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metroedge.lisc.org

Westhaven Market Study

November 5th, 2007

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Today’s Agenda

• Demographic Trends and Market Conditions

• Assets and Opportunities in Westhaven

• Strategies for Sustaining Homeownership and Supporting New Retail

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Westhaven Rising Like a Phoenix!

A neighborhood with significantly increasing development activity principally moving in from the east, strong civic institutions and vibrant neighborhood assets – increasingly a community of choice!

Yet, the impact of recent economic trends on homeownership provides a new challenge to the investors and residents of Westhaven.

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Trade Area Highlights

• Demographics in Westhaven are changing

• New residential, most particularly homeownership, has increased in the community

• Private investment and construction activity demonstrates growth including new retail

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Westhaven Convenience Trade Area

Railroad tracks are a natural boundary in attracting consumers for retail trade in an area.

The Eisenhower Expressway presents a boundary in defining the trade area.

Trade Area: Geography defined by physical and/or sociological boundaries that determines the target market for the retail types evaluated for a specific site or retail corridor. This area often differs from political, community, or service area boundaries.

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The Hub --Businesses and Institutions

Taking advantage of opportunities:All-Star Dental moved into 5,000 square foot of space next to the Walgreen’s at Madison and Western.

Next Goal:

Identify strategies for supporting new retail.

Madison and Western is two miles west of the Chicago Loop, with close-by connections to highways, rail lines and busses, including Chicago’s second busiest bus route with 23,000 riders daily!

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Also in Westhaven……

• Chicago Landmarks: Frank Lloyd Wright’s Waller Apartments & Metropolitan Missionary Baptist Church

• Kinzie Industrial Corridor a few blocks to the north

• Recently renovated Touhy-Herbert Park, featuring community baseball program

The Hub -- Businesses and Institutions• Madison and Western features the

historic West Town State Bank Building on the northwest corner, home to the first black radio station in the 1930’s and 1940’s, now converted to one- and two- bedroom apartments.

• Critical retail opportunity – an organic bakery signed to occupy ground floor.

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The Fundamentals• Near West Side CDC and its partners have

successfully brought new investments to Westhaven focusing most recently on new homes.

• The United Center has invested $600,000 in a Construction Escrow Account which Near West Side CDC has used to finance multiple residential development projects in the neighborhood.

• Strong public sector investment includes the Chicago Housing Authority’s transformation of the Horner and Rockwell sites, as well as the Mabel Manning Public Library.

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The Fundamentals

• Partnerships such as the $1.5 million United Center Community Economic Development Fund (UCCEDF) have mobilized new resources for development in Westhaven.

– Fourteen businesses have been funded by the UCCEDF

– 100% of these businesses established business residency in the community and/or expanded their existing facility/operations within the community.

– A total of 126 jobs were created or sustained

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Sustaining Westhaven’s Success

• Engaging partners in building on and sustaining their investments in the community

• Using data such as LISC MetroEdge’s profile to focus the effort to identify and support convenience retail

• Continue to support the completion and sales of homeownership

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Westhaven Today

–Demographic Trends

–Market Conditions

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A trade area with increasing wealth!

The number of upper middle income households – a key demographic needed to support retail development –has nearly tripled in the last fifteen years.

Middle to Upper

Income HHs 1990

Middle to Upper

Income HHs 2000

Middle to Upper

Income HHs 2006

Trade Area 247 637 668

County 1,334,362 1,345,704 1,306,184

Change 1990 - 2000 Change 2000 - 2006 Change 1990 - 2006

Trade Area 158.4% 4.8% 170.7%

County 0.8% -2.9% -2.1%

Middle to Upper Income Households per Square Mile

1381

1034

0

200

400

600

800

1000

1200

1400

1600

County Trade Area

Source: Claritas 2005, LISC MetroEdge metrics

(Household Income 35K and above)

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Good Buying Power

Concentrated Buying Power(Millions of Dollars per Square Mile)

$91.1$81.3

0

10

20

30

40

50

60

70

80

90

100

County Trade Area

County

Trade Area

Source: Claritas 2005, LISC MetroEdge metrics

There are 90 million dollars of concentrated buying power in the trade area, which is 10 million more dollars to spend than a comparable square mile county wide.

Definition:Potential dollars available to be spent in retail stores by trade area residents per square mile.

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Private Investments Surrounds Westhaven

Real estate investments are moving across the city, enhancingconditions favorable for the development of new retail.

Source: City of Chicago Building Permits 2006, LISC MetroEdge metrics

Madison & Western

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Recent Developments Bring New Residents

• Over a half billion dollars in new investments in residential and commercial development since 1999, translating to:

– 2,000 total new residential units already online or under construction

– Anchored by public housing transformation and private investments

• New homeownerships opportunities cover the neighborhood, many occupied by new residents, others continue to be available.

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Household Income Diversity

Household Annual Income Distribution

51%

15%9% 8% 6% 4% 7%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

Less than

$15,000

$15,000 to

$24,999

$25,000 to

$34,999

$35,000 to

$50,000

$50,000 to

$75,000

$75,000 to

$100,000

$100,000 plus

Fra

ction of House

holds

Source: Claritas 2005, LISC MetroEdge metrics

Income diversity has increased in Westhaven, with 25% of the population in the middle and upper income categories.

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Increasing homeownership to support retail

New Purchase Loans, 1995-2005

10

30

15 14

51

32 35

57

105

148

125

0

20

40

60

80

100

120

140

160

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Count loans

Trade Area Loans

Source: Home Mortgage Disclosure Act 1995-2005,

LISC MetroEdge metrics

The trade area shows increasing home purchase activity.

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2000 Household Annual Income Distribution of Homeowners

21%

11% 10%

15%

24%

12%

8%

0%

5%

10%

15%

20%

25%

Less than

$15,000

$15,000 to

$24,999

$25,000 to

$34,999

$35,000 to

$50,000

$50,000 to

$75,000

$75,000 to

$100,000

$100,000 plus

Fra

ction of House

holds

Source: Geolytics Census 2000 Income by Tenure, LISC MetroEdge metrics

Sixty percent of homeowners are middle and upper middle income households.

Income Diversity of Homeowners

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Strong Building Permit ActivityNew Construction Permits per 1,000 Households

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30

5

10

15

20

25

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City Trade Area

City

Trade Area

Source: City of Chicago Building Permits 2005, LISC MetroEdge metrics

The trade area includes 27 new construction permits per 1,000 households!

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Active Renovation and Repair InvestmentsRepair/Renovation Permits per 1,000 Households

1719

0

10

20

30

City Trade Area

City

Trade Area

Source: City of Chicago Building Permits 2005, LISC MetroEdge metrics

New repair and renovation permits represent investments in improving the community.

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Opportunities for New Home Construction

Demolition Permits per 1,000 Households

1.6

3.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

City Trade Area

City

Trade Area

Source: City of Chicago Building Permits 2005, LISC MetroEdge metrics

The demolition of outdated housing stock in the trade area creates space for the future of Westhaven.

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The Next Horizon

Population 1990 Population 2000 Population 2006

Trade Area 9,852 8,197 7,841

County 5,105,067 5,376,741 5,306,935

Change 1990 - 2000 Change 2000 - 2006 Change 1990 - 2006

Trade Area -16.8% -4.3% -20.4%

County 5.3% -1.3% 4.0%

• Recent and future investments in homeownership will provide a consistent population base to support retail for the Westhaven, reversing recent trends.

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Potential Neighborhood Convenience Retail

Many businesses already operate in Westhaven, providing a base of existing retail institutions to build from.

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Retail Opportunity in Numbers!

The trade area presents opportunities for retailers in the general merchandise and clothing store categories.

0172-26,995,021-26,929,20436,403,4069,474,202Motor Vehicle & Parts Dealers

0462-4,910,818-4,908,71511,066,1906,157,475Foodservice & Drinking Places

0232-2,324,995-2,189,0943,428,0541,238,960Miscellaneous Store Retailers

23,5753418,038,9958,309,135383,0278,692,162General Merchandise Stores

771370285,423760,556337,9141,098,470

Sporting Goods, Hobby, Book, &

Music Stores

11,1543123,479,9543,481,16603,481,166Clothing & Clothing Accessories Stores

N/AN/A1,051,8242,412,7124,037,9446,450,656Gasoline Stations

0474-7,377,039-7,074,66011,189,1254,114,465Health & Personal Care Stores

0245-2,825,897-1,469,89511,255,2909,785,395Food & Beverage Stores

0219-6,819,248-6,155,8689,943,6483,787,780Building Material, Garden Equipment & Supply Dealers

0452-810,855-424,5591,887,8831,463,324Electronics & Appliance Stores

0352-2,816,673-2,043,2053,388,0461,344,841

Furniture & Home Furnishings

Stores

Estimated Square

Footage

Sales Per Square

Foot

Adjusted

FloatFloatSupplyDemandCategory

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10.330.370.140.000.14Other Telecommunications

2.770.590.220.000.22

Carpet and Upholstery

Cleaning Services

1.780.640.240.000.24Locksmiths

8.730.740.280.000.28Janitorial Services

13.800.990.380.000.38

Cellular and Other Wireless

Telecommunications

6.441.010.380.000.38

Automotive Body, Paint,

and Interior Repair and

Maintenance

25.291.200.460.380.84

Offices of Certified Public

Accountants

11.421.270.480.000.48Architectural Services

GAPTrade AreaCounty

Employee

GAP

Additional

Potential for

Establishments

Establishments Per 1000

Households

Service Sector

New Service Businesses

To Complement New Retail

Service businesses are an important component of a good neighborhood convenience business strip.

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Ingredients for New Retail Development

• Homeownership growth has been the focus of investors, lenders, the CDC and developers in the past few years and it shows on the ground.

• CHA investments in Jackson Square at West End, the Villages of Westhaven and Westhaven Park are creating new neighborhood assets, increasing both density and income diversity.

• A series of new retail sites have been constructed following the opening of Walgreen’s seeking tenants such as “All Star Dental”.

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Westhaven Strategies for Sustaining Growth

• Implement comprehensive, coordinated strategies to support commercial development:

– Safety

– Cleanup & Beautification

– Streetscape Improvements

– Promotions & Marketing

– Financial Assistance

– Business Attraction

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Westhaven Strategies for Sustaining Growth

• Homeownership efforts need to be completed

– Every unit makes a difference

– Combined sales campaign in early spring

• Engage in partnerships to mobilize resources to support homeownership and commercial development strategies

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• Trade Area: Area that determines the target market for the retail types evaluated for a specific site or retail corridor. This area often differs from political, community, or service area boundaries.

• Concentration of Buying Power: Potential dollars available to be spent in retail stores by consumers who live the study area per square mile.

• Middle to Upper Income Households: Total number of households with annual household income above $35K.

• Retail Float: Measure of the amount of unmet retail opportunity in the study area, and is calculated as the difference between buying power (demand) and retail sales (supply).

• Adjusted Float: Adjusts float for the amount that is captured by establishments immediately outside of the target area. Adjusted Float is subtracted from overall Float.

Basic Definitions

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Trade Area Highlights

• Demographics in Westhaven are changing

• New residential, most particularly homeownership, has increased in the community

• Private investment and construction activity demonstrates growth including new retail