Tuesday, October 30, 2012

Almost half of multifamily permits this year have been issued in Denver

Year-to-date through September of 2012, 47 percent of all new multifamily permits issued have been issued in Denver county alone.

According to new multifamily permit data for Colorado counties, 6,453 multifamily permits have been issued from January through September of 2012. 3,075 of them, or 47 percent, were issued in Denver. Adding in Broomfield, Douglas, and El Paso Counties, we find that 76 percent of multifamily permits this year come from just those four counties.

Arapahoe, Boulder, and Larimer counties have also been active counties this year for multifmaily permits, and few other counties have reported many multifamily permits.

Downtown Denver and the northwest corridor of the metro area, which includes Broomfield, have reported significant rent growth in recent years, and developers appear to be capitalizing on high demand in those markets. El Paso County continues to build following a decade of very little building, while Douglas County has some of the few suburban markets seeing significant amounts of building right now.

Total multifamily permits issued, Jan-September 2012
Adams 220
Arapahoe 470
Boulder 349
Broomfield 668
Denver 3,075
Douglas 590
El Paso 597
Jefferson 40
Larimer 409
Mesa 7
Pueblo 0
Weld 28

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. The apartment vacancy rates in Colorado continued to decline into the third quarter, and this will lead to sustained demand for additional construction.

Change since 2011

Some counties saw very large increases in the number of multifamily permits issued. From January-September of 2011 to the same period this year, in Douglas County, multifamily permits increased more than 3,300% from 17 to 590, while in Adams county they increased from 0 to 220. Boulder County also saw a big increase (926%) with a rise in multifamily permits from 34 to 349, year over year through September, and Broomfield saw the largest increase from 0 multifamily permits to 668 permits, year over year through September.

There was no multifamily permit activity at all in Pueblo County over the period, and Weld County increased only slightly from 0 to 28.