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10% of state's economic output tied to commercial real estate

By John Rebchook, Rocky Mountain News (Contact)

Published January 7, 2008 at 12:03 p.m.
Updated January 7, 2008 at 12:03 p.m.

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The commercial real estate industry in Colorado produced a $24.3 billion economic impact in 2006, accounting for more than 10 percent of the state's total output, according to a report released today.

The report was commissioned by the Colorado chapter of the National Association of Industrial and Office Properties, which represents the interest of the commercial real estate industry.

NAIOP, as it is known, hired the University of Colorado Real Estate Center and the University of Denver Franklin L. Burns School of Real Estate to conduct the report. The Colorado State University Everitt Real Estate Center also reviewed the data.

"Our intent was to apply the highest standards of research methodology toward creating a realistic, comprehensive report specifically focused on commercial real estate construction and existing assets," real estate attorney Jim Mulligan said in a statement.

The findings underscore not only the industry's significance as one of the state's largest economic drivers, but also the leadership role that we must continue to provide toward helping Colorado's growing communities support job growth and continued quality of life, added Mulligan, the 2007 NAIOP-Colorado president and an attorney with Fairfield and Woods.

The study found that almost 70 percent of Colorado's commercial real estate jobs, taxes and other related revenues come from maintaining and operating existing office buildings, industrial properties, hotels and resorts.

Highlights of the report include:

The total output of $24.3 billion amounted to 10.5 percent of the Colorado economy.

Direct spending was $12.3 billion, or 5.4 percent of Colorado's economy.

Income-producing property construction generated $3.3 billion in direct spending and $6.9 billion in total economic output.

Commercial properties - not including apartments - paid $1.18 billion in property taxes.

Sales taxes on construction materials were $75.2 million, with a total economic impact of $160.7 million.