Things are not getting any better for Denver's economy or for the local apartment mar-
ket. Job losses remain high and the unemployment rate is steady, with little sign of immi-
nent recovery. Apartment vacancy rates keep rising, rental rates are falling and demand
is stagnant. At best, recovery in the Denver economy won't occur until mid-2003. With
job growth will come demand for housing. In the meanwhile, it's a time of anticipation
Charts and Graphs:
·
Distribution of apar t-
ment units by county
page 2
·
Vacancy, net absorption
and development trends
page 3
·
Monthly Average rent
page 4
·
Apartment Units Under
Construction
page 5
·
Apartment Units Pro-
posed
page 6
·
Addenda Tables
page 9
The American economy right now is acting like a four-cylinder car running on only two
cylinders. Stagnation is the best definition; no job growth, no increase in business ex-
penditures, weakness in retail sales and the potential for dislocations caused by a war in
Iraq. The for-sale housing market is the only bright spot, and the long-term viability of
that sector is also open to question if the economic malaise doesn't soon begin to de-
part.
Denver's economy has suffered along with the rest of the nation. Compared to the same
period in 2001, not exactly a boom year in any case, the total number of jobs in metro
Denver is down almost 27,000. The metro unemployment rate in September was 5.2%,
slightly above the Colorado rate of 5.0% but also slightly under the national 5.4% level.
However, during the twelve months ending in September Denver's job losses are the
equivalent of a 2% decline while the national employment base lost only 0.7%.
The metro economy may be bouncing along at the bottom of the recession but no seri-
ous signs of recovery are yet evident. Retail sales remain stagnant, actually down
slightly during the last twelve months. Without a significant recovery in the Denver econ-
omy the apartment market will continue to suffer. Quite simply stated, jobs equal hous-
ing demand.
Some of the major Denver economic events during the 3rd quarter of 2002 included:
·
The number of residential foreclosures in metro Denver rose by 54% during the
first half of 2002.
·
Time Warner cut 230 jobs at its northern Douglas County offices and will move
200 jobs from Denver to Charlotte.
·
Exabyte Corporation eliminated 170 jobs in Boulder.
·
Renaissance Mark, a maker of labels, selected Denver as its new headquarters,
(Continued on page 2)
Fourth Quarter 2002
Volume 1, 4
Overview
1
The Metro Denver Econ-
omy
1
The Metro Denver
Apartment Market
2
Apartment Develop-
ment Activity in Metro
Denver
5
Apartment Sales During
1st Qtr. 2002
7
Forecast 2002
8
Methodology
8
Addenda
9
Inside this issue:
The Apartment Perspective
News and Analysis about the
Denver Metropolitan Apartment Market
Fourth Quarter 2002
The Metro Denver Economy
Overview
James Real Estate Services, Inc.
