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__________________________________________________________________ MARKET STUDY OFTHE BRIDGES AT SOUTHLAKEA PROPOSED 55 UNIT FAMILY APARTMENT COMPLEXCITY OF ALBANY, DOUGHERTY COUNTY, GEORGIAAS OF JUNE 9, 2007 PREPARED FOR State of Georgia Department of Community Affairs 60 Executive Park South, N.E. Atlanta, Georgia 30329 PREPARED BY: RLJ AND COMPANY 1024 LAKE CHARLES DRIVEROSWELL, GEORGIA 30075 (770) 640-7313 FAX: (770) 640-5251 TABLE OF CONTENTS A. EXECUTIVE SUMMARY 2 B. PROJECT DESCRIPTION 5 C. SITE EVALUATION 11 D. MARKET AREA 17 E. COMMUNITY DEMOGRAPHIC DATA 22 F. PROJECT-SPECIFIC DEMAND ANALYSIS 29 G. COMPARABLE RENTAL ANALYSIS 34 H. INTERVIEWS 68 I. CONCLUSIONS AND RECOMMENDATIONS 68 J. SIGNED STATEMENT REQUIREMENTS 73 ADDENDA Demographics Fair Market Rents Utility Allowance Schedule Income Limits NOTICE It is imperative for the reader of this document to understand the data presented and analyzed herein, the study methodology employed, the role of judgments as distinct form calculations based on a specified methodology, the factors that affect projects, and changes that, over time, may result in an outcome different from that projected. All prospective data (i.e., projections) are subject to changing market and economic conditions and other uncertainties. Hence, the reader must be fully cognizant of the possibility that, as market and economic factors affecting the subject property materialize, they may impact the property in such a way that actual market and financial performance differs from projections. Legal changes – including but not limited to zoning and tax laws and environmental, soil, and wetlands regulations – are also likely to affect real estate performance, and hence value. The purpose of market, economic and financial projections is to provide a supportable and defensible opinion on potential economic returns from the project and also to provide the basis for the projections so that they can be evaluated by the reader in terms of methodology employed, the data analyzed and applied, and the judgments that were made. The projections reported herein have been prepared using information, assumptions, and calculations outlined in this report. Information, other than that provided by the client, is from numerous public and private sources, believed to be reliable, as well as from RLJ & Company. It should be noted that all direct and indirect information supplied by others is assumed to be true and accurate. However, RLJ & Company assumes no responsibility for information supplied by others, although any such information cited is believed to be reliable and correct. RLJ & Company has reviewed the information provided for reasonableness and consistency. Further, the projections reported herein rely on property-specific data provided by the client and/or its agents. Care has been taken by RLJ & Company to present correct factual information in regard to the subject property; nonetheless, the reader is hereby advised to reach his/her own independent conclusions concerning all facts, as no representations are made by RLJ & Company as respects property ownership, property site, zoning conformance, occupancy and lease terms, availability of utilities, soil conditions, flood hazard, environmental problems, or any other matters. The information, finding, conclusions, recommendations and projects presented herein are intended solely for internal use by the client. RLJ & Company is a real estate appraisal and consulting firm whose business activity includes valuations, the analysis of market potential, and analysis and evaluation of projected operating and financial performance. The firm routinely performs assignments for financial institutions, building and development organizations, property owners, and the like. RLJ & Company considers that it is well qualified in these areas; however, it is important to note that evaluating market support and projecting financial results for real estate development is not a precise science. Furthermore, in RLJ & Company’s opinion, the methodology and other procedures employed are valid and accepted methods of evaluating real estate. Finally, RLJ & Company recommends that its clients recognize these limitations inherent in using such projections as are contained herein to make business decisions. EXECUTIVE SUMMARY Project Description And Site Evaluation: Project Name: The Bridges at Southlake Location: Ebony Lane, west of Martin Luther King Jr Drive and east of South Madison Street, City of Albany, Georgia. Project Type: The proposed construction of a 55-unit two-bedroom and three-bedroom family apartment complex. Project Developer: Vantage Partners 2007 GA, LLC. Plan of Operation: The proposed development will be comprised of fifty-five (55): 2-bedroom and 3-bedroom units. This complex is a LIHTC complex, where 100% of the units are utilizing the Low Income Housing Tax Credit (LIHTC) program, Section 42 of the Internal Revenue code. To qualify, the households will have incomes no greater than 30%, 50% or 60% of the area’s median income. 11% of the units will be 30% of median income, 25% of the units will be 50% of median income, and 64% of the units will be 60% of median income. The project will be located on a 3.59± acre tract off of Ebony Lane, west of Martin Luther King Jr. Drive. The estimated project opening is October, 2009. Market Area: After consultation with area real estate professionals and field work, it is determined that the primary market area is defined by the following estimated boundaries: Eastern boundary: Dougherty County Line Western boundary: Lockett Station Road Southern boundary: Dougherty County Line Northern boundary: Dougherty County Line All boundaries can be reached within a 15 minute drive of the subject. The subject will draw a limited number of tenants from the surrounding county just outside of the primary market area, but that number should be minimal. Demographics: Population in the market area has remained relatively stable with an increase of 3.3% since 2000 to 102,436. During the same period, the number of households increased by 5.7% to 38,556. The number of households is expected to increase by 3.1% by the year 2012 to 39,752 and should positively impact the demand for housing. The size of the households is expected to remain the same at 2.5 persons/household. In researching current demographic data for the area, we researched the U.S. Bureau of the Census as well as the Environmental Systems Research Institute information databases. We also conducted interviews with local government officials and property managers. We found the published U.S. Bureau of the Census figures to be holding true, and that the area has not seen any increase in population due to the hurricanes along the U.S. gulf coast during 2005. Demand Analysis: The 2007 Area Median Family Income for LIHTC Compliance is $48,300. Approximately 13,337 households have incomes that are between $6,480 and $33,617 and would qualify for the LIHTC housing units in this proposed project. An estimated 4,833 renter/size-qualified households in the primary market area will qualify for the subject property. Further calculating for draw from the secondary market, a total of 5,558 households will qualify for the subject property. This equates to an overall capture rate for the project of 0.99%. Supply Analysis: The existing multi-family housing stock ranges from 1 year to 44 years in age and is in excellent to poor condition. All of the complexes surveyed in the market were virtually 100% occupied. Proposed rents for the proposed project are competitive with current rents at the surveyed comparable properties. Capture Rate Analysis:
Interviews: In speaking with the Albany Housing Authority, the Albany Planning Department, and most of the apartment complex leasing and management personnel, all agreed that an affordable housing development would be beneficial in this market area, and specifically in the three-bedroom and four-bedroom unit sizes. All of the apartment managers in the area reported near 100% occupancy and stated that vacancies are usually filled immediately from their waiting lists or from walk-ins. All LIHTC property managers that were contacted stated that the units proposed for the subject property are needed in the market and that the subject should not have any problem gaining full occupancy within a short period of time. The City of Albany has displayed the need for the subject project by designating the subject neighborhood as a HUD revitalization area. Conclusions: The analysts that conducted this market study have concluded that the proposed subject property development is viable in the market. The positive attributes include the location of the site as it relates to employment centers, shopping area, ease of access to neighborhood and highway systems throughout the market area, access to excellent schools and recreation facilities. Most comparable LIHTC properties in the market currently have long waiting lists for units. This further supports the viability of the subject development. PROJECT DESCRIPTION The subject site is located south of downtown Albany, just west of Martin Luther King Jr Drive. The subject site is located along Ebony Lane, a two lane residential street that runs west from Martin Luther King Jr. Drive. The proposed development will be located on a 3.59± acre tract. The proposed development will contain fifty-five (55) newly constructed two-bedroom and three-bedroom units in nine two-story buildings. This complex is a proposed LIHTC complex, where 100% of the units are utilizing the Low Income Housing Tax Credit (LIHTC) program, Section 42 of the Internal Revenue code. To qualify, the households will have incomes no greater than 30%, 50% or 60% of the area’s median income. 11% of the units will be 30% of median income, 25% of the units will be 50% of median income, and 64% of the units will be 60% of median income. The project will be located on a 3.59± acre tract off of Ebony Lane, west of Martin Luther King Jr. Drive. The estimated project opening is October, 2009. UNIT MIX & SIZE
Unit Amenities Electric Stove / Oven Frost-Free Refrigerator Dishwasher Mini-blinds Central Air Conditioning Smoke / CO2 Detectors Individual Unit Entry Storage closet Laundry room with Washer/ Dryer Connections Kitchen, & Bath Area – VCT Flooring Living Room, Dining Room, and Bedrooms - Carpet
Laundry Room with 2 washers and 2 dryers Exercise Room with exercise equipment Picnic area Playground Library Management Office in Community Building Computer Center
Four handicap one-story flats Pitched Roofs Brick and vinyl exterior Private entry
Air Conditioning: Central/HVAC: Tenant paid Hot Water: Electric: Tenant paid Cooking: Electric: Tenant paid Cold Water/Sewer: City of Albany Tenant paid Electricity: Georgia Power Tenant paid Trash City of Albany Landlord paid Pest Control Landlord paid Parking: A total of 114 parking spaces will be available for the 55 units, including 4 handicap spaces. The average number of vehicles per household in the market area is 1.5. Therefore, this parking ratio is considered reasonable. Sponsor’s Pro-Forma Rents
*Source: Georgia DCA Utility Allowances, effective 12/1/2006 Reasonability of Sponsor’s Projected Rents Projected rents are below the maximum permitted at the 30% and 50% thresholds, and well below the maximum permitted at the 60% threshold. Direct competition and tenant support for the subject is in the three market rate, ten LIHTC, and one Section 8 properties surveyed. The subject should compete very well in the market based on price, location, modern design and amenities offered. Considering the lack of development activity in the market and the demand for housing that presently exists, it is our opinion that the subject development should be well received by the rental market. Most of the complexes in the immediate area are virtually 100% occupied with waiting lists. A lease-up rate of 9 units per month is considered very reasonable. The overall occupancy at the surveyed subsidized complexes is 99% with most reporting waiting lists. With a strong pre-leasing program prior to construction completion, the subject property should be 90% pre-leased prior to construction completion, and 100% occupied within six months of construction completion. Sponsor’s Projected “Achievable” Restricted LIHTC Rents
Maximum Allowable LIHTC Net Rents (’07), HUD / DCA Fair Market Rent (’07), and the Sponsor’s Projected Opening Rents
Unit Mix:
The subject offers thirty-five (35) two-bedroom unit types and twenty (20) three-bedroom unit types. Considering that the subject units are family-oriented, the mix is considered adequate. All of the units will be set aside for households whose incomes are less than 30%, 50% or 60% of the area median income. The market for all sizes of units is over 99% occupied. There are only four vacancies among the 606 LIHTC two-bedroom units in the market, and nine vacancies among the 445 LIHTC three-bedroom units in the market. Therefore the subject units should be in demand and maintain an excellent occupancy. The subject’s proposed unit mix will meet the needs of family households looking for housing in the community. No floor plans were provided for the subject property. Two-Bedroom Unit Type: Thirty-five of the units are 2-bedroom units. Two of the units are handicap units on the first floor. These units have 2 bathrooms and are 1,103 square feet in size. The remaining units are all 1,248 S.F. in size, have 2.5 baths per unit, and are 2-story townhouse design. The units are superior in size to all of the other comparables in the market. Two-bedroom comparables range in size from 760 to 1,041 S.F. The units are thoughtfully laid out and functional in design. Three-Bedroom Unit Type: Twenty of the units are 3-bedroom units. Two of the units are handicap units on the first floor. These units have 2 bathrooms and are 1,225 square feet in size. The remaining units are all 1,591 S.F. in size, have 2.5 baths per unit, and are 2-story townhouse design. The units are superior in size to all of the other comparables in the market. Three-bedroom comparables range in size from 896 to 1,294 S.F. The units are thoughtfully laid out and functional in design. Utilities: Tenant-paid utilities include electric for lights, air conditioning, plug-in appliances, cooking, heat, and hot water; cold water/sewer. The landlord pays for refuse collection and pest control. At most of the comparable properties, the landlord pays for cold water/sewer and pest control. Considering the rent is competitive with the market and that the subject units are a more desirable in size, the utility structure should not make a difference and the subject should be well received by the rental community. Common Area Amenities: Common area amenities include a playground area, a community room, a picnic area, a laundry room, an exercise room with exercise equipment, and a library/computer area. The management office will also be located in the community building.
Site Plan Configuration: The configuration of the subject’s buildings provides a sense of community rather than a traditional mid-rise apartment complex and is rated very good for appeal. The siting and orientation of the buildings enhances a sense of neighborhood. If many of the existing mature trees on the property will remain in place after construction, it will add to the appeal of the development. SITE EVALUATION The subject site is 3.59± acres in size and is irregular in shape. The site is at street grade with mostly level topography throughout the site. The subject is presently vacant with many mature hardwood trees throughout the site. The subject site is located in an area identified as being inside the 100 year flood plain. There is a small drainage ditch that runs through a section of the property, and the property is located less than ½ mile west of the Albany River. We do not have expertise in this area, therefore we recommend that possible flooding issues should be thoroughly investigated. All utilities are available to the site and include water, sewer, electricity, and communications. The site is bounded on the north by vacant land and a church along West Oakridge Drive; to the east is Martin Luther King Drive; to the west is South Madison Street; and to the south is Ebony Lane then vacant residential land between Ebony Lane and Hickory Lane. The subject neighborhood is made up primarily of single-family residential development, as well as some mixed multi-family and retail uses. Most of the single family residences south of the subject site are in poor condition and many appear to be vacant. The proposed subject development should provide a significant positive impact on the immediate neighborhood. It is also our understanding that the City of Albany has targeted the subject’s Ebony Lane as well as Hickory Lane and Medlock Lane to the south, for revitalization through the HUD-approved NRSA program. Under this program, existing substandard rental housing is being demolished and replaced with healthy, safe affordable housing units. The subject site has limited visibility, but has access by all the road systems within the Albany area. The site is conveniently located near recreational facilities, primary school, elementary school, middle school, and high school. Shopping, health care, and social services are located within two miles of the site. There are also two full service grocery stores located within one mile of the subject site. The subject site is located along existing Albany Transit Authority bus routes to the east and west. Schools:
Higher Education
Parks and Recreational Facilities
Libraries
Hospitals
Shopping
SUBJECT PHOTOGRAPHS 
SUBJECT SITE 
SUBJECT SITE 
EBONY LANE VIEWED EAST SUBJECT ON LEFT 
EBONY LANE VIEWED WEST SUBJECT ON RIGHT Summary on Overall Project Feasibility Superior size; comparable in-unit amenity package and services; very good unit floor plans overall; common area amenities are comparable to the complexes in the market. The micro-location is an older area of the city with limited development. The subject’s development plan for the property should have a strong positive impact on the overall neighborhood. Access is good. This development should perform very well over the foreseeable future. The complex has an excellent location, and is convenient to all commercial and retail shopping within the Albany market. Major highways and arterial roads are convenient to the subject site. Local bus service is available to the subject site and is operated by the Albany Transit Authority. Directory: housing -> housingdevelopment -> programs -> downloads -> OAHGORAMarketStudies2007 housing -> Romania’s answers to the Questionnaire addressed by the Special Rapporteur on adequate housing as a component of the right to an adequate standard of living, and on the right to non-discrimination in this context housing -> Executive Summary ap-05 Executive Summary 24 cfr 91. 200 housing -> Background Legal/institutional framework housing -> You asked the President! During the spring semester President Núñez visited with the residents in each of the first year residence halls. During those visits you were engaged in great dialogue and asked many excellent questions downloads -> Georgia Department of Community Affairs 60 Executive Park South ne housing -> Basile Baumann Prost Cole & Associates, Inc. Public/Private Development Advisors downloads -> Enterprise Communities Albany Central Savannah River Area Crisp and Dooly Counties OAHGORAMarketStudies2007 -> Market study Download 3.71 Mb. Share with your friends:
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