rv 2014: tod market dreams + reality by john breitinger

25
Development Scenario Workshop Corridor Wide Infrastructure Recommenda3ons to Accelerate Private Investment Summary Hosted by: FOR:

Upload: railvolution

Post on 07-Jul-2015

104 views

Category:

Real Estate


0 download

DESCRIPTION

TOD Market Dreams + Realities The station is in, the riders are coming and the development has been proposed. Now everybody wants retail. But is there a market for it? Will it be supported? Or would other uses be more appropriate and generate additional riders? Everyone expects TOD to generate a mix of uses -- to create a 24/7 environment at every station. How do market realities change that equation? Learn what it takes to support that mixed-use environment that everyone expects; how to assess the market and what residents really want; and how to manage expectations if the market doesn't deliver. Moderator: William M. Velasco, Chair of Board TOD Committee, DART, Dallas, Texas Christine Maguire, AICP, EDFP, Senior Manager, Development Planning and Finance Group, Austin, Texas Anne B. Ricker, Principal/Owner, Ricker Cunningham, Centennial, Colorado John Breitinger, Vice President, Investment and Development, United Properties, Bloomington, Minnesota Michael Horsting, AICP, Principal Analyst, Regional Transportation Authority, Chicago, Illinois

TRANSCRIPT

Page 1: RV 2014: TOD Market Dreams + Reality by John Breitinger

 Development  Scenario  Workshop  

 Corridor  Wide  Infrastructure  

Recommenda3ons  to  Accelerate  Private  Investment  Summary  

       

Hosted by: FOR:

Page 2: RV 2014: TOD Market Dreams + Reality by John Breitinger

Development  Scenario  Workshop    

Page 3: RV 2014: TOD Market Dreams + Reality by John Breitinger

Development  Scenario  Workshop    

Data  Support  Provided  by:  • Cushman  Wakefield/Northmarq  • Marque@e  Advisors    

Page 4: RV 2014: TOD Market Dreams + Reality by John Breitinger

Targeted  Infrastructure  and  Development  

public policy + infrastructure investments

Targeting Priority Development Areas

State, regional, local policies and $$

• Met Council • Utilities • Water Districts • Counties • Municipalities

Page 5: RV 2014: TOD Market Dreams + Reality by John Breitinger

Purpose  Southwest LRT Corridor Community Works and ULI Minnesota engaged an independent panel of local and national developers, economists, and designers to work with the Technical Implementation Committee and provide corridor and station recommendations with a particular focus on five key SW LRT Corridor station areas:

–  Penn

–  Beltline

–  Blake

–  Golden Triangle

–  Mitchell Road

The intended outcome is to identify key development opportunities, barriers and

strengths related to land use and station location, and identify critical infrastructure improvements for consideration by the Cities and SW Project Office linking land use and engineering with

market knowledge.  

Page 6: RV 2014: TOD Market Dreams + Reality by John Breitinger
Page 7: RV 2014: TOD Market Dreams + Reality by John Breitinger

0%

5%

10%

15%

20%

25%

30%

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Timing  Disconnect  Between  Transit  and  Developer  Decisions  

Year  

Land

 price  prem

ium  

Transit  Infrastructure  Timeline  

Private  Land  Development  

Hypothe3cal  Land  Price  Impact  

Construc)on  Final  Design  Preliminary  Engineering  

Alterna)ves  Analysis  

Preliminary  Poli)cs   Opera)on  

Source:  Emerson,  Donald;  “Successfully  Naviga3ng  the  FTA  New  Starts  Process”;  PB  Consul3ng,  2006  

Coordinate  District  Infrastructure  

Page 8: RV 2014: TOD Market Dreams + Reality by John Breitinger

TOP  TEN  TOD  STRATEGIES  

Page 9: RV 2014: TOD Market Dreams + Reality by John Breitinger

1.   IdenNfy  specific  corridor-­‐wide  targets  for  both  community  benefits  and  economic  development  

 

Artsit’s  Studios  Workforce  Housing  Belmar,  CO   TOD  3.0  Strategies  

Page 10: RV 2014: TOD Market Dreams + Reality by John Breitinger

TOD  3.0  Strategies  

2.   Incorporate  market  and  development  criteria    

Page 11: RV 2014: TOD Market Dreams + Reality by John Breitinger

Cost  Assump3ons  Construction HARD Cost Estimates for SW Corridor

Pat John Stacie

Site Work Site Prep/Demo/Landscaping $6.00 6 4 psf Assumes structures on site and includes removal of surface parking

Parking Surface Parking $3,000.00 3500 2500 3000 psf incl. landscape and lighting

Structured Parking $16,666.67 12500 17500 20000 psf Structured parking

Below Grade Parking $23,333.33 27500 25000 17500 psf

Retail

Concrete Podium Construction $102.50 100 105 psf

Masonry (CMU) Construction $75.00 90 60 psf Standard retail strip center, dependent upon size

Steel Frame Construction $60.00 60

Storefront $1,050.00 1050 plf

Retail Tenant Fit-Out $85.00 85 psf Depends on end user. Restaurants can have significant higher costs

Office

Multistory Concrete Construction $110.00 110 psf

Steel Frame Construction $105.00 105

Office Tenant Fit-Out $50.00 40 60 psf Depends on end user. Medical office can have significant higher costs

Residential

Single Family Wood Frame Construction $ 60.00 psf Will's best guess

Townhouse Wood Frame Construction $ 80.00 psf Will's best guess

Multifamily Wood Frame Construction $120.00 105 135 psf Includes const profit. overhead, city fees, etc.

Multifamily Concrete Construction $138.00 psf

Industrial

Concrete Tilt-up Construction $45.00 45 psf

Masonry (CMU) Construction $50.00 50 psf

Page 12: RV 2014: TOD Market Dreams + Reality by John Breitinger

Rent  Assump3ons  Rent and Vacancy Estimates for SW Corridor

Premium Mitchell Golden Triangle Blake Beltline Penn

Residential Vacancy Rate 2.3% 2.3% 3.2% 2.0% 1.9% Vacancy Rate 10% 2.3% 2.3% 3.2% 2.0% 1.9% Average Size 1,016 1,021 944 902 698 $/SF (month) $1.11 $1.10 $1.04 $1.32 $1.49 $/SF (month) 50% $1.66 $1.65 $1.56 $1.98 $2.23

Office Vacancy % 2.61% 17.81% 21.37% 7.83% 12.29% Vacancy % 10% 2.6% 10.0% 10.0% 7.8% 10.0% Ave Net Rent (yr) $12.83 $12.84 $10.56 $13.09 $12.18 Ave Net Rent (month) $1.07 $1.07 $0.88 $1.09 $1.02 Ave Net Rent (month) 50.0% $1.60 $1.61 $1.32 $1.64 $1.52

Retail Vacancy % 1.97% 6.45% 7.97% 7.38% 18.40% Vacancy % 10% 2.0% 6.5% 8.0% 7.4% 10.0% Ave Net Rent (yr) $19.67 $17.87 $12.45 $16.45 $13.76 Ave Net Rent (month) $1.64 $1.49 $1.04 $1.37 $1.15 Ave Net Rent (month) 50.0% $2.46 $2.23 $1.56 $2.06 $1.72

Page 13: RV 2014: TOD Market Dreams + Reality by John Breitinger

Project  Feasibility  Analysis  Building  Type   ConstrucNon  

Type   Podium   Parking   Mitchell   Golden  Triangle   Blake   Beltline   Penn  

RESIDENTIAL  Low  Density   Wood   No   Surface  

1   1   1   1   1  

Medium  Density   Wood   No   Structure  0   0   0   1   1  

High  Density   Concrete   No   Below  Grade  

0   0   0   0   1  MIXED-­‐USE  

Medium  Density  -­‐  ResidenNal   Wood   Yes   Structure  

0   0   0   0   1  

High  Density  -­‐  ResidenNal   Concrete   Yes   Below  

Grade  0   0   0   0   0  

MIXED-­‐USE  OFFICE  Medium   Wood   Yes   Structure  

1   1   0   1   1  

High   Concrete   No   Below  Grade  

0   0   0   0   0  OFFICE  

Low   Cinder  block   No   Surface  1   1   1   1   1  

Medium   Concrete   No   Structure  1   1   0   1   1  

High   Steel   No   Below  Grade  

1   1   0   1   1  

Page 14: RV 2014: TOD Market Dreams + Reality by John Breitinger

3.   Extend  mobility,  access,  connecNons  to  place  

Hop  ShuRle  -­‐  Boulder,  CO  

TOD  3.0  Strategies  

Page 15: RV 2014: TOD Market Dreams + Reality by John Breitinger

4.   Derive  the  staNon  influence  area  and  specific  boundaries  

 

TOD  3.0  Strategies  

Page 16: RV 2014: TOD Market Dreams + Reality by John Breitinger

5.   Enable  market  metrics  to  shape  staNon  area  land  uses  

 

Mid-­‐rise  office  –  Woburn,  MA  Freight  Project  –  Denver,  CO  

TOD  3.0  Strategies  

Page 17: RV 2014: TOD Market Dreams + Reality by John Breitinger

6.   Street  designs,  pedestrian  networks  and  open  spaces  =  transit  infrastructure  

 

Alameda Ave Lakewood, CO

CASE STUDY: Creating an Urban Boulevard – Alameda Ave.

TOD  3.0  Strategies  

Page 18: RV 2014: TOD Market Dreams + Reality by John Breitinger

CASE STUDY: Creating an Urban Boulevard – Alameda Ave.

Alameda Ave Lakewood, CO

TOD  3.0  Strategies  

Page 19: RV 2014: TOD Market Dreams + Reality by John Breitinger

CASE STUDY: Creating an Urban Boulevard – Alameda Ave.

Alameda Ave Lakewood, CO

TOD  3.0  Strategies  

Page 20: RV 2014: TOD Market Dreams + Reality by John Breitinger

CASE STUDY: Creating an Urban Boulevard – Alameda Ave.

Alameda Ave Lakewood, CO

TOD  3.0  Strategies  

Page 21: RV 2014: TOD Market Dreams + Reality by John Breitinger

7.   Avoid  over  planning  specific  development  design  

 

MIXED  USE  OFFICE  RESIDENTIAL  INDUSTRIAL    

TOD  3.0  Strategies  

Page 22: RV 2014: TOD Market Dreams + Reality by John Breitinger

8.   Phase  incremental  infrastructure  improvements    

Industrial/Residen3al  –  Boulder,  CO  

TOD  3.0  Strategies  

Page 23: RV 2014: TOD Market Dreams + Reality by John Breitinger

9.   Emphasize  shared  parking  faciliNes  

15th  and  Pearl  Parking  Garage  Boulder,  CO    

TOD  3.0  Strategies  

Page 24: RV 2014: TOD Market Dreams + Reality by John Breitinger

10.  Create  a  long-­‐term  district  organizaNon/organizer    

Federal

Major  Employers

TOD  3.0  Strategies  

Small Businesses

State

District  Coordinator  

Local/County Governments  

METC

Real Estate Developers Investors

Metro Transit

Page 25: RV 2014: TOD Market Dreams + Reality by John Breitinger

For  Discussion  

•  Process  for  Metro  Transit  to  provide  opera3ng  and  capital  cost  data  for  alterna3ves  early  in  the  PE  process;  

 •  Ability  to  assemble  land  for  cataly3c  projects  and  workforce  

housing;  

•  Legisla3ve  enabling  language  to  fund  infrastructure  

•  Coordina3ng  en3ty  to  focus  on  system  wide  infrastructure  and  placemaking