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Economy – housing and commercial real estate market

The 2021 Book of Lists Reception, presented Jan. 28 by the Colorado Springs Business Journal, featured Colorado Springs Mayor John Suthers; Tatiana Bailey, director of the UCCS Economic Forum; and Aikta Marcoulier director of the Pikes Peak Small Business Development Center. The panelists fielded questions about the economy, the housing and commercial real estate market, and the ongoing saga over the permanent home of U.S. Space Command.  Search for homes for sale in Flying Horse at www.rehav.com.

The mayor had good news about the city’s financial status. “Amazingly enough, the city is doing quite well,” he said. “We certainly didn’t look that way in March and April. In March, city revenues were down 14 percent. In April, they were down 23 percent. We were modelling for as much as a 30 percent decrease in city revenues — $110 to $120 million, but it’s a tremendous tribute to the resiliency of our citizens that things changed pretty dramatically. As of right now, without seeing December, we’re only a half a percent down in General Fund revenue. That is mind-boggling when you think about it.”

Impact of COVID-19

While Suthers admitted that tourism has taken a hit during COVID, the sales tax paid by a certain “major online retailer” and a slew of residential and commercial construction projects helped keep city coffers in the black. “It’s particularly mind-boggling when the tourism industry is down 40 to 45 percent,” he said. “Every indication is that our tourism industry is the best in the country, but it’s still down 40-45 percent, that’s a billion-dollar-a-year industry or more, so that’s pretty remarkable that we’re able to do as well as we’ve done.

Commerical and Residential Construction

“Here’s what I think it is: No. 1, construction,” said Suthers. “2020 was a record year for both commercial and residential construction. These huge projects like Amazon at the airport — there’s a lot of use tax involved in that. We had a record number of residential permits. The other thing, if this had happened in 2018, before the United States Supreme Court said that cities could tax online sales at the point-of-sale, or point-of-delivery, we’d be hurting very badly. Remarkably enough, I think people are actually spending more money. During COVID a lot of people are at home, they still had jobs. We’re unable to mention the names of certain taxpayers by law, but there’s a major online retailer out there, they collected $360,000 in November of 2019 in sales tax. This November they collected $1.4 million.”

 

 

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