Sierra Vista Economic Outlook2013

National Economy Sequestration Sequestration Sequestration Sequestration Sequestration Sequestration Sequestration

Arizona Economy

Local EconomySierra Vista & Cochise County

Retail Sales GrowthInflation adjusted; compared to same month previous year

Retail SalesCochise County Sierra Vista

2013* 6.4% 4.5%

2012 4.5% -1.0%

2011 -1.2% -5.5%

2010 -4.8% -1.1%

2009 -4.2% -1.4%

2008 -6.5% -6.6%

2007 -1.3% 2.6%

Inflation-adjusted to CPI-U* January only; comparison to same period the previous year

Restaurant and Bar Sales GrowthInflation adjusted; compared to same month previous year

Restaurant and Bar SalesCochise County Sierra Vista

2013* -6.7% -14.6%

2012 -4.4% -9.5%

2011 -0.2% 2.8%

2010 0.0% 3.1%

2009 0.3% 2.1%

2008 0.2% -2.0%

2007 0.1% 2.9%

Inflation-adjusted to CPI-U* January only; comparison to same period the previous year

Accommodation Sales GrowthInflation adjusted; compared to same month previous year

Accommodation SalesCochise County Sierra Vista

2013* -22.4% -40.2%

2012 -17.2% -28.2%

2011 -13.1% -10.1%

2010 8.3% 11.0%

2009 -9.0% -2.0%

2008 1.0% 19.4%

2007 19.7% 21.1%

Inflation-adjusted to CPI-U* January only; comparison to same period the previous year

Sales Outlook Retail on rebound but sequestration & general

defense cuts threaten to derail Hospitality will continue to struggle,

particularly accommodation Construction of new hospital will help all

industries (net effect = new hospital – defense cuts)

Unemployment

* Jan-Feb only; seasonally adjusted

Unemployment (Monthly)

Nonfarm Job Growth (Cochise County)Compared to same month previous year

Job Gains/Losses (Cochise County)12 months ended Feb 2013

Job Gains/Losses % (Cochise County)12 months ended Feb 2013

Employment Outlook Net effect = new hospital – defense cuts Net effect = new hospital – defense cuts Net effect = new hospital – defense cuts Net effect = new hospital – defense cuts Net effect = new hospital – defense cuts Net effect = new hospital – defense cuts

New Residential ConstructionSFR Permits

Home SalesMLS (site-built only)

Home PricesMedian Price (site-built only)

New Commercial Construction

Outlook New residential construction stalled due to

competition from foreclosures Existing home sales volume given boost from

foreclosures/lower prices New hospital

Conclusion National economy hampered by fiscal

woes/sequestration State economy improving Local Economy

Sequestration/defense budget cuts New hospital Net effect