Construction forecast.

• Author: Lewis, David
• Position: Denver's building market - Industry Overview

Pick your prognostication: What will Denver's building market do?

Take one: The Denver metro real estate and construction markets are slowly sliding backward.

Ahem. Take two: The Denver market is looking forward to sustained growth in 1999.

Hold it. Let's try that again. Take three: Denver metro is looking forward to mixed prospects for the remainder of the year.

Predicting the future of property prices and investments, apartments and condos, industrial construction and all the rest is a little like choosing dinner from a Chinese menu: You can order up the future you like from column "A" and column "B," and at the end of the meal you get a fortune cookie.

Nevertheless, many distinguished real estate and construction prognosticators have delivered predictions for their respective markets in '99. Often those predictions are at odds with each other, depending on whether wishful thinking or cautious conservatism is the order of the day.

Case in point: Focus Colorado: Economic & Revenues Forecast, 1998-2004, a report issued last September by the Colorado Legislative Council, ran this bold black headline: "Construction Activity will Slow Dramatically in 1998."

Well, now we know better. (But, unlike most available forecasts, the council report at least analyzed statewide activity.)

With these caveats in mind, ColoradoBiz presents these Denver-area construction and real estate forecasts, a compilation of every forecast we could lay our hands on.

1998 set metro-area home sale and construction records that will be hard to match this year. The Denver Board of Realtors predicts more of the same for 1999 "thanks to a number of major developments on the drawing board in the City and County of Denver, and a healthy economy (albeit slower in 1999)," said a recent board report.

Early returns appeared to buttress that prediction. January 1999 home sales (the latest figures available) slumped slightly from the two preceding months', to aggregate dollar volume of about $514 million from more than $527 million in December. Seasonally adjusted, however, January was stronger than any month in '98.

The fly in the ointment, however, could be construction. "Everything seems to be right on target," said board CEO Brad Benson. "We just hope the supply increases," especially of lower-cost homes.

Speaking of construction, here's another early indicator: Denver-based M.D.C. Holdings in February announced it had received orders for 626 homes the month before. This number...