Salt Lake City Is Thinking Big To Keep Pace With Growth
Editor's Pick - December 10, 2019 - Brenda Richardson, Senior Contributor Real Estate
Salt Lake City is flourishing in innovation and growth while nurturing an entrepreneurial environment and economic development. The capital of Utah has been busy with a massive expansion of its airport, reinvigorating its downtown and experiencing a building boom. With that growth come challenges and phenomenal opportunities. Salt Lake is the most populous municipality in Utah and core of the greater Wasatch Front metropolitan area, which has a combined population of aproximately 2,600,000 residents.
“The population has been growing at a fast pace,” said Jacob Maxwell, workforce development manager at Salt Lake’s Department of Economic Development. “The business-friendly climate and corporate tax rates bring a lot of business here, so it brings a lot of opportunity, which has caused our unemployment to be so low. And we create a lot of jobs and a lot of job availability here.” Much attention has been paid to the Salt Lake City metro area, but that’s not the only place where the city is thriving. Thanks to the surge in development, people are moving downtown and looking for options to live, work and play. Local leaders are focusing on smart growth to reduce traffic, pollution and commute times. The city offers a variety of public transit options operated by the Utah Transit Authority.
A new performing arts center is reinvigorating the downtown and civic pride. The Eccles Theater has received unprecedented attendance since it opened in 2016. Ballet, musicals, drama, comedy, lectures and music flourish at the performing arts and rental venue, according to artsaltlake.org.
“We can now book large extended stay Broadway shows there,” said Maxwell. “Our government actually pays for much of the performing arts infrastructure. There are ticket sales, but those ticket sales by far do not cover the costs to deliver those services, so it’s a huge amenity that other cities don’t typically offer.”
City Creek Center, the retail centerpiece of one of the nation's largest mixed-use downtown redevelopment projects, is in the heart of the city. The unique shopping environment features a retractable glass roof, a creek that runs through the property, a pedestrian skybridge and more. The world-class fashion and dining destination offers over 100 stores and restaurants including Nordstrom, Macy's, Tiffany & Co., Michael Kors, Coach and Texas de Brazil Churrascaria in a casual pedestrian-friendly environment.
Salt Lake City takes its food scene seriously with more than 2,000 restaurants that run the gamut from national fast-food chains to independent fine dining establishments. “We do have a great food scene, including breweries and distilleries,” said Maxwell. “We have 13 breweries in Salt Lake City alone.”
Dee Brewer, executive director of Downtown Alliance, a nonprofit organization in Salt Lake City that supports many of the businesses, organizations and events that occur downtown, said the nighttime economy is “an important part of the ecosystem” that is growing in Salt Lake City. He noted that when he moved back to Salt Lake City in the early 2000s, Main Street was very different than it is today. “It’s like night and day,” he said. “There were a lot of vacant stores on main street, a lot of empty shops. Now they are full of stores, art, venues, bars, restaurants, and you drive around at night and it’s just a hive of activity. It really demonstrates the health and vibrancy of our downtown community.”
Derek Miller, president and CEO of the Salt Lake Chamber and Downtown Alliance, said the business association has been working harder to keep pace with the continued growth and upcoming projects. “We’ve added 2,000 new residents to the central business district downtown since 2011, and we are on track to add 2,000 more in just the next year alone,” he said. “Growth and everything that comes with it is our number one challenge.”
Brewer pointed out the city is experiencing a tech boom. “We currently have about 77,000 employees on a daily basis in Salt Lake City. Many of them live and work downtown, but many of them come in to downtown.”
He added, “On the tech side, we have just under a hundred tech companies that are located in our downtown area, and that brings a lot of highly educated and young talented workforce. The median working age in Salt Lake City is just 33 years old.”
Salt Lake is home to several financial services companies, including Goldman Sachs, Wells Fargo, JPMorgan Chase and Fidelity Investments. The city is focusing on long-term resilience as it navigates its way through maintaining competitiveness. Robust job and population growth over the past several years have helped sustain elevated levels of new multifamily construction.
Maxwell said Salt Lake is not concerned about who will fill the gap if and when Baby Boomers exit the workforce. “If there’s one thing Utah is really good at, it is having kids, so our population pyramid is very strong,” he said. “We have a lot of young people at the base, a disproportionate amount of young people who can eventually fill the vacancies left by those exiting the workforce, right here, homegrown. We don’t have to rely as heavily on in-migration. We really have a lot of people here, so tapping into that at a state level is hugely important for companies.”
Major projects such as Kensington Tower, a residential high-rise, is under construction, replacing a fast-food restaurant and large parking lot with a 39-story vertical urban community that the developers say will fill the need for high-end rentals. The developer has set sustainable goals for building and construction.
Maxwell said there is demand for multifamily and higher density housing in Salt Lake. “Salt Lake City proper has been leading the way in density,” he said. “Other communities around us have started to try to loosen their zoning to accommodate more density. Utah was originally designed with no intention of having this kind of density, but now with our population growth, we have to confront the fact that we are several units short of multifamily and low-income housing. I believe we have about 3,000 to 5,000 units coming online in the next couple of years. We’re hoping that through our example, other communities around us also will start to adopt more density.”
Salt Lake is seeing more transit-oriented development along the transit line. “We certainly need to see that extend to all parts of the Valley,” said Maxwell. “Right now, there’s a lot of resistance, especially on our east side. It’s resistance to housing density, and it’s generally a height issue with large condo and apartment complexes. People like to preserve their suburban neighborhood feel. People purchase on the east side to have a single-family residential experience, so they are a little resistant to the type of density that the county needs.”
Just minutes from its burgeoning downtown Salt Lake is building what will be the first new hub airport in the country in the 21st century. The airport is expected to secure the city’s position as a global aviation hub that will serve and grow with the region for decades to come. In September 2020, the Salt Lake City Department of Airports plans to open the first phase of the new airport.
Miller said the tremendous growth downtown and in Utah in general means Salt Lake is in “desperate need” of additional housing stock and affordable housing. “Our transit line is a blessing in that regard because affordable housing has been developed along that transit line,” he said. “It helps deliver workers downtown. There are projects planned for affordable housing downtown, but those are limited and will always be limited by the cost of land in the urban core. But they are being built, and there is additional stock being added.”
“Right now we are not in a crisis, but we do have a shortage,” explained Miller. “Housing prices have not turned into something like San Francisco or Seattle. We’re not in that position. And the state is working very hard to ensure that we do not get to that point. There is a huge dialogue around ensuring that we stay ahead of the housing shortage and then trying to work on any types of changes that will help with that. I feel confident that Utah is the kind of state and historically has been the kind of state that promotes collaboration across all sectors and that we will be able to figure that out. That’s one of our biggest traits as well, and I think that’s something that companies report as being a huge asset here. It’s just the spirit of collaboration. Nobody remains siloed. We all come together towards that common cause.”
The convention and meeting business here is significant and material to Salt Lake’s economic performance. “We have about 780,000 visitors for meetings and conventions each year and their spending is significant,” said Brewer. Salt Lake is a venue for the Sundance Film Festival and an independent film community. The 10-day festival spreads out across two other greater metro locations: Park City and the Sundance Mountain Resort near Provo.
The downtown is poised to attract even more visitors with the addition of a huge convention center hotel and other planned full-service hotels in the vicinity. The hotel will be connected to the southeast corner of the Salt Lake Palace Convention Center. “It will be 28 stories with over 700 rooms and 62,000 square feet of meeting space,” said Miller.
Brewer added, “We have a very robust airport, a very robust convention center. The piece we needed to shore up was the hotel rooms. So the addition of the convention center hotel will mean even more large-scale conventions here in the city and more spending. That stimulates the nighttime economy, enables more restaurants and bars, which also becomes a benefit for those recruiting talent to downtown as well.”
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