The growth of Colorado companies working in space is driving a growing need for ground space to support operations hundreds of miles above Earth.
Colorado is second only to California in the size of its aerospace industry, and realtors are working with companies looking for new buildings to make room as they expand.
“There’s a lot going on with aerospace and it’s not going to stop,” said Matt Harbert, vice president of Raise Commercial Real Estate.
About 23% of Herbert’s current work involves the aerospace industry, according to an analysis by Raise. Colorado has been home to some of the biggest, well-known aerospace companies for some time, but Herbert said the “startup ecosystem” is driving industry expansion in the state.
“We’re seeing an incredible amount of startups that we didn’t see five or seven years ago. They start here or leave California,” Herbert said.
At least three aerospace companies recently moved into new spaces of 100,000 square feet and more, Herbert said.
A report by the Metro Denver Economic Development Corporation and the Colorado Space Coalition says there are 290 aerospace companies in Colorado and more than 500 companies that provide space-related products and services. The analysis indicates that employment in the sector increased by 11.2% from 2019 to 2020 in the Denver Nine-County Area and Northern Colorado and increased by 30.1% from 2015 to 2020.
Colorado has the highest concentration of private aerospace employees in the nation, according to the report. In 2020, 33,460 people were directly employed by the aerospace industry. Metro Denver EDC analysis indicated that 62,270 private and military aerospace workers support an additional 170,340 workers in industries statewide, bringing direct and indirect employment to 232,610 workers.
The industry’s “hyper growth” over the past two years began around the onset of the coronavirus pandemic, Frederic de Loizaga, senior vice president of commercial real estate services and investment firm CBRE, told Reuters. Denver.
“Aerospace was one of the strengths of the entire Denver metro area and all the way to Colorado Springs,” de Loizaga said. “From a real estate perspective, it’s great to have the industry here. As a state, we are very fortunate to have the concentration of aerospace companies that we have. »
Colorado’s aerospace sector has been anchored by several large companies, such as Ball Aerospace. Lockheed Martin Space, Northrop Grumman, Raytheon, Sierra Space and United Launch Alliance.
“When you have all these big players, you also attract smaller aerospace users who want to be close to the bigger players,” said de Loizaga, who specializes in working with industry.
Herbert said Colorado has a strong presence in both private and defense aerospace. “These companies want to be around each other for the collaborative piece. They want to be around the startups and the biggest names we have.
Colorado’s strong space economy has been a boon to York Space Systems, which started in Denver in 2012. Dirk Wallinger, CEO and President, said the company was able to tap into “the tremendous amount of talent and capabilities” present in the state.
“We also brought a lot of people to the state because it’s just a great place,” Wallinger said.
York Space, which makes small satellites for government and private customers, recently moved into a 140,000 square foot building at the Denver Tech Center. The company has three other facilities in downtown Denver that total approximately 50,000 square feet. One is a research and development site in the Aerospace Science and Engineering Building at Metropolitan State University in Denver.
Wallinger declined to give specifics, but said York’s workforce had grown 300% year-on-year over the past three years and revenues had risen 250% by one year to the next. The company’s goal is to be able to produce 750 satellites per year by the end of 2023 or earlier.
The types of buildings that aerospace companies need run the gamut, Herbert said. “What’s unique about aerospace is that they typically need both manufacturing buildings, industrial-type buildings, and offices,” he said.
This usually requires a building with high ceilings. One option is to add a mezzanine for the office space.
De Loizaga said some companies need “clean rooms” or a controlled environment to keep dust and other particles out of a manufacturing area. Secured areas are often needed to protect work on defense and national security projects.
The real estate sector is seeing aerospace companies moving into new parts of the Denver and Colorado area.
“Most of the activity was between Colorado Springs and Denver. It was really the aerospace corridor,” said Herbert. “Now what we’re starting to see is the corridor goes further into Boulder. We’ve seen a lot more activity along the US 36 corridor.”