Cranes have increasingly dotted the sky in Seattle over the last few years as new towers transform the skyline. And it’s only just beginning.
We’ve covered how Seattle’s tech boom has juiced the local office market, and it is doing the same for apartments. As companies like Amazon, Microsoft, Facebook and others grow, they bring in new people every year, and others move here to take advantage of job opportunities. Naturally, all these people need places to live.
According to a report from Colliers International, the period between 2010 to 2020 could see 100,000 new apartments built in King, Pierce and Snohomish counties. Across the region, 46,264 apartments were built between 2010 and 2016, with another 62,121 planned between 2017 and 2020. If all those units get built, that would add 108,385 apartments to the regional stock of 219,463 apartments, representing a 49 percent increase. The report doesn’t make it clear if those figures account for the number of apartments knocked down to make way for new buildings, so the actual net increase in housing stock might be lower.
The only other comparable period came in the late ’80s and early ’90s when more than 80,000 units were built in the area. The big difference between that boom and today’s is that most of those units were built in the suburbs, whereas today much of the focus is on the most densely-populated areas. “Urban King County,” defined in the report as most of Seattle, as well as the denser parts of Bellevue and Kirkland, has 54,768 units planned or under construction, accounting for 67 percent of the apartment pipeline for the three counties.
It’s no surprise that South Lake Union, which has become an epicenter for technology companies local and out-of-town, is the hottest apartment neighborhood in the region. According to the report, 9,831 units are in the pipeline there, which is just a shade ahead of downtown Seattle.
All this new construction is starting to blunt rent increases that have risen close to 40 percent in the last five years in the most urban neighborhoods. In 2016, rents rose 5.4 percent in those areas, down from 7.1 percent in 2015 and 8.2 percent in 2014.
Jobs are playing a big role in driving this boom. The Seattle area boasts a lower unemployment rate and greater average wages and employment growth than the rest of the U.S., according to the report. The number of jobs created locally has exceeded expectations for several years in a row.
While the tech industry gets most of the headlines — including this one — the fastest growing industry in 2016 was construction. After all, someone has to build those 100,000 apartments. Computer systems design, management positions, and food service jobs were also among the fastest growing titles in the report.
Plenty of companies are hiring, but no one can match Amazon’s appetite for new people. According to the report, Amazon has 24,700 people in the Seattle area, but that number could rise quickly, as the company has more than 12,200 open positions. By contrast, Microsoft, consistently one of the top employers in the region, has more than 43,000 employees but only about 1,200 open positions.