Recovery? Growth? Jobs? Capital Investment? Turning the Corner? Presented by Dr. Ivan Miestchovich, Jr., Director Institute for Economic Development & Real Estate Research The University of New Orleans
U.S. Economy
Going Forward
Unemployment Rates by State January 2012 ND SD NE KS TX OK MN WI AR IL IA LA MS MO WA OR ID WY MT CA NV UT AZ CO HI AK NM ME NY SC AL FL GA IN KY NC OH PA TN VA WV MI VT NH MA RI CT NJ DE MD DC 10
New Orleans Metro Job Overview The New Orleans metro area had 609,600 jobs in 2005 before Katrina. At the low point after the storm, the area had just 425,800 jobs (70% of pre-katrina). By October 2011, employment in New Orleans had grown to 529,300 jobs (86.8%). By the end of 2013, 531,500 jobs are forecast (87.2%). 11 Prepared by UNO Division of Business & Economic Research
N. O. Metro Total Employment 650 616.3 600 Jobs (1000's) 550 500 450 425.8 529.3 531.5 400 350 300 Jan-03 Jun-03 Nov-03 Apr-04 Sep-04 Feb-05 Jul-05 Dec-05 May-06 Oct-06 Mar-07 Aug-07 Jan-08 Jun-08 Nov-08 Apr-09 Sep-09 Feb-10 Jul-10 Dec-10 May-11 Oct-11 Mar-12 Aug-12 Jan-13 Jun-13 Nov-13 12 Source: US Bureau of Labor Statistics, DBER Prepared by UNO Division of Business & Economic Research
New Orleans Metro Total Population 13 Sources: US Census, GCR & Assoc., System Solutions Consulting Prepared by UNO Division of Business & Economic Research
Employment 2001 2011, Quarter 3 Orleans, Jefferson and St. Tammany Parishes 300,000 250,000 200,000 150,000 100,000 50,000 0 Q1/2001 Q1/2005 August 2005 Q1/2006 Q4/2007 Q4/2008 Q4/2009 Q3/2011 Jefferson 212,974 210,801 214,370 183,587 200,936 199,505 193,761 191,614 Orleans 261,646 242,843 241,264 142,812 170,544 173,630 169,368 172,890 St. Tammany 57,840 67,369 69,457 65,704 75,516 74,785 75,287 77,043 14 Source: Labor Market Statistics, Quarterly Census of Employment & Wages Program
N. O. Metro Construction Activity Per Month 350 300 $ Millions 250 200 150 100 50 0 2004 2005 pre-k 2005 post-k 2006 2007 2008 2009 2010 2011 Non-building Non-residential Residential Source: McGraw Hill Construction, Dodge 15
Foreclosures per Household New Orleans Metro vs. US 0.35% 0.30% 0.25% Percentage 0.20% 0.15% 0.10% 0.05% 0.00% 2007 Avg 2008 Q1 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4 2011 Q1 New Orleans Metro US 16 Source: RealtyTrac Prepared by UNO Division of Business & Economic Research
Single Family Average Price & Units Sold Metro 2004 to 2011 $235,000 17,000 $220,000 15,500 Average Price $205,000 $190,000 $175,000 $160,000 $145,000 $130,000 14,000 12,500 11,000 9,500 8,000 Units Sold $115,000 6,500 $100,000 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 5,000 17 Source: New Orleans Metropolitan Association of Realtors
Greater New Orleans Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 120 100 80 60 40 20 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: LATTER & BLUM Research Division Numbers are in hundreds for existing residential property only. Active Sold 18 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Single Family Average Price & Units Sold Jefferson Parish 2004 to 2011 Average Price $250,000 $200,000 $150,000 $100,000 $50,000 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 Unit Sold $0 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 1,000 19 Source: New Orleans Metropolitan Association of Realtors
Metairie Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 1800 1600 1400 1200 1000 800 600 400 200 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Active Sold Source: LATTER & BLUM Research Division 20 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Kenner Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 800 700 600 500 400 300 200 100 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Active Sold Source: LATTER & BLUM Research Division 21 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Single Family Average Price & Units Sold Orleans Parish 2004 to 2011 Average Price $275,000 $250,000 $225,000 $200,000 $175,000 $150,000 $125,000 $100,000 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Units Sold 22 Source: New Orleans Metropolitan Association of Realtors
Uptown Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 1,400 1,200 1,000 800 600 400 200 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 520 Active Sold Source: LATTER & BLUM Research Division 23 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Lakefront Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 1000 900 800 700 600 500 400 300 200 100 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Active Sold Source: LATTER & BLUM Research Division 24 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Single Family Average Price & Units Sold St. Tammany Parish 2004 to 2011 Average Price $275,000 $250,000 $225,000 $200,000 $175,000 $150,000 $125,000 $100,000 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Units Sold 25 Source: New Orleans Metropolitan Association of Realtors
Mandeville Area Single Family- Active Listings vs. Sold Listings 1989 thru 2011 FOURTH QUARTER 2000 1800 1600 1400 1200 1000 800 600 400 200 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/2011 Active Sold Source: LATTER & BLUM Research Division 26 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Single Family Average Price & Units Sold St. Bernard Parish 2004 to 2011 Average Price $135,000 $120,000 $105,000 $90,000 $75,000 $60,000 $45,000 $30,000 $15,000 $0 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 500 450 400 350 300 250 200 150 100 Units Sold 27 Source: New Orleans Metropolitan Association of Realtors
Single Family Average Price & Units Sold Plaquemines Parish 2004 to 2011 $325,000 $300,000 $275,000 $250,000 $225,000 $200,000 $175,000 $150,000 $125,000 $100,000 2004 2005 2006 2007 2008 2009 2010 2011 Ave Price Units Sold 140 120 100 80 60 40 20 0 28 Source: New Orleans Metropolitan Association of Realtors
Greater New Orleans Area Months of Inventory 2011 10.4 Months 2012 7.5 Months Source: LATTER & BLUM Research Division 29 This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Area by Area Months of Inventory Snapshot 2011 VS 2012 East Jefferson 10.6 7.3 Garden/Uptown 7.6 5.3 Metairie 10.0 8.0 River Parishes 9.9 5.8 Lakefront/Gentilly 10.6 6.6 Historic District 11.8 8.3 West Bank 10.0 7.3 W. St. Tammany 9.5 8.4 E. St. Tammany 14.7 8.1 30 Source: LATTER & BLUM Research Division This representation is based in whole or in part on data supplied by New Orleans Metropolitan Association of Realtors, St. Tammany Association of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations or their MLS may not reflect all real estate activity for all years.
Single Family Building Permits New Orleans Metro: 2004 2012, March 7,000 6,000 5,000 4,000 Annual Average 3,779 3,000 2,000 1,000 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 Mar 2011 Mar 2012 31 Source: US Census Bureau, Residential Permits
Single Family Building Permits St. Tammany Parish: 2004 2012, March 3,500 3,000 2,500 2,000 Annual Average 1,731 1,500 1,000 500 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 Mar 2011 Mar 2012 32 Source: US Census Bureau, Residential Permits
Macro Trends and the Apartment Market Recovering Economy Household Formations Undoubling Mortgage Market Fallout Foreclosures willful and otherwise Displaced Owners and Renters Homeownership Postponed Ramped Up Loan Qualification Housing Price Uncertainty Buy Now? Wait? Rent. 33
Apartment Market Select U.S. Cities Ten Highest & Lowest Occupancy Rates, 2011 100.0 95.0 90.0 85.0 80.0 N.O.: 92.6% U.S.: 90.25% 75.0 San Francisco, CA Oakland, CA Los Angeles, CA Washington, DC Denver, CO San Jose, CA New York, NY Orange County, CA Baltimore, MD Portland, OR New Orleans Metro Jacksonville, FL Kansas City, MO/KS Orlando, FL Syracuse, NY Columbus, OH Cleveland, OH Detroit, MI Houston, TX Dayton, OH Providence, RI 34 Source: Integra Realty Resources & Institute for Economic Development & Real Estate Research Surveys
Apartment Average Rent & Occupancy Metro 2004 to 2011 $1,200 100.0% $1,000 95.0% $800 90.0% $600 85.0% $400 80.0% $200 75.0% $0 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 35 Source: UNO Real Estate Center Surveys
Apartment Average Rent & Occupancy Orleans Parish 2004 to 2011 $1,400 100.0% $1,200 95.0% $1,000 $800 $600 $400 90.0% 85.0% 80.0% $200 75.0% $0 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 36 Source: UNO Real Estate Center Surveys
Apartment Average Rent & Occupancy Jefferson Parish 2004 to 2011 $1,050 100.0% $900 95.0% $750 $600 $450 $300 90.0% 85.0% 80.0% $150 75.0% $0 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 37 Source: UNO Real Estate Center Surveys
Apartment Average Rent & Occupancy St. Tammany Parish 2004 to 2011 $1,200 100.0% $1,000 95.0% $800 90.0% $600 85.0% $400 80.0% $200 75.0% $0 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 38 Source: UNO Real Estate Center Surveys
Office Suburban Market Select U.S. Cities Ten Highest & Lowest Occupancy Rates, 2011 100.0 95.0 90.0 85.0 80.0 75.0 70.0 N.O.: 84.6% U.S.: 83.02% Nashville, TN Pittsburgh, PA Greenville, SC Dayton, OH Fort Worth, TX San Francisco, CA Long Island, NY Los Angeles, CA Cleveland, OH Memphis, TN New Orleans Metro Milwaukee, WI Detroit, MI Jacksonville, FL Phoenix, AZ Indianapolis, IN Tampa, FL Tulsa, OK Sacramento, CA Las Vegas NV Chicago, IL 39 * New Orleans Metro occupancy rate includes Suburban and CBD market sectors Source: Integra Realty Resources & Institute for Economic Development & Real Estate Research Surveys
Office CBD Market Select U.S. Cities Ten Highest & Lowest Occupancy Rates, 2011 100.0 95.0 90.0 85.0 N.O.: 84.6% U.S.: 83.41% 80.0 75.0 70.0 65.0 Charlotte,NC Boise,ID Philadelphia,PA Portland,OR Washington,DC Oakland,CA New York,NY Pittsburgh,PA Fort Worth,TX Los Angeles,CA New Orleans Metro Cleveland,OH Atlanta,GA Tulsa,OK Las Vegas,NV Detroit,MI San Antonio,TX Dallas,TX Hartford,CT Dayton,OH Syracuse,NY 40 * New Orleans Metro occupancy rate includes Suburban and CBD market sectors Source: Integra Realty Resources & Institute for Economic Development & Real Estate Research Surveys
Office Average Rent & Occupancy Metro 2004 to 2011 $16.50 $16.25 $16.00 $15.75 $15.50 $15.25 $15.00 $14.75 $14.50 $14.25 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 100.0% 95.0% 90.0% 85.0% 80.0% 75.0% 70.0% Ave Rent Occupancy 41 Source: UNO Real Estate Center Surveys
Office Average Rent & Occupancy Orleans Parish 2004 to 2011 $16.50 100.0% $16.00 95.0% $15.50 $15.00 $14.50 $14.00 90.0% 85.0% 80.0% $13.50 75.0% $13.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 42 Source: UNO Real Estate Center Surveys
CBD Class A Skyline 1972 1979 1980 1983 1984 1985 1989 Current Class A Inventory: 9,674,351 SF in 16 buildings 61% completed between 1980 and 1985 Last addition (now Benson Tower) in 1989 43
Major Oil/Gas Retreat from Market Covington, LA 44
Who has filled the space Legal Governmental Health Software/new entrepreneurial wave Shorter term special projects Katrina related (engineers, insurers, etc.) BP related (legal, research) DEPARTMENT OF HEALTH AND HOSPITALS 45
CBD Class A Tower Percentage Occupancy 100 95 90 85 80 75 70 65 60 55 50 89.0 2004 2005 2006 2007 2008 2009 2010 2011 86.9 46
But... In 2011, there was 528,375 square feet more of occupied office space in the CBD than in 2010 Benson Tower - 488,000 SF Now 93% leased Exchange Centre- 400,000 SF Now 31% leased 47
CBD Class A Tower Office Rental Rates $20.00 $18.00 $16.00 $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $0.00 $18.00 $17.70 2004 2005 2006 2007 2008 2009 2010 2011 48
No Longer in Service as Office 49
Office Average Rent & Occupancy Jefferson Parish 2004 to 2011 $19.00 100.0% $18.50 $18.00 $17.50 95.0% 90.0% $17.00 85.0% $16.50 $16.00 $15.50 80.0% 75.0% $15.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 70.0% Ave Rent Occupancy 50 Source: UNO Real Estate Center Surveys
Historic Metairie Class A Occupancy 100 92.9 92.3 90 80 70 60 50 2004 2005 2006 2007 2008 2009 2010 2011 51
Metairie Class A Rental Rates $25.00 $22.60 $22.50 $20.00 $15.00 $10.00 $5.00 $0.00 2004 2005 2006 2007 2008 2009 2010 2011 52
Office Average Rent & Occupancy St. Tammany Parish 2004 to 2011 $18.00 $17.50 $17.00 $16.50 $16.00 $15.50 $15.00 $14.50 $14.00 $13.50 $13.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 100.0% 95.0% 90.0% 85.0% 80.0% 75.0% 70.0% Ave Rent Occupancy 53 Source: UNO Real Estate Center Surveys
Retail Market Select U.S. Cities Ten Highest & Lowest Occupancy Rates, 2011 100.0 95.0 N.O.: 91.6% U.S.: 90.25% 90.0 85.0 80.0 75.0 San Francisco, CA Oakland, CA Los Angeles, CA Washington, DC Denver, CO San Jose, CA New York, NY Orange County, CA Baltimore, MD Portland, OR New Orleans Metro Jacksonville, FL Kansas City, MO/KS Orlando, FL Syracuse, NY Columbus, OH Cleveland, OH Detroit, MI Houston, TX Dayton, OH Providence, RI 54 Source: Integra Realty Resources & Institute for Economic Development & Real Estate Research Surveys
Retail Average Rent & Occupancy Metro 2004 to 2011 (Excludes Freestanding) $17.00 $16.50 $16.00 $15.50 $15.00 $14.50 $14.00 $13.50 $13.00 $12.50 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 100.0% 95.0% 90.0% 85.0% 80.0% 75.0% 70.0% Ave Rent Occupancy 55 Source: UNO Real Estate Center Surveys
Retail Average Rent & Occupancy Orleans Parish 2004 to 2011 (Excludes Freestanding) $31.00 100.0% $29.00 95.0% $27.00 90.0% $25.00 85.0% $23.00 80.0% $21.00 75.0% $19.00 70.0% $17.00 65.0% $15.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 60.0% Ave Rent Occupancy 56 Source: UNO Real Estate Center Surveys
Retail Average Rent & Occupancy Jefferson Parish 2004 to 2011 (Excludes Freestanding) $16.00 $15.25 $14.50 $13.75 $13.00 $12.25 $11.50 $10.75 $10.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 100.0% 95.0% 90.0% 85.0% 80.0% 75.0% 70.0% Ave Rent Occupancy 57 Source: UNO Real Estate Center Surveys
Retail Average Rent & Occupancy St. Tammany Parish 2004 to 2011 (Excludes Freestanding) $16.75 $16.00 $15.25 $14.50 $13.75 $13.00 $12.25 $11.50 $10.75 $10.00 2004 Pre K '05 Post K '05 2006 2007 2008 2009 2010 2011 100.0% 95.0% 90.0% 85.0% 80.0% 75.0% 70.0% Ave Rent Occupancy 58 Source: UNO Real Estate Center Surveys
Dr. Ivan Miestchovich, Jr., Director Institute for Economic Development & Real Estate Research The University of New Orleans 2000 Lakeshore Drive 413 Kirschman Hall New Orleans, LA 70148 Phone: 504.280.1408 Fax: 504.280.3952 Email: imiestch@uno.edu Web: www.realestate.uno.edu or www.ced.uno.edu