Market and Financial Feasibility
City of Mountain View/Charleston East Feasibility Study
While with Sedway Group I analyzed the market feasibility of hotel/conference center development on an 18.7-acre site owned by the City of Mountain View. Cultural and educational uses of the site were also considered. I also directed a subcontractor, Scott Hospitality Consultants, to determine the specific type of hotel/conference center that would likely be feasible on the site and the amount of land area necessary for such a development. A financial analysis of a prototype hotel/conference center was developed and evaluated to determine whether the product supported by the market would require any subsidy. The analysis confirmed both market and financial feasibility of the hotel/conference center and suggested that there would be residual site area to accommodate cultural and/or educational uses desired by the City. A survey of potential cultural/educational users was conducted to gauge interest in the site. Sedway Group prepared an RFQ to market the hotel/conference center portion of the site. We also worked with the City and another consultant, LORD Cultural Resources, to refine the City’s criteria for cultural and educational uses prior to issuing an RFP to those users.
While with Sedway Group I was retained by Prime Pacific Global Management Corporation (PPGM) to conduct a highest and best use analysis for two San Mateo County properties with frontage along El Camino Real, one located in Burlingame, which is improved and occupied, and the other in Millbrae, which is essentially vacant. This study was the first of a multiphase assignment to assist PPGM in assessing alternative uses for these properties in light of strong real estate market conditions and, specific to the Burlingame site, the potential impact of the new Millbrae BART station and associated development. We evaluated the properties’ redevelopment potential through an analysis of site and neighborhood characteristics, government restrictions, and current and future market conditions, which concluded that both properties were candidates for redevelopment. The Millbrae site was successfully entitled and sold to Silverstone Development in 2005. Project sales began in 2008.
Santa Cruz Seaside Company/La Bahia Hotel Feasibility Analysis
Analyzed the financial feasibility of the proposed redevelopment of the historic La Bahia hotel, located near the Santa Cruz Beach Boardwalk in Santa Cruz. Sedway Group analyzed several concepts for the proposed hotel project, ranging from a boutique hotel to a high-end conference center. For each alternative, I calculated the relative feasibility, given differences in achievable room rates and construction costs. In addition, the amount of city subsidy was calculated for each scenario.
Eastlake Development Company/ Boston Ranch Market and Financial Feasibility Study
Performed a market and financial feasibility study for approximately 38,000 acres east of Visalia, California in the Central Valley of California, primarily used as grazing land. Given the long-term population and employment growth for the Central Valley, the Eastlake Company contracted CBRE Consulting to explore the potential for rezoning and developing the property into a predominantly residential master-planned community over the next several decades.
City of Huntington Beach/Downtown Retail and Hotel Feasibility Study
While with Sedway Group I analyzed the financial feasibility of a proposed mixed-use project consisting of 140,000 square feet of retail space and a 120-room hotel located in downtown Huntington Beach. The purpose of the analysis was to calculate the general feasibility of the proposed project and to determine if a subsidy would be required to make the project work. Sedway Group calculated the “gap” necessary for the developer to achieve its required return. In addition, we recommended alternative financing mechanisms for the public components of the project (i.e., parking garage and streetscape) to lower the development costs. Finally, we estimated the fiscal revenue to be generated by the project and compared this figure with the level of city subsidy previously calculated. This information was used to assist the City in its negotiations with the developer. The project (The Strand) opened in 2006.
While with Sedway Group conducted a study of the residential market in order to develop product, pricing, and amenity recommendations for a proposed apartment complex on Oakland’s waterfront. The study consisted of an identification and analysis of competitive Bay Area apartment projects, which included research on unit mix, pricing, amenities, and tenant profiles. Since the complex was proposed to be built to condominium specifications, Sedway Group also analyzed several for-sale multifamily projects in order to ensure the proposed complex would be competitive with regard to unit mix, size and amenities. Project was completed in the mid 90’s.
City of San Jose/Civic Operations Master Plan Phase I
While with Sedway Group I participated on a team of consultants to assist the City of San Jose with its efforts to satisfy future departmental space needs in a cost-effective manner. My role included analyzing real estate markets, identifying property impacts, providing cost estimates for land and building acquisition, and assessing reuse opportunities for existing structures. The team constructed a baseline analysis and four development scenarios addressing the city’s space needs over a 20-year period. Each scenario was subjected to a long-term financial analysis of costs and benefits to the city. The costs and benefits not only included the costs associated with the development of any new buildings (i.e., land and building acquisition, construction, etc.) but also operating expenses, lease expenses, moving costs, property tax implications, and potential savings from relinquishing leased space.
City of San Jose/Civic Operations Master Plan Phase II/Construction and Financing Alternatives
I continued work on a team of consultants assisting the City of San Jose with its long-range plans for a new civic center. One specific task for the project’s second phase involved researching construction and financing alternatives for the new civic center. The research regarding construction processes investigated alternatives to the traditional design-bid-build method. The investigation into financing alternatives looked at financing methods other than general obligation bonds. The task included surveying other civic projects in California and around the nation with respect to design and construction processes and financing methods used, consideration of other options and experience with the selected methods.
Transaction (TA) Development/Berkeley
While with Sedway Group I conducted an analysis of market area rents, vacancies unit mixes, and sizes at higher-density apartment projects in the East Bay and other selected Bay Area locations. We also collected information regarding planned and proposed multifamily projects in Berkeley. The purposes of the study were to recommend an optimal unit mix and determine likely rent levels at a high-quality apartment project located in downtown Berkeley near BART and the University of California at Berkeley.
City of Lafayette/Market Assessment of Proposed Downtown Retail Development
Prepared an analysis of the retail market opportunities for a 3.86-acre site located in downtown Lafayette, adjacent to the BART station. We analyzed the potential for retail development at the entire site in light of the existing retail competitive environment, trends and supply within the Lafayette and Lamorinda areas. Recommendations for a variety of retail development alternatives were included in the study, as well as survey results of potential retailers.
Lend Lease Development/Piers 30-32
While with Sedway Group performed a market analysis of retail development on Piers 30-32, a proposed cruise ship terminal on the San Francisco waterfront. The analysis included an investigation of market demographics and spending patterns, case studies on successful retail developments, and retail demand assessments of specific retail categories, including live entertainment venues, restaurants, other entertainment-oriented retail, bookstores, homewares, a fitness center, a drug store, a grocery store, and an art cinema. The analysis was used to help the developer formulate its retail strategy and tenant mix for this high-profile, waterfront property.
Bay Area Rapid Transit District/El Cerrito Plaza Financial Feasibility Evaluation
For a proposed 184-unit apartment project in El Cerrito, reviewed three development pro formas to determine reasonableness of the assumptions and overall financial feasibility. The three scenarios included a 100 percent affordable, a 40 percent affordable, and a 20 percent affordable apartment project financed with varying levels of tax credit funding. The due diligence analysis included a survey of local rental rates, estimation of high-density construction costs, and calculation of the “feasibility gap” between several different scenarios.
When a 30,000-square-foot parcel adjacent to the Central Branch of the Berkeley YMCA was foreclosed on by the Bank of America, the YMCA recognized a once-in-a-lifetime opportunity to expand. I advised the YMCA on negotiation of the acquisition from the bank’s REO department, assisted the YMCA in defining its long-term facility needs, and aided in soliciting and selecting a developer/joint venture partner. This effort included preparing a Request for Proposal, evaluating four developer proposals, and negotiating the transaction with the selected developer. This transaction was very complex in that it included a sale of land, a sale of air rights, and a joint design and development agreement between the parties. I managed the project through the city approvals and environmental review process (securing 9-0 vote); and wrote the market and financial feasibility study that was included in the Prospectus for a $10 million tax exempt bond which financed the new Downtown YMCA.
While with Sedway Group conducted a market analysis of various future uses for East Fort Baker, a site within the Golden Gate National Recreation Area. East Fort Baker, a 250-acre site with numerous historic buildings, was scheduled to be transferred from the U.S. Army to the National Park Service by the year 2000. Reuse options and themes that Sedway Group investigated included a conference/retreat center, children’s educational and recreational facilities, and art and cultural uses. The project, now called Cavallo Point, opened in 2007.
San Francisco Partnership/San Francisco Hotel Market Analysis
While with Sedway Group I assisted the San Francisco Partnership in evaluating the market for high-end (five-star) hotels in the City of San Francisco. Our assignment included an analysis of existing hotel occupancies, average daily rates, locations, and amenities, as well as research into planned and proposed hotel development. The analysis was conducted as part of the San Francisco Partnership’s assessment of the adequacy of existing and proposed hotel inventory to serve market demand for five-star hotels. Our findings indicated that San Francisco could readily absorb additional hotel units targeted toward this market niche, and an increase in this under-supplied market could assist the City in its overall reputation as a high-end tourist and business destination.
DeBartolo Entertainment/Candlestick Mills – 49ers Stadium Market Study
While with Sedway Group I conducted a market study of the proposed 1.4-million-square-foot Candlestick Mills project, including a megaplex theater project, to be located adjacent to a new 75,000-seat 49ers football stadium in San Francisco’s Candlestick Point. The market study included an analysis of the performance of existing Mills Centers around the country and their impact on surrounding retail centers. The study also evaluated the Candlestick Mills likely impact on existing San Francisco retail, as well as the anticipated sales volume. Further, Sedway Group projected the retail center’s ability to generate tax increment revenue to cover the debt payments associated with the lease revenue bonds.
While with Sedway Group I directed an analysis of the market potential for office, R&D, light industrial, retail, hotel/conference center, golf course, recreation, and residential uses to assist in the reuse planning efforts for this major former Army base near Monterey, California. The plan developed as a result of this planning effort received an American Planning Association award.
Georgia Pacific/Fort Bragg, California Mill Site/Highest and Best Use Analysis/Disposition Strategy
While with CBRE Consulting organized a multi-disciplinary planning team (chosen from a half dozen competing teams) to conduct a Highest and Best Use Analysis and recommended a master planning approach and disposition strategy for this 400 acre former mill site on the Mendocino County coast of Northern California.