Omaha #CRE Blog

Weekly Updates - Economic News

Week of June 13th - 17th

Housing Trilemma

  • What is it? A study conducted by the Oregon office of economic analysis, comparing the 100 largest metro areas in the United States. The study ranks metro areas on affordability, quality of life and economic strength. It contends that most metros can achieve two of the three, but not many can achieve all three. Only eight of the 100 metros rank among the top half for all three measures. Omaha is one of the eight metros.
  • What does it mean? Omaha ranks higher than the 90% percentile in the following categories: price income ratio, cost burdened renters and working age emp-pop. The price income ratio is defined as the median home value to median household income ratio. The cost burdened renters figure is the share of rental households spending 30% or more of their income on rent. The working age emp-pop ratio is the share of population 25-54 years old that is employed. Omaha scored less than 50% on the vacancy rate, start-ups and quality of life. The vacancy rate is the share of all housing units that are vacant. Start-ups is the share of all firms that are less than three years old. Quality of Life is measured on various data points: heating and cooling degree days, sunshine, average slope of the land in the metropolitan area, coastal proximity, violent crimes per capita, property crimes per capita, air quality index, bars and restaurants, and arts and culture.
  • What's driving this? There are no great surprises here. Omaha is known to have a relatively low cost of living and a very low unemployment rate. The vacancy rate in housing is low due to the conservative nature of our local business community. Speculative housing isn’t built at the same level as in larger metro areas. That probably won’t change. Some things are what they are: Omaha will never have a variety of slope of the land or ever be close to the coast. I say live here and visit those other places.  Here’s how neighboring metros compare:

Sources: Oregon Office of Economic Analysis

Week of May 30th thru June 3rd

U.S. Consumer Sentiment/Confidence/Spending

  • What is it? A measure of how positively or negatively consumers are feeling about spending and the economy. Consumer spending makes up more than two-thirds of economic demand in the U.S. There are several measures: The University of Michigan’s Surveys of Consumers, the Conference Board’s consumer confidence index and the U.S. Commerce Department’s personal spending report.
  • What does it mean? The results are mixed. According to the University of Michigan, consumer sentiment rose to 94.7 in May from April’s score of 89. This is the biggest monthly increase since 2013 and the highest it’s been in eleven months. The U.S. Commerce Department reported that consumer spending rose at the fastest rate in nearly seven years for the month of April. They report that consumer spending increased 1.0 percent from March to April. However, the Conference Board’s index fell to 92.6 in May from 94.7 in April, the second monthly drop in a row. While consumers indicate they feel more confident, supply is not reflecting this. GDP expanded only at an annual rate of 0.8% for the first three months of 2016.
  • What's driving this? The U.S. Commerce Department states that gains in income, a robust labor market and relatively low inflation were the reason for increased spending in April. Specifically, auto sales were strong for the month. Personal income rose 0.4 percent in April. The personal saving rate fell to 5.4 percent in April from 5.9 percent in March. The University of Michigan’s report sites positive views toward auto and home sales due to low interest rates as a driver toward the increased score. According to the Conference Board, the score indicating business conditions are “good” increased, but so did the score indicating business conditions are “bad.” The score indicating that jobs are “hard to get” increased. Also, the score for those “anticipating fewer jobs” in the future increased. This goes against recent jobs reports, specifically the Bureau of Labor Statistics April report that employment increased by 160,000.  With all of this said, as consumer spending increases, the Fed will likely feel pressure to raise the interest rate. Also, of course, the market and consumers will base confidence somewhat on the upcoming presidential election.

Sources: Wall Street Journal,, University of Michigan, The Conference Board, U.S. Commerce Department, U.S. Bureau of Labor Statistics

Week of March 21st - 25th

Unemployment Rate Recovery By State

  • What is it? Jobs recovery by state since the height of the “great recession” compared to February, 2016.
  • What does it mean? The total U.S. unemployment rate in October, 2009 was at double-digits at 10 percent compared to February 2016’s unemployment rate of 4.9 percent. All 50 states have shown improvement since that time. Michigan had the highest unemployment rate October, 2009 at 15.1 percent and has also shown the most improvement by decreasing to 4.8 percent, a change of 10.3 percent. Other states showing great improvement are Rhode Island, Nevada and California, all states that really struggled during the recession. At that time North Dakota had the lowest unemployment rate (4.2%) and now sits in second place at 2.9 percent. In first place currently is a tie between South Dakota and New Hampshire, both at 2.7 percent.
  • What's driving this? Michigan suffered more than most states during the recession due to a decline in the auto industry. While Michigan’s February unemployment rate of 7.7 percent is still the 6th highest in the country, the state has improved drastically since the recession. Most of it’s job gains came from manufacturing (the auto industry is back), trade, transportation, utilities, construction, leisure and hospitality services. Even though Michigan has added jobs, the labor force also decreased by 300,000 since 2007 as people have retired or left the state.

Sources:  Business Insider, U.S. Bureau of Labor Statistics, Michigan Live

Week of March 7th - 11th

The Economics of the NCAA "March Madness" Basketball Tournament

  • Some "Mad" facts:
    • The estimated economic impact on the host city for the Final Four (this year it’s Houston) is $300 million, with an estimated 70,000 fans visiting the city. Each fan visiting is expected to spend $2,100 on average for lodging, food and transportation for the 2016 tournament.
    • $1.9 billion in lost productivity is projected due to workers interest in the games during work hours.
    • $10.8 billion paid by CBS to acquire TV rights for the tournament for the years 2011-2024.
    • $1.1 billion in TV ad revenue is anticipated.
    • $1.5 million is the average price of a 30-second ad.
    • 28.3 milllion viewers watched the title game in 2015.
    • $9 billion (double the amount bet on the Super Bowl) is the estimated amount wagered on the 2015 tournament.
    • $60 million Americans fill out NCAA tournament brackets.
    • The retail price of an all-sessions pass to the 2016 Final Four ranges from $437 to $5,700.
    • Shares of Buffalo Wild Wings, with sales of $94 million during 2015’s March Madness tournament,  have outpaced the S&P 500 index by an average of 5.8% each March in the past 10 years.
    • With all of this said, the NCAA estimates that only 3 percent of men’s basketball programs generate surpluses. Below is a chart of the seven athletic programs that bring in the most money:

Sources:, CBS News,, Bloomberg

Week of February 22nd - 26th

Purchasing Managers' Index

  • What is it? Markit, a financial information services company, publishes their Purchasing Managers’ Index (PMI), which tracks business conditions in over 30 countries including the U.S. An index greater than 50 indicates expansion while an index less than 50 indicates retraction. Their U.S. Manufacturing and Service Industry reports were released this week and may indicate a “crack” in the U.S. economy.
  • What does it mean? The manufacturing index for February is 51.0, down from January’s index of 52.4 and tied for the lowest level since September 2009. The service sector index fell below 50 to 49.8, the lowest since October, 2013. News sources seem to think these figures could indicate a retraction in the U.S. economy. Markit’s Chief Economist, Christ Williamson, said that Wednesday’s data shows “a significant risk of the U.S. economy falling into contraction in the first quarter.” According to Bloomberg Business, “the biggest part of the U.S. economy (the service industry) is showing signs of cracking.” Business Insider says, “We just got the clearest sign yet that something is wrong with the U.S. economy.” Is the sky about to fall? Probably not. Other economic indicators like job growth and consumer spending continue to grow.
  • What's driving this?
    • Disruptions related to heavy snowfall on the east coast were a factor.
    • Business confidence has reached the lowest level since August 2010 in the service sector.
    • Uncertainty and concern regarding the global economic outlook, the stock market, the upcoming presidential election and the interest rate policy.

Sources: MarkIt, Bloomberg Business, Business Insider

Week of February 8th - 12th

The Economics of Valentine's Day (The 'Cost of Loving')

  • What is it? A composite of data from several sources.  One study by Economist Intelligence Unit compares cities around the world on the cost of a romantic “mini-break”.  Another survey by compares Valentine’s Day spending by state in the U.S.
  • What does it mean? According to the National Retail Federation, Americans will have spent approximately $20 billion for Valentine’s Day this year. According to the Economist, the city with the highest “mini-break” cost in the world is New York City at $1,158 for one night in a 4 or 5 star hotel, a three-course meal for two, 2 drinks at a hotel bar, one bottle of champagne and a taxi from and to the airport. The least expensive city in the world is Sofia, Bulgaria with a total cost of $226. Because this list included larger cities around the world, Omaha didn’t make the list, but comparing Omaha’s cost of living index to other cities on the list, the estimate is around $413. According to the’s survey, the average Nebraskan spent $51 for the Valentine’s Day holiday, compared to a $91 average for the entire U.S.  According to the National Retail Federation, the U.S. spending average is a higher figure at $146.84, has increased for seven consecutive years and is 20 percent higher than spending in 2008.
  • What's driving this?
    • A mini-break in New York is the most expensive mainly due to hotel costs.  New York has the second highest hotel costs in the world after Doha, Qatar.
    • Among U.S. cities, New York was the most expensive in every category except the cost of taxis and champagne.  Cleveland has the highest taxi costs at $170. The most expensive bottle of Champagne is found in Los Angeles.
    • According to Vox, 34% of people say they take their date out to dinner while 27% prefer to stay home and watch Netflix.
    • 37% said they did not buy a gift for their Valentine.  The amount spent on gifts decreases the longer the relationship from an average of $76 for the first five years to an average of $49 after 20 years.

Sources: The Economist, Vox,, National Retail Federation

Week of January 25th - 29th

Is Industrial the New Commercial Real Estate Darling?

  • What is it? An article, “The Industrial Age”, by Andrew Nelson, U.S. Chief Economist for Colliers International.
  • What does it mean? According to the Urban Land Institute’s annual industry survey, the industrial sector ranked first for both investors and developers in the U.S. for two years in a row. Apartments  are also performing strongly with record prices, rents and occupancies. The office sector is showing a more moderate pace of recovery while the retail sector still struggles. As in our local market, demand is high for warehouse space while new supply has only increased less than 2.5 percent in the last five years. As shown in the chart above, Real Capital Analytics, another source of sales velocity, indicates that industrial sector sales in dollars increased 54 percent year-over-year while the number of properties sold increased 33 percent year-over-year.
  • What's driving this?
    • Brick and mortar retail stores are now competing with direct-to-consumer e-commerce, driving up the space needed by retailers for warehouse space.
    • Warehouse space is in demand from construction companies needing space to store their materials.
    • Both imports and exports continue to increase and have tripled their share of the U.S. GDP from 10% in the 1960s to almost 30% now.
    • Increased demand plus little new inventory is leading to the lowest vacancy rates since the late 1990s.
    • Low vacancy rates are leading to higher rents, which translates to financial out-performance for the sector.
  • To read the full Colliers International report, follow this link: Colliers Knowledge Leader

Sources: Colliers International, Real Capital Analytics


Week of January 11th - 15th

Colliers International 2016 Global Investor Outlook

  • What is it? A survey of real estate investors conducted by Colliers International regarding 2016’s commercial real estate investment across global markets.
  • What does it mean?
    • Risk:
      • 54% of investors indicated they plan to expand their portfolio in the next 12 months.
      • 44% of investors indicated they plan to take more risk in the next 12 months.
      • 82% of investors indicated they are likely to use debt in the next 12 months.
    • Preferred Sectors:
      • The most preferred sector is CBD office product, with 61% of investors indicating they plan to invest in the next 12 months.
      • The least desirable sector is leaseholds, with only 7% of investors indicating they plan to invest in the next 12 months.
    • Target Cities:
      • The most desirable city to invest in real estate is London, with 54% of cross-border investors indicating this will be their primary area of investment and 8% indicating this will be their secondary area of investment.
      • The least desirable city to invest in real estate is Singapore, with only 17% of cross- border investors indicating this will be their primary area of investment and 11% indicating this will be their secondary area of investment.
  • What's driving this? The report cites six key themes driving the results of the survey:
    • Real estate continues to grow its appeal.
    • Liquid markets are still preferred.
    • Investors are seeking value.
    • The risk appetite of investors has moderated.
    • More investors will partner with local expertise.
    • More investors will use debt to finance their acquisitions.

To read the full report, follow this link: Colliers Global GIO Report

Source: Colliers International

Weekly Updates - Economic News

  • What is it?
    A survey conducted by brokers at Colliers International|Omaha regarding 2016’s commercial real estate outlook for the Omaha market.
  • What does it mean?
    • Downtown Omaha Office Market
      92 percent of brokers think absorption will be negative for the year, primarily due to Pacific Life’s relocation to Aksarben Village and the uncertain future of the downtown ConAgra campus. Majority results indicate this negative absorption will result in a higher vacancy rate and flat rents. 41 percent of brokers believing that landlords will need to up their concessions to attract office users to fill up the new supply.

    • Suburban Omaha Office Market
      Brokers unanimously believe the suburban market office will have positive absorption next year as new construction projects are completed and then filled by demand seen in 2015. While they all agree on absorption, the decision is split on the vacancy rate. New supply added to the market may keep the vacancy rate close to 2015 rates. 58 percent of brokers believe rental rates will increase as there is still demand for Class A space. Half of the respondents believe landlord concessions will be close to 2015 levels.

    • Omaha Industrial Market
      92 percent of brokers believe rental rates will rise in the new year in response to tight supply and the subsequent need for new construction. The majority of brokers feel that net absorption for the year will be positive but the vacancy rate will hold steady due to a continued lack of supply.

    • Omaha Retail Market
      100 percent of brokers believe landlord concessions will be flat in 2016 as compared to 2015. In general, the majority of brokers indicate that there will not be much change in the Omaha retail market in 2016.

  • What's driving this?
    • Omaha Downtown Office Market
      • “ConAgra rents will drive up the overall rental rates.” – Kyle Peterson
      • “With Pacific Life relocating to Aksarben Village, 100,000 additional square feet are now available in the 1200 Landmark Building. Additionally, it is expected that ConAgra will vacate some 250,000+ square feet in 2016 in the CBD.” – Barry Zoob
      • Backfilling Pacific Life’s space in Landmark will be a challenge, but NICO’s continuing expansion of the Omaha World-Herald building will balance much of their move. The ConAgra campus is still undecided but most likely will have a negative impact on downtown occupancy rates.” – Brinker Harding
      • “Overall 2016 will be a positive year for commercial real estate, with the 'advantage' remaining on the Landlord’s side.” – Michael Miller
    • Omaha Suburban Office Market
      • “The Class A market is the tightest it’s been in years. It’s a great time to be a Class A landlord.” – Ed Fleming
      • “Most of the new product will deliver in the first quarter of 2016. It will be interesting to see how much suburban office is either planned or under construction at the end of 2016.” – Kyle Peterson
      • “Net absorption will increase as there are several large tenants looking to occupy space in the suburban market in 2016. Occupancy will also commence in several newly constructed buildings to include the Advent Building and the Berkshire Hathaway Real Estate Building.” – Barry Zoob
      • “It will be hard to push occupancy rates too much higher since there is not enough supply for the demand. Interest, especially toward better product, will continue to put upward pressure on rates and downward pressure on landlord concessions.” – Brinker Harding
    • Omaha Industrial Market
      • “We should finally see the rental rates take a sizable jump up given new construction.” – Kyle Peterson
      • “Well located warehouse space will remain hard to find. Growth will continue along the I-80 and Hwy 370 corridor when entering the market for space. The market will remain tight and competitive continuing to push sale prices and lease rates higher.” – Alex Epstein
      • “The market seems ripe for speculative buildings.” – Colm Breathnach
      • “The vacancy rate will remain relatively flat as speculative construction increases and the industrial market sees new businesses enter the market in 2016.” – Matt Edney
    • Omaha Retail Market
      • “It will be interesting to see what happens to some of the grocery space that has come on the market and whether or not it will remain retail or be re-purposed.” – Chris Mensinger
      • “Some big groceries have to shake out yet.” – John Waldbaum

Source: Colliers International | Omaha



Week of November 16th - 20th
Commercial Real Estate Outlook

  • What is it? A report published by Deloitte, studying the trends that affect the Commercial Real Estate industry.
  • What does it mean? This is a forward-looking report identifying four main “disrupters” that will affect the CRE industry going forward; 1) collaborative economy, 2) disintermediation of brokerage and leasing, 3) war for talent, and 4) last mile.
  • What's driving this?
    • Collaborative economy is defined by wikipedia as “peer-to-peer-based sharing of access to goods and services coordinated through community-based online services.” reports that the collaborative economy grew 25 percent this past year. Examples of collaborative businesses are Uber and Airbnb. Such applications are emerging in the CRE sector. WeWork leases large office spaces and then turns around and sub-leases them. Other companies such as LiquidSpace, Regus and Desks Near Me provide short-term office space. Storefront is the retail equivalent, offering short-term space to retailers.
    • Disintermediation of brokerage and leasing refers to the removal of the “middle man” (brokers) from the process bringing tenants/buyers and landlords closer together. Technology has created an environment where property information is directly available to tenants and buyers without having to use an intermediary.
    • A war for talent is going to take place in the next 10 years due to slow growth in the U.S. population, the retirement of baby boomers and the work-force move in general to STEM and health care jobs. Millennials will comprise 75 percent of the workforce by 2030. These workers prefer an open and flexible work environment. Many will work from home. An estimated 40 percent of workers will be freelancers, temps, independent contractors and solopreneurs by 2020. These trends will move businesses toward mixed-use spaces that include office, residences and retail.
    • Last mile refers to getting products to consumers more quickly in the growing on-line retail industry. This trend will create more of a demand for industrial space and less demand for brick and mortar retail store, though those stores will still remain important to customers for products that require a “touch and feel.”

In closing, as in all industries, CRE professionals will want to grow and change as the industry changes if they want to remain competition. More specifically to the CRE industry, relationships will be more important that ever. Business leaders will still desire the advice from and expert at some point. They will want  to turn to a leader the CRE they can trust.

Source: Deloitte, Wikipedia,,


    Week of November 9th - 13th
    The Economics of Thanksgiving 2015


    • What is it? Stats from several sources regarding Thanksgiving costs and spending this year.
    • What does it mean? In September, grocery prices overall increased by a low 0.8 percent since the same time last year. However, some items that are commonly found on a U.S. table on Thanksgiving are increasing at a much higher rate. According to the National Turkey Federation, the wholesale price of turkeys is up 20 percent this year. Heavier than usual rain earlier this year resulted in 50 percent fewer pumpkins, causing speculation of a pumpkin shortage this year. Eggs, another main ingredient in pies, cost 50 percent more than in May. For those that will travel for the holiday, gas prices are the lowest they’ve been since 2008 and 72 cents per gallon less that a year ago. More and more retailers are now opening Thanksgiving evening instead of waiting until Black Friday. Black Friday is still a very important spending day for retailers, however total spending on this day peaked in 2011 at $52.4 billion and has decreased in the following years.
    • What's driving this? The bird flu is to blame for price increases for both Turkeys and eggs. The outbreak killed 8 million turkeys this year. Even so, many grocers will sell turkeys at a loss to lure shoppers in to their stores in hopes they will buy all of the other items they need for their Thanksgiving dinner. Even with pumpkin and egg price increases, Wal-Mart is selling their pumpkin pies at $3.48 this year, down 50 cents from last year. Libby, the market leader for canned pumpkin, still expects canned pumpkin supplies to last through Thanksgiving. While there is no current estimate for Black Friday shopping, total holiday spending for 2015 is projected to jump 3.7 percent. According to a Deloitte survey, 52 percent of consumers say they’re relying less on Black Friday shopping, indicating they are waiting longer for deep discounts.


    Week of October 26th - 30th
    2015 Holiday Spending Survey


    • What is it? The National Retail Federation conducts an annual survey regarding spending habits of consumers for “winter holidays” (Christmas, Hanukkah & Kwanzaa).
    • What does it mean?Consumers will spend an average of $594.80 on gifts for friends and family, up 10.26 percent from 2004 but down 0.04 percent from last year. Consumers will spend an average of $210.85 on other holiday related items, such as food and decorations. This figure is up 31.35 percent from 2004 and 1.67 percent from last year. Consumers answered that they will purchase an average of $131.59 on “non-gift” items. These are items that consumers buy for themselves, taking advantage of the many deals and discounts available during the holiday season. (I am personally guilty of this one.) This category showed the biggest increase at 47.87 percent greater than 2004 and 4.13 percent greater than last year.
    • What's driving this? Shoppers are using the internet to shop around and find the best price for items before purchasing. Almost half (46.1%) of buying and browsing for holiday items will be done online. A newer trend that consumers will take advantage of is the ability to find something online, pay for it and pick it up in the store. 46.5 percent of respondents indicated they would take advantage of this feature. 21.4 percent of respondents indicated they plan to use their mobile devices to purchase holiday merchandise. 37.9 percent answered that they will use their mobile device to research products. When shopping, sales and price discounts still hold the biggest weight with 73.1 percent of respondents indicating this is the most important factor in their decision of where to shop. When shopping online, free shipping or shipping promotions is the most important factor, 46.7 percent say.


    Week of October 12th - 16th
    Best States for Business and Careers


    • What is it? Forbes annually ranks states on their business climate. Nebraska ranked third in the nation this year, up from seventh last year. Nebraska is in the top five for the first time.
    • What does it mean? Forbes ranks states in 40 data points across six main areas: business costs, labor supply, regulatory environment, economic climate, growth prospects and quality of life. The most weight is given to business costs which include labor, energy and taxes. Ahead of Nebraska, Utah ranked first and North Carolina ranked first in the nation.
    • What's driving this? In regard to Utah, it has become a lower cost alternative to California for technology companies. Ebay, Oracle, Microsoft and Twitter have a heavy presence in the state. North Carolina has labor costs 10 percent below the national average, due to having the smallest union workforce in the U.S. Nebraska’s fiscal health had much to do with its ascent in to the top five. Nebraska has the lowest ratio of long-term liabilities to assets in the U.S. Nebraska’s legal climate also fares well for the state. Nebraska ranked third on Legal Reform’s Ranking of States report. Nebraska’s weak spot is the ability to find workers, due to the low unemployment rate of 2.6 percent. See the chart above to see how Nebraska’s neighboring states compare.


    Week of October 12th - 16th
    3rd Quarter Sneak Peek


    • What is it? Vacancy and absorption for the office, industrial and retail markets as reported by Xceligent. Our official Colliers Trends reports will come out later in the month, but a snapshot of the quarter is found below.
    • What does it mean? All three markets show healthy vacancy rates with office, industrial and retail standing at 12.4 percent, 2.7 percent and 7.4 percent vacancies respectively. On the office side, all submarkets that fall adjacent to Dodge Street show vacancy rates below the average. In particular, Suburban West Dodge and Miracle Hills boast low vacancy rates of 3.1 percent and 3.6 percent, respectively. The West Sarpy County industrial submarket is still performing strong with the low vacancy rate of 1.4 percent. The South Central retail submarket fell to 5.3 percent vacancy for the quarter.
    • What's driving this? Office submarkets anywhere near Dodge will continue to perform strong due to the ease of access via the expressway, the strength of existing class A office parks and planned office parks along this corridor. On the industrial side, West Sarpy County provides easy access to the I-80 corridor and an ample supply of agricultural land just waiting to be developed. Big deals in the South Central retail submarket contributed to it’s low vacancy rate. Hobby Lobby leased 65,000 square feet at the former Bag ‘N Save on the northwest corner of 76th and Dodge while Best Buy leased 40,460 square feet on the northeast corner of the same intersection.


    Week of September 28th - October 2nd
    2015 Predicted Halloween Shopping


    • What is it? The International Council of Shopping Centers (ICSC) conducted a survey of U.S. consumers regarding their planned shopping activity during the 2015 Halloween season.
    • What does it mean? A majority (79%) of U.S. consumers plan to purchase Halloween-related items this year with 76 percent responding they plan to spend the same or more this year than last year.
    • What's driving this? The majority (765) of households indicated they would be shopping for candy and other food and beverages. Obviously, consumable items will be purchased more often than decoration or costumes that can be used more than once. Most respondents (73%) prefer discount stores, such as Walmart and Target, as their shopping venue for Halloween purchases. Many cited the convenience of a one-stop shopping environment. Internet shopping for Halloween is only 14%. Respondents indicated they wanted to see the items in person and be able to try on costumes.  The quick facts are:
      • The most popular purchases households plan to make:
        • Candy and other food and beverages – 76% of households
        • Household decorations – 44%
        • Costumes – 39%
      • The most popular shopping venues:
        • Discount stores – 73%
        • Grocery stores – 51%
        • Clothing or Halloween/costume stores – 24%
        • Chain drug stores – 24%
        • Online – 14%
      • The top Halloween costumes
        • Superheroes (boys 17 and under) – 12%
        • Princesses (girls 17 and under) – 12%


    Week of September 21st - 25th
    Layoff Announcements


    • What is it? A series of announcements by local and national companies that they have or will be laying off employees.
    • What does it mean? Recent conversations have often included the following comment/question, “I thought the economy was improving. Why are all of these companies laying people off?” The answer depends on the company. Some are affected by changes in the energy sector. Some are older companies in older industries needing to “right the ship.” Others are correcting previous bad business decisions. Sometimes layoffs are due to the economy of other countries. All are attempts at running a business more productively and cutting the “fat.”
    • What's driving this? Union Pacific Railroad, Caterpillar and Halliburton are all directly affected by lower fuel prices and alternate sources of energy. As oil prices go down, companies use alternate forms of transportation, reducing car loadings for the railroad. Additionally, the demand for coal is decreasing as more utilities are using natural gas, a more clean and green form of energy. This reflects the “new normal” green business environment in the U.S. and will continue. Union Pacific is reacting to these conditions to remain profitable. The question remains as to how many jobs “green” energy will created to replace eliminated jobs. The food industry is a slow-growth sector, with not much room for increased margins. Both Kraft Heinz and ConAgra Foods have adopted a zero-based budget system, which means that managers must start from scratch each year. Previous year line items are not automatically approved. This is one way these companies are cutting unneccessary expenses to keep costs lean. Some companies made bad decisions that now are being corrected. ConAgra purchased a private label business in 2013 while still trying to grow and market their own brands. This proved difficult and now the private lable division is up for sale. Previously purchased software, consulting and data analysis companies purchased by Hewlett-Packard are now being spun off to focus on personal computer and printing operations. In the case of Caterpillar, the downturn in the Chinese economy has directly affected their bottom line. At the heart of all of these decisions is running a company “lean” and reacting to current business conditions. These are specific examples of layoffs. However, the U.S. economy as a whole is still improving. Specifically, U.S. jobless claims dropped 6,000 to 275,000 in August, with the number of Americans getting laid off from their job near the lowest level in decades (see the chart above). Our local economy may be affected, but I believe it to be temporary as Omaha usually weathers these challenges with flying colors.


    Week of September 7th - 11th
    The Economic Impact of NFL Football


    • What is it? An aggregate of several measurements regarding NFL related spending from various sources.
    • What does it mean? According to Gallup, NFL football is, by far, the most popular spectator sport in America. This means that come fall, many Americans are spending money on ways to watch football (NFL Sunday ticket, sports bars, etc.), TVs, fan gear, food, and tickets. The impact on cities that host teams is significant as well. With the threat of the Rams potentially moving to Los Angeles, a new $1 billion stadium on the Mississippi riverfront is being proposed in hopes of keeping the team in St. Louis. Local experts estimate that the building of the new stadium would produce 3,600 full time jobs over three and a half years, resulting in $13.5 million in payroll taxes to the area. Player salaries and ticket sales would also result in $20 million in taxes. The Rams' current location, Edward Jones Dome, could now be used for other uses, resulting in $20-$25 million in revenue.
    • What's driving this?
      - Stadium Construction Costs: The newest NFL stadium, Levi’s stadium, home of the San Francisco 49ers, cost $1.3 billion. U.S. Bank Stadium, the under-construction future home of the Minnesota Vikings, is estimated to cost $1.06 billion. The planned Mercedes-Benz stadium, future home of the Atlanta Falcons, is estimated to cost $1.2 billion. In the prior decade the average cost of an NFL stadium was $500 million. Part of the inflation here is due to the costs of the latest and greatest technology (thanks Jerry Jones). Who has the largest screen, the best wifi, the best app and the best infrastructure for future technology? That will be a moving target, driving prices higher and higher. As older stadiums become “substandard”, pressure will build for tax payers to help pay for bigger and better houses for their teams.
      - NFL Revenue: With more expensive stadiums come higher ticket prices and advertising fees. Fans and sponsors are paying. Total annual revenue of all NFL teams for 2013 was $9.58 billion, 16.8% of the total revenue of $56.88 billion for the entire North American sports market. It is predicted that annual revenue for 2015 will be $12 billion. The top five sponsors are Verizon, Pepsi, Anheuser-Busch, Microsoft and Hyundai with spending of $250 million, $200 million, $100 million, $100 million and $50 million, respectively. The team with the highest average ticket price is Seattle Seahawks at $438.09, while the cheapest tickets can be purchased in Kansas City for an average of $125.45.


    Week of August 31st - September 4th
    Mid-American Business Conditions August, 2015 Report


    • What is it? The Mid-America Business Conditions Index is published by Ernie Goss at Creighton University and measures the economy of a nine-state region including Nebraska. The index takes in to account new orders, production, delivery lead time, employment, inventories, prices and business confidence. The index is a number between 0 and 100 with numbers over 50 representing an expanding economy for the next three to six months.
    • What does it mean? The August index measured at 49.6, the first time since December, 2012 the index came in under 50, indicating week or negative growth for the 4th quarter of 2015. Nebraska’s index fell below 50 for the second straight month.
    • What's driving this?
      - Employment is up to 52 from last month’s 50. Since January, non-farm jobs as a whole are up, while manufacturing, agriculture and energy jobs are down.
      - Wholesale Prices is down to 47.6 from 57.6 in July. Low agriculture and energy prices drive this component as well. This is the lowest inflation level since May 2009.
      -  Confidence is down to 47.7 from 52.4 in July. Agriculture and energy are at play here also, as well as global economic uncertainty.
      -  Inventories is down to 41.7 from 55.1 in July.
      -  Trade is up to 50 from 47.4 in July. Export orders rose for the month.
      -  New Orders are up to 53 from 48.3 in July.
      -  Production or Sales is flat at 47.4, unchanged from July.
      -  Delivery Speed of Raw Materials and Supplies rose to 54 from 52.4 in July.


    Week of August 24th - 28th
    The Economics of Back-To-College


    • What is it? National back-to-college spending data as reported by the National Retail Federation (NRF).
    • What does it mean? Last week we explored the economics of back-to-school. This week we look at back-to-college data. Some of the trends are slightly different. Shopping for back-to-college is slightly different in that bedding, computers, etc. are on the list. However, one trend is the same. Consumers are influenced more by online promotions than in 2009. Only 19.2 percent of respondents indicated that they are 100 percent finished with their back-to-college shopping, down from 23.4 percent last year. 24 percent of respondents indicated they haven’t started shopping at the time of this survey, down from 26.2 percent last year. 46.3 percent of respondents indicated they will shop for back-to-college items at discount stores, 38.8 percent at department stores and 37.1 percent will shop online. 42.3 percent of respondents said they were influenced by coupons.
    • What's driving this? Consumers are waiting even longer for back-to-college shopping than back-to-school shopping in general 70.2 percent report they were influenced by coupons, sales and promotions, down from 77.9 percent last year. When asked what type of promotions they are most influenced by, families reported that 42.3 percent were influenced by coupons, 27.6 percent by in-store promotion, 26.2 percent by advertising inserts, 24.3 percent by word of mouth and only 14 percent by television ads. The number of respondents that shop online has increased by 13 percent since 2009, while the number of people that report to shop at discount stores has decreased by 1.7 percent. When asked about methods of promotion, not surprisingly older, more traditional means of advertising have decreased during the same period. The number of respondents that reported being influenced by newspaper advertising dropped 8.9 percent since 2009. TV promotion dropped 7.1 percent during the same period, while digital/electronic methods increased. 18.7 percent of respondents said they were influenced by email advertising, 14.4 percent by promotions on Facebook, 14.3 percent by coupon websites such as Retail Me Not, and 11.3 percent by retailers websites. The times, they are a changin’. Consumers can now find the best deals at their fingertips, whether they purchase online or look for promotions online to use in brick-and-mortar stores.


    Week of August 17th - 21st
    The Economics of Back-To-School


    • What is it? National back-to-school spending data as reported by the National Retail Federation (NRF).
    • What does it mean? Most families (50.4%) report that they have completed just half of their shopping, which is up from last year (49.9%). Fewer people (19.5%) than last year (23.6%) report they haven’t yet started their shopping. An even smaller number of families (13.3%) report they have completed their back-to-school shopping. Most families (53.4%) reported shopping at discount stores, while 46.8 percent shopped at department stores, 36.6 percent shopped at clothing stores and 12.8 percent shopped at electronic stores.
    • What's driving this? Consumers are waiting for the good deals such as late summer promotions and sales tax holidays. Of those families that have already started their back-to-school shopping, 51.3 percent report they were influenced by coupons, sales and promotions. When asked what type of promotions they are most influenced by, families reported that 43.4 percent were influenced by coupons, 35.3 percent by in-store promotions, 31 percent by advertising inserts, 21.5 percent by word of mouth and only 19.4 percent by television ads. Since the NRF started measuring these statistics in 2009, where people shop and what influences them has changed. The number of respondents that shop at discount stores has decreased by 8.8 percent since 2009 while the number of respondents that shop at office supply stores has increased by 7.2 percent during the same period. Over the past few years office supply stores have really gotten in the back-to-school game with deep discounts. Of the promotion venues that influence buyers, 13.5 percent fewer people are influenced by newspaper ads while 3.7 percent more are influenced by email advertising than in 2009. Not surprisingly, fewer and fewer people subsribe to the newspaper now than in 2009, while the majority of people have purchased products online, resulting in receiving ads from these retailers right in their email inbox.


    Week of August 3rd - 7th
    2015's Best & Worst Large Cities to Live In


    • What is it? Rank of U.S. cities with 300,000+ population as conducted and reported by WalletHub.
    • What does it mean? Cities were ranked on four main categories: Livability, Education, Health and Local Economy & Taxes. Those four main categories are comprised of 31 metrics overall. Omaha ranks 16th on the list. Some metrics are weighted higher than others.
    • What's driving this?Contributing to Omaha’s score is its third place rank for “Livability” and, more specifically, its third place rank on the “Best Cities for Recreation” list. Overall, Omaha ranked first for the cost of recreation and for the quality of its parks. To break it down further, Omaha ranked fourth on the “Most Tennis Courts per Capita” list. Also contributing to Omaha’s overall score is its fourth place rank for “Local Economy & Taxes”. Omaha ranked as the seventh on the “Best Cities to Find a Job” list.


    Week of July 20th - 24th
    Omaha Metro Commercial Sales: 2nd Quarter 2015


    • What is it? The value in dollar amount and the number of transactions for commercial, industrial and multi-family property sales in Douglas, Sarpy and Pottawattamie counties.
    • What does it mean? Seven of the top ten sales were $10 million or greater, with the top five $20M or greater. Five of the top ten sales were multi-family deals, four were retail and one was land. Nine of the top ten deals were investment deals and one, Hobby Lobby’s purchase of the former Bag ‘N Save at 76th & Dodge, is an owner-user. The largest sale for the quarter was the sale of Fountain View Senior Living at $38,210,434. Seven of the top ten sales from $10 million or greater and the top five were $20 million or greater. The buyer, Griffin-American Healthcare REIT III, also purchased the Ridgewood Senior Living facility in Bennington. The second largest sale was $27.4 million for part of the Market Pointe Shopping Center (includes Lowe’s, Kohl’s, two 12,410-square-foot strip centers and Arby’s). The center was purchased by Inland Real Estate Income Trust, Inc. The third largest sale of the quarter was Grandridge Apartments for $23,178,011. The buyer was Read Property Group LLC out of Brooklyn, NY. The fourth largest sale was Ridgewood mentioned above. The fifth largest sale was a 56.526 percent share of Regency Court shopping center by a local group for $20,349,360.
    • What's driving this? Commercial sales in the Omaha metro are up as a whole. Total sales for 2012, 2013 and 2014 were $411.8 million, $459.9 million and $594.3 million, respectively. As of the second quarter, sales have already reached $541.9 million, almost the amount for the entire year of 2014. Also, of the ten largest deals, all but one were investment deals and most were purchased by investors outside the Omaha metro. Outside investors are viewing Omaha as a good investment. In particular, multi-family sales are believed to be a good place to invest. For example, the two senior living properties purchased by Griffin-American Healthcare REIT III were 100% occupied at the time of sale. This is a national trend as well. According to Multifamily Executive, 2015 apartment sales are on pace to beat 2006 nationally.

    Sources: Colliers International|Omaha,


    Week of July 13th - 17th
    The Relative Value of $100 by State


    • What is it? The value of goods that $100 can buy in each state compared to the national average, as published by the Bureau of Economic Analysis.
    • What does it mean? The best “bang for your buck” can be found in Mississippi, with a relative value of $115.21. The biggest drain on your wallet occurs in Washington D.C., with a relative value of $84.96. The difference between the high and low is 36 percent. Basically, a person making $50,000 per year in Mississippi would have to make $68,000 in D.C. to live the same lifestyle. Nebraska ranks eleventh with $110.50 relative value.
    • What's driving this? Five of the ten least expensive states are in the south: Mississippi, Arkansas, Alabama, West Virginia and Kentucky. The remaining five states in the top ten are found in the middle of the country: South Dakota, Missouri, Ohio, Oklahoma and Iowa. Not surprisingly, seven of the ten most expensive states are found on the east coast: D.C., New York, New Jersey, Maryland, Connecticut, Massachusetts and New Hampshire. The remaining three most expensive states are Hawaii, California and Alaska. While interior and southern states have lower wages, the lower cost of living sometimes creates more effective wealth.

    Sources: Bureau of Economic Analysis


    Week of July 6th - 10th
    Second Quarter Sneak Peek


    • What is it? Vacancy and absorption for the office and industrial markets as reported by Xceligent. Our official Colliers | Omaha Research & Forecast reports will come out later this the month, but a snapshot of the quarter is found below.
    • What does it mean? Both markets show healthy vacancy rates with office and industrial standing at 11.9 percent and 2.9 percent vacancies respectively. Office vacancy fell 40 basis points from the first quarter and stands at the lowest vacancy rate since the second quarter of 2002. The industrial vacancy rate was at a historically low rate of 2.7 percent in the first quarter. The second quarter marks the first time the industrial vacancy rate has increased since the fourth quarter of 2013. The office market had a very healthy net absorption of 119,721 square feet for the quarter while the industrial market experienced a net negative absorption of 69,779 square feet.
    • What's driving this? The biggest deal for the quarter on the office side was United Way’s lease of 47,449 square feet in the Former Federal Reserve building Downtown. Three additional properties had absorption of 10,000 square feet or greater. A single vacancy in the industrial market contributed to the overall negative absorption. Telmar Network Technology vacated 98,500 square feet in Council Bluffs. Otherwise, three properties experienced positive absorption of 10,000 square feet or greater.

    Sources: Xceligent


    Week of June 22nd - 26th
    The Economic Impact of the July 4th Holiday


    • What is it? Fast facts regarding the upcoming holiday from various sources.
    • What does it mean? In a nut-shell:
      • 64.4% of consumers plan to attend a cookout, picnic or barbecue for the holiday, spending of $71.23 per household on average. This figure was $68.16 last year.
      • It is estimated that a total $6.6 billion will be spent on food this year. 
      • 22.8% of consumers plan to shop for decorations, apparel, etc. 
      • 42 million consumers will travel or go on vacation during the holiday period, the highest number since 2007.
      • An estimated 150 million hot dogs, 700 million pounds of chicken and 190 million pounds of red meat and pork will be consumed on July 4th.
      • July 4th is the top beer-selling holiday of the year in the U.S.
      • Fireworks revenue was $695 million and $332 million for consumers and displays, respectively, in 2014. Consumer fireworks revenue has increased 144.7% since 1998, while display fireworks revenue has increased by 135.5% for the same period.
      • 225.3 million pounds of fireworks were consumed in 2014.
      • 42.6% of celebrants will attend a fireworks display or community celebration.
      • 11.5% of celebrants will watch a parade. • Independence Day is the 4th most popular holiday in the U.S.
    • What's driving this? The old adage, “It’s the economy, stupid” comes to mind. The unemployment rate is down. Consumer confidence is up. Gas prices are down. Conditions are an economic “perfect storm” of holiday celebration. Just remember not to blow your finger off!

    Sources: National Retail Federation, Statistic Brain, AAA, American Pyrotechnics Association


    Week of June 15th - 19th
    The Economic Impact of the College World Series (CWS) on Omaha



    • What is it? The economic impact and success of the College World Series for the Omaha metro.
    • What does it mean? Total annual attendance continues to grow in the right direction with 2014 attendance holding the record with 347,740 attendees. According to a 2007 study, the average attendee spends $140 on average, which translates to $45M to $50m annually.
    • What's driving this? 2015 represents the fifth year the College World Series will be played at TD Ameritrade Park. Clearly, the move from Rosenblatt has proven to be a good thing for Omaha. With the addition of an additional 159 rooms at Hyatt Place, the total number of hotel rooms within a 1-mile radius of TD Ameritrade park is now 2,728. When the planned Marriott is completed, adding 333 additional rooms, the total number of rooms will be 3,061. By contrast, there is only one hotel within a 1-mile radius of the former Rosenblatt Stadium with 79 rooms. In addition to hotels, the area around TD Ameritrade park has 99 restaurants, parking, the Old Market area and the Bob Kerrey Pedestrian Bridge all within a 1-mile radius. Attendance is expected to trend upward this year, with Thursday’s TCU vs. LSU game selling out and boasting the third-best crowd in stadium history.

    Sources: Omaha World Herald, NCAA, Colliers International


    Week of June 8th - 12th
    The State of College Hiring


    • What is it? A study and report conducted by Looksharp, the company behind, that aggregates the results of a survey of college students.
    • What does it mean? Omaha was first on the list of top cities most likely to have paid internships.
    • What's driving this? Simple supply and demand forces are at work here. Omaha has a low unemployment rate, making hiring of any kind a challenge. Hiring an intern while still in college could increase the chance of keeping talent here post-college. Omaha is at the top of the list for actual paid internships, but the list of most desired cities does not include Omaha. The most desired areas include large metros, with New York City, Los Angeles and San Francisco rounding out the top three. The only midwestern metro on the most desired list is Chicago. The survey asked about other factors such as preferred size of company, industry and other attributes. Most respondents prefer to intern for a medium sized company (50-500 employees). The top preferred industry is marketing/PR/advertising/graphic design, while the top major with the higher likelihood of receiving compensation is engineering. When asked what attributes are “Very Important”, the top three answers are opportunities for long-term career advancement, relevance to my major/minor and access to executives and mentorship. Work-life balance came in fourth, moving up a spot from the 2014 survey. For the average hourly intern pay rate, see the chart above.



    Week of May 25th - 29th
    Housing Prices


    • What is it? Two home pricing indices; the S&P/Case-Shiller 20-city composite home price index and the Federal Housing Finance Agency (FHFA) housing price index, compared to median new home sale prices.
    • What does it mean? The Case-Shiller composite measures the value of residential real estate in 20 major U.S. metropolitan areas. The FHFA house price index measures residential real estate prices for the entire U.S. Median new home sale prices are measured and reported by the U.S. Census bureau. Both indices increased month-over-month from February to March. The Case-Shiller index increased by 0.92 percent to 175.2, the highest level since February, 2008. The FHFA index increased by 0.34 percent to 221, the highest level since March, 2008. Median new home prices increased March to April by 4.13 percent to $297,300, the highest value in history.
    • What's driving this? All 20 cities measured in the Case-Shiller index experienced increased home prices year-over-year. Cities with the highest annual increases are San Francisco (10.3%), Denver (10.0%) and Dallas (9.3%). According to the FHFA index, 4 of the 5 cities with the highest increases are in Florida; Naples, Port St. Lucie, Palm Bay and Daytona Beach. Historically, home prices have increased around 1 percent annually on average. The three sited measurements indicate much higher rates with regard to housing prices. The Case-Shiller index increased 4.2 percent and the FHFA index by 5.16 percent since March, 2014. Median new home prices increased 8.31 percent since April, 2014. Additionally, inflation as a whole, as measured by the Consumer Price Index, only increased 1.8 percent year-over-year. All of this data poses the question: Are we approaching a housing bubble?

    Sources: S&P/Case-Shiller, FHFA, U.S. Census Bureau

Week of May 11th - 15th
Is a real estate boom on the way?


  • What is it?The volume of U.S. commercial real estate sales volume as reported by Real Capital Analytics.
  • What does it mean? The first quarter of 2015 saw $129.5 billion in commercial real estate transactions, the highest first quarter amount since 2007’s $158.1 billion and 45 percent higher than the same period last year.
  • What's driving this? According to Bloomberg, dollars from all over the globe are being invested in to U.S. commercial real estate investment properties. Driving sales volume are the sales of portfolios or entire companies. Bloomberg sites Blackstone Group and Wells Fargo’s purchase of real estate assets previously owned by General Electric for $23 billion. Real Capital Analytics states that due to the amount of money in the pipeline, the second quarter may be one of the biggest on record. According to the Dallas Morning News, real estate professionals predict that U.S. real estate investment will remain strong through 2017. They site the Urban Land Institute’s forecast of at or near $500 billion a year in transactions for the next three years. As shown in the above chart, that level hasn’t been reached since 2007.

Source: Real Capital Analytics, Bloomberg, Dallas Morning News, Urban Land Institute


Week of May 4th - 8th
April 2015 U.S. Employment Report


  • What is it? An economic news release from the U.S. bureau of labor statistics.
  • What does it mean? The overall unemployment rate was 5.4 percent for the month of April in the U.S., which is down 10 basis points from March’s 5.5 percent rate and down 80 basis points from one year ago. This is the lowest rate since May, 2008 and is 460 basis points lower than the high of 10 percent in October, 2009 at the height of the great recession.
  • What's driving this? By age, the unemployment rate is higher for teenagers than the 20 years and over group. By education level, those with a high school education or less fair worse than those with a college degree or some college. By duration of unemployment, the number of people unemployed for 27 weeks or more has decreased by 35% since this time last year. Most unemployed people are now unemployed for less than 5 weeks. By industry, education and health care services saw the largest increases with an increase 55,600 of jobs since March. Average hourly earnings also increased month-over-month from $24.84 to $24.87 for April.

Source: U.S. Bureau of Labor Statistics


Week of April 27th - May 4th
AlphaWise National Commercial Real Estate Sentiment Survey


  • What is it? A survey of approximately 250 U.S. commercial real estate brokers conducted and reported by Morgan Stanley research.
  • What does it mean? Results are mixed and indicated that the office market may have peaked nationally while the industrial market is still growing. Office broker sentiment indicates the market further changing from a landlord’s market to a more balanced market, however optimism regarding rental rates remains. Over 70 percent of industrial brokers indicate that it’s still a landlord’s market, with 71 percent stating they expect rents to rise.
  • What's driving this? Results in the office market vary by city. 80-100 percent of brokers in San Francisco, Boston and Atlanta indicate that it’s a landlord’s market, while 79 percent of brokers in Washington, DC consider it to be a tenant’s market. When brokers were asked about the drivers of activity, results were split between business growth and upgrading space. By industry, it is expected that tech, medical and smaller financial firms will expand while government and legal tenants will become less active in leasing. On the industrial side, business growth is still the biggest driver with 78 percent of respondents indicating that companies will lease due to growth in the next three months. By tenant type, over 50 percent of respondents expect growth in distributing, consumer staples, e-commerce and light industrial.

Source: AlphaWise, Morgan Stanley Research


Week of April 20th - 24th
Economic Impacts of the Ethanol Industry in Nebraska


  • What is it? A study conducted by the Agricultural Economics department of the University of Nebraska.
  • What does it mean? Nebraska is the second largest ethanol-producing state in the U.S., behind Iowa. The study shows a positive impact of the ethanol industry on the Nebraska economy. When ethanol production began in 1985, production was 9 million gallons per year. Production grew to 200 million gallons per year by 1995 and to 2,062 million gallons per year by 2011. Capacity, as of June, 2014, was 2,077 million gallons per year. This translates to a total value of $4,994 million in annual output effect. Total state employment, as of June, 2014, in the ethanol industry is 1,301 employees with $319 million labor income impact. The industry supplies $41 million in indirect business taxes to the state.
  • What's driving this? In-state consumption of ethanol makes up a small portion of supply. In 2014, 96 percent of supply was shipped out of state. Eleven states, including Nebraska, have an ethanol surplus, while 20 states have an ethanol deficit; with California, Texas and Louisiana having the largest deficits. As shown on the map above, Nebraska exports ethanol to Arizona, California, Colorado, Louisiana, New Mexico, Utah and Wyoming. While the economic impact is great, the environmental impact may not be as positive as initially thought. Another study from the University of Nebraska was released this week regarding the affect of biofuel production on the environment. The study concludes that ethanol and other biofuel production actually reduces soil carbon and can generate more greenhouse gases than gasoline.

Source: University of Nebraska Department of Agricultural Economics, University of Nebraska Department of Biological Systems Engineering, and Agronomy and Horticulture


Week of April 13th - 17th
First Quarter Sneak Peek


  • What is it? Vacancy and absorption for the office, industrial and retail markets as reported by Xceligent. Our official Colliers Forecast reports will come out later in the month, but a snapshot of the quarter is found below.
  • What does it mean? All three markets show healthy vacancy rates with office, industrial and retail standing at 12.3 percent, 2.7 percent and 7.2 percent vacancies respectively. The industrial vacancy rate is historically low. The market has never seen this lack of supply before, leaving businesses needing to expand to consider building their own properties. All three sectors also experienced positive absorption for the quarter with 73,174 square feet, 112,947 square feet and 233,151 square feet respectively.
  • What's driving this? On the office side, there were some larger deals, such as the 68,699-square-foot lease done at North Park 7A, but also there were many smaller deals signed during the quarter. In the industrial market, there were only five deals over 10,000 square feet for the quarter. The opinion, that there would be much higher absorption seen in the industrial sector with more inventory, is widely held. The big deal in retail was the completion and opening of a 186,523-square-foot Walmart Super Center in Council Bluffs. The second-largest deal was Planet Fitness’ 23,500-square-foot lease at Brentwood Square in La Vista. Beyond those larger deals, there were over 60 deals under 10,000 square feet for the quarter.


Week of April 6th - 10th
Omaha Metro Commercial Sales

  • What is it? Commercial sales volume for Douglas, Sarpy and Pottawattamie counties.
  • What does it mean? There were just under $800 million in commercial sales for the Omaha metro area in 2014. First quarter 2015 volume, $175.5 million, indicates that the market is on track to experience the same level of volume for the year.
  • What's driving this? Sales are occurring in all areas of the metro, however the West Dodge Corridor is out-performing other areas of town. Some sales are owner-users and others are investment sales.  We are seeing more out of state investors invest in the Omaha metro.  A sample of larger sales for the quarter:
    - Fontenelle Hills Apartments in Bellevue sold for $26,600,000 or $78,466 per unit to a group out of Minneapolis.
    -  The Sports Authority/PetSmart building at 168th and West Maple Road sold for $15,802,933 or $227.24 per square foot to a group out of Illinois.
    -  The former Nissan of Omaha at 115th and West Dodge Road sold for $9,930,000 or $424.54 per square foot to a local company.
    -  Britain Towne Apartments in Bellevue sold for $9,312,500 or $55,432 per unit to a group out of North Dakota.
    -  The now At Home (formerly Garden Ridge) building at 132nd and West Center Road traded for $7,989,865 or $77.34 per square foot.
    -  The Huber Chevrolet property at 111th and West Dodge Road traded for $7,680,000 or $112.61 per square foot.
    -  A multi-family portfolio in Midtown sold for $6,550,000 or $42,810 per unit to a local buyer.
    -  The new Sam’s Club in Papillion traded for $6,500,000 or $47.26 per square foot.
    -  Embassy Tower, a Class B office building at 93rd and Underwood Avenue, sold for $6,500,000 or $79.44 per square foot to a local buyer.

Source: Douglas, Sarpy and Pottawattamie County Assessors


Week of March 30th - April 3rd
February 2015 Preliminary Unemployment Rate by State


  • What is it? The U.S. Labor Department released their state-by-state unemployment data and Nebraska once again has the lowest unemployment rate in the nation at 2.7 percent.
  • What does it mean? While Nebraska has consistently had one of the lowest unemployment rates in the country, North Dakota has held the #1 spot since October, 2008. 
  • What's driving this?
    -  While Nebraska saw negative job growth in agriculture, job gains were achieved in education, health services, leisure and hospitality and other service oriented areas.
    -  Urban areas are performing stronger than rural areas, with Omaha, Lincoln and Grand Island all boasting more jobs than one year ago.
    -  Nearly 7,500 fewer people are unemployed since this time last year.
    -  North Dakota’s unemployment rate rose to 2.9 percent due to cutbacks related to plunging oil prices.
    -  The U.S. rate fell to 5.5 percent overall, with over half of the nation’s states saw a decrease in their unemployment rate in February.
    -  By region, the Midwest had the lowest unemployment rate of 5.1 percent.

Source: U.S. Department of Labor, USA Today, MarketWatch, Lincoln Journal Star


Week of March 23rd - 27th
New vs. Existing Home Sales


  • What is it? The dollar amount of new home sales vs. existing home sales are reported by the U.S. Commerce Department.
  • What does it mean? The sale of new and existing home sales increased month-over-month in February by 7.8 percent and 1.2 percent, respectively. However, sales in both sectors are down from February, 2005 by 59.1 percent for new homes and 29.2 percent for existing homes. While sales overall are not back to pre-recessionary levels, they are moving in the right direction. The sale of new homes increased 24.8 percent over one year ago, while existing home sales increased 4.7 percent for the same period.
  • What's driving this? For starters, the price of new homes has increased by 2.7 percent since one year ago while the price of existing homes has increased by 7.5 percent during the same period. According to the Wall Street Journal, price increases can be attributed to shrinking inventory of single-family homes. U.S. housing starts dropped 17 percent in February due to severe winter weather. According to the National Association of Realtors, there is about a 4.6 month supply of inventory on the market. Hopefully, warmer spring weather will translate in to construction of new homes and the sale of those homes will place more existing homes on the market as well. In some respects, conditions are ripe for home loans. 30-year conventional loan mortgage rates are still low at 3.71. However, builders site a shortage of lots and labor coupled with tight loan underwriting standards.

Source: U.S. Commerce Department, Wall Street Journal, USA Today


Week of March 16th - 20th
The Economics of the NCAA March Madness Basketball Tournament

Just the facts, ma'am... They are pretty compelling. March Madness is a pretty big deal (duh):

  1. $2 billion will be bet on brackets, with an average bet of $29 per bracket.
  2. An additional $7 billion will be bet on individual games.
  3. $9 billion combined betting is more than double what gamblers bet on the Super Bowl.
  4. 70 million people participate in March Madness pools, which is more than voted for either Obama (66 million) or Romney (61 million) in the 2012 presidential election.
  5. $800 million in NCAA licensing deals.
  6. 6-figure bonuses for coaches.
  7. Top schools earn multiple millions for their athletic departments .
  8. NCAA schools generated total revenues of over $1.6 billion in 2014.
  9. $1.9 billion will be lost in productivity.  However, some businesses incorporate activities around the tournament.  36% of U.S. senior managers say activities related to the tournament have a positive impact on employee productivity while only 15% say they have a negative impact.  50% say these activities have a positive impact on morale while only 6% say they have a negative impact.
  10. $1.1 billion was spent in commercial spots during the 2014 tournament.
  11. “The national title winner in three out of five of the college basketball seasons since 2010 has been either first, second or third biggest spender in men’s college basketball, according to an analysis of the U.S. Department of Education’s Equality in Athletics data.”
  12. Shares of Buffalo Wild Wings have outpaced the S&P 500 by an average of 5.8% points each March in the past ten years.
  13. Tickets for 2nd and 3rd rounds were $150-$600 on, but most are sold out. has tickets for games hosted in Omaha for $148.25-$483.
  14. Tickets for all sessions of the final four games in Indianapolis range from $1,635-$6,010 on


Source: The American Gaming Association,  Business Insider, International Business Times,, CBS, Memphis Business Journal, Baseline Magazine,,


Week of March 9th - 13th
CoStar Commercial Repeat-Sale Indices (CCRSI)




  • What is it? An index computed and published by CoStar that compares sales of the same commercial property with previous sales. It measures the difference in the most recent sale of a property to the earlier sale of that same property. They measure this on an equal-weighted and value-weighted basis, with the value-weighted index giving more weight to higher value sales. Within the equal-weighted index, CoStar then breaks out investment grade (larger-sized, good-quality properties) and general commercial properties.
  • What does it mean? The index is a good indicator of the health of the commercial real estate investment sales market. Both the equal-weighted and value-weighted indices increased by 1.2 percent for the month of January, 2015, with the value-weighted index reaching a record high of 186.
  • What's driving this? Value-weighted properties have seen greater price increases than equal-weighted properties as evidenced by their respective CCRSI scores of 186 and 165. Within the equal-weighted sector, general commercial properties have out-performed investment grade properties with indices of 167 and 156, respectively. The property type with both the best equal-weighted and value-weighted performance is multi-family with CCRSI scores of 204 and 193, respectively. By region, the Northeast section of the U.S. led the way on both the equal-weighted and value-weighted indices with scores of 205 and 221, respectively.

Source: CoStar Group


Week of March 2nd - 6th
U.S. Private Construction Spending


  • What is it? Monthly data released by the U.S. Bureau of Economic Analysis reporting private construction spending, which excludes government construction.
  • What does it mean? Presidential construction spending was up in January 0.6 percent while both non-residential and total private construction were down in January by -1.6 percent and -0.5 percent, respectively.
  • What's driving this? Construction in all sectors has grown overall since 2011. Overall private construction spending is back to December, 2008 spending levels. What’s interesting to note is that ten years ago, residential construction spending was more than twice as high as non-residential levels. As the chart illustrates, they are now neck-and-neck with residential spending for January reaching $351,733 million and non-residential spending ending up at $345,875 million. In comparison, in January 2005 residential spending was $565,755 million and non-residential spending was $250,158 million. Clearly non-residential construction is leading the way. Why is residential spending down 37.8 percent from ten years ago? Perhaps the “great recession” is fresher in the memories of consumers vs. businesses. Perhaps consumers are not as bullish on the economy as businesses. These figures probably have more to do with the trend of urban-living and renting vs. buying as illustrated by the younger millennial generation.

Source: U.S. Bureau of Economic Analysis, Colliers International


Week of February 23rd - 27th
U.S. Personal Income, Spending & Savings Rates


  • What is it? Data released by the U.S. Bureau of Economic Analysis.
  • What does it mean? Personal income is up 0.3 percent while personal spending is down -0.2 percent. Personal savings increased to 5.5 percent from 5.0 percent in December.
  • What's driving this? The increase in personal income marks the 13th consecutive month for earnings increases while we’ve seen two months in a row of negative spending growth. Personal savings is at the highest levels since December, 2012. Lower prices in the energy sector contributed to a decrease of -2.2 percent in spending for non-durable goods. Durable goods spending also decreased but by a much smaller amount, -0.1 percent. Spending on services increased 0.5 percent.

Source: Colliers International


Week of February 16th - 20th
Fourth Quarter 2014 North American Sneak Peek


  • What is it? Data released by Colliers International for the Industrial and Office markets.
  • What does it mean? Omaha made three lists: 5th lowest industrial vacancy rate, 5th lowest bulk industrial vacancy rate (defined as warehouse space in excess of 100,000 square feet with dock loading and minimum ceiling heights of 24 ft.), and 3rd lowest CBD office vacancy rate in North America. Little ‘ole Omaha doesn’t come close to making the most absorption lists.
  • What's driving this? Our low industrial rate has been around for a while, but is now at record low levels. Construction costs compared to current asking rents do not justify new speculative construction. We believe that rates will have to increase to stimulate new supply. The low CBD office vacancy can be attributed to the removal of office buildings from inventory due to demolition or re-purposing. Omaha will likely never make the highest absorption lists due to the size of our market. For perspective, Atlanta, GA experienced the highest industrial absorption of over 20,000,000 square feet. The size of the entire Omaha market is 68,000,000 square feet. The highest office absorption, 6,835,083 square feet, was in Houston, TX. Omaha’s entire office market is comprised of 27,929,759 square feet (including owner-occupied and medical). Our industrial market averages around 500,000 square feet of absorption annually while our office market averages around 225,000 square feet.

Source: Colliers International


Week of February 9th - 13th
U.S. Retail Sales - January 2015


  • What is it? Data released by the U.S. Commerce Department.
  • What does it mean? After ten months of positive growth, total retail sales fell 9% for two months in a row in December 2014 and January 2015. After recent positive job and income growth news, this retail spending news can pose a confusing question: is the U.S. economy slowing? Probably not. Economists speculate that consumers are using their extra income to pay down debt or to cushion their savings.
  • What's driving this? Sectors showing growth in sales are building materials, general merchandise and e-commerce. Sectors showing negative growth in sales are autos and auto parts, furniture, food, gas stations and clothing. Gas station sales fell 9.3% in January due to lower gas prices. Economists believed this would translate to higher sales in other sectors, which did not materialize. While overall sales were down, core retail sales (excludes motor vehicle dealers, gasoline stations and building material and supply stores) increased slightly at 0.2% for the month of January. While the National Retail Federation predicts overall 2015 sales to grow 4.1%, the U.S. may experience another disappointing month of sales due to “snowmageddon” on the east coast.

Source: U.S. Commerce Department, Reuters, National Retail Federation


Week of February 2nd through 9th
U.S. Job Growth


  • What is it? Data released by the U.S. Bureau of Labor Statistics.
  • What does it mean? 257,000 jobs were added to the U.S. economy for the month of January, 2015. This figure represents the eleventh straight month in a row (beginning March, 2014) of employment growth higher than 200,000 jobs, the longest consecutive streak since 1994. Since October of 2010, January also marks the 52nd straight month of positive job growth. Hourly wages were also up by 0.5 percent from December.
  • What's driving this? Job growth is broad based with industries experiencing job growth varying from construction, manufacturing, financial activities and retail. U.S. consumer sentiment rose in January to its highest level in 11 years. U.S. GDP has grown for three quarters in a row. Fourth quarter 2014 corporate earnings reports indicate an increase of 7.1 percent for S&P 500 members from the fourth quarter of 2013. 71.8 percent of these companies beat their earnings estimates. The growth in earnings is clearly translating to job growth.

Source: U.S. Bureau of Labor Statistics, Wall Street Journal,


Week of January 26th through January 30th
The Economics of the Super Bowl


  • What is it? An aggregate of data regarding spending surrounding the Super Bowl, including consumer spending, game attendance, commercials, etc.
  • What does it mean? Americans throw and attend viewing parties, or the game itself, and spend a lot of money. The National Retail Federation predicts that the average American will spend $77.99 on average, up from $68.27 last year. This figure includes all spending on food, athletic wear or even new televisions. For those actually attending the game, the average price of a ticket for Super Bowl 49 is $4,833.25, compared to the average ticket price from the past five Super Bowls of $2,830. Between tickets, hotels, food, parking, etc. it is estimated that $500 million will be infused into the Arizona economy, the hosting state. Corporations spend a lot of money also. This year, a 30-second commercial costs $4.5 million.
  • What's driving this? According to Gallup, some time in the 1960s football surpassed baseball as the number 1 spectator sport in America. Nearly two-thirds of Americans say they regularly watch football with the Super Bowl being the most watched game of all. In fact, regular season NFL games get higher ratings than Game 7 of the World Series. The 21 most-watched television programs in American history are all Super Bowls. Viewership of the big game keeps increasing every year. In 2014, 111.5 million Americans watched the Super Bowl, up from 108.6 million in 2013. That number is expected to increase this year as well. Even with the high price tag, advertisers reach an unprecedented number of consumers when advertising during the Super Bowl.

Source: National Retail Federation, Vox,, Gallup


Week of January 19th through January 23rd
The 5 Best Cities for Successful Aging


  • What is it? A study conducted by the Milken Institute on the best cities for successful aging. They studied 352 U.S. metropolitan areas, using data on health care, wellness, living arrangements, transportation, financial characteristics, employment and educational opportunities, community engagement and overall livability.
  • What does it mean? Omaha ranked second in the survey. Surprisingly, sunshine states, such as Florida and California had no cities in the top five, with Madison, Omaha, Provo, Boston and Salt Lake City taking the top five spots.
  • What's driving this? Omaha scored high in areas such as the low jobless rate, the high employment rate among mature adults, the low cost of living, availability of grocery and convenience stores, high-ranked medical facilities and recreation and volunteer opportunities. The areas where Omaha could do better are transportation resources, the rate of unhealthy habits such as smoking, binge-drinking and sugary-drink consumption, and a higher crime rate.

How does Omaha compare to cities in neighboring states? See the cart above.

Source:, Milken Institute


Week of January 12th through January 16th
The 10 Best Cities for People in Science and Tech


  • What is it? A study conducted by WalletHub on the best cities to find a job in the science, technology, engineering and math sectors (STEM), which are the fastest growing jobs in the United States.
  • What does it mean? According to the U.S. Department of Commerce, STEM jobs are expected to grow 1.7 times more quickly than other professions between 2008 and 2018. WalletHub studied the 100 largest U.S. metro areas and ranked Omaha as the fifth best place to find a STEM job.
  • What's driving this? WalletHub included the following criteria to rank metro areas: job openings per capita, percentage of STEM workers, STEM employment growth, unemployment rate, annual median wage and housing affordability. While the west coast is generally thought of as having the most tech jobs, the high cost of living offset those metros, keeping all but one (Seattle ranked sixth) off the top ten list. Two of the top ten are in Texas (Houston and Austin), one is on the east coast (Raleigh), while most (six) are in the middle (Denver, Omaha, Oklahoma City, Salt Lake City, Columbus, Cincinnati) where the cost of living is more affordable.

How does Omaha compare to cities in neighboring states? See the cart above.

Source:, U.S. Department of Commerce, Business Insider


Week of January 5th through 9th
2015's Best & Worst Cities to Find a Job


  • What is it? A study and report by on the best cities to find a job based on the local job market and socioeconomic environment.
  • What does it mean? Out the 150 largest U.S. cities, Omaha ranked as the seventh best place to find a job.
  • What's driving this? Omaha ranked 30th for the job market category.  Driving this is Omaha’s low unemployment rate, which translates to low employment growth.  As such, Omaha ranks 146th out of 150 for lowest employment growth.  Omaha ranked 5th in the socioeconomic environment category.  Driving this are Omaha’s healthy median annual income, low commute time, housing affordability and low crime rate.

How does Omaha compare to cities in neighboring states? See the cart above.



Week of December 29th through January 2nd
The Economic Year in Review

  • What is it?  A study and report from the National Retail Federation comparing pre-recession to post-recession consumer attitudes and behavior.
  • What does it mean?  In a nut-shell, consumers are spending again, but in different ways and via different venues.
  • What’s driving this?  A summary of trends found in the report:
    • Cuts in dining out, travel and apparel are still higher than pre-recessionary levels. (Women are more likely than men to cut back on dining out; the number of respondents indicating that they plan to travel has increased; clothing purchases are trending back to pre-recessionary levels with consumers focusing more on style and less on comfort and value.)
    • Cuts in movies & recreation and electronics are the same as pre-recessionary levels.
    • Consumers expect bargains. (64% of women & 61% of men responded that they usually buy clothing when it’s on sale; 25% of women & 19% of men responded that they only buy clothing when it’s on sale.)
    • Consumers are purchasing from less traditional sources (Trunk Club: personal shoppers select and send clothes directly to male customers; Rent the Runway: rents high-end clothing to female customers; and flash-sale websites such as Rue La La and Gilt). Retailers and brands that focus on style and value are very popular with today's consumers (ie. H&M, Zara, Uniqlo & Joe Fresh).
    • Media influencers have changed. The impact of newspapers and magazines are on a downward slope; the impact of direct mail is the same as before the recession; the impact of coupons and in-store promotions are on the rise. Apps, online ads, email and social media increase access to deals and coupons.

Source: National Retail Federation


Week of December 22nd through 26th
The Economic Year in Review


  • What is it? A comparison of ten top economic indicators for the year 2014 versus 2013*.
  • What does it mean? Without question, the economy moved in the right direction in all sectors, except housing starts, as compared to the previous year.
  • What's driving this? Job creation in the U.S. is at the highest level since 1999. Both the consumer price index and the producer price index increased, but both are below the “healthy” inflation rate of 2 percent annually and the “expected” inflation rate of 3 percent for the year. Gas prices are down 61 cents and global food prices are down 5 percent since last year, contributing to the low inflation rate. Moody’s projects that gas prices alone will translate into another $100 billion in the pockets of Americans.  Consumers are certainly feeling this, with a huge increase of 23.2 percent in the Consumer Confidence Index year-over-year. Business confidence is also evident, as the S&P 500 Stock Index increased 14.4 percent year-over-year. Housing starts are “flat” with a decrease of only 2 housing starts from this time last year.

Source: Moody’s, U.S. Bureau of Economic Analysis, U.S. Federal Reserve, U.S. Bureau of Labor Statistics, The Conference Board, U.S. Census Bureau, Standard & Poor’s
* Data points represent 3rd quarter or November, depending on frequency of reporting.


  • What is it? A survey of our own local commercial real estate brokers regarding the local commercial real estate market for 2015.
  • What does it mean? Some of the results are mixed, but in general there is positive sentiment across the board. The majority of our office brokers believe that sales activity will remain the same and are split on leasing activity while the vacancy rate decreases. Most of our retail brokers believe that leasing activity will increase, but are split on sales activity, and the vacancy rate will decrease. Our industrial team feels that sales activity will decrease, are split on leasing activity and believe that the vacancy rate will remain flat. A large majority of our investment group believe that investment sales will increase in our market and that cap rates will stay the same.
  • What's driving this? Below, in addition to charts representing the results of the survey, are comments from the brokers in the Colliers | Omaha team. It’s pretty clear that Class A office product will continue to perform well, prompting the need for development of new product; retailers will still be attracted to new and high-end product; that conditions are ripe for new development in the industrial market; and that strong activity will continue on the investment side. (Source: Colliers International | Omaha)

  • "With 3.2% unemployment in Omaha, there will be limited absorption in 2015. There may still remain some "trading spaces" energy." - Barry Zoob
  • "We expect 2015 to be another solid year for the office market in Omaha." - Ed Fleming   
  • "The Class A office market will continue to be very competitive, even as additional product comes to market. The Class B and C office environments will remain relatively steady as simple supply/demand will force many tenants to consider these options." - Kyle Peterson
  • "Omaha’s office market continues to see additional demand as companies expand, with little new office construction to fulfill the requirements.  Accordingly the market will see increased occupancy and the ability to complete transactions will become more challenging." - Michael Miller
  • "The office market will see measured growth in leasing velocity. Class A space will continue to be squeezed with diminishing options for larger users." - Brinker Harding
  • "The market will continue to be driven by two to three single tenant build-to-suits, and larger office transactions. The bold developers willing to spec office building will be rewarded, the more conservative developers are likely to stay on the sidelines." - Jeff Wyatt

  • “Food will continue to be the most active group in retail and A space will continue to be the most sought after with strong leasing in redeveloped and newly development retail centers" - Chris Mensinger    
  • “We will see newer developments filling in and developers looking for new projects”. - Cindi Cisar-Incontro    
  • "The retail market should have continued strength in 2015, with core markets/infill areas still seeing the most benefit." - Terry Root

  • "Due to low vacancy rates and lack of existing properties on the market, I expect the industrial segment will stall until rents rise enough to support new construction costs.  I expect that land sales will increase as more owner/users go the construction route." - Cori Adcock
  • "It's an ideal opportunity for speculative development due to the lack of inventory." - Colm Breathnach   
  • "With minimal new construction and greater demand than supply, leasing activity will remain slow with more small deals (less than 10,000 SF). With no where for buyers/tenants to go I don't see much changing as far as vacancy rates or leasing rates." - Matt Edney
  • "Lease rates are now reach the point where the construction of new space has become economically feasible. Today's low interest rates also helps the economics for new construction." - Michael Miller   
  • "More developer confidence in market demand for newer industrial buildings will yield increased new development." - Barry Zoob

  • "2014 Exceeded our expectations and we expect 2015 to be at or above 2014 levels". - Ed Fleming
  • "As Cap Rates in major markets across the country continue to be very aggressive, Tertiary markets such as Omaha will be more visible to the institutional investor." - Kyle Peterson
  • "As recently as twelve months ago there 2-3 buyers for a property that today will attract 20." - Michael Miller
  • "CRE Investment properties will remain a viable, if not preferred, alternative to other investment strategies, expecially if interest rates remain low and inflation creeps up." - Charlie Sullivan
  • "The amount of cash still sitting on the sideline, both locally and non-locally, may find its way to purchasing Omaha properties." - Brinker Harding
  • "Look to see high quality trophy properties trade in 2015 as interest rates start to increase. The other area of demand should be in low B and C value added properties which will sell well below replacement cost." - Barry Zoob
  • "Low interest rates will be chasing low cap rates. It will continue to be a seller's market, and the fat will be found in value add." - Jeff Wyatt

Week of December 8th through 12th
Broker Sentiment Survey


  • What is it? A survey of U.S. commercial real estate brokers conducted by Xceligent regarding their outlook of the commercial real estate market for the next 6 months.
  • What does it mean? Basically, brokers are optimistic about the near future. A majority of brokers from all three sectors (industrial, office and retail) predict that vacancy rates will decrease from current levels. All three sectors also agreed that lease rates will trend upward. Industrial and retail brokers agree that concessions will decrease while office brokers believe they will remain flat. Industrial and retail brokers also agree that the market will move at a good pace while office brokers mostly answered that the market will remain the same. The majority of retail brokers answered that sales volume has started to heat up while the office and industrial sectors believe sales volume to remain the same. A majority of office brokers answered that leasing activity will tick up while the industrial and retail sectors believe it will remain the same.
  • What's driving this? Vacancy rates have been trending downward in the last few quarters and economic indicators show no reason for this trend not to continue. Also, with speculative construction slowing significantly during and after the “great recession,” much of the existing inventory is being leased up, reducing vacancy rates. With less and less product on the market, landlords won’t need to continue making concessions to attract tenants and can increase rates appropriately. The cost of new construction needed to keep up with demand will also contribute to increased lease rates.

How does Omaha compare to other markets? The chart above represents responses to “Over the next six months, vacancy rates will show”: 5 – Record High Levels; 3 – Remain the Same; 1 – Record Low Levels.

Week of December 1st through 5th
Third Quarter 2014 North American Industrial Market Report


  • What is it? Colliers International released its quarterly report on vacancy, absorption, rental rates and construction for the North American industrial market.
  • What does it mean?  Nationally, the vacancy rate decreased 24 basis points to 7.5 percent from the second quarter. Over 60 million square feet of space was absorbed and the average asking rent increased 6 percent to $4.99 per square foot. In response to these positive indicators, there are over 140 million square feet of industrial space under construction in the U.S.
  • What's driving this? Energy production, manufacturing expansion, e-commerce growth, strong auto sales and rising housing starts are all contributing to high performing inland distribution and intermodal markets. As is true here in our local market, industrial absorption continues to outpace new supply, explaining the increase in asking rents.  The question remains: Will developers begin to build speculative product with higher than pre-recessionary construction costs that will surely result in higher rents? Will companies lease industrial product at higher rates for nicer, newer product?  It will have to happen to keep up with demand.

Week of November 24th through 28th
Falling Gas Prices


  • What is it? Average price per gallon of gasoline as reported by the Lundberg study.
  • What does it mean? The study reveals that the average cost of a gallon of gasoline in the U.S. is $2.84, down $0.41 from this time last year and down $0.88 from May of this year. The number also represents a five-year low.
  • What's driving this? There are several reasons gas prices are falling.
    • According to the U.S. Energy Information Administration (EIA), U.S. domestic oil production has grown from 5.6 million barrels per day in 2011 to 7.4 million barrels per day in 2013.  The EIA forecasts production for 2015 averaging 9.5 million barrels per day.
    • Americans are driving less and driving more fuel efficient cars.
    • Depending on which part of the country you live, local gas prices can be higher or lower than the national average. One reason is that states and municipalities charge different tax rates. Another factor is the gasoline itself. For instance, drivers in California are required to use a higher quality fuel in order to limit pollution. Lastly, transporting crude oil to refineries adds transportation costs. A gas price heat map is found above or at:


Week of November 17th through 21st
The Economics of Thanksgiving


  • What is it? A pricing index from the American Farm Bureau Federation (AFBF) comparing Thanksgiving-related costs for 2014 compared to prior years.
  • What does it mean? AFBF estimates that the average cost of a Thanksgiving “feast” for 10 people will be $49.41, up 37 cents from 2013. This figure includes traditional “fixings” and does include alcohol or other “luxuries.” Also, AAA estimates that over 46 million Americans will be driving more than 50 miles from home over the holiday, an increase of 4.2 percent over 2013.
  • What's driving this? While the price of turkey is actually down, other food items such as sweet potatoes, dairy products and pumpkin pie mix are up. In addition to AFBF’s national estimates, NerdWallet did a study of the cost of a Thanksgiving feast by metro area. Like anything else, what consumers pay depends somewhat on where they live and the local cost of living. Below is a chart that compares Omaha to metro areas in neighboring states. Regarding travel, more Americans are choosing to travel by car due to the decrease in gasoline costs and the increase in Amtrack and airline tickets.


Week of November 3rd through 7th
North American Office Market Rankings


  • What is it? A comparison of North American office markets as published by Colliers International.
  • What does it mean? Omaha made the list of lowest North American Central Business District (CBD) vacancy rates for the third quarter. Omaha has the fifth lowest CBD vacancy rate at 6.93%, behind Toronto, Raleigh, Vancouver and Montreal.
  • What's driving this? While there has been over 200,000 square feet of true office-using absorption since 2010, the overall renaissance of downtown Omaha has more to do with the low vacancy rate than does absorption. Several older, obsolete properties have been removed from the office inventory and are, or have been, renovated for other uses. Since 2010, 784 apartments units and 152 hotel rooms have been added to the downtown market from such re-purposed properties. For instance, the 236,206-square-foot former Enron building at 2223 Dodge Street sat vacant for several years. Once this property was purchased for another purpose, over 200,000 square feet was removed from the office market vacancy.


Week of October 27th through 31st
One World Trade Center


  • What is it? A newly constructed 104-story (71 stories of rentable space) Class A office building, where the former Twin Towers stood, in Manhattan. It is the tallest and most expensive building in the Western Hemisphere. It’s first tenants move in today.
  • What does it mean? 1.72 million square feet of its 3 million rentable square feet are spoken for, leaving 1.28 million square feet (42.5% vacancy rate) available for rent.  Conde Nast, publisher of several magazine brands, moves in today and will occupy 25 floors (1.2 million square feet), floors 20 through 44. Asking rents started at $75 per square foot, but have been cut by 10% to $69 per square foot for middle floors. In comparison, the asking rent for Class A office space in downtown Omaha is $20.25 per square foot.
  • What's driving this? New Yorkers have vowed to rebuild this area since the 2001 World Trade Center attacks. Part of the Lower Manhattan revival include the memorial fountains where the former Twin Towers once stood and a 9/11 museum that opened in May. While this area traditionally was home to financial institutions, the move of Conde Nast from Times Square is indicative of a more diverse group of tenants. Since the attacks, the population of the neighborhood has tripled, bringing more restaurants and amenities to the area. Of course security is a huge concern for the property.  Several entities including the FBI and the Port Authority contributed to this building becoming  “the most secure office building in America.”  Interested in renting? Here’s the brochure:


Week of October 27th through 31st
The Economics of Halloween


  • What is it? A consumer spending survey of 6,332 Americans conducted by the National Retail Federation (NRF) that measures consumer behavior and shopping trends related to Halloween.
  • What does it mean? According to the survey, 67.4% of those that celebrate Halloween will purchase a costume, the highest percentage since the survey’s 11-year existence. They also report that Americans will spend a total of $7.4 billion on Halloween or an average of $77.52 per capita, up from $75.03 in 2013.
  • What's driving this? Halloween is one of the fastest growing consumer holidays. It is second in spending to Christmas. While Halloween has traditionally been focused on children, more and more adults are purchasing and wearing costumes and more people are purchasing costumes for their pets. A total of $2.79 billion will be spent on costumes. The majority ($1.38 billion) will be spent on adult costumes, with children’s costumes in second place at $1.06 billion and pet costumes in third place at $0.35 billion. $2.23 billion will be spent on costumes, $2.02 billion on candy and $0.35 billion on greeting cards.


Week of October 20th through 24th
Commercial Real Estate Sales Volume


  • What is it? The annual dollar amount of commercial real estate sales in Douglas County, including commercial, industrial and multi-family properties.
  • What does it mean? During the past ten years, pre-recessionary 2006 experienced the highest amount of commercial real estate sales with over $500M in sales. Not surprisingly, 2009 had the least  amount of sales with under $140M in sales. We are moving in the right direction again, with sales of almost $450M in 2013, representing 86% of 2006 levels. 2014 already has $309M in commercial real estate sales through September 17th. I predict 2014 will surpass 2013 in sales volume.
  • What's driving this? According to the 2014 Sage Business Index, American businesses predict a 3.1 percent rise in revenue in the next twelve months. Sage’s report also indicates that U.S. small business confidence reached 67.53 (1-100 scale) up 2.88 points from last year. If businesses expand they will need more space. As businesses need more space, they may consider purchasing, as will investors wantint to capitalize on the increase of leased space.


Week of October 13th through 17th
Monthly Consumer Survey


  • What is it? The National Retail Federation Foundation conducts monthly consumer surveys. The October survey asks consumers about holiday spending. The survey reveals trends in the timing and places of holiday spending.
  • What does it mean? The majority, 40.9 percent, of respondents indicated they will begin their holiday shopping in November, 21.4 percent in October, 15.5 percent the first two weeks of December, 12.1 percent before September, 6.9 percent in September and the remaining 3.2 percent the last two weeks of December. Most consumers (61.9%) still plan to shop at discount stores, but that number is down from this time last year’s figure of 64.7 percent. In second place are department stores, with 59.7 percent of consumers planning to shop there. This figure is up from this time last year’s figure of 56.31 percent.  Other shopping venues with year-over-year increases are clothing or accessory stores, electronic stores, and other specialty stores.
  • What's driving this? Regarding timing, it’s not a surprise that many consumers begin their shopping in November, when “Black Friday” and “Cyber Monday” deals come out.  Regarding shopping venues, folks are ready to venture out from the discount stores due to several years of “tightening their belt.” They are looking forward to branching out to other, more specialized or high-end shopping venues. The preliminary October consumer confidence index came in at 86.4, up from 84.6 in September and much higher than the predicted 84.0. The U.S hasn’t seen consumer confidence this high scine July, 2007. Also, with the increase in the shop-local trend a new category, local/small business, has been added to the survey with 26.8 percent of respondents indicating they would be shopping in these stores.


Week of October 6th through 10th
Third Quarter Quick Look


  • What is it? Vacancy and absorption for the Omaha office, industrial and retail markets as reported by Xceligent. Colliers' official Omaha Metro Area Research & Forecast reports will come out later this October, but a quick look at the third quarter is found above. (Click here to download quick look PDF.)
  • What does it mean? All three Omaha markets show healthy vacancy rates with office, industrial and retail standing at 12.3%, 2.9% and 7.5% vacancies respectively.
  • What's driving this? The big hit in the office market was the move out of Lockheed Martin from the area, vacating over 85,000 square feet. Absorption for the Omaha industrial market was 102,630 square feet for the quarter, bringing the vacancy rate to a historic low of 2.9%. The retail market in Omaha bounced back with 284,063 square feet of absorption thanks to the completion of a Sam’s Club, a Walmart Neighborhood Market and two multi-tenant properties.

Week of September 29th through October 3rd
The Hardest Places to Live in the U.S.

  • What is it? An article by the New York Times ranking U.S. counties on education, median household income, unemployment rate, disability rate, life expectancy and obesity.
  • What does it mean? The article sites Clay County, KY as the hardest place to live in the U.S.  In fact, 6 of the 10 hardest places to live were counties in the Appalachian Mountains area. The other 4 are also located in the rural South. All Omaha MSA counties except Pottawattamie ranked in the top third of easiest places to live. The metro area counties seem to buck the trend of more rural areas faring worse than urban areas. The most urban county for each state, Douglas in Nebraska and Pottawattamie in Iowa, ranked worse than their surrounding counties in their respective state.
  • What's driving this? Sarpy County ranks highest in the metro overall, but also boasts the highest median household income and life expectancy, and is tied with Washington County for the lowest disability rate. On the flip side, Pottawattamie ranks lowest in the metro overall, and also has the lowest median household income and highest disability rate. It is tied for the highest unemployment rate (although still relatively low nationally) and tied for the highest obesity rate at 38%.


Week of September 22nd through 26th
Income Inequality By State

  • What is it? An article by Business Insider comparing U.S. states by how much a household needs to make to be in the top 1% of earners.
  • What does it mean? The highest figure is in Washington, D.C., where a household would have to make $688,000 to be among the top 1% of earners. The lowest figure is found in Idaho, with an income of $274,000 putting a household in the 1%. Nebraska is somewhere in the middle with a household income of $329,000 required to be considered part of the 1%.
  • What's driving this? Another article by Business Insider sites that out of OECD (the Organization for Economic Cooperation and Development) countries, the U.S. has the largest share of low wage paying jobs. So, income inequality is a something that is happening on a national level. By state, the household income figure required to be considered in the 1%, pretty much corresponds with incomes and cost-of-living trends.  The numbers are higher in the northeast (D.C., Connecticut, New York) and lower in the south (Alabama, Arkansas, Mississippi) and parts of the northwest (Idaho, Montana, Wyoming). Here’s how Nebraska compares to its neighbors:

Links to Business Insider articles can be found here: Income Equality In The U.S. and America Is No. 1 In Low-Paying Jobs

Sources: Business Insider, Minnesota Population Center, OECD Employment Outlook 2013, Morgan Stanley Research


Week of September 15th through 19th
Apartment Construction Levels

Office Construction Levels 

  • What is it? An article in the Wall Street Journal addressing apartment construction rates in the U.S., plus multi-family permit data comparing Omaha to the U.S.
  • What does it mean? The article states that apartment construction in the U.S. has hit its highest level since 1989. When comparing multi-family permit data for Omaha and the U.S. since 2004, the trend is much the same; such permits were at their lowest during 2009 at the height of the recession and have bounced back. While U.S. permits are still lower than 2004 levels, the Omaha metro’s permits are actually higher than before the recession.
  • What's driving this? 94% of multi-family units are being built for rent. Compared with the pre-recession housing bubble, many more of the units being built were for sale as condos. The move toward renting vs. owning is especially prevelent in the millennial age group (22-32). These young people may have student loans to pay off, are facing a tough job market, are waiting longer to get married and have children and are more prone to “job hopping”. They also may have witnessed the older generations deal with foreclosures or “under water” mortgages, and are not interested in taking that risk.


Week of September 8th through 12th
U.S. State Economies  


  • What is it? Business Insider analyzed the economies of each U.S. state and ranked them based on seven variables:  July 2014 unemployment rate, July 2014 change from July 2014 in non-farm payrolls, 2013 state gross domestic product per capita, 2012 personal consumption expenditures per capita, 2013 average annual wage, 2013 exports per capita, and 2012 state government surplus/deficit per capita.
  • What does it mean?  North Dakota’s economy came in first place, while Mississippi came in 50th place.  Nebraska’s economy ranked as the 20th strongest economy among all 50 states.
  • What's driving this? North Dakota’s oil boom has contributed to the states unemployment rate of 2.8% (lowest in the country) and is second place in GDP per capita. Mississippi had the highest unemployment rate and the lowest average annual wages in the country. Nebraska has the second lowest unemployment rate in the country at 3.6%, however average annual wages are lower than many states at $39,968. Here’s how Nebraska compares to its neighbors:

    U.S. State Economy Rankings


Week of September 1st through 8th
Office-Using Post-Recessionary Recovery  

Office-Using Post-Recessionary Recovery 

  • What is it? The recovery of office-using employment figures since the height of the recession. Office-using employment is defined as professional and business services, financial activities, and information services sectors. Recovery from the recession is based on each market’s respective cyclical high and low employment levels.
  • What does it mean? This data was collected for each U.S. MSA where Colliers International offices. Out of 84 MSAs, Omaha ranks thirteenth for the percentage of office-using jobs recovered with 188.5% of such jobs recovered.
  • What's driving this? Not only are office-using jobs recovering in Omaha, but the overall unemployment rate remains well below the national average at 4.2%.


Week of August 25th through 29th
North American 2nd Quarter Office and Industrial Vacancy Rates  

2nd Quarter Office & Industrial Vacancy Rates 

  • What is it? The quarterly statistics for the North American office and industrial markets compared to individual markets as reported by Colliers International.
  • What does it mean? The Omaha industrial market has the fifth lowest vacancy rate in North America. The metro area didn’t make it in the top five lowest vacancy rates for the office market, but still shows favorably with the fourteenth lowest vacancy rate overall, the sixth lowest for CBD and the fifteenth lowest for the suburban market.
  • What's driving this? Even with a tight industrial market and little available inventory, deals are still getting done in Omaha, particularly in the Southwest and West Sarpy County areas of town. Desirable existing spaces are snatched up quickly, while some companies are choosing to build new product. The new, fully occupied, headquarters for Gordmans and Tenaska contributed to the positive absorption and decrease in vacancy for the office market.


Week of August 18th through 22nd
True Purchasing Power of U.S. States and Metro Areas  

-	Relative Value of $100 

-	NE Compared to Neighboring States 

  • What is it? A map of what $100 is actually worth in your state as published by Business Insider and related lists by state and metro area as published by the Tax Foundation.
  • What does it mean? Nebraska ranks 12th out of 50 states, with $110.99 relative value of $100. The Omaha metro area value is $106.04. Basically, a dollar goes farther here than in other areas of the country.
  • What's driving this? In a lot of cases, more densely populated areas have a lower relative value. As more people populate the same amount of space, housing prices increase due to supply and demand. As you can see from the chart above, sometimes tax policy can cause a buck in this trend. For metro areas in the 6-state area surrounding Nebraska, St. Louis, MO has the highest relative value at $112.49. St. Louis has the highest population of metros on this list at 2.8 million. The low tax rate per capita of the state of Missouri surely contributes to this.


Week of August 11th through 15th
Conservatism in America  

-	Conservatism in America 

  • What is it? A chart by The Economist indicating the conservatism of American cities with 250,000 people or greater.
  • What does it mean? Omaha made the chart and leans to the right of political equilibrium.
  • What's driving this? I don’t think there’s any surprise here. Omaha is a medium sized city in the heart of the Midwest. The chart verifies the stereotype of larger cities on either coast as more liberal leaning (San Francisco & New York). The most conservative leaning cities are in the South (Mesa, AZ & Oklahoma City, OK). However, the chart also shows that large cities in the South or Midwest can lean liberal (Chicago & Atlanta). What I find truly interesting is the differentiation in political leaning within the same metro area. In the DFW metro, Arlington leans conservative, Fort Worth is right at equilibrium and Dallas leans liberal.


Week of August 4th through 8th
The Fate of America's Dying Supercenters  

-	Vacated and/or Re-purposed Big-Box Space in Omaha  

  • What is it? An article by Business Insider about the fate of big-box stores.
  • What does it mean? Big-box spaces, when vacated, can remain empty for a while. We’ve seen a little of this in the Omaha market, but for the most part, spaces are refilled or re-purposed. Most of the big vacant spaces that have struggled in the area are Mall of the Bluffs, the South 84th Street Corridor in La Vista and Crossroads Mall. JCPenney and Target both moved out of Mall of the Bluffs to new centers, but the Mall was purchased in 2013 and the new owners say they intend to fill the mall and keep it as a retail center. The South 84th Street Corridor suffered a similar fate with retailers moving to new developments. The City of La Vista has plans to redevelop the corridor and taxpayers backed up this plan with the approval of a half-cent sales tax to help fund the plan. The new owner of Crossroads Mall also has plans to redevelop this center that sits on a highly desirable and busy intersection in Omaha. Additionally, I think it’s important to point out that some vacancies were due to national closures, such as Borders and Best Buy.
  • What's driving this? The article talks about the fate of big-box retailers in light of factors that impact the visitors to their stores. One factor is a shortened driving distance by consumers due to the popularity of smaller, urban communities as opposed to suburban living. Other factors include the preference of 20 and 30-somethings to shop in smaller, local shops and the popularity of e-commerce. In response to these trends, some retailers, such as Walmart, are building smaller stores (Neighborhood Market vs. Supercenter). Some are re-purposing the space to another form of retail (divide the space), distribution, or sell to communities to be used as public spaces. Examples of vacated and/or re-purposed big-box spaces in Omaha can be found in the chart above. View the entire Business Insider article here: The Fate of America's Dying Supercenters.


Week of July 28th through August 4th
50 Great Affordable College Towns in the U.S.  

-	50 Great Affordable College Towns in the U.S. 

  • What is it? A list of the top 50 college towns with the lowest cost of living index scores as reported by Great Value Colleges.
  • What does it mean? Omaha was named #6 on the list of most affordable college towns, with a cost-of-living index score of 88.3, which is well below the average of 100. In neighboring states, only Cedar Falls, IA; Columbia, MO; Lawrence, KS and Manhattan, KS made the top 50.  No college towns in Colorado, Wyoming or South Dakota made the list.
  • What's driving this? The cost-of-living index is published by the Council for Community and Economic Research and rates cities on several factors: the cost of groceries, housing, utilities, transportation and health care. Omaha scores lower (better) than the average in all categories except health care, which is only slightly higher than the national average at 101.6. Omaha’s lowest expense index is housing at 78.0. This is great news for prospective students (and their parents) considering whether or not to study close to home.


Week of July 21st through 25th
Pollina Corporate Top 10 Pro-Business States  

NE Earns Spot on Pollina List 

  • What is it? A study based on 32 factors that are important to the business community when making site selection decisions, as reported by Brent Pollina of Pollina Corporate Real Estate, Inc.
  • What does it mean? Nebraska was named as the 3rd best pro-business state on the 2014 list, up from 18th best in 2004, the year the list was first published.
  • What's driving this? Nebraska scored an “A” grade overall and in the following categories: Unemployment Rate, Right-to-Work, Unemployment Insurance, Business Inventory Tax, Regulatory Environment, Litigation Environment, Transportation Infrastructure, Long-Term Budget Planning, and Marketing/Website/Response to new & existing employers. The state did not score an “F” in any category and scored a “D” in only two categories: Corporate Tax Index and Property Tax. If you look at the chart above, you will see that business incentive legislation has an impact on the pro-business environment here in Nebraska. LB 312 (The Nebraska Advantage) was passed in 2005 with incentives to entice businesses to the state. LB 895 (NE Super Advantage) was added in 2008 with incentives to companies with higher wage jobs. LB 1118 was added in 2012 with incentives for Data Centers.


Week of July 14th through 18th
Housing Starts  

Housing Starts 

  • What is it? Privately owned housing starts of 1-unit structures (no apartments, duplexes, etc.) as reported by the U.S. Commerce Department.
  • What does it mean? The U.S., state of Nebraska and Omaha MSA all saw a drop in housing starts between the months of April and May. While figures for June for states and MSAs have not yet been published, the Wall Street Journal reported that U.S. housing starts for the month of June also declined.
  • What's driving this? The June decline nationally was due to the Southern part of the country experiencing a colder and wetter winter and spring than usual. The article references a two to three month increase to the amount of time needed to develop a home lot. Other reasons sited include a lack of skilled labor to keep up with demand, slower permitting by municipalities, rising mortgage rates and higher prices The Nebraska and Omaha trend lines (below) more or less mirror the U.S. line. The National Association of Home Builders (NAHB) forecasts that housing starts will be above 1 million by the end of 2016 (the dark blue line). Will Nebraska and Omaha’s levels increase at the same rate? I would expect a flatter line, but still a healthy increase over the next couple of years.


Week of July 7th through 11th
10 Best Cities to Launch a Start-Up  


  • What is it? A list published by CNN Money, based on a NerdWallet study that ranks U.S. cities on nine different pro-business criteria.
  • What does it mean? Omaha rose seven spots from tenth place to third place overall on the list from this time last year.
  • What's driving this? It’s no surprise that Omaha ranks first place with regard to the unemployment rate of 4.5 percent. Omaha performed well with it’s low Cost of Living Index of 87.23 (second place to Memphis) and it’s healthy population growth of 12.61 percent between 2007 and 2012 (third place to Raleigh and Miami). Omaha ranked fourth in Commercial and Industrial Loans (C & I) per capita. The areas where Omaha fell in the bottom half of the list include: Percentage of 25+ Population with Bachelor’s or higher (seventh place), Per Capita Income (seventh place), Businesses per 100 residents (ninth place) and the Small Business Grade Score (sixth place). The Small Business Grade Score is from Thumbtack’s survey of small business owners with scores from 12 (high) to 0 (low). The biggest change for Omaha from 2013 was the C & I per capita number. It rose 274 percent from $125 in 2013 to $342.56 in 2014, which shows that lending institutions are more willing to lend to the business community locally.


Week of June 30th through July 4th
Second Quarter Sneak Peek

  • What is it? Vacancy and absorption for the office, industrial and retail markets as reported by Xceligent. The official Colliers Research and Forecast Reports will be released later this month, but a snapshot of the second quarter is found above. (Click here to download snapshot PDF.)
  • What does it mean? All three markets show healthy vacancy rates with office, industrial and retail standing at 11.7 percent, 3.3 percent and 7.6 percent vacancies respectively.
  • What's driving this? Leasing remains strong in the Suburban West Dodge office submarket, boasting 102,574 square feet of the total 184,525 square feet for the quarter. Absorption for the industrial market was 762,118 square feet for the quarter, made up primarily of one large deal in the Southwest submarket. The retail market was pretty flat with only 14,294 square feet of absorption. Only one small strip center at Midlands Placed was delivered for the quarter.


Week of June 23rd through 27th
GDP Announcement & Brookings Institute Data


  • What is it? Actual (vs. forecasted) U.S. GDP figures for the first quarter of 2014 reported by the U.S. Commerce department and Brookings Institute Metro Monitor for June, 2014 comparing the economies of the largest 100 U.S. MSAs.
  • What does it mean? GDP was estimated to have shrunk by 1 percent in the first quarter. Actual numbers have been computed and reveal that the economy shrunk by 2.9 percent. The Brookings Institute published their first quarter figures also, comparing U.S. metro areas. The Omaha metro ranked 1st for overall economic performance during the recession, 76th during the recovery and 12th during both the recession and recovery.
  • What's driving this? Two thirds of the overall drop in GDP is due to a drop in health care spending. Other contributing factors include a larger than anticipated trade deficit, and the results of a severe winter: closed factories, disrupted shipping, and low retail sales. Although this number could be viewed as alarming, economists predict strong growth in GDP of 4 percent for the second quarter. With the “R word” (recession) defined as two successive quarters of a decline in GDP, I believe we are safe from such a fate at this time. It’s been widely known by Omahans that we fared much better during the “R word” than did other metro areas. The Brookings Institute shows this in pictures on their website.


Week of June 16th through 20th
The Impact of the College World Series (CWS) on the Omaha Economy


  • What is it? An analysis utilizing several sources to determine the economic impact and success of the College World Series for the Omaha metro.
  • What does it mean? In 2007, Ernie Goss of Creighton University conducted a study siting several different facts and figures: 1) The economic impact on the local economy for 2007 was $40,977,260 and predicted to be $514,792,821 between 2008 and 2018, 2) 48.5 percent of attendees come to Omaha from outside Nebraska with 7.4 percent coming from Nebraska outside Omaha, and 3) 64 percent of non-Nebraska CWS visitors planned to attend another Omaha attraction while in town.
  • What's driving this? The tournament has been a successful event held in Omaha since 1950. Originally held at Rosenblatt Stadium, local officials made the controversial decision to build a new stadium downtown, securing the tournament until 2035. TD Ameritrade Park opened April of 2011. It is my opinion that this decision not only secured Omaha’s hosting of the event for another 25 years, but contributes to it’s future success for decades to come. Although locals were upset about the decision, the numbers show there are many non-local attendees that we must serve with area amenities and infrastructure. The new location has many more hotel rooms, restaurants and parking within a 1-mile radius and is much closer to the airport. Although first-year attendance (321,684 vs. 330,922 prior year) at TD Ameritrade Park took a slight dip, 2013 had record attendance with 341,483 attendees. While there will always be nostalgia for Rosenblatt, you can’t argue with success.


Week of June 9th through 13th
2014 Leading Locations Rankings


  • What is it? An analysis and ranking of metro areas by several economic indicators as published by Area Development, a publication covering corporate site selection and relocation trends.
  • What does it mean? This is but one more index to measure the performance of our local economy. Out of 379 metro areas, the Omaha metro ranks 130.
  • What's driving this? Areas where Omaha fares better than the overall rank are: prime work force inward migration for those with a bachelor’s degree or higher as a percent of total work force (rank 65), the local unemployment rate (rank 23), and per capita real GMP (gross metropolitan product, rank 83). Areas where Omaha performs worse than the overall rank are: wage and salary growth (rank 234), manufacturing/goods producing employment growth as percent of total population (rank 245), and employment growth as percent of total population. In a nutshell, Omaha is attracting college-educated individuals from outside the area to come here and work. With unemployment low, the wage and salary growth figure should increase. The manufacturing figure is no surprise, considering that Omaha’s primary industries consist of insurance, direct marketing, data, transportation and health services. How does Omaha compare to similar sized metros? (See the chart above.)


Week of June 2nd through 6th
North America 1st Quarter Office Market Report


  • What is it? The quarterly statistics for the North American office market compared to individual markets as reported by Colliers International.
  • What does it mean? The Omaha office market made it on two of the top performer charts on this report, office-using employment recovery and quarterly absorption in the Midwest. The report touts Omaha as having recovered 185.2 percent* of office-using jobs from the height of the recession and having absorbed 220,000** square feet for the first quarter of 2014.
  • What's driving this? The report talks about the fact that office-using employment has recovered at a much faster pace than office space absorption. The reasons sited for this have to do with tenants using space more efficiently: “technological changes supporting greater worker mobility and a reduced need for office space, the trend of collaborative workplace environments and a focus on cutting costs.” The local absorption can largely be attributed to the purchase of a 99,336-square-foot building at 7261 Mercy Road by Alegent Creighton and the completion of SAC Credit Union’s 90,000-square-foot building in Papillion.


Week of May 19th through 23rd
The Economics of Memorial Day

U.S. Consumer Price Index 

  • What is it? Consumer Price Index (CPI) for all items compared to the CPI for food & beverage and gasoline.
  • What does it mean? For most Americans, Memorial Day means a 3-day weekend. For some, it means traveling to visit family and/or friends and the kick-off to the summer barbeque. Every year we hear on the news about gas prices increasing around holiday weekends. This year is no different. Additionally, this year comes with an increase in beef and pork prices.
  • What's driving this? As the chart above shows, the CPI for gas has been higher and more volatile than the CPI for all items for most of the past decade. This comes as no surprise given that the price for crude oil is largely determined by supply and demand globally, not just here in the U.S. Although the CPI for gasoline is higher than this time last year, it is lower than this time in 2012 and 2011. Food prices are up, particularly meat prices, a cook-out favorite. According to the USDA, extreme weather and disease outbreak are to blame for the increase. The U.S. has the lowest cattle numbers since 1951 with inventories continuing to decline. Even though the CPI for food and beverage is higher than the CPI for all items, it is only slightly higher at 240.95 compared to 236.25 overall.


Week of May 12th through 16th
Housing Starts

 Montly Housing Starts

  • What is it? The actual start of construction of new housing as reported by the U.S. Commerce Department
  • What does it mean? Figures for the month of April were released Friday for the U.S., indicating an increase month-over-month of 13.2 percent. Figures for the Omaha metro are not yet available, but March 1-unit residential figures show an increase of 13.7 percent in the metro compared to an increase of 9.3 percent for the U.S. As the chart below shows, the trend for the Omaha metro closely follows the trend in the U.S. In more recent months, the growth rate in Omaha has outpaced the U.S.
  • What's driving this? The U.S. April figure indicates that multi-family properties comprised the majority of the increase with a small increase in 1-unit residential properties. Of the increase in single-family dwellings, much is due to higher-end product as opposed to lower-priced “starter” homes. If you compare median asking home prices in Omaha compared to the U.S., Omaha is favorable. According to Trulia, the median asking price in Omaha is $158,000 compared to $277,662 for the U.S. as a whole.


Week of May 5th through 9th
The Mid-America Business Conditions Index


  • What is it? The Mid-America Business Conditions Index is published by Ernie Goss at Creighton University and measures the economy of a nine-state region including Nebraska. Numbers over 50 represent an expanding economy for the next three to six months.
  • What does it mean? The index increased to its highest level in three years; 60.4 in April from 58.2 in March. The index has experienced a level at or above 50 for sixteen straight months.
  • What's driving this? The index is comprised of several factors: employment, wholesale prices, business confidence, inventories, trade, new orders, production and delivery time. The wholesale prices index rose to 75.9, indicating inflation. Confidence rose to 64.2. Specifically, Goss sites that 65.5 percent of supply managers believe that the Affordable Care Act has resulted in little or no impact on their businesses. Both the export and import indexes rose for the month, as did the indexes for new orders and production.


Week of April 28th through May 2nd
U.S. Employment - ADP National Employment Report


  • What is it? Employment numbers as reported by ADP, a human resource provider company (as opposed to BLS employment figures).
  • What does it mean? Numbers released April 30th indicate an increase of 220,000 jobs for the month of April, bringing total private sector employment is 116,320,000. To put this in perspective, at the height of economic strength (January, 2008) there were 115,972,000 private sector jobs. At the lowest point of the recession (February, 2010) there were 107,240,000 total private sector jobs. Not only has the job market recovered from the recession (up 8.5%), there are 348,000 (3.0%) more jobs than the pre-recessionary “heyday.”
  • What's driving this? Overall, consumer and business confidence is back. While overall employment is up, there is an interesting trend. We’ve often heard lately that “America doesn’t make anything anymore”. The graph above illustrates that even prior to the recession Goods Producing jobs have steadily decreased while Service Providing jobs have increased. It looks like that saying is true, but is it necessarily a bad thing? It may just mean that our economy is shifting from manufacturing to other sectors due to technological advancement.


Week of April 11th through 18th
Unemployment Rate by Metropolitan Statistical Area (MSA)


Much has been said about the stability of the Omaha economy and, specifically, the low unemployment rate.  Bloomberg published an article that discusses the struggle to fill positions in MSA’s where the unemployment rate falls below the full employment rate, defined by the Federal Reserve as 5.2 percent to 5.6 percent. The unemployment rate in Omaha for the month of February was 4.5 percent, well below that full employment rate. The article sites several methods of attracting candidates: raising wages, adding benefits, recruiting from other regions, exposing college students to local businesses through internships and utilizing social media for recruiting. The article mentions that the tight labor markets have resulted in a year-to-date 2 percent rise in compensation with a prediction of a 2.2 percent rise next year, 2.5 percent in two years and 3 percent by late 2016. 

Along with the article, Bloomberg also provides a visual representation of the unemployment rates of MSAs in February, 2014 compared to the rates in October, 2009. Those MSAs shaded on the maps in white represent unemployment rates less than 5 percent, blue represents 5-7.5 percent, orange represents 7.6-10 percent and red represents greater than 10 percent.  An interesting fact revealed is that Omaha is one of only ten MSAs with an unemployment rate lower than 5 percent both in October, 2009 and February, 2014. 

Link to the article: Tight Job Market in US Cities Prompts Higher Pay


Week of April 4th through 11th
Quarterly Vacancy Rate

 Omaha Vacancy Rate

  • What is it? The overall vacancy rate for the office, industrial and retail markets as reported by Xceligent.  The industrial and retail markets include owner-occupied properties. The office market does not, meaning that office vacancy rates will always be higher than the other two categories in comparison.
  • What does it mean? All three markets are showing extremely low vacancy rates with office, industrial and retail standing at 9.7 percent, 4.4 percent and 7.7 percent vacancies respectively. At the end of 2010, the year Xceligent started tracking the Omaha market and the height of the great recession, vacancy rates for office, industrial and retail were 14.8 percent, 6.8 percent and 11.7 percent, respectively.
  • What's driving this? Regarding the office market, leasing activity is increasing due to business leaders’ increased confidence in the economy. However, several properties were removed from the tracked inventory due to re-purposing (converted to apartments, etc), which also helped to reduce the vacancy rate. The industrial vacancy rate is extremely low, finally forcing an up-tick in asking rents. Even so, speculative building has been basically non-existent, with any new construction consisting of build-to-suit properties. The low vacancy rate in the retail market can be attributed to new construction coming to a screeching halt once the recession hit. Existing space has been absorbed and planned projects are starting to emerge once again.


Week of March 31st through April 4th
The Mid-America Business Conditions Index

 Business Conditions Index, Mid-America

  • What is it? The Mid-America Business Conditions Index is published by Ernie Goss at Creighton University and measures the economy of a nine-state region including Nebraska. The index takes in to account new orders, production, delivery lead time, employment, inventories, prices and business confidence. The index is a number between 0 and 100 with numbers over 50 representing an expanding economy for the next three to six months.
  • What does it mean? The index increased to 58.2 in March from 57.4 in February for the nine-state region. The index has been at or above 50 form fifteen straight months.  While the index is still not at pre-recessionary levels (April, 2006=66), the index is moving in the right direction and hasn’t fallen below 50 since December, 2012.
  • What's driving this? The index findings are mixed. Actual employment has increased and surveys indicate that hiring will continue to increase. The inventory index shows that managers increased inventories in anticipation of expanding sales. Exports are up as are new orders. However, business confidence declined from 59.7 in February to 59.0 in March, due to concerns over trade embargoes with Russia. Wholesale-level inflation is up with supply managers expecting prices to increase 2.4% in the next six months and 4.8% for the year. Even this figure is a mixed bag. These same supply managers forcasted an annual increase of 6.8% this same time last year.


Week of March 24th through 28th
Home Prices

 Omaha Commercial Real Estate Analysis

  • What is it? Home price movement as reported by two sources: The S&P/Case-Shiller 20-City Composite and the Census Bureau.
  • What does it mean? The Census Bureau reported a decrease in median new home price year-over-year in February of 1.2%.  The Case-Shiller composite reported a monthly decrease of 0.08% for the month of January.
  • What's driving this? I believe this to be a normal market correction. As the graph above shows, both indicators have shown upward movement since the bottom hit sometime in 2009. House prices shouldn’t grow too high too fast or the U.S. economy will find itself in the same housing-bubble situation it was in before the recession. Slow, steady growth is what the housing market and the economy in general needs. Hopefully lessons were learned from history and slow and steady is exactly what will happen.

Week of March 10th through 14th
Planned Omaha Office Market Construction

Actual and Future Annual Absorption

  • What is it? The total square footage of planned office building projects as reported by the Omaha World-Herald. Preview the complete article here.
  • What does it mean? This article references over 30,000,000 square feet of planned or proposed Omaha office building projects. Referencing the graph above, at first glance it appears that this amount of square footage would take 17 years (the year 2030) to absorb if compared to the 18-year average of 178,792 square feet per year. This graph does not tell the entire story.  The Omaha commercial real estate community has collectively decided not to include owner-occupied or medical properties in its quarterly office market statistics. Certainly, some of the planned projects cited in the article could be owner-occupied or medical projects. Due to this methodology, I believe these absorption numbers to be greatly understated. For instance, the graph does not include such projects as the new TD Ameritrade building in 2013 or Union Pacific’s building in 2002 due to their owner-occupied status. Also, I believe 2001’s negative absorption to be an anomaly, with the business climate extremely influenced by the uncertainty after the 9/11 tragedy. It is my opinion that the planned office projects will take between 7 and 10 years to absorb.
  • What's driving this? The article cites an upswing in the economy, spurring developers to “play catch-up” after the recessionary lull in construction.


Week of March 17th through 21st
Economic Impact of the NCAA Basketball Tournament

Economic Impact of the NCAA Basketball Tournament 

  • What is it? A collection of stats and opinions from various sources regarding the economic impact (good and bad) of the March Madness NCAA Basketball Tournament.
  • What does it mean? It depends on your view. As a business owner, you might be concerned that the firm of Challenger, Gray & Christmas has placed a figure of $134,000,000 on lost productivity during the first two days of the tournament.  If you work for a civic economic development organization, an advertising firm or television network you might be overjoyed at the numbers. Local host cities for the 2nd and 3rd rounds place a number anywhere between $5,000,000 and $10,000,000 as the economic boost for their city. An article on calls this number $8,000,000. They place an amount of $70,000,000 as the economic impact for the host city of the final four championship games. Approximately $1,400,000 is paid for a 30-second commercial during the championship game. CBS pays $771,000,000 per year to the NCAA for rights to the tournament. These figures far outweigh the lost productivity number and don’t include other non-measurable benefits. Local economies of non-hosting cities certainly benefit from a boost due to locals watching the games of their home team(s) at restaurants and bars or hosting parties at home. Although employers may experience lost productivity, much morale and employee sentiment can be gained if employers embrace the tournament and create a fun work environment around the games. Turn on the games in the conference room. Bring in some chicken wings. Employees will still get their work done and will enjoy their time at work a little more.

Week of March 10th through 14th
Planned Omaha Office Market Construction

Actual and Future Annual Absorption

  • What is it? The total square footage of planned office building projects as reported by the Omaha World-Herald. Preview the complete article here.
  • What does it mean? This article references over 30,000,000 square feet of planned or proposed Omaha office building projects. Referencing the graph above, at first glance it appears that this amount of square footage would take 17 years (the year 2030) to absorb if compared to the 18-year average of 178,792 square feet per year. This graph does not tell the entire story.  The Omaha commercial real estate community has collectively decided not to include owner-occupied or medical properties in its quarterly office market statistics. Certainly, some of the planned projects cited in the article could be owner-occupied or medical projects. Due to this methodology, I believe these absorption numbers to be greatly understated. For instance, the graph does not include such projects as the new TD Ameritrade building in 2013 or Union Pacific’s building in 2002 due to their owner-occupied status. Also, I believe 2001’s negative absorption to be an anomaly, with the business climate extremely influenced by the uncertainty after the 9/11 tragedy. It is my opinion that the planned office projects will take between 7 and 10 years to absorb.
  • What's driving this? The article cites an upswing in the economy, spurring developers to “play catch-up” after the recessionary lull in construction.

Week of March 3rd through 17th
Non-Residential Building Permits

  • What is it? The dollar amount value of non-residential permits for new construction and tenant improvements as reported by the eight counties that make up the Omaha MSA (Douglas, Sarpy, Pottawattamie, Washington, Cass, Saunders, Harrison, and Mills).
  • What does it mean? We’re back, baby! The final tally for 2013 was $669,217,915, which is officially higher than the total of $661,402,081 for the pre-recessionary year of 2008.
  • What's driving this? For the first time in a few years, the Omaha commercial real estate market started to see the completion of large commercial projects. Such projects for 2013 include the TD Ameritrade Headquarters building in Old Mill (447,276 sf), the Nebraska Crossing Outlet Mall (350,000 sf), the Gavilon Headquarters building downtown (131,225 sf), the Westroads IV Office Building (105,000 sf), the Millard Refrigeration Headquarters building at Sterling Ridge (65,696 sf), a Hobby Lobby in Papillion (55,000 sf), and five Walmart Neighborhood Markets, as well as other non-residential projects.

Week of February 17th through 21st
Housing Starts and Building Permits - 3 Month Moving Average


  • What is it? The U.S. Census Bureau reports housing starts, the beginning of new residential construction, and building permits that have been approved by the appropriate governing body. Because construction affects other areas of the economy such as financing and employment, both of these figures are economic indicators.
  • What does it mean? As with other economic indicators, housing starts and building permits are back at 2008 levels.
  • What's driving this?
People that may have considered buidling a new home “sat” on their money during the uncertain times of the economic downturn.  As consumer confidence numbers show, people are more willing to take chances and spend.

Week of February 10th through 14th
Wholesale Business Inventories-to-Sales Ratio

  • What is it? The U.S. Census Bureau reports sales, the combined value of trade sales and manufacturers’ shipments, as compared to inventories.
  • What does it mean? Inventories will always be higher than sales, otherwise store shelves would be empty. As you can see from the chart above, equilibrium is somewhere around 1.2. A ratio of 1.3 was reported for December, 2013. You can also see that sometime during 2008, the ratio was approaching 1.5, which means inventories were sitting on the shelf while consumers held on to their money at the height of the recession.
  • What's driving this? As other economic indicators also show, levels are back to prerecession levels.  Unemployment is down. Consumer confidence is up. Times are much less uncertain, so people are spending the money and getting that inventory off the shelves.

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