A View of the Rockies: A Regional Economic Development Blog for Denver

Personal Thoughts: A Return to Colorado, the Importance of Transit Investment

2012-01-01T14:03:00.000-07:00

I began this blog more than four years ago in 2007 as a way to stay connected with economic development issues in my hometown region of the Denver Metro Area.   About six months ago I moved back to the Front Range. Now after 25 years I am a resident again in my hometown of Boulder Colorado.   I am very thankful to be able to help out and keep an eye on an aging parent who only lives a mile away from me.

Since I left Colorado I have been fortunate to have lived in regions with strong public transportation systems: Boston, London, New York, San Francisco, Washington DC.   Despite many many return visits to Colorado and the careful watch I have kept over the FasTracks developments, I was really not sure what the day to day experience would be in using Mass Transit in the Boulder/Denver Area.

My first thought is I have been pleasantly surprised.   I am very appreciative of how well connected Boulder is to Denver via the BF/BX/BV routes and how well served Denver itself is by local bus routes.   Both my wife and I are frequent users of these routes for commuting and personal trips.   However, as good as this system is, there are big gaps that need to be filled.

As the national economy struggles, concerns about environmental sustainability continue and the likelihood of energy price increases remain, my thoughts keep returning to the great wisdom of the Denver Metro Area's plan to build FasTracks.

The timing of this investment could not be more critical: it is creating job in a weak economy, providing more sustainable transit alternatives to a congested region, promoting economic vitality and regional competitiveness along the Front Range, and helping facilitate an increase in population while protecting the quality of life.

Over the next few years the Denver region will come to another transit cross roads.   We will have to decide if we are willing to pay higher taxes to fund transit infrastructure investments to complete the FasTracks build out and take our transportation investments to the next level of vision---or retrench while the historic opportunity to make the Denver region a world class metropolitan area recedes backwards.   In my mind this is one of the two or three most important regional economic development questions the Denver Region will face and we will have to live with the consequences of our choice for decades to come.

Space Industry Moves Forward in Colorado

2011-12-18T23:00:00.001-07:00

I was talking to friends last week about an investment property they are buying in Loveland. They mentioned they were excited about the prospects for the thousands of potential new jobs which could be created in Loveland by the ACE industrial park joint venture between NASA, the Colorado Association for Manufacturing and Technology and a private real estate developer. My first reaction was that the park's future was uncertain because the original developer, United Properties, stopped its negotiations with the City of Loveland to buy the Agilent Technologies Inc property. However, I was excited to learn that a new developer, Cumberland & Western Resources LLC is close to buying the property and moving the project forward.

The Space economy is very important to the Front Range and has prospects for future growth even beyond the ACE park. According to the Colorado Space Coalition the aerospace industry in Colorado employees 163,000 people and the state has the 3rd largest space economy in the U.S.

Recently Governor Hickenlooper announced that the State of Colorado is applying for a spaceport designation from the Federal Aviation Administration. "Spaceport Colorado" is tentatively slated to be located at Front Range Airport near Watkins and east of Denver in Adams County. The creation of a spaceport in Metro Denver would likely promote economic and real estate development in the vicinity of the facility.

Both the ACE park and Spaceport Colorado will be very interesting to watch develop over the next few years.

Uncertainty Surrounding Former StorageTech Site Illustrates the Drawbacks of Relying on Out of Region Firms for Economic Development

2011-11-26T19:35:00.000-07:00

The redevelopment of the former Storage Technology Site in Louisville into a training and R&D facility for ConocoPhillips was going to provide an economic boost to the "Renewable Range" cluster of green energy firms in the Denver region and to the broader economy.

However, recent uncertainty over the future of the site illustrates the drawbacks of not having homegrown, in-region headquartered firms driving economic development decisions. When Houston-based ConocoPhillips announced a split into two separate publicly traded companies, ConocoPhillips, an upstream exploration and production energy company and Phillips 66 a downstream consumer-facing refining, marketing and midstream business, the plans for the Louisville campus came into question. Future decisions will be made by the leadership of Phillips 66 and may or may not reflect the previous vision espoused by the legacy ConocoPhillips leadership. When land use decisions are made by companies with distant, out of state headquarters, there is an exposure to changes in strategic and leadership direction which can imp3de local progress.

Here is to hoping this site still gets redeveloped by Phillips 66 in a way that enhances the regional green energy cluster and boosts the overall economy in the Metro Denver area.

Denver "Cool City" for Young Adults During Recession....But Can The Area Retain This Talent?

2011-11-20T19:29:00.002-07:00

William Frey from the Brookings Metropolitan Policy Program recently released demographic data showing that the Denver Metro Area had a net gain of more than ten thousand young adults (aged 25 to 34) from 2008 to 2010 making it the number one gaining Metro Area in the U.S. during the Great Recession. It jumped from a ranking of twelfth in 2005 to 2007 (see chart to left from Brookings).

Frey describes the strong net inflow performance of cities like Denver in the following way:

"To the extent they are moving at all, young adults are headed to metro areas which are known to have a certain vibe—college towns, high-tech centers, and so-called 'cool cities.'...The top three areas [Denver was number 1] and our nation’s capital, arguably, fared relatively well economically during the recession. But all seven are places where young people can feel connected and have attachments to colleges or universities among highly educated residents."

Which brings me to a fascinating conversation I had the other night at dinner with an old friend I used to work with in New York. My friend, who has lived in the Denver Metro Area for more than 10 years, has top notch professional and academic credentials with many interesting and impressive career experiences. One thing he told me was that, in his experience, the relatively small size of the Metro Denver employment market leads many talented people to ultimately move on to larger business centers to further their careers.

Clearly the Denver region is attracting energetic young people who are critical for keeping the area economically vital, creatively vibrant and providing a strong labor talent pool. However, the big question this raises in my mind is "Can the region attract and/or organically grow enough top tier job opportunities to retain this population as it ages and grows into senior management roles?"

This is a big and critical challenge for the Denver region.

Two for Two, Colorado Over New York: GE Selects Aurora Site for PrimeStar Thin Film Solar Plant

2011-10-13T18:39:00.012-06:00

The Centennial State is on a two-day site selection roll over the Empire State as Colorado won out over New York State for the location of a thin film solar factory for newly acquired General Electric subsidiary PrimeStar. Given the Arrow Electric news from yesterday it has been a good economic development week for the Denver Region.

It is particularly notable that PrimeStar was a Colorado company which developed the underlying technology with the National Renewal Energy Laboratory in Golden. So the full product life cycle from basic R & D to product development to commercial production will all be vertically integrated within the state of Colorado.

The hundreds of manufacturing jobs offered by this plant will boost local labor and real estate markets and reinforce the renewable energy cluster in the Front Range. I don't know if GE will be exporting any of these panels outside this U.S. but this also has the potential to boost Colorado's weak export numbers.

Right on Target: Arrow Electronics Moves Global HQ to Colorado

2011-10-12T17:37:00.011-06:00

In a time of high economic anxiety, the announcement that Fortune 200 company Arrow Electronics is moving its global headquarters to Arapahoe County, Colorado from Long Island in New York is great news for Metro Denver from an economic development perspective.

See an excellent series of article from the Denver Post: Hickenlooper's role, article with analysis and graphics, the role of tax credit incentives, and breaking news article by Post writers Svaldi and Griffin.

Arrow Electronics Press Release.

Earlier blogs about the dearth of Fortune 500 Headquarters in Colorado here and here.

Difficult Questions Surround the Stock Show Relocation Plan

2011-06-27T17:38:00.004-06:00

The emerging donnybrook between the cites of Denver and Aurora over Gaylord Entertainment's proposed hotel and theme park complex at the High Point Development near DIA raises some of the most vexing economic development questions to hit the Metro Denver region in several years.

Will the proposed development, near DIA and along the planned airport train route, promote regional economic well being or drain energy and convention business from the Metro Area's urban core in downtown Denver which has been so painstakingly built up over the past few decades?

Should the State of Colorado award a multi-hundred million dollar tax increment financing subsidy, perhaps the largest ever in Colorado, to help build 1,500 hotel rooms and 500,00 of convention space in Aurora?

Is this plan the only way to ensure the cherished National Western Stock Show is revitalized and modernized and stays in Colorado for the foreseeable future?
Can Denver and Aurora find a formula for approving the Gaylord project, keeping the Stock Show in Denver and making sure their is an equitable distribution of economic benefits and costs flowing from any potential related new developments?

Will Governor Hickenlooper play a role in this deal?

The Denver Post has an excellent primer exploring these issues.

A View of the Rockies will be closely studying this situation in the coming weeks and months. So far we don't know enough to have an informed opinion.

The Denver Way

2011-06-11T17:11:00.017-06:00

Growing up in Colorado and living as an adult in Boston, New York, San Francisco and now New Jersey, I have always admired the State of Colorado and its cities like Denver for having decent, effective, well-run governments that are able to make decisions and execute projects to promote civic improvement. As a young, western city without the types of entrenched establishment interests and ethnic tribalism that exist in some older locales, Denver seems to exhibit an openness to newcomers and new ideas.

Economic development gurus like Richard Florida argue that a key to attracting the creative, information savvy workforce needed to power the economies of today and tomorrow is openness to ideas, lifestyles, cultural variety, ethnic and racial diversity and other differences among people.

The election of Michael Hancock as Denver's 44th Mayor is instructive. The city's last four elected Mayors come from diverse backgrounds: African American, Caucasian, and Hispanic. The fact that two of the last three people elected mayor of Denver have been African American, in a city in which only 11% of the population is black, is particularly striking and strong evidence that Denver is a relatively open and tolerant city.

It seems to me that a repeated willingness of a citizenry to elect leaders from different racial and cultural backgrounds to top level positions, is a compelling example of openness and tolerance and will go a long way toward promoting the "Denver brand" to the creative class.

ACE Manufacturing and Innovation Park Likely Coming to Loveland

2011-04-09T17:28:00.004-06:00

Media Accounts are putting the CMAT Space Park site in Loveland (previous blog post here).

Account from the Coloradan.

The Reporter Herald's Story

The view from the Daily Camera here and here.

USA Pro Cycling Challenge

2011-04-09T17:20:00.002-06:00

The establishment of the USA Pro Cycling Challenge race in Colorado is big news and a long time coming. The race is also getting national media coverage from NBC. This is very welcome and exciting news indeed.

Update: Aerospace Park A Real ACE for Colorado

2011-02-20T08:56:00.004-07:00

My instincts tell me that if the Aerospace Clean Energy (ACE) research and manufacturing park, the public private partnership between NASA, and the Colorado Association for Manufacturing and Technology "takes off" (pun intended) this would be one of the biggest economic development events ever to occur in Colorado. There will be many challenges along the way and this will be a fascinating story to watch unfold.

The indispensable John Rebchook has an interesting update in a recent blog entry on the ACE Manufacturing and Innovation Park.

The Denver Post also had a recent article about the locations under consideration by the site selection team.

HOK Return a Positive Indicator

2011-02-06T07:41:00.005-07:00

This tid bit from the Denver Post seems to augur a very positive economic development trend

"St. Louis-based HOK is returning to Denver after closing its office here during the economic downturn of the 1980s. It's looking for office space downtown for a number of its core practice areas, including aviation and transportation; science and technology; and health care, said Rebecca Nolan, senior vice president and managing principal of the firm.

'We're very high on Denver and the Front Range and all the things that are happening there,' Nolan said. Companies that the firm works with on corporate accounts are expressing an interest in Denver, she said.

Nolan declined to name those considering opening offices here, saying only that they range from large corporations to professional and financial-services companies.

'Clearly, with the kind of international corporations that are investing in Denver, it would suggest that there is long-term confidence in the quality of the corporate environment,' Nolan said. 'We absolutely see it and feel it.' ''

One thing which left me a bit puzzled is according to the firm's web site they presently do have an office at 2190 East 17th Avenue in Denver which is one of their 25 regional offices around the world. I am thinking this must be a small skeleton office.

The Colorado Advantage: Governor Hickenlooper Sounds Economic Development Themes in Inaugural Address

2011-01-15T09:02:00.005-07:00

During his inaugural address on January 11, 2011, Governor Hickenlooper discussed economic development in Colorado extensively from the need for county level economic development plans to defining "The Colorado Advantage" that he plans market to global employers, capital, and talent.

[Photos by Evan Semon and downloaded from http://www.colorado.gov/]

See key excerpts below and full text here.
====================================================================================

"Today, I will sign several Executive Orders. The first order requires state government to join in partnership with local communities in creating jobs and designing economic development plans that are uniquely suited to these communities. This effort, focusing on the use of local talent and resources, is an initiative for all 64 counties - from Dolores to Douglas, from Mineral to Morgan - and all the places in between. We will chart a course for economic revival from the bottom up, county by county. On Friday, I will embark on a four-day trip around the state to begin this process.

Our second Executive Order places a new emphasis on global opportunities as an engine for job creation. Business is about relationships. This order will create the
Governor's Trade and Tourism Ambassador Program. We intend to enlist Colorado-related businesses and individuals living in other states and countries who have a stake in Colorado. These volunteer ambassadors will spread the word about Colorado, brand us as a state that welcomes innovation and new investment, and help us spur international tourism and export opportunities.

A third Executive Order begins the task of making the State a more effective
partner with our counties. It provides for more flexibility and less bureaucracy; more freedom with fewer mandates. It also sends a message to the private sector that we mean to cut red tape, make licenses and regulations more rational and easier to understand, and that we mean to do it as a partner with local communities....

We will measure everything we do and make changes where change makes sense. We will protect our land and water and preserve the natural beauty that helps define Colorado. Above all, we will focus on education as the social bedrock for the hopes and dreams of our children and the quality of their jobs.

In these most challenging of times, while we recognize the limitations of government, we don't have to - nor should we - limit our dreams of what Colorado must be.

Colorado must be a place known for embracing young entrepreneurs with fresh ideas and innovative ventures.

Colorado must be a place where kids get a world-class education preparing them for the rigors of leadership and the jobs that will define prosperity in the 21st century.

Colorado must be a place where our college degrees and the learning they signify are the envy of every other state.

Colorado must be a place where we are known, not only for the beauty of our landscapes and wonders of nature, but also for the advance of new technologies and new ways of powering the economy.

Why Colorado more than any other place? We have one of the most highly-educated work forces in America. We have perhaps the highest percentage of any state, of people who came here not for a job or promotion, but for our quality of life. And they have kept coming even through this long, hard recession.

Plus, we have the best beer.

Rest assured, we will be obsessive in spreading the word about the Colorado advantage."

NASA Agreement with CAMT to Promote Technology Commercialization and Clean Energy

2010-12-21T09:20:00.011-07:00

The excerpt below from a NASA Press Release does a good job of explaining the public private partnership (a.k.a. The Space Act Agreement) created between NASA and the Colorado Association for Manufacturing and Technology (CAMT) to promote space technology commercialization, clean energy, aerospace and economic development in Colorado. The partnership, which will be housed in a newly built research park at a site in Colorado which has yet to be selected, could create up to 10,000 jobs over the next five years in the Front Range.

[NASA and Colorado officials sign Space Act Agreement creating public private partnership. Photo courtesy NASA/Bill Ingalls from www.whitehouse.gov]

"NASA's agreement with the Colorado Association for Manufacturing and
Technology (CAMT) created a Technology Acceleration Program and Regional
Innovation Cluster for Aerospace and Clean Energy. A manufacturing park focused on rapid new product development and production will be developed to assist growing Colorado businesses.

"This park will use Colorado's existing competitive strengths to boost
economic growth while creating new jobs and products for aerospace and energy
industries," Garver said. "NASA is pleased to collaborate on new technology
developments like the one being created through the Colorado Technology
Acceleration Program and Regional Innovation Cluster."

Under the agreement, small and mid-sized businesses will have direct access
to a NASA "innovation ambassador," an agency expert who can identify NASA and
partner technologies ready for commercialization. The ambassador will conduct
forums to drive partnerships among NASA and Colorado businesses and help
identify businesses that can benefit from commercialization technical
assistance.

"The new agreement with NASA is a perfect fit for Colorado because it will
enhance our leading aerospace industry and growing high-tech business and
research sectors," Ritter said. "Most importantly, this will bring high-tech
jobs to our state. Colorado is a hub for innovation and continues to attract the
best and the brightest workers. Congratulations to CAMT and NASA for making this
historic agreement."

[Image from NASA/courtesy of nasaimages.org]

The Technology Acceleration Program will allow companies to work with NASA and expedite product development from an average of five years to as little as
18 months. New products will get to market more quickly, and new high tech jobs will be created. "Aerospace and energy are the fastest growing industries in Colorado, sharing the same supply base and similar workforce needs," said Elaine Thorndike, chief executive officer of CAMT.

"Through regional innovation clusters, public and private sectors can work
together to increase business opportunities, technical assistance programs and
market penetration for aerospace and clean energy manufacturing strength."

The NASA-CAMT partnership will provide technical assistance and identify
gaps in commercialization and scouting services to help companies looking for
space-developed technologies and services. It will help companies bridge the gap
between prototype design, manufacturing and commercialization, while identifying
commercial applications for NASA technologies."
Links
Daily Camera articles here and here.
Colorado Association for Manufacturing Technology (CMAT).
White House Office of Science and Technology Policy story.
Remarks of CMAT CEO Elaine Thorndike.
CMAT description of Technology Acceleration Program.

Exports from Colorado: A Bit of Good News?

2010-11-28T17:50:00.007-07:00

Colorado, a land locked state with a relatively small manufacturing base, has traditionally been a weak exporter. According to the Metro Denver Economic Development Corporation's report Toward a More Competitive Colorado, the state's ranking in per capita export dollars was 47th, the fourth lowest in the U.S. in 2008 and down from a ranking of 33rd in 2000.

However there are some signs of improvement. The Denver Post recently wrote about a modest recovery in Colorado exports this year and Slate did a business feature profiling the challenges faced by the innovative "clean tech" air conditioning manufacturer Coolerado, based in Denver, that is exporting highly efficient cooling systems to the Middle East and around the world.

Given the weak U.S. economy and the economic growth occurring in developing countries, increasing exports of goods and services is a potential pathway to success for companies in Colorado.

Brookings/Leinberger: The Next Real Estate Boom

2010-11-21T09:27:00.007-07:00

The Brookings Institutes's Metropolitan Policy Program continually puts out excellent work.
Christoper Leinberger's recent short article, The Next Real Estate Boom, does an insightful job of weaving together a multitude of ideas and trends into an analysis for holistically tackling many of the most vexing economic and public policy questions faced in the United States today. All of the following and more are discussed in an interrelated way:

1) The increasing demand for walkable, transit-oriented, mixed use neighborhoods
2) The current Great Recession and how to get the economy moving forward
3) Global economic competition
4) Global warming and energy policy
5) Transportation policy and infrastructure investments
6) Demographic trends from the Baby Boomers to Generation Y
8) The emergence of Salt Lake City as a potent economic hub with a unique sense of place (an area of notable concern for this blog)
9) Reforming Fannie and Freddie

Thinking about Metro Denver, this article helped reinforce for me the critical importance of finding a way to move ahead with the full FasTracks program to help the region build a successful future.

The Carnival Cafe and the history of Natural and Organic Foods in Boulder

2010-11-20T15:17:00.004-07:00

I wanted to share an excellent article from the Boulder Weekly by Roger Freed from this August about the Carnival Cafe and the counter-cultural milieu from the 1960s and 1970s in my hometown of Boulder which ultimately incubated a potent regional cluster of wholesale and retail business in the natural and organic foods sectors in the Boulder area. See quote below:

"The Carnival Cafe was a colorful potpourri of enthusiastic alternatives. Vibrant posters papered the walls, and plants possessed corners and overflowed from shelves. A huge, U-shaped , glass display counter dominated the middle of the main dining room and housed hand-made trinkets for sale and whole-grain goodies generous in their size , price and healthy ingredients. The insider name of the bakery section was "the Dateful Bread." Behind the back counter, bangel bedecked girls in tie-dye T-shirts and saris baked next to the long-haired fellows in sandals who were cooking."

No on 60, 61 and 101

2010-10-17T10:03:00.005-06:00

This blog takes a non-partisan tone and stance on economic development issues in the Denver Region.

However, I want to clearly state that passage of Amendments 60 and 61 and Proposition 101 would be economically devastating for Colorado and these ballot items should be rejected by state voters with "NO" votes.

These three items would cut the school property tax mill levy by 50%, eliminate state bond financing to support infrastructure projects and capital investments (and vastly curtail the ability of local governments to use bond financing) and reduce the state income tax which supports education, health care and transportation. Collectively these items would devastate K-12 and state sponsored higher education in Colorado, cripple the state's ability to invest in critical infrastructure projects and lead to devastating losses of jobs and economic competitiveness.

Tom Clark from the Metro Denver Economic Development Corporation provided a compelling assessment of these items as "Job Killing Measures" in the Colorado Energy News website.

Please vote "NO" on 60, 61, and 101 and visit the web site donthurtcolorado for more information.

Boulder: Braniest, Foodiest, Best Town for Startups

2010-10-09T08:59:00.004-06:00

Kudos to my hometown for all the recent kudos:

According to an analysis by Richard Florida published in The Daily Beast, Boulder is the Brainiest City in America.
Business Week says Boulder is "America's Best Town for Startups."
Bon Appetit dubs Boulder "America's Foodiest Town 2010".

If that is not enough, Denver was ranked the 8th Smartest Large Metro Area by CNN.

The Competitive Threat to the Denver Region from Salt Lake City

2010-09-12T10:33:00.007-06:00

Both the University of Colorado and the University of Utah are joining the Pac-10 conference in the next two years. Colorado, the first school to receive the invitation was a key prize in the Pac-10's expansion, long courted by the conference along with the University of Texas. Utah, was almost a consolation prize. Less prestigious and less of a traditional football power than Colorado, the Salt Lake City based university was only offered membership after a Texas-led coalition turned the Pac-10 down.

However, the actual current competitive athletic balance between the Universities of Colorado and Utah in the key revenue generating sports of football and men's basketball favors Utah. In fact, today, its not an exaggeration to say that Utah has an overwhelming (and embarrassing) competitive advantage over Colorado as the two schools prepare to join the Pac-10 and renew their "natural geographic rivalry."

This story about competitiveness in intercollegiate athletics can also be seen as a potent analogy about economic competitiveness between the two regions and should serve as a warning to civic leaders and public officials in the Denver region.

People in Metro Denver are used to thinking about Salt Lake City like a much younger sibling, sharing some of the same family traits but not as fully developed and not a real threat to the Denver region's status in the world. Economic development officials in Colorado have targeted recruitment efforts and marketing campaigns in California, Arizona and Texas but have not focused as heavily on Utah.

However, from my very first blog entry more than three years ago I have been contemplating the regional competitive threat that Salt Lake City posses to Denver's economic vitality. The two region's are far enough apart that there is not much beneficial spill over of economic activity from one to the other but at the same time are geographically close enough together in the Mountain Time Zone that they can serve as substitutes for each other. Utah has outstanding recreational amenities --world class skiing is closer to Salt Lake City than it is to Denver. Salt Lake City has raised its international profile by successfully hosting a Winter Olympics while Denver shirked its earlier opportunity. The possibility that the merged United-Continental will shrink its Denver United hub while retaining or growing its Salt Lake City Continental hub is a real threat to Denver International Airport. Additionally economic development gurus have recently been citing Salt Lake City as a top technopole. In the Milken Institutes's report, The Best Performing Cities of 2009, Salt Lake City is the number 3 ranked best performing large city but Denver is only 55 (Fort Collins and Boulder are 22 and 44 respectively).

Denver's long term economic vitality is dependent on competing globally for capital investments, talent, corporate jobs and headquarters. The Front Range's global competitiveness will be undermined if it has to play second fiddle in its home region in the Rocky Mountains.

Davita Announces Location Near Union Station

2010-07-16T18:58:00.008-06:00

(Artist rendering of proposed Davita Headquarters, Downloaded from DenverInfill blog, Courtesy of Davita Inc./Moma Architecture)

Davita, the Fortune 500 kidney care company that is relocating its corporate headquarters to Denver, selected a site at 2000 16th street, near Union Station for its new building. The 14 story 270,000 square foot building is expected to cost around $100 million to develop and will initially house an estimated 450 employees. The relocation of a new corporate headquarters to Denver, near Union Station, is great news during the current economic environment for a number of reasons.

It will bring much needed short term construction and long term corporate jobs to the region.

It is a vote of confidence in the Union Station redevelopment efforts, boosting the property tax revenues in the district and helping to ensure repayment of the tax increment financing (TIF) bonds used to fund the redevelopment.

The location near the FasTracks public transportation hub is great example of sustainable, green, dense, infill growth.

Its a boost for downtown Denver which is reeling from the recent loss of notable headquarters such as Qwest.

Fortune 500 relocations are rare and have been hard to achieve particularly in Denver and bring prestige and professional services jobs with them (local finance, accounting, consulting, and business services companies get a boost). Davita also plans to house its corporate training hub in this facility so it will bring thousands of business travelers into downtown Denver each year.

Davita's choice to be an owner-occupier of their building instead of a lessee in a multi-tenant office tower, increases the probability that the building will be an architecturally distinctive signature tower. Compared to speculative developers, owner-occupiers tend to spend more on architecture and design, seeing their building's as embodiments of corporate character instead of just trying to maximize the cash flows of their assets.

This development along with the decision by IMA Financial Group to locate its headquarters in one of the Union Station "wing" buildings, clearly shows the powerful gravitational pull of FasTracks. According to the Denver Post quoting, Davita CEO Kent Thiry, on the location decision:

"It's going to be great for our teammates," Thiry said. "The fact that there's so many forms of mass transit, the fact that there will be a huge variety of places where people can live conveniently and the fact that there will be such easy access to restaurants, shopping, entertainment, all while being in a green environment is sort of a rare combination."

The Davita announcement is great news for economic activity in all of downtown Denver. However, I am also thinking that this is the beginning of a trend where the classic 17th street office corridor in downtown Denver, nicknamed "the Wall Street of the Rockies," could struggle to retain tenants and lease space while Union Station and Lower Downtown thrives. 17th Street landlords and property owners must be strategizing about how they can "pick up their game" with increased amenities and attractions or suffer a relative decline in their fortunes.

The Front Range Cluster Deepens

2010-07-11T09:05:00.005-06:00

[Photo to left from www.vestas.com/, concept of new research facility planned for Louisville, CO]

This past week there were a several exciting sustainable energy announcements in Metro Denver boosting the status of the regional green energy cluster.

Vestas announced it will open an R&D engineering site in Louisville, Colorado strengthening the company's presence in the Front Range.

The U.S. Department of Energy granted two Metro Denver companies, ADA-ES in Littleton and Ion Engineering in Boulder, $14 million to fund development of technology to capture carbon dioxide released during the burning of coal in electric power plants.

President Obama announced a $400 million federal loan guarantee to Abound Solar, a Loveland-based company, started in part by Colorado State University engineering faculty. The federally financed expansion will bring an estimated 300 new jobs to the company's manufacturing facility in Longmont.

The Vestas Press Release describes the importance of Colorado to the company's long term plans and the reasons behind its decision to concentrate its North American production facilities in the state.

"Denver, Colo. – (July 7, 2010) – Vestas, the world’s leader in producing high-tech wind power systems, announced today that it will open an Engineering Site in Louisville, Colo., to support Vestas Global and enhance Vestas’ wind power production capabilities throughout North America. Vestas will move 46 employees into 47,675 square feet of space on Centennial Parkway, Louisville starting today, and will expand this team to include up to 125 highly skilled engineers within a year’s time.

The Vestas Engineering Site will enhance Vestas’ ability to integrate product development by placing it close to the company’s three factories – a blades’ factory in Windsor, a nacelles-assembly factory in Brighton and towers’ factory Pueblo, thereby better servicing and meeting the needs of Vestas’ North American customers.

“Vestas has made a deep commitment to Colorado, which is evidenced in our factories and the establishment of the Engineering Site. We are extremely committed to Colorado, and we look forward to a long, successful relationship here,” said Finn Madsen, President Vestas Technology R&D. “By co-locating engineering and design competencies with the production cluster in Colorado, the proximity of Technology R&D to manufacturing creates significant efficiencies that can be passed along as a direct benefit to our customers.”

Vestas decided to build its North American production facilities in Colorado because of the state’s central location, extensive transportation infrastructure and rail system, existing manufacturing base and skilled workforce. "

Buffs Join Pac-10

2010-07-03T09:10:00.008-06:00

(Photo from Pac-10 website http://www.pac-10.org/)

As a native Boulderite, long time Buffs fan who grew up going to CU football games and Pac-10 school alumni who holds Cal Men's Basketball season tickets to this day, I feel compelled to comment on the the recent announcement that CU will be joining the Pac-10 along with Utah to create the Pac-12.

First, a note about my recent dearth of blog entries. In May and June, both my wife and my mother were ill. Thankfully, both are doing much better now and I have the time and energy to return to blogging.

From an economic development perspective this announcement is a very positive step for Boulder and Metro Denver because it helps reinforce existing academic, scientific, geographic and cultural ties between Colorado and the West Coast of the United States where a significant degree of scientific and technological innovation occurs. To take one small example of the scientific brain power on the West Coast, the University of California at Berkeley, where I went to graduate school, is the only school that I know of that has so many Nobel Laureates on the Faculty that it dedicates a parking lot for prize winners with free parking in the center of campus. CU's affiliation with the Pac-10 schools will buttress the Metro Denver area's status as a regional "technopole" and help tie Boulder to the innovation infrastructure in Silicon Valley.

For many years Colorado has felt competing gravitational pulls between Texas and the West Coast. The New York Times once described Denver as a mix between Portland, Oregon and Houston, Texas. By taking its flagship public university into the Pac-10 (and turning away from the Texas dominated Big 12), Colorado is pointing west towards a future where global economic influence shifts to the Pacific Rim and technological innovation remains a key to economic success.

Now a bit about what all this means from a football rivalry perspective. One of the things that makes college football so compelling is continuity and the loss of the Nebraska and other Big Eight rivalries is undoubtedly a blow to tradition. I will certainly miss the annual post-thanksgiving game against the Huskers. Nebraska undoubtedly got the better of this series but CU got in a few good shots over the years (can anyone say "62-36" or "back to back Big Eight champs 1989 and 1990"?). The CU-Nebraska rivalry has always had a bit of a nasty edge to it with Nebraska partisans thinking the Buffs were not a worthy rival and CU fans smug, but accurate, sense of geographic superiority over "corn land." Things really heated up in the 1980s when Bill McCartney painted the Nebraska game in RED CAPs on the Colorado schedule and Tom Osborne treacherously cost the Buffs the 1990 UPI National Championship in the Coaches' Poll by voting for Georgia Tech.

If Nebraska had broken up the Big 12 by heading to the Big 10 and Colorado had ended up in the Mountain West due the machinations of Texas politics it would have been a final Husker insult to Colorado that would have stung for decades. In any case, Colorado now has a chance to revive a classic geographic rivalry with our new Pac-12 travel partner, the University of Utah, a budding football powerhouse. The Buffs are going to have to rev up our athletic program to compete with the Pac-10 and our new foes in Salt Lake City.

The Post's Ed Quillen On the Denver's Loss of HQ's

2010-05-09T21:10:00.002-06:00

Ed Quillen has a interesting opinion piece in the Post on Denver's loss of corporate HQs. He cites one of the most brilliant urban writers, Jane Jacobs' and her theory of important replacement as the key to a region growing its own HQ locations organically.

OpenEI: A Tremendous Resource on Renewable Energy

2010-04-25T13:05:00.004-06:00

I wanted to do a short post about OpenEI, a tremendous new resource on the renewable energy economy sponsored by the US Department of Energy and the National Renewable Energy Laboratory. The site, still in beta mode, uses Wiki collaboration to document, catalogue and analyses the renewable energy sector in the U.S. and globally.

A couple of interesting tidbits from the site:

Colorado has the second largest number of "Registered Organizations" after California
The Rockies are considered a "Clean Energy Hot Spot."

The Qwest Loss: A Quick Reaction

2010-04-25T12:45:00.004-06:00

There is no way to spin the Qwest acquisition by CenturyTel as a positive development for the Denver Region. This is depressingly bad news for the local economy. The loss of Denver's largest corporate HQ will have painful and far reaching implications.

This development once again raises the issue of why Metro Denver with its educated work force, excellent infrastructure, high quality of living, outstanding recreational and cultural amenities, tradition of good government, healthy regional cooperation and decision-making, and strong clusters of industries seems to always struggle in maintaining and attracting high profile corporate HQs. Is it the region's spatial isolation from other major business centers, relatively small population, bad luck, lack of regional dominance over any single sector, relative scarcity of certain professional and financial services (advertising agencies, accounting, investment banking, consulting), other reasons not yet identified or some combination of the above?

Whatever the cause, this is a bitter pill to swallow.

Daniel Gross On The Recovery: An Example from Colorado

2010-04-11T18:26:00.004-06:00

Financial and economic writer Daniel Gross has an insightful piece in Slate on why the U.S. economic recovery will be stronger and faster than many experts predict. Gross cites the emerging wind energy cluster in the Colorado's "Renewable Range" as an example of an emerging ecosystem which has the potential to create a huge amount of new economic activity.

"Skepticism about the potential for millions of "green jobs" to materialize
overnight is warranted. But in some areas, a process similar to the iTunes
experience is developing. The Danish wind-turbine maker Vestas in recent years
has announced investments of nearly $1 billion in wind-turbine-manufacturing
plants in Colorado, which, when completed, will directly employ about 2,500
people. But Vestas has also attracted a dozen-odd suppliers, including
components producers like Aluwind, PMC Technology, Bach Composite, and Hexcel.
And it's not just about the hardware. Renewable Energy Systems Americas, the
largest manager of wind farms, moved its corporate headquarters to Broomfield,
Colo., in 2008. Last month Colorado mandated that 30 percent of the state's
energy be produced from renewable sources by 2020. "

This is Gross' second mention of the wind energy story in Colorado, that I am aware of, so he must be tracking developments in Denver closely.

Financial Services and Technology Customer Service Jobs: A Trend in Metro Denver?

2010-04-03T09:15:00.011-06:00

One positive economic development trend which seems to be emerging is financial and technology companies like, Charles Schwab, IBM, and Intuit, locating and expanding upper end customer service call centers in the Denver region. The region's highly technically skilled labor pool, business friendly climate, relatively low cost of living (compared to places like California) and Mountain Time Zone all seem to be positive factors helping to attract these jobs. These inroads are good news for the region's economy. What would be even better for Colorado, is if the region could attract and incubate more global corporate headquarters in addition to these regional, back office operations.

Westword on DIA's Future

2010-03-14T09:42:00.004-06:00

Westword publishes an occasional excellent long form feature article on the Denver Region's future. These discussions are packed with detailed information not available in other news outlets. The latest by Alan Prendergast, "DIA Dreams," is about the future plans for the Denver Region's main airport. For a link to the Westword take on the Union Station redevelopment see my previous blog entry on Joel Warner's outstanding 2008 story.

Boulder: The New (Green and Crunchy) Peoria

2010-03-12T11:59:00.010-07:00

My beloved hometown, the eco-fabulous, natural foods and outdoor recreation mecca of Boulder, Colorado has seen its global profile raised by a couple of recent corporate announcements by international consumer brands the Mars Candy Company and Wenger, the swiss army knife maker. Boulder, it seems, has become a highly desirable test market for global brands seeking to increase their presence in the healthy living, outdoor recreation, and natural foods sectors - kind of like a green and crunchy version of that old middle American stalwart test market - Peoria, Illinois. I guess the theory is if it plays in Boulder, it will play in similar upscale demographic enclaves around the nation.

=================================================================

Press Release: Mars Chocolate North America Introduces goodnessKnows™ Luscious Snacksquares Brand to Boulder, Colo. Market

“HACKETTSTOWN, N.J. --- Mars Chocolate North America announced today the
premiere of goodnessKnows™ luscious snacksquares in Boulder, Colo.

'This area is world-famous for its emphasis on and appreciation of −
healthy living,' said Suzanne Stites, cocoa flavanol platform leader, Mars
Chocolate, North America. 'If we can get a stamp of approval from Colorado’s
discerning, health-conscious consumers, then consumers everywhere should embrace this new snack!' "

Press Release: Wenger Announces Plans For Retail Store in Boulder, CO

"February 24, 2010 — Wenger, Maker of the Genuine Swiss Army Knife, and
Established Brands International today announced plans to open its first United
States retail store, to be located on iconic Pearl Street in Boulder, Colorado.
The 3,000-square foot retail shop, scheduled to open in April, 2010 will be
situated in the heart of Boulder’s historic downtown district.

The new retail store... will be designed in a vintage, natural environment,
to reflect one of the most highly recognized outdoor brands in the world in one
of the most outdoor-centric locations within the United States. The Pearl Street
site will be the first retail outlet in the U.S. to house Wenger’s entire global
family of products and will serve as a key facility to launch new product
lines...
'Boulder provides a sense of authenticity for all things and activities
pertaining to the outdoors,' said Ron Page, CEO Established Brands
International. 'It’s a perfect fit for us.' "

=================================================================

Although the tone in the first part of this blog post was a bit bemused, this is serious business for Boulder which is uniquely positioned as an innovator in the natural and organic food and outdoor recreation industries. Boulder's long-term economic vitality depends in part on growing these segments of the local economy.

Louisville and ConocoPhillips Working Together on Campus Planning

2010-03-06T11:02:00.005-07:00

The Daily Camera reported that the Louisville Planning Commission and ConocoPhillips seem to be having a productive working relationship in planning the company's proposed research and training campus at the former StorageTek site off U.S. 36.

This project is one of the most important economic development efforts underway in the Denver Region and is critical to the growth of the region's sustainable energy cluster.

For more information about this project see the ConocoPhillips web site and these previous blog entries.

Image above from ConocoPhillips web site.

IBM's "Quiet" Layoffs in Boulder

2010-03-06T10:43:00.003-07:00

The Denver Post recently published an article about IBM layoffs in Boulder. The company has been very quiet about this "resource action" which reportedly impacted 2,800 workers across the country and all the Post deduced was that it was not a large layoff because it did not trigger Colorado state labor laws that require public disclosure about the size of the impact. IBM currently has 2,800 employees in Boulder and it is the largest private employer there.

I am wondering how this will impact the company's plans to hire 500 new customer service workers in Boulder.

Qwest Leasing Plans Not Great News for Downtown

2010-02-14T19:34:00.005-07:00

The Post reports Qwest's commitment to downtown Denver may be waning. This is not good news for economic vitality, office occupancy, rental rates, and future office tower development in downtown.

Photo from Kevin Moloney/Getty Images via www.minnestoapublicradio.org

SF Chronicle: Colorado Sends Love to Califonria Firms

2010-02-14T19:23:00.004-07:00

Colorado economic development officials are continuing efforts to woo California companies to the Centennial State according to the San Francisco Chronicle.

"It being Valentines Day, the State of Colorado is once gain sending California hearts and tlowers, this year accompanied by an official declaration from Gov. Bill Ritter that "Colorado Loves California." Tokens of affection include "Valentines Day cards and chocolates from Colorado to 500 California executives," and "20 Colorado Cupids, with bow and arrows in tow, passing out chocolates, information on Colorado and perhaps a few hugs to Californians," in downtown L.A."

Civic Choices: Post Card from Birmingham

2010-02-02T17:09:00.006-07:00

I just spent a weekend in Birmingham, the largest city in Alabama. According to locals I met, Birmingham has been hampered in its economic development by the horrible legacy of Jim Crow and also by a lack of vision and poor decision making among civic leaders. Birmingham lost out on the southern Delta Airlines hub to Atlanta due to a lack of support from local business and government officials. This helped Hartsfield Airport and metro Atlanta become regional powerhouses sucking corporate headquarters, economic activity and regional prosperity away from Birmingham. Birmingham also lost out on the SEC football championship game, which it hosted for the first two years, to Atlanta.

In contrast, the City of Denver and its citizens have made a string of public investments and good decisions. However, with a reckoning day approaching for the FasTracks project, the question is, will the region's voters and taxpayers step up to save the comprehensive region-wide network, or will the project collapse due to financial pressure and regional political squabbles and be limited to a few discrete lines? If Denver falters in its drive to improve its infrastructure and bolster its economic competitiveness, other cities are waiting in the wings, to take over Denver's role as the primary economic hub in the Intermountain West. That other Delta Airlines hub city, Salt Lake City is a serious threat.

Metro Denver must keep its forward looking vision and track record of public investment and find a way to fund the full FasTracks system and avoid the mistakes of Birmingham.

Denver Post: Colorado Companies' Get Green Job Tax Credits

2010-01-10T13:47:00.003-07:00

The Denver Post reported that six Colorado companies got green federal tax credits totaling $75.2 million: Abound Solar, Advanced Energy Industries, Coolerado Corp., ReflecTech, Hexcel Corp., Vestas Blades America Inc., and Vestas Towers America Inc.

Colorado State Spending on Higher Education: When Frugality Becomes Parsimoniousness

2010-01-03T11:12:00.007-07:00

Colorado taxpayers and voters have a well deserved reputation for frugality and keeping taxes relatively low which can be a positive factor when companies make site selection decisions. However, frugality can turn into parsimoniousness. Two recent publications I noticed have led me to think this is occurring with regard to state funding of higher education in Colorado.

1) A Denver Post article talking about CU Denver's Medical School accreditation being imperiled by the dearth of state sponsorship.

2) Colorado's ranking is 47th among the 50 states on per pupil state spending on higher education according to the Metro Denver Economic Development Corporation's Annual Report, Toward a More Competitive Colorado.

Despite the economic pressures of the current recession, public officials and voters would be well-advised to keep the long-term future in mind and raise more public funds to invest in higher education and other key infrastructure in Colorado.

PMC Technology Wind Energy Company Coming to Golden

2010-01-03T10:54:00.006-07:00

This blog entry from John Rebchook's Inside Real Estate News is a month old but its worth reading. Denmark-based wind energy component manufacturer PMC Technology is locating its North American HQ and first operations facility in Golden, near the NREL, the Colorado School of Mines and not far from Vestas, a big customer, in Brighton. The cluster grows.

See Margret Jackson's article from The Denver Post here.

500 IBM Jobs for Boulder

2009-12-23T11:40:00.004-07:00

In what is most certainly very happy holiday news for the regional Denver economy, IBM announced it is bringing 500 new customer-service-related jobs by 2014 to its Boulder campus. Given the prevalence of layoffs, outsourcing and overall downsizing in corporate America this is very good news and is a signal of IBM's ongoing commitment to its Boulder site location. IBM will receive a token contribution of $35,000 in tax rebates from the city of Boulder.

Denver in 1982: More Like Portland or Houston?

2009-11-25T16:17:00.005-07:00

I came across this fascinating assessment of the Denver Metro Region from the New York Times in 1982. It is astounding how much progress Denver has made in the last quarter century and it's truly something to be thankful for. It is interesting to see that some of our problems from the 1980s persist today. I also think the concept of "self-critical boosterism," mentioned below still has a certain degree of accuracy in describing the Denver Region today and in some ways reflects this tone of this blog.

======================================================================

HURT BY SPRAWL, DENVER FIGHTS OFF HOUSTONITIS;
An Appraisal

April 26, 1982

BYLINE: By PAUL GOLDBERGER, Special to the New York Times

SECTION: Section A; Page 12, Column 1; National Desk
\
DATELINE: DENVER

Nothing seems to frighten civic-minded residents of Denver more than the suggestion that the explosive growth of their city in the last few years has made it resemble that other energy boom town, Houston. Indeed, one senses that the people of Denver would rather hear their city by the Rockies compared to Calcutta than to the Texas city that has come to symbolize not only growth but also chaotic sprawl, overtaxed services and choking traffic.

Far from increasing confidence in laissez-faire planning, the immense growth here seems to have decreased it, making this city more nervous and less assured about its future. The mood of Denver right now seems to be skeptical chauvinism, a self-critical boosterism.

Denver is halfway between Houston and Portland, Ore., and both exert a pull on it, Houston representing a tempting but disturbing prosperity, a city of unbridled growth where real estate developers control much of the city's destiny, and Portland looking like a model of restraint, a place characterized by the Northwest's traditions of limiting growth and preserving natural resources.

Change in Three Years

Three years ago downtown Denver consisted of not much more than a few undistinguished medium-size postwar high-rise buildings, an eccentric old tower modeled after the campanile of St. Mark's Church in Venice, and the 90-year-old Brown Palace Hotel.

Now, Denver's downtown is jammed with new office buildings. Where there was eight million square feet of office space as recently as 1979; there is now 20 million square feet, and 15 million square feet is under construction. The old skyline has virtually disappeared amid a plethora of new skyscrapers; perhaps even more significant, the landscape around the city has filled with new residential and commercial construction.

But downtown Denver remains a disappointing collection of mediocre skyscrapers, different from the Denver of three years ago only in quantity, not in quality. There is little to pull the place together. And, with the exception of two recent buildings with silvery metal skins similar to the sheathing of Citicorp Center in New York, there are no buildings that seem designed specifically for Denver. Most of downtown Denver could be anywhere, even Houston.

There are some encouraging signs, however. One of them is the discontent that so many of this city's business people, architects and civic leaders feel about the direction that downtown development has taken. Denver is still small enough to make it possible for decisions to be made by a single group of powerful people, and that is more or less the intention of the Denver Partnership, an activist group fighting for better urban design.

Created 16th Street Mall

The Denver Partnership was a major force behind the creation of the 16th Street Mall, a pedestrian mall designed by I.M. Pei & Partners that is nearing completion on one of the city's main downtown streets. The mall will be managed by the group under contract to the city. The organization has also acted as an advocate for more sophisticated downtown zoning laws, which have recently been adopted.

What neither this group nor Historic Denver Inc., the city's active preservationist organization, has thus far been able to do is get a substantial amount of housing built downtown. This is beginning to change under the guidance of Liebman Ellis Melting, a New York and Denver-based architectural firm, but it remains an area in which Denver lags badly. While the city is increasingly attracting young professionals who prefer city life, there is still virtually no housing available in the center.

Nudging Up the Mountains

In some ways, however, it is already too late for Denver to avoid all the problems of Houston. While sprawl is not so pervasive here, its effects are more dramatic, for in Denver there is an extraordinary landscape to be destroyed. Miles of small suburban houses cover nothing but flat land in Houston; in Denver, they nudge their way up mountainsides, fighting the beauty of the Rockies that is the city's real heritage.

Denver's current phase of growth can be said to have begun with the completion of the headquarters of Johns-Manville in 1978, a sleek metal building on a former ranch some miles out of town. When the company moved from New York to Denver, it brought 3,000 employees with it. Though these people work in an environment with views of a pristine mountain landscape, the views out of their office windows are increasingly the only untouched ones, for the coming of so many new households led to the development of miles of mountainside land with tract housing.

The problems here are truly regional ones, and population statistics show it. The population of the city of Denver remained relatively constant at 500,000 from the 1970 to the 1980 census, while that of the surrounding counties grew 31 percent, from 1.24 million to 1.62 million.

Much of the growth comes from an influx of young professionals for whom Denver, like Houston or Washington, D.C., has become a focus of migration. But virtually the only housing constructed in recent years downtown has been some flashy condominium towers, and there are few services for full-time living downtown.

The problems of downtown Denver and the region, then, are closely connected, for as Denver expands by covering up its mountains, it also weakens the downtown it is trying to promote. Every house built at the foot of the Rockies does double damage: It takes away a part of a virgin landscape, and it saps energy from the downtown it could have strengthened.

United Health Foundation Ranking of the Healthiest States: Colorado Ranked 8th

2009-11-21T18:08:00.004-07:00

According to an annual ranking of the most and least healthy states by the United Health Foundation, as reported by Forbes, Colorado was ranked the 8th most healthy state. Mississippi was ranked the least healthy state.

See below for a summary excerpt on Colorado from the United Health Foundation website http://www.americashealthranking.org/ :

"Ranking: Colorado is 8th this year; it was 14th in 2008.

Strengths: Strengths include a low prevalence of obesity at 19.1 percent of the population, low levels of air pollution at 7.7 micrograms of fine particulate per cubic meter, few poor mental and physical health days per month at 3.0 days and 3.2 days in the previous 30 days, respectively, low rates of deaths from cancer and cardiovascular disease at 166.1 deaths and 235.1 deaths per 100,000 population, respectively, and a low rate of preventable hospitalizations with 53.7 discharges per 1,000 Medicare enrollees.

Challenges: Challenges include a high prevalence of binge drinking at 16.6 percent of the population, a high rate of uninsured population at 16.1 percent and high geographic disparity within the state at 15.8 percent.

Significant Changes: In the last year, public health funding increased from $74 to $88 per person. In the last year, the rate of deaths from cardiovascular disease declined from 247.0 to 235.1 deaths per 100,000 population. In the past five years, immunization coverage increased from 67.5 percent to 80.7 percent of children ages 19 to 35 months receiving complete immunizations. In the past ten years, the prevalence of smoking decreased from 22.8 percent to 17.6 percent of the population.

Health Disparities: In Colorado, smoking is more prevalent among non-Hispanic blacks at 25.2 percent than non-Hispanic whites at 16.5 percent. Mortality rates vary by race and ethnicity in Colorado, with 835.3 deaths per 100,000 population among blacks compared to whites, who experience 748.5 deaths per 100,000 population."

The above excerpt was from http://www.americashealthrankings.org/yearcompare/2008/2009/CO.aspx

Planning for ConocoPhillips Campus Moves Forward

2009-11-15T08:21:00.003-07:00

The Daily Camera had a lengthy article by Alicia Wallace about ConocoPhillips recent submission of its development proposal to the City of Louisville for its training and research campus at the former Storage Technology campus off U.S. 36. Plans are moving forward to build out 1.6 million square feet of space by 2013.

Colorado Fourth Happiest U.S. State

2009-11-11T18:36:00.003-07:00

According to a study based on data from the Gallup Organization's Well-Being Index, Colorado is the fourth happiest state in the U.S.

U-Haul Economics

2009-10-27T19:36:00.010-06:00

One popular way to compare the relative economic conditions between pairs of U.S. cities in the continental U.S. at any given time is to see which direction a one way U-Haul truck rental is more expensive. U-Haul rates are highly demand sensitive so the more imbalanced one way traffic is between a pair of cities, the more the rates diverge. Presumably when more people are moving from A to B, than from B to A, B has a stronger economy than A, and it costs more to rent a truck from A to B than from B to A.

I plugged a few simple scenarios in the the U-Haul website looking for quotes to/from Denver and the following three cities for a 10' truck on departing on October 30 2009: Chicago, New York and San Francisco. The results were interesting and painted a relatively favorable picture of the Denver economy.

Den to Chi: $413
Chi to Den: $1438

Den to NYC: $1333
NYC to Den: $1582

Den to SF: $744
SF to Den: $1009

Obviously this is hardly a full sample across truck sizes, days of the week, seasons, or broader time periods but it does indicate that Denver appears to be doing relatively well economically particularly compared to the Windy City.

Sunny Day in the Renewable Range

2009-10-27T18:26:00.004-06:00

A real nice piece of economic development news broke this morning in the Renewable Range.

The German company SMA Solar Technology AG, announced it will be opening a Denver manufacturing facility near Stapleton which is expected to employ 300 full time workers and hundreds more seasonally once it is fully staffed. SMA makes solar inverters--with a product lineup of Sunny Boy, Sunny Central and Sunny Island --that convert direct current generated by photovoltaic solar panels into the alternating current employed by the electric grid.

See here for SMA's press release announcing the decision.

Generating 300 manufacturing jobs within Denver city limits is a big deal, especially given the state of the U.S. economy and this announcement strengthens Colorado's claim to be an emerging green energy cluster. Each new green energy sector job win increases the probability of future wins due to the network effects of agglomeration.

The Post cites SMA's Chief Financial Officer about the reasons the company selected Metro Denver for the facility's location.

"[t]he [Denver] region's educated workforce; the site's proximity to
Interstate 70, rail and Denver International Airport; lower operating costs; and
the area's focus on renewable-energy research were behind the decision to locate
here."

According to The Post, the State of Colorado and City of Denver provided $3.6 million in economic development incentives to SMA.

In Germany, SMA is located north of Frankfurt along a high speed rail line. I am not too familiar with Germany, but I suspect the direct flights between Frankfurt and DIA really facilitated this decision.

DaVita Looking in CBD for HQ

2009-10-20T19:00:00.002-06:00

After my recent post bemoaning the dearth of major companies with HQs in downtown Denver's CBD, it is exciting that DaVita is looking in LoDo for its new HQ location.

John Rebchook's Inside Real Estate News

2009-10-11T18:39:00.003-06:00

This spring I blogged about the end of The Rocky. Recently, I have been really enjoying reading Inside Real Estate News, a blog by former Rocky business writer John Rebchook. Rebchook puts out a prodigious amount of valuable information and data about current events, economic and real estate trends and other subjects very relevant to economic development issues. It is great that John is still engaged in reporting the economic and real estate happenings in the Denver region and is sharing his knowledge, creativity and insights with us.

Denver Not Bidding for 2018 Winter Olympics

2009-10-03T13:43:00.004-06:00

Neither Denver or any other U.S. city is going to be bidding for the 2018 Winter Olympics according to the Wall Street Journal.

The Lack of Corporate HQs in Denver?

2009-09-28T17:18:00.007-06:00

With the decampment of Newmont Mining for the Denver Tech Center in late 2008 from the Wells Fargo Center in Denver's CBD and the prospect that Qwest might also abandon the central city when its lease on 1801 California Street expires in 2012, I have been pondering that perennial question about why Denver is a second or third tier headquarters city when it has a first tier labor force, airport, and lifestyle amenities?

Is it the region's spatial isolation (Denver is not in or a short drive/train ride away from any of the five major business centers in the U.S.: New York, Washington D.C., Chicago, Los Angeles or San Francisco/San Jose)?

Is the fact that the Denver/Colorado economic development authorities are not funded to deploy massive tax subsidies to attract high profile corporate headquarters?

Is it because the Denver Tech Center, Englewood, Greenwood Village, etc are such attractive locations that they drain energy from the Denver CBD?

Its probably some combination of all of the above plus other reasons I have not identified.

Whatever the reasons, there most certainly are negative economic and aesthetic repercussions for the city and the region. A lack of HQs likely reduces regional economic vibrancy and makes locally-based philanthropic activity more challenging. The lack of marque corporate headquarters has also contributed to a dearth of newly constructed high profile, signature office towers in Denver since the 1980s real estate bust. The most beautiful office towers tend to designed by and for specific corporate owners and not as speculative investments - think Lever House, the Seagram Building, the GM Building and the Chrysler Building in New York City to take a few examples.

The factors that influence headquarters siting decisions are a running theme in this blog which I plan to keep exploring in future posts.

(photo above from Wikepedia Entry on the Wells Fargo Center in Denver).

Keeping Frontier Jobs in Denver

2009-09-19T18:36:00.001-06:00

Regional officials in Colorado are putting together an economic development incentive package for Republic Airways, new owner of Frontier Airlines, in an effort to keep jobs in the Denver Region.

A Union Station Milestone

2009-09-05T09:26:00.003-06:00

Construction is ready to begin at Union Station after Labor Day. This is quite a milestone for the Denver Region.

Just in time....the Union Station project has a great new web site.

Vestas Follow Up

2009-09-02T17:03:00.003-06:00

The Denver Post has a great article on the Vestas investments in Colorado.

Graphic from The Denver Post.

HB 09-1001 Quick Successes

2009-08-16T10:51:00.008-06:00

Two of Colorado's recent successes in luring new corporate HQ to the Denver region - REpower and Davita have been at least partially ascribed to House Bill 09-1001 which was signed by Governor Ritter back on May 4, 2009.

(Photo in this blog entry is of Governor Ritter at signing ceremony on May 4, 2009 from Press Release at State of Colorado Web Site)

The bill created state income tax credits for businesses that locate in Colorado, allowing companies to apply to the nine member Colorado Economic Development Commission (CEDC) for a 3.8% credit based on payroll tax costs incurred from the newly created jobs. To be eligible, businesses must create at least 20 new jobs in urban areas or five new jobs in rural areas, and pay wages or salaries above the average in the county where they reside. The newly created jobs must be in place for at least one year before the credits get paid.

I find this new law intriguing for two reasons. First, because its been involved in the two notable successes listed above. Second, because compared to other states like New York, Colorado has traditionally been extremely parsimonious when it comes to providing tax credits and incentives to lure new businesses. This new law is a modest departure from the state's traditional economic development recipe which relies heavily on its highly educated work force, desirable quality of life, the presence of DIA, and a business friendly regulatory climate.

It will be intriguing to see if the law generates other success stories and if it leads to any retaliatory actions by competing states.

Good News...Bad News

2009-08-15T06:52:00.004-06:00

First the good news. REpower USA the wholly-owned subsidiary of a German wind power manufacturing company headquartered in Hamburg announced it is moving its HQ to downtown Denver from Portland Oregon. This is another great example of the emerging Renewable Range in Colorado which holds the promise to generate long term economic growth for the Denver Region. Its hard to know exactly when sector concentration reaches critical mass to create a self reinforcing cluster but these types of announcements show that Colorado is really making progress. Denver's geography in the center of the U.S. and the direct flights from DIA to Munich and Frankfurt clearly played key roles in the decision to move the HQ to Denver.

From the REpower Press Release 08/14/09

Steve Dayney, CEO of RePower USA

"Since 2007, we have managed our US wind energy business from a Portland, OR
office located near our initial projects in California, Oregon and Washington.
Today we are seeing our business grow rapidly to other regions of the US....To
maintain REpower’s future competitiveness and meet our customers’ needs in the
growing US marketplace, it is crucial to be strategically located and close to
all our customers and projects. Denver – centrally located, with an excellent
national and international transportation infrastructure and supportive business
climate, provides those characteristics we believe will help us succeed in
meeting our US business goals"

Now the bad news. First Data has moved its HQ back to Atlanta.

And the Winner Is....

2009-08-13T18:33:00.003-06:00

......Republic Airways...and hopefully the Denver region if they move their HQ to Colorado.

Either way keeping another competing airline at DIA is great for Colorado.

Could San Francisco's Folly Be Denver's Gain?

2009-07-11T08:31:00.008-06:00

I love San Francisco and the Bay Area. Its an amazing region full of incredible people and extraordinary places and its where I lived for more than ten years. However, its also a place where the parochial interests of the few all too frequently trump the broad interests of the many. Case in point, the recent furor over the Fisher family's generous offer to build an art museum in the Presidio to house their world class collection of contemporary art and sculpture.

To make a long story short, it looks like its not going to happen and the city where the collection will be housed could be up for grabs.

Winning this collection would be a unique opportunity to pursue Mayor Hickenlooper's vision for making Denver a cultural hub for the west. Given the Denver Art Museum's recent expansion, the Museum of Contemporary Art's new building and the upcoming opening of the Clyfford Still Museum, Denver has made great progress. Capturing the Fisher Collection would be a cap stone.

However, winning the Fisher Collection will take grand strategy, superior salespersonship, dexterity and speed plus a healthy dose of luck. San Francisco is still not out of the running and many other cities are licking their collective chops. This is an opportunity the Denver Region's political and civic leadership should pursue vigorously.

Photo above of the proposed Museum in the Presidio in San Francisco which would have housed the Fisher Collection by WRNS Studio.

FasTracks Bringing National Attention to the Denver Story

2009-07-03T19:30:00.009-06:00

FasTracks is bringing prestige and national media attention to Denver.

"This past week, Denver has been host to an annual gathering of the Congress for the New Urbanism, a nonprofit that promotes alternatives to sprawl. When it last held its conference in Denver a little more than a decade ago, few
people lived in the downtown core around the historic Union Station. Since then, Denver has embarked on a $4.7 billion expansion of its transit system, funded by a 0.4 percent sales tax increase approved by voters in 2004. The rogram,FasTracks, will add 122 miles of light rail, as well as new bus service, and is scheduled to be completed by 2017. The city is also overseeing a $1 billion redevelopment of Union Station.

Along the rail line, mixed-use communities have sprouted, such as Stapleton, a $5 billion development on the site of the former Stapleton International Airport, which closed in 1995. Shops and restaurants in downtown Denver are lively long after the workday has ended, and neighborhoods like Central Platte Valley, just northwest of downtown, are still being developed. “It’s been transformative,” said Tom Clark, executive vice president of the Metro Denver Economic Development Corporation. He anticipates 50 transit-oriented developments to be built around FasTracks over the next
decade."

Photos from Matthew Staver for The New York Times.

See full article, "New Rail Lines Spur Urban Revival," in The New York Times, June 13, 2009.

See my previous blog entry about a recent article in Slate which also mentions FasTracks.

Also see recent Denver Post article, "FasTracks Seen as Key to Denver's Repuation," from June 25, 2009, echoing this theme.

Daniel Gross in Slate on Renewable Energy in Denver

2009-06-28T16:16:00.007-06:00

Slate recently posted an interesting article by business writer Daniel Gross on the Denver Region's success in attracting a renewable energy cluster (what I refer to as the "Renewable Range").

The basic thesis of this article is that Colorado's proximity to clean energy generation opportunities in the great plains make it a natural hub for renewable energy manufacturing, research and generation.

Money quotes.

"The Mile High City occupies the high ground when it comes to clean energy—and clean living. Denver's sheer outdoorsiness can be by turns charming and infuriating. (The question "What do you do?" is likely to be answered with an outdoor activity, not a profession.) When I showed up at Gov. Bill Ritter's office, an aide was carting a bicycle rack out of the inner sanctum. And while the state's jewel of a capital may be testimony to its heritage of extraction—walls of Colorado-mined rose onyx, a dome covered in gold, and Works Progress Administration-era frescoes paying tribute to coal mining—a new Colorado is dawning. In November 2004, Denver-area citizens voted to boost sales taxes to expand the region's light-rail system, and the state's voters approved a ballot initiative mandating that utilities draw a chunk of electricity from renewable sources. The quasi-independent republic of Boulder is a capital of
composting, recycling, hybrid-driving, and general eco-fabulousness....

The Great Plains are the Saudi Arabia of wind, and the turbines—a tower can be up to 300 feet high, and each of the three blades weighs up to 7 tons—are very expensive to transport. Colorado's proximity to markets, its highly educated work force, and tax breaks drew Vestas, the Danish turbine maker. The Danes opened their first U.S. manufacturing facility in Windsor, Colo., in 2008, and have three more in the works in the state. The tower factory under construction in Pueblo will be the largest in the world. "We will be processing 200,000 metric tons of steel per year," said Hans Jefpersen, general manager of Vestas Blades America. Total capital investment: $700 million. Suppliers are following: Hexcel, an advanced carbon materials supplier based in Stamford, Conn., is setting up a 100-employee facility in Windsor."

2009-06-28T16:16:00.001-06:00

Brookings Tracks Recission and Recovery in U.S. Metro Areas: Denver in Top 40

2009-06-21T12:56:00.004-06:00

The Metropolitan Policy Program at the Brookings Institute has a program called MetroMonitor which tracks the top 100 metro areas in the United States economic performance during the recession on a quarterly basis using metrics such as unemployment rate, wages, gross metropolitan product, housing prices and bank owned real estate. Denver ranks in the second strongest 20 Metro Areas (i.e. top 40 out of 100). See here for the full report.

Source of Photo: The Brookings Institute

Western Governors' Association Report on Renewable Energy Sites

2009-06-21T12:43:00.007-06:00

The Western Governors' Association and the U.S. Department of Energy recently released a joint report describing prime locations where renewable energy could be generated in the Western U.S. including four places in Colorado. Three of the Colorado locations, located in the Eastern Plains are suited for wind energy generation and a fourth location in South Central Colorado is a potential home to solar energy generation.

Tax Incentives Played Role in DaVita Location Decision

2009-06-21T12:23:00.003-06:00

In addition to factors previously cited in DaVita's decision to move to metro Denver, The Denver Post discusses the role of state tax incentives:

Money Quote:

"A new state law was critical in the decision by the country's largest
kidney-dialysis provider to move its corporate headquarters to
Colorado...Incentives in a new law that takes effect in August "were relevant
and necessary," DaVita chief executive Kent Thiry said Wednesday at a news
conference...Thiry called the incentives the "necessary lubricant" to assist the
company with the time and financial commitments of relocation...How much
incentive money flows to DaVita "is yet to come," said Don Elliman, director of
the Colorado Office of Economic Development and International Trade.
Elliman said the law gives a state income-tax credit of 3.8 percent for up to
five years to companies if they select Colorado over competitors and create at
least 20 jobs."

Moodys Assessment of Metro Denver Commercial Real Estate Health Indicates Weakness

2009-06-13T11:04:00.007-06:00

The rating firm Moodys does a periodic report intended to measure the health of commercial real estate markets in the U.S. by metro area as part of their assessment of commercial mortgage backed securities (CMBS).

Denver's commercial real estate sector has generally been perceived in the media to be healthier than many markets across the country but the data in this report suggests this assessment should be reconsidered. Overall, Denver has a low yellow score which indicates substantial weakness. Denver is ranked 41st out of 60 major metro markets in terms of commercial real estate health. For those people employed in the Front Range's construction sector and local real estate development buffs such as myself these scores are, not surprisingly, a cause for concern.

Of course any metro wide measurement of real estate market health can mask conditions in localized sub-markets and individual sectors which should be specifically analyzed when considering any given project proposal.

First a bit about the study's methodology and then details on the Denver Region's scores. According to Moody's:

"The scores are derived using supply and demand forecasts, as well as current
market conditions and momentum. The report is based on data from
the fourth quarter of 2008"

Each real estate sector (Multifamily, Industrial, Office: Central Business District, Office: Suburban, Retail, Hotel: Full Service, and Hotel: Limited Service) is given a ranking between 0 and 100, 0 being the lowest, least healthy score.

RED=Less than 33 (Unhealthy)

YELLOW=34-66

GREEN=67 or more (Healthy)

Now the Metro Denver Results Based on Fourth Quarter 2008 Data

Clearly Moody's believes the hotel and suburban office property sectors are extremely unhealthy in Metro Denver today and unlikely to experience additional new development in the short to medium term. Even the CBD office market, which is in better supply demand balance than it was in the eighties and nineties is currently in a low yellow status. The multifamily sector is the single source of strength in Metro Denver's commercial property markets.

No one study or report should be taken as the final word in assessing something as complex and fluid as a region's commercial real estate market health but people with rosy short term assessments of the Denver property markets would be well advised to consider these results as they make short term decisions and long term plans

Full Report Name: CMBS: Red - Yellow- Green Update, First Quarter 2009 Quarterly Assessment of U.S. Property Markets, April 21, 2009.

Denver 18th Ranked North American High-Tech Metro Area

2009-06-05T20:53:00.003-06:00

See interactive data from new Milken Institute Report North America’s High-Tech Economy: The Geography of Knowledge-Based Industries. Click here for Denver specific data.

A New Fortune 500 for Metro Denver

2009-05-31T13:24:00.003-06:00

Like many Colorado loyalists, I am suffering a bit of nasty hangover from the last two games of the Nuggets-Lakers Western Conference Finals. However, it is really exciting to see that Metro Denver is gaining a new Fortune 500 headquarters. Davita Inc. is a nice fit for the region's bio sciences cluster. It will be interesting to see where they chose to locate (CBD, Tech Center, Fitzsimmons, other?).

Key Excerpts from the DaVita Press Release Announcing the Move

"The decision to select the Denver area for DaVita's corporate headquarters
was based on four critical factors:
1. The city's geographic location is ideal for a nationwide company with facilities and operations spread across nearly every state in the country;
2. The relative costs in the area are less expensive for families and companies alike;
3. Denver is widely considered to be a highly desirable place to live and work; and
4. DaVita's significant existing presence in the region provides a solid foundation upon
which the company can continue to grow.
The company expects to see millions of dollars in savings over time as a result of the change."DaVita's decision to move its headquarters is a great coup for metro Denver and the state of Colorado," said Denver Mayor John Hickenlooper. "DaVita is one of the biggest and the best in its industry. The company's decision reaffirms what we know is true about our community - that Denver is one of the best places in the nation to work and play. We are proud DaVita chose to call Colorado home."
"While Colorado families and businesses continue to struggle, we are clearly seeing
encouraging signs of economic activity - and DaVita's decision to move its
headquarters to Colorado tops the list," said Governor Bill Ritter. "Colorado's
business-friendly climate and my administration's strategy to create new jobs,
help businesses survive the downturn, and develop a highly skilled 21st century
labor pool are positioning Colorado for a strong and sustainable recovery. On
behalf of people throughout the state, we heartily welcome DaVita's Colorado
expansion and we congratulate Mayor Hickenlooper and all those who helped make
these new jobs a reality."

Bringing Back a Major Bike Race to Colorado is a Great Idea

2009-05-10T09:31:00.005-06:00

I love this idea from Lance Armstrong. This is a great way to strengthen global perceptions of the Colorado brand. Good luck Lance.

In this Coors Classic photo from left to right are Davis Phinney, Thomas Prehn, Bernard Hinault, Jacques Boyer and Greg LeMond.

Photo from http://stevetilford.com/2009/03/10/coors-classic-photo-raleigh-ad-1980s/

Green Sprouts in a Cold Environment

2009-03-26T14:56:00.008-06:00

The current recession and the resulting fall in energy prices have slowed the development of the Renewable Range's green energy economy. Despite the fact that the economy (and weather) is really cold today, Spring is coming and there are a few green sprouts appearing.

A View of the Rockies is strictly non-partisan but we support Governor Ritter's green energy policies. Click here to sign an online petition to show your support for the Governor's New Energy Agenda for 2009.

Photograph of Danish Crown Prince Frederik, second from left, Crown Princess Mary tossing shovel of dirt at Vestas' factory groundbreaking near Brighton. Colorado Governor Bill Ritter is at the right and Vestas' president, Ole Borup Jakobsen, on the left.

Photograph from Denver Post Web Site, Copyright David Zalubowski, The Associated Press.

Metro Denver Sports Commission

2009-03-24T19:06:00.005-06:00

There was an interesting article in today's Denver Post about the Metro Denver Sports Commission, its President KieAnn Brownell, the Sportaccord event, and the possibility of Denver hosting the 2022 Winter Olympics. I think the MDSC's sponsorship of the 2008 Men's College Ice Hockey Frozen Four Championship brought a really great event to Denver last year.

Money Quote:

"When she was 9 years old, KieAnn Brownell would check movies out of the
library and charge friends admission to watch. Now the self-described "serial
entrepreneur" sells Denver as a potential host for national and international
sports events, including the Winter Olympics.

As president of the Metro Denver Sports Commission, Brownell is the
city's chief host this week as hundreds of Olympic sports power brokers gather
for "Sportaccord" meetings at the Hyatt Regency Denver. Delegates include the
executive board of the International Olympic Committee.

"If there's a message we can get out, it's 'Bring your world-class
events here, we're ready for them,' " Brownell said Monday while working a lobby
swarming with delegates from around the world."

Brookings: "Miracle Mets"

2009-03-17T18:51:00.004-06:00

The Brookings Institute Metropolitan Policy Program recently published another interesting report titled "Miracle Mets: Our Fifty States Matter A Lot Less Than Our Top 100 Metro Areas," by Katz, Mauro and Bradely.

Click here for link to full paper in PDF format. This article originally appeared in the Spring 2009 issue of Democracy: A Journal of Ideas.

For a metro area in the United States, where we generally lack effective metro-wide government structures, I have always thought Metro Denver did a pretty decent job of regional coordination with important regional bodies, such as the following, impacting metro-wide policy: Metro Mayors Caucus , Denver Regional Transportation District (RTD), Denver Regional Council of Governments (DRCOG), the Scientific and Cultural Facilities District (SCFD), the Denver Metro Chamber of Commerce, The Metro Denver Economic Development Corporation, the Metro Denver Sports Commission, and many others.

Its notable how often the terms "metro" or "region" are used in the titles of the organizations listed above which shows that the region recognizes and values the importance of metro-wide organization and cooperation. As an aside, I think this ethos evolved in part because of the Denver region's spatial isolation from other metropolitan areas which fostered the need for regional bootstrapping and self reliance.

In this context I thought it was interesting that the Brookings' paper cited FasTracks in Denver as an example of successful regional coordination.

"Of course, metropolitan-area leaders have no alternative but to try to
succeed, and many are working creatively and energetically to tackle big
problems and augment their regions’ stocks of crucial assets. In Denver, the
metropolitan mayors’ caucus spearheaded a $5 billion bond issue for transit
and changed local zoning laws to create the density that makes transit
successful."

Lets hope the region is able to pull together once again to develop a strategy and the political consensus for financing the full FasTracks build out by 2017 as planned.

Regionalism in Denver is something I hope to explore further in future blog posts.

See below for an extended summary of the paper from the Brookings Website :

"Though our economic development policies don’t reflect it, America doesn’t
really possess a national economy, or even a collection of 50 state economies.
Instead, America’s long-term prosperity stands or falls on the more local
prosperity of its 363 distinct, varied, clustered, and interlinked metropolitan
economies, dominated by the 100 largest metros—many of which cross county and
state jurisdictions and incorporate multiple city centers, suburbs, exurbs, and
downtowns in a way that the old hub-and-spoke model of urban geography never
did. In that sense, America is quite literally a “MetroNation,” utterly
dependent on the success of its metropolitan hubs.

From the hundreds of square miles that constitute contemporary London to
the sprawling Brazilian city-states of Sao Paulo and Rio, metros are the new
norm in global economic development, shaped by twenty-first-century forces of
globalization, innovation, and cultural diversity. These forces assign enormous
value to a relatively small number of factors—infrastructure networks,
industrial innovation, human capital, the quality of place—and then reward those
nations and places that are best able to marshal and align those assets. And
those places are, increasingly, metros—pulsating zones of urban, suburban, and
exurban synergies and exchange that revolve around cities. Metros—and not only
their constituent individual cities, suburbs, or isolated municipalities—are
therefore one of the most critical places where federal policymakers should
focus their attention and resources as they seek to restore prosperity to our
nation.

Yet here is the problem: While America is more metropolitan than ever, the
nation’s policies and structures rarely match economic reality. As a nation, we
remain fixed in old arrangements, established decades ago and kept in place by
bureaucratic inertia and entrenched political interests. Such a misunderstanding
of contemporary urban structures inevitably leads to bad public policy
decisions. Take as an example the nation’s crumbling infrastructure, now finally
in the public eye. We should be spending money on metropolitan infrastructure,
such as new transit lines or the maintenance and upgrade of existing roads and
bridges, because it gives the best return on investment, the most bang for the
buck. And yet the federal government sends the overwhelming bulk of national
infrastructure funds to states, not metros. Given the vagaries of state
politics, state departments of transportation in turn tend to scant metro
investments in favor of building brand-new roads in far-flung places. Money that
could be fueling the metro economic engine ends up widening a rural highway.

We can no longer afford this mismatch. As the nation gathers its energies
to emerge from the current rattling recession, President Barack Obama and
Congress need to re-imagine the relationships between the federal government,
states, and localities to more fully realize the potential of metropolitan
America. Washington must lead in areas that transcend the reach of local action
and require national vision, direction, and purpose—areas such as the provision
of world class interstate road and rail links, investments in science and basic
research, immigration reform, and the creation of a framework for controlling
greenhouse gas emissions. At the same time, Washington needs to get past its
focus on states and empower metro areas—often made up of dozens of independent
governments— to work closer together and begin asserting themselves as coherent,
if widespread, entities. And finally, Washington and all levels of government
need to maximize their performance by deploying information, standards-setting,
and data to improve decision-making and problem-solving.

America can no longer pretend that it is a single economy, nor can it
imagine that it is a nation of independent, small towns, punctuated by large but
isolated urban centers. It must embrace its metropolitan future—and all the
wrenching change that entails."

What the Loss of the Rocky Means to Me

2009-03-07T10:28:00.007-07:00

Like many people with ties to Colorado and the Metro Denver Area, over the last week or so I have been thinking about what the demise of The Rocky Mountain News means.

Clearly the elimination of jobs and economic activity is very painful particularly given the overall state of the economy. The broad civic loss of an independent and vigorous source of regional news will be felt immediately and for coming decades. The break in 150 years of historical continuity is like a sharp knife to Denver's soul.

As a blogger living in the New York City area but writing about economic development in Denver, The Rocky provided a tremendous news source for me, sparking and informing many of my blog posts (best wishes in future endeavors Rebchook, Milstead, Reuteman and team). Ironically the very same Internet which made my blogging possible, led to structural economic changes which are contributing to the loss of so many newspapers, including The Rocky, around the country.

One of the things which makes the City of Denver and the surrounding area so special is its status as a regional metropole -- a political, cultural, economic and financial capital for the intermountain western United States. The newspapers' very name - "The Rocky Mountain News" was emblematic of Denver's claim to regional supremacy.

The Rocky's presence along with The Denver Post brought prestige to Denver making it, by my reckoning, the smallest of the remaining two newspaper towns in America. For many decades the two papers fought a legendary news war providing competing perspectives, promotional prices, spurring each other on to journalistic achievements, and helping to inform and entertain the citizenry. When a truce was called in 2001 and the two papers signed a joint operating agreement and combined their business operations, they still maintained separate newsrooms and editorial views.

Denver, the United States and most places around the world are going through a very serve economic downturn which is destroying well-loved institutions and traditions, dislocating millions of people and enveloping many facets of peoples lives with painful uncertainty. However, with this type of crisis comes changes and the seeds of new opportunity. Its hard to know exactly how and when that opportunity will unfold but I am hopeful that the Denver Region is well positioned to embrace the changes and ultimately thrive in the new reality -- its just a darn shame that The Rocky won't be around to keep us informed along the way.

Hexcel Ground Breaking

2009-02-21T20:57:00.004-07:00

From The Denver Post:

"Economic incentives and Colorado's mountain vistas held no sway in persuading Hexcel Corp. to build a new manufacturing plant in Windsor.
'We are here because our biggest customer, Vestas, is here,' David Berges, chief executive and chairman of the Stamford, Conn., company told a crowd gathered Thursday at the Great Western Industrial Park, where the company held a ceremonial groundbreaking for a new 100,000-square-foot facility."

From Hexcel Press Release

"Hexcel announced on December 10th 2008 that Windsor, Colorado would be the location for their new prepreg manufacturing plant to serve the North American wind energy industry. Since then, great progress has been made with the construction of the new facility. Foundations have already been laid for the 100,000 square foot building, and exterior concrete walls were erected earlier this month. Hexcel expects production to begin at the new plant in the second half of 2009.

Hexcel selected Windsor as the location for the plant due to the close proximity of Vestas Wind Systems, who will be a major customer for prepregs manufactured at the facility. Hexcel and Vestas pioneered the use of prepreg in wind turbine blades over a decade ago and the strong, lightweight materials have been a major contributor in the growth of blades to today’s epic proportions."

Link to earlier blog post on the Hexcel announcement

Link to Recent Union Station Design Presentation

2009-02-15T14:57:00.004-07:00

If you are like me and eagerly following the progress of the Union Station redevelopment project you will be very interested to see a recently released "Design Presentation"which provides new details on the transit infrastructure, architecture and public spaces being planned for Union Station.

Image from Scott L. Robertson, www.slrobertson.com

Richard Florida: How the Crash Will Reshape America

2009-02-14T11:57:00.004-07:00

The Atlantic Cover story by Richard Florida: "How the Crash Will Reshape America" is full of the authors' fascinating insights about economic geography and regional development patterns in the context of the current economic and financial crisis.

“No place in the United States is likely to escape a long and deep recession. Nonetheless, as the crisis continues to spread outward from New York, through industrial centers like Detroit, and into the Sun Belt, it will undoubtedly settle much more heavily on some places than on others. Some cities and regions will eventually spring back stronger than before. Others may never come back at all. As the crisis deepens, it will permanently and profoundly alter the country’s economic landscape. I believe it marks the end of a chapter in American economic history, and indeed, the end of a whole way of life.”

Florida does not deal specifically with the Denver Region in the text of the story, instead focusing more attention on places like New York, the Rust Belt and California, but many of his insights are very relevant for the Front Range.

"In fact, as I described in an earlier article for this magazine (“The World Is Spiky,” October 2005 [link opens PDF]), place still matters in the modern economy—and the competitive advantage of the world’s most successful city-regions seems to be growing, not shrinking. To understand how the current crisis is likely to affect different places in the United States, it’s important to understand the forces that have been slowly remaking our economic landscape for a generation or more....

The ability of different cities and regions to attract highly educated people—or human capital—has diverged, according to research by the Harvard economists Edward Glaeser and Christopher Berry, among others. Thirty years ago, educational attainment was spread relatively uniformly throughout the country, but that’s no longer the case. Cities like Seattle, San Francisco, Austin, Raleigh, and Boston now have two or three times the concentration of college graduates of Akron or Buffalo. Among people with postgraduate degrees, the disparities are wider still. The geographic sorting of people by ability and educational attainment, on this scale, is unprecedented. "

The interactive maps showing different aspects of economic geography such as patent production, income and population are fascinating and worth exploring. They help reinforce two of the Denver Region's two key characteristics: its spatial isolation and economic vitality. Its particularly striking to see how potent, the Front Range's two college towns, Boulder and Fort Collins have been as patent generators. This clearly bodes well for the region's future economic health.

Pew Research Cites Denver as "Favorite City"

2009-01-31T09:47:00.005-07:00

Pew Research recently released a national survey which named Denver as the most popular big city in the country. Click here for summary and here for full report.

According to Pew:

"A new national survey by the Pew Research Center's Social & Demographic Trends project finds that nearly half (46%) of the public would rather live in a different type of community from the one they're living in now -- a sentiment that is most prevalent among city dwellers. When asked about specific metropolitan areas where they would like to live, respondents rank Denver, San Diego and Seattle at the top of a list of 30 cities, and Detroit, Cleveland and Cincinnati at the bottom.....These findings emerge from a wide-ranging telephone survey of a nationally representative sample of 2,260 adults, conducted Oct. 3-19, 2008."

I wonder how much Denver's results were influenced by the 2008 Democratic Convention which happened just a few months earlier. Being named the number one favorite city is a positive indicator of the Denver area's ability to attract top labor market talent and employers. It will be interesting to see how Denver fares in follow up surveys in subsequent years.

The New York Times on the Denver Real Estate Market

2009-01-26T19:51:00.004-07:00

This New York Times story about the Denver real estate market and regional economy is a few weeks old, from January 6, 2009, but interesting nonetheless. The money quote:

"A number of elements are cited as keeping this region afloat as other areas
founder: investments in public transportation, aggressive economic development
and, most significant, a two-decade campaign to diversify the region’s economic
base from oil and gas to alternative energy, aerospace, technology and
telecommunications. As a result, said Scott Anderson, a Wells
Fargo economist who also spoke to the assembly, Denver and its region are
“in for a more mild recession” than the rest of the country."

Windsor Wind Cluster

2009-01-24T09:03:00.003-07:00

More details about the agglomeration effects in Windsor due to the Vestas location decision.

From the Rocky Mountain News

"When Vestas announced two years ago that it would build giant wind turbine blades in Windsor, economic development officials predicted that other companies would follow.That is essentially what has happened with the arrival of Hexcel Corp., said Martin Shields, a regional economist at Colorado State University. Hexcel makes a high-performance material used in the manufacture of wind turbine blades. The Stamford Conn.-based company is investing $50 million in a new manufacturing facility about 1,000 feet from the Vestas wind plant. Hexcel will initially create about 100 jobs, and is joining Vestas as a tenant in the Great Western Industrial Park."

Is Colorado a Renewable Energy Hub?

2009-01-18T09:03:00.007-07:00

One of the overriding themes of this blog has been the importance to Colorado and the Denver Region's economic health of seizing the moment and becoming a center for the emerging renewable energy sectors. Up until now I have not seen any data which allows us to measure the region's progress in this regard.

The recently released report by the American Solar Energy Society, "Defining, Estimating, and Forecasting The Renewable Energy and Energy Efficiency Industries in the U.S. and Colorado," provides useful data
for understanding if Colorado is succeeding in becoming a green energy hub. According to this report as of 2007 Colorado had 91,285 renewable energy and energy efficiency jobs (10,075 in just renewable energy). In the U.S. as a whole there were 504,000 renewable energy jobs and 9.09 million total renewable and efficiency jobs.

By combining this data on renewable jobs in Colorado and the U.S. with overall data on Colorado and U.S. employment as of December 2007 (138 million and 2.3 millon non-farm jobs in the U.S. and Colorado respectively) its possible to calculate a location quotient(LQ) which shows the concentration of renewable jobs in Colorado.

One way to think about the LQ is it measures the ratio of a state's share of total national jobs in a specific industry to that state's share of total national jobs. So a LQ>1 indicates the state has a greater share of jobs in a specific economic sector than its population would otherwise warrant which means the state is a net "exporter" of the products and services produced by that sector to the rest of the nation (or world). Detroit has a high LQ in automobile manufacturing (at least for now), California has a high LQ for film production, New York in financial services, etc. So a LQ>1 means an area could be a hub or cluster for a given economic sector. Obviously having a high LQ in a growing sector is a good thing for a region's economic health but having a high LQ in a shrinking sector can be disastrous.

Based on the data cited above, Colorado had a LQ of 1.18 in renewable energy jobs in 2007. Given the string of positive job announcements in early 2008 in Colorado in the renewable sector, it seems likely to me that this ratio may have grown in 2008. However, a LQ of 1.18 only indicates a moderate level of concentration and it means Colorado has a long way to go before establishing itself as a primary alternative energy hub and there is likely to be fierce competition from other areas of the country to obtain this status.

(Photos courtesy of the National Renewable Energy Laboratory, All Rights Reserved)

Schwab Jobs

2009-01-17T18:26:00.003-07:00

The long awaited expansion of Charles Schwab's presence in Colorado was formally announced on Friday. As reported in the Denver Post, the brokerage company is adding 500 IT jobs in Douglas County and is receiving a reported $1 million incentive from the state to facilitate this expansion. Given the severe economic contraction impacting the U.S. and the Denver region, this is welcome news indeed.

It Must Be Boulder

2009-01-05T17:43:00.004-07:00

If the nine companies to watch in 2009 include alternative energy, organic products, computer hardware and software and colorful, rubber footwear companies--it must be the county where I was born - Boulder (and Broomfield). The Daily Camera had an interesting article in its business section titled "Nine to Watch in 09" about the likely comings and goings at key local employers.

The nine companies profiled included: ConocoPhillips, Crocs Inc., DigitalGlobe Inc., Level 3 Communications Inc., Pangea Organics, Rally Software, Range Fuels Inc., Siemens Energy, and Sun Microsystems Inc.

For me the most interesting tidbit was that Siemens Energy is putting its wind turbine research center in Boulder - obviously a great boost to the local alternative energy cluster and an announcement I had missed this past summer.

"Siemens Energy in June announced plans to establish a couple-thousand-square-foot facility where employees will focus on atmospheric science research, aerodynamic blade design, structural dynamics and wind turbine dispatch prediction and reliability. The company since has started settling into a 5,300-square-foot space in downtown Boulder, at 1050 Walnut St.

Siemens expects to employ about 60 people here eventually, and officials from the local municipal and scientific communities say the arrival could further boost Boulder County's position in the growing renewable energy industry. In the coming months, locals could get a taste of what Siemens' presence means, both in terms of new jobs, but also potentially new partnerships with area labs."

Declining Auto Travel and Promoting Pedestrian Lifestyles

2008-12-19T15:50:00.007-07:00

Although we have had a reprieve in high gas prices, the Brookings Institution makes a compelling case that people are starting to make permanent lifestyle changes that are leading them to drive fewer miles. See ,The Road…Less Traveled: An Analysis of Vehicle Miles Traveled Trends in the U.S. This figure was particularly striking, showing the correlation between rising gas prices and a drop in vehicle miles traveled per capita (VMTPC).

According to the report, Metro Denver has the 25th highest vehicle miles traveled per capita -6409 - of the 100 largest metro areas in the U.S. The city with the highest number was Jackson, MS with 8182 VMTPC and the city with the lowest number was, not surprisingly, New York with 3657.

The video below by Robert Puentes at Brookings explains the public policy implications of driving less. Among other ideas, Puentes thinks the Obama transportation stimulus package should be careful not to build highways to nowhere and instead make sure to fund important public transportation projects.

The decrease in VMTPC opens up an opportunity for promoting healthy, pedestrian friendly lifestyles. Denver urban enthusiast Ken Schroeppel, recently posted a blog entry on www.denverinfill.com talking about the economic, community building, public health and transportation importance of encouraging pedestrian transit in downtown Denver with links to the Downtown Denver Partnership's Leadership Program's report "Putting Our Best Foot Forward: Enhancing Downtown Denver's Pedestrian Environment."

Is it possible that multiple trends are converging - federal stimulus investment in transportation infrastructure, the prospect of higher energy prices, traffic congestion, a desire to reduce carbon generation, a change in aesthetic tastes favoring an urban lifestyle - which will lead to major changes in the built environment and people's lifestyles? Lets hope so.

Agglomeration Economies Help the Cluster Spread

2008-12-06T20:26:00.003-07:00

Once an industry, like wind power, gets established in a given geographic area, up and downstream participants get drawn into the area by the positive externalities of being located near suppliers, competitors, workers and related service providers. This is clearly starting to happen in Colorado for various sub sectors in the alternative energy ecosystem.

This from The Denver Post.

"WINDSOR — Aerospace products maker Hexcel Corp. plans to open a plant in Windsor next year.
The company supplies Vestas Wind Systems with composite materials that are used to make wind turbines. Hexcel will open its plant near Vestas' blade-making plant in Windsor, about 50 miles north of Denver.
Construction of Hexcel's plant is expected to begin this month and the plant should open late next year.
Hexcel chairman and CEO Dave Berges says demand for wind turbines is expected to grow now that 30 states have pushed utilities to use more renewable energy.
The Stamford-Conn.-based company hasn't announced any details about how many new jobs the plant will bring."

The FasTracks I-225 Intra-Suburban Beltway Corridor

2008-12-04T20:47:00.015-07:00

The issues surrounding the proposed Purple Line on the Washington D.C. subway system are very relevant for FasTracks. See below for an extended excerpt from an article titled "Greening the Suburbs" from The New Republic's environmental blog, The Vine.

The Purple Line in Maryland would be the first intra-suburban rail transit line in the D.C. system because it would not carry people from the suburbs to the city center in a hub-spoke model but instead would follow the beltway around the city carrying people between the suburbs. The purple line provides connectivity between the spoke lines near the perimeter of the system allowing for transfers to occur away from the city center.

In the FasTracks system, the analogous line is the I-225 Corridor which will connect the Southeast and East Corridors together and make it easier for Southeast riders to travel to DIA as well as serving new destinations in Aurora. This line is an intra-suburban beltway line like the purple line in D.C.

Some of the proposed solutions to the FasTracks budget deficit involve shortening the I-225 Corridor including not completing loop and terminating the line before the connection to the East Corridor at the Peoria/Smith Station. As I have said in previous posts, I believe any cuts to the FasTracks system including the I-225 line would be a huge mistake.

Excerpt from "Greening the Suburbs:"

"The logic undergirding the Purple Line is that D.C.'s Metro, like most old-school subways, is a hub-and-spoke model, built for an era when people lived in the suburbs and commuted downtown for work. Nowadays, though, most traffic flows from suburb to suburb—hence the need to interlink Montgomery County and Prince George's County. Most area residents favor some sort of connecting line; the bickering is over the details. Marc Elrich, a Montgomery County councilman, explained that he was agonizing about whether Maryland should spend $1.2 billion on a fixed light-rail system projected to transport 64,000 people per day, or spend just $600 million on a bus rapid transit (BRT) system with a dedicated lane, projected to transport 58,000, and use the savings for other worthwhile initiatives.

Chris Leinberger, a Brookings expert on development who comes at things from a real-estate perspective, countered that Elrich was approaching this too narrowly. Leinberger argued that transportation tends to drive development, and that transit projects should be viewed as a means of creating new value in a metro area. In that vein, he argued that middle-class people like trains well enough, but often refuse to ride buses, which carry the stigma of poverty; as a result, developers are much more likely to invest around rail stations than bus stops. (This may not be an ironclad law, but, alas, the United States has relatively few examples of successful BRT, a la the famous system in Curitiba, Brazil).

What's more, Leinberger assured the audience, developers will flutter to new light-rail stops in droves, because there's colossal pent-up demand in this country for transit-oriented development. By his count, some 30 to 50 percent of residents in U.S. metropolitan areas want to live in a walkable urban environment—a trend fueled by the growing number of single and childless couples, who will constitute 88 percent of household growth through 2040. Trouble is, he estimates there are currently only enough walkable neighborhoods to satisfy about 5 to 10 percent of metro residents, which is why rents in transit-accessible areas are so exorbitant. (Incidentally, the boom in childless households is one reason why development in D.C. could start to expand beyond Montgomery County and toward the northeastern suburbs, which have long been hampered by relatively inferior schools.)

Of course, to fix all this, new rail lines alone won't suffice. The towns around the proposed stops will have to revamp their zoning codes to allow high-density development near train stations—a suggestion that's typically greeted by angry, pitchfork-wielding mobs. (Ryan Avent recently dredged up a perfect example.) Now, since these changes in land use can both reduce greenhouse-gas emissions and bring down the cost of housing, Leinberger argued that environmentalists and social-justice activists should be at the forefront here. "Instead," he said, "you've just been leaving it up to developers—and no one seems to trust us!" Not that developers will ever be irrelevant: One interesting point Leinberger made was that if transit really does create the sort of value he expects, then real-estate developers should be more willing to pitch in and help finance these projects."

Governor Ritter on The News Hour

2008-12-02T20:23:00.006-07:00

"Think in a state like Colorado, it's got 5 million people, but we have, again, 100-plus projects that we could have shovels in the ground in 90 days. And if you infuse our economy with, let's say, $500 million worth of transportation projects in 30 to 180 days, that puts people to work in a sector that has suffered.
And think about that nationwide. Gov. Schwarzenegger today said there are $136 billion worth of highway projects that are on the shelf that we could immediately change around, right, we could put shovels in the ground in 90 to 120 days.
Add to that clean-energy jobs. Think about wind farms and solar farms. The manufacturing end of that, you can create jobs on the manufacturing end of that in a whole new industry by investing in that industry and by really doing things with the stimulus package that don't cost money, other than through tax credit and ways to incentivize people to get into the industry."

Governor Bill Ritter on The News Hour, December 2, 2008. Click here for the full transcript.

I keep wondering if a combination of the recent sharp declines in commodities prices and the prospect of incremental infrastructure funds from an Obama Administration will end up solving the FasTracks budget shortfall? Its probably a long shot but one can hope.

Image from www.pbs.org.

Progress Report on Colorado Officials' Asia Trip

2008-11-27T18:57:00.003-07:00

The Rocky Mountain News had an interesting wrap up of Governor Ritter and other Colorado officials' trip to Asia.

"PROGRESS REPORT

The delegation to Asia said it made progress on several fronts, though no major business deals were signed during the trip. Some highlights:

* Colorado State University signed four agreements to collaborate with research institutions in China and Japan.

* Colorado promoted its renewable energy, tourism and biosciences industry.

* All Nippon Airways said Denver is in the running for a nonstop flight to Tokyo, with service starting as early as 2010."

Happy 150th Denver

2008-11-23T12:15:00.003-07:00

Both The Rocky and The Post have excellent special sections commemorating the 150th anniversary of the City of Denver. Happy Birthday Denver.

ConocoPhillips Delay

2008-11-23T11:58:00.004-07:00

Given the state of the economy and the drop in fuel prices, its not surprising that ConocoPhillips has pushed out the opening of its Louisville campus and scaled back some of its alternative energy investment plans. Lets hope this is only a temporary delay and not a permanent change in strategy. Even a short-term delay will have negative effects on the local economy and hurt the chances of some of the proposed nearby hotel and office developments.

United to Renew Denver to London Daily Flight

2008-11-18T20:08:00.003-07:00

Thankfully, not all of the news out of DIA these days is about turbulence and retrenchment. United Airlines is planning to restart the Denver to London flight next spring.

NREL Expansion Plans

2008-11-15T10:50:00.005-07:00

The National Renewable Energy Laboratory (NREL), a key component of the Denver region's green energy cluster, plans to grow its operations in Golden substantially as detailed in The Rocky Mountain News.

NREL Director, Dan Arvizu recently gave a presentation to congressional staffers on the role of the lab and its future plans which includes an Aerial view of what the NREL Golden campus would look like when it is fully built out. Go here to view the presentation.

Photo above is a 2007 aerial view of NREL campus. Courtesy of DOE/NREL, Credit - Patrick Corkery.

Governor Ritter Headed to Asia

2008-11-12T16:15:00.004-07:00

Governor Ritter is headed to China and Japan to help promote Colorado as a renewable energy and bioscience hub and to lobby All Nippon Airways for a direct flight between Tokyo and Denver. Increasing Colorado's global ties is a worthy endeavor, which could lead to long-term economic benefits, even though its probably an uphill battle in the short term given today's economic environment.

This trip has been well covered by the two major Denver daily papers.

According to the November 10, Denver Post

"Colorado Gov. Bill Ritter will lead a 40-person delegation to Japan and China departing Saturday to promote direct Tokyo-Denver flights and other economic ties.
Joining Ritter on the 10-day trip will be officials from the Colorado Office of Economic Development and International Trade, the Denver Metro Chamber of Commerce, the National Renewable Energy Laboratory and Colorado State University."

See the Rocky Mountain News from November 11.

"Gov. Bill Ritter will lead a trade mission bound for Japan and China this weekend in hopes of securing a daily nonstop flight between Tokyo and Denver and to promote Colorado as a renewable energy and biosciences research hub.

The mission follows a handful of trips in recent months by economic development and tourism officials attempting to increase Colorado's visibility in Asia - and the state's chances of being chosen by All Nippon Airways for a direct flight from Tokyo."

An earlier blog entry describes the "Ascent to Asia" campaign to achieve a non-stop flight from Denver to Asia.

Summary of Possible Obama Energy Plans

2008-11-08T07:12:00.003-07:00

The R-Squared Energy Blog provides an interesting high level summary of possible Obama energy plans. These plans could have a big impact on the Denver region.

What Will the Obama Administration Mean for Colorado?

2008-11-05T15:45:00.005-07:00

After the historic presidential election yesterday, I got to wondering how an Obama Administration will impact economic development in Colorado. Given the central role that Colorado's electoral votes played in last night's Obama victory coalition and the fact that Colorado is likely to remain a battleground state in future elections, the state is well poised to benefit from the incoming administration. Some of the intriguing questions which popped into my mind include:

Will any Colorado political figures - Pena, Ritter, etc - play prominent roles in the Obama administration?
How much will Colorado benefit from Obama's plans to invest $15 billion a year in alternative energy development?
Will a new Obama stimulus package include the infrastructure investments he has hinted at? How much will flow to Colorado? Could some of the FasTracks deficits be ameliorated by new federal infrastructure funds?

Short Term Turbulence for DIA

2008-10-31T17:21:00.007-06:00

Happy Halloween. It has been a truly ghoulish month for the economy.

(photo provided courtesy of Denver International Airport)

One of the central themes of this blog is that Denver International Airport (DIA) serves as a powerful economic engine for the Denver Region and Colorado. However, as jet fuel costs have increased, airlines have scaled back their flights and the U.S. macro economy declined, it has been a tough stretch for DIA and other airports around the country.

1) Frontier entered bankruptcy and reduced its flight schedule.

2) DIA's international ambitions have been curtailed, at least temporarily, as Lufthansa has ended its daily non-stop flight between Munich and Denver and United ends its daily non-stop service between Denver and London. British Airways will continue to fly the Denver to London route and Lufthansa will provide daily non-stop service between Denver and Frankfurt.

3) DIA has put its plans to expand Concourse C on hold in anticipation of declining flights and passengers as airlines cut back their routes. Additionally, the construction of an airport hotel will likely be delayed and/or scaled back.

Despite these developments, there are still reasons to be sanguine about the airport's prospects. First, DIA has achieved record monthly air volumes in 2008 including breaking the 5 million passengers per month threshold for the first time ever in July. Southwest continues to expand its flights at and destinations served from DIA. Also, to date, the airport has not lost any major hub carriers unlike some other airports around the country. Recently DIA's bond's have been given strong ratings indicating the airport is financially well positioned to weather the current turbulence.

In the long term, as the broader U.S. economy improves, I believe DIA will continue to be a powerful economic growth driver for the region and the airport will resume its upward financial and operational trajectory.

Venture Capital & Hotel Development Funds Driven by Green Energy in Colorado

2008-10-19T17:53:00.007-06:00

The impact of the credit crunch and the likely recession is slowing down capital flows, job creation, real estate development and many other positive economic development indicators in the Denver Region and around the U.S. However, among the gloom, I have noticed two related positive trends, recently reported in the Boulder Daily Camera which link back to the emerging green energy cluster in Metro Denver.

First, there appears to be a wave of hotel development forming which will hit the U.S. 36 Corridor in Broomfield sparked by the ConocoPhillips plans for the former Storage Tech site. Despite the fact that the hotel business is one of the most cyclical sectors of the real estate market which tracks very closely with the macro economy, there are as many as eight different hotel projects in various stages of planning in this area. These plans are clearly driven by the large number of business travelers who are expected to come to the Interlocken area as part of the ConocoPhillips international training and alternative energy research facilities.

Second, despite a national downturn in venture capital deals, compared to the third quarter of last year, Colorado either held steady or increased its flow of funds according to two reports cited in the Camera. This was due to investments in alternative energy companies such as AVA Solar Inc. with operations in the state.

A View of the Rockies believes the development of renewable energy will change the U.S. economy as profoundly as the emergence of the Internet or the railroad network did in the previous times. It won't be an easy transition and its hard to predict when critical mass will be reached and the changes will ramp up to full effect. However, when the green energy revolution does come, it will dramatically boost the economic wealth and power of the cities and regions that play host to this sector.

In the immediate term, the U.S. economy appears to be headed for lean economic times with contractions occurring in many sectors of the economy. However, the Denver Region can outperform the U.S. as a whole if it can continue to build an alternative energy economy. In the longer term, the development of this sector holds transformative possibilities for Colorado.

Rebchook Reprints Marilee Utter

2008-10-04T08:37:00.003-06:00

John Rebchoock's October 1 Rocky column is an article by Marilee Utter which contains a lot of wisdom.

"By curtailing sprawl and sharing facilities regional and local jurisdictions can create affordable infrastructure. This infrastructure includes water, wastewater treatment, roads, transit, power, emergency services, snow removal, schools, fire and safety departments and more. The end of suburban sprawl cuts government service operating costs by 25 - 40+% because there is less physical area to maintain and service.There are many descriptive phrases: 'cluster zoning'; 'connected communities'; 'new ruralism'; 'new urbanism'; 'transit villages'. What it all comes down to is creating compact development in circumscribed areas while devoting a great majority of land to open space that can be used for active and passive recreation. But, what we aim for in 'connected communities' (to use one phrase) is to have a range of housing that goes well beyond the single-family model."

The FasTracks Dilemma: Increasing Sales Taxes is the Right Solution

2008-09-28T17:37:00.005-06:00

The Denver Region's ambitious public transit build out has run into financial difficulties. Due to escalating construction and right of way acquisition costs, the price tag for building out the current system has increased by almost $2 billion to $7.9 billion. Additionally sales tax revenues which are financing the system have been below forecasts due to the sluggish economy. If the system is to be built as planned by 2017, additional money will need to be raised. Otherwise the system will be scaled back or delayed.

Since the vote approving FasTracks in 2004, two other things have changed as well. First, gas prices have more than doubled from just under $2 per gallon to just under $4 per gallon with further increases likely to occur. Second, the urgency of reducing carbon emissions to stave off global warning has become increasingly clear.

The tax payers of the Denver Region have a right to be angry about the escalating price tag associated with the FasTrack system but at the same time its important to understand that the same factors which are driving up the cost of the system are increasing the economic value of public transportation. Denver needs the full FasTrack system now more than ever.

Cuts in the system would have adverse long-term implications: harming the region's economic competitiveness, reducing the value of the portions of the system that do get built due to a loss of interconnectivity, and slowing the region's embrace of denser, transit oriented real estate development.

Its worth noting that construction costs for many critically-needed large scale infrastructure projects grow beyond initial forecasts as was the case with DIA. However, RTD's track record in previous projects has been largely successful in keeping projects within planned time and budget commitments.

As painful as additional tax increases are, in this instance, they are the right public policy action to provide a better future for citizens of the Denver Area. It will be a tough sell to Colorado's frugal voters, but sales taxes should be increased by an additional .2 to .3 percent beyond the current 1 percent rate being used to fund FasTracks. This will support building out the full system on schedule by 2017.

Denver 2018?

2008-09-28T17:24:00.003-06:00

Today's Denver Post outlines preliminary discussions about Denver making a bid to host the 2018 Winter Olympics. One of the civic characteristics I have always admired about the Denver Region is its aspirational nature. The region seems to be at its best when it is pursuing an exciting long-term goal. I think that this is an interesting and worthy endeavor loaded with economic development potential. Perhaps this could be the catalyst needed to invest in public transportation linkages between the Denver Metro Area and the mountain resorts.

Denver Ranked 11th Most Sustainable City by Sustainlane.com

2008-09-23T16:19:00.005-06:00

Image to the left from Sustainlane.com, all rights reserved.

Sustainlane, the online guide to sustainability, just released its 2008 sustainability rankings of the 50 largest cities in the U.S. Denver was ranked 11th behind Portland, San Francisco, Seattle, Chicago, New York, Boston, Minneapolis, Philadelphia, Oakland, and Baltimore.

The rankings are based on 16 factors: Air Quality, City Commuting, Energy & Climate Change, Local Food/Agriculture, Green Building, Green Economy, Housing Affordability, City Innovation, Knowledge Base, Metro Street Congestion, Metro Transit Ridership, Natural Disaster Risk, Planning/Land Use, Waste Management, Tap Water Quality and Water Supply. For more information about the ranking's methodology see here.

As you can see from the graphic above Denver's highest scores were Knowledge Base (4), Green Building (5) , Energy and Climate Change Policy (6) and Planning and Land Use (8). Its lowest scores were Housing Affordability (33), Metro Street Congestion (36), Water Supply (40), and Solid Waste Diversion (43).

It really is shocking that Denver is ranking 43rd out of 50 cities in solid waste diversion. This is clearly an area where the Denver Region could improve its performance.

Below is Sustainlane's summary of Denver:

"In 2008, Denver played host to what planners hope will go down in history as the "greenest" political convention ever. We'll wait for the verdict to come in on that one before we comment... Meantime, if the Mile High City's utilities division crunches its numbers right (and we trust that they do), then by the end of 2008, the city will have increased its renewable energy portfolio by nearly 1000 percent since 2005. With momentum like that, Denver could meet the higher end of its goal of 20 percent renewables in less than five years. Denver's on track and moving forward in most SustainLane categories, but what we're really dreaming of is an increase in its solid waste diversion rate (9.5) by 1000 percent!"

How Denver Presented During the Convention: One Attendee's Opinion

2008-09-05T19:07:00.009-06:00

A friend and colleague of mine was in Denver for the Democratic Convention as part of a corporate sponsorship. He is a well-traveled, highly energetic and intelligent middle management marketing executive for a technology-driven Fortune 50 Company who lives and works in Manhattan. I interviewed him on his impression of Denver and the region based on his experiences at the convention.

What follows are only one person's reactions, but I found them insightful in understanding how the city presented to visitors during the convention. Much of the information below is not new or groundbreaking but it does confirm commonly held assumptions about the Denver Metro Area and help highlight regions' strengths and weaknesses. Sentences in italics below are my thoughts/extensions based on my friend's feedback.

1) Freewheeling/Bikes Belong Partnership: The free bike-sharing program during the convention helped highlight the excellent bike paths and recreational opportunities (such as kayaking in the South Platte at Confluence Park) in and around downtown Denver. This program was very successful and reinforced Denver's reputation as an outdoor friendly city that promotes healthy lifestyles. The city should explore how to make this type of bike sharing program a permanent addition to the transportation landscape.

2) Downtown Walkability: Downtown Denver is very compact and walkable. Way finding signage directed at visitors was "pretty good" and "probably better than New York" but had room for improvement.

3) Restaurants: There were lots of steakhouses and brew pubs but the food was average and it was not that easy to find outstanding places to eat. The Metro Denver Convention and Visitor's bureau should consider handing out restaurant guides at DIA when big conventions are in town.

4) Infrastructure: Although Denver was very crowded with convention related people and activities, it felt like the city had a well developed, "modern" infrastructure capable of appropriately supporting the convention. Invesco Field at Mile High and the Ellie Caulkins Opera House stood out as particularly beautiful venues.

5) Light rail: My friend stayed in Centennial in a hotel which was a 15 minute walk to a light rail stop. He found the light rail provided a good connection to downtown although was slower than driving during off peak times. It was impressive that the light rail trains stayed on schedule despite the extra large crowds, something the New York subway does not manage to do. However, the walk within Centennial from the light rail station to the hotel crossed many busy streets and did not provide a pedestrian friendly environment. Remaking the wider Denver Region into a more transit friendly, walkable, bikable place will be an enormous undertaking. FasTracks is an important piece of this effort. However, the broader changes required, to streetscapes, the built environment and socio-cultural habits will not come quickly or easily but they are critically important to the region's long-term economic health.

6) Physical Geography and Climate: Denver was flatter than expected and the sun was really hot but the mountains provided a scenic backdrop and the light at dusk was particularly beautiful.

7) Hospitality of Local Residents: Denver is a friendly city. Locals regularly asked where visitors were coming from and suggested that they come back for another visit.

8) Convention Logistics: Overall the city and region did a "great job" with security and logistics. My friend was able to bypass the long lines at Invesco for the Obama acceptance speech because he had special visitor passes which provided expedited access. On Friday morning the security screening at DIA was smooth and efficient in spite of the large crowds.

9) Overall Impression: Denver came across as a well-developed, nice, livable, healthy city which did a very successful job of hosting the convention. The historic nature of the convention and the related activities exerted such a strong magnetic pull, that they drew much of the attention away from the city. Although he enjoyed his experiences in Denver, my Friend does not feel compelled to return as a tourist.

New Yorker Feature Story on Politics in Colorado and Governor Bill Ritter

2008-08-31T13:07:00.004-06:00

Its a a sure sign that the national political and economic profile of Colorado and the Intermountain West has risen when The New Yorker does a lengthy feature story on the state's politics and current Governor Bill Ritter. However, as evinced by the picture below from the beginning of the article, the cowboy metaphor will probably always stay with the region.

Picture above from September 1, 2008 issue of The New Yorker.

The following excerpt from the article provides an overview of the economic changes in the region and refers to the recent Brookings Paper on the "Mountain Megas" in the Rocky Mountain Region.

"The Front Range is expected to have 6.3 million residents by 2040—a fifty-per-cent increase over today—and demographers have devised a new vocabulary to describe the distinctive characteristics of this and similar regions in the Southwest...The fastest-growing suburbs in these areas, such as Westminster and Lakewood, outside Denver, are known as 'boomburbs. What these megapolitans have in common are economies that are moving away from agriculture and the extraction industries (like mining, gas, and oil) and toward service industries (like tourism and hospitality) and high technology (like aerospace and biosciences). According to Brookings, the region will soon become the center of the postindustrial economy, meaning that 'the southern Intermountain West is well on its way to earning itself the title of the New American Heartland.'"

Ten Observations About Denver During the Convention

2008-08-29T15:26:00.004-06:00

Here are ten of my observations, from a vantage point on the east coast, about how the Denver Region came across during the convention and how the region was/will be impacted by this historic event:

1) As a native Coloradan from the Denver Region, I took tremendous pride that Denver was able to successfully host the 2008 Democratic Convention.

2) I am very relieved that there were no major negative surprises which occurred during the event. The tornado in Parker on Monday was in inauspicious beginning.

3) Denver came across very well in the television and print media coverage. I was surprised by how few shots there were of the Rocky Mountains and how many there were of the bustling urban cityscape. I wonder how much of this was planned by city officials and how much was based on organic, independent decisions by the media outlets. There were also numerous mentions of Colorado's sunny weather and natural beauty from Bill Hemmer, Tom Brokaw and other national media figures.

4) I loved the MSNBC set which used day and night views of Union Station and the "Travel by Train" sign and the contextualism of the Gates headquarters building as an exciting urban backdrop.

5) All the public investments in downtown Denver - the Pepsi Center and Invesco Field at Mile High, the light rail, the convention center and the Hyatt hotel, the Hamilton wing of the Denver Art Museum - really paid dividends during the convention week.

6) In addition to the short-term economic bump, there will be a hard to measure but real flow of benefits to the Denver Region and Colorado from this convention. This will happen slowly over time in the years and decades to come in terms of brand awareness and an increase in Denver's global profile, in-migration, job attraction, tourism, capital flows and in other unknown ways.

7) I loved the fact that the football stadium's spiritually true name "Mile High Stadium" rolled off politicians and media members' tongues so much more frequently than "Invesco Field" did.

8) The City of Denver will be forever linked with a great American historic milestone - the nomination of the first African American for the office of President of the United States by a major political party.

9) Colorado's emerging green energy cluster is perfectly poised for rapid growth, particularly if Barack Obama wins the presidential election and channels $150 billion over the next ten years toward alternative energy development.

10) Both the Pepsi Center and particularly Invesco Field at Mile High came across as incredible venues.