Archives for July 2013

New Mexico’s seasonally adjusted unemployment rate was 6.8 percent in June 2013, up from 6.7 percent in May but down from 7.0 percent a year ago. The rate of over-the-year job growth, comparing June 2013 with June 2012, was 0.9 percent, representing a gain of 7,200 jobs. The jobs survey continues to indicate improved conditions in the local job market. Eight industries added employment over the year, four industries lost jobs, and one—transportation, warehousing, and utilities—remained at last year’s level. The largest gains continued to be reported by the leisure and hospitality industry, adding 3,700 jobs since last year. The financial activities industry also reported strong numbers, adding 2,300 jobs. The construction industry continued to report the best over-the-year numbers since 2006, gaining 1,900 jobs. Manufacturing employment declined by 800 jobs since last year, as did miscellaneous other services. Government employment registered a net loss of 3,400 jobs over the year, with most of the decline (2,400 jobs) reported in local government. The sharp drop in local government employment is likely a result of changing seasonal patterns that will settle by the time school begins at the end of the summer. Detailed analysis will be provided in the Labor Market Review scheduled for release on July 26.  NM Economic Data 7.19.13

This development is good news for commercial real estate for two reasons:

1. Commercial real estate improves as the economy improves (see NAR article on the subject)
2. Improvement in residential market is a good indicator of a positive future for commercial real estate (as this Youtube video touches on)

SF home sales rise as the economy improves (Albuquerque Journal)

Home sales in Santa Fe are on the rise, reflecting a moderate improvement to the economy, according to second-quarter statistics released by the Santa Fe Association of Realtors on Wednesday.
“Budget sequesters and sluggish export growth have taken a back seat to housing recovery and stronger consumer spending,” states a report on quarterly indicators.
The data shows a 5 percent increase in the volume of home sales in Santa Fe County from $145.8 million during the second quarter of 2012 to $153.9 million during the same period this year.
Total sales of homes within the city limits mirrored that trend with a 4.4 percent increase from 183 to 191 homes.
Victoria Murphy, president of the Santa Fe Association of Realtors, said home buyers have been purchasing more homes in the county, chasing lower prices and favorable interest rates.
“Now, we’re seeing more within the city limits because prices and interest rates are so great,” she said.
Sales for homes in the county dropped nearly 11 percent, from 157 to 140, during the second quarter as compared to the same period last year.
The exception was Eldorado, which continued to see substantial growth. Home sales there increased by about a third and prices rose by 16 percent from an average of $300,000 during the second quarter of 2012 to $348,000 this year.
In all, the average price for homes in both the city and county rose 4.9 percent from $332,808 to $349,103.
The median sales price rose at a similar percentage rate from $287,250 to $300,000. The median price for a single family home within the city limits dropped slightly to $252,684, while a sharper drop occurred in the county down to $331,500.
Condo and townhome sales in both the city and county increased from 72 to 84 year-to-year as the median prices remained relatively steady, dropping from $285,000 to $280,000.
Residential land sales made a significant jump, both in the city and county.
“With inventories remaining low, buyers are now purchasing land on which to build,” Murphy said.
However, Murphy said home inventories could be increasing soon. The word is that banks have been holding on to foreclosed homes, creating what’s referred to as a “shadow inventory.”
Citing a report by Sandra Claymore, a financial advisor with the Bank of Albuquerque’s Santa Fe branch, Murphy said more of those foreclosed homes could soon be entering the marketplace.
“Everything is looking good economy-wise, and they’ll start releasing those foreclosures,” she said. “Being an in-state bank, they’re able to turn those around very quickly because the underwriters are local.”
The housing inventory has leveled off during the past year, dropping slightly from 2,340 to 2,335.
Murphy said a mild jump in interest rates may have slowed home sales a bit. “But with home prices gradually moving upward and inventories at record lows, we are beginning to see more sellers entering the market, and buyers reacting quickly to many of those well priced homes,” she said.
The numbers back up that statement. Homes are staying on the market a shorter period of time than they were a year ago. During the second quarter of 2012, a listed home stayed on the market an average of 205 days before an offer was accepted, compared to 161 days this year.
That continues the year-to-date trend, where homes stayed on the market an average of 211 and 210 days through the first half of 2011 and 2012, respectively, to an average of 174 days through the first six months of this year.
By T.S. Last

See original article

The Rio Rancho Governing Body voted down a new contract with the Rio Rancho Economic Development Corp., but asked for a reworked agreement that would end conflict between city and RREDC staff and ensure creative thinking in business recruitment.
At their meeting Wednesday at City Hall, councilors Mark Scott, Lonnie Clayton and Chuck Wilkins voted against the one-year $80,000 contract, while councilors Tamara Gutierrez and Patricia Thomas voted for it. Councilor Tim Crum was absent.

RREDC is a private, nonprofit organization that works to recruit businesses and job centers to the community.
Under city purchasing guidelines, City Manager Keith Riesberg said he could have executed an agreement without governing body approval, but he put it on the agenda because of concerns governing body members had expressed.
Thursday, Wilkins said he had noticed from the time he was elected that RREDC staff and city employees didn’t work well together.
“It needs to get fixed, and it needs to get fixed now,” he said.
Wilkins didn’t want to go into detail about the disagreement because he was concerned that would make it harder to recruit businesses.
At the meeting Wednesday, Wilkins said he would vote against the contract until Riesberg could assure him the rift he saw would be removed. The proposed contract requirement of extra meetings between both parties is necessary, he said.
“I’m sorry; when you’re a contractor, you’ve got to work with the staff,” Wilkins continued.
RREDC staff shouldn’t ask a councilor to fire a city employee, as had happened at a meeting he’d attended, he said.
Clayton complained that RREDC only recruited economic base businesses — mainly manufacturing and commercial companies — instead of retail, and that the proposed contract didn’t address the issue.
Also, he said it was a conflict of interest that RREDC President Noreen Scott represented both the city and Sandoval County in business recruitment.
Mark Scott said he had been very disappointed that RREDC board members hadn’t contacted him since a meeting right after he was elected in 2012 until three hours before the council meeting to ask if he had any questions about the contract. He said he already had his research completed and didn’t feel it was appropriate to discuss the contract in that context.
Mark Scott said he wanted a team approach and new, creative recruitment ideas for economic development.
“Rio Rancho needs to be on the cutting edge of economic development, business building, bringing people in. Otherwise, we’re just like every other city in the United States,” he said.
Noreen Scott wasn’t at the meeting because of a prior commitment out of state.
EDC board member, business owner and Rio Rancho resident Matt Spangler said the RREDC-city partnership has brought in 74 economic-base businesses since its inception in 1992, and 51 of those companies are still here.
“This partnership has brought tremendous results to this city,” he said.
In 2012, Spangler said, RREDC helped Stolar Research Corporation and MSDS Pro locate in Rio Rancho, and partnered with the city to replace the exiting Victoria’s Secret call center with the Alliance Data call center.
Spangler named three reasons to continue the partnership.
“First and probably most important, I believe economic development is the source of a vast majority of gross receipts tax income,” he said.
Secondly, Spangler said, being a private, nonprofit entity, RREDC can raise private money and use it to help in recruitment for the city. In the last two years, two-thirds of RREDC’s income came from private sources, he said.
Third, the private corporation can also protect confidentiality, instead of being required to offer the information to the public, possibly leading a business to cross Rio Rancho off its list of prospective locations rather than reveal its intentions.
Former RREDC board chairman Terry McDermott said confidentiality was critical to a company coming to a community. He also said the EDC navigated legislative and marketing issues for the city.
In public comment, Rio Rancho resident Cheryl Everett said several city employees give reports dealing with economic development, and part of the mayor’s job is representing the city in such matters. She said the city should revoke overlapping jobs.
Warren Pistols owner Chuck Warren said he looked around this area for a place to locate his manufacturing operation and decided to have facilities both in Sandoval County and, in the near future, Rio Rancho. Noreen Scott was a lot of help, he said.
Mayor Tom Swisstack asked city and EDC representatives to see how they can work together and creatively. A contract is to come before the governing body at the Sept. 25 meeting.
By Argen Duncan (Rio Rancho Observer)
Click here for source article

How Albuquerque is winning the hearts and minds of over-taxed executives and their companies.
Albuquerque Economic Development, Inc. and several of its partners pooled resources to develop this eight page special section that appears within the July issue of Site Selection magazine. The marketing piece promotes the important tax changes adopted by Governor Susana Martinez and the New Mexico Legislature earlier this year. Click here to view the special section. The printed and online total circulation of Site Selection is 57,000+ readers, and it reaches site selection professionals and companies considering location decisions.
Read an excerpt below: