Transcript PPT - Energy and Water Economics

May Town Center
Presentation to
Metro Planning
Regional Economic Impacts
of Construction, Residential and
Commercial Activity
William W. Wade
Energy and Water Economics
April 16, 2008
Presentation Outline
1. Regional Economic Impacts Briefly Introduced
2. Overview of May Town Center Project
3. Construction
4. Residential Spending
5. Office and Commercial
6. Total Regional Economic Impacts
7. Government Revenues
E&WE
2
May Town Center
Five Easy Numbers
May Town Center
Broad Summary Impacts $ 2007
Total Employment @ 2026
Total Wages paid @ 2026
Davidson Cumulative Govt. Revenues
Regional Output Inc @ 2026
Economic Migrants by 2026 #
E&WE
$ million
95,234
$6,330
$895
$15,720
82,200
3
1 Regional Economic Impacts
Briefly Introduced
Why do Regional Economic Impact
Assessment?
To understand the effects of changes in business activity
on the regional economy and government revenues: e.g,
•
Slow down in Music Row Activity;
•
Industry/plant relocation;
•
Condo residential additions to Downtown;
•
On-location movies – Hanna Montana;
•
Addition of May Town Center Commercial and Residential.
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What do you measure?
Direct and Secondary Economic Effects
Economic impacts are classified as direct, indirect and induced.
Direct impacts are the primary change in the regional economy.
Indirect impacts result from changes in sales of suppliers to the
directly-affected businesses.
Induced impacts result from changes in spending on consumer
goods and services as a result of changes in employment and
payroll of directly and indirectly affected businesses.
Impacts can be referred to as direct and secondary effects.
Total Impacts are the sum of direct plus secondary effects.
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Example: New Money spent on
Recreation
TVA Regional Boundary
--------------------------------------------------------------------------------------------------------------------------
$
DIRECT EFFECTS
Additional spending on
recreation
Increase in output/income
of local businesses
------------------------------------------------------------------------------------------------------------------------
Leakage
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SECONDARY EFFECTS
Non-Local
Businesses
(Money
leaves the
regional
economy)
New round of spending
Local Businesses
(Money stays in the
regional economy)
Increase in local
output/income
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Economic Impact Analysis of May Town
Center
Inputs
Direct Effects
Construction
Outputs
Computer
Simulation to
determine
secondary effects
Total Effects as
measured by:
Total Regional
Output
W h a t e ffe c t
w o u ld P o lic y X
have?
Residential
Office
Development
Commercial
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C h a n g e in p o lic y
v a r ia b le s
a s s o c ia te d w ith
P o lic y X
The R E M I M odel
B a s e lin e
v a lu e s f o r a ll
p o lic y
v a r ia b le s
Employment
C o n tro l F o re c a s t
A lte r n a tiv e F o r e c a s t
Personal Income
C o m p a re F o re c a s ts
Government
Revenues
REDYN
Economic
Model
In other words, Economic
Development of Davidson and
Metro MSA
8
Measurement of Economic Impacts
Measure changes in policy variable associated with two
forecasts – the difference is the impact.
New Forecast
Economic Effect
of Driver[s]
Control Forecast
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2010 2011 2012 2013 2014 2015 2016 . . . . . 2026
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2. Overview of May Town Center Project
May Town Center Drivers:
Overview of Project
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Offices
10.0 MSF
Commercial
1.5 MSF
Residential
7.0 MSF – 5,000 units
Build out
2010 – 2024
Absorption
2011 - 2026
11
May Town Center:
Aggregate Market Value by Property Type
Aggregate Market Value
$ Billion
$4.5
$4.0
$3.5
$3.0
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
2026
2025
2024
2023
2022
2021
2020
2019
2018
Office
2017
2016
2015
E&WE
2014
2013
2012
2011
Residential
Commercial
12
Regional Economic Effects Extend Beyond Metro
Nashville
May Town Center on the west side of Nashville will stimulate growth
across the region.
Economic Impacts are tracked in this analysis by specific counties to
reveal the broad economic stimulus.
•
•
•
•
Davidson
Dickson & Sumner
Rest of Nashville MSA, excluding Davidson, Dickson & Sumner
Rest of Tennessee.
REDYN Model results are produced annually thru 2026.
Results are reported in constant $2007
REDYN economic and demographic modeling system (REgional
DYNamics) is a nonlinear, dynamic, forecasting and economic impact
model. It provides advanced, impact, policy, and forecasting analysis
for public and private plans, programs, and projects.
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3. Construction
May Town Center: Construction Direct Costs
Firms will respond from the multi-county region to project’s
construction demand.
Hard Construction Costs $ Million
Annually:
2010 - 2024
$ Million
Office Core
Office Campus
Corporate Office
Cmcl-Retail
Cmcl-Restaurant
All Residential
Total
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Total
$47
$30
$25
$13
$6
$65
$700
$450
$375
$198
$89
$980
$186
$2.8
Billion
15
Total Construction Employment:
Direct plus Secondary Effects
Direct jobs at the project will create new jobs across the
region as project and vendor employees re-spend wages
and salaries and profits.
Area
Job-Years
#Years
Average
(multiplier)
2010-2024
Jobs/Year
Davidson
13,683
15
912
Rest of MSA
29,024
15
1,935
Rest of
Tennessee
7,661
15
511
TOTALS:
50,368
15
3,358
including Dickson & Sumner
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Total Construction Related Jobs:
Direct & Secondary Employment Effects
Construction Job Impacts
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
Dickson & Sumner
Rest of TN
Davidson
MSA excl Davidson-Dickson-Sumner
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4. Residential Spending
May Town Center: Residential Buildout
Residential Build out - Units
5,000
4,000
3,000
2,000
1,000
0
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
Occupancy by Families
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Residential Household Income and
Direct Spending.
Residential Income & Spending
$1,000,000
$900
$800
$700
$600
$500
$400
$300
$200
$100
$0
$140
Million
2026
2025
2024
2023
E&WE
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
Total Income
Retail Spending
Total economy-wide personal income & consumer
spending will reflect the new office & commercial jobs in
the new business developments.
20
5. Office and Commercial
May Town Center:
Office & Commercial Development
Will attract new businesses and employees.
Well-educated mobile employees attracted by the visual
amenities, superior affordable housing, and work that
involves education, experience, and expertise.
Office workers are expected to include tenants such as
managers, administrative & support firms, professional
& technical firms, finance & insurance firms, and real
estate firms.
Commercial workers are aimed at retail stores and fullservice restaurants.
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May Town Center: Office Employment
Direct Office Job Creation
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
Management
Finance/Insurance
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Admin
Real Es tate
Professional
23
May Town Center: Retail & Restaurant
Retail space responds to the need for excellent
shopping environments to gain & keep the US
knowledge worker.
Restaurant space aims at the demand for a superior
dining experience.
Retail tenants should meet new demand and not “crowd
out” existing retail jobs.
Restaurant tenants will “displace” some existing
restaurant jobs elsewhere.
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May Town Center:
Direct Retail & Restaurant Employment
Retail Sector Direct Job Creation
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
E&WE
2016
2015
2014
2013
2012
Retail
Restaurant
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May Town Center:
Total Direct Employment
May Town Center:
Total Direct Employment
42,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
E&WE
2013
2012
Office Jobs:
Retail Jobs:
26
Total Regional Job Growth:
All Drivers plus Multipliers
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Adding May Town Center to the Metro Economy
creates new employment across the region.
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May Town Center
Employment Impact by Sector - Davidson
Davidson County Employment Impact by Sector - 2026
NAICS
56
54
52
44
53
62
55
72
81
61
23
51
42
71
48
31
93
22
21
11
98
E&WE
Administrative and Support and Building Services
Professional, Scientific, and Technical Services
Finance and Insurance
Retail Trade
Real Estate and Rental and Leasing
Health Care and Social Assistance
Management of Companies and Enterprises
Accommodation and Food Services
Other Services (except Public Administration)
Educational Services
Construction
Information
Wholesale Trade
Arts, Entertainment, and Recreation
Transporatation and Warehousing
Manufacturing
Government
Utilities
Mining
Agriculture, Forestry, Fishing and Hunting
Non-NAICS Industries
Total
Employment
19,432
13,910
7,249
4,948
4,589
3,006
2,074
1,984
1,422
1,244
1,097
881
872
749
728
716
414
13
10
6
1
65,344
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6. Total Regional Economic Impacts
May Town Center:
Economic Migration
Economic Migration: Age 25 - 55
10,000
8,000
Total
6,000
4,000
2,000
Davidson
MSA excl
Davidson
33,183
Rest of TN
11,383
82,188
37,621
0
2026
2025
2024
2023
2022
MSA excl Davidson
2021
2020
2019
2018
2017
2016
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2015
2014
2013
2012
2011
2010
Davidson
Rest of Tn
Economic migration includes employment seekers
+ dependents, but excl children by definition.30
May Town Center:
Total Personal Consumption Demand Growth
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Total Regional Output (Sales) Growth
Regional Total Output Effects
$ Billion
$16
$14
$12
$10
$8
$6
$4
$2
$0
2026
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
Dickson & Sumner
Rest of TN
MSA excl Davidson-Dickson-Sumner
Davidson
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7. Government Revenues
Davidson County
Direct Project Government Revenues
Direct Property plus Sales and Use Government Revenues $ Million
2012 2018 2024
Total
Constr Mtls Sales Tax
$2.5 $2.5 $0.0
$38
Other Fee Rev (Family)
$0.5 $2.0 $3.8
$34
Local Sales Tx (Family)
$0.4 $1.7 $3.2
$29
Offc & Cmcl Property
$2.4 $17.9 $37.9
$307
Residential Property
$2.5 $10.1 $18.9
$170
Total Direct
$8.4 $34.2 $63.8
$578
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Davidson County
Total Property & Sales Tax Revenues
Total Property plus Sales and Use Government Revenues $ Million
2012 2018
2024
Total
Constr Mtls Sales Tax
$2.5
$2.5
$0.0
$38
Other Fee Rev (Family)
$0.5
$2.0
$3.8
$34
Local Sales Tx (Family)
$0.4
$1.7
$3.2
$29
Offc & Cmcl Property
$2.4 $17.9
$37.9
$307
Residential Property
$2.5 $10.1
$18.9
$170
Total Direct
$8.4 $34.2
$63.8
$578
Total w/Multiplier
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$8.4
$50.2
$99.5
$897
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May Town Center: Annual Tax & Fee
Revenues to Davidson County
May Town Center:
May Town Center:
Davidson County Tax & Fee Revenues
$140
$120
$140
$100
$120
$80
$100
$60
$40
$80
$20
$60
$0
2025
2026
2024
2025
2026
Sales Tax and Fees
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2024
2023
2022
2021
2020
2019
Property Tax
Property Tax
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2018
2017
2016
2015
2014
2013
2012
2011
$40
$20
$0
2010
$1000000
$1000000
Davidson County Tax & Fee Revenues
Sales Tax and Fees
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