SALT LAKE CITY (ABC4) – It’s not just Utah’s home market that’s red hot; the downtown commercial market is on fire too.
Cranes that stretch toward the sky are evidence that, despite a pandemic, people are betting on Utah’s future growth.
“We are witnessing a renaissance of economic development and development that is unprecedented,” says Brandon Fugal, chairman of Colliers International.
“There’s a record number of cranes dotting the skyline of Salt Lake City, especially as compared to the rest of the country. And it really speaks to how dynamic Utah is, and it’s well positioned to be a beneficiary coming out of the pandemic,” Fugal adds.
During the pandemic, he says, people flooded to Utah, many of them from big cities.
“The coastal markets are still incredibly challenged, not just by COVID, but by environments that are not business friendly,” says Fugal.
Utah’s reputation as being friendly to business is helping spur the state’s population growth, and he says businesses are attracted to Salt Lake City’s downtown. The construction we’re seeing didn’t just start during the pandemic, but he says it’s worth noting that it continued despite so many changes in this last year.
“Utah is having a moment, an incredible moment,” says Fugal.
Vacancy in industrial buildings is almost non-existent, whereas office vacancies have spiked during the pandemic. Still, he says office workplace environments will evolve — he calls it an amenities war — as companies make their office space more enjoyable and attractive to employees used to the comforts of home.
Compared to the record-high prices in Utah’s residential home market, he says Salt Lake’s commercial market is “very competitive,” cheaper than other large cities and an incredible bargain.
Still, he says builders are facing the same challenges in commercial as residential: spiking prices for materials like lumber.
“We’re still seeing a pronounced rise in the cost of commercial,” said Fugal.