OKC MAPS Economic Impact - Full Report

OKC MAPS PROJECTS – 25 YEARS

Downtown Office Market Downtown remains a key office market both citywide and in the broader metropolitan area. MAPS- related improvements in the study area were anticipated to trigger increased office market development in the downtown area. Rising business formation and employment described earlier in the report have accompanied a substantial increase in the downtown office market in recent years. Office Property Valuation Changes . Figure 41 summarizes the change in office market valuations and square footage in the study area in two-year intervals in the 2009 to 2017 period. The downtown office market posted substantial growth between 2009 and 2017. Total market value of all office properties in the study area more than doubled (130% gain) from $487 million in 2009 to $1.1 billion in 2017. The 130% gain in office valuation exceeds the 92% gain across all property types in the period. Much of the gain occurred between tax years 2011 and 2013 as Devon Tower entered the tax rolls. As a share of total property values downtown, office space has risen from 24.0% of total valuation in 2009 to 28.7% in 2017. The 130% gain in the value of downtown office property is also double the 64% growth for all office properties at the county level. The downtown area now accounts for 30% of the total value of office space in the county, up from only 21% in 2009. Office Gains Outpace Non-Office . The $634 million rise in office valuations comprises a large share of the total gain in value across all property types between 2009 and 2017. Rising office values account for about one-third (33.8%) of the total $1.87 billion increase across all property types. For comparison, non-office property increased by a combined $1.24 billion in the period. Despite a larger share of the total gain, non-office properties experienced a smaller percentage gain of 80% across the period. Gains in Per Foot Values . The average value of downtown office space per square foot surged along with total valuations between 2009 and 2017. After averaging less than $40 per square foot in both 2009 and 2011, average assessment values for office space jumped above $77 in 2013 and averaged more than $74 across the 2013 to 2017 period. Much of the rise in both square foot and total valuations reflects both the large size and relatively high cost per square foot of Devon Tower (more than $380 per sq. ft.). Office Square Footage . Total assessed office space downtown continues to rise as well. Total office square footage in the study area increased from 12.95 million sq. ft. in 2009 to 14.6 million in 2017, a 13% gain in the period. The increase in office space slightly trails the 17% gain in total square footage across all sectors in the study area in the period. Office space as a share of total taxable space has also declined slightly from about 37.1% in 2009 to 35.7% in 2017 as other sectors added space more consistently over the period. Total office space in tax year 2017 does not yet include the newly constructed BOK Park Plaza. It is the first speculative office building constructed in downtown since the oil-Boom era Leadership Square was completed in 1984. At an estimated cost of $270 million, the new downtown offices of BOK in Oklahoma City are slated to be added to the tax rolls in tax year 2018. 47 The 27-story building has approximately 690,000 square feet of space across 25 floors including class-A office space, retail, dining, and fitness facilities. The building is located directly along the streetcar line in the business district and is the sixth tallest building downtown. 48 Its introduction will add an estimated 25% to total office property

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