Southwest Downtown Colorado Springs: The Perfect Opportunity Zone
Qualified Opportunity Funds are expected to raise billions. Colorado Springs should receive a good chunk of that change.
Location
Downtown Colorado Springs is the perfect Opportunity Zone. Densely populated urban areas are highly desirable for real estate developers and present many redevelopment opportunities. There are already dozens of massive developments underway ranging from 184-unit luxury apartment complexes to industrial-retail conversions. This area is already experiencing strong appreciation and dramatic transformation.
City of Champions
In December 2013 Colorado Springs was awarded an estimated $120.5 million by the Colorado State Economic Development Commission under the State Regional Tourism Act. This was for the “City for Champions” proposal which outlines 4 major developments in order to spur economic growth. This plan includes the US Olympic History Museum and Hall of Fame, a 10,000 seat downtown soccer stadium, the UCCS Sports medicine, and Training Center, and the Air Force Academy Visitor Center.
This project is finally gaining momentum, the US Olympic museum is nearing completion and final plans for the Downtown Sports Stadium have been approved.
The City for Champions projects are forecasted to:
- Boost the region’s $1.35 billion annual tourism industry
- Attract about 1.2 million visitors each year
- Add more than 500,000 new out-of-state visitors annually
- Increase retail sales by $140 million each year
- Increase gross metropolitan product by $217 million annually
- Add $4.4 million in new sales tax revenue for the city annually
- Add $2 million in new sales tax revenue for the county annually
- Leverage a $120.5 million state tourism improvement rebate
- Allow 23 local TEAM USA National Governing Bodies to host Pre-Olympic and World Championship events here
- City for Champions will brand Colorado Springs as Olympic City USA, and invite national/international sports performance and medicine entities to the city–to compete in events and do business.”
Both the US Olympic Museum as well as the Downtown Stadium are located within the Downtown Colorado Springs Opportunity Zone.
Economic Factors
Demographic Momentum
Among Major Metro areas, Colorado Springs had the highest rate of Millenial Migration (+14.7%) and the fifth highest population of young adults (26.4%). This is fueling a positive net migration and explosive population growth far outpacing new home building rate.
Job Market
The Colorado Springs area boasted an unemployment rate of around 3% in 2018, more than a full percentage point less than the national average.
City Support
The city wants to see continued growth within this Opportunity Zone. The Master Plan outlines the desire to capitalize on the momentum towards a vibrant downtown.
“Now is the time to align all business, government and community forces to create the greatest downtown of any midsize city in the country.”
And it isn’t all talk. The city has created many plans including the Mill St. Neighborhood plan and the Downtown Development Plan. Downtown has also been qualified for the statewide Enterprise Zone program which provides many tax incentives to new businesses. These plans have already resulted in the creation of new bike lanes, walkways, parking, the legacy loop, street repavement, and many other infrastructure improvements.
Real Estate Market
Real Estate in Colorado Springs is affordable and has a good rent/price ratio. This allows for cash flowing assets with extremely high upside. Appreciation rates have been high for the last decade with healthy annual rent increases.
Location Again
I know I already said this, but…
Colorado Springs has incredible natural assets. The entire Pikes Peak region is beautiful and offers world-class outdoor recreation. This natural beauty will continue to support the tourism industry in Colorado Springs and bring even more people to live in the area.
Summary
Downtown Colorado Springs is already experiencing massive redevelopment. The City itself is putting hundreds of millions into prominent developments, and private investment is soaring as well. The Opportunity Zone Program will only add to this momentum. If you are an individual or a Qualified Fund looking for a zone to invest in I strongly recommend you consider Colorado Springs.
Stay Tuned
Thanks for reading. If you want to learn more about Opportunity Zones or other Colorado real estate topics please follow me here on Medium!
If you have any questions you can contact me at TannerJCrawley@gmail.com or 623–451–8372
