Due primarily to challenging economic conditions which show little sign of a long-term turnaround, New Mexico’s population growth has stagnated:
Of course, developers tend to build when either 1) market forces support it (see the recent discussion of Denver for details) or 2) when politicians subsidize it. While no one wants to see growth in New Mexico as badly as we do at the Rio Grande Foundation, merely developing new land and building new buildings will NOT spur economic growth. It may shift growth and, worse, cannibalize revenue from existing business and taxpayers, thus doing harm to the economy.
This is true for BOTH Mayor Berry’s efforts to get the City’s Tallest Skyscraper built and the use of tax subsidies known as TIDD’s for the Santolina development. If tall building in downtown Albuquerque made business sense, someone would be building it already. Instead, downtown continues to have a higher vacancy rate than is found in the rest of economically-struggling Albuquerque. What will ultimately happen to this odd scheme as Mayor Berry leaves office? How much will taxpayers be on the hook for? We don’t know, but the assertion made in the article that having a taller building would “attract more tourists to downtown” made me laugh out loud.
And then there is the Santolina development. Unlike downtown skyscrapers in sprawling Western cities, big suburban developments tend be economically-viable. So, again, why are County leaders throwing $500 million in tax subsidies at it? After all, if New Mexico were growing, developers would be lining up to bring new development. Former New Mexico Sen. Steve Fischmann (a Democrat from Las Cruces) explains how this could be nothing more than a big corporate giveaway in today’s Albuquerque Journal.