2016 End of Year Economic Update

Transcription

1 BROOMFIELD Economic Development End of Year Economic Update RELEASED: MARCH 2017 Provided by: Broomfield Economic Development One Descombes Drive Broomfield, CO Prepared by: Development Research Partners, Inc West Belleview Ave, Ste 100 Littleton, Colorado

2 Economic Dashboard BUSINESSES EMPLOYMENT LABOR FORCE UNEMPLOYMENT 2,652 Up 3.8% from 2Q 37,190 Up 3.5% from 2Q 36,032 Up 3.8% from 4Q 2.7% Down 0.1 percentage points from 4Q CONSUMER CONFIDENCE RETAIL SALES Up 7.8% from 4Q $720.0MM Down 3.5% from 4Q Units Down 69.3% from 4Q RESIDENTIAL BUILDING PERMITS OFFICE VACANCY 8.9% Up 1.2 percentage points from 4Q INDUSTRIAL VACANCY 2.5% Down 1.4 percentage points from 4Q RETAIL VACANCY 11.5% Down 1.4 percentage points from 4Q 2 End of Year Economic Report

3 End of Year Overview Economic indicators for the City and County of Broomfield show the economy recorded strong trends in. Broomfield recorded 6 percent employment growth during the first quarter of over-the-year, the highest rate since the third quarter of 2013, followed by 3.5 percent growth in the second quarter of. The average weekly wage for Broomfield workers increased by 2.6 percent between the second quarter of and, representing an additional $1,929 of wages per year for the average worker. The unemployment rate in Broomfield averaged 3.0 percent in, recording a decrease of 0.4 percentage points from. Broomfield s labor force increased by 2.8 percent, adding 971 people employed or looking for work. Consumer activity was mixed, with consumer confidence in the Mountain Region declining 5.5 percent in. Sales tax collections in Broomfield revealed that retail activity increased 6.7 percent in as the city collected $3.4 million more in than in. Home sales activity in Broomfield reported a shift in housing demand between and. Sales of single-family detached homes fell 4.5 percent and single-family attached home sales decreased 11.4 percent over-the-year, reflecting limited inventory in both product types. The average sales price for both markets improved, adding $30,150 to the average sales price of single-family detached homes and $29,020 to the average sales price for single-family attached homes. The apartment vacancy rate fell 0.8 percentage points between the fourth quarters of and to 5.4 percent and the average rental rate fell 6.4 percent over-the-year to $1,431 per month. The commercial real estate market reported mixed trends between the fourth quarters of and. Total existing square footage for all categories increased 2.5 percent, and vacancy rates for Class C office, industrial, and retail declined. The average lease rate for the industrial and retail markets rose by 16 percent and 43.7 percent, respectively, while the average lease rate for the three office space types reported mixed trends. ECONOMIC HEADLINES Enhance Broomfield, a program developed in to provide funding assistance to business and commercial building owners, is continuing in Approximately $165,000 has been allocated to the program this year, allowing applicants to receive $25,000 to improve existing commercial/industrial buildings or centers. Since June, 14 projects have been funded totaling $236,000 in awards, leveraging more than $463,000 of private sector funding. Forbes ranked Denver the best place for business and careers for the second year in a row. The company ranked the 200 largest metropolitan statistical areas (MSAs) based on 14 criteria including job growth, costs, income growth, quality of life, and education of the labor force. The company stated that Denver s relatively central location makes it a natural location as a distribution hub for the American West, while also supporting a number of growing industries in technology and communications. The company also stated that the city s nationally recognized museums, the second largest performing arts complex in the nation, and bustling neighborhoods are strong attributes of the city. Forbes released the 11th annual Best States for Business list measuring states with the best business climates that are poised to succeed going forward. Colorado claimed the fifth place ranking while Utah held the top spot. Forbes utilized 40 metrics from 17 sources across six broad categories including business costs, labor supply, regulatory environment, economic climate, growth prospects, and quality of life. The Milken Institute s Best-Performing Cities Index named two Colorado metropolitan areas among the top-25. The Fort Collins MSA ranked eighth, up six spots from last year, and the Denver-Aurora-Lakewood MSA ranked 13th, up three spots from last year. The index ranked 381 U.S. metro areas based on nine separate components including job growth and earnings. The Fort Collins MSA ranked 16th for job growth from 2014 to and fifth for wage growth from 2013 to The Denver-Aurora-Lakewood MSA ranked 10th for wage growth from 2013 to 2014, and 16th in both job growth and the number of high-tech industries. The Milken Institute released their annual State Technology and Science Index and reported that Colorado was the second-best tech state. The survey is conducted every two years to track and evaluate every state s tech and science capabilities and their success at converting these assets into companies and high-paying jobs. Colorado rose from fourth place in the previous survey, with a jump from sixth to first in human capital investment. The company stated that with 14 public and 17 private universities, Colorado is training a high-skill workforce attractive to tech companies. End of Year Economic Report 3

4 End of Year Overview Three Colorado cities were ranked among the best places to live by Money Magazine. Highlands Ranch ranked the highest at sixth, followed by Centennial (#13) and Broomfield (#25). The magazine ranked cities based on 60 criteria including economic opportunity, taxes, affordable housing, education, and crime. Highlands Ranch was recognized for its low crime and top-notch schools, Centennial was recognized for its strong job market, and Broomfield was noted for its location in the Metro Denver region. Apartment List, a San Francisco-based rental listing company, analyzed 510 U.S. cities to rank them for family-friendliness. The company used four metrics to rank the cities, which were safety, housing affordability, education quality, and child friendliness. Centennial received the highest rating in the state for the second year in a row, ranking 49th, followed by Broomfield (73), Thornton (110), Arvada (227), Boulder (289), Lakewood (346), Denver (351), Westminster (354), and Aurora (355). A proposed Adams 12 bond passed allocating $350 million to future school renovations and construction for the district. A large portion of the bond will go towards the construction of a new PreK-8 school in the Anthem area of Broomfield to combat current district overcrowding. If the bond had not passed, there would have been nearly 100 jobs lost in the district due to funding issues. The new school is projected to open in Colorado s ski area visitation in November and December started out slow compared to, but was 3 percent above the five-year average for the early season. As conditions improved late into December, many ski resorts saw record visitation. Broomfield-based Vail Resorts recorded a 13 percent decline in the early season, but traffic picked up during the holidays. Season-to-date lift ticket revenue at Vail Resorts ski areas was up 4.3 percent through the first week of January compared with the same period last season. EMPLOYMENT ACTIVITY Partners Group Holding AG, a Switzerland-based company, is building their North American headquarters in Broomfield. The global private markets investment manager that invests in private equity, real estate, infrastructure, and debt markets made the decision based on growing business in the U.S. The company will be building three separate structures amounting to 80,000 square feet. The Broomfield campus will employ roughly 200 employees to start, with a projected 800 employees after further expansions. The facility will be completed by Simpro Software, an Australian-based company, plans to open an American headquarters in Broomfield that could employ up to 100 people within two to three years. The company makes an operational software suite for contractors such as electricians and plumbers that help them manage a variety of tasks. The company raised $30.54 million to set up its operations. SpotXchange Inc., a tech firm that provides an online video advertising platform, will move its headquarters from Westminster to Broomfield in May The company leased 38,730 square feet of Class A office space at 8181 Arista Place to accommodate its growing workforce and product offerings. JP Morgan Chase is planning a 150,000-square-foot operations center in Broomfield, with construction anticipated to begin in the second quarter of 2017, and be completed by January The operation center will add an estimated 30 new full-time jobs and the company announced they will invest $200 million in personal property investment. Code42 opened a new office in Broomfield to hire the best talent and continue the company s quest to deliver ongoing innovation to its clients. The endpoint data security and recovery company plans to utilize Metro Denver s reputation as a technology hub and center for a highly skilled workforce. Broomfield-based Renewable Energy Systems Americas is collaborating with Southern Power to develop 10 wind power projects across the U.S. The 10 projects will produce an estimate 3,000 megawatts of energy and should be in operation between 2018 and Southern Power has signed agreements with both Siemens and Vestas to provide the windturbine equipment for the 10 projects. Broadcom Ltd. agreed to buy Brocade Communications that employs about 600 people in Broomfield. Brocade employs about 5,950 people globally. The $5.9 billion deal is expected to close in mid Broadcom is the third-largest semiconductor manufacturer in the nation by revenue. 4 End of Year Economic Report

5 End of Year Overview Broomfield-based Forge Nano, a company that makes nano-coating technology for lithium-ion battery components, announced it will relocate from Broomfield to a new 12,000-square-foot facility in Louisville following $20 million of Series A funding aimed to help the company ramp up production. The move and financing will increase production from 30 tons per year to 300 tons per year. Forge Nano will also start on a 3,000-ton per year heavy commercial plant in 2017 Swedish-based IKEA has closed on a 123-acre parcel of land on the northwest corner of State Highway 7 and Interstate 25. The company plans on building its second regional store, although no set date has been announced on when the store will open. According to IKEA, the company reported 771 million store visits in, meaning on average each store had roughly 2.3 million visits. Threshold School, a new project-based private school, is expected to open in August depending on student recruitment. The school plans to enroll students from third to eighth grade, capping enrollment at 35 students for the first year. Instead of teachers, one to three facilitators will be hired for the upcoming school year, with hopes of building a school around the problems that students think are interesting, and how to solve them. NEW & EXPANDING COMPANIES

6 Business, Employment, and Wages BUSINESS Business counts in Broomfield increased by 3.8 percent between the second quarters of and, as shown in Table 1.1, adding 98 businesses for 2,652 total businesses. Ten of the 13 sectors recorded increases in business during the period. The mining and logging (-33.3 percent), retail trade (-0.8 percent), and the transportation, warehousing, and utilities sectors (-6.1 percent) all reported loss of businesses between the second quarters of and. The information sector recorded the largest percentage increase over-the-year, rising 20.4 percent to 65 total businesses, while the professional and business services sector recorded the smallest increase of 2.2 percent. The wholesale sector recorded no change during the period, staying steady at 222 businesses. Broomfield averaged 2,663 businesses in the first half of, a 5 percent increase from the first half of, with an additional 126 businesses. The mining and logging sector recorded the only loss of businesses between the first half of and the first half of, losing four businesses. Of the 12 sectors that recorded growth during the period, professional and business services recorded the largest absolute increase, creating 32 new businesses during the period. The information sector recorded the largest percentage increase between the first half of and the first half of, increasing 16.8 percent to 63 total businesses. Business counts in the transportation, warehousing, and utilities, retail trade, and government sectors were essentially unchanged. Table Businesses by Supersector for the City and County of Broomfield 2Q 2Q YR/YR % FIRST HALF FIRST HALF YR/YR % Total All Industries 2,554 2, % 2,537 2, % Private Sector Mining & Logging % % Construction % % Manufacturing % % Wholesale Trade % % Retail Trade % % Transportation and Warehousing % % Information % % Financial Activities % % Professional & Business Services % % Education & Health Services % % Leisure & Hospitality % % Other Services % % Government % % 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 (QCEW) AVERAGE WEEKLY WAGES Broomfield workers across all industries earned an average weekly wage of $1,491 in the second quarter of, as shown in Figure 1.2 on the next page, a 2.6 percent increase compared with the second quarter of average wage of $1,454 per week. This increase represented an additional $37 a week, adding $1,930 of wages per year for the average worker. The three highest wage earners by sector were mining and logging ($2,683), information ($2,382), and professional and business services ($2,192), with mining and logging posting the largest wage growth of the three sectors between the second quarter of and the second quarter of of 14.9 percent. The financial activities sector recorded the largest growth during the period, rising 34.4 percent to an average weekly wage of $1,945, up from $1,447. Seven sectors 6 End of Year Economic Report

7 Business, Employment, and Wages AVERAGE WEEKLY WAGES (CONTINUED) recorded declines in the average weekly wage during the period, ranging from transportation, warehousing, and utilities (-21.8 percent) to leisure and hospitality (-0.1 percent). as shown in Table 1.3. Information employees ($2,771) recorded the $1,000 Workers across all industries in $1,800 Broomfield recorded a slight decrease in wages from the first half of to the first half of of 0.1 percent, $1,600 $1,400 $1,200 $1,288 $1,415 $1,454 $1,437 $1,483 $1,491 highest wage in the first half of, but this was 7.6 percent below the $800 $600 average in the first half of. Five $400 other sectors recorded a decline over $200 the period, with the declines ranging from transportation, warehousing, $0 and utilities (10.7 percent) to leisure 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 and hospitality (-0.5 percent). The financial activities sector recorded Source: Colorado Department of Labor and Employment, Labor Market Information. Quarterly Census of Employment and Wages (QCEW). the largest growth (17 percent) of any sector over-the-year, increasing weekly wages by $261 per week or $13,550 a year. Table Average Weekly Wage by Supersector for the City and County of Broomfield 2Q 2Q YR/YR % FIRST HALF FIRST HALF YR/YR % Total All Industries $1,454 $1, % $1,618 $1, % Private Sector Figure 1.2 $2,000 Average Weekly Wage (All Industries) $1,790 $1,744 Mining & Logging $2,335 $2, % $2,488 $2, % Construction $1,305 $1, % $1,413 $1, % Manufacturing $1,784 $1, % $2,140 $2, % Wholesale Trade $1,729 $1, % $1,813 $1, % Retail Trade $504 $ % $496 $ % Transportation and Warehousing $1,055 $ % $1,071 $ % Information $2,466 $2, % $3,000 $2, % Financial Activities $1,447 $1, % $1,532 $1, % Professional & Business Services $2,060 $2, % $2,258 $2, % Education & Health Services $692 $ % $670 $ % Leisure & Hospitality $377 $ % $376 $ % Other Services $702 $ % $665 $ % Government $867 $ % $869 $ % 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 (QCEW) End of Year Economic Report 7

8 Business, Employment, and Wages EMPLOYMENT Employment in Broomfield increased 3.5 percent between the second quarter of and the second quarter of, as shown in Table 1.4, representing 1,261 additional jobs. The construction sector recorded the largest over-the-year percentage increase in employment, rising 15.4 percent and adding 203 jobs, while the retail trade sector (+0.7 percent) recorded the smallest increase. The leisure and hospitality sector recorded the largest absolute change in employment over the period, adding 253 jobs between the second quarters of and. Two out of the 13 sectors recorded declines in employment over the period, with mining and logging (-9.4 percent) losing six jobs and financial activities (-2.8 percent) losing 60 positions over-the-year. Figure 1.5 shows quarterly employment in Broomfield from second quarter to second quarter. Employment in Broomfield increased 4.7 percent between the first half of and the first half of, representing 1,652 additional jobs. Financial activities (+13.5 percent), wholesale trade (+11.2 percent), and construction (+10.9 percent) all recorded double-digit growth over the period, adding 531 jobs combined over-the-year. The leisure and hospitality sector recorded the largest absolute change in employment, adding 270 jobs over-the-year, a 7.8 percent increase. Only one out of the 13 supersectors recorded declines in employment between the first half of and the first half of, with mining and logging losing one employee. Retail trade recorded the smallest over-the-year percentage increase, rising 0.2 percent, followed by the professional and business services sector, rising 2.3 percent. The Metro Denver area recorded steady employment growth between the first half of and the first half of, rising 2.8 percent to over 1.56 million jobs. Metro Denver generated an additional 42,417 jobs over-the-year. The largest absolute increases in employment were in the leisure and hospitality (+4.5 percent) and the education and health services supersectors (+3.7 percent), creating 7,408 jobs and 7,291 jobs, respectively. The construction sector recorded the largest percentage increase in employment during the period, rising 6.2 percent. The transportation, warehousing and utilities sector recorded the smallest employment increase over-the-year, rising 1.4 percent, while the mining and logging sector (-15.2 percent) recorded the only decline in employment during the period. Table Employment by Supersector CITY AND COUNTY OF BROOMFIELD 2Q 2Q YR/YR % METRO DENVER 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) FIRST HALF FIRST HALF YR/YR % FIRST HALF FIRST HALF YR/YR % Total All Industries 35,929 37, % 34,995 36, % 1,518,008 1,560, % Private Sector Mining & Logging % % 14,897 12, Construction 1,320 1, % 1,322 1, % 84,384 89, % Manufacturing 4,942 5, % 4,908 5, % 84,583 85, % Wholesale Trade 1,294 1, % 1,292 1, % 74,763 76, % Retail Trade 4,539 4, % 4,534 4, % 148, , % Transportation and Warehousing % % 51,292 52, % Information 3,923 4, % 3,717 3, % 53,176 54, % Financial Activities 2,130 2, % 1,802 2, % 104, , % Professional & Business Services Education & Health Services 9,351 9, % 9,183 9, % 280, , % 2,348 2, % 2,379 2, % 194, , % Leisure & Hospitality 3,580 3, % 3,445 3, % 165, , % Other Services % % 46,264 48, % Government 1,496 1, % 1,441 1, % 214, , % 8 End of Year Economic Report

9 Business, Employment, and Wages EMPLOYMENT (CONTINUED) Figure ,500 37,000 36,500 36,000 35,500 35,000 34,500 34,000 33,500 33,000 32,500 32,000 34,927 34,936 Broomfield Employment (All Industries) 34,061 35,929 36,362 36,564 36,103 37,190 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 Source: Colorado Department of Labor and Employment, Labor Market Information. Quarterly Census of Employment and Wages (QCEW). LABOR FORCE AND UNEMPLOYMENT Broomfield had a labor force of 36,032 people in the fourth quarter of, as shown in Figure 1.6, a 3.8 percent increase compared with the previous year s level of 34,697. Broomfield s labor force represented 2.1 percent of Metro Denver labor force during the period. There were an additional 1,335 people employed or looking for a job between the fourth quarters of and. The unemployment rate of 2.7 percent in the fourth quarter of was 0.1 percentage points lower than the previous year s level and 1.8 percentage points lower than the national average. This was the lowest recorded unemployment rate for Broomfield since 4Q 2000 when the rate was 2.2 percent. Of the seven Metro Denver counties, the City and County of Broomfield recorded the fourth lowest unemployment rate along with Arapahoe County. Labor Force Figure ,000 36,000 35,000 34,000 33,000 32,000 31,000 30,000 Broomfield Labor Force & Unemployment Rate Labor Force Quarter Unemployment Rate 36, % 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Source: Colorado Department of Labor and Employment, Labor Market Information; U.S. Bureau of Labor Statistics. Unemployment Rate The labor force in Broomfield increased 2.8 percent in compared with, as shown in Table 1.7 on the next page, representing an additional 971 people employed or looking for work. The labor force in Broomfield maintained a 2.1 End of Year Economic Report 9

10 Business, Employment, and Wages LABOR FORCE AND UNEMPLOYMENT (CONTINUED) percent representation of Metro Denver s total work force. The unemployment rate during averaged 3 percent, a decline of 0.4 percentage points from the average. The Broomfield unemployment rate was 0.1 percentage points below the Metro Denver level and 1.9 percentage points lower than the U.S. average in. The labor force in Metro Denver increased by 58,150 people in the fourth quarter of, a 3.5 percent increase from the year prior. The nearly 1.71 million people employed or looking for work in the Metro Denver area represented about 59% of Colorado s total labor force in the same period. Metro Denver s unemployment rate decreased by 0.3 percentage points between the fourth quarters of and to 2.7 percent, 1.8 percentage points lower than the national average, and 0.2 points lower than Colorado. The Colorado labor force increased 2.8 percent between the fourth quarter of and to nearly 2.91 million workers. The unemployment rate in Colorado declined 0.4 percentage point s over-the-year to 2.9 percent. The national labor force increased 1.3 percent in the fourth quarter of to over 159 million workers. The unemployment rate in the U.S. declined 0.3 percentage points between the fourth quarters of and to 4.5 percent, the lowest second quarter rate since the second quarter of 2007 when the rate was 4.4 percent. Table Labor Force and Unemployment by Area LABOR FORCE UNEMPLOYMENT RATE 4Q 4Q YR/YR % ANNUAL ANNUAL YR/YR % 4Q 4Q ANNUAL ANNUAL Broomfield 34,697 36, % 34,673 35, % 2.8% 2.7% 3.4% 3.0% Metro Denver 1,649,826 1,707, % 1,649,882 1,691, % 3.0% 2.7% 3.6% 3.1% Colorado 2,829,329 2,909, % 2,828,529 2,892, % 3.3% 2.9% 3.9% 3.3% U.S. (000 s) 157, , % 157, , % 4.8% 4.5% 5.3% 4.9% Source: Colorado Department of Labor and Employment, Labor Marketing Information; U.S. Bureau of Labor Statistics Figure 1.8 Unemployment Rate Broomfield Metro Denver Colorado U.S. Unemployment Rate 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 Quarter 4.5% 2.9% 2.7% 2.7% Source: Colorado Department of Labor and Employment, Labor Market Information; U.S. Bureau of Labor Statistics. 10 End of Year Economic Report

11 Consumer Activity CONSUMER CONFIDENCE The Conference Board s National Consumer Confidence Index showed increasing confidence between the fourth quarters of and, as shown in Figure 2.1. The U.S. index rose 12.3 percent over-the-year to and was up 7.1 percent from the previous quarter. The index averaged 99.8 in, a 1.9 percent increase over the average. The Mountain Region index, which includes Colorado, also reported increases in consumer confidence between the fourth quarters of and. The mountain region index was in the fourth quarter of, up 7.8 percent from the prior year s level of The fourth quarter level was 8.7 percent above the previous quarter s level. However, the index fell 5.5 percent to an average of in compared with in. RETAIL SALES Figure = Consumer Confidence Index Mountain U.S. Source: The Conference Board. Total retail sales for Broomfield reached $720 million in the fourth quarter of, as shown in Table 2.2, a decrease of 3.5 percent from the previous year s level of $745.8 million. This decrease represented $25.8 million less in retail sales. The fourth quarter decline in retail sales marked the first over-the-year decline in fourth quarter retail sales since the fourth quarter of 2011 when sales fell 7.1 percent. Of the seven Metro Denver counties, Broomfield recorded the third smallest decline in retail sales between the fourth quarters of 2014 and. Table Total Retail Sales in Metro Denver by County METRO DENVER TOTAL RETAIL SALES ($000S) 4Q 4Q 2014 YR/YR % ANNUAL 2014 ANNUAL YR/YR % Adams $6,010,676 $5,682, % $23,168,485 $21,438, % Arapahoe 6,063,664 $5,777, % $21,192,360 $21,515, % Boulder 3,137,873 $3,036, % $10,370,313 $10,405, % Broomfield $745,793 $720, % $2,410,900 2,456, % Denver $8,003,170 $7,750, % $27,479,112 $28,190, % Douglas 2,343,368 2,661, % $8,409,964 $9,825, % Jefferson $4,580,990 $4,592, % $16,630,191 $17,097, % Metro Denver $30,885,534 $30,221, % $109,661,325 $110,928, % Source: Colorado Department of Revenue Total retail sales for Broomfield reached nearly $2.5 billion in, an increase of 1.9 percent from the previous year s level of $2.4 billion. This increase represented an additional $45 million in retail sales. In, Broomfield recorded the fourth largest increase in retail sales of the seven Metro Denver counties. Retail sales in the City and County of Broomfield represented about 2.2 percent of total retail sales in Metro Denver in. End of Year Economic Report 11

12 Consumer Activity RETAIL SALES (CONTINUED) Retail sales in Metro Denver were $30.2 billion in the fourth quarter of, a 2.2 percent decline in sales compared with the previous year s level of $30.9 million. This decrease represented $664 million less in retail sales. The fourth quarter of decline in retail sales marked the first over-the-year decline in fourth quarter retail sales for Metro Denver since the fourth quarter of 2009 when sales fell 5.2 percent. Douglas and Jefferson counties recorded the only over-the-year increases in retail sales, rising 13.6 percent and 0.3 percent, respectively. Metro Denver retail sales reached nearly $111 billion in, an increase of 1.2 percent from the previous year s level of $109.7 billion. This increase represented an additional $1.3 billion in retail sales. Six of the seven Metro Denver counties recorded increases in sales between 2014 and, ranging from 0.3 percent in Boulder County to 16.8 percent in Douglas County. Adams County recorded the only over-the-year decline, falling 7.5 percent to $21.4 million. SALES TAX COLLECTIONS Sales tax collections in Broomfield were 8.6 percent higher during the fourth quarter of than the fourth quarter of. The fourth quarter of collection level was also 18.6 percent higher than the previous quarter s level. Sales tax collections in Broomfield reached nearly $15.8 million in the fourth quarter of, as shown in Figure 2.3, representing an additional $1.3 million in sales tax compared with the previous year, and the highest reported amount since data going back to the first quarter of Sales tax collections were nearly $54.7 million in, up 6.7 percent from the previous year s level of $51.3 million. Broomfield collected an additional $3.4 million in sales tax between and. (Note: The two data points, Total Retail Sales and Sales Tax Collections, do not necessarily reflect the same tax base, so trends may differ.) HOTEL AND LODGING According to the Rocky Mountain Lodging Report, the Highway 36 corridor recorded an average occupancy rate of 74.4 percent in, as shown in Figure 2.4. This rate was 0.4 percentage points higher than the prior year s occupancy rate. The average room rate for the Highway 36 corridor market was $ per night in, a 5.6 percent increase from the previous year ($ per night). The average occupancy rate in Metro Denver decreased to 75 percent in, down from 75.9 percent in, and the average room rate rose 5.1 percent over-the-year to $ Figure 2.3 Average Room Rate Sales Tax Receipts (Millions) $18 $16 $14 $12 $10 $8 $6 $4 $2 $0 Figure 2.4 $145 $135 $125 $115 $105 $95 $85 $75 $65 $55 $45 Sales Tax Receipts Q 2Q 3Q 4Q Hotel & Lodging Indicators for the Highway 36 Corridor Average Daily Room Rate Quarter Source: The City and County of Broomfield, Finance Department Occupancy Rate 100% 80% 60% 40% 20% Source: Colorado Hotel and Lodging Association, Rocky Mountain Lodging Report. 0% Average Occupancy Rate 12 End of Year Economic Report

13 Real Estate EXISTING HOME SALES Existing home sales in the Broomfield single-family detached market fell between the fourth quarters of and, as shown in Table 3.1, reflecting the limited inventory of homes available for purchase. Broomfield reported a 2.1 percent decline in single-family detached home sales over-the-year, falling from 237 sales in the fourth quarter of to 232 sales in the fourth quarter of. The average sales price for a single-family detached home was $412,162 in the fourth quarter of, an increase of 5.3 percent compared with the prior year. The average sales price for Broomfield was $15,603 below the Metro Denver average during the fourth quarter of. Broomfield recorded 1,024 single-family detached home sales during, a decrease of 4.5 percent compared with. This represented 48 fewer homes sold over-the-year. The average sales price for a single-family detached home was $423,731 in, an increase of 7.7 percent compared with the previous year. The Broomfield average sales price was $8,320 below the Metro Denver average. The Metro Denver single-family detached market recorded similar trends in home sales as Broomfield between the fourth quarters of and. Metro Denver recorded 10,934 single-family detached home sales in the fourth quarter of, a 3.8 percent decrease in sales compared with the fourth quarter of level of 10,535 sales. The average sales price for a single-family detached home was $427,765 in the fourth quarter of, an increase of 8.2 percent compared with the fourth quarter of price. Metro Denver reported 44,711 sales in the single-family detached market in, a decrease of 0.5 percent compared with the prior year. This represented 226 fewer homes sold between and. The average sales price for a single-family detached home in Metro Denver was $432,051 in, an increase of 9 percent compared with the previous year. Table Existing Single-Family Detached Home Sales Home Sales 4Q 4Q % ANNUAL ANNUAL % Broomfield % 1,072 1, % Metro Denver 10,535 10, % 44,937 44, % Average Sold Price Broomfield $391,399 $412, % $393,582 $423, % Metro Denver $395,295 $427, % $396,508 $432, % Source: Colorado Comps, LLC Sales of single-family attached homes recorded a different trend than the single-family detached home market, reflecting a shift in demand for more affordable housing that single-family attached homes offer. Existing home sales in the Broomfield single-family attached market increased by 16.7 percent between the fourth quarters of and, increasing from 24 sales to 28 sales, respectively. The average sales price for a single-family attached home was $295,100 in the fourth quarter of, an increase of 12.6 percent compared with the prior year. The average sales price for Broomfield was $30,371 above the Metro Denver average during the fourth quarter of. Broomfield recorded 132 single-family attached home sales during, a decrease of 11.4 percent, reflecting the limited inventory of homes for purchase. The average sales price for a single-family attached home was $276,948 in, an increase of 11.7 percent compared with the previous year. The Broomfield average sales price was $23,247 above the Metro Denver average. The Metro Denver single-family attached market recorded significantly different trends in home sales as Broomfield between the fourth quarters of and. Metro Denver recorded 3,821 single-family attached home sales in the fourth quarter of, a 0.4 percent decrease in sales compared with the fourth quarter of level of 3,838 sales. The average sales price for a single-family attached home was $264,729 in the fourth quarter of, an increase of 13.4 percent compared with the fourth quarter of price. Metro Denver reported 15,578 sales in the single-family attached market in, a decrease of 5.3 percent compared with the prior year. This represented 875 fewer homes sold between and. The average sales price for a single-family attached home in Metro Denver was $253,700 in, an increase of 11.1 percent compared with the previous year. End of Year Economic Report 13

14 EXISTING HOME SALES (CONTINUED) Table Exising Single-Family Attached Home Sales Home Sales Real Estate 4Q 4Q % ANNUAL ANNUAL % Broomfield % % Metro Denver 3,838 3, % 16,453 15, % Average Sold Price Broomfield $261,121 $295, % $247,931 $276, % Metro Denver $233,465 $264, % $228,422 $253, % APARTMENTS Broomfield reported an apartment vacancy rate of 5.4 percent during the fourth quarter of, as shown in Figure 3.3, which was 0.8 percentage points below the fourth quarter of level (6.2 percent). However, the vacancy rate was 0.3 percentage points above the previous quarter s level. The Metro Denver vacancy rate fell 0.6 percentage points between the fourth quarters of and to 6.2 percent. Of the six market areas in Metro Denver, the Boulder/Broomfield submarket recorded the second lowest vacancy rate during the fourth quarter of. Broomfield reported an average lease rate of $1,431 per month during the fourth quarter of, which was 6.4 percent lower than the fourth quarter of level ($1,529 per month). Source: Colorado Comps, LLC The average lease rate in Metro Denver was $1,347 per month in the fourth quarter of, rising 4.3 percent from the fourth quarter of rate of $1,292 per month. The Broomfield average lease rate was 6.3 percent above the Metro Denver level in the fourth quarter of. Of the six market areas in Metro Denver, the Boulder/Broomfield submarket recorded the highest average lease rate during the fourth quarter of. Table Average Apartment Rents and Vacancy Figure 3.3 Vacancy Rate 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2Q 2013 VACANCY RATE Broomfield vs. Metro Denver Apartment Vacancy AVERAGE APARTMENT RENT 4Q 4Q 4Q 4Q % Broomfield 6.2% 5.4% $1,529 $1, % Metro Denver 6.8% 6.2% $1,292 $1, % 3Q Q Q 2014 Broomfield 4Q Q 2Q Quarter Metro Denver 3Q 4Q 1Q Source: Denver Metro Apartment Vacancy and Rent Survey 2Q 3Q 4Q Source: Denver Metro Apartment Vacancy and Rent Survey 14 End of Year Economic Report

15 BUILDING PERMITS Broomfield issued permits for 102 new single-family detached units during the fourth quarter of, as shown in Table 3.5, representing a 27.5 percent increase from the fourth quarter of (80). The average valuation for single-family detached homes was $345,978 in the fourth quarter of, which was 3.1 percent below the previous year s level of $357,218. This represented a drop of $11,240 in average valuation over-the-year. Broomfield issued building permits for 14 new single-family attached units during the fourth quarter of, representing a 133 percent increase from the fourth quarter of level (6 units). The average valuation for single-family attached homes was $204,007, 4.4 percent below the previous year s level of $213,403. The average valuation for units in the market was $9,396 lower over-theyear. Permits for 479 single-family detached homes were issued during, an increase of 24.4 percent compared with the previous year s level of 385. The average valuation of single-family detached homes in declined 1.7 percent to $346,062 compared to. There were 67 permits issued for single-family attached units in, which was essentially the same as the 68 units permitted in. The average valuation of single-family attached units increased by 21.8 percent to $193,776, up from the previous year s level of $159,140. There were 216 apartment and condominiums units permitted in, a decline of 26 percent from last year s level of 292 units. Metro Denver issued 7,626 permits in the fourth quarter of, representing a 45.3 percent increase over the same quarter the prior year. Metro Denver issued permits for 2,686 single-family detached units, 55 single-family attached units, and 4,885 multi-family units. The single-family detached market recorded a 17 percent increase in permits and the single-family attached market rose 25 percent over-the-year, while the multi-family market recorded a 68 percent increase in permits during the period. There were 23,027 units permitted in Metro Denver during, an increase of 21.9 percent compared with the previous year s level (18,885 units). Single-family attached units increased 5 percent over-the-year, rising to 422 units in. Single-family detached units in Metro Denver rose from 9,832 units in to 10,772 units, an increase of 9.6 percent. The multi-family market recorded the largest increase in total units, rising 36.8 percent over-the-year to 11,833 units in. Table Broomfield Residential Building Permits Real Estate 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 80 $357,218 6 $213, $92, Q 102 $345, $204, Yr/Yr % Change 27.5% -3.1% 133.3% -4.4% % Annual 385 $352, $159, $92, Annual 479 $346, $193, $105, Yr/Yr % Change 24.4% -1.7% -1.5% 21.8% -42.9% -26.0% 13.4% 2.3% Source: The City and County of Broomfield, Building Division End of Year Economic Report 15

16 Real Estate OFFICE MARKET The Broomfield office market had over 6.5 million square feet of space during the fourth quarter of. The three office types reported mixed trends during the fourth quarter of compared with the prior year. The vacancy rate for Class A office space increased 2 percentage points between the fourth quarters of and to 10.5 percent vacancy, as shown in Table 3.5 on the next page. The average lease rate of Class A space was $28.39 per square foot, a decrease of 1.6 percent over-the-year. Class B office space recorded a 0.5 percentage point increase in vacancy, and a 6.2 percent increase in the average lease rate to $24.79 per square foot during the period. The vacancy rate for Class C space fell 2.4 percentage points over-the-year to 2.6 percent and the average lease rate fell 13.5 percent to $15.32 per square foot during the same period. The Metro Denver office market also recorded mixed trends in vacancy rates and average lease rates between the fourth quarters of and. The vacancy rate for Class A office space rose 0.4 percentage points over-the-year to 10.1 percent vacancy and the average lease rate increased 1 percent to $30.41 per square foot. This average lease rate was $2.02 per square foot more than the Broomfield rate. Class B office space recorded a vacancy rate of 10 percent, 0.6 percentage points lower than the previous year, and the average lease rate rose 5 percent to $22.56 per square foot during the period. Class C space in Metro Denver reported a 0.6 percentage point decline in the vacancy rate over-theyear to 4.2 percent and a 7.6 percent increase in the average lease rate. INDUSTRIAL MARKET The Broomfield industrial market consisted of over 3.6 million square feet of space during the fourth quarter of, as shown in Table 3.5 on the next page. The industrial market recorded a vacancy rate of 2.5 percent during the fourth quarter of, a 1.4 percentage point decline compared with the fourth quarter of. The average lease rate for the industrial market was $6.80 per square foot, an increase of 16 percent over-the-year. The Broomfield average lease rate was $0.61 per square foot lower than the Metro Denver average lease rate during the period. The Metro Denver industrial market had nearly 211 million square feet of space during the fourth quarter of. The industrial market vacancy rate rose 0.7 percentage points between the fourth quarters of and to 3.8 percent. This was 1.3 percentage points higher than the Broomfield vacancy rate during the period. The average lease rate for industrial space in Metro Denver was $7.41 per square foot during the fourth quarter of, an increase of 5.4 percent compared with the previous year s level. RETAIL MARKET The retail market in Broomfield had nearly 4.8 million square feet of space during the fourth quarter of, as shown in Table 3.5 on the next page, representing 2.9 percent of retail space in Metro Denver. The retail market vacancy rate was 11.5 percent during the fourth quarter of, a 1.4 percentage point decrease in vacancy compared with the previous year s level. The Broomfield vacancy rate was 7 percentage points higher than the Metro Denver vacancy rate during the period. The average lease rate for the retail market in Broomfield rose 43.7 percent over-the-year to $16.77 per square foot. The retail market in Metro Denver consisted of nearly 165 million square feet of space during the fourth quarter of, an increase of 0.8 percent over the previous year s level. The retail vacancy rate fell 0.5 percentage points between the fourth quarters of and to 4.5 percent. The average lease rate for retail space in Metro Denver was $16.55 per square foot during the period, an increase of 3.4 percent over-the-year. The average lease rate for retail space in Metro Denver was $0.22 per square foot lower than the Broomfield level during the fourth quarter of. 16 End of Year Economic Report

17 Real Estate Table Broomfield Real Estate Markets 4Q- Office Broomfield TOTAL EXISTING SQUARE FOOTAGE VACANCY RATES AVERAGE LEASE RATE (PER SQ. FOOT) 4Q 4Q 4Q 4Q 4Q 4Q Class A 3,068,913 3,171, % 10.5% $28.84 $28.39 Class B 3,163,749 3,174, % 7.6% $23.34 $24.79 Class C 178, , % 2.6% $17.72 $15.32 Metro Denver Class A 63,156,108 63,960, % 10.1% $30.11 $30.41 Class B 94,275,993 94,836, % 10.0% $21.48 $22.56 Class C 21,570,561 21,570, % 4.2% $17.28 $18.59 Industrial Broomfield 3,413,728 3,624, % 2.5% $5.86 $6.80 Metro Denver 206,176, ,685, % 3.8% $7.03 $7.41 Retail Broomfield 4,730,551 4,766, % 11.5% $11.67 $16.77 Metro Denver 163,591, ,909, % 4.5% $16.00 $16.55 COMMERCIAL BUILDING PERMITS Source: CoStar, Inc. There were nine commercial real estate permits issued during the second half of, as shown in Table 3.6, representing 381,680 square feet of space. The Fairfield and Residence Inn was the most expensive of the projects valued at $16.3 million. The Atria Arista Apartment buildings were the second highest-valued projects, with a valuation of $5.3 million each. The smallest project by square footage was Starbucks Core & Shell, spanning 2,150 square feet and valued at $821,000. Table Commercial Real Estate Permits, Second Half PROJECT DESCRIPTION VALUATION TOTAL SQUARE FOOTAGE Fairfield & Residence Inn $16,329, ,083 Atria - Building 1 $5,295,080 88,294 Atria - Building 2 $5,295,080 88,294 Vista Pointe Core and Shell $1,976,500 25,824 7-Eleven $1,127,500 2,958 Starbucks Core & Shell $821,000 2,150 Auto Zone $600,000 7,147 Broomfield Professional Campus Building $158,000 19,994 Source: The City and County of Broomfield, Building Division. End of Year Economic Report 17

18 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 March 2017