a market conditions and project evaluation summary of - Georgia ...

Allen Wilson Phase III, Decatur, GA; Market Study
CONCLUSIONS
� Total population and total households are projected to increase in the Subject’s PMA
over the next five years, albeit slightly less of an increase than in the MSA and nation. .
The largest age cohorts in the PMA include persons ages 20 to 24 and 25-29 with a high
concentration of persons ages 0 to 4, 5 to 9 and 15 to 19. The prevalence of these age
groups in conjunction suggests that the PMA has a considerable family population.
Households within the PMA are split almost 50/50 between owner-occupied and renteroccupied
residences. Renter-occupied residences account for 50.75% which is a
significantly higher percentage than the 13% that they account for in the nation Owneroccupied
units are projected to decrease by June 2014 and renter-occupied units are
slated to increase which bodes well for the subject. The median household income was
$59,112 in the PMA in 2010, and is projected to increase to $68,310.00 by 2015. The
largest income cohort was between 100,000+. The Subject will target households earning
below $45,000. However, the subject will operate with 100 percent subsidy, and will be
replacement housing therefore we believe there to be adequate demand for the subject
proposed, despite the prevalence of high income households in the PMA.
According to RealtyTrac, this region experienced a medium foreclosure rate in April
2012 with approximately one out of every 833 housing units filing for foreclosure in
April 2012. Comparatively, the city of Decatur had a foreclosure rate of one in every 379
housing units, and the nation experienced a foreclosure rate of one in every 698 housing
units. Per our site visit, we did not see many abandoned or vacant structures in the
Subject’s immediate neighborhood.
� DeKalb County suffered recently from the effects of the nation-wide recession. DeKalb
County experienced employment growth through 2007. In 2008, total employment
decreased slightly, and then decreased in 2009 by over six percentage points. Average
annual employment estimates reflect the year-over-year change in total employment
which increased by 0.83 percent from September 20010 to September 2011.
� Between 2008 and 2009, total employment in the MSA decreased by 5.3 percent, causing
the unemployment rate to increase 3.6 percentage points. In 2010, the unemployment
rate was 10.2 percent, the highest in a decade, and 0.6 percent higher than the national
average. Between March 2011 and March 2012, total employment increased 2.3 percent,
and the unemployment rate decreased 0.9 percent. As of March 2012, the unemployment
rate was slightly above the unemployment rate of the Nation. However, the subject will
operate with 100 percent subsidy, and will be replacement housing therefore we believe
there to be adequate demand for the subject proposed, despite the unemployment rate
being slight above that of the nation.
� Per GA DCA’s guidelines (see addenda) the Subject will have a capture rate of zero
percent as it offers 100 percent subsidy and therefore the units are presumed leasable.
� We were able to obtain absorption information from two comparable properties,
illustrated following.
Novogradac & Company, LLP 106