As the Gateway to the Rockies, Denver offers an appealing blend of a high quality of life and diverse job opportunities to its young, millennial population.
The Denver-Aurora-Lakewood metro region’s vibrant tech industry and emerging science hub continually attracts top talent, and 45% of apartment searches in Denver are coming from prospective renters who are currently living outside of the area. (1) There are several compelling reasons why investors may want to consider this area’s multifamily market.
Denver has a strong job market and economy
Metro Denver rallied mid-pandemic and has recovered 100% of jobs lost as of April 2022, with unemployment restabilized at 3.9%. (2). With a strong technology hub already established, Denver has been ranked No. 1 on the STEM Jobs Growth Index for 2021 (3), a position attributed to the region’s top-quality workforce and a sizable millennial population, as well as additional factors including industry growth, wages, and quality of life.
Source: RCLCO: 2021 STEM Job Growth Index
The Denver-Aurora-Lakewood area has been ranked in the top 3 job markets (4) in the U.S. within the last 2 years, and the area is home to 10 Fortune 500 companies, including Molson Coors and Western Union, as well as employment hubs like the Fitzsimons Life Sciences District, which employs 25,000 people.
Denver rents are on the rise
While rents were generally inconsistent during the pandemic, prices rose in the Denver metro area during 2021 (5), and this upward trend is continuing in 2022.
Rent prices have increased 15% in both Denver and Aurora Y/Y as of March 2022 (6) and the Denver-Aurora-Lakewood region currently is the most expensive non-coastal rental market in the U.S., ranking 11th nationally among large metro areas. (7)
Home prices in Denver have hit a historic all time high in 2022
While rents are up compared to 2021, there was a steep decline in the number of available homes listed to buy in the area at the start of the year, with a nearly 50% decrease in active listings as of January. (8)
With this shortage hitting a historic low, industry experts (8) forecast that average home prices would skyrocket as the year progressed, a prediction that has been proven true, with a 15% monthly rise in February (9), and a further 8% rise in March, leaving average home prices at record-setting prices. These rising house prices mean that many people in the area are left seeking more affordable housing alternatives.
Our latest multifamily deal in Aurora is capitalizing on the strong economy and job market in the Denver metro area. The asset is located adjacent to the expansive Fitzsimons Life Sciences District in Aurora, 8 miles east of Denver. This deal is iintoo’s 4th with the experienced sponsor including two active deals, in Aurora, CO and Austin, TX. If you are interested in exploring this offering, log in to our platform to find detailed information.
(1) Source: Mile High CRE: Denver Rents Rise
(2) Source: Metro Denver EDC: Monthly Economic Indicators 2022
(3) Source: RCLCO: 2021 STEM Job Growth Index
(4) Source: WSJ: Austin, Nashville Rank at Top of Hottest U.S. Job Markets
(5) Source: The Denver Post: Pandemic pushes metro Denver apartment market into uncharted waters (6) Source: Rent dot Com: April 2022 Rent Report
(7) Source: KDVR: Metro Denver Most Expensive Non Coastal Rental Market
(8) Source: 9 News: Historic Low Inventory Expected Price Climb Denver Housing Market
(9) Source: Denverite: Denver’s Median Home Price Climbed 15% From January to February