Colorado Springs Apartment Performance Reaches New Peak

In the past few months, Colorado Springs has seen notable improvement in apartment market fundamentals, with rent growth and occupancy both hitting high points in May. Annual effective asking rent growth surged to 11.3% in May, the strongest reading this market has seen in at least two decades. Colorado Springs, nestled at the foot of the Rocky Mountains, is no stranger to big rent growth. In fact, annual price increases held above the 10% mark for six straight months in the latter half of 2016, but rent growth has not breached the 11% threshold until now. Allowing operators to push prices recently, apartment occupancy in Colorado Springs has been bumping up against the 97% mark for much of the past year. In fact, in April and May, occupancy held steadily at 96.9%, some of the strongest rates this market has seen since late 2000. Anchoring apartment demand in Colorado Springs is a balance of stable defense employers coupled with some fast-growing, high-paying job sectors, which have helped the market remain resilient against the COVID-19 pandemic and recession. As of April, total employment in this market is only 1.9% away from a full recovery. At the same time, new supply volumes have remained moderate, though have been slightly elevated – by local standards – in the past two years.