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LOCiMarket Analysis for Downtown Redevelopment <br />CONSULTING City of Centerville Economic Development Authority <br />April 3, 2023 <br />7. Findings and Recommendations <br />This section summarizes the demand calculations <br />for for -sale condominium and townhome units, <br />market -rate and affordable rental housing units, and <br />senior housing along with retail space demand in <br />Downtown Centerville. Detailed demand <br />calculations are included in the Appendix that <br />follows this section. This section also makes <br />recommendations based on this overall analysis. <br />One key finding that stands out from this analysis is <br />the large amount of residential demand relative to <br />the much smaller amount of commercial space <br />demand. This disparity can be explained by a <br />number of factors. First, housing demand has been <br />particularly strong in the last five years as <br />millennials have moved into their prime <br />homebuying years following several years of lower <br />residential production. Developers have also had to <br />catch up with rental housing demand as younger <br />generations waited longer to form households and <br />struggled with higher homeownership costs. These <br />factors led to increased demand across the housing <br />spectrum. <br />Meanwhile, commercial space demand has slowed, <br />especially in retail and, more recently, office. Both <br />real estate types have seen slower rent growth in <br />recent years, meaningless demand for new <br />development. Lastly, unlike housing, commercial <br />development at Downtown Centerville faces <br />significant competition from commercial nodes with <br />higher traffic counts and better access to freeways <br />and key transportation corridors. These areas will <br />always be more attractive to national and regional <br />retailers and the small homegrown businesses from <br />the area. <br />Residential Demand Estimates <br />Figures 7.1 through 7.3 show summaries of the <br />residential demand calculations in the Appendix. <br />Although some of the demand calculations provide <br />for point estimates, data in the summary is provided <br />as a range of units. <br />The analysis shows that there is housing demand <br />across almost all housing types. <br />Note that for the most part, the demand forecasts <br />are mutually exclusive, meaning there is little <br />overlap between demand for different product <br />types. Where there is overlap, it is noted. <br />For -Sale Condominiums and Townhomes <br />■ Figure 7.1 shows the summary of the demand <br />calculations for for -sale condominiums and <br />townhomes in Downtown Centerville. We find <br />demand for between 45 and 90 units between <br />2022 and 2027. <br />■ This demand is driven by younger first-time <br />homebuyers who tend to be more price sensitive <br />and empty nesters, move -up homebuyers looking <br />for association -maintained, single -level housing <br />options. <br />■ We believe that most of this demand would be for <br />multilevel townhomes priced between $350,000 <br />and $450,000, targeted to younger professionals <br />with and without children looking to live in an <br />association -maintained home in a suburban <br />downtown district. <br />However, there is also some demand potential for <br />condominium units in an apartment -style <br />building. This product type would work best <br />positioned to capitalize on access and visibility to <br />Centerville Lake. (This product style would also <br />overlap with some of the age -restricted for -sale <br />product discussed later.) <br />Rental Housing <br />Page 186 <br />Figure 7.2 shows the summary of demand for <br />rental housing in Downtown Centerville between <br />2022 and 2027. The analysis found demand for <br />between 115 and 140 units of rental housing <br />targeted to households with incomes less than <br />60% of Area Median Income ($63,360). This <br />income threshold is based on income limits set for <br />