__MAIN_TEXT__

Page 1

prince george’s

Contents

Pulse QUARTERLY REPORT

Employment and Wages......................2

First Quarter 2016 • Vol. 2, Issue 1

Employment Private Sector Employment Total Wages Average Wage Per Worker Business Establishments

Changes in Employment • For all sectors from the first quarter of 2015 to the first quarter of 2016, the County gained 5,259 private sector jobs. Health Care and Social Assistance, Accommodation and Food Services, and Administrative and Waste Services saw the largest increases in employment between the first quarters of 2015 and 2016. More than 61 percent of the total increase in employment in the County occurred in these three sectors.

Real Estate............................................4 Housing Market Median Home Sales Price Housing Market Transactions Foreclosure Events Increase in Median Sale Prices Rents for Multifamily Units Multifamily Units Under Construction

• Two other sectors also recorded significant gains in employment during the period—Construction and Professional and Technical Services. Together, the two sectors added 1,449 jobs, representing 27 percent of the total increase in the County.

Commercial Market Volume of Industrial Space Vacancies Net Absorption (Space Leased) Rental Rates

• The Other Services, except the Public Administration sector, recorded the highest loss of employment in the County between the first quarter of 2015 and the first quarter of 2016. The 542 job losses accounted for 60 percent of the County’s total.

County Revenues.................................7 Sales and Use Taxes Changes in Revenues

• The Information sector also recorded a significant loss in employment during the period of 293 jobs representing 32 percent of the total losses in the County.

Prince George’s County Population Estimates

Source: The Nielsen Company, 2016.

4th Quarter 2016 Estimated Demographics Total Population 920,272 Total Households 323,898 Median Household $79,492 Income

Number of Employees

2015 Estimated Demographics Total Population 902,303 Total Households 316,453 Median Household $73,192 Income

Change in Employment 1st Quarter 2015 to 1st Quarter 2016 1,400 1,200 1,000 800 600 400 200 0 -200 -400 -600 -800

Source: Neustar, Inc., 2016.

M-NCPPC Prince George’s County Planning Department

1,203 784

25

838

665

493 200

38

183

153

1,184

230 15

154

-72 -293

-542


Employment and Wages EMPLOYMENT There was an increase (4,720 or 1.6 percent) in the quarterly average employment between the first quarter of 2015 and the first quarter of 2016. All of the increase (4,857) in employment occurred in the private sector, while 137 jobs were lost in the public sector. PRIVATE SECTOR EMPLOYMENT Most of the increase in private sector employment (3,595 or 74 percent) occurred in the service sector, with 1,262 more jobs in the private goods producing sector. TOTAL WAGES Overall, total wages in the County during the first quarter of 2016 were $4,033 million, which was 0.4 percent lower than the first quarter of 2015. The government sector experienced a decrease of $66.9 million, representing a 4.2 percent decrease in total wages. The private goods sector, saw a significant increase of $32.6 million (7 percent). Total wages in the private service sector increased by $17.2 million (0.8 percent). AVERAGE WAGE PER WORKER Overall, the average weekly wage per worker in the County decreased by one percent from the first quarter of 2015 to the first quarter of 2016. Both the government sector and private service sector saw declines. The government sector declined by 4.1 percent while the private service sector declined by one percent. The private goods sector, experienced an increase of 2.8 percent in average weekly wage per worker.

1st Quarter 2016 Average Employment 188,403

179,354

89,951

88,494

88,357

32,611

30,967

1st Quarter 2015

32,229

4th Quarter 2015

Government Sector

Private Sector Goods

1st Quarter 2016 Private Sector Service

Source: Maryland Department of Labor, Licensing and Regulation.

1st Quarter 2016 Total Wages (in millions) $2,025.7 $2,294.8 $2,008.5

Private Sector—Service

$496.6 $578.1 $464.0

Private Sector—Goods

$1,510.7 $1,578.5 $1,577.6

Government Sector 1st Quarter 2016

4th Quarter 2015

1st Quarter 2015

Source: Maryland Department of Labor, Licensing and Regulations.

1st Quarter 2016 Average Weekly Wage per Worker $1,371

$1,350 $1,364

$1,315 $1,185

$1,153 $861

1st Quarter 2015 Government Sector

$937

4th Quarter 2015 Private Sector Goods

Source: United States Department of Labor, Bureau of Labor Statistics.

2

182,949

$852

1st Quarter 2016 Private Sector Service


BUSINESS ESTABLISHMENTS Between the first quarter of 2015 and the first quarter of 2016, there were increases in business establishments in some sectors and decreases in others. The highest increases occurred in Construction with 85 establishments followed by Retail Trade (60), Professional and Technical Services (51), and Health Care and Social Assistance (47). Four other sectors recorded modest increases— Transportation and Warehousing (38), Administrative and Waste Services (20), Accommodation and Food Services (17), and Real Estate and Rental and Leasing (12). The highest losses of establishments occurred in Other Services (-6) and Wholesale Trade (-5). Top Ten Changes in Establishments 1st Quarter 2015 to 1st Quarter 2016 85

60 51

47 38 20

17

12 -6

-5

Source: United States Department of Labor, Bureau of Labor Statistics.

Percent Change

Percent Change in Labor Force, Employed, and Unemployed 1st Quarter 2015 to 1st Quarter 2016 4.00% 2.00% 0.00% -2.00% -4.00% -6.00% -8.00% -10.00% -12.00% -14.00%

Labor Force

Employed

County

Unemployed

Maryland

Source: United States Department of Labor, Bureau of Labor Statistics.

From first quarter 2015 to first quarter 2016, the County’s labor force grew by 6,191 (1.56 percent) to 494,163 persons. The number of employed residents in the County also grew faster than the state at 2.43 percent verses 1.72 percent, respectively. The number of employed persons grew by 11,175 from 459,319 in first quarter 2015 to 470,494 in first quarter 2016. Both the County and the state saw significant declines in the number of unemployed persons. The number of unemployed persons in the County declined by 3,563 persons from 27,232 to 23,669 during the period. 3


Real Estate Change in Median Sales Price by Unit Type $300,000 $250,000

Median Sales Price

HOUSING MARKET

Median Home Sales Price The median sales price for all homes sold during the first quarter of 2016 in Prince George’s County was $239,950, reflecting a 6.6 percent increase over the median sales price of $225,000 during the first quarter of 2015. Single-family and singlefamily attached units both saw 6 percent increases in price. Condominium units increased by 3.8 percent.

$200,000 $150,000

1st Quarter 2015 1st Quarter 2016

$100,000 $50,000 $0 Single-Family Single-Family Condominium Attached

All Units

Source: Metrostudy, www.metrostudy.com.

Housing Market Transactions #Percent of Units Sold in Median Sales Price Change

The total number of all units sold increased from 2,646 units in the first quarter of 2015 to 3,190 units in the first quarter of 2016. The increase was mostly due to a greater number of regular resale sales and REO sales. Regular resale sales jumped from 1,355 units for the first quarter of 2015 to 1,517 units in the first quarter of 2016 (12 percent). REO sales increased from 637 in the first quarter of 2015 to 955 for the first quarter of 2016 (50 percent). New units sold remained stable with 245 in the first quarter of 2015 to 246 in the first quarter of 2016. Although foreclosure sales increased over the period from 409 to 472 units their percentage of all transaction declined from 15.5 percent to 14.8 percent.

Percent Change Change in Median Sales Price from 1st Quarter 2015 to 1st Quarter 2016 Number of Units Sold by Type

7.0%

3500 6.0% 5.0% 3000 4.0%

2500 3.0%

2000 2.0%

1st Quarter 2015

1500 1.0%

1st Quarter 2016

1000 0.0% Single-Family

500

Single-Family Attached

Condominium

All Units

0 Single Family

Single Family Condominium Attached

Total

Source: Metrostudy, www.metrostudy.com.

Foreclosure Events The total foreclosure events held steady from the previous quarter. The number of events in the first quarter of 2016 was 2,741, 326 higher than the 3,415 recorded in the first quarter of 2015. While Notice of Default and Notices of Sales declined 8.8 percent and 9.7 percent respectively from the first quarter of 2015 to the first quarter of 2016, Lender Purchases (REO) increased by 100.6 percent from 357 to 716.

Quarterly Foreclosure Events in Prince George's County 3,000

23.1% 20.4%

2,500

20.1%

22.1%

22.2% 19.5%

19.0%

20%

2,000 15% 1,500

2,684

1,000

1,852

2,415

2,293

2,408

2,742

2,741

have gone through the foreclosure process and failed to sell at auction and are therefore owned by the bank or lender.

3rd Quarter 2014

4th Quarter 2014

1st Quarter 2015

Total Foreclosure Events

2nd Quarter 2015

3rd Quarter 2015

4th Quarter 2015

County Share of State Total

Source: RealtyTrac, Maryland Department of Housing and Community Development, HERO.

4

10%

5%

500

REO Properties are properties that

25%

1st Quarter 2016

0%


Increase in Median Sale Prices The median sale prices for new and regular resale of single-family housing units increased by 5.6 percent and 5.5 percent respectively. The largest increase in median sale price (10.5 percent) occurred for regular resale single family attached sales. Singlefamily attached median sales price for new units saw a decline of 2.8 percent. The largest decline in median sales price (9.7 percent) was for single-family attached REO sales.

Rents for Multifamily Units The average asking rent for multifamily units increased by $45 (3.6 percent) between the first quarter of 2015 and the first quarter of 2016. The County offers some of the more affordable rents in the region with average rents for a studio apartment $400 less than the region. The average rent in the County was $316 less than the region for a onebedroom apartment, $310 less for a two-bedroom, and $268 less for a three-bedroom apartment.

Multifamily Units Under Construction and Delivered The number of multifamily units under construction in the County decreased from 2,564 units in first quarter 2015 to 2,012 units in first quarter 2016. Deliveries fell from 262 units to zero over the same period.

Median Sales Price Percent Change by Transaction and Unit Type from 1st Quarter 2015 to 1st Quarter 2016 15% 10% 5% New

0%

Regular Resale REO

-5% -10% -15% Single-Family

Single-Family Attached

Condominium

Source: Metrostudy, www.metrostudy.com.

Asking Rent Per Unit

$1,300 $1,290 $1,280 $1,270 $1,260

$1,280

$1,250 $1,240 $1,230

$1,295

$1,250

$1,220 1st Quarter 2015

4th Quarter 2015

1st Quarter 2016

Multifamily Units Under Construction and Delivered 3,000

2,564

2,500 2,000

2,012

2,012

0

0

4th Quarter 2015

1st Quarter 2016

1,500 1,000 500

262

0 1st Quarter 2015

Multifamily Units Under Construction

Units Delivered

Source: CoStar.

5


Real Estate Change in Percent of Region's Commercial Real Estate in Prince George's County 1st Quarter 2015 Versus 1st Quarter 2016

COMMERCIAL MARKET

Volume of Industrial Space The County is a regional leader in terms of the volume of industrial space of all classes. The existing Rentable Building Area (RBA) of industrial space of all classes during the first quarter of 2016 (50,273,548 square feet) represented 32.6 percent of the total for the Washington D.C. Metropolitan Region. The County added 458,346 square feet of industrial from the first quarter of 2015 to the first quarter of 2016.

35% 30% 25% 20% 15% 10% 5% 0%

Vacancies

The vacancy rate for Class A and C Flex space in the County decreased significantly respectively by 7 percent and 4.1 percent during the period. Even though the vacancy rate for Class A Industrial space increased by 9.2 percent in the County during the period, it also increased by 9.2 percent for the region. The County experienced a decrease in vacancies for Class B Industrial (3 percent), Class B Flex (1.9 percent), and Class C Industrial space (1.1 percent). Note that a decline in vacancies is a positive development.

1st Quarter 2015

Change in Vacancy Rates 1st Quarter 2015 Versus 1st Quarter 2016 12% 10% 8% 6% 4% 2% 0% -2% -4% -6% -8%

Net Absorption

County

Region

Source: CoStar.

Total Net Absorption 1st Quarter 2015 Versus 1st Quarter 2016

Square Feet

Net absorption is the amount of space occupied at the end of a period minus the amount occupied at the beginning of that period, that is, the space vacated during the period. For the first quarter of 2016, Class A and B Industrial experienced total net absorption of more than 50,000 square feet. All classes of Office space and Retail experienced negative net absorption for the first quarter of 2016. Negative net absorption indicates that a larger volume of space was vacated than leased for the period.

1st Quarter 2016

Source: CoStar.

Percent Change in Vacancy Rate

There was a slight decline in the Class A Office market conditions in the County, but also a slight improvement for Class B. The vacancy rate for Class A Office increased by 1 percent while that for Class B decreased by 0.6 percent. At the same time, the vacancy rate for Class A Office space in the region declined by 0.2 percent, and rose 0.3 percent for Class B.

200,000 150,000 100,000 50,000 0 -50,000 -100,000 -150,000 -200,000 -250,000 -300,000

2015 Source: CoStar.

6

2016


Rental Rates

All classes of office space saw modest increases in rents from the second quarter of 2015 to the second quarter of 2016. Class A Office space experienced the largest increase of 6.2 percent. For the same period Retail jumped 5.6 percent and all classes of Industrial space saw increases with Class A Industrial space leading the way with an increase of 12.8 percent. Rental rates for Flex were mixed with Class B and Class C space gaining 2.2 and 2.7 percent respectively while Class A Flex space rental rates declined by 3 percent.

$40

45%

$35

40%

$30

35% 30%

$25

25%

$20

20%

$15

15%

$10

10%

$5

5%

$0

0%

County

Region

Percent Difference Region/County

Changes in Rental Rates

Rental Rate Comparison Prince George's County Versus Washington Region 1st Quarter 2016 Average Rent Per Square Foot

During the first quarter of 2016, the average rent per square foot for all types of commercial space was lower in the County compared to the region. The rental rates for office space were 30.9 percent lower than the region, retail was 19 percent lower, industrial was 11.7 percent lower, and flex was 23.4 percent lower than the region.

% Difference

Source: CoStar.

Prince George's County Percent Change in Rental Rates 2nd Quarter 2015 Verses 2nd Quarter 2016 14%

12.8%

12% 10% 8% 6%

6.2% 4.3%

4%

5.6% 3.5%

3.8% 2.2%

1.8%

2%

2.7%

0% -2% -3.0%

-4%

County Revenues CHANGES IN REVENUES

Change in County Source Revenues FY 2014 Actual to FY 2015 Actual 34.3%

There was an overall increase in local taxes from $1.44 billion in FY 2014 to $1.51 billion in FY 2015, reflecting a 4.8 percent increase. The two dominant sources of local taxes—property taxes and income taxes—accounted for 84 percent of all local taxes in FY 2015. By far, property taxes have been the leading source of revenues in the County, generating $705.1 million in FY 2014, and $720.9 million in FY 2015. From FY 2014 to FY 2015, there were increases in all of the four revenue sources. The most noticeable expansion came from Other Revenues (34.3 percent), followed by Other Taxes (9.7 percent), Income Taxes (6.1 percent), and Property Taxes (2.2 percent).

2.2% Property Taxes

6.1%

Income Taxes

9.7%

Other Taxes

Other Revenues

Source: Prince George’s County FY 2017 Budget.

7


Endnotes Office Classifications Class A Office: In general, a Class A building is an extremely desirable, investment-grade property with the highest quality construction and workmanship, materials and systems, significant architectural features, the highest quality finish and trim, abundant amenities, and first rate maintenance and management. It is normally occupied by prestigious tenants with above average rental rates and in an excellent location with exceptional accessibility. Class B Office: A Class B building offers more utilitarian space without special attractions. It will typically have ordinary architectural design and structural features, with average interior finish, systems, floor plans, and overall condition. It will typically not have the abundant amenities and location that a Class A building will have. Class C Office: A functionally or economically obsolete building is one that does not offer a viable alternative for space and does not “compete” with others of similar type for occupancy by businesses seeking a location for operations. These buildings will usually have externally visible physical or structural features as well as internal ones that render it undesirable to be leased and therefore not competitive with any other properties in the market.

The Maryland-National Capital Park and Planning Commission Prince George’s County Planning Department, Research/Special Projects Section 14741 Governor Oden Bowie Drive Upper Marlboro, MD 20772 www.pgplanning.org | 301-952-3065 | TTY: 301-952-4366

Prince George's Pulse Quarterly Report 2016 1st Qt Vol. 2 Issue 1  

Prince George's Pulse Quarterly Report 2016 1st Qt Vol. 2 Issue 1  

Profile for mncppc