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Seacrest Village/Intown Key Findings & Recommendations: Market Analysis Update.

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Presentation on theme: "Seacrest Village/Intown Key Findings & Recommendations: Market Analysis Update."— Presentation transcript:

1 Seacrest Village/Intown Key Findings & Recommendations: Market Analysis Update

2 Overview ERA Scope of Work Relevant Market Trends Market Potentials & Preliminary Development Program Next Steps – Financial Feasibility & Planning Evaluation/Testing

3 ERA Scope of Work Understand the fundamentalswhat is Boynton Beachs economy today? Identify drivers of demand that support new development Examine real estate market trends & characteristics Test market potentials for a range of useshousing, workplace, supporting retail Measure financial feasibilitydoes redevelopment makes sufficient financial sense? Outline CRA/City responsibilities to induce redevelopment

4 Demographics Palm Beach County Population expanded by 129,000 in 46,000 new HHs since : 1.2 million residents, 515,000 HHs 2012: forecasts suggest 101,000 new residents in 36,000 new HHs (7,200 per year) Population is aging slightly: 44 today, 46 in 2012 Average HH incomes expected to jump from $87,000 to $108,000 next five years Increasingly diverse population

5 Demographics Boynton Beach Boyntons share of County has held steady6.5% : 8,000 new residents in 3,000 HHs (440/year) 2007: 77,800 residents, 34,000 HHs 2012: Pace of growth to increase6,300 new residents in 2,400 HHs (480/year) 2020: 17,300 new residents in 6,600 HHs (500/year) Average HH incomes of $64,000 to rise to $76,000 next five years Strongest growth expected among peak earners, empty nesters

6 Employment Palm Beach County : 53,200 new jobs (7,600/year) 2020 forecast: 114,500 new jobs (8,800/year) Strongest sectors: Services (60%) & FIRE (26%), Construction 33,000 jobs in Boynton Beach6% of County total (fair share)majority in Retail sector Citys share expected to increase; 10,200 new jobs by 2020 Critical barometer of demand for new commercial development

7 Housing Boynton Beach City issues 675 permits/year (avg. since 1997) 50% split between MF & SFD County issues 11,600 permits/year67% SFD Upward pressures on market dynamicsloss of rental units to conversions, declining vacancies, price escalations Median price of SFD: $350,000 (citywide), $222,500 (CRA) Reported 58% increase in rents since 2000: $1,150/month (2005)

8 Housing Comparable Projects Profiled 20 for-sale residential projects along A1A Market activity has slowed substantially in past 18 months Slowdown producing significant excess inventory, conversions to rental, site plan extensions, project cancellations Delayed market recovery could further increase inventory Condominiums: $289-$520K/unit & average monthly absorption of 7 units THs: $221-$337K/unit & average monthly absorption of 3 units

9 Retail Boynton Beach Inventory: 5.7 million SF 13% of County Suggests 74 SF per County residentfar above national average of 26 SF/capita Reflects Citys role as dominant retail destination, importance to tax base Active leasing market789,000 SF absorbed since 2001 Vacancy rate of only 2% Average rents of $17 per SFbelow threshold feasibility for new construction Apparent opportunities: $4.7 million in retail leakage within 1-mile of Seacrest Village site

10 Office Boynton Beach Demand driven by rooftop growth for professional & business services tenants Inventory: 1.8 million SF in 84 buildingsCounty share limited (4%) Class A properties comprise only 17% of inventory Key metric: 63,000 SF average annual absorption compared to 600,000 SF countywide Price-sensitive market: lowest vacancies among Class C stock 10,000 new jobs forecast for the City bodes well for office demand

11 Market Potentials: 10 Years Housing

12 Market Potentials: 2012 Retail Issue of investment-grade retail standards Primary markets: each resident typically supports 3 to 7 SF; each employee supports 2 to 5 SF Each visitor supports 0.5 SF Growth in office & residential generates new retail demand Partial-year residency affects resident-based demand Population growth fueling overall strong demand – dominated by West Boynton

13 Market Potentials: 2012 Retail Significant physical constraints of HOB site (lack of frontage, FEC RR) limit market potentials Theoretical opportunity to stem retail leakage Second-tier grocery store critical to support neighborhood retail program Limited supporting convenience/service tenants will follow Subsidized* Market Potential: 50,000 to 75,000 SF (with grocery store) Without grocery store: 15,000 to 30,000 SF

14 Market Potentials: 2012 Supporting Uses: Professional Office Majority of new office development in Boynton expected in superior locations (e.g., downtown, West Boynton) HOB site is a tertiary office location Limited market for rooftop–serving professional office tenants Public sector tenant could induce the market Market Potential: 5,000 – 20,000 SF

15 Project Schedule Next Steps Financial Feasibility Study (May/June) Planning Evaluation/Testing – will integrate market study, financial feasibility study, and evaluate physical development program on site (June) Work-In-Progress Presentation: June 12

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