Today in New West news: Christina Henderson of the Montana High Tech Business Alliance, the Paris climate talks and Wyoming, and checking up on Denver’s commercial real estate market.
Christina Henderson recently recounted in the Bozeman Daily Chronicle her first years in Montana and her transition from transplant to her current position as executive director of the Montana High Tech Business Alliance. It’s a portrait not only of Henderson’s journey, but (in a certain sense) Montana’s and their relative ascension. At the start, however, things were a little rocky for Henderson. From the Chronicle:
In January 2011, I drove out a week ahead of the moving van to learn about Montana’s economy and scope out job prospects. I braved snowy mountain passes and slept on an air mattress to attend the annual Montana Economic Outlook Seminars hosted by the University of Montana’s Bureau of Business and Economic Research (BBER).
At the seminar I sat next to a job counselor for a local employment agency who deflated my optimism. I was shocked to discover Montana is 49th in the country for wages, ahead of only Mississippi. He warned me to expect a pay cut. Some candidates searched years before finding a job.
Thankfully, my search ended relatively quickly. BBER hired me as their marketing director to plan the Montana Economic Outlook Seminars in 2012; my first great opportunity.
At BBER, I interrogated economists about Montana’s low wages. I wrote articles for Montana Business Quarterly examining the outsized impact of high-growth companies on job creation.
Her work led her to the MHTBA, which was founded in April 2014. From a pool of 20, Henderson reports, the Alliance has grown to over 250 members, spread across Montana, with one third in Bozeman and another third in Missoula. Further, MHTBA businesses are reportedly driving growth in both median income and the state economy.
It’s a signal, surely, of Montana’s changing fortune. What a difference a few years can make.
Over the weekend, 195 countries signed a deal in Paris promising to cut emissions worldwide and prevent global temperatures from rising 1.5 degrees Celsius (~2.7 degrees Fahrenheit) above preindustrial levels. Indeed, according to the Casper Star Tribune, such a deal could signal changing times for the Cowboy State, which derives 70 percent of its tax revenue from coal, oil, and gas mining. This has some in or representing Wyoming fretting, others defiant. From the Tribune:
“We’re talking about an entire change of how we use energy in the economy for the coming century,” said Robert Godby, a professor who tracks the energy industry at the University of Wyoming. “I think Wyoming, because we have more to lose than other places, we are going to have to change more than the rest.”
Coal, as the most carbon intensive fuel, has the most to lose. Trading Monday on Wall Street underlined the potential impact on the industry. Peabody Energy, America’s largest coal company, was down 13 percent to $7.66 per share. Cloud Peak ended the day down 11.3 percent to $2.04 a share. And Arch Coal was at .89 cents a share, a decrease of roughly 1 percent.
State leaders showed no signs of abandoning coal, however. They called the Paris accord impractical, noting it contained no measures to reduce coal’s emissions despite the fact it is one of the world’s leading fuel sources.
WY Governor Matt Mead, in light of the deal, announced his intention to research carbon sequestration, something the governor has previously advocated. Mead added he believes the world isn’t ready to move on from coal.
Over in Colorado, Denver’s commercial real estate market continues to weather changes, especially in light of the rise of marijuana cultivators seeking industrial space. Industrial space across the board is in high demand, with a third-quarter vacancy rate of 3.7 percent, down from 4.8 percent for the same period in 2014. According to the Denver Business Journal, however, there’s more afoot in Denver’s market:
While some of the demand for industrial real estate can be attributed to the marijuana industry, Price said, manufacturing, food distribution and other warehouse needs are also applying upward pressure to the industrial segment.
Industrial space is popular across Denver, but the central submarket is the tightest, with a 1.8 percent vacancy rate in the third quarter. The area has about 10.7 million square feet of existing industrial space, according to Colliers, leasing at an average asking rate of $6.63 per square foot, triple-net.
But the area experienced negative absorption in the third quarter, giving back about 49,560 square feet to the market, which could have been impacted by the lack of inventory, especially relative to the Montbello submarket, which is home to more than 72.7 million square feet with a 3.3 percent vacancy rate, at a lower average asking rate of $6.34 per square foot, according to Colliers.
Denver’s office market has spent most of 2015 shaking off concerns about the impact of layoffs and consolidation in the oil and gas market, and third-quarter was no different.
Although the absorption rate of office space was slower in the third quarter of 2015 compared with the same period a year earlier, the vacancy rate dipped only slightly and average asking rates increased.
The DBJ further reports that the city’s office market is changing, with the River North neighborhood emerging as a popular area for companies looking to relocate.