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The economy and its effects on Charlotte


Charlotte_native

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So there's a number floating around - 25% - to describe the number of architects that are now unemployed in the city.

I think that number is optimistic. There are offices that have shed north of 50% of their staff. I personally know of no office that hasn't had a round of layoffs or isn't on the verge of it. I don't think it will be much longer before some firms declare bankruptcy entirely.

Unlike past recessions in architecture, this one has hit (1) every geographic area and (2) every market segment. That means even firms that had diversified work across many fields, regions and nations are hurting, and hurting bad. Firms that were wholly vested in residential or commercial have been wiped out. Firms that were wholly vested in healthcare and institutional are struggling to stay afloat.

Basically, yes. The economy blows.

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The local news is making note of a number of regional banks starting to advertise for jobs in the Charlotte media. These would be positions where people would move from Charlotte to these other places. Would this mean that our population growth might stop and even reverse itself?

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For bankers I'm sure it already has. Maybe even for higher paying jobs, but most of the newcomers to Charlotte that I know or have dealt with don't work for banks. Those are our profile corporations and certainly what we are associated with, but they only account for a relatively small percentage of the jobs and business in the city.
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We actually did get one of these this year. I can't recall the name, but it is a distributor for the region for foreign car parts. They opened up shop in the Fall. My brother-in-law works there in the warehouse distribution center -- moved here in May with his wife and 2 kids from Kentucky where he was laid off (well, bought out) from the Ford factory there. They chose here because they visited us a lot and liked it. Both found jobs quickly -- him with whatever this company's name is and she works for CMC.
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I found the article below to be interesting but we will have to wait and see until next week to get a better idea of what it all means. Apparently in February, 45 firms expressed interest in relocating to Charlotte. That is more than the "boom years" of 2006 and 2007. A lot of them are high-paying, engineering and energy related jobs. Maybe Charlotte will benefit during this economic downturn by being able to attract more companies with our lower cost of living/doing business (there is plenty of office space to show off) and our high quality of life.

http://www.wsoctv.com/news/18866962/detail.html

Here is the associated video:

http://www.wsoctv.com/video/18866943/index.html

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I am not sure that I would be re-assured by a WSOCTV article just as much as I would not be worried about all the crime stories they run each day. They are simply parroting the Chamber of Commerce which I can tell you that if you asked the same question of ANY chamber of commerce you would also hear a similar thing. It's one of the reasons that we recommend that link posts to news media (especially of the local stuff) be avoided unless the details behind the story are apparent.

I do think it is good about the engineering jobs, but I believe that was reported here months ago. Energy, Health, certain portions of the IT industry, and of course Govt. jobs are still relatively unaffected by the slowdown in the economy. Charlotte has a presence in each, but none of these are huge industries here. I do realize that Duke is HQ'd here, and they won't be affected much by the downturn, they don't dominate in Charlotte as Energy does in places like Houston, Tulsa, etc.

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WCNC is reporting that a real estate company called Real Data is reporting the occupancy rate for apartments in downtown/uptown Charlotte has risen to almost 22%. I would assume this doesn't count the apts. that are going to hit the market with all of the condo to apartment conversions that are set to take place in the near future. I tried to look at Real Data's report but unfortunately it is a subscription service. (assuming I went to the right place). If this is true, my guess is this is going to stop ANY new projects for the time being and will continue to put price pressures on the existing buildings.

In the same token Allen Tate has announced that it will close 1/4th of it's offices in Charlotte. There are a lot of hurt real estate agents out there right now. They have a lot of property to sell, but no buyers. i.e. not only are they not making commissions, but are experiencing the carrying costs of these properties. I can see a retrenchment in this business. Then again it had gotten too large due to all of the price inflation that was going on.

I had predicted a couple of months ago 50% deflation in some of these markets in Charlotte. This notion was scoffed at and derided at the time. My recommendation is that if you intend to purchase property in CLT, then look at comps for the area of interest as they were in 1992 - 1993 and don't pay more than that. (and even that might be a risk).

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WCNC is reporting that a real estate company called Real Data is reporting the occupancy rate for apartments in downtown/uptown Charlotte has risen to almost 22%. I would assume this doesn't count the apts. that are going to hit the market with all of the condo to apartment conversions that are set to take place in the near future. I tried to look at Real Data's report but unfortunately it is a subscription service. (assuming I went to the right place). If this is true, my guess is this is going to stop ANY new projects for the time being and will continue to put price pressures on the existing buildings.

In the same token Allen Tate has announced that it will close 1/4th of it's offices in Charlotte. There are a lot of hurt real estate agents out there right now. They have a lot of property to sell, but no buyers. i.e. not only are they not making commissions, but are experiencing the carrying costs of these properties. I can see a retrenchment in this business. Then again it had gotten too large due to all of the price inflation that was going on.

I had predicted a couple of months ago 50% deflation in some of these markets in Charlotte. This notion was scoffed at and derided at the time. My recommendation is that if you intend to purchase property in CLT, then look at comps for the area of interest as they were in 1992 - 1993 and don't pay more than that. (and even that might be a risk).

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WCNC is reporting that a real estate company called Real Data is reporting the occupancy rate for apartments in downtown/uptown Charlotte has risen to almost 22%. I would assume this doesn't count the apts. that are going to hit the market with all of the condo to apartment conversions that are set to take place in the near future.
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In the same token Allen Tate has announced that it will close 1/4th of it's offices in Charlotte. There are a lot of hurt real estate agents out there right now. They have a lot of property to sell, but no buyers. i.e. not only are they not making commissions, but are experiencing the carrying costs of these properties. I can see a retrenchment in this business. Then again it had gotten too large due to all of the price inflation that was going on.
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Actually, other than really bad starter home development and huge McMansions, I would expect these areas not to be hurt nearly as much because they never went through the price inflation in general terms, than some of the close in neighborhoods. The problem with any property that has been valued more than $250K is the pool of available buyers just doesn't exist now. They don't have the necessary income and savings to qualify for a loan these days. I would also add any property that is valued more than $200/sq ft. The problem with that is value vs available buyers.
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WCNC is reporting that a real estate company called Real Data is reporting the occupancy rate for apartments in downtown/uptown Charlotte has risen to almost 22%. I would assume this doesn't count the apts. that are going to hit the market with all of the condo to apartment conversions that are set to take place in the near future. I tried to look at Real Data's report but unfortunately it is a subscription service. (assuming I went to the right place). If this is true, my guess is this is going to stop ANY new projects for the time being and will continue to put price pressures on the existing buildings.
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I am not sure that I would be re-assured by a WSOCTV article just as much as I would not be worried about all the crime stories they run each day. They are simply parroting the Chamber of Commerce which I can tell you that if you asked the same question of ANY chamber of commerce you would also hear a similar thing. It's one of the reasons that we recommend that link posts to news media (especially of the local stuff) be avoided unless the details behind the story are apparent.
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It shouldn't be that incredible to anyone who might put just a little thought into it.

In the first example I said that WSOC was parroting the Chamber of Commerce. Nobody disputed that. That post sat there for days without anyone disputing it. If they did, then point it out. In my post I said the WCNC was citing Real Data which I tried to validate on my own without citing it as fact. Again nobody disputes that and furthermore another posted validated this was probably correct. I also said that Allen Tate is closing 1/4 of its offices as reported in the press. Again, no debates on it. I don't see the issue here.

Now if you spent your time reading what I and others post instead of making posts critical of the poster, which I have not done in any of these cases, then you might actually figure out what is being said. If you had a message in your post, other than being critical of me at a personal level, it's gotten lost in your nonsense. And before you waste more of our time by pointing out that I am now being critical of you then don't. You don't also have the burden of making sure this forum might stick to the topic at hand.

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Sounds as if Mecklenburg County has decided to halt all new construction projects, parks, school buildings, etc, that have not already started, for 16 months.

There is also a report out there that says the hotel vacancy rate, not sure if this is city wide or just downtown, is something like 56%.

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I had predicted a couple of months ago 50% deflation in some of these markets in Charlotte. This notion was scoffed at and derided at the time. My recommendation is that if you intend to purchase property in CLT, then look at comps for the area of interest as they were in 1992 - 1993 and don't pay more than that. (and even that might be a risk).
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