Population Growth will spur demand
Colorado needs more than 1.3 million new homes and more than 1.7 million square feet of office and retail space to keep up with anticipated population growth between now and 2030, according to a new study.
The report, released Monday by the Brookings Institution, in part challenges local leaders to promote growth that is more compact, energy-efficient and "walkable."
It says the best residential real estate investments over the next 25 years will be those near offices, shops and mass-transit lines.
The West is expected to grow faster than any other region, with Colorado's population forecast to jump from 4.3 million in 2030.
The state is ranked sixth in housing demand and ninth in demand for commercial and institutional space.
Colorado has 1.8 million homes, but the study said 340,000 of those will be torn down over the next three decades.
According to the study's projections, builders would need to construct 52,000 homes a year for the next 25 years. The 2005 Colorado Business Economic Outlook says builders are expected to pull permits for 44,000 homes this year and another 44,000 homes next year.
"That's good news, but I have a hard time seeing those levels sustained over 25 years," said Don Gendall, director of business development for The Weitz Co. a commercial and residential construction firm in Denver.
Gendall said he was not surprised to see the study's projections for office space. He said the past five years have seen relatively small amounts of new retail and commercial space.
Developers are likely to direct much of the new growth to northeast metro Denver, said Jeff Willis, vice president of land acquisition development and sales for Shea Properties.
"You're limited in terms of what you can do in the northwest and southwest because of physical and political borders," he said. "Water rights and infrastructure are also limiting factors" that help prevent sprawl.
Source: Rocky Mountain News/Associated Press