About Corona
INTRODUCTION
Corona is the gateway through which economic forces flow from Orange County into the Inland Empire. Over the past two decades, as Orange County has become increasingly overpopulated, the inland migration of families and firms has made Corona a prosperous city. Thus, its $72,162 median income now surpasses Orange County ($70,232) and ranks above six of its eight largest cities. While 2007 was a difficult year in Southern California, the payroll released by firms and agencies in Corona reached a record $3.22 billion and its pay per job was a record $40,804, far above the Inland Empire’s $33,679 average. While Corona’s retail sales slowed in 2007, they were still $3.54 billion, just below the $3.58 billion record of 2006. The city’s industrial market has shown continued strength with a low 4.8% vacancy rate. Corona’s prosperity is also seen in its elementary, middle and high schools, with students above California’s averages on the Academic Performance Index. Also, Corona’s crime rate remains one of the state’s lowest. Southern California’s housing downturn has impacted two aspects of Corona’s economy. Its home prices have dropped back to the 2004 level that preceded their considerable increase. However, with affordability increasing, seasonally adjusted home sales jumped 21% from fourth quarter 2007 to first quarter 2008. Meanwhile, Corona’s office market, which had benefited from the inland migration of residential construction, escrow, title, and insurance firms, has paralleled that of Orange County, with the vacancy rate jumping as these firms have had to cut back. Looking ahead, Corona still has the three ingredients that have been its basic strength:
- Location: Because the community is adjacent to Orange County and acting very much like one of its prosperous communities.
- Timing: Because in the next housing cycle, the inland flow of people and office firms will bring economic activity, given the city’s lower costs versus Orange County.
- Attitude: Because Corona retains its focus on creating a prosperous community with a livable environment and a solid economic base.
DEMOGRAPHICS
Corona has become a booming city when compared to its peers in the Inland Empire as well as many of those to the west in Orange County. In 2006, its median household income reached $72,162, above Orange County ($70,232) and well above Riverside County ($53,508). It ranked 6th highest of the Inland Empire’s 48 cities. Of Orange County’s eight cities of over 100,000 people, only Irvine ($84,270) and Huntington Beach ($75,896) had higher incomes. Its total personal income of $4.0 billion ranked third among inland cities after Riverside ($6.3 billion) and Rancho Cucamonga ($4.5 billion), but ahead of Fontana ($3.1 billion). All three have much larger populations. A significant 32.7% of Corona’s families earned $100,000 or more, just below Orange County’s 33.1% and far above Riverside County’s 20.6%.
Corona’s educational levels are benefiting from local efforts and the migration of upscale families from Orange County. In 2006, the share of its population aged 25 and over with at least a Bachelor’s degree was 23.2%, placing it above Riverside (18.9%) and San Bernardino (17.4%) counties and just below Los Angeles County (27.7%). However, it was still well below San Diego (33.3%) and Orange (34.8%) counties. The share of Corona’s adults who completed their formal educations at the high school level was 46%. That was below Los Angeles (48%), Riverside (50.9%) and San Bernardino (52.1%) counties, though above Orange (36.9%) and San Diego (36.3%) counties.
HOUSING
Corona’s home prices have reflected the forces impacting the Inland Empire’s housing market for two decades. From the mid-1990s until late 2003, prices rose rapidly as Southern California’s housing demand outstripped supply with few areas other than the Inland Empire offering new tracts.
By coastal county standards, Corona’s housing markets remain a bargain. Compared to coastal counties, its $387,000 existing home median price was $188,000 below Orange ($575,000), $78,000 below San Diego ($465,000) and $45,500 below Los Angeles ($432,500). Its $490,000 new home price was $37,250 below Orange ($527,250) and $30,000 below San Diego ($520,000) counties, but $30,000 above Los Angeles ($460,000). Looking at other measures, in 2008, 3.6% of Corona’s dwellings of all kinds were vacant, the second lowest of major inland cities to Rancho Cucamonga (3%). Corona’s population density is modest with 3.35 people per occupied dwelling in 2008 in the mid-range among the major inland cities, where Fontana led (3.97) and Murrieta was the lowest (3.05). In terms of housing turnover, 12.1% of Corona’s existing homes were sold in 2007, down from 17.7% in 2006, but still the highest major inland city above Temecula (8.2%). In 2007, developers retained their interest in Corona with 617 single family housing permits issued, 6.3% of those in Riverside County.
EMPLOYMENT
From 2000-2007, employment within firms and agencies located in Corona went from 53,938 to 79,030, up 25,092 jobs (46.5%). The city’s peak was at 80,681 jobs in 2006, with 2007’s small decline brought on by the inland area’s housing difficulties. As one would expect, Corona’s payroll growth has been aggressive, as has its job growth. In 2000, the city’s payrolls totaled $1.66 billion. By 2007, they nearly doubled to a record $3.23 billion, up $1.56 billion (94.2%). Adjusting for a 26.7% increase in Southern California’s consumer prices, the payroll’s purchasing power still grew $1.12 billion (67.5%). At $824.8 million, construction had the city’s largest 2007 payroll, followed by manufacturing ($683 million), distribution ($429.4 million) and retail trade ($291.3 million). From 2000-2007, Corona’s $491.7 million gain in construction payroll ranked ahead of the $253.5 million growth in manufacturing payroll and the $233.1 million increase in distribution. Importantly, the city saw a tripling of payroll in the small but high-paying engineering & management sectors and a doubling of payroll in its small aerospace sector.
Meanwhile, Corona’s evolving employment base is benefiting from the fact that the Inland Empire has attracted numerous executives, professionals and technology workers because coastal county prices for upscale homes remain beyond the reach of younger, well-educated families who want a high-end lifestyle. As a result, from 2000-2006, the area added 129,234 residents with Bachelor’s or higher degrees (up 41.4%). By 2006, 30.1% of Corona’s workers were managers or professionals, just under Los Angeles County’s 32.9%. When office firms move inland, they often find many of their own workers already living in the area. They can also often compete for their coastal competitor’s best workers since they live inland and want to stop commuting.
TAXABLE RETAIL TRADE
In 2007, Corona’s retail sales were $3.54 billion. This was down slightly from $3.58 billion in 2006, due to the current difficulties in the housing market. Corona’s sales have consistently out-performed Riverside County, except during the recessions of 1992 and 2002. In 2005, the city’s growth was 15% versus the county’s 12%. It was 7% versus 6% in 2006. In the 2007 downturn, the city’s sales dropped –1.1% to the county’s –1.4%. California was up 0.2%. Corona’s 2007 sales of $3.5 billion ranked third among the 48 Inland Empire cities after Ontario ($5.6 billion) and Riverside ($4.9 billion). Interestingly, its sales ranked below just three of Orange County’s cities: Anaheim ($5.8 billion), Irvine ($5 billion) and Costa Mesa ($4.1 billion). Given the importance of the retail sales tax to California municipalities, taxable retail sales per capita is a good barometer of a community’s ability to provide services to its population. Corona fares very well by this standard. In 2007, its per capita sales reached $24,099 to rank eighth in the Inland Empire. Compared to major inland retail cities, it was below Montclair ($32,885), Ontario ($32,128), Palm Desert ($31,468) and Temecula ($26,114). Of Orange County’s large cities, it exceeded Orange ($22,695) and Anaheim ($16,842), but was below Costa Mesa ($35,804) and Irvine ($24,134). From 2000-2007, Corona’s sales per capita rose by $10,499 (77.2%). In this period, Riverside County only grew $3,389 (21.3%). Thus in 2007, the city’s per capita sales were $9,879 higher (69.5%) than the countywide average of $14,220.
It’s important to note that the 2000-2007 growth of Corona’s total sales (104.3%) and per capita sales (77.2%) far exceeded the 26.7% gain in prices. This means that the physical volume of underlying goods being traded has risen dramatically, and has the purchasing power of retail sales taxes collected.
An elementary sales gap analysis found that, in 2007, Corona’s $24,099 per capita retail sales were well above the averages for Riverside ($19,178) and San Bernardino counties ($20,509). Corona was found to be receiving an influx of money from surrounding communities in several sectors, with the strongest advantages in non-retail outlets due to its many manufacturers and distributors, building materials and the automotive group. The only evident disadvantages were in the area of specialty retailers and food stores. Previous outflows in general merchandise, apparel and restaurant sectors have been either closed or nearly eliminated due to retail centers like The Crossings and the upscale Dos Lagos. This will lead to continued dominance for Corona in the Taxable Retail Sector for years to come.
INDUSTRIAL REAL ESTATE
Industrial firms have been coming to Corona for years, in part due to its proximity to Orange County. The city has also offered modern facilities at reasonable lease rates, and its labor costs are competitive. In addition, firms located in the city have uncongested access to transportation centers including LA-Ontario International Airport (ONT) with its huge UPS hub and direct flights to China. Soon, UPS will also handle DHL’s air cargo. Along with positive geographic factors, firms considering Corona will find a community with policies and procedures designed to increase the efficiency with which businesses interact with the municipal government. Their success is seen by the fact that successful firms, like Fender Guitar and Watson Pharmaceutical, have elected to remain in Corona and others, such as Robertson’s Ready Mix, have chosen to transfer their headquarters to the city. In June 2008 Grubb & Ellis reported that Corona has 26.2 million sq. ft. of industrial space (25.7 million complete; 417,000 under construction), or 6.1% of the 430.2 million sq. ft. in the Inland Empire. As stated, Corona’s space is unusual in its orientation to manufacturing, not just distribution. That is seen in its composition. When construction is completed, medium-sized facilities (25,000-99,999 sq. ft.) used by manufacturers and smaller distributors will be 42.7%. Smaller spaces (5,000-24,999 sq. ft.), often purchased by smaller manufacturers, entrepreneurs or office operations, will be 25.2%.
In June 2008 Corona had 2.4 million sq. ft. of space either vacant, becoming available or under construction but not leased. Only two major inland markets had less available space: Rancho Cucamonga (2.4 million sq. ft.) and Chino (2.1 million sq. ft.). That represents 9.3% of its space, equal to Ontario and well below the Inland average of 13.4%. Among major markets, only Rancho Cucamonga (6.6%) and Chino (5.4%) were below it. Office Real Estate Corona has become a major player in the Inland Empire’s office market. Prior to 2003, this market was nearly dormant. In fact, its vacancy rate was over 20% as recently as 1999. In 2003, net absorption leapt to nearly 1.2 million sq. ft. as the inland region’s large and growing population and economy began forcing office firms to migrate inland to compete for business. In 2004, absorption slowed a little due to lack of space as the vacancy rate dropped to 7%, third lowest in the U.S. In 2005-2006, the completion of new projects allowed absorption to reach nearly 2 million sq. ft. with vacancies remaining at 7%. That spurt was due, in part, to numerous housing related firms moving to Corona to handle the fact that 54% of Southern California’s new home sales were in the Inland Empire.
In June 2008 Grubb & Ellis reported that, when construction projects are completed, the Inland Empire will have 27.2 million sq. ft. of office space, 7% of Southern California’s total. Corona ranked 5th of 20 inland city markets with 2.25 million sq. ft., an 8.3% share. It ranked after Riverside (6.05 million sq. ft.; 22.4%), Ontario (4.28 million sq. ft.; 15.8%), San Bernardino (3.74 million sq. ft.; 13.8%) and Rancho Cucamonga (3.57 million sq. ft.; 13.2%).
Riverside-Corona’s average asking office lease rate for Class A space was $2.42 per sq. ft. a month in June 2008. The least costly Orange County space was $2.65 per sq. ft. in its western area. In the nearby San Gabriel Valley, the rate was $2.74 per sq. ft. Of the Inland Empire’s 20 city markets, Corona’s $2.06 per sq. ft. a month blended asking rate for all office space ranked third, just above Ontario ($2.04 per sq. ft./mo.). Other major markets included Rancho Cucamonga ($1.79 sq. ft./mo.), Riverside ($1.69 sq. ft./mo.) and San Bernardino ($1.51 sq. ft./mo.). Another factor positively impacting Corona’s long term office market is the short distance to LA-Ontario International Airport. That facility ranks second only to LAX in passengers and is a compelling alternative for business travelers wishing to avoid congestion there. Meanwhile, firms located in Corona are within easy reach of the researchers, interns and graduates of 16 four-year colleges. This includes major scientific schools like Harvey Mudd College, Cal Poly Pomona, Loma Linda University Medical Center and University of California Riverside to name only a few. Quality of Life.
Corona’s increasing prosperity has given it the wherewithal to devote an increasing amount of community resources to education, parks and law enforcement. The results have been significant. The community’s students are performing well, its citizens enjoy a substantial number and variety of parks, and the city is a very safe place to live.
Corona’s young people attend classes in the Corona-Norco Unified School District, the largest in Riverside County with 53,650 pupils in October 2009. Looking at performance measures, the Corona-Norco schools have performed well. On the Academic Performance Index used to measure overall school performance, their students have improved nearly every year from 1999-2007. In 2007, they scored above the state’s averages at the elementary (806 vs. 761), middle school (743 vs. 720), and high school (718 vs. 689) levels.
Looking at recreation opportunities, Corona has 37 parks covering 346.6 acres, or one acre of park land for every 425 residents. That is fewer people per park acre than the Inland Empire’s major cities, except Riverside and Temecula. Designated “Tree City USA” by the National Arbor Day Foundation, the system includes urban forests, regional and sports facilities, and neighborhood parks.
Corona is one of the Inland Empire’s safest major cities. From 1993-2007, the U.S. Department of Justice reports that city crime per 1,000 residents fell by 58.2% to just 29.9 incidents. In this period, the number of reported crimes fell by 2,110 (–32.5%) even though the city’s population grew by 54,638 people (59.3%). In 2007, the rate was down –0.7% after dropping –9.1% and –1.8% in 2005 and 2006.
SUMMARY
Corona’s location adjacent to Orange County offers it the unique opportunity to serve as the gateway to the Inland Empire. The City’s pro-business attitude, together with close attention to economic development policies, have recently made it one of Southern California’s more prosperous communities. As indicated above, its median income now surpasses Orange County’s and ranks above six of that area’s eight largest cities. The payroll released by firms and agencies in Corona is at a record level, as is the city’s average pay per job. Corona’s industrial market has shown continued strength with an unusually low vacancy rate. Its elementary, middle and high school students have consistently been testing above California’s averages on the Academic Performance Index. And, the city’s crime rate remains one of the state’s lowest. Looking at long term sustainability, the competitive advantages that have caused Corona to become a prosperous city and made the Inland Empire one of America’s most dynamic economies continue to exist. Southern California continues to add people. This future growth, coupled with a strong and vibrant local economy, should give Corona a sustainable competitive advantage over others in the region for years to come. With a community as unique and geographically advantaged as Corona, clearly the best is yet to come.