Labor is the number one criterion: Data Centers require lower employment levels and have a high need of water, electric and internet. IT offices require well educated millennials. Call Centers employ second wage earners so minimum wage laws are high on their criteria list. Kathy was asked about our beautiful state of Colorado and if it fit the criteria but she said the newly passed minimum wage law has knocked our state off the desired relocation list based on the above industries’ criteria. Same applies with manufacturing companies. They want certainty in costs; strong pro-business government with low regulations plus incentives.
Why Incentives, she was asked? Incentives cannot make a bad deal good, but a good deal better! Making the long list is half the battle for a City/State. It helps keep things competitive and helps land a project/industry to an area. For large scale projects, incentives are essential. Best incentives: Upfront use of incentives and incentives that add to their bottom line. Colorado ranked HIGH on costs for payroll and graded LOW on incentives with the grades ranging between a C- and a D. Ouch, I never liked seeing that on my report card!
Other speakers included a “bike czar”, Ken Gart on industry, innovation and the great outdoors; Dr. Arlen Meyers on moving sick care to healthcare and how to overcome them and the Keynote speaker, Ben Collins of FOX News which were all interesting but again, my attendance, donation and time committed for this event was for any new idea on what I could do to attract buyers, tenants, developers to my small world in Delta County. Then they did breakout sessions with four topics to choose from. Being a commercial broker for over 30 years, naturally I went into the “Developing Real Estate for the Next Gen Consumer” panel lead by the summit’s lead sponsor, Coldwell Banker Commercial. My take away from this session which I felt was too short and could have gone on for twice the amount of allotted time was:
• Decreasing/shrinking office and retail space users. On-line purchasing (Amazon) has changed the need to house everything in retail spaces and office users are more mobile with better internet services
• Co-working spaces more appealing with amenities such as home within a home
• Office rates averaging $10.46 per sq.ft.; CAP rates averaging 8.22% for office investments; residential median sales prices now at $215,000
• Active Adult Homes/Communities is the up and coming thing for the aging baby boomers
• For every 100 new single family homes it generates 396 new jobs!
Overall, it was a great summit, great venue, excellent food and informative topics. Maybe next year our local officials will send more representatives to represent our area.
Blog written by:
Lucinda Stanley, CCIM / Broker / Owner
Grand Mesa Commercial Real Estate