RCLCO Market Analysis - City of New Smyrna Beach

Market Analysis for the City of New Smyrna
Beach CRA Redevelopment Master Plan
New Smyrna Beach CRA | May 12, 2009
BACKGROUND AND OBJECTIVES
Report Preparation Melina Duggal, Senior Principal
Ashley Shrader, Associate
Orlando, FL (407) 515-6592
Background
RCLCO was retained by the New Smyrna Beach CRA to provide
a market analysis for the New Smyrna Beach Community
Redevelopment Area, eventually providing site specific
recommendations and programming. In order to help select the
most appropriate sites for development, RCLCO is providing the
following preliminary market assessment based on development
potential by ‘district’ within the CRA.
Objectives
Provide development programs for up to four selected sites that
address the appropriate market position, achievable prices
associated with that positioning, density appropriate for target
market audiences, absorption potential, and timing given current
market conditions. RCLCO will also prepare a schedule of land
sales revenues based on the estimated absorption, timing, and
residual land values at each site.
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RCLCO: LEADING KNOWLEDGE SOLUTIONS
PROVIDER TO THE REAL ESTATE INDUSTRY
` 10,000 engagements since 1967
` Offices in Washington, DC, Los Angeles, Orlando, Atlanta
` Projects throughout the US, Caribbean, Latin America, Europe, the Middle
East, and SE Asia
` Clients include:
ƒ Developers and Corporations
ƒ Financial Institutions
ƒ Hospitality and Recreation Companies
ƒ Public and Non Profit Organizations
ƒ Professional Service Firms
` RCLCO Team comprised of:
ƒ Developers
ƒ Analysts
ƒ Architects and Planners
ƒ Capital Markets Experts
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RCLCO – WHO WE ARE, WHAT WE DO
Strategy
`Corporate
`Portfolio
`Asset
`Green
Feasibility
`Market Demand
Analysis
`Financial
Optimization
`Fiscal & Economic
Impact
`Consumer Research
`Product
Segmentation,
Positioning & Pricing
`Amenity
Programming
Transaction
Implementation
`Valuation Services
`Entitlements
`Public/Private
Partnerships
`Project Team
Formation
`Structured Finance
(Public & Private)
`Development Concept
& Design
`Mergers and
Acquisitions
`Stakeholder
Engagement
`Capital Formation
`Project Management
`Dispositions
`Owner Representation
`Work-out &
Restructuring
`Portfolio & Asset
Management
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RCLCO – PROPERTY TYPE AND PROJECT
EXPERTISE
Residential
`Master-Planned Communities
`Apartments, Condominiums
`Single-Family, Townhomes
`Active Adult Communities
`Independent, Assisted Living,
CCRC
`Second Home Communities
`Affordable/Workforce Housing
`Conservation Communities
Retail
`Lifestyle/Entertainment Centers
`Neighborhood Centers
`Regional/Super Regional Malls
Hotel, Condo-Hotel
`Conference/Convention Hotel
`Beach, Mountain, Lake Resorts
`Casino, Marina
Office/Industrial/Campus
`Office Parks
`R&D/Industrial
`University/Medical Campus
Other
`Transit-Oriented Development
`Mixed-Use
`Adaptive Reuse
`Brownfield Redevelopment
`Downtown and Corridor
Revitalization
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AGENDA
Subject Site Analysis
National and Regional Context
Residential Market Analysis
Retail Market Analysis
Office Market Analysis
Hotel Market Analysis
Follow-up Items
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PRELIMINARY SITE ANALYSIS OF THE CRA
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AREAS WITHIN THE CRA CAN BE DEFINED BY DISTRICTS
DISTINGUISHED BY THE CHARACTER OF EACH AREA’S SURROUNDING
DEVELOPMENT
MAP KEY
Residential District
Canal Street District
North Causeway District
Flagler Avenue District
A1A District
Commercial District
1
Districts defined based upon character of surrounding development
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EACH DISTRICT OFFERS ITS OWN UNIQUE
STRENGTH
RESIDENTIAL
DISTRICT
CANAL
STREET
DISTRICT
NORTH
CAUSEWAY
DISTRICT
FLAGLER
AVENUE
DISTRICT
A1A DISTRICT
COMMERCIAL
DISTRICT
$28,000
$37,000
$86,000
$69,000
$55,000
$52,000
PROXIMITY TO
EMPLOYMENT1
XXX
XXXX
XX
XX
X
XX
DAYTIME POPULATION2
306
1,794
83
73
251
118
PEAK TRAFFIC COUNTS
24,500
24,500
8,900
8,900
16,700
27,500
XXX
XXXX
XX
XX
XX
XXX
0
0
0
0
0
2
MEDIAN HOME VALUES
$115,000
$221,000
$347,000
$272,000
$269,000
$265,000
WATER ORIENTATION4
X
XX
XXXX
XXX
XXXX
XX
NEIGHBORHOOD APPEAL5
X
XXX
XX
XXXX
XXXX
XX
43%
57%
79%
69%
66%
66%
DISTRICT
CHARACTERISTICS
MEDIAN INCOME
CONNECTION TO
SURROUNDING AREA3
NUMBER OF
GROCERY/DRUG STORES
PROPENSITY TO OWN
HOME
1 Based
on the number of major employers in and around the district
of employees working within the district
3 Based on each districts connectivity to other areas to the City of New Smyrna Beach
4 Based on each district's proximity to the beach and Intracoastal Waterway
5 Based on the overall character and charm of each district
2 Number
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THE DISTRICTS ALSO VARY IN THE EXISTING AND
PLANNED LAND USES
CANAL
STREET
DISTRICT
NORTH
CAUSEWAY
DISTRICT
FLAGLER
AVENUE
DISTRICT
113
111
93
10
55
24
28,456
163,002
30,201
32,783
27,257
57,677
0
0
0
2
3
0
3,049
118,053
39,472
3,291
5,908
12,538
RESIDENTIAL
SUPPLY CHARACTERISTICS
DISTRICT
COMMERCIAL
A1A DISTRICT DISTRICT
CURRENT SUPPLY
RESIDENTIAL (UNITS)
RETAIL (SF)
NUMBER OF HOTELS
OFFICE (SF)
PLANNED AND PROPOSED SUPPLY
RESIDENTIAL (UNITS)
0
0
120
30
25
12
RETAIL (SF)
0
0
4,000
1,363
0
4,356
NUMBER OF HOTELS
0
0
0
0
0
0
OFFICE (SF)
0
2,644
4,000
3,533
0
0
Source: Volusia County Property Appraiser; New Smyrna Beach Planning Department
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RESIDENTIAL DISTRICT
Canal Street
Commercial
District
Community
Center
SOURCE: Google Earth, MapPoint, RCLCO
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ALTHOUGH CURRENT LAND USES IN THE RESIDENTIAL DISTRICT
ARE MOST CHALLENGING, THERE ARE OPPORTUNITIES FOR
REDEVELOPMENT
STRENGTHS
Well-located near hospital and Canal
Street Commercial District
Strong access to US 1 and Canal
Street
Community Center centrally located in
residential area
THREATS
Predominantly lower income residential
land uses
Older commercial uses do not blend
well with neighboring Canal Street
Lowest home values within the CRA
Safety is a concern
Railroad tracks could make it difficult to
connect the Residential District to
Canal Street
OPPORTUNITIES
Strong traffic counts on US 1 could potentially support retail development
Opportunity to build off of Community Center – help build the social structure of the
neighborhood
Construct affordable/work force housing
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CANAL STREET DISTRICT
Public Parks
Intracoastal
Waterway
Canal Street
Commercial
Area
Beach: 2 Miles
Hospital (~700
employees)
SOURCE: Google Earth, MapPoint, RCLCO
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A STRONG EMPLOYMENT BASE PROVIDES SEVERAL DEVELOPMENT
OPPORTUNITIES FOR THE CANAL STREET DISTRICT
STRENGTHS
Contains Bert Fish Memorial Hospital, a
major employer
Contains Canal Street Historic Downtown, a
historic downtown area that offers several
dining options and specialty shops
Has two well-maintained public parks
Area offers multiple views of the Intracoastal
Waterway
Several government offices located in the
area, providing additional employment
Strong access to both the South and North
Causeways
THREATS
Lack of connection between Hospital and
Canal Street Commercial
Area south of hospital is rundown and
industrial
US-1 Commercial is older and less appealing
than Canal Street
Area along US-1 and SR 44 is not walkable
OPPORTUNITIES
Potential to work with the hospital on synergistic development opportunities (e.g. supportive
retail, residential, etc.)
Capitalize on the high daytime population from office users to support retail
Create a stronger connection from downtown to the waterfront
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NORTH CAUSEWAY DISTRICT
Mix of older
condominiums and
commercial
development
Beach: 1/2 Mile
Intracoastal
Waterway
Proposed
mixed-use
project
Marine
Discovery
Center/ Boat
T
SOURCE: Google Earth, MapPoint, RCLCO
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UNDEVELOPED LAND WITH WATER ORIENTATION MAKES THE
NORTH CAUSEWAY DISTRICT APPEALING FOR HIGH-VALUE
DEVELOPMENT
STRENGTHS
Strong Intracoastal Waterway
orientation
Surrounding residential areas are
appealing; strong home values
Less congested than South Causeway
Located near the Flagler Avenue
Commercial District, a popular tourist
area
Proposed new mixed-use development
at southwest corner of the district
Municipally-owned marina
THREATS
South Causeway more popular route to
beach
No retail and services within the area
OPPORTUNITIES
Capitalize on excellent Intracoastal Waterway orientation
Significant undeveloped large parcels of land
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FLAGLER AVENUE DISTRICT
Walkable commercial
district with retail and
dining options
SOURCE: Google Earth, MapPoint, RCLCO
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THE FLAGLER AVENUE DISTRICT IS CURRENTLY A THRIVING RETAIL
DISTRICT THAT CATERS TO TOURISTS; PARKING SOLUTIONS COULD
INCREASE THE RETAIL POTENTIAL OF THE DISTRICT
STRENGTHS
THREATS
Thriving retail district
Lack of parking for retail patrons
Popular tourist destination
Area feels congested
Strong beach orientation
Thin strip leaves little opportunity for
significant development
Favorable surrounding residential uses
OPPORTUNITIES
Creating parking solutions would help retail tenants
Utilize pedestrian foot traffic to attract retail tenants
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A1A DISTRICT
SOURCE: Google Earth, MapPoint, RCLCO
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DUE TO ITS UNIQUE OCEAN ORIENTATION, THE A1A DISTRICT HAS
POTENTIALLY THE HIGHEST VALUED PROPERTY WITHIN THE CRA
STRENGTHS
THREATS
Developable oceanfront parcels
Current uses are predominantly older
condominium product
Strong beach orientation
Strong A1A frontage
Connects to two major commercial
areas
Multiple public beach entry points
OPPORTUNITIES
Potentially the highest valued property within the CRA
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THIRD AVENUE COMMERCIAL DISTRICT
Intracoastal
Strip Center
with no
Anchor
SOURCE: Google Earth, MapPoint, RCLCO
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DESPITE LACKING CONNECTIVITY, THE THIRD AVENUE COMMERCIAL
DISTRICT HAS THE OPPORTUNITY TO UTILIZE ITS STRONG TRAFFIC COUNTS
AND PROXIMITY TO THE BEACH TO DRIVE RETAIL DEVELOPMENT
STRENGTHS
THREATS
Very high traffic counts
Current commercial uses are old
Strong 3rd Avenue frontage
High levels of congestion
Intracoastal water orientation
Not pedestrian oriented
Dense surrounding residential area
Anchor tenant space vacant in strip
center
OPPORTUNITIES
Redevelop older strip centers to increase appeal of 3rd Avenue
Make the area more pedestrian friendly
Increase connectivity from 3rd Avenue to the beach
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PRELIMINARY ASSESSMENT OF DEVELOPMENT
OPPORTUNITY BY LAND USE AND DISTRICT
LAND USE
RESIDENTIAL
DISTRICT
CANAL
STREET
DISTRICT
NORTH
CAUSEWAY
DISTRICT
FLAGLER
AVENUE
DISTRICT
RESIDENTIAL
X*
XX
XXX
XXXX
XXXX
X
RETAIL
XX
XXX
XX
XXXX
XX
XXXX
HOTEL AND EVENT
SPACE
X
XXX
XX
XXX
XXXX
XX
SMALL PROFESSIONAL
SERVICE OFFICE
X
XXXX
X
XX
X
X
COMMERCIAL
A1A DISTRICT DISTRICT
X = Limited or no development opportunity, XXXX = Strong development opportunity
* Opportunity for affordable/workforce housing
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NATIONAL ECONOMIC OUTLOOK
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NATIONAL ECONOMIC OUTLOOK
Deep US Recession 2009 to 2010
• Consensus economic forecasts
– Not much optimism for 2009
Recovery Scenarios
• Relatively Rapid “V” Recovery in 2010 Low Probability
• More Moderate “U” Recovery in 2011 –
More Likely
– Influenced by low oil prices
– Historically low interest rates
– Impact of the fiscal Stimulus
– Return of private investment
– Gradually restored confidence
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THE CURRENT SITUATION
REAL ESTATE BY SECTOR
Bullish excesses pave the way to bearish corrections
Fear
Elation
Recovery
Upturn
Exuberance
Mature
25
Panic
Fear
Downturn
Recovery
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THE U.S. HAS EXPERIENCED SEVERAL HOUSING DOWNTURNS
SINCE 1976 CAUSED BY SIGNIFICANT DROPS IN EMPLOYMENT
THE ’80S DOWNTURN BEING THE MOST SIGNIFICANT THUS FAR
Number of New Single Family Home Sales Compared to Employment Growth in the U.S.
1976 – 2012(P) 1
4 years of
decreased
home sales
1,400,000
3 years of
decreased
home sales
Missed the
boat
???
6%
Single Family Home Sales
4%
1,000,000
800,000
2%
600,000
400,000
0%
200,000
1
Single Family Home Sales
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
-2%
1976
0
Annual % Growth in Employment
1,200,000
% Grow th in Employment
2007 figure is annualized.
SOURCE: NAHB; BLS, US Dept of Labor
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HOME SALES HAVE DROPPED BELOW 2003 LEVELS; HOWEVER,
SECOND HOME SALES STILL REPRESENT ~30% OF ALL HOME SALES
Share of Home Sales by Intended Use
US, 2003-2008
9,000,000
8,000,000
36%
% Second Home
40%
36%
34%
7,000,000
2,003,000
2,317,000
33%
1,646,000
1,571,000
6,000,000
5,000,000
849,000
872,000
1,019,000
1,349,000
30%
1,067,000
740,000
4,000,000
1,120,000
512,000
3,000,000
2,000,000
4,841,000
5,106,000
5,023,000
4,816,000
4,336,000
3,770,000
1,000,000
0
2003
2004
Primary
2005
2006
2007
Vacation
Investment
2008
SOURCE: 2009 NAR Investment and Second Home Buyers Survey
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FLORIDA OUTLOOK
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FLORIDA OUTLOOK
Florida is still projected to grow by average of 830 people per day between 2008
and 2025
• Down from 1,000 people per day
• 2009 and 2010 are projected to average 630 people per day – slower but still
growing
– Florida is not experiencing negative net migration, source markets are evolving and
Florida is continuing to grow
Employment growth projected in 2010 and 2011 to begin making up for job losses
Residential projected to return to pre-boom pace in 2012
Commercial projected to return after residential
National demographic trends (baby boomers) should have a positive impact on
Florida’s long-term outlook
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THE EAST CENTRAL FLORIDA REGION IS PROJECTED
TO RECEIVE THE MOST GROWTH THROUGH 2025
Projected Population Growth (Thousands) by Planning Region
2008 to 2025
263
127
158
676
1,240
391
256
758
579
720
667
SOURCE: BEBR
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WHAT OPPORTUNITIES EXIST FOR FLORIDA’S FUTURE?
EVOLVING ECONOMY
Florida’s economy can no longer solely rely
on tourism, real estate, and retirees to drive
growth
• Expansions of ports, new bio-tech firms,
and other industry growth indicates that
Florida’s economy is diversifying, giving
Florida the opportunity to better compete
with other parts of the country
Job growth will likely not return until 2010 and
possibly 2011
Industries, like construction, will likely not
return to pre-recession levels
• Professional Business Services and
Education and Health Services are
expected to experience the most
significant growth
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WHAT OPPORTUNITIES EXIST FOR FLORIDA’S FUTURE?
REAL ESTATE OUTLOOK
Residential
Depending on the credit markets and the loosening
of credit, Florida’s housing starts will likely remain at
historic lows in 2009 and begin to stabilize in 2010
Population growth is projected to remain low for
2009 and 2010
Current projections indicate that housing starts will
likely near pre-boom levels in 2012
Commercial
The downturn of commercial real estate followed
residential real estate with increasing vacancy rates
starting in late 2007 and early 2008
As a result, the recovery will likely also follow
residential real estate
In addition to the return of the residential real estate
market, key factors for recovery in commercial real
estate will be increased consumer confidence and
employment growth
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Northeast Florida Outlook
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NORTHEAST FLORIDA OUTLOOK
The Jacksonville area is one of the strongest economies in the state and should
remain that way
• Diverse job sectors
• Tourism and natural features
• Not as dramatic uptick during the boom
• Moderate climate
Northeast Florida (Nassau, Duval, Clay, St. Johns, Flagler and Volusia Counties)
has faired better than the rest of the state, and is projected to remain strong
The strength of Duval County and City of Jacksonville has masked the job losses
in other counties
• Flagler County will take longer to recover
• Volusia County (technically part of Central Florida) has seen larger declines in
population and employment projections
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VOLUSIA COUNTY IS PROJECTED TO CAPTURE LESS THAN ITS
FAIR SHARE OF THE REGION’S GROWTH THROUGH 2025
1.50
40
1.25
92
0.34
10
Score of less than
1 means area is
LOSING market
share
0.81
289
2.11
151
Score of greater
than 1 means area
is GAINING
market share
2.20
83
Formula:
Numerator = share
of region’s growth
Key:
Fair Share
2008-2025 Population
Growth (Thousands)
0.65
132
Denominator =
share of population
SOURCE: BEBR
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POPULATION PROJECTIONS FOR THE REGION
WERE LOWERED 20%
Change in Projected 2008 to 2025 Population Growth
Northeast Florida
2006 vs. 2008 Projections
3,400
-49,700
8,900
-33,800
-40,800
-5,500
-83,200
SOURCE: BEBR
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THROUGH 2025, VOLUSIA IS PROJECTED TO GROW BY
1.4% ANNUALLY
Projected Annual Population Growth
Volusia County, Florida
2008-2025
10,000
Volusia County
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
25
20
24
20
23
20
22
20
21
20
20
20
19
20
18
20
20
17
16
20
15
20
14
20
13
20
12
20
11
20
10
20
09
20
20
08
0
SOURCE: BEBR
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VOLUSIA COUNTY IS PROJECTED TO ADD 3,900 JOBS
ANNUALLY THROUGH 2016
Historical and Projected Annual Employment Growth
Volusia County, Florida
2002-2016
10,000
Volusia County
While not reflected in
current projections, it is
expected that most of the
state will not experience
much job growth in 2009.
8,000
6,000
4,000
2,000
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
-2,000
SOURCE: BLS; Florida Labor Market Statistics
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RESIDENTIAL ANALYSIS
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THE SUBJECT PROPERTY IS WELL-POSITIONED TO CAPITALIZE ON
MULTIPLE TYPES OF RESIDENTIAL DEVELOPMENT, TARGETING
SPECIFIC MARKET AUDIENCES BY PRODUCT AND LOCATION
Total sales pace in New Smyrna very stable compared to Florida
– Multifamily sales account for a large portion of total sales
– Both single-family and multifamily sales have experienced an
increased capture rate of Volusia County home sales
Permits have declined
• In 2008, New Smyrna captured the majority of multifamily building
permits in Volusia County
• Single-family permits down to levels not seen in a decade
The CRA has the opportunity to capture a diverse array of buyers,
depending on the orientation and location of the parcel
The CRA is well-positioned to capitalize on the multifamily market
currently dominating residential real estate in New Smyrna Beach
As is demand for approximately 250 for-sale and 50 for-rent units
per year in New Smyrna Beach
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ACTIVELY SELLING COMMUNITIES OFFERING AMENITIES
OR OCEAN ORIENTATION CAPTURED THE MOST SALES
1
3
MAP
TOTAL
KEY PROJECT
UNITS
SINGLE-FAMILY PRODUCT
1 Venetian Bay 3
1,800
Lakewood
2 Terrace
74
3 Sugar Mill
283
4 Edgewater Lakes
95
MULTIFAMILY PRODUCT
5 OceanWalk
627
6 SeaCrest
39
7 Bouchelle Island
123
7
2
6
5
HIST.
MO. EST. HIST.
ABS. CAPTURE 1
AVG.
HOME
PRICE 2
13
31%
$346,000
1
4
1
2%
10%
3%
$220,000
$125,000
$200,000
4
1
0
21%
1%
3%
$280,000
$1,300,000
$315,000
Subject Area
4
1
Based on average annual sales in New Smyrna Beach from 2002 to present
2
Average price is based on broker conversations
3
Although predominantly single-family, Venetian Bay offers condominium product
SOURCE: RCLCO
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MOST INLAND SINGLE-FAMILY PRODUCT HAS ATTRACTED PRIMARY HOME BUYERS
WHILE SECOND HOME BUYERS PREFER WATER-ORIENTED CONDOMINIUMS; EMPTY
NESTERS AND RETIREES MAKE UP A LARGE PORTION OF THE CURRENT MARKET
MAP
KEY
PROJECT
% YOUNG
SING/ COUP
% FAM
% EN/ RET
PRIMARY
HOME
SECOND
HOME
SINGLE-FAMILY PRODUCT
1
Venetian Bay1
10%
15%
65%
50%
50%
2
Lakewood Terrace
10%
60%
30%
70%
30%
3
Sugar Mill
30%
40%
30%
75%
25%
4
Edgewater Lakes
10%
30%
60%
80%
20%
MULTIFAMILY PRODUCT
1
5
OceanWalk
40%
20%
40%
50%
50%
6
SeaCrest
15%
15%
70%
20%
80%
7
Bouchelle Island
10%
10%
80%
20%
80%
Although predominantly single-family, Venetian Bay offers condominium product
SOURCE: RCLCO
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CURRENT APARTMENT SUPPLY IS LIMITED AND LOCATED
OUTSIDE OF NEW SMYRNA BEACH’S EMPLOYMENT CORE
1
Subject Area
2
Employment
Core
MAP
KEY
DEVELOPMENT NAME
#
UNITS
YEAR
BUILT
OCC.
WTD.
AVG.
RENT
WTD.
AVG.
SIZE
WTD.
AVG.
$/SF
1
Lyme Stone Ranch
216
2004
94%
$910
972
$0.96
2
Newport Sound 1
177
2004
100%
$566
1,088
$0.53
1 Tax Credit community
SOURCE: RCLCO
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POTENTIAL RESIDENTIAL OPPORTUNITIES
WITHIN THE CRA
DISTRICT
RESIDENTIAL
DISTRICT
CANAL STREET
DISTRICT
NORTH CAUSEWAY
DISTRICT
FLAGLER AVENUE
DISTRICT
LEVEL OF
OPPORUNITY
X
•Low home values and household incomes not supportive of market-rate new
residential development
•High propensity to rent in the area indicates a possibility to support rental units
•Strong opportunity for affordable/workforce housing
XX
•Rental and for-Sale units catering to young singles and professionals as well as
empty nesters and retirees
•Strong opportunity in conjunction with mix of uses
XXX
XXXX
A1A DISTRICT
XXXX
COMMERCIAL
DISTRICT
POTENTIAL SUPPORTABLE USES
X
•Water orientation along the Northern Causeway is highly valued
•Peak incomes, home values, and owner propensity indicate a potential
opportunity for high-end residential
•Strong opportunity in conjunction with mix of uses
•Rental and for-Sale units catering to locals as well as tourists
•Luxury rental and for-sale units catering to professionals and empty nesters,
retirees, and second home buyers
•Oceanfront property could command high premiums
•A lack of water orientation combined with a high concentration of unappealing
commercial uses limits residential opportunity
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RETAIL ANALYSIS
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ALTHOUGH RETAIL DEVELOPMENT HAS SLOWED IN RECENT YEARS,
CERTAIN AREAS IN NEW SMYRNA ARE WELL-POSITIONED FOR
RETAIL REDEVELOPMENT
With the exception of a new Home Depot opening in 2006, new retail
in Smyrna Beach is typically under 50,000 square feet and has been
relatively limited
The New Smyrna Beach CRA is slowly losing its capture of new
retail to other areas of New Smyrna Beach
• Development opportunities in the CRA would most likely be fueled
by redevelopment
Traffic counts suggest strong retail opportunities along A1A and
US1, for the Residential, Canal Street, and Third Avenue Districts
Most strip centers in New Smyrna have strong occupancy
• The vacant Outback Plaza presents a possible opportunity for
redevelopment
Statistical demand analysis reveals the majority of future retail
demand in the CRA will be driven off of growing households and
tourism – approximately 100K more SF in next 10 years
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A STRONG DAYTIME POPULATION IN THE CANAL STREET DISTRICT
COULD POTENTIALLY SUPPORT ADDITIONAL RETAIL
Major Employers in New Smyrna Beach
2009
12
14
18
15
13
2
3
19
6
1
10
4
2
7
9
11
16
8
5
#
#
Employees of Major Employers
Within CRA
Employees of Other Major New
Smyrna Beach Employers
11
17
1,620
MAJOR NEW SMYRNA EMPLOYERS # OF EMP.
1 Bert Fish Medical Center
700
2
2 Publix Supermarkets
303
3 New Smyrna Beach City
261
4 Wal-Mart
207
5 New Smyrna Beach High School
200
6 City Utilities Commission
173
7 Ocean View Nursing and Retirement
170
8 New Smyrna Beach Middle School
150
9 Winn Dixie
144
10 Home Depot
121
11 McDonalds2
106
12 Epic Aviation
100
13 Norwood's Restaurant and Wine Shop
100
14 Sugar Mill Country Club
100
15 Volusia Medical Center
90
16 Chase's Beachfront Bar
83
17 Daytona Beach Community College
80
18 The Grille at Riverview
72
19 Pink Door Hospital Auxiliary
72
TOTAL
3,232
Subject Area
1,613
SOURCE: InfoUSA Employer Database 2009.1
47
06-11579.03
OUTBACK PLAZA WITHIN THE CRA HAS THE
OPPORTUNITY TO BE REDEVELOPED
6
1
2
3
4
5
MAP
KEY
1
2
3
4
5
6
SHOPPING CENTER
New Smyrna Beach Regional Shopping Center
Indian River Village Shopping Center
K-Mart Plaza
New Smyrna Beach Shopping Plaza
Ocean Village Square
Outback Plaza
AVERAGE
GLA
118,451
116,000
108,263
101,321
60,631
48,607
92,212
OCC.
100%
100%
94%
85%
81%
26%
81%
Subject Area
SOURCE: LoopNet , RCLCO
48
06-11579.03
POTENTIAL RETAIL OPPORTUNITIES WITHIN THE
CRA
DISTRICT
RESIDENTIAL
DISTRICT
CANAL STREET
DISTRICT
NORTH CAUSEWAY
DISTRICT
FLAGLER AVENUE
DISTRICT
LEVEL OF
OPPORUNITY
XX
XXX
XX
XXXX
A1A DISTRICT
XX
COMMERCIAL
DISTRICT
XXXX
POTENTIAL SUPPORTABLE USES
•High traffic counts on US 1 favorable for retail development
•Lack of grocery or drug store to serve households in immediate area
•Strong daytime population and employment base to support additional retail
•Hospital employees are currently underserved; linkage must be provided from
Canal Street to Hospital
•Strong household incomes within the district, however, limited traffic on the
Northern Causeway and a limited household base could restrain this opportunity
•Currently very strong retail district
•Limited available land for parking and new development may restrict this
opportunity
•Small-scale retail developed in conjunction with the beach and residential
•Likely a high concentration of destination driven users (restaurant, spa/salon)
•Strong traffic counts, high incomes, and home values indicate the potential for
new retail here
•Opportunity to redevelop centers currently struggling
•High traffic congestion will be a challenge
49
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OFFICE ANALYSIS
50
06-11579.03
THE OFFICE MARKET IN NEW SMYRNA IS INSULATED;
MOSTLY CONCENTRATED IN THE CRA
Most of the office space in New Smyrna Beach is located within
the CRA
• The completion of the office portion of Tuscany Square Town
Center at Venetian Bay has caused the CRA to lose capture
of New Smyrna Beach office supply
Although recently declining, New Smyrna Beach employment is
projected to increased by 39,000 over the next ten years
Employment distribution in New Smyrna Beach suggests
employment growth would be concentrated in health and
services
Statistical demand analysis suggests there is 40,000 to 50,000
square feet of office demand over the next ten years with
current capture rates
51
06-11579.03
DESPITE RECENT JOB LOSS, EMPLOYMENT GROWTH IS
PROJECTED TO REMAIN STRONG IN VOLUSIA COUNTY
Historical and Projected Volusia County Employment
1990 to 2016
220,000
Projection
200,000
180,000
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
SOURCE: Florida Labor Market Info, RCLCO
52
06-11579.03
NEW SMYRNA BEACH HAS A STRONG LOCAL EMPLOYMENT BASE IN
OFFICE-GENERATING EMPLOYMENT SECTORS SUCH AS FINANCE,
INSURANCE, REAL ESTATE, AND GOVERNMENT
Employment Distribution in New Smyrna Beach
2008
497
320
51
550
Services
710
Retail Trade
4,238
Government
Finance, Insurance, Real Estate
Construction
1,202
Manufacturing
Transport/Communication, Utilities
Wholesale Trade
Agriculture & Natural Resources
Resource Extraction
1,938
4,110
SOURCE: Claritas
53
06-11579.03
POTENTIAL OFFICE OPPORTUNITIES WITHIN THE
CRA
DISTRICT
RESIDENTIAL
DISTRICT
CANAL STREET
DISTRICT
NORTH CAUSEWAY
DISTRICT
FLAGLER AVENUE
DISTRICT
LEVEL OF
OPPORUNITY
X
POTENTIAL SUPPORTABLE USES
•Limited opportunity; Canal Street is better positioned to serve the professional
office needs of the area
XXXX
•Potential opportunity to provide space for small, professional serving users who
appreciate the unique mixed-use environment (i.e. dentist, chiropractor, lawyer,
etc.) and medical office to support the hospital
XX
•Low daytime population and weak connection to surrounding employment base
•May be a limited opportunity to provide space for small users as a part of a
mixed-use development project
XX
•May be a limited opportunity to provide space for small, professional users
•Limited available land for parking and new development may restrict this
opportunity
•May be a limited opportunity to provide space for small, professional users
A1A DISTRICT
X
COMMERCIAL
DISTRICT
•May be a limited opportunity to provide space for small, professional users
XX
54
06-11579.03
HOTEL ANALYSIS
55
06-11579.03
HOTEL APPEARS TO BE A STRONG OPPORTUNITY IN THE
CRA
Lack of new hotel supply in the surrounding areas could bode
well for new hotels in CRA
Most visitors to New Smyrna Beach stay in a condo or
timeshare; this could be due to the lack of hotel supply in the
area
• There is only one branded, major hotel in New Smyrna
Beach
There is unmet demand for hotels with event space serving
both leisure and business guests
According to statistical demand analysis there are currently up
to 400 potential supportable hotel rooms within Volusia County
in the next 10 years – New Smyrna Beach is well-positioned to
capture this demand
56
06-11579.03
MOST OF THE HOTEL SUPPLY IN THE AREA SURROUNDING NEW
SMYRNA BEACH WAS BUILT IN THE EARLY 1980’S
Total Hotel Rooms within a Ten Mile Radius of New Smyrna Beach
1980 to 2008
3,000
200
190
180
170
2,500
160
150
140
2,000
130
120
110
100
1,500
90
80
70
1,000
60
50
40
500
30
20
10
0
0
1980
1982
1984
1986
1988
1990
1992
1994
1996
Total New Rooms per Year
1998
2000
2002
2004
2006
2008
Total Hotel Room Supply per Year
SOURCE: Volusia County Property Appraiser, RCLCO
57
06-11579.03
MOST VISITORS TO NEW SMYRNA BEACH STAY IN A
CONDO OR TIMESHARE
Type of Accommodation Stayed in According to Visitor Guestbook
2008
Condo
Timeshare
Conversations with the Visitor’s Bureau
indicate:
Family
• Almost all visitors to New Smyrna Beach are
leisure-related
Campground/RV
• Most visitors to New Smyrna Beach stay in
rented condominiums
House
• Families/extended families are more likely to
stay in a rented condominium
Friends
• Hotels typically attract couples looking for a
shorter stay (most condominiums require a
three night minimum stay)
Hotel/Motel
B&B
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
SOURCE: New Smyrna Beach Visitor's Bureau
58
06-11579.03
THE LOW PERCENTAGE OF GUESTS STAYING IN HOTELS COULD BE
DUE TO THE LOW LEVEL OF HOTEL ACCOMMODATIONS IN NEW
SMYRNA BEACH
Major Hotels Near the CRA
7
6
MAP
KEY
5
4
8
2
#
ROOMS
CURRENT
RATES
AVG.
OCC.
1
Holiday Inn & Suites New
Smyrna Beach
102
$94 to $180
WND*
2
Best Western Edgewater Inn
45
$89 to $134
WND
3
Islander Beach Resort
114
WND
WND
4
La Quinta Inn & Suites Port
Orange
72
$79 to $109
40%
5
Days Inn Daytona Beach
Tropical Seas
75
$93 to $114
80%
6
Palm Plaza Oceanfront
Resort
102
WND
WND
7
Hampton Inn Daytona Bch
Shores Oceanfront
114
$110 to $174
WND
8
Country Inn & Suites Port
Orange
87
N/A
N/A
1
3
HOTEL
Subject Area
WND = Would not Disclose
* According to the Visitor’s Bureau, this hotel is usually close to full occupancy
SOURCE: RCLCO
59
06-11579.03
CONVERSATIONS WITH THE NEW SMYRNA BEACH VISITOR’S
BUREAU INDICATE THERE IS STRONG DEMAND FOR HOTELS WITH
EVENT SPACE
There is strong demand for event space
• Currently, the most popular spaces are
Volusia Fairgrounds, Brannon Center
(~200 people), Hidden Lakes (~250
people), and Sugar Mill (~600 people)
Weddings are the most popular type of
event
There is strong demand for business
events however these types of events
usually require the hotel to be co-located
with the event space, an accommodation
not currently available within New Smyrna
Beach
60
06-11579.03
POTENTIAL HOTEL OPPORTUNITIES WITHIN THE
CRA
DISTRICT
RESIDENTIAL
DISTRICT
CANAL STREET
DISTRICT
NORTH CAUSEWAY
DISTRICT
FLAGLER AVENUE
DISTRICT
LEVEL OF
OPPORUNITY
X
XXX
XX
XXX
A1A DISTRICT
XXXX
COMMERCIAL
DISTRICT
XX
POTENTIAL SUPPORTABLE USES
•Limited opportunity to compete with nearby water-oriented condominium rentals
and hotels
•Potential opportunity for small hotel serving professionals and providing
alternative event space (i.e. weddings, conference, etc.)
•Limited hotel supply in area due to condominium development and zoning
constraints
•Potential to utilize water orientation for small hotel serving tourists
•Potential to utilize beach orientation for small hotel serving tourists
•Limited available land for parking and new development may restrict this
opportunity
•Limited oceanfront hotel supply in area due to condominium development and
zoning constraints
•Potential to utilize beach orientation for small to mid-sized hotel serving tourists
•A lack of water orientation combined with a high concentration of commercial
uses limits hotel opportunity
•May be a limited opportunity to provide economy hotel
61
06-11579.03
SUMMARY AND NEXT STEPS
62
06-11579.03
SUMMARY OF MAJOR CONCLUSIONS
The current economic crisis will pass – now is the time for the CRA
to get in position for the next upturn
New Smyrna Beach CRA is well-positioned from a market
perspective to capture demand
However, the CRA has been losing market share to other areas in
New Smyrna Beach
Each of the districts offers its own unique strengths and challenges
• Can support more than one orientation in the CRA
• Not competitive, but complementary
63
06-11579.03
NEXT STEPS
Case Studies of Select Redevelopment Areas
• Hollywood, Florida
• Delray Beach, Florida
• Bradenton, Florida
• Probe incentives used in Florida CRAs
On four selected sites in the CRA, RCLCO to provide:
• Timing
• Market audiences
• Absorption
• Pricing/positioning
• Residual land values
64
06-11579.03
CRITICAL ASSUMPTIONS
The conclusions and recommendations presented in this report are based on our analysis of the information available to us
from our own sources and from the client as of the date of this report. We assume that the information is correct, complete,
and reliable.
Our conclusions and recommendations are based on certain assumptions about the future performance of the global,
national, and/or local economy and real estate market, and on other factors similarly outside either our control or that of the
client. We analyzed trends and the information available to us in drawing conclusions and making the appropriate
recommendations. However, given the fluid and dynamic nature of the economy and real estate markets, it is critical to
monitor the economy and markets continuously and to revisit the aforementioned conclusions and recommendations
periodically to ensure that they stand the test of time.
We assume that, in the future, the economy and real estate markets will grow at a stable and moderate rate. However,
history tells us that stable and moderate growth patterns are not sustainable over extended periods of time. Indeed, we find
that the economy is cyclical and that the real estate markets are typically highly sensitive to business cycles. Our analysis
does not necessarily take into account the potential impact of major economic "shocks" on the national and/or local
economy and does not necessarily account for the potential benefits from a major "boom." Similarly, the analysis does not
necessarily reflect the residual impact on the real estate market and the competitive environment of such a shock or boom.
The future is always difficult to predict, particularly given changing consumer and market psychology. Therefore, we
recommend the close monitoring of the economy and the marketplace. The project and investment economics should be
“stress tested” to ensure that potential fluctuations in the economy and real estate market conditions will not cause failure.
In addition, we assume that economic, employment, and household growth will occur more or less in accordance with
current expectations, along with other forecasts of trends and demographic and economic patterns. Along these lines, we
are not taking into account any major shifts in the level of consumer confidence; in the cost of development and
construction; in tax laws (i.e., property and income tax rates, deductibility of mortgage interest, and so forth); or in the
availability and/or cost of capital and mortgage financing for real estate developers, owners, and buyers. Should any of the
above change, this analysis should probably be updated, with the conclusions and recommendations summarized herein
reviewed accordingly (and possibly revised).
We also assume that competitive projects will be developed as planned (active and future) and that a reasonable stream of
supply offerings will satisfy real estate demand. Finally, we assume that major public works projects occur and are
completed as planned.
65
06-11579.03
GENERAL LIMITING CONDITIONS
Reasonable efforts have been made to ensure that the data contained in this study reflect accurate and timely
information and are believed to be reliable. This study is based on estimates, assumptions, and other information
developed by RCLCO from its independent research effort, general knowledge of the industry, and consultations with
the client and its representatives. No responsibility is assumed for inaccuracies in reporting by the client, its agent, and
representatives or in any other data source used in preparing or presenting this study. This report is based on
information that to our knowledge was current as of the date of this report, and RCLCO has not undertaken any update
of its research effort since such date.
Our report may contain prospective financial information, estimates, or opinions that represent our view of reasonable
expectations at a particular time, but such information, estimates, or opinions are not offered as predictions or
assurances that a particular level of income or profit will be achieved, that particular events will occur, or that a
particular price will be offered or accepted. Actual results achieved during the period covered by our prospective
financial analysis may vary from those described in our report, and the variations may be material. Therefore, no
warranty or representation is made by RCLCO that any of the projected values or results contained in this study will be
achieved.
Possession of this study does not carry with it the right of publication thereof or to use the name of "Robert Charles
Lesser & Co." or "RCLCO" in any manner without first obtaining the prior written consent of RCLCO. No abstracting,
excerpting, or summarization of this study may be made without first obtaining the prior written consent of RCLCO.
This report is not to be used in conjunction with any public or private offering of securities or other similar purpose
where it may be relied upon to any degree by any person other than the client without first obtaining the prior written
consent of RCLCO. This study may not be used for any purpose other than that for which it is prepared or for which
prior written consent has first been obtained from RCLCO.
66
06-11579.03
THE CURRENT HOUSING DOWNTURN HAS SEEN A MORE SIGNIFICANT DECREASE
IN INFLATION-ADJUSTED HOME PRICES THAN IN THE EARLY ’80S & ’90S; NOMINAL
HOME PRICES HAVE BEGUN TO FALL FOR THE FIRST TIME SINCE 1975
Annual U.S. Home Prices
1975 – Q2 2008
$300,000
Median Home Price ($)
$250,000
$200,000
$150,000
-10.2%
-9.9%
-25.3%
$100,000
$50,000
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
1985
1984
1983
1982
1981
1980
1979
1978
1977
1976
1975
$0
Year
Nominal Median Home Prices
Inflation-Adjusted Median Home Prices
SOURCE: U.S. Census
67
06-11579.03
WHILE GROWTH IS EXPECTED TO BE SLOW ACROSS THE STATE FOR
THE NEXT TWO YEARS, NORTHEAST FLORIDA IS PROJECTED TO
RECEIVE A GREATER SHARE OF THE POPULATION GROWTH
Northeast Florida and Florida Population Growth and Northeast Florida as a Percent of
Florida Population Growth
2001-2025
NE Florida Population Growth
Florida Population Growth
NE Florida as a % of Florida
2025
2024
2023
2022
0.00%
2021
0
2020
2.00%
2019
50,000
2018
4.00%
2017
100,000
2016
6.00%
2015
150,000
2014
8.00%
2013
200,000
2012
10.00%
2011
250,000
2010
12.00%
2009
300,000
2008
14.00%
2007
350,000
2006
16.00%
2005
400,000
2004
18.00%
2003
450,000
2002
20.00%
2001
500,000
NOTE: Northeast Florida is defined as Nassau, Duval, Clay, St. Johns, Flagler and Volusia Counties.
SOURCE: BEBR
68
06-11579.03
FLORIDA’S PROJECTED GROWTH HAS SLOWED RECENTLY GIVEN
THE DOWNTURN, BUT FLORIDA IS STILL EXPECTED TO ADD AN
AVERAGE OF 830 RESIDENTS PER DAY THROUGH 2025
New Residents Per Day Moving to Florida
2006, 2007, 2008 Projections
2001 to 2025
1,400
1,200
1,000
800
600
400
200
SOURCE: BEBR
2006 Projections
2007 Projections
69
20
25
20
23
20
21
20
19
20
17
20
15
20
13
20
11
20
09
20
07
20
05
20
03
20
01
0
2008 Projections
06-11579.03
PERMITS CONTINUED TO FALL IN VOLUSIA IN 2008
Historical Permits and Permit Growth
Volusia County, Florida
1995-2008
8,000
60%
7,000
40%
6,000
20%
5,000
4,000
0%
3,000
-20%
2,000
-40%
1,000
-60%
0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Volusia County
Change in Total Permits
SOURCE: SOCDS
70
06-11579.03
VOLUSIA’S TOTAL HOME SALES 57% OFF 2005 PACE
AVERAGE SALES PRICE DECLINED BY 20% FROM PEAK IN 2007
Total Home Sales and Average Price
Volusia County, 2004–2008
16,000
$300,000
$250,000
12,000
$200,000
10,000
8,000
$150,000
6,000
Price
Total Home Sales
14,000
$100,000
4,000
$50,000
2,000
0
$0
2004
2005
2006
Total Home Sales
SOURCE:
2007
2008
Average Price
Volusia County Property Appraiser
71
06-11579.03
NEW SMYRNA BEACH TOTAL HOMES SALES HAVE BEEN RELATIVELY
STABLE
SINGLE-FAMILY HOME SALES HAVE DROPPED
Detached vs. Attached Home Sales in New Smyrna Beach
2002 to 2008
800
700
600
500
400
300
200
100
0
2002
2003
SOURCE: Volusia County Property Appraiser
2004
2005
Detached
72
2006
2007
2008
Attached
06-11579.03
MULTIFAMILY HOME SALES IN NEW SMYRNA BEACH ARE CAPTURING AN
INCREASING SHARE OF VOLUSIA COUNTY
New Smyrna Beach Single-Family vs. Multifamily Capture of Volusia County Home Sales
2002 to 2008
30%
25%
20%
15%
10%
5%
0%
2002
2003
2004
2005
2006
2007
2008
New Smyrna Beach Capture of Volusia County Single-Family Home Sales
New Smyrna Beach Capture of Volusia County Multifamily Home Sales
SOURCE: Volusia County Property Appraiser
73
06-11579.03
BUILDING PERMITS HAVE EXPERIENCED A SIGNIFICANT DROP SINCE 2003;
MULTIFAMILY BUILDING PERMITS CURRENTLY CAPTURING THE MAJORITY
OF BUILDING PERMITS IN VOLUSIA COUNTY
Single-Family vs. Multifamily Building Permits in New Smyrna Beach
1998 to 2008
500
60%
55%
450
50%
400
45%
350
40%
300
35%
30%
250
25%
200
20%
150
15%
100
10%
50
5%
0
0%
1998
1999
2000
2001
2002
2003
Single-Family Permits
Percent Capture of Volusia County Single-Family Permits
2004
2005
2006
2007
2008
Multifamily Permits
Percent Capture of Volusia County Multifamily Permits
SOURCE: Department of Housing and Urban Development
74
06-11579.03
RETIREES ARE ALSO PROJECTED TO BE A LARGE PART OF PRIMARY
HOUSEHOLD GROWTH OVER THE NEXT FIVE YEARS
HOUSEHOLDS1
'08-'13
'08-'13
GROWTH
MARKET
2008
2013
ANN.
GROWTH
AS A % OF
GROWTH
ESTIMATE
PROJ.
GROWTH
RATE
AREA
OPPORTUNITY2
Total Households
8,045
8,545
100
1.2%
-
Singles/Couples/Starter
Families
1,095
1,095
0
0.0%
0.0%
0.00
950
1,016
13
1.4%
13.2%
1.12
1,220
1,168
-10
-0.9%
-10.4%
-0.69
1,378
1,423
9
0.6%
9.0%
0.53
3,402
3,843
88
2.5%
88.2%
2.09
MARKET SEGMENT
(HEAD OF HH AGE RANGE)
(Under 35)
Growing Families
(35-44)
Mature Families
(45-54)
Empty-Nester/Pre-Retirees
(55-64)
Retirees
(65-74)
1
Within a three-mile radius drawn from the intersection of Riverside Drive and North Causeway
Market growth opportunity is calculated by dividing the percent share of total households of a particular age group by the share of growth
projected within the corresponding particular age group; above 1.0 indicates the segment is achieving more than its fair share of growth.
SOURCE: Claritas; RCLCO
2
75
06-11579.03
ESTIMATED DEMAND FOR RENTAL AND FOR-SALE
HOMES IN NEW SMYRNA BEACH
1990 - 2000
2000 - 2008
2008-2013
2014 - 20183
1,239
1,250
836
974
Annual Household Growth
124
156
167
195
Estimated Percent Rent 1
25%
25%
25%
25%
Estimated Annual New Renter
Households
31
39
42
49
Estimated Annual New Owner
Households
93
117
125
146
Annual Demand For Second
Homes 2
146
116
75
116
Total Annual New Owner Homes
239
233
200
262
Household Growth 1
1
Claritas Inc. for 1990, 2000, 2008, 2013. 2018 RCLCO estimate based upon growth in annual household growth from 1990.
2
1990 to 2008 from Census. 2008-2013 based upon growth in second homes in New Smyrna Beach 2000-2008,
with a 36% drop based upon overbuilding during that time period.
3
2014 - 2018 based upon 2000-2008 time period.
SOURCE: Department of Housing and Urban Development, US Census, Claritas, RCLCO
76
06-11579.03
SINCE 1991, NEW SMYRNA BEACH AHS AVERAGED ~20,000 SQUARE
FEET OF ADDITIONAL RETAIL SPACE PER YEAR
Total Retail Square Feet vs. Annual New Square Feet of Retail in New Smyrna Beach
1991 to 2008
Home Depot
completed
110,000
1,300,000
1,200,000
100,000
1,100,000
90,000
1,000,000
80,000
900,000
70,000
800,000
60,000
700,000
50,000
600,000
500,000
40,000
400,000
30,000
300,000
20,000
200,000
10,000
100,000
0
0
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Total New Retail Square Feet per Year
SOURCE: Volusia County Property Appraiser, RCLCO
77
2001
2002
2003
2004
2005
2006
2007
2008
Total Retail Square Feet per Year
06-11579.03
THE CRA HAS INCREASED ITS RETAIL SQUARE FOOTAGE BY ~50,000
SQUARE FEET SINCE 1991; NEW RETAIL DEVELOPMENT WILL MOST
LIKELY COME IN THE FORM OF REDEVELOPMENT
CRA Percent Capture of Retail in New Smyrna Beach vs. Total Retail in CRA
1991 to 2008
40%
380,000
35%
370,000
30%
360,000
25%
350,000
20%
340,000
15%
330,000
10%
320,000
5%
310,000
0%
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Total CRA Retail Square Feet per Year
SOURCE: Volusia County Property Appraiser, RCLCO
2001
2002
2003
2004
2005
2006
2007
2008
CRA Percent Capture of New Smyrna Beach Retail
78
06-11579.03
US-1 AND A1A ACHIEVE THE HIGHEST TRAFFIC COUNTS WITHIN THE
CRA; STRONG FOR RESIDENTIAL, CANAL, AND THIRD AVENUE
DISTRICTS
Average Annual Daily Traffic Counts
2007
8,900
24,500
27,500
31,000
16,700
14,900
20,200
25,500
29,000
Subject Area
SOURCE: Florida Department of Transportation, RCLCO
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SUMMARY OF POTENTIAL RETAIL DEMAND IN THE NEW
SMYRNA BEACH CRA
550,000
500,000
450,000
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
2008
2013
Estimated SF Supported From HH
Estimated SF Supported From Tourists
2018
Estimated SF Supported From Employees
SOURCE: US Census Bureau; Claritas, Inc, Dollars and Cents, Shopping Center Directory; Visit Florida, Daytona Beach
Convention and Visitors Bureau, RCLCO
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NEW OFFICE SPACE IN NEW SMYRNA BEACH HAS BEEN LIMITED;
SINCE 1991, NEW SMYRNA BEACH HAS AVERAGED ~5,300 SQUARE
FEET OF ADDITIONAL OFFICE SPACE PER YEAR
Total Office Square Feet vs. Annual New Square Feet of Office in New Smyrna Beach
1991 to 2008
Office portion of Tuscany Square
Town Center at Venetian Bay
completed
30,000
400,000
350,000
25,000
300,000
20,000
250,000
200,000
15,000
150,000
10,000
100,000
5,000
50,000
0
0
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Total New Office Square Feet per Year
2001
2002
2003
2004
2005
2006
2007
2008
Total Office Square Feet per Year
SOURCE: Volusia County Property Appraiser, RCLCO
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ALTHOUGH LOSING SHARE TO OTHER AREAS SUCH AS VENETIAN
BAY, NEW SMYRNA BEACH OFFICE SPACE IS PRIMARILY
CONCENTRATED IN THE CRA
CRA Percent Capture of Office in New Smyrna Beach vs. Total Office in CRA
1991 to 2008
200,000
60%
180,000
58%
160,000
140,000
56%
120,000
100,000
80,000
54%
60,000
40,000
52%
20,000
0
50%
1991
1992
1993
1994
1995
1996
1997
1998
Total CRA Office SF per Year
SOURCE: Volusia County Property Appraiser, RCLCO
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
CRA Percent Capture of New Smyrna Beach Office
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SUMMARY OF POTENTIAL NEW OFFICE DEMAND IN THE
NEW SMYRNA BEACH CRA IMPROVED
Year
Projected
Employment
Growth in Volusia
County1
Projected Total
New Office
Space2
Estimated CRA
Capture of New
Office Space
Improved 8
Estimated
Occupancy in
CRA Improved4
Projected Demand
for New Office
Space in CRA
Improved5
2009
4,940
238,842
4,270
75%
3,758
2010
5,080
245,611
4,391
75%
3,864
2011
5,230
252,863
4,521
75%
3,979
2012
5,380
260,115
4,651
75%
4,093
2013
5,540
267,851
4,789
75%
4,214
2014
5,700
275,587
4,927
75%
4,336
2015
5,860
283,323
5,066
75%
4,458
2016
6,039
291,977
5,220
75%
4,594
2017
3,808
184,090
3,291
75%
2,896
2018
3,875
187,361
3,350
75%
2,948
2019
3,944
190,690
3,409
75%
3,000
TOTAL
55,396
2,678,309
47,887
75%
42,141
1 Based
on Florida Labor Market Statistics and historical average growth in employment
Based on demonstrated new office space per new job in Volusia County
3 As-is scenario based on the average historical capture of new Volusia County office space in the New Smyrna CRA without the 1993 outlier
4 Based on broker conversations
5 Projected by multiplying the estimated current occupancy with the estimated capture of new office space within the CRA
6 Based on a 10% increase in the capture of projected Volusia County office space
SOURCE: Florida Labor Market Statistics, Volusia County Property Appraiser Data, RCLCO
2
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SUMMARY OF POTENTIAL NEW OFFICE DEMAND IN THE
NEW SMYRNA BEACH CRA AS-IS
Year
Projected
Employment
Growth in Volusia
County1
Projected Total
New Office
Space2
Estimated CRA
Capture of New
Office Space As-Is 3
Estimated
Occupancy in
CRA As-Is4
Projected Demand
for New Office
Space in CRA As-Is5
2009
4,940
238,842
4,270
75%
3,203
2010
5,080
245,611
4,391
75%
3,294
2011
5,230
252,863
4,521
75%
3,391
2012
5,380
260,115
4,651
75%
3,488
2013
5,540
267,851
4,789
75%
3,592
2014
5,700
275,587
4,927
75%
3,696
2015
5,860
283,323
5,066
75%
3,799
2016
6,039
291,977
5,220
75%
3,915
2017
3,808
184,090
3,291
75%
2,469
2018
3,875
187,361
3,350
75%
2,512
2019
3,944
190,690
3,409
75%
2,557
TOTAL
55,396
2,678,309
47,887
75%
35,915
1 Based
on Florida Labor Market Statistics and historical average growth in employment
Based on demonstrated new office space per new job in Volusia County
3 As-is scenario based on the average historical capture of new Volusia County office space in the New Smyrna CRA without the 1993 outlier
4 Based on broker conversations
5 Projected by multiplying the estimated current occupancy with the estimated capture of new office space within the CRA
SOURCE: Florida Labor Market Statistics, Volusia County Property Appraiser Data, RCLCO
2
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BY 2019, THERE WILL BE AN ESTIMATED 400 ADDITIONAL
SUPPORTABLE HOTEL ROOMS WITHIN NEW SMYRNA BEACH
Estimated Supportable Hotel Rooms
2009 to 2019
400
375
350
325
300
275
250
225
200
175
150
125
100
75
50
25
0
2008-09
Est.
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
SOURCE: Volusia County Property Appraiser, RCLCO
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