Steamboat Springs, CO - (November 16, 2008) - Members of Steamboat’s real estate and development community gathered at the Steamboat Grand Resort Hotel ballroom Wednesday to look for reasons for optimism on the heels of a third quarter that produced the lowest unit sales volume in more than five years.
The occasion was the second Colorado Group Realty Real Estate Roundup and Expo.
One presenter acknowledged after the conference that the decline in transaction volume is apt to lead to attrition among the ranks of area Realtors early next year — perhaps by as much as 30 percent..
Colorado Group Broker Owner Jim Cook produced a bold prediction about downtown commercial real estate.
“The good news is that in Alpen Glow, The Victoria and The Olympian, 100 percent of the retail spaces are sold or leased,” Cook said. “There are still some holes in Howelsen Place, but overall, I think that’s very encouraging.
“We’re all aware that our City Council is worried about sales tax receipts for next year. I predict that we will see an increase in sales tax revenues in the downtown from new businesses that are opening on the order of double digits.”
Cook, who is a partner in Alpen Glow and Howelsen Place, said he expects to see four to six grand openings for businesses during a downtown ceremony Dec. 13.
Among the new openings are Zirkel Trading and Urbane. Vectra Bank also will be relocated to Howelsen Place, a move that will create more space for the Steamboat Art Museum store.
Cook said he attaches symbolic importance to the new Steamboat Ski & Resort Corp. branded retail store set to open in Howelsen Place this winter.
“The Ski Corp. saw the importance of creating connectivity between the downtown and the mountain,” he said. “It’s really important that we create that relationship for new downtown residents.”
Cook said that during a trip to Steamboat, former Intrawest CEO Alex Wasilov said one of the values his company saw in the acquisition of the Steamboat Ski Area was the strong brand of the downtown area.
“It was shortly after that (Steamboat Ski & Resort Corp. President and COO) Chris Diamond and I began talking about the store,” Cook said.
In addition to selling branded merchandise and lift tickets in its downtown location, Cook said the ski area would offer a ski concierge service. It will allow guests of second- and third-story residential units in
downtown buildings to have rental skis and boots fitted in their accommodations and then have them delivered to a storage/changing facility at the ski area.
“That means they won’t have to lug their equipment to the mountain,” Cook said. “They can just jump on the bus.”
Colorado Group Operations Manager Bart Kounovsky opened the Roundup program by telling the gathering that the local market has reversed itself in less than a year.
“The seller’s market of 2006 and 2007 has turned into a buyer’s market in 2008,” Kounovsky said.
His colleague, Annamarie Shunny, told the gathering that the past six weeks have put up some more encouraging numbers in terms of dollar volume.
“Since Sept. 30, we’ve closed another $39 million in real estate,” Shunny said.
Dollar volume of sales recorded by the Steamboat Springs Multiple Listing Service through the end of September was $247 million. That compares to $524 million for the same period in 2007 and $289 million in 2006. Shunny pointed out that although dollar volume is less than 50 percent of last year, current numbers compare far more favorably to the previous record year of 2006.
However, if unit volume is an indicator of how well commissions are spread among rank and file Realtors, that doesn’t add up to good news.
Unit volume, the number of sales versus the aggregate dollar value of sales, totaled 228 in the third quarter. That number is fewer than the number recorded for just the month of September in all but one of the past five years. That statistic doesn’t come from the Steamboat MLS but the countywide statistics compiled by Bruce Carta of Land Title Guarantee Co. Accordingly, it includes transactions that weren’t handled by a Realtor. But the trend is clear.
July saw 94 transactions; There were 70 in August and 64 in September. Before this year, the last time a single month saw fewer than 100 transactions was February 2004.
“That is going to affect the attrition rate of Realtors not just locally, but nationally,” Shunny said. “Locally we’re expecting the rate of attrition to be up to 30 percent.”
The trend probably won’t emerge until the end of January when Steamboat Realtors must pay their annual dues. There are presently 412 licensed real estate brokers in the Steamboat MLS compared to 427 in January 2008.
Even amid the national real estate slowdown, Shunny said, the price per square foot of Steamboat real estate is up. The average price per square foot of a home sold here in 2006 was $290. The figure increased to $450 in 2008. Similarly, the average price per square foot of a Steamboat townhome in 2008 was $440.
Shunny acknowledged to her audience that the most expensive Steamboat real estate is accounting for the bulk of dollar volume late this year and is partly responsible for skewing those numbers.
“The high-end sales market, we’ll say over $2 million, has been very strong,” she said.