(+) Real Estate Advisory*
[REcon S E R V I C E S]
Housing Analysis The fundamental demand driver for all types of housing is employment. The supply side of housing is mostly driven by exiting inventory and the pipeline of development. Various other variables play key roles in determining the balance of broad regions such as Metropolitan Statistical Areas or specific site location and product lines. Our analytical models utilize all the key supply and demand variables including long term trends to provide our clients various. The analysis ranges from site-specific accepted absorption rates to overall determination of market conditions. Site-specific studies offer periodic absorption projections based on product type (single family detached and attached, condominiums, and flats), floor plans, and price ranges. Rental-unit absorption rates are provided based on targeted rental rates which are heavenly dependant on proximities of employment centers.
Retail Analysis Socioeconomic demographics provide the bases of retail demand, while existing supply of establishments with a specific study area determines any residual demand for further development.
Office Analysis : Regional employment factors and relative office supply are the basis dictating potential demand for additional office space. Site specific analysis is supplemented with commercial broker data and field survey of existing office supply. The analysis allows for determination of current or future development opportunities including lease rates and vacancy probabilities. Relevant economic activities associated with demand for office space based employment are the basis of the analysis. Employment activities (gains and losses) are translated into office space (increases and decreases) demand on a regional basis. The projection share of site specific absorption versus regional demand is assigned on the basis immediate supply, location, accessibility, and a wide array of relevant factors. The evaluation of future regional and site specific supply is evaluated based on pipeline supply (i.e. building permit activity). The projected demand is evaluated to the calculated supply to ascertain potential absorption rates, probable tenant types, space requirements, possible vacancy rates, and other related profiles. The analysis assists investors in developing the appropriate office buildings. The statistically-based analysis may also be supplemented with survey of site area office buildings to include includes information pertaining to lease rates, tenant improvement practices, vacancy rates, absorption rates, tenant mix, building classification, building amenities, etc. Information regarding projects under construction and planned for future development are also available. The combination of econometric model and local survey data assists clients in understanding local development/investment opportunities and our recommended approach to capitalize on these opportunities.
Industrial Analysis : Industrial studies are analogous in many respects to our investigation of area office markets. The studies implements highly refined econometric model to calculate industrial vacancy rate and project demand for new industrial facilities. This statistical investigation is typically accompanied by local broker data or a field survey of area industrial facilities conducted by senior staff members. The statistical modeling system serves as the foundation of our industrial analysis. The industrial model projects demand on the basis of increases (decreases) in employment in selected categories of nonagricultural wage and salary employment – principally manufacturing, wholesaling, and contract construction. Changes in the targeted employment categories are converted to demand for industrial space on the basis of typical space use coefficients (per employee) developed. A share of regional demand is assigned to the site area (and specific project) on the basis of location, competition, access, building sizes, etc. The system simulates increase in supply of industrial facilities through industrial building permit data collected from permit issuing agencies within the study area – typically a Metropolitan Statistical Area (MSA). The quantified estimate of supply is then compared to our demand projection to determine the future direction of industrial vacancy rate, the area’s ability to absorb new industrial buildings, and recommended building sizes derived from the size profile of area industrial tenants.
Fiscal Impact Analysis : Fiscal impact studies identify the recurring net annual effect resulting from real estate development on the operating budget of government entities (City/County/State) responsible for providing those public services (police, fire, community services, school districts, library districts, flood control districts, etc.) likely to be demanded by project activities. A specialized form of cost-benefit analysis, fiscal impact studies determine if development and occupancy of real estate pursuant to a proposed project or land use policy represents a net benefit or burden for the operating service structure of the affected agency. Fiscal impact analysis involves a detailed review of the current year operating budget of the affected agency in order to identify relevant operating revenue and expense factors and the fixed and variable costs dictated by the delivery structure of the agency’s service scope. Fiscal impact studies often involve considerable communication with respective representatives of the affected agency to properly identify incremental revenue and cost components. Proper characterization of the agency’s fiscal service structure requires close scrutiny of operating practices not generally disclosed in normal budget reporting detail.
Special Land Use Analysis
We offer a wide range of studies for specialized land uses including:
- Equestrian Center
- Self Storage
- Truck Stop Facilities
- RV/Mobile Home
- Sports Stadiums
- Race Tracks
- Equestrian Centers
- Medical Campuses
- General Plan Economic Elements
- Labor Market Studies
The State of California, under Health and Safety Code § 33030, defines Blight as either Economic Blight or Physical Blight as follows:Economic Blight:
- Depreciated or stagnant property values.
- Impaired property values due to hazardous waste.
- High vacancies including abandoned buildings and low lease rates.
- Lack of essential commercial facilities.
- Residential overcrowding.
- An excess of “undesirable” commercial facilities.
- High crime rate.
- Buildings deemed unsafe or unhealthy.
- Buildings with substandard or defective designs.
- Incompatible land uses hindering development.
- Irregularly shaped and inadequately sized lots resultant of multiple ownerships.
- It is found and declared that there exist in many communities blighted areas that constitute physical and economic liabilities, requiring redevelopment in the interest of the health, safety, and general welfare of the people of these communities and of the state.
- A blighted area is one that contains both of the following:
- An area that is predominantly urbanized, as that term is defined in Section 33320.1, and is an area in which the combination of conditions set forth in Section 33031 is so prevalent and so substantial that it causes a reduction of, or lack of, proper utilization of the area to such an extent that it constitutes a serious physical and economic burden on the community that cannot reasonably be expected to be reversed or alleviated by private enterprise or governmental action, or both, without redevelopment.
- An area that is characterized by one or more conditions set forth in any paragraph of subdivision (a) of Section 33031 and one or more conditions set forth in any paragraph of subdivision (b) of Section 33031.
- A blighted area that contains the conditions described in subdivision (b) may also be characterized by the existence of inadequate public improvements or inadequate water or sewer utilities.
- This subdivision describes physical conditions that cause blight:
- Buildings in which it is unsafe or unhealthy for persons to live or work. These conditions may be caused by serious building code violations, serious dilapidation and deterioration caused by long-term neglect, construction that is vulnerable to serious damage from seismic or geologic hazards, and faulty or inadequate water or sewer utilities.
- Conditions that prevent or substantially hinder the viable use or capacity of buildings or lots. These conditions may be caused by buildings of substandard, defective, or obsolete design or construction given the present general plan, zoning, or other development standards.
- Adjacent or nearby incompatible land uses that prevent the development of those parcels or other portions of the project area.
- The existence of subdivided lots that are in multiple ownership and whose physical development has been impaired by their irregular shapes and inadequate sizes, given present general plan and zoning standards and present market conditions.
- This subdivision describes economic conditions that cause blight:
- Depreciated or stagnant property values.
- Impaired property values, due in significant part, to hazardous wastes on property where the agency may be eligible to use its authority as specified in Article 12.5 (commencing with Section 33459).
- Abnormally high business vacancies, abnormally low lease rates, or an abnormally high number of abandoned buildings.
- A serious lack of necessary commercial facilities that are normally found in neighborhoods, including grocery stores, drug stores, and banks and other lending institutions.
- Serious residential overcrowding that has resulted in significant public health or safety problems. As used in this paragraph, “overcrowding” means exceeding the standard referenced in Article 5 (commencing with Section 32) of Chapter 1 of Title 25 of the California Code of Regulations.
- An excess of bars, liquor stores, or adult-oriented businesses that has resulted in significant public health, safety, or welfare problems.
- A high crime rate that constitutes a serious threat to the public safety and welfare.
- This subdivision describes physical conditions that cause blight:
- It is further found and declared that:
- The existence of blighted areas characterized by any or all of such conditions constitutes a serious and growing menace which is condemned as injurious and inimical to the public health, safety, and welfare of the people of the communities in which they exist and of the people of the State.
- Such blighted areas present difficulties and handicaps which are beyond remedy and control solely by regulatory processes in the exercise of police power.
- They contribute substantially and increasingly to the problems of, and necessitate excessive and disproportionate expenditures for, crime prevention, correction, prosecution, and punishment, the treatment of juvenile delinquency, the preservation of the public health and safety, and the maintaining of adequate police, fire, and accident protection and other public services and facilities.
- This menace is becoming increasingly direct and substantial in its significance and effect.
- The benefits which will result from the remedying of such conditions and the redevelopment of blighted areas will accrue to all the inhabitants and property owners of the communities in which they exist.