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Frontier will locate a $40 million aircraft maintenance hangar in Colorado Springs, with plans to hire 200 immediately and 350 over the next two years.  Frontier is also expected to begin scheduled flights to the city.

The U.S. Olympic Committee is considering relocating its headquarters from Colorado Springs if it can’t find appropriate office space.  Economist David Bamberger reports that his 1998 study showed that spending by Olympic and related sports organization brought $315 million and 4,800 jobs to the community.

Finance: 

Venture capital investment in Colorado fell 14.1% to $196.6 million in the third quarter relative to a year ago, but was up 13.4% from the second quarter.  There were 24 deals, with 31% of the dollars invested going to three biotechnology companies.

Payday loans in the state increased over 28% in 2006, to $633 million, after rising 34% in 2005.   The average payday loan was for $351 for 18.5 days and carried an average rate of 329%.  There were 290,000 borrowers.  Payday lenders can charge up to 392%.  In addition to payday loans, licensed small installment lenders loaned $15 million to 15,354 residents, up 59%.  Both types of loans are categorized as subprime, a category covering loans with rates above 12%.  Supervised loans, made by finance companies, insurance premium companies and certain mortgage lenders, increased rose 17.6% to $2.2 billion.

Cost-of-living:

The cost-of-living in Denver in the second quarter was 3.7% above the national average.  At the end of the technology boom in 2000, living costs in Denver were 10.4% above the nation.  Grand Junction was also more expensive than the U.S. average by 0.3%.

 

Cost of Living – 2007:2

Colorado Springs	94.0
Denver	103.7
Fort Collins	94.2
Grand Junction	100.3
Greeley	98.1
Pueblo	87.0

  Source:  ACCRA COLI.

Tourism: 

Colorado’s hotel occupancy rate averaged 70.5% in September, up from 67.8% a year ago, according to the Rocky Mountain Lodging Report.  The average room rate climbed 7.5% to $118.06.  Grand Junction and Glenwood Springs, where housing shortages for energy workers are filling hotels, had the two of the highest occupancy rates in the state, at 86.2% and 77.5% respectively.  Estes Park and Durango also reported high occupancy rates.  The average room rate in Grand Junction of $82.65 has surged 21% over the last three years.

Housing: 

Housing permits fell 26.0% statewide through September.  Single-family permits were down 32.0%, while multifamily permits contracted 2.1%.  In metro Denver, single-family permits fell 36.3%, while multifamily permits increased 10.1%. 

Existing single-family home sales in metro Denver fell 8.8% in September relative to a year earlier, although they are down only 0.3% year-to-date.  The average price declined 7.4% for the month and 1.0% year-to-date.  The median price dropped 4.9% for the month and was flat through the first three quarters.  The inventory of homes for sales was slightly lower than a year ago, but average time on the market increased.   The Case-Shiller Home Price Index, which looks at comparable home price changes, declined 0.4% for metro Denver in August relative to a year earlier.  Nationally, prices fell 4.4%.

In Colorado Springs, sales of existing single-family homes fell 16.0% in October and were down 14.1% year-to-date.  Condo-townhome sales declined 24.8% for the month and 18.3% for the year.  Average and median sales prices were down for the month, although average sales prices were up 1.5% and 3.1% respectively for the first ten months of 2007.

Foreclosures in El Paso County rose to 2,573 through September, more than the total for all of 2006.  At their current pace, the record of 3,476 foreclosures set in 1988 will be surpassed, although the size of the housing stock is much larger than 19 years ago.  The local building department estimated there were one foreclosure for ever 123 households in the first half of 2007, relative to one for every 28 households in 1988.
The apartment vacancy rate in metro Denver fell to 5.3% in the third quarter, according to Gordon Von Stroh at the University of Denver.  This was the lowest level since the first quarter 2001.  The average monthly rent declined 0.6%from the previous quarter to $858.36.  Both the average and median rent were below their level a year earlier. 

Nonresidential: 

The value of nonresidential construction contracts in Colorado rose 3.9% through September.  All of the gain was accounted for by the 303% surge in Mesa County.  Statewide there were gains in retail, office, hospitals and public buildings.  There were large declines in manufacturing, education, amusement and miscellaneous.

According to Grubb & Ellis, the Denver office vacancy rate fell to 10.1% in the Central Business District in the third quarter, while the Southeast Suburban Office Market rate increased to 17.1%, reversing a four-year decline.  Average lease rates are rising in both markets.  The industrial vacancy rate rose sharply to 8.1%, after falling steadily for the last year. 

Commercial vacancy rates in Colorado Springs rose in the third quarter relative to the same period in 2006, according to Turner Commercial Research.  The office vacancy rate increased to 8.2%, the industrial vacancy rate to 7.6% and the retail vacancy rate to 7.1%.  Office lease rates rose 7.4% to $11.39 per square foot over the past 12 months.

There is a great deal of construction activity underway at the Colorado Springs Airport, according to a story in the Gazette.  A number of projects are underway to improve service to general aviation traffic, along with 120,000 square feet of hangar space to house World War II vintage aircraft and a museum.