May 15, 2013  Economic & Market Research / Land & Development Planning

Landscape Architecture / Community Planning & DesignGolf Feasibility Analysis

Colorado Self Storage Association’s 2013 Spring Meeting & Trade Show

The State of Colorado’s Front Range EconomySelf Storage Forecast

THK Associates, Inc.

Colorado’s Front Range

Approximately 4.1 Million People in 1.6 Million Households Of Which 2.6 Million People Employed

Historical 10-Year Annual Totals 27,700 Jobs 58,500 People 28,000 Households Employment growth only

7,000 employees past 5 years

25% of average

10-Year ProjectionsAnnual Totals 42,200 Jobs 66,000 People 26,700 Households

Colorado’s Front Range

Residential Construction 19,000 Total Residential

Permits Issued in 2012 10-Year Average 22,800 2012 Total 83% of 10-

Year Average

Colorado’s Front Range

Colorado vs. National Self Storage Market

 

Colorado Self Storage Market vs. National Self Storage Market, 2013

                  

    Number of Area Square Existing Supply  Market Facilities Footage (Sq. Ft. per Person)           National 50,859 2,999,155,230 7.55         

1Texas 6,549 386,194,530 15.132Florida 3,531 208,223,070 11.023Georgia 1,624 95,767,280 9.804Washington 1,575 92,877,750 13.665Michigan 1,502 88,572,940 8.996Ohio 1,478 87,157,660 7.557New York 1,429 84,268,130 4.348Pennsylvania 1409 83088730 6.529Arizona 1,319 77,781,430 12.03

10Tennessee 1,314 77,486,580 12.1211Illinois 1,285 75,776,450 5.8912Colorado 1,257 74,125,290 14.56 13Alabama 1,249 73,653,530 15.31 14Missouri 1,131 66,695,070 11.09 15Louisiana 1,110 65,456 14.31

         

Source: 2013 Self Storage Almanac and THK Associates, Inc. 

VS.

Front Range Self Storage Market

Front Range Self Storage Market Overview, 2013           

    Denver Metro* Colorado Springs Northern Colorado**Front Range

Total           

Approximate Number of Facilities   394 152 91 637           Area Square Footage   20,519,967 7,068,000 4,112,511 31,700,478           Population   2,920,000 639,300 567,200 4,126,500           Households   1,160,000 242,500 215,500 1,618,000

           Employment   1,915,000 367,000 350,000 2,632,000           Avg. Household Income   $59,680 $57,079 $56,475 $57,745           Sq. ft. / Population   7.03 11.06 7.25 7.68

           Sq. Ft./Households   17.7 29.1 19.1 19.6

           Sq. Ft./Employment   10.7 19.3 11.8 12.0           Average Occupancy   85% - 90% 85% - 90% 88% - 92% 87% - 90%           Average Facility Size Sq. Ft. 60,226 57,376 43,839 53,814  Units 449 377 350 392           * Metro Denver is defined by Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, and Jefferson Counties  **Northern Colorado is defined by Larimer and Weld Counties      ***Data not found in the 2013 Self Storage Almanac based upon selective samples               Source: Self Storage Almanac, Bureau of Labor Statistics, and THK Associates, Inc.    

Front Range Self Storage Market

Front Range Self Storage Rental Rate Overview, 2013                 

                 

Market 5x5 5x10 10x10 10x15 10x20 10x25 10x30 20x20                 

Denver/Aurora MSA* $48 $75 $120 $140 $165 $180 $200 $250  $1.92 $1.50 $1.20 $0.93 $0.83 $0.72 $0.67 $0.63

                 Colorado Springs MSA $40 $60 $95 $120 $135 $155 $170 $200  $1.60 $1.20 $0.95 $0.80 $0.68 $0.62 $0.57 $0.50                 Northern Colorado** $35 $50 $75 $90 $105 $120 $135 $155  $1.40 $1.00 $0.75 $0.60 $0.53 $0.48 $0.45 $0.39                 

* Metro Denver is defined by Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, and Jefferson Counties  

**Northern Colorado is defined by Larimer and Weld Counties          

***Data based upon selective samples              

                 

Source: 2013 Self Storage Almanac and THK Associates, Inc.          

Colorado Springs/El Paso County

Approximately 639,300 People in 242,500 Households Of Which 367,000 Million People Employed

Employment 10-Year Average 3,260

Jobs 5-Year Average 340 Jobs 2012 Added 1,500 Jobs 2011 Added 6,300 Jobs

10-Year ProjectionsAnnual Totals 5,500 Jobs 9,500 People 4,000 Households

Colorado Springs/El Paso County

Residential Construction 2,620 Total Residential

Permits Issued in 2012 2,020 or 78% for Single

Family Homes 10-Year Residential Permit

Average 3,880

Colorado Springs/El Paso County

10-Year Residential Demand 4,420 Units Annually

3,100 Single Family (70%) 380 Townhome (8.5%) 940 Multi Family (21.5%)

Colorado Springs/El Paso County

Projected Commercial Space Demand

Industry 10-Year Annual Average

Office 415,000 Sq. Ft.

Industrial 471,750 Sq. Ft.

Retail 310,000 Sq. Ft.

Hot Spots/Opportunities In-fill, Downtown and Key

I-25 Interchanges Student Housing Multi Family Rental Affordable Single Family

Average Annual Demand for 1.7 New Facilities

Total Demand for 19.1 New Facilities by the End of 2023

• Based on Average Facility Size of 57,376 Sq. Ft.

Projected Colorado Springs Self Storage Demand, 2013-2023           

      Cumulative Annual Cumulative    Annual Sq. Ft. Additional Sq. Ft. New Sq. Ft.

Year Population Change Demanded Demanded Demanded           

2013 639,324 5,720 7,121,881 53,881 53,8812014 645,160 5,836 7,177,416 55,535 109,4162015 653,250 8,090 7,255,936 78,520 187,9362016 662,660 9,410 7,349,094 93,158 281,0942017 672,340 9,680 7,446,842 97,748 378,8422018 682,290 9,950 7,549,326 102,484 481,3262019 693,000 10,710 7,661,844 112,518 593,8442020 704,040 11,040 7,780,148 118,305 712,1482021 715,410 11,370 7,904,426 124,278 836,4262022 727,140 11,730 8,035,203 130,777 967,2032023 738,680 11,540 8,166,435 131,232 1,098,435

           

           

Average          Annual Demand          

(2013-2023) 9,936     99,858             

1\ Based on estimated existing supply of rentable square feet per person in 20132\ Assumes an average occupancy demand growth rate of 2.0% annually and a stablized occupancy rate of 85%      

           Source: THK Associates, Inc.        

Metro Denver 7-County Region

Approximately 2.92 Million People in 1.16 Million Households Of Which 1.92 Million People Employed

Employment 10-Year Average 20,138 Jobs 5-Year Average 8,862 Jobs 2012 Estimates

24,000 – 37,000 Jobs

10-Year ProjectionsAnnual Totals

29,000 Jobs 45,000 People 18,000 Households

Metro Denver 7-County Region

Residential Construction 14,300 Total Residential

Permits Issued in 2012 6,200 or 43% for Single

Family Homes 10-Year Residential Permit

Average 14,500

Metro Denver 7-County Region

10-Year Residential Demand 18,500 Units Annually

10,800 Single Family (58%)

2,700 Townhome (15%) 5,000 Multi Family (27%)

Denver Metro Area OverviewProjected Commercial

Space Demand

Industry 10-Year Annual Average

Office 3,570,000 Sq. Ft.

Industrial 3,340,000 Sq. Ft.

Retail 1,500,000 Sq. Ft.

Leading Sectors Finance & Insurance Health Care Government Professional & Technical

Services

Major Announcements Charles Schwab Redwood Trust Hitachi Data Systems Tri Zetto On Deck Capital Cool Planet Energy

Systems

Proposed FasTracks Lines

94 Total Stops 46 Completed 48 Planned

Line Estimated Completion

# of New Stops

US 36 BRT 2015 6

Central 2016 2

East 2016 6

Gold 2016 7

I-225 2020 8

North Metro 2020 8

Northwest 2020 7

Southeast 2020 3

Southwest 2020 1

Total 48

Denver FasTracks TODDevelopment Totals as of Dec. 2012

Housing Units 24,439

Hotel Rooms 6,336

Retail Space (SF) 5.37 Million

Office Space (SF) 6.02 Million

Civic Space (SF) 2.3 Million

Education Space (SF)

1.94 Million

Medical Space (SF)

7.02 Million

Convention Space (SF)

2.62 Million

Projects That Are Complete or Currently Under Construction

Source: RTD FasTracks

Denver In-Fill Downtown

Downtown Denver Partnership 72 Public & Private Sector Developments in the Past 5

Years 6,061 Residential Units Added/Under Construction 2.36 Million Sq. Ft. Office Space Added/Under

Construction 2,190 Hotel Rooms Added/Under Construction 42% of Projects Residential

New Denver Area Hospitals Sky Ridge – Highlands Ranch Parker Adventist – Parker Fitzsimons Campus – Aurora

University Hospital Children’s Hospital Veteran’s Hospital

St. Anthony Hospital at the Federal Center – Denver

Castle Rock Hospital at the Meadows – Castle Rock

Northern Hospital Cluster along Hwy 7 & I-25 – Broomfield

Rocky Vista Hospital – Parker Platte Valley Medical Center –

Brighton Longmont United Hospital –

Longmont Children’s Hospital at Highland’s

Ranch University North/Poudre

Average Annual Demand for 5.5 New Facilities

Total Demand for 82.0 New Facilities by the End of 2023

• Based on Average Facility Size of 60,226 Sq. Ft.

Projected Metro Denver Self Storage Demand, 2013-2023         

      Annual Cumulative    Annual Additional Sq. Ft. New Sq. Ft.

Year Population Change Demanded Demanded         

2013 2,918,914 37,481 245,344 1,535,5042014 2,957,160 38,246 255,358 1,790,8622015 2,997,140 39,980 272,276 2,063,1382016 3,039,380 42,240 293,421 2,356,5582017 3,083,570 44,190 313,106 2,669,6642018 3,129,780 46,210 333,966 3,003,6302019 3,177,190 47,410 349,492 3,353,1222020 3,226,310 49,120 369,339 3,722,4622021 3,276,730 50,420 386,697 4,109,1582022 3,328,490 51,760 404,913 4,514,0712023 3,381,650 53,160 424,182 4,938,254

         Average        

Annual Demand        (2013-2023) 46,274   331,645  

         1\ Based on estimated existing supply of rentable square feet per person in 20132\ Assumes an average occupancy demand growth rate of 2.0% annually and a stabilized occupancy rate of 85%    Source: THK Associates, Inc.      

Larimer/Weld County Region

Approximately 567,200 People in 215,500 Households Of Which 350,000 People Employed

Employment 10-Year Average 4,330

Jobs 5-Year Average (2,600)

Jobs 2012 Added 3,200 Jobs 2011 Added 3,000 Jobs

10-Year ProjectionsAnnual Totals 7,700 Jobs 11,500 People 4,730 Households

Larimer/Weld County Region

Opportunities in the Niobrara Formation Colorado Produced a 50-Year High in Oil Production in 2012 Major Oil Company Corridor Follows Highway 85 North of Brighton Major Companies Involved

Anadarko, Noble, EOG, Chesapeake, Halliburton, Schlumberger, Baker Hughes, etc.

Estimates Call for Approximately 1,000 Wells to be Drilled Each Year for the Next 10 – 30 Years

Larimer/Weld County Region

Residential Construction 2,100 Total Residential

Permits Issued in 2012 1,560 or 75% for Single

Family Homes 10-Year Residential Permit

Average 4,515

Larimer/Weld County Region

10-Year Residential Demand 5,000 Units Annually

3,600 Single Family (70%) 200 Townhome (5%) 1,200 Multi Family (25%)

Larimer/Weld County Region

Projected Commercial Space Demand

Industry 10-Year Annual Average

Office 607,000 Sq. Ft.

Industrial 768,000 Sq. Ft.

Retail 500,000 Sq. Ft.

Hot Spots/Opportunities Highway 85 Corridor

Brighton, Fort Lupton, Greeley

Harmony Medical Corridor Windsor Frederick, Firestone, Dacono Fort Collins, Rental & In-Fill Timnath

Average Annual Demand for 2.0 New Facilities

Total Demand for 25.7 New Facilities by the End of 2023

• Based on Average Facility Size of 43,839 Sq. Ft.

Projected Northern Colorado Self Storage Demand, 2013-2023           

      Cumulative Annual Cumulative    Annual Sq. Ft. Additional Sq. Ft. New Sq. Ft.

Year Population Change Demanded Demanded Demanded           

2013 567,243 7,677 4,308,255 53,933 249,6772014 574,920 10,390 4,382,708 74,452 270,1962015 585,310 10,670 4,460,695 77,988 348,1842016 595,980 10,980 4,542,554 81,859 430,0432017 606,960 11,270 4,628,255 85,701 515,7442018 618,230 11,580 4,718,075 89,820 605,5632019 629,810 11,910 4,812,301 94,227 699,7902020 641,720 12,240 4,911,076 98,774 798,5652021 653,960 12,600 5,014,789 103,713 902,2782022 666,560 12,950 5,123,515 108,726 1,011,0042023 679,510 13,250 5,236,985 113,470 1,124,473

           Average          

Annual Demand          (2013-2023) 11,227     89,333  

           1\ Based on estimated existing supply of rentable square feet per person in 20132\ Assumes an average occupancy demand growth rate of 2.0% annually and astabilized occupancy rate of 85%

           Source: THK Associates, Inc.        

Front Range Self Storage Hot Spots Denver CBD

Union Station Highlands/Jefferson Park RidgeGate, Parker &

Castle Rock South Aurora Hwy 85 Corridor

Brighton to Greeley Harmony Medical Corridor Central Boulder Colorado Springs CBD Woodmen Rd/Falcon

Corridor Powers Blvd (Hospital

Corridor) Central Pueblo Pueblo West

Daniel M. ConwayPresident