If you are like me, then you have recently seen the news about a major destination theme park that’s headed to Delaware County that will be bigger than Disneyland.
If you haven’t seen the news, just google Planet Oasis Ohio and you’ll be deluged with articles talking about the 350-acre sports and entertainment resort that will be located adjacent to the Tanger Outlet Malls off of I71 and US 36/SR 37 exit in Delaware County. After you read it, you may also be wondering, “holy crap, what’s this going to do to real estate values, traffic, and jobs!?!”
I’ve had several clients ask me, so I’ve done some research and made some speculation. I say speculations rather than conclusions because I’m not an expert in traffic or jobs, but I’ll have to speculate on those in order to draw some conclusions on real estate.
From a traffic perspective, one of the first effects that I believe that we’ll see is a rethinking of the I71 and 36/37 project to install a new exit ramp. It’s likely that they’ll need to re-design their current plans to safely accommodate a higher volume of traffic than they had anticipated. My hope is that this will not delay the construction too much because the plans for construction on Planet Oasis are for 45% of the project to be complete by December 2019. I think that they may also need to consider building a third exit to the north of the current exit to 36/37 from I-71 since it’s another 10 miles to the next exit. With all that construction, traffic is bound to stink in the short term. Especially, since it already stinks at rush hour with the current exit ramp configuration.
Jobs will be impacted almost immediately and once construction starts, the project will likely make a huge impact on the local and regional pool of construction labor. This will pull skilled trades workers away from other jobs and create a shortage of workers, which will drive construction costs up significantly for all types of construction while the resort is being built.
As new hotels, restaurants, and entertainment venues come online, the labor shortage will move into other types of workers and likely pull from not only Columbus but the whole state. Of the estimated 15,000 – 25,000 new jobs created, my guess is that 85% of them will be for lower wage or unskilled jobs and the other 15% will account for skilled trades and management. Doing the math, this means around 13,000 employees will be unskilled or lower wage positions and around 2,000 will be skilled trades and management. On the high end, that would make around 21,250 unskilled / lower wage and 3,750 skilled trades and management.
The number of jobs that are being created with this project cannot possibly be satisfied by the local economy. This means 2 things: 1) There will be an increase in wages locally, especially for unskilled types of labor and especially in the short term and 2) There will be a migration of people to Delaware County and the surrounding areas to be close to work.
Now, with that background on my assumptions, we can talk about the real estate.
From a purely macroeconomic perspective and thinking about the law of supply and demand, the migration of people to Delaware County will cause an increase in real estate values and rental rates. Because most of the jobs will be lower paying jobs, I expect that the rental market and homes under $200k will see the most upward movement, though an extra 2,000 – 4,000 families that could purchase a home will certainly drive up all price points.
In the areas immediately surrounding the resort, I would expect to see a lot of new construction of all levels of apartments, condos, and homes for the new workers to live. Since most of the workers may rent instead of purchase a home, the types of housing may be higher density – smaller lots, condos, apartments, taller buildings. This will likely change the character of the area to be more suburban and a whole lot less rural than it is now. Also, these new homes will create a demand for other new retail, restaurants, grocery, etc. that will need to be built, which is not part of the resort, to service these new residents.
Extending out from the area immediately surrounding the resort, I expect to see new construction of homes extending much farther to the north, since that is where the least expensive land is currently. In addition, we’ll see a swelling of Sunbury, a filling in of the land between I71 and Delaware that is not currently developed, and possibly a bustling town of Marengo, just 1 exit to the north on I71. In general, I could see a lot of new building into southern Marion and Morrow counties.
Now, all of that said, what does that really mean for people who own homes in Delaware County? In my opinion, homes near the resort under $200k will appreciate significantly (25-30%), homes $200k – $350k somewhat significantly (15-25%), and homes $350 – $500k somewhat (10-15%), and homes above $500k some (5-10%) in the next 2 years after construction starts. All of those numbers are guesses, so they won’t be accurate, but I think that the pattern will be similar. The farther out from the resort you go, the less impact that there will be.
So, there’s my 2 cents. Whether you love the idea of a resort in our backyard or you hate the idea of a resort in our backyard, I wouldn’t recommend making any major real estate decisions yet. It’s just too early to tell if it will really happen and if it will be of the scale that is discussed in the press releases.
One thing that I can tell you for sure is that if you are even thinking about making a move, give us a call to discuss your specific real estate situation…we can help!
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