Special Edition 2020
COVID-19: How did we get here?
January 2, 2020: Pneumonia like outbreak in Wuhan, China, identified as a new coronavirus
January 21, 2020: First confirmed case of COVID-19 identified in Washington state
January 22, 2020: Economist, Rich Wobbekind speaks at BizWest Economic Forecast, predicting, "No recession on the horizon"
February 24, 2020: U.S. stock market plummets over COVID-19 fears, after the Dow Jones Industrial Average experiences the worst day in two years
February 29, 2020: First recorded death from COVID-19 is reported in the U.S.
March 6, 2020: $8.3 billion emergency spending package signed to combat COVID-19
March 11, 2020: World Health Organization declares COVID-19 outbreak as a global pandemic
March 13, 2020: National state of emergency is declared, freeing up $50 billion to help fight pandemic
March 18, 2020: Trading halted on Wall Street for the fourth time in two weeks
March 19, 2020: California issues a state wide "stay-at-home" order, New York, New Jersey and other states begin to follow suit
March 20, 2020: Wall Street suffers worst weekly performance since the 2008 financial crisis
March 25, 2020: World Health Organization warns U.S. could become the global epicenter of the COVID-19 pandemic, with 54,810 cases, including 781 deaths
March 26, 2020: Colorado stay-at-home order in effect until April 11th, a day after Larimer and Weld counties issue their own stay-at-home order. U.S. COVID-19 cases surpass China with 82,474 cases and more than 1,100 deaths reported
March 27, 2020: Unemployment filings spike to over 3.28 million nationwide - the largest number ever recorded in history. The House and Senate pass a $2 trillion stimulus package, the largest emergency aid package in U.S. history
Source: NBC News
Realtec is Here to Help

With our local and national real estate economy resting on uncertainty, don’t hesitate to reach out to your advisor at Realtec. Realtec can assist with navigating the new normal and provide clarity, whether you're a tenant or landlord. We're here to help provide up to date information on the Northern Colorado climate.
The Colorado Economy: Climate of Uncertainty
In a matter of a few weeks, daily lives have changed throughout Colorado. The spread of the Coronavirus (COVID-19) has hit the economy hard which as a result has left the real estate market holding its breath. Throughout Colorado, all non-essential businesses, including retailers, restaurants and bars, ski resorts and athletic gyms have been forced to close temporarily, leaving hundreds of thousands without jobs. As of March 27th, unemployment claims in the Colorado Department of Labor and Employment have sky rocketed by more than 737%. The state labor department reported more than 25,000 claims last week, up from 1,325 the previous week. It is expected claims will continue to grow at an unprecedented rate over the next few weeks. By this summer the unemployment rate in Colorado is expected to sit around 10.7%, up from the historic low of 2.7% for the period of October 2019 through January 2020. Morgan Stanley has predicted a record-breaking 30% decline in the GDP for the U.S. for the next three months, raising the question if the pandemic has prompted the onset of a recession. On a recent SmartAsset report, Fort Collins was ranked number 22 out of 264 cities for “most recession-resistant cities”.

Impact on Retail and Office

Due to all non-essential businesses closed through April, many retailers have begun contacting their landlords to discuss what their options are if they cannot make rent and must close locations permanently. These types of revenue losses due to the pandemic are posing the question if this type of situation can trigger force majeure provisions, also known as “acts of God” clauses in contracts and leases.

As for the office market, it’s predicted the strain from the pandemic will be felt more towards the second half of 2020. It’s still too early for any meaningful data on the slowdown of leasing activity, but with the heightened uncertainty of the economy, many tenants have been hitting the pause button and plan to reevaluate their needs during this period of business interruption. Just a few weeks ago, what was seen as a strong market in favor of landlords, may be transforming into a tenant's market.

Source: CoStar
Oil and Gas Prices

Oil and gas companies across Colorado have begun to cut production due to COVID-19, but also mainly in part due to the price war taking place between Russia and OPEC. West Texas Intermediate crude (WTI) saw a 24.59% decrease in price per barrel on March 9th after OPEC was unable to secure a deal with Russia on production cuts to support prices. The benchmark WTI crude price fell from over $60 per barrel at the beginning of January to nearly $30 per barrel as of the second week of March. As of March 17th, WTI was trading at $27.89 per barrel and as of March 30th, WTI was trading at $20.23 per barrel. Some Landlords in Colorado have been asked to begin cutting rent by up to 50% for the next few months to help with income loss and then reevaluate the rent once more is known about the global crisis.

Sources: CNBC , Denver7 , CoStar
On a Positive Note: Lanny Duggar of Realtec Greeley awarded Rookie Broker of the Year Award
Loveland, Colorado

Northern Colorado Commercial Association of Realtors (NCCAR) held their first annual Titan Awards which recognized top producers in Northern Colorado for their 2019 sales and accomplishments, held on February 19th, 2020. Lanny Duggar, of Realtec Greeley , was awarded the Rookie Broker of the Year. Mark Bradley, Managing Broker of Realtec Greeley , commented, "We were excited that our newest Realtec Greeley broker won the Rookie Broker of the Year Award at NCCAR’s first Titan Awards. While Lanny is a rookie in real estate; he brings to us over forty years of business and operations experience which shows in the way he helps his clients. Congratulations, Lanny!". Duggar joined Realtec Greeley in 2018 after a successful career as an executive in manufacturing and distribution, to pursue his passion for real estate.
CoStar Market Reports - Larimer and Weld County