Archives for August 2019

Thanks to all of the brokers, sponsors, and guests who attended the August 2019 CCIM NM Deal Making Session and to those who shared their properties.

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Millennials and baby boomers are solidifying their stature as city dwellers. For many, the preference for metropolitan living represents a welcome and exciting change from a decades-long suburban existence. One survey of millennials found that half were living in city neighborhoods, including downtowns.¹ Meanwhile, the percentage of homebuyers in their 50s in and around central cities has edged up, and more than one-third of renters in such areas are 60 or older.
As a result, for the first time since the 1920s, U.S. central city population growth is outpacing the suburbs. This urbanization trend is bringing new employers, development and services to downtown areas, many of which lost population and new investment to the suburbs in the last half of the 20th century.
While the Great Recession temporarily stalled the migration, it largely picked up where it left off early in the recovery as the burgeoning technology and energy industries drove growth in markets like San Francisco, Denver, Austin, Texas, Seattle and Washington, D.C. Seattle, Austin and Denver, for example, ranked atop the fastest growing cities in the U.S. from 2010 through 2017, seeing their respective populations increase by 18.7 percent, 17.9 percent and 16.3 percent.
Millennials began venturing into city centers in search of a live-work-play lifestyle early this century and are choosing to live in metropolitan areas at a higher rate than any other generation. Empty nesters, in favor of living near cultural amenities and healthcare services, began moving downtown soon after.
The ongoing movement of these two generations into metropolitan areas continues to present real estate owners and operators with attractive opportunities. Both cohorts have an increasing propensity for renting versus buying which is fueling demand for apartments. Baby boomers are one of the fastest growing groups of renters in the nation: recently 81 percent considered renting more affordable than home ownership, up from 73 percent two years earlier. Three quarters of millennials felt the same way, an increase of 14 percentage points over two years. While developers are building apartments and condominiums close to jobs and transit to meet these generational preferences, strong demand for market-rate workforce housing persists in most metropolitan markets.

The growing number of millennials and baby boomers moving into cities continues to validate metropolitan areas as vibrant places to live, do business and play. Financially strong owners and operators with a track record of success in metropolitan areas will be best positioned to continue the growth trajectory of these vital markets while creating maximum value for shareholders and tenants alike.
By: Robert Dupree (NREI)
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New Mexico was ranked third in the nation in wind energy, as the state moves toward adopting more carbon-free energy options following the latest legislative session.

The American Wind Energy Association’s (AWEA) second-quarter market report showed the state hosting 2,774 megawatts (MW) of wind energy in construction or development, trailing Wyoming’s 4,831 MW and Texas’ 9,015 MW.

New Mexico was ahead of Iowa at 2,623 MW and South Dakota at 2,183 MW.

Texas’ wattage meant it hosted 22 percent of the nation’s total wind energy development, while Wyoming hosted 12 percent and New Mexico had 7 percent.

Iowa was at 6 percent and South Dakota was at 5 percent, records show.

In total, the report showed almost 42 gigawatts worth of wind energy capacity either under construction or in development, while long-term contracts for wind capacity was up 10 percent compared with the first half of 2018.

A megawatt is equal to a million watts, and a gigawatt is 1,000 megawatts. The average microwave oven has about 600 to 1,200 watts.

Buyers of wind energy across the nation included major retailers such as Walmart, Target and Hormel Foods.

The first half of 2019 saw continued increase in interest in wind energy from major companies across the state, while turbine manufactures responding to the increasing demand.

“Strong consumer demand from Fortune 500 businesses and utilities as well as calls from multiple states for offshore projects added to wind power’s growing development pipeline,” the report read.

“At the same time, wind turbine manufacturers saw an increasing number of factory orders for more powerful wind turbines capable of powering almost twice the number of homes as an average wind turbine installed in the past few years.”

AWEA Chief Executive Office Tom Kiernan said the increased investment in wind energy supports and energy source he said was “cleaner” and more affordable than traditional fossil fuel-based energy.

He said there are more than 200 wind farm projects ongoing in 33 states.

“Our industry’s success strengthens the U.S. economy because access to affordable, clean American wind power is a competitive advantage in the eyes of business leaders,” he said.

“And when those businesses invest in U.S. wind energy, it directly benefits the people living and working in our country’s farm, factory, and port communities.”

Kiernan said the wind industry was also bolstered by technological advancements allowing wind turbines to increase their output, but also called on state and federal governments to approve projects to increase power grid capacity to move the energy to market.

“We’re seeing a growing number of wind farms select turbines capable of powering nearly twice as many homes as the average U.S. wind turbine,” he said. “Wind technology innovation is keeping pace with demand, but we can’t afford to neglect the power grid infrastructure that delivers electricity from where it’s made to consumers.”

Wind power emerging in New Mexico

New Mexico’s rise to wind energy prominence began in 2017, when it added wind energy capacity at a higher growth than any other state, records show.

By: Adrian Hedden (ABQ Journal)
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