Tuesday, June 26, 2012

Multifam permits keep growing in Denver while they surge in Broomfield

Year-to-date through May of 2012, more than two-thirds of all new multifamily permits issued have been issued in Denver, Broomfield and Douglas counties alone. 

According to new multifamily permit data for Colorado counties, 3,052 multifamily permits have been issued from January through May of 2012. 2,056 of them, or 67 percent, were issued in Denver, Broomfield and Douglas counties. Adding in El Paso and Boulder counties brings the total to 2,720, or 89 percent, of all multifamily permits through May.

Few other counties issued many multifamily permits as of May of this year.

May's numbers significantly shift the landscape of multifamily permits in the state. Broomfield County had not been notable for its multifamily permits for most of 2012 through April, but 427 new multifamily permits were issued during May alone, bringing Broomfield's 2012 multifamily permit total to 573 for the year. Only Denver county has issued more multifamily permits so far this year. 

Total multifamily permits issued, Jan-May 2012
Adams 220
Arapahoe 49
Boulder 327
Denver 948
Douglas 535
El Paso 337
Jefferson 8
Larimer 50
Mesa 0
Pueblo 0
Weld 5

With so little demand for new condominiums right now, it is safe to assume that the lopsided majority of new multifamily permits being issued are for rental housing. We see most of this activity in areas where vacancy rates have been tight or look to be tight for the near to mid-term.

With apartment vacancy rates headed below five percent in the metro Denver area, the markets appear to be responding to tight vacancies with plans for future construction. Larimer county has also been a very active county for new multifamily activity over the past 18 months, although 2012 is a moderate year for Larimer county so far.

Change since 2011

Some counties saw very large increases in the number of multifamily permits issued. From January-May of 2011 to the same period this year, in Douglas County, multifamily permits increased more than 5,000% from 10 to 535, while in Adams county they increased from 0 to 220. Boulder County also saw a big increase with a rise in multifamily permits from 0 to 327, year over year through May, and Broomfield saw the largest increase from 0 multifamily permits to 573 permits, year over year through May. 

There was no multifamily permit activity at all in Pueblo County over the period, and Weld County increased only slightly from 0 to 5.