.4% 9.8% 20 Wholesale Trade % -0.4% 8.8% End of Year Economic Report

5 Business, Employment, and Wages WAGES Workers across all industries in Broomfield earned an average weekly wage of $1,454 during the second quarter of 2015, as shown in Figure 1.3, an increase of 13.9 percent compared with the second quarter of This increase represented an additional $178 in earnings per week. Information employees earned the highest wage ($2,466) during the second quarter of 2014 and reported the largest increase over-the-year of 40.6 percent. The professional and business services supersector also reported significant growth (+20.1 percent) in wages during the period. The wholesale trade, transportation and warehousing, education and health services, and government sectors also recorded overthe-year declines in wages. Workers in the retail trade sector and leisure and hospitality supersector earned the lowest wages of all 13 supersectors during the period. Figure 1.3 $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 $1,252 $1,367 Average Weekly Wage (All Industries) $1,689 $1,276 $1,288 $1,415 $1,790 $1,454 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 Source: Colorado Department of Labor and Employment, Labor Market Information. Quarterly Census of Employment and Wages (QCEW). EMPLOYMENT Employment in Broomfield increased 4.8 percent between the second quarters of 2014 and 2015, as shown in Figure 1.4 representing an additional 1,634 jobs. The financial activities supersector reported the largest overthe-year increase in employment, rising 49.1 percent or 701 additional jobs. The information sector generated the second-most number of jobs between the second quarters of 2014 and 2015, adding 330 positions. The professional and business services supersector, the largest supersector by employment, reported a 1.6 percent decline in employment, representing 154 fewer jobs. The retail trade and construction sectors also reported over-the-year declines in employment, falling 0.3 percent and 2.9 percent, respectively. Figure ,500 36,000 35,500 35,000 34,500 34,000 33,500 33,000 32,500 32,000 34,361 34,305 Broomfield Employment (All Industries) 33,556 34,295 34,927 34,936 34,061 35,929 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 Source: Colorado Department of Labor and Employment, Labor Market Information. Quarterly Census of Employment and Wages (QCEW). The Metro Denver area continued to record strong employment growth across all sectors, with overall employment rising 3.8 percent between the second quarters of 2014 and The construction sector reported the largest increase in employment during the period, rising 6.5 percent or 5,280 jobs. The information supersector recorded the smallest growth in employment over-the-year, increasing 1.3 percent over-the-year and adding 690 jobs End of Year Economic Report 5

6 Business, Employment, and Wages LABOR FORCE AND UNEMPLOYMENT The City and County of Broomfield had a labor force of 33,700 people during the fourth quarter of 2015, as shown in Figure 1.5, representing 2.1 percent of the total Metro Denver labor force. The labor force in Broomfield decreased 0.2 percent between the fourth quarters of 2014 and This represented 73 fewer people working or looking for a job. The unemployment rate in Broomfield fell 0.6 percentage points over-theyear to 2.9 percent in the fourth quarter of 2015, as shown in Figure 1.6. Broomfield recorded the third lowest unemployment rate of the seven Metro Denver counties during the period. Figure 1.5 Labor Force Participants 45,000 37,500 30,000 22,500 15,000 7,500 0 Broomfield Labor Force 33,827 33,778 33,625 33,775 33,844 33,705 3Q Q Q Q Q Q 2015 Quarter Source: Colorado Department of Labor and Employment, Labor Market Information; U.S. Bureau of Labor Statistics. The unemployment rate in Metro Denver fell to 3.1 percent during the fourth quarter of 2015, a decline of 0.8 percentage points over-the-year. The Metro Denver labor force decreased 0.6 percent during the period. The Colorado labor force decreased 0.5 percent and the unemployment rate fell 0.7 percentage points to 3.4 percent. The national unemployment rate fell to 4.8 percent, while the labor force rose 0.7 percent. Figure 1.6 Unemployment Rate Broomfield Metro Denver Colorado U.S. 7.0% Unemployment Rate 6.0% 5.0% 4.0% 3.0% 2.0% 4.8% 3.4% 3.1% 2.9% 1.0% 0.0% 3Q Q Q Q Q Q 2015 Quarter Source: Colorado Department of Labor and Employment, Labor Market Information; U.S. Bureau of Labor Statistics End of Year Economic Report

7 Consumer Activity CONSUMER CONFIDENCE The Conference Board s National Consumer Confidence Index reported increases through the fourth quarter of 2015, as shown in Figure 2.1, rising 3.5 percent over-the-year to 96 for the U.S. index. However, the U.S. index recorded a 2.3 percent decrease in consumer confidence between the third and fourth quarters of The fourth quarter 2015 level is the highest fourth quarter national consumer confidence level since the fourth quarter of 2006 when the index was at The Mountain Region index, which includes Colorado, also increased compared with the fourth quarter of The Mountain Region index rose to 104.3, an over-the-year increase of 13.8 percent. Similar to the national index, the mountain index also fell over-the-quarter, declining 10.8 percent. The mountain region continued to report record high levels of consumer confidence, signaling strong expectations for the local economy. Figure 2.1 Consumer Confidence Index Mountain U.S = RETAIL SALES Total retail sales for Broomfield reached over $530.8 million during the first quarter of 2015, as shown in Table 2.2. Broomfield recorded a 3.7 percent increase in retail sales over-the-year, representing an additional $19 million in retail sales. Of the seven Metro Denver counties, Broomfield recorded the fourth largest increase in retail sales between the first quarters of 2014 and Retail sales in Broomfield represented 2.1 percent of Metro Denver s retail sales during the quarter. Table 2.2 Source: The Conference Board. METRO DENVER TOTAL RETAIL SALES ($000S) 1Q Q 2014 YEAR OVER YEAR % CHANGE Adams $4,791,426 $5,273, % Arapahoe $5,053,164 $4,696, % Boulder $2,379,039 $2,224, % Broomfield $530,854 $511, % Denver $6,463,403 $6,014, % Metro Denver reported a 3.5 percent increase in Douglas $1,949,150 $1,884, % retail sales between the first quarters of 2014 and 2015, collecting an additional $846.6 million in retail Jefferson $4,010,572 $3,728, % sales. Six of the seven counties reported increases Metro Denver $25,177,608 $24,331, % in retail sales over-the-year. The City and County of Source: Colorado Department of Revenue Denver reported the largest increase in sales volume, collecting an additional $449.3 million. Arapahoe County recorded the largest percentage increase in retail sales during the period, increasing 7.6 percent End of Year Economic Report 7

8 SALES TAX COLLECTIONS Sales tax collections throughout Broomfield were 0.9 percent lower during the fourth quarter of 2015 than the fourth quarter of 2014, as shown in Figure 2.3. The fourth quarter collections level was 14.3 percent higher than the third quarter, with approximately $14.5 million in sales tax collections. Further, the 2015 annual collections total of nearly $51.3 million was 3.1 percent above the previous year. (Note: The two charts, Total Retail Sales and Sales Tax Collections, do not necessarily reflect the same tax base, so trends may differ.) $0 HOTEL AND LODGING 1Q 2Q 3Q 4Q According to the Rocky Mountain Quarter Lodging Report, the Highway 36 Source: The City and County of Broomfield, Finance Department corridor recorded an occupancy rate of 48.1 percent in December 2015, as shown in Figure 2.4. This rate was 4.1 percentage points lower than the prior year s occupancy rate. The average room rate for the Highway 36 corridor market was $ per night in December, a 2.6 percent increase from the previous year ($ per night). The occupancy rate averaged 75.9 percent in 2015, up slightly from 75.8 in The occupancy rate averaged 74 percent in 2015, down from 74.5 percent in The average occupancy rate in Metro Denver decreased to 55.5 percent in December, down from 58.3 percent in the same month last year, and the average room rate rose 5.3 percent to $ per night. Figure 2.4 Consumer Activity Figure 2.3 Sales Tax Receipts (Millions) $16 $14 $12 $10 $8 $6 $4 $2 Hotel and Lodging Indicators for the US 36 Corridor Average Daily Room Rate Sales Tax Receipts Occupancy Rate $ % Average Room Rate $120 $105 $90 $75 $60 $45 80% 60% 40% Average Occupancy Rate $30 20% $15 $- 0% Source: Colorado Hotel and Lodging Association,Rocky Mountain Lodging Report End of Year Economic Report

9 Real Estate EXISTING HOME SALES Existing home sales in the Broomfield single-family detached market increased between the fourth quarters of 2014 and 2015, as shown in Table 3.1. Broomfield recorded 237 sales in the single-family detached market, an increase of 4.4 percent over-the-year or 10 additional homes sold. The average sales price for a single-family detached home was $391,400, an increase of 4.8 percent over-the-year or an additional $18,060. Home sales in the single-family attached market fell 29.4 percent during the period, selling 10 fewer homes. The average sales price for a single-family attached home was $262,120 during the fourth quarter of 2015, an increase of 24.9 percent over-the-year or an additional $52,180. Of the seven Metro Denver counties, Broomfield recorded the fourth highest average sale price in the single-family detached market and the fourth highest average sale price in the single-family attached market. Existing homes sales in Metro Denver continued to improve during the fourth quarter of 2015 in both the single-family detached and single-family attached markets. Sales of single-family detached homes increased 2.3 percent between the fourth quarters of 2014 and 2015, while single-family attached home sales increased 2.2 percent. The average sales price of single-family detached homes in Metro Denver increased 8.9 percent over-the-year to $393,010, adding $32,040 to the average sales price. The average sales price of single-family attached homes rose 11.4 percent over-the-year to $230,260, adding $23,630 to the average sales price. Table 3.1 Home Sales Single-Family Detached METRO DENVER COUNTY MARKETS Adams Arapahoe Boulder Broomfield Denver Douglas Jefferson METRO DENVER TOTAL 4Q ,753 2, ,043 1,500 1,934 10,535 4Q ,619 1, ,232 1,325 1,988 10,296 Single-Family Attached 4Q , ,838 4Q , ,757 Average Sold Price Single Family Detached 4Q 2015 $289,961 $365,778 $528,538 $391,399 $420,614 $448,424 $388,657 $393,013 4Q 2014 $257,957 $330,870 $460,907 $373,343 $386,682 $425,008 $355,385 $360,972 Single-Family Attached 4Q 2015 $184,515 $195,727 $299,284 $262,121 $284,641 $290,307 $211,992 $230,259 4Q 2014 $175,090 $166,379 $278,421 $209,944 $253,710 $252,053 $173,483 $206,632 APARTMENTS Source: Colorado Comps The City and County of Broomfield reported a vacancy rate of 6.2 percent during the fourth quarter of 2015, as shown in Table 3.2 on the next page, a decrease of 4.5 percentage points compared with the prior year. However, the vacancy rate was 2.1 percentage points above the third quarter of 2015 level of 4.1 percent. The large over-the-year decline was due to a large number of new units coming on the market during the fourth quarter of The average rental rate rose 16.5 percent over-the-year, adding $216 per month to the rental rate. The average rental rate was also 4.8 percent higher than the previous quarter s level ($1,459). The Boulder/Broomfield sub-market is the most expensive sub-market in Metro Denver. The vacancy rate in Metro Denver was 6.8 percent during the fourth quarter of 2015, as shown in Figure 3.3, rising 2.1 percentage points above the previous year s level. The vacancy rate was also 1.8 percentage points higher than the third quarter of 2014 level of 5 percent. The average rental rate in Metro Denver rose 10.5 percent over-the-year, adding $123 per month to the rental rate. The average rental rate was unchanged from the previous quarter s level End of Year Economic Report 9

10 Real Estate Table 3.2 Vacancy Rate AVERAGE APARTMENT RENTS AND VACANCY, FOURTH QUARTER 2015 Efficiency 1 Bed 2 Bed, 1 bath 2 Bed, 2 bath 3 Bed Other All City and County of Broomfield 6.2% $1,167 $1,426 $1,384 $1,669 $1,974 $1,736 $1,529 Metro Denver 6.8% $1,061 $1,148 $1,218 $1,508 $1,808 $1,461 $1,292 Figure 3.3 Source: Denver Metro Apartment Vacancy and Rent Survey Broomfield vs. Metro Denver Apartment Vacancy Broomfield Metro Denver BUILDING PERMITS The City and County of Broomfield reported a 404 percent increase in the number of new residential units permitted between the fourth quarters of 2014 and 2015, as shown in Table 3.4. The single-family detached market recorded a 12.7 percent over-the-year increase, representing permits for nine additional units during the period. The average valuation for single-family detached homes fell 2.2 percent, representing $8,090 less in valuation over-the-year. The single-family attached market recorded improvements over-the-year, recording a 50 percent increase in permits or two additional units. The market also recorded a 62.3 percent increase in the average valuation, representing an additional $81,910. The City and County of Broomfield issued 14 apartment or condominium permits for 292 units during the fourth quarter of 2015, rising from the no permits issued during the fourth quarter of The average valuation for an apartment or condominium was $92,610 during the fourth quarter of Table 3.4 BROOMFIELD RESIDENTIAL BUILDING PERMITS SINGLE-FAMILY DETACHED SINGE-FAMILY ATTACHED APARTMENTS AND CONDOMINIUMS TOTAL Units Average Valuation Per Unit Units Average Valuation Per Unit Permits Units Average Valuation Per Unit UNITS 4Q $357,218 6 $213, $92, Q $365,305 4 $131, Yr/Yr % Change 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Q Q Q Q Q Q Q Q Q Q Q Source: Denver Metro Apartment Vacancy and Rent Survey 12.7% -2.2% 50.0% 62.3% % Source: The City and County of Broomfield, Building Division End of Year Economic Report

11 Real Estate Metro Denver recorded a 32.7 percent increase in new residential units permitted between the fourth quarters of 2014 and The increase was attributed to a 32.9 percent increase in single-family detached units and a 36.2 percent increase in multi-family units. The single-family attached market recorded a decrease in the number of units permitted over-the-year, falling 52.7 percent. There were 2,907 multi-family units, 2,296 single-family detached units, and 44 single-family attached units permitted during the fourth quarter of OFFICE MARKET The Broomfield office market had nearly 6.2 million square feet of space during the fourth quarter of The three office types reported mixed trends during the fourth quarter of 2015 compared with the prior year, as shown in Table 3.5. The vacancy rate for Class A office space fell 6 percentage points between the fourth quarters of 2014 and 2015 to 7.8 percent vacancy. The average lease rate of Class A space was $28.65 per square foot, a decrease of 3.5 percent over-theyear. Class B office space recorded a 2.7 percentage point decline in vacancy and a 0.7 percent increase in the average lease rate during the period. The vacancy rate for Class C space rose 2.4 percentage points over-the-year, but the average lease rate rose 2.4 percent during the same period. Table 3.5 Office Broomfield The Metro Denver office market recorded declining vacancy rates and rising average lease rates between the fourth quarters of 2014 and The vacancy rate for Class A office space fell 0.6 percentage points over-the-year to 9.6 percent vacancy and the average lease rate rose 2.9 percent to $29.74 per square foot. This average lease rate was $1.09 per square foot more than the Broomfield rate. Class B office space recorded a vacancy rate of 10.2 percent, 1.1 percentage points lower than the previous year, and the average lease rate rose 7.3 percent during the period. Class C space in Metro Denver reported a 0.5 percentage point decline in the vacancy rate over-the-year and a 3.3 percent increase in the average lease rate. INDUSTRIAL MARKET BROOMFIELD OFFICE REAL ESTATE MARKETS 4Q 2015 TOTAL EXISTING SQUARE FOOTAGE VACANCY RATES AVERAGE LEASE RATE (PER SQ. FOOT) 4Q15 4Q14 4Q15 4Q14 4Q15 4Q14 Class A 3,068,923 3,068, % 13.8% $28.65 $29.69 Class B 2,924,018 2,924, % 9.0% $23.34 $23.18 Class C 192, , % 0.7% $17.72 $17.30 Metro Denver Class A 62,756,463 61,120, % 10.2% $29.74 $28.90 Class B 93,799,683 93,358, % 11.3% $21.61 $20.14 Class C 21,495,708 21,495, % 5.6% $17.01 $16.46 Source: CoStar, Inc. The Broomfield industrial market consisted of nearly 3.5 million square feet of space during the fourth quarter of The industrial market recorded a vacancy rate of 4.5 percent during the fourth quarter of 2015, as shown in Table 3.6 on the next page, a 1.8 percentage point decline compared with the fourth quarter of The average lease rate for the industrial market was $6.25 per square foot, an increase of 17 percent over-the-year. The Broomfield average lease rate was $0.79 per square foot lower than the Metro Denver average lease rate during the period. The Metro Denver industrial market had over 206 million square feet of space during the fourth quarter of The industrial market vacancy rate rose 0.1 percentage points between the fourth quarters of 2014 and 2015 to 3.2 percent. This was 1.3 percentage points lower than the Broomfield vacancy rate during the period. The average lease rate for industrial space in Metro Denver was $7.04 per square foot during the fourth quarter of 2015, an increase of 17.1 percent compared with the previous year s level End of Year Economic Report 11

12 Real Estate RETAIL MARKET The retail market in Broomfield had over 4.7 million square feet of space during the fourth quarter of 2015, representing less than 3 percent of space in Metro Denver. The retail market vacancy rate was 12.7 percent during the fourth quarter of 2015, as shown in Table 3.7, a 0.3 percentage point increase in vacancy compared with the previous year s level. The Broomfield vacancy rate was 7.7 percentage points higher than the Metro Denver vacancy rate during the period. The average lease rate for the retail market in Broomfield fell 10.6 percent over-the-year to $11.67 per square foot. The retail market in Metro Denver consisted of nearly 162 million square feet of space during the fourth quarter of 2015, an increase of 0.7 percent over the previous year s level. The retail vacancy rate fell 0.2 percentage points between the fourth quarters of 2014 and 2015 to 5 percent. The average lease rate for retail space in Metro Denver was $16 per square foot during the period, an increase of 1.7 percent over-the-year. The average lease rate for retail space in Metro Denver was $4.33 per square foot higher than the Broomfield level during the fourth quarter of COMMERCIAL BUILDING PERMITS There were four commercial real estate permits issued during the second half of 2015, representing 41,337 square feet of space, as shown in Table 3.8. The Skyestone Rec Center is valued at $2.6 million, the most expensive of the projects, and is located in the Skyestone residential housing development. The building will include a fully equipped modern fitness center, recreational pool with two lap lanes, soothing spa, outdoor pickle ball courts, library, meeting space, and demonstration kitchen. The Goodwill Retail Store and Donation Center is valued at over $1.4 million and spans 19,974 square feet, the largest building permitted by square footage. Table 3.8 Table 3.6 Industrial BROOMFIELD INDUSTRIAL REAL ESTATE MARKETS 4Q 2015 TOTAL EXISTING SQUARE FOOTAGE VACANCY RATES COMMERCIAL REAL ESTATE PERMITS, 4Q 2015 AVERAGE LEASE RATE (PER SQ. FOOT) 4Q15 4Q14 4Q15 4Q14 4Q15 4Q14 Broomfield 3,493,634 3,493, % 6.3% $6.25 $5.34 Metro Denver 206,008, ,634, % 3.1% $7.04 $6.01 Table 3.7 Retail BROOMFIELD RETAIL REAL ESTATE MARKETS 4Q 2015 TOTAL EXISTING SQUARE FOOTAGE VACANCY RATES Source: CoStar, Inc. AVERAGE LEASE RATE (PER SQ. FOOT) 4Q15 4Q14 4Q15 4Q14 4Q15 4Q14 Broomfield 4,754,606 4,751, % 12.4% $11.67 $13.05 Metro Denver 161,949, ,789, % 5.2% $16.00 $15.74 Source: CoStar, Inc. Project Description Valuation Total Square Footage Skyestone Rec Center $2,615,678 8,603 Goodwill Retail Store & Donation Center $1,453,234 19,974 New Commercial Retail and Restaurant East Building $658,000 6,380 New Commercial Retail and Restaurant West Building $628,000 6,380 Totals $5,354,912 41,337 Source: The City and County of Broomfield, Building Division End of Year Economic Report

13 BROOMFIELD Economic Development Provided by: Broomfield Economic Development One Descombes Drive Broomfield, CO Prepared by: Development Research Partners, Inc West Belleview Ave, Ste 100 Littleton, Colorado February 2016