One of the factors that most heavily affect the Gainesville commercial real estate market is local population growth. With the University of Florida, Shands, and all other job stimulators within Alachua County, the potential for population growth in Gainesville is greatly supported. Greater population can attract more business, especially to the Gainesville Regional Airport - it can lead to more jobs, lower property taxes and help stimulate the local Gainesville economy.
By Anthony Clark | The Gainesville Sun
The key to Gainesville's fortunes will be for the population to grow faster than projected over the next 30 years, according to economist David Denslow.
Denslow, research economist at the University of Florida Bureau of Economic and Business Research and recently retired UF professor, presented his economic forecast at the Gainesville Area Chamber of Commerce's Summer Lunch Series on Thursday with about 120 people in attendance at the Best Western Gateway Grand.
The Gainesville Metropolitan Statistical Area — consisting of Alachua and Gilchrist counties — is forecast to grow about 1 percent a year over 30 years, putting it in the range of 350,000 to 360,000 people, he said.
What is desirable and feasible, he said, would be annual growth of 2 to 2.3 percent to double the population to 500,000 to 600,000 people by 2042.
Such growth beyond projections would not be unprecedented. Denslow showed several examples in which the bureau underestimated the population in fast-growing counties.
He said he favors faster growth to help keep UF a world-class institution and to create better opportunities for the low-income population, particularly in Gainesville and eastern Alachua County.
UF faces a future of continued weak funding from the state while the federal budget is on an unsustainable path with its spending obligations, he said.
"The blow to federal financing of the university system could be pretty severe," he said.
That leaves tuition increases. Denslow said a $4,000-a-year tuition increase, after factoring in scholarships, could inject $80 million a year into the university.
larger Gainesville population would help UF be world class in 2042 because it would draw more airport service, more jobs for trailing spouses and more businesses to partner with on research where government support is lost, he said.
A larger population also creates what Denslow called feedback effects. The Gainesville Regional Airport competes with Jacksonville, Tampa and Orlando, but more people brings more flights, more destinations and more low-cost carriers, which draws more businesses, which leads to more air service.
Joking that he was avoiding controversy by describing a hypothetical situation, Denslow said the rate impact of the biomass plant would be smaller when spread to more people, which would make the area more attractive to businesses.
The same goes for property taxes: with so much government property off of the tax rolls, more owners would share the burden, he said.
In addressing environmental concerns about growth, Denslow said the area could keep its trails and other outdoor amenities through methods such as more dense development. Maintaining the quality of life makes the area more attractive for "high-value job development."