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Salt Lake City, downtown booming, brushes off conservative image

Published: 03/20/2018
By Patrick Sisson, Curbed — It’s a proven formula for real estate success: Combine a thriving tech scene and downtown development with enviable access to nature, and residential property will boom.

From San Francisco and Seattle to Portland and Denver, proximity to both an outdoor lifestyle and a high-tech economy have helped Western cities boom. Grappling with housing affordability and gridlock, many have even become victims of their own success.

For those unfamiliar with Salt Lake City, Utah’s capital seems like an unlikely pick as an up-and-coming metro. Outside of assumptions about its conservatism, owing to its position as the seat of the Mormon church, Salt Lake City may offer only one frame of reference for those unfamiliar with Utah urbanism: a unique grid system, known as the Plat of Zion, that resulted in massive, oversized city blocks.

Those seeing Salt Lake City for the first time today would find a city, and downtown, starting to hit its stride. By many measures, Salt Lake City isn’t merely catching up with its peers, it’s booming. The Urban Land Institute ranked it the nation’s third-best market for commercial development in its 2018 Emerging Trends report, fueled in part by the big names relocating here (Goldman Sachs’s second-largest U.S. office is in town).

A booming regional tech economy, dubbed Silicon Slopes, includes homegrown firms valued at more than a billion dollars total, as well as offices for big names such as Adobe, Twitter, and Electronic Arts. Literally and figuratively adding runway to the region’s economic growth, a $3.6 billion airport renovation will open in 2020.

This growth, in a city just a few hours from numerous world-class ski resorts and national parks, has fed a rapidly appreciating real estate market, both regionally and downtown. The state’s population grew 9 percent over the last five years, much of it concentrated in Salt Lake City, where the median sales price for a home at the end of 2017 was $273,000 (still significantly lower than the average in Austin and Denver). Realtor.com doesn’t see things stopping anytime soon, naming Salt Lake one of 2018’s hottest markets and predicting a 4.5 percent increase in home sales.

Apartment development has blossomed in Salt Lake City, as trendy areas such as Central 9th and the Depot District have seen the explosion of restaurants, coffee shops, and breweries associated with more livable neighborhoods. In 2010, downtown had just 5,200 rental units. By 2020, that number will nearly double to 10,000, including units in a new $90 million high-rise called Liberty Sky, a 24-story all-residential tower unprecedented in Salt Lake’s history. It seems like a solid bet; downtown’s population is expected to surge to 20,000 by 2020, and apartment vacancy currently hovers at a minuscule 2 percent.

The city is becoming what young adults from the region and elsewhere have wanted for years, according to Isaac Riddle, a journalist, Salt Lake native, and founder of Building Salt Lake, a key source of real estate and development news.

“Ten or 15 years ago, when someone finished college, like myself, they left,” he says. “A lot of us are now coming back, and those who are graduating are staying. Now, Salt Lake City has amenities you used to have to go to Denver, Portland, or the Bay Area to get. You can stay in Salt Lake now. And you can see the energy.”

The city seems to have hit critical mass. Salt Lake County, which includes Salt Lake City, is forecast to add nearly 600,000 new residents by 2065, according to a University of Utah study, a 50 percent growth rate.

“Compare it to Portland, Seattle, LA, and San Francisco, where everything has become expensive,” says Dave Ward, a developer at the Boyer Company, a partner in 111 Main. “Comparatively, Salt Lake City is easy to get around, has tremendous outdoor recreation options, and people can live near where they work. When you look at the quality of life and the ability to further a good career, Salt Lake has a pretty compelling argument.”

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