This is a Real Estate Development course. The attached Project is to be reviewed accordingly. Instructions are highlighted in a separate attachment. The Project must be read completely in order to get a clear picture of the Review. maybe a page or so.Thanks
Victoria Park Townhomes 1 VICTORIA PARK TOWNHOMES Final Development Project 2 Executive Summary ........................................................................................................ 3 Project Overview ............................................................................................................. 3 Market Analysis ............................................................................................................... 5 Comparable Market Analysis ........................................................................................ 10 Development Cost Analysis .......................................................................................... 11 Financial Analysis….…………………………………………………………………………..16 Conclusion .................................................................................................................... 18 Limitation to Analysis ..................................................................................................... 18 Appendix ....................................................................................................................... 19 Sources ......................................................................................................................... 23 TABLE OF CONTENTS 3 Executive Summary The subject townhome development site, Victoria Park is located at 915-921 NE 17th Avenue, Fort Lauderdale, FL 33304. The proposed site consists of 6 adjoining parcels with a land area of 40,500 square feet & RMM-25 zoning; permitted uses include multi- family and townhome developments. Up to 23 units can be built with a maximum height of 55 feet. The development site is just a few miles from Galleria Mall, Las Olas Blvd, Downtown Fort Lauderdale, Fort Lauderdale Beach, and the Fort Lauderdale Airport. The site is currently being offered at $3.3M and the plan is to build 18-townhome development totaling 45,846 sellable square feet or an average of 2,547 sellable square feet per townhome. The forecasted sales are at $370/square feet per comparable market analysis with a starting sale price of $943,390. With the research and analysis offered throughout this report, we concluded that total equity required is $4.089M resulting in a 46.6% BTIRR. NPV is $1.691M with a 15% required rate of return. Property Summary Victoria Park Townhomes 4 Property Address: 915-921 NE 17 Ter / 916-920 NE 17 Ave Fort Lauderdale, FL 33304 Asking Price: $3,300,000 PA Primary Zone: RMM-25 Residential Multifamily MidRise/ Medium High Density Primary Land Use: SF, MF, TH, Mixed Use (Conditional), Hotel (Conditional) Lot Size: 40,500 Sq. Ft Development Opportunity: Townhome Residential Development 5 Market Analysis Demand Analysis Fort Lauderdale is South Florida’s second-largest apartment market, with close to 120,000 apartments. The metro areas central location, strong economy, and growing demographics have improved the multifamily market in Fort Lauderdale. The subject property is located in the sub-market Victoria Park within the Fort Lauderdale metro area and within a 10-15 minute drive from Fort Lauderdale beaches, FL International Airport, and within a few blocks from Galleria Mall and Las Olas Boulevard. Victoria Park is one of the most desirable neighborhoods in Ft Lauderdale. Townhome properties are in strong demand as many families seek a safe and home-feel attribute that provides proximity to the attractions and amenities in the intermediate area. Major demand drivers are population, income, and employment growth that we will review within a 1 mile radius from the subject property. Population According to U.S. Census Bureau, Fort Lauderdale has grown its population by 10.1%. The national growth in the U.S. was 6.3% during the same time (seen in Figure 1). Figure 1. US Census Population Data 6 The population in the submarket of Victoria Park, where the subject property is located, is estimated to have grown from 7,273 (Census 2010) to 9,203 (2019) by ESRI which is a 27% population increase. By 2024, it is estimated that it will grow another 21%. Households in the same area grew by 24% from 2010 to 2019 and are estimated to grow to 6,298 households or an increase of 19% by 2024. Based on annual growth trend, households are estimated to grow 1.31% annually vs 0.75% nationally during 2019 through 2024 (seen in Figure 2). Figure 2. STDB Population and Household Demographic Data Household Income Median household income in Victoria Park during 2019 ($65,796), exceeded Fort Lauderdale ($55,269), and United States ($60,293) (seen in Figures 3 and 4). 7 Figure 3. US Census Bureau Median Household Income Data Median Household Income in Victoria Park (Figure 4) is estimated to increase to $78,416 or 19%. We also see a forecasted increase in higher household income. In 2019, 62.8% of household’s income was above $50,000. It is estimated, by 2024, that 70.5% of household incomes will be greater than $50,000 (seen in Figure 4). Figure 4. STDB Median Household Income Victoria Park - Data and Forecast Employment According to the Bureau of Labor Statistics, the metropolitan area of Fort Lauderdale has an unemployment rate of 16% as of April 30th, 2020 which is driven by the pandemic, Covid-19 (seen in Figure 5). Prior to pandemic, unemployment rate was only 3.1% (March 2020). 8 Figure 5. Bureau of Labor Statistics 2020 Employment Data The U.S. unemployment rate at the same time increased from 4.4% to 14.7% (seen in Figure 6). Figure 6. Bureau of Labor Statistics 2020 Employment Data Based on both inferred and fundamental analysis, strong economic demand exists in Victoria Park. Population growth and household income has been strong, and forecast is positive. Due to pandemic, unemployment rates have significantly increased and might affect the near future but we have not seen the signs in real estate yet. Marketability Victoria Park is the urban neighborhood for families who want to be near area attractions without sacrificing location. As you see in figure 7, the Townhomes Development is 3 miles from the beach. The beach is a popular location for major 9 events such as the Fort Lauderdale