Palm Springs Economic Boom Begins!!!!
Palm Springs is back in business! The recession appears to be coming to a close. All season (December to April), the streets of Downtown and uptown were jammed, the eateries were packed, the hotels booked and cash registers were ringing. It was noticeable to everyone. And, the locals are grateful. The City Council is thrilled. One of my friends quotes, “Palm Springs is fun again!”.
Hank Plante (an Emmy and Peabody Award-winning journalist) wrote a powerful article in the SF City Buzz Examiner to this effect. It is so powerful, that I re post here:
That faint “boom” you hear in Palm Springs these days isn’t coming from this weekend’s Coachella Music Festival, it’s the sound of an economic recovery that’s as real as the numbers behind it.
If you’ve spent any time walking through downtown Palm Springs – or the Uptown district as well – you’ve noticed the crowds, the busy restaurants and the hum of a comeback. That feeling is more than just wishful thinking.
Every economic number is moving upward, and in economics – as in politics – it’s the trend line that is most important.
Look at recent headlines: “Retail had a ‘booming’ holiday,” “Economic Return,” “Modernism Week Attendance Surges.”
Now look at the real data behind those headlines: hotel occupancy was up 9.5% during the fourth quarter of 2011, while the number of airport passenger grew 11.3% during the same period. Record crowds were reported for Modernism Week, the Dinah Shore weekend and the White Party. The Tour de Palm Springs drew over 9,000 riders. The list goes on.
And then there’s real estate. Home and condo foreclosures fell 17% in February (Valley-wide) and real estate sales rose for the eighth month in a row. In other words, sales are up, inventory is down, foreclosures are harder for investors to find, and prices are rising in desirable neighborhoods. Local realtors report the so-called “bottom” of the market appears to have happened last summer. Today, properties in Palm Springs under $500,000 sell almost immediately, while homes above that price that have been renovated are again selling with multiple offers. And as for who’s buying, it’s not just gays and lesbians with taste and disposable incomes, it’s also a new mix of demographics: younger straight couples moving in from the outer suburbs because they’re attracted to the city’s vibe, and who want a safe, comfortable environment for their children.
None of this is lost on retailers and restaurateurs. (There’s an old expression in the construction trades: “retail follows rooftops”). It’s impossible to keep track of all the new restaurants in town, let alone the impact they have on their surroundings. LuLu California Bistro not only revitalized an important corner downtown, it also created 200 jobs which didn’t exist here before.
Some of this growth is fueled by simple demographics. There are 76 million baby boomers in this country, the first of whom started turning 65 last year. Many are choosing to leave expensive, urban environments for relaxing resort towns like this one. It helps that they’re bringing their newly-accessed 401(k) accounts with them.
But some of the growth is also the result of smart planning by city officials. The expansion of the airport and the convention center came just in time for what we’re experiencing. And the hotel incentive program, pushed by Mayor Steve Pougnet, paved the way for so many cool resorts that London’s Guardian Newspaper last week called Palm Springs “the Hamptons of the West Coast.”
And then there’s Measure J, passed by the voters last November. Its overwhelming passage makes this the only city around to update its infrastructure. And the real untold story about Measure J is that it will probably generate much more money for the city than even its backers predicted. Measure J’s one-cent sales tax increase is supposed to generate $8 million per year for the next 25 years. But that’s a conservative model that doesn’t account for inflation (costs of items we buy will go up over 25 years, so the tax money generated will go up). And even the $8 million dollar figure may already be out of date. Last year alone, Palm Springs took-in $9.6 million in sales tax money. Nor does the model account for the downtown Wessman redevelopment project being a success, which will generate even more tax money. In fact, some City Hall sources think that instead of the $200 million that Measure J was predicted to generate, the figure may be closer to $300 million over the course of it’s life.
All of this means if you feel like the city is on a roll, you’re right, it is. And since success breeds success, the upward trend we’re seeing may be just the beginning.