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Joyce Lowe ABR,CRS,GRI,CNS,SRES, Broker's Blog

By Joyce Lowe ABR,CRS,GRI,CNS | Broker in Federal Way, WA

Joyce's Voice...Surprise! Good economic news popping up in Seattle region.

Joyce's Voice...Surprise! Good economic news popping up in Seattle region.

This is such good news, thought I should pass it on...In a tough 2011, the Puget Sound region continues to make gains that bode well for several industries in the future.

The most dramatic developments involve Boeing. Emirates, the airline headquartered in Dubai, placed an order for 50 777s built in Everett, with an option to purchase 20 more. The entire deal would be worth $26 billion, although such large transactions usually involve discounts.

Days later, Indonesia's Lion Air said it would buy 230 narrowbody 737s for a list price of $21.7 billion. At least for now, these jets are made in Renton and state leaders are working hard to persuade Boeing to build its next-generation 737 in Washington state.

The Amazon.com campus in South Lake Union continues to rise, with the company hiring while most large corporations are just sitting on their cash. CEO Jeff Bezos is willing to incur the fury of short-term Wall Street to build for the long-run.

Despite grim barriers for consumer spending, Nordstrom increased its third-quarter profit by 7 percent, thanks in part to affluent shoppers. It used to be that department stores were hammered during downturns and slow times, but not now.

Costco, which never slowed during the Great Recession, is doing beautifully and is fresh off an election victory to privatize state liquor sales. Comeback star Starbucks is basking in deserved adulation (Howard Schultz is Fortune magazine's Businessperson of the Year). It sports plenty of cash to invest, such as in expanding its Kent roasting and packaging plant.

Meanwhile, the worst fears for Seattle real estate during the recession haven't materialized. While single-family residential struggles in many parts of the metro area, apartment construction is booming, underscored by the recent announcement by a California developer that it intends to break ground on a 31-story First Hill project in the spring of 2012.

The Urban Land Institute's influential Emerging Trends in Real Estate report ranked Seattle sixth nationwide among 51 markets for investment in multifamily and commercial projects next year.

Construction jobs, hard hit by the crash, gained an additional cushion by major public infrastructure that received the final go-ahead in recent months: The deep-bore tunnel in downtown Seattle and the light-rail route through Bellevue.

If common themes emerge, they include that the metropolitan area continues to leverage its corporate, industry cluster and trade touchstones. It keeps attracting talent. And for all the successful reinvention and diversification of recent decades, Boeing still leaves a giant footprint.

Even so, innovation powers Seattle like never before. We ranked No. 5 this year in the Americas and 25th globally in the Innovation Cities Index compiled by the Australian company 2ThinkNow. The survey ranks 331 cities based on a variety of economic and competitiveness measures.

The metro areas ranked ahead — Boston, the Bay Area, New York and Toronto — are much more populous. Seattle is among this elite: "A Nexus city, is a top innovation destination for innovation in multiple sectors of the urban economy," the report reads. "Nexus cities have a high probability from a cluster of preconditions to create innovation not just in science, but in areas such as product, process, business, service, policy and other types of innovation."

Also, Boeing and Microsoft ranked among the world's 100 most innovative companies in a new Thomson Reuters analysis.

I'm not trying to feed you Astro-green shoots. These strengths are present even as statewide unemployment remains at 9 percent, thousands are hurting and continued government cutbacks drag on recovery.

Digging out of the unemployment crisis could take years. It's a tale of two economies, two trajectories, but in the same place.

This dual reality is reflected in the Puget Sound Business Barometer, a survey of 1,700 businesses by the Greater Seattle Chamber and its economic-development partners.

It indicated that several sectors expect to hire: Energy, aerospace and manufacturing, life sciences, information technology and interactive media. Still, government, education and transportation are likely to cut jobs. Small-business owners are the most likely to hire (but, I would add, many also face trouble getting loans).

The report indicates that many companies are stabilizing after the downturn and even growing. The businesses reporting layoffs fell 4 percent compared with 2010. Yet, "employers' perceptions of the overall economy are weak. Of the sectors expecting growth, only some say they will hire. Many others expect higher sales or new contracts but won't hire proportionately."

The Bellevue Chamber of Commerce survey of 700 businesses found that 58 percent expect to add workers in 2012 and 34 percent plan to keep employment at current levels.

Plenty can still go sideways, from Europe's troubles to Boeing moving the next generation 737 production elsewhere. But the year is turning out better for Seattle than many other American metropolitan areas.

By Jon Talton

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