Significant ink has been spilled theorizing how Philadelphia might lure a certain online behemoth to town. Amid all the Amazon cheerleading, it’s worth wondering what an influx of 50,000 jobs might do to real estate in the region (among other effects). Real estate firm Apartment List recently handicapped the top metro contenders for the new headquarters, crunching numbers on impacts regarding rent and density.
The Apartment List study points out that along with the influx of jobs, Seattle — Amazon’s current hometown — has experienced rent increases outpacing almost the entire rest of the nation. In general, statisticians there predicted an extra 2 percent rate of annual growth (on top of the usual steady rent increases) for the winning metro, equating to nearly $30,000 in additional rent over 10 years on average.
In Philadelphia, analysts predicted an increase between 0.6 and 0.8 percent each year, what they characterize as a “moderate” rent increase. They further hypothesize that the higher (9 percent) vacancy rates here would help cushion the market response. They also point out that Philadelphia approved fewer than 11,000 new building permits a year between 2005 and 2015 – a pace they predict will have to quicken to manage new Amazon employees. Their analysis points to Raleigh, San Jose, Baltimore and Pittsburgh as cities that could expect the most severe rent increases.
Take a look at the whole report and see how our region stacks up against competitors including Raleigh, San Jose, Baltimore, Denver, Austin, Detroit, Minneapolis, Boston, Atlanta, Chicago, Washington, D.C., Los Angeles, Dallas and cross-commonwealth rival Pittsburgh.