Multifamily Permits On The Rise For Year

DENVER-At a time when the Denver-area economy is slowing, developers still pulled more multi-family permits in the first eight months of this year than during the same period in 2000. Developers pulled permits for 5,538 permits through August, 6.7% more than the 5,190 in the first eight months of 2000, shows the most recent report by the Home Builders Association of Metro Denver.

For the month of August, developers pulled permits for 976 units, down less than 2% from the 991 in August 2000.

The permit information comes from the building departments in Adams, Arapahoe, Boulder, Denver, Elbert, Douglas and Jefferson counties, as well as from more than 25 cities, villages and towns in the metro area.

Steve Rahe, an apartment broker at CB Richard Ellis, tells GlobeSt.com that he’s not surprised that there’s been an increase in permit activity.

”We kind of expected we would have a few more permits issued this year than in what we would consider a normal year,” Rahe says. ”I think developers pulled more permits as a result of the scare of Amendment 24 (the growth amendment that was overwhelmingly defeated last November), and so there was an extra rush to get underway and get permits issued.”

However, many of those permits weren’t released by municipalities until this year, he says.

Also, developers are looking to the future, he tells GlobeSt.com.

”For these permits issued today, the developer may have nine, 12 or even 18 months in time and money invested in a site,” Rahe says. ”And even if leasing is slow today on a short-term basis, I think the developer/investor looks at the medium- to long-term outlook as being very positive.”

That said, Rahe still thinks that permit activity will drop in 2002 and ”drop even a bit more in 2003.”