Regional Resurgence

October 23, 2013

Sacramento was hit hard by the downturn and has been slow to recover, but there are emerging indications that the economic tide is turning in the state capital.

Keeping the Kings in Sacramento and the subsequent plans to build a state-of-the-art Entertainment Sports Complex (ESC) in downtown is a major coup for the entire business community. The ESC is projected to bring in millions of new visitors to downtown Sacramento, prompting plans for expansion along the 700 block of K Street. Work will begin in the fall of 2014, with the arena slated to open by October 2016.

An estimated $1 billion in private capital aimed towards new development will transform Downtown Sacramento into a renaissance city that attracts young professionals. National retailers have previously passed up the Sacramento Region for larger markets. The synergy from the ESC is attracting an array of national tenants and small businesses. Bay Area companies seeking to expand without the burden of skyrocketing rents are beginning to view the Sacramento market in a completely different light.

Significant job growth is needed for the Sacramento commercial real estate market to continue to recover. According to the Threshold Report, “An entertainment and sports complex has the potential to be a significant job producer and economic catalyst for Sacramento. The ability to generate over 4,000 jobs represents the type of development activity needed to help stimulate the economy immediately and create a platform for sustained economic growth.”

·        The ESC will create 4,095 total jobs.
·        Generate $556 million in total spending and $11.3 million in fiscal benefits to government agencies during the construction period.
·        $300 million in direct spending, with $105 million in the City of Sacramento.
·        $231 million in indirect and induced spending, with $81 million in the City of Sacramento.
·        $2.3 million in fiscal benefits to local government agencies.

Jeff Glenn, Managing Director