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Comprehensive Housing Market Analysis for the

University District Minneapolis, Minnesota

Prepared for:

The University District Alliance Minneapolis, Minnesota February 2011

615 First Avenue NE Suite 400 Minneapolis, MN 55413 612.338.0012

February 8, 2011 Mr. Kris Nelson Mr. Richard Gilyard CURA Pro Forma Committee Chair 330 HHH Center University District Alliance 301 19th Avenue South 100 Church Street SE #3 Minneapolis, MN 55455 Minneapolis, MN 55455 Dear Messrs. Gilyard and Nelson: Attached is the Comprehensive Housing Market Analysis for the University District conducted by Maxfield Research Inc. The study projects housing demand through 2020 and gives recom-mendations on the amount and type of housing that could be built in the University District to satisfy demand in the short-term. Detailed information regarding recommended housing con-cepts can be found in the Conclusions and Recommendations section at the end of the report. We have enjoyed performing this study for you and are available should you have any questions or need additional information. Sincerely, MAXFIELD RESEARCH INC.

Matt Mullins Vice President Attachment

TABLE OF CONTENTS Page KEY FINDINGS ................................................................................................................ 1 PURPOSE AND SCOPE ................................................................................................... 7 Purpose and Scope .......................................................................................................... 7 Methodology ................................................................................................................... 7 Acknowledgements ......................................................................................................... 8 DEMOGRAPHIC ANALYSIS ......................................................................................... 9 Introduction ..................................................................................................................... 9 Population and Household Growth Trends and Projections ........................................... 9 Age Distribution .............................................................................................................. 13 Household Size ............................................................................................................... 16 Household Type .............................................................................................................. 17 Household Income ........................................................................................................... 18 Tenure .............................................................................................................................. 25 Tenure by Income ............................................................................................................ 26 Tenure by Age of Householder ........................................................................................ 28 Consumer Profile ............................................................................................................. 30 Demographic Summary ................................................................................................... 33 HOUSING CHARACTERISTICS ................................................................................... 34 Introduction ..................................................................................................................... 34 Age of Housing Stock ..................................................................................................... 34 Housing Stock by Structure Type ................................................................................... 36 Residential Construction Trends in the University District ............................................ 38 Assessed Value of Housing Units ................................................................................... 41 Relative Homestead Status .............................................................................................. 43 Neighborhood Staff Interviews ....................................................................................... 44 FOR-SALE MARKET ANALYSIS ................................................................................. 48 Introduction ..................................................................................................................... 48 Home Resales .................................................................................................................. 48 Current Supply of Homes on the Market ........................................................................ 53 Actively Marketing & Recently Completed For-Sale Multifamily Housing

Developments in the University District ......................................................................... 55 For-Sale Interviews Summary......................................................................................... 58

TABLE OF CONTENTS (continued)

Page RENTAL MARKET ANALYSIS ..................................................................................... 60 Introduction ..................................................................................................................... 60 Overall Minneapolis Market Conditions ......................................................................... 60 Market Rate Properties .................................................................................................... 61 Student Oriented Properties ............................................................................................ 70 Affordable Properties ...................................................................................................... 73 Subsidized Properties ...................................................................................................... 74 SENIOR HOUSING ANALYSIS ..................................................................................... 77 Senior Housing Defined .................................................................................................. 77 Market Rate Senior Housing in the University District .................................................. 78 Market Rate Senior Housing in other Minneapolis Neighborhoods ............................... 78 Affordable and Subsidized Senior Housing .................................................................... 80 Senior Housing Near Comparable University Campus .................................................. 83 PLANNED AND PENDING SUMMARY ....................................................................... 89 Planned/Proposed Summary ........................................................................................... 89 HOUSING NEEDS ANALYSIS ....................................................................................... 93 Introductions ................................................................................................................... 93 General Occupancy Housing Needs Analysis................................................................. 93 Senior Housing Needs Analysis ...................................................................................... 97 ALUMNI SURVEY ........................................................................................................... 106 CONCLUSIONS AND RECOMMENDATIONS ........................................................... 109 Introduction ..................................................................................................................... 109 Challenges and Opportunities ......................................................................................... 119 APPENDIX ......................................................................................................................... 125 Alumni Survey Summary ................................................................................................ 126-158 Definitions ....................................................................................................................... 159-167

LIST OF TABLES

Table Number and Title Page D-1 Population and Household Growth Trends, University District, 2000 through 2020 .. 11 D-2 Population Age Distribution, University District, 2000 to 2015 .................................. 14 D-3 Households by Size, University District, 2000 ............................................................. 17 D-4 Household Type, University District, 2000 .................................................................. 18 D-5 Household Income by Age of Householder, Cedar Riverside, 2000 to 2015 ............... 20 D-6 Household Income by Age of Householder, Como, 2000 to 2015 ............................... 21 D-7 Household Income by Age of Householder, Marcy-Holmes, 2000 to 2015 ................ 22 D-8 Household Income by Age of Householder, Prospect Park, 2000 to 2015................... 23 D-9 Household Tenure, University District, 2000 to 2010 .................................................. 27 D-10 Tenure by Household Income, University District, 2000 ............................................. 27 D-11 Tenure by Age, University District, 2000 ..................................................................... 29 D-12 Consumer Neighborhood Tapestry Profiles, University District, 2010 ........................ 32

H-1 Age of Housing Stock, University District, 2000 ......................................................... 35 H-2 Housing Stock by Units in Structure, University District, 2000................................... 37 H-3 Units Added in the University District by Year, 2000 - 2008 ...................................... 39 H-4 Units Added in the University District by Structure Type, 2000 - 2008 ...................... 40 H-5 Assessed Value of Homesteaded and Non-Homesteaded Parcels, University District,

2008............................................................................................................................... 42 H-6 Relative Homestead Statistics, 2010 ............................................................................. 44

FSM-1 Single Family and Multifamily Residential Sales, University District, 2000 through 2009............................................................................................................................... 49

FSM-2 Historic Median Resale Price in Minneapolis, 2000 to 2009 ....................................... 51 FSM-3 Homes Currently Listed For-Sale, University District, June 2010 ............................... 53 FSM-4 Active Listings in University District by Housing Type, June 2010 ............................ 55 FSM-5 Actively Marketing & Recently Completed Multifamily For-Sale Developments,

University District, August 2010 .................................................................................. 56 RM-1 Average Rents/Vacancies in Minneapolis Submarkets 2009 and 2010 ........................ 61 RM-2 General Occupancy Rental Market Summary, University District, July 2010 ............. 62 RM-3 Market Rate General Occupancy Rental Development, University District July 2010 65 RM-4 Privately Owned Student Oriented Apartments, University District, July 2010 .......... 72 RM-5 Affordable General Occupancy Rental Developments, University District, July 2010 73 RM-6 Public Housing & Section 8, Income Limits, Minneapolis, 2010 ................................ 74 RM-7 Affordable and Subsidized General Occupancy Housing, University District, July

2010............................................................................................................................... 76

LIST OF TABLES (continued)

Table Number and Title Page S-1 Market Rate Senior Housing, Minneapolis, July 2010 ................................................. 79 S-2 Subsidized Senior Housing, Minneapolis, July 2010 ................................................... 82 S-3 Summary of Metropolitan Areas, Comparable University Neighborhood Analysis,

2000 – 2015................................................................................................................... 83 S-4 Comparable University Neighborhoods, Students and Place of Residence, Fall 2009 84 S-5 Senior Housing Near Comparable Universities, 1.5 Mile Radius from University,

July 2010 ....................................................................................................................... 85 S-6 Neighborhood Summary, 1.5 Mile Radius, University of Washington, Seattle ........... 86 S-7 Neighborhood Summary, 1.5 Mile Radius, University of Texas, Austin ..................... 87 S-8 Neighborhood Summary, 1.5 Mile Radius, University of North Carolina, Chapel Hill 88

P-1 Planned and Proposed Housing Projects, University District, January 2011 ............... 90

HN-1 General Occupancy Rental Housing Demand, University District, 2010 to 2020 ....... 94 HN-2 For-Sale Multifamily Housing Demand, University District, 2010 to 2020 ................ 96 HN-3 Market Rate Active Adult/Few Services Housing Demand, University District, 2010

& 2015 .......................................................................................................................... 98 HN-4 Congregate Housing Demand, University District, 2010 & 2015 ................................ 99 HN-5 Market Rate Assisted Living Demand, University District, 2010 & 2015 ................... 101 HN-6 Memory Care Demand, University District, 2010 & 2015 ........................................... 104

CR-1. Summary of Housing Demand, University District, January 2011 .............................. 109 CR-2. Recommended Housing Development, University District, 2011 to 2020 .................. 112

KEY FINDINGS

MAXFIELD RESEARCH INC. 1

Maxfield Research Inc. was engaged by the University District Alliance to provide market research and consulting services relating to the potential demand for various types of housing products that would serve different market segments in neighborhoods surrounding the Universi-ty of Minnesota Campus. The analysis focused on housing needs within the four core neighbor-hoods surrounding the U of M which are: Prospect Park, SE Como, Marcy Holmes, and Cedar-Riverside. The University District is generally bound by Central Avenue NE to the west, Hen-nepin Avenue East to the north, the Minneapolis municipal border to the east, and Interstate 94 and the Mississippi River to the south (see map on Page 10). Maxfield Research Inc. investigated the potential housing needs and how the neighborhoods may redevelop over time to create new housing market dynamics and provide for households that want to remain or relocate to the neighborhoods because of the proximity of the University, convenient access to public transit, access to spectator sports, among other benefits. Our analy-sis considered low, medium and high growth options by neighborhood depending on the level of redevelopment that may be undertaken. Detailed recommendations (number of units; unit mix and sizes; price/rent; housing features and amenities, etc.) for the housing types identified as needed through 2020 are provided. Definitions, acronyms, and a map of the University District can be found on pages 159-167. The following are key highlights from the housing needs assessment. Demographic Analysis • If the University District followed the medium growth projections, Maxfield Research

estimates its population grew by 13.9% (+3,971 people) and its household base grew by 12.9% (+1,529) between 2000 and 2010. The University District’s population and house-hold base grew faster than those of Minneapolis as a whole (+4.2% population growth; +4.7% household growth) and Hennepin County (+4.7% population growth; +6.0% house-hold growth).

• Between 2010 and 2020, growth in the University District is expected to be slower, with an

overall population growth rate of 8.0% (+2,616 people) and a household growth rate of 7.6% (+1,018 households) if the area follows the medium growth scenario.

• The 18 to 24 age cohort is expected to remain the largest age cohort through 2015. As of

2010, it is estimated to comprise 37% of the population in Cedar-Riverside, 42% in Como, 54% in Marcy-Holmes, and 41% in Prospect Park. The 25 to 34 cohort is the second largest cohort in each neighborhood, comprising 18% of the population in Cedar-Riverside, 21% in Como, 22% in Marcy-Holmes, and 19% in Prospect Park. Residents between the ages of 18 and 34 in the University District are largely students at the University of Minnesota and Augsburg College.

• One- and two-person households dominate the four neighborhoods due to the large amount

of rental housing. Many of the units are in older apartment buildings, which typically in-clude a mixture of studio, one-, and two-bedroom units, with larger units being rare.

KEY FINDINGS


• Non-family households dominated the University District in 2000. Persons living alone comprised 40.0% of the total household base and roommate households formed 29.4% of the total household base. The very high percentage of non-family households is a result of the young, renter household-dominated nature of the University District.

• Of the four neighborhoods, Como is estimated to have the highest median income in 2010 of

$48,356. Prospect Park ranks second with $44,204, Marcy-Holmes ranks third with $29,367, and Cedar-Riverside ranks fourth with $20,346. As the next section will discuss, Como has the highest proportion of homeowners, which has a positive correlation with income. In contrast, Marcy-Holmes and Cedar-Riverside have lower homeownership rates and a larger population of college students. Additionally, Cedar-Riverside is home to a large population of immigrants, many of whom have relatively low incomes.

• As income increases, so does the rate of homeownership. In every neighborhood with a few

exceptions, the homeownership rate increases with each income cohort. In Cedar-Riverside, the rate ranges from 1.7% for households that earned less than $15,000 to 100.0% for households that earned over $150,000. Como ranged from 14.7% to 78.9%, Marcy-Holmes ranged from 3.2% to 100.0%, and Prospect Park ranged from 2.9% to 94.5%.

• Consumer profiles indicate that students are a central part of each neighborhood’s popula-

tion. Consequently, much of the new housing and services in each neighborhood cater to students currently.

Housing Characteristics • In 2000, the largest portion (33.1%) of housing units in the University District overall was

constructed before 1940. However, 67.7% of owner-occupied units compared to 24.7% of renter-occupied units were built before 1940. Single-family units, which are more likely to be owner-occupied, were built well before many apartments in the University District.

• Total development peaked in the University District in 2002 and 2003, with about 64% (932

units) of the total development between 2000 and 2008 occurring just in these two years. A smaller jump in development occurred between 2005 and 2007 when development exceeded 130 units each year.

• Between 2000 and 2008, apartment development dominated overall development, account-

ing for about 72% of the total units added in the University District. Marcy-Holmes and Prospect Park added about 440 apartment units each. Cedar-Riverside and Como accounted for the remaining 175 apartment units.

• A total of 141 homes are classified as relative homestead in the University District. With a

household base of over 13,400, relative homestead properties account for only 1% of the households.

KEY FINDINGS


Rental Housing Market Analysis • In order to assess the current market conditions for rental housing in the University District,

Maxfield Research Inc. conducted an inventory of general occupancy rental projects in the four neighborhoods. Combined, we surveyed nearly 2,200 units among 48 rental develop-ments. As of July 2010, these properties had a combined 3.8% vacancy rate.

• Maxfield Research also inventoried approximately 1,280 units among apartment-style

projects targeting students at the University of Minnesota. Combined, these properties had a vacancy rate of only 1.4%. Of all the units, 742 (57.9%) were added since 2000 and 961 (75.0%) were added since 1990, thus constituting the vast majority of housing units added in the University District in the last 20 years. As long as they continue to be lucrative for de-velopers, student-oriented developments are likely to remain the dominant development ac-tivity near the University of Minnesota campus.

• Of the 356 affordable units in the University District, 265 (74.4%) are in Cedar-Riverside.

The remaining 91 units are in the Stone Arch Apartments in Marcy-Holmes. There are no affordable units in Como or Prospect Park.

• Of the 1,775 subsidized housing units in the University District, 1,303 (73.4%) are located in

Cedar-Riverside. Prospect Park has 10.4% of the total stock, Marcy-Holmes has 9.6%, and Como has 6.6%. The majority (53.4%) of the subsidized units are Section 8, and an addi-tional 41.1% of the units are Public Housing. Numerous other government programs as well as charitable giving support the other subsidized housing units.

For-Sale Housing Market Analysis • Like the rest of the Twin Cities Metro Area and nationwide, the housing market in the

University District peaked in 2005, the peak of the real estate boom. The median sale price in the University District was $254,537 in 2005, an appreciation of over 75% from 2000. Through year-end 2009, the median sales price decreased to $216,172.

• Though the median sales price declined by -13% between 2008 and 2009 in the University

District, 2009 posted the highest number of transactions over the past decade. The high level of resales can be attributed to the 1st time home-buyer tax credit and depressed pricing from lender-mediated properties that were being purchased on a discount.

• Due to the proximity to the University of Minnesota, the University District has been some-

what “housing recession proof” compared to other neighborhoods in Minneapolis and throughout the Twin Cities. This is in part due to the high rental demand from University students and faculty who seek properties near the University, resulting in high demand from real estate investors and traditional buyers. As a result, the number of listings in the neigh-borhood is low as the supply has historically been absorbed rapidly.

KEY FINDINGS


Senior Housing Market Analysis • There is no existing market rate senior housing in the University District, nor is there any

pending market rate senior housing. However, newer condominium development (especially in the Marcy Holmes neighborhood) has been popular with older adults and younger seniors.

• There is just one subsidized senior housing development in the University District. Labor

Retreat is a 77-unit Section 8 building located at 124 4th Avenue Southeast in Marcy-Holmes. Planned/Proposed Projects in University District • Maxfield Research Inc. inventoried 15 potential projects that are either under construction or

in various stages of planning as of January 2011. However, the majority of these projects are on-hold or are stalled, a number of which cannot secure financing.

Alumni Survey • Maxfield Research conducted a survey of older adults (ages 45+) to gauge their level of

interest in moving back/adjacent to the University of Minnesota Minneapolis campus. A to-tal of 4,145 were distributed with a response rate of 10.7%. A summary of findings is lo-cated in the Alumni Survey section of this report, whereas detailed findings are in the Appen-dix.

Housing Needs Analysis • Based on our calculations, demand exists for the following general occupancy product types

between 2011 and 2020: o Market rate rental 569 units o Affordable rental 526 units o Subsidized rental 526 units o For-sale condominium 279 units o For-sale townhome 120 units

Note: Student housing demand is not a component of this demand.

• In addition, we find demand for multiple senior housing product types. By 2015, demand for

senior housing is forecast for the following: o Active adult ownership 64 units o Active adult market rate rental 64 units o Congregate 66 units o Assisted living 74 units o Memory care 46 units

KEY FINDINGS


Recommendations and Conclusions • Due to the urban and built-out nature of the University District, we understand that new

housing units developed will be the result of infill development, increased housing densities and/or redevelopment. The number of housing units that could be built in the University Dis-trict will be contingent on the amount of land that is dedicated for residential purposes. The table on the following page summarizes recommended housing development through 2020. The University District may not be able to accommodate all the recommended housing prod-ucts due to land and development constraints.

KEY FINDINGS


Purchase Price/ Pct. of DevelopmentMonthly Rent Range¹ Total Timing

Owner-Occupied Housing (General-Occupancy)Single-Family/Detached Townhomes²

Entry-Level $225,000 - $300,000 6 - 8 27% 2011+ (ongoing)Move-up $350,000 - $500,000 8 - 10 36% 2011+ (ongoing)

Executive $500,000+ 8 - 10 36% 2011+ (ongoing)Total 22 - 28 100%

Multifamily Townhomes/Twin HomesEntry-level $200,000 - $250,000 25 - 30 22% 2013+

Move-up $325,000 - $450,000 45 - 50 39% 2013+Executive $450,000+ 45 - 50 39% 2013+

Total 115 - 130 100%

Condominiums3

Entry-level $175,000 - $250,000 110 - 130 42% 2014+Move-up $275,000 - $350,000 80 - 90 31% 2014+

Upper-end $375,000+ 70 - 80 27% 2014+Total 260 - 300 100%

General Occupancy Rental Housing (Non-Student Oriented)4

Market Rate Rental Housing $800 - $1,850 350 - 450 64% 2011+Affordable Rental5 50% to 120% AMI 150 - 200 27% 2011+Subsidized Rental6 30% AMI 50 - 100 9% 2011+

Total 550 - 750 100%

Senior Housing

Active adult affordable rental ** Moderate-income 50 - 60 16% 2011+Active adult market rate rental ** $875 - $1,800 50 - 60 16% 2012+

Active adult owner Market (coop/condominium) 70 - 90 22% 2013+Congregate $1,500 - $2,400 50 - 60 16% 2013+

Assisted Living $2,900 - $3,900 60 - 75 19% 2012+Memory Care7

$4,500 - $6,500 35 - 45 11% 2012+Total 315 - 390 100%

Alternative Development Concept**Active adult rental - mixed income Mix of MR & affordable 90 - 100 29% 2011+

¹ Pricing in 2011 dollars. Pricing can be adjusted to account for inflation.

7 Memory care housing could be a component of a assisted-living or service-intensive congregate building

Source: Maxfield Research Inc.

3 Condominium development could exceed recommended units through high-rise development.

² Replacement need only - based on age of housing stock 50 years and older. Development of single-family or detached townhomes will hinge on land availability and functional obsolence of existing older housing stock. Due to the University District's location, there is pent-up demand that exceeds the replacement need.

6 Although there is demand for over 500 subsidized units over the decade it will be very challenging to develop, given land costs in the University District

4 Student housing demand is above & beyond general-occupancy demand

Note: The University District may not be able to accommodate all recommended housing types based on land availability and development constraints. Recommended development does not directly coincide with total demand.

No. of Units

** Alternative development concept is to combine active adult affordable and active adult market rate into one mixed-income community.

5 The University District could potentially support multiple affordable products through 2020. However, we recommend phasing affordable housing development over the next decade.

PURPOSE AND SCOPE


Purpose and Scope Maxfield Research Inc. was engaged by the University District Alliance to provide market research and consulting services relating to the potential demand for various types of housing products that would serve different market segments in neighborhoods surrounding the Universi-ty of Minnesota Campus. The analysis focused on housing needs within the four core neighbor-hoods surrounding the U of M which are: Prospect Park, SE Como, Marcy Holmes, and Cedar-Riverside. Maxfield Research Inc. investigated the potential housing needs and how the neighborhoods may redevelop over time to create new housing market dynamics and provide for households that want to remain or relocate to the neighborhoods because of the proximity of the University, convenient access to public transit, access to spectator sports, among other benefits. Our analy-sis considered low, medium and high growth options by neighborhood depending on the level of redevelopment that may be undertaken. Detailed recommendations (number of units/lots; unit mix and sizes; price/rent; housing features and amenities, etc.) for the housing types identified as needed in the short-term are provided. Although every effort was initiated to collect data on each neighborhood, Maxfield Research was unable to collect certain data from the Cedar-Riverside neighborhood (also referred to as West Bank). At the time of this report, the Cedar-Riverside neighborhood organization was in transi-tion and was not able to assist with portions of this report. Methodology A number of resources were utilized to obtain information uses in the analysis. The primary data and information sources include the following:

• U.S. Census Bureau • Metropolitan Council • Minnesota Department of Employment and Economic Development • Department of Housing and Urban Development (HUD) • Minnesota Housing Finance Agency (MHFA) • ESRI • Regional Multiple Listing Service of Minnesota (RMLS) • GVA Marquette Advisors • City of Minneapolis • Center for Urban and Regional Affairs (CURA) • University of Minnesota • Interviews with rental property owners/management companies and Realtors • Interviews with developers, buildings, investors of multifamily housing • Interviews with neighborhood personnel

PURPOSE AND SCOPE


Acknowledgements Maxfield Research Inc. would like to thank the following contributors to this study:

• Augsburg College • City of Minneapolis • Dinkytown Business Association • Graduate and Professional Student Association • Marcy-Holmes Neighborhood Association • Minnesota Student Association • Prospect Park East River Rd Improvement Association • Southeast Business Association • Southeast Como Improvement Association • Stadium Village Commercial Association • West Bank Community Coalition • West Bank Business Association • University District Improvement Association • University of Minnesota

o University Relations o Center for Urban and Regional Affairs

DEMOGRAPHIC ANALYSIS


Introduction The following analysis considers key demographic and economic factors that would impact the housing needs in the University District of Minneapolis, Minnesota. The University District is composed of the following four neighborhoods: Cedar-Riverside, Como, Marcy Holmes, and Prospect Park. The University District is generally bound by Central Avenue NE to the west, Hennepin Avenue East to the north, the Minneapolis municipal border to the east, and Interstate 94 and the Mississippi River to the south. (see map on the following page) Included in this section is an analysis of population and household growth trends and projections, population age trends and projections, household income data, household tenure, among others. A review of these characteristics provides insight into the demand for various types of housing in the University District overall. Population and Household Growth Trends and Projections Table D1 presents population and household growth trends for the University District from 1990 to 2020. The data from 1990 to 2000 is from the U.S. Census, while the 2010 estimates and 2020 projections are based on data from ESRI and the Minnesota Demographic Center. Max-field Research Inc. has adjusted projections based on local building trends and presented growth estimates for three scenarios: low, medium, and high. The following points are key findings from Table D1: • The University District is composed of four distinct neighborhoods. Marcy-Holmes has the

largest population, and is heavily residential with a mix of single-family, small multifamily buildings, and large apartment buildings. Como is also heavily residential, but lacks the large high-rise buildings seen in Marcy-Holmes. Prospect Park features single-family and small multifamily housing in the south and east, while large student-oriented apartment com-plexes are located in the west. Multifamily housing and institutional buildings dominate Ce-dar-Riverside. A map of the University District is located on the following page.

• If the University District followed the medium growth projections, we estimate that its

population grew by 13.9% (+3,971 people) and its household base grew by 12.9% (+1,529) between 2000 and 2010. The University District’s population and household base grew fast-er than those of Minneapolis as a whole (+4.2% population growth; +4.7% household growth) and Hennepin County (+4.7% population growth; +6.0% household growth).

• Between 2010 and 2020, growth in the University District is expected to be slower, with an

overall population growth rate of 8.0% (+2,616 people) and a household growth rate of 7.6% (+1,018 households) if the area follows the medium growth scenario.



-- Census --

2000 Low Medium High Low Medium High 2000-2010 2010-2020Cedar-Riverside 7,534 8,060 8,141 8,220 8,130 8,562 8,990 8.1 5.2Como 5,706 5,830 5,893 5,950 5,490 5,780 6,070 3.3 -1.9Marcy-Holmes 9,009 10,280 10,382 10,485 10,800 11,370 11,940 15.2 9.5Prospect Park 6,326 8,050 8,130 8,210 8,960 9,450 9,930 28.5 16.2Total 28,575 32,220 32,546 32,865 33,380 35,162 36,930 13.9 8.0

Minneapolis 382,747 354,315 398,980 405,300 368,530 412,900 425,800 4.2 3.5Hennepin County 1,116,206 1,147,185 1,169,000 1,223,990 1,179,020 1,222,410 1,326,740 4.7 4.6

-- Census --

2000 Low Medium High Low Medium High 2000-2010 2010-2020Cedar-Riverside 2,833 2,960 2,989 3,020 2,830 3,160 3,320 5.5 5.7Como 2,350 2,380 2,403 2,430 2,180 2,295 2,410 2.3 -4.5Marcy-Holmes 4,264 4,905 4,955 5,005 5,195 5,470 5,745 16.2 10.4Prospect Park 2,441 3,040 3,070 3,100 3,330 3,510 3,690 25.8 14.3Total 11,888 13,285 13,417 13,555 13,535 14,435 15,165 12.9 7.6

Minneapolis 162,352 160,160 169,960 172,700 172,190 177,095 182,000 4.7 4.2Hennepin County 456,131 480,530 483,410 507,020 494,395 508,260 558,505 6.0 5.1

-- Estimates --Households

TABLE D1

Population

Pct. Chg. w/Medium Growth-- Estimates -- -- Projections --

Sources: U.S. Census Bureau; ESRI; Metropolitan Council; Maxfield Research Inc.

2000 through 2020UNIVERSITY DISTRICT

POPULATION AND HOUSEHOLD GROWTH TRENDS

2010 2020

2010 2020 Pct. Chg. w/Medium Growth-- Estimates --



• Maxfield Research assumes that the actual growth between 2000 and 2010 was up to 1% higher or lower than the medium growth scenario. The high growth and low growth scena-rios present the upper and lower bounds of possible growth. For the projected growth be-tween 2010 and 2020, we consider the possible range to be 5% higher or lower due to the uncertainty of future economic and demographic trends.

• Prospect Park experienced the largest absolute and proportional growth of all the neighbor-

hoods over the last decade and is projected to have the largest growth in the next decade. The neighborhood’s 28.5% population growth and 25.8% household growth between 2000 and 2010 is largely a result of newly constructed and larger student-oriented apartment build-ings near the University of Minnesota, as well as the addition of several condominium devel-opments. As opportunities for redevelopment become scarcer, population and household growth will slow. Nevertheless, growth is still likely to be significant in Prospect Park due to its close proximity to the University of Minnesota and redevelopment opportunities are un-exhausted.

• Marcy-Holmes has experienced and will continue to experience similar high growth. Be-

tween 2000 and 2010, its 15.2% population growth and 16.2% household growth was a result of large-scale apartment and condominium developments, especially near the University of Minnesota and along the Mississippi River. A number of proposed development projects, as well as the likelihood of others moving in during the next decade, are projected to drive 9.5% population growth and 10.4% household growth if it follows the medium growth scenario.

• The development of a large student-oriented apartment building in Cedar-Riverside and the

continued influx of immigrants to the area drove an estimated 8.1% population growth and 5.5% household growth between 2000 and 2010 in the neighborhood, if following the me-dium growth scenario. Due to limited redevelopment opportunities, the population is ex-pected to grow by 5.2% and the household base is expected to grow by 5.7% between 2010 and 2020.

• Como was the slowest growing neighborhood in the last decade and is projected to lose some

persons and households in the next decade. The neighborhood experienced a trend toward higher vacancy in the last ten years, but due to the construction of a large non-profit apart-ment and townhome development, the neighborhood is estimated to have experienced 3.3% population growth and 2.3% household growth between 2000 and 2010, if it followed the medium growth scenario. Over the next decade, Como is projected to experience a popula-tion decline (-1.9%) and household decline (-4.5%), a pattern common to older inner-city neighborhoods. However, due to the small number of people and households expected to leave, a single large development could result in population change closer to the growth pro-jected in a high growth scenario.



Age Distribution The demographic profile of a neighborhood and/or community and forecast growth in key age cohorts impacts the types of housing products demanded. We make assumptions on the types of housing needed based on typical patterns and preferences of specific age segments and the forecast growth among these age segments. Below is a summary of housing life-cycle stages.

Entry-level householders ▪ Often prefer to rent basic, inexpensive apartment units ▪ Usually single householders or couples without children in their early 20s ▪ Will often live with roommates in an apartment setting to reduce housing costs

First-time homebuyers and move-up renters ▪ Often prefer to purchase modestly-priced single-family homes or rent newer

apartment units with more amenities ▪ Usually married or cohabiting couples, some with children, but most are without

children, in their mid-20s or 30s

Move-up homebuyers ▪ Typically prefer to purchase newer, larger, and therefore more expensive single-

family homes ▪ Typically families with children where householders are in their late-30s to late-

40s

Empty-nesters (whose children have grown and left home) and Never-nesters (who never had children)

▪ Prefer owning but will consider renting their housing ▪ Some will move to alternative lower maintenance housing products ▪ Generally couples in their 50s or 60s

Younger independent seniors ▪ Prefer owning but will consider renting their housing ▪ Will often move (at least part of the year) to retirement havens in warmer climates ▪ Desire to reduce upkeep and maintenance responsibilities ▪ Generally in their late 60s or 70s

Older seniors ▪ May need to move out of their single-family home due to physical and/or health

constraints or a desire to reduce upkeep and maintenance responsibilities ▪ Generally single females (widows) in their mid-70s or older

Table D2 and the following graph show trends in the age distribution of each neighborhood in the University District based on the medium growth scenario in 2010.



2000 2010 2015

Cedar-Riverside No. No. No. No. Pct. No. Pct.17 & Under 1,331 1,385 1,388 54 4.1 3 0.218-24 2,835 2,992 3,029 157 5.5 37 1.225-34 1,396 1,456 1,519 60 4.3 63 4.335-44 716 653 634 -63 -8.8 -19 -3.045-54 471 575 543 104 22.0 -31 -5.555-64 343 533 592 190 55.5 59 11.065-74 278 338 430 60 21.7 92 27.175+ 164 208 217 44 26.8 9 4.3

Total 7,534 8,141 8,352 607 8.1 211 2.60.57 0.58 0.57

Como No. No. No. No. Pct. No. Pct.17 & Under 623 566 539 -57 -9.1 -27 -4.818-24 2,348 2,504 2,471 156 6.6 -33 -1.325-34 1,352 1,242 1,231 -110 -8.1 -11 -0.935-44 465 399 377 -66 -14.2 -22 -5.645-54 424 517 482 93 21.9 -35 -6.855-64 190 285 311 95 50.2 25 8.965-74 137 165 207 28 20.1 43 25.975+ 167 215 219 48 28.6 4 1.8

Total 5,706 5,893 5,836 187 3.3 -57 -1.00.31 0.30 0.29

Marcy-Holmes No. No. No. No. Pct. No. Pct.17 & Under 458 514 542 56 12.2 28 5.418-24 4,972 5,620 5,944 648 13.0 325 5.825-34 1,795 2,302 2,239 507 28.2 -63 -2.735-44 699 701 845 2 0.3 144 20.545-54 485 577 567 92 19.0 -11 -1.855-64 254 336 368 82 32.3 32 9.465-74 159 156 188 -3 -1.8 32 20.575+ 187 176 184 -11 -6.1 8 4.7

Total 9,009 10,382 10,876 1,373 15.2 494 4.8

Prospect Park No. No. No. No. Pct. No. Pct.17 & Under 702 865 928 163 23.2 63 7.218-24 2,674 3,294 3,582 620 23.2 288 8.725-34 1,201 1,529 1,409 328 27.3 -119 -7.835-44 525 695 909 170 32.3 214 30.845-54 531 653 713 122 23.0 60 9.255-64 309 555 595 246 79.5 41 7.365-74 201 264 349 63 31.6 84 31.975+ 183 275 305 92 50.3 30 10.9

Total 6,326 8,130 8,790 1,804 28.5 660 8.10.17 0.16 0.16

Note: Based on medium growth scenario.Sources: U.S. Census Bureau; ESRI; Maxfield Research Inc.

2010 - 20152000 - 2010 ---- Change ----

TABLE D2POPULATION AGE DISTRIBUTION

UNIVERSITY DISTRICT2000 to 2015



Population Age DistributionUniversity District - 2010

0

1,000

2,000

3,000

4,000

5,000

6,000

17 &Under

18-24 25-34 35-44 45-54 55-64 65-74 75+

Age Cohort

Popu

latio

n

Cedar-Riverside

Como

Marcy-Holmes

Prospect Park

The following are key points from Table D2: • Between 2000 and 2010, the 18-24 age cohort is estimated to have added the most people in

Como, Marcy-Holmes, and Prospect Park. The cohort increased by 156 persons in Como, 648 in Marcy-Holmes, and 620 in Prospect Park. Cedar-Riverside also had significant growth of 156 people age 18 to 24, but its 55 to 64 cohort added 190 people. Growth in the 18 to 24 age cohort is primarily from students at the University of Minnesota and, to a lesser extent, Augsburg College. Since people age 18 to 24 are considered entry-level household-ers, most growth drives demand for rental housing.

• The 18 to 24 age cohort is expected to remain the largest age cohort through 2015. As of

2010, it is estimated to comprise 37% of the population in Cedar-Riverside, 42% in Como, 54% in Marcy-Holmes, and 41% in Prospect Park. The 25 to 34 cohort is the second largest cohort in each neighborhood, comprising 18% of the population in Cedar-Riverside, 21% in Como, 22% in Marcy-Holmes, and 19% in Prospect Park. Residents between the ages of 18 and 34 in the University District are largely students at the University of Minnesota and Augsburg College.

• Between 2000 and 2010, the 55 to 64 age cohort had the largest percent growth in every

neighborhood, and the largest absolute growth in Cedar-Riverside. Growth in this cohort is primarily generated from existing baby boomer households aging into the cohort rather than the influx of people that characterize growth in the 18 to 24 cohort. Consequently, the 55 to 64 growth has a minimal effect on demand for housing.



• Cedar-Riverside, Como, and Prospect Park witnessed considerable proportional growth between 2000 and 2010 in the 75+ population. Some older seniors are no longer able or will-ing to take care of their single-family homes, and therefore move to senior housing. As a re-sult of a growing senior population, the University District neighborhoods have seen increas-ing demand for senior housing.

• Over the next five years, Marcy-Holmes and Prospect Park are projected to have similar

growth trends as they did between 2000 and 2010. The 18 to 24 age cohorts are expected to experience the largest absolute growth, with Marcy-Holmes adding 325 people and Prospect Park adding 288 people. This growth will drive demand for new rental housing, particularly close to the University of Minnesota. Both neighborhoods will also see the largest propor-tional growth in the 65 to 74 cohort, as the large cohort of baby boomers continues to age. Finally, both are expected to see major growth in the 35 to 44 cohorts. Both have attracted condominium development, which, in-turn, attracts move-up buyers and empty-nesters.

• Cedar-Riverside’s growth will shift in favor of older cohorts, with people age 55 and older

accounting for 160 of the projected 211 new residents (76% of the total) between 2010 and 2015.

• Como’s growth is projected to be only in the 55 and older age cohorts, although a large new

rental development could significantly alter the neighborhood demographic patterns over the next five years.

Household Size Table D3 shows the distribution of households by household size in each neighborhood. The data is based on the 2000 Census and provides an indication of the types of housing units for which there may be demand in the future. The following are key points from Table D3: • One- and two-person households dominate the four neighborhoods due to the large amount

of rental housing. Many of the units are in older apartment buildings, which typically in-clude a mixture of studio, one-, and two-bedroom units, with larger units being rare.

• Cedar-Riverside and Marcy-Holmes were dominated by one-person households, with such

households comprising 49.5% and 47.3% of the total, respectively. Two-person households were the second most common, and the two household sizes combined comprised approx-imately three-quarters of the total household base in Cedar-Riverside and Marcy-Holmes.

• Two person households were the most common in Como and Prospect Park, comprising

37.7% and 35.9% of the household base, respectively. One-person households were the second most common, and two household sizes combined formed well over 50% of the household base.



• Since 2000, there has been more development of student-oriented apartments with three- and four-bedroom units in addition to smaller studio and one-bedroom units. Therefore, the number of households larger than two people is likely to have increased.

Household Size Pct. Pct. Pct. No. Pct.

1-person 1,402 49.5 571 24.3 2,015 47.3 762 31.22-person 707 25.0 886 37.7 1,320 31.0 876 35.93-person 339 12.0 463 19.7 474 11.1 355 14.54-person 192 6.8 267 11.4 240 5.6 306 12.55-person 99 3.5 104 4.4 117 2.7 88 3.66-person 51 1.8 40 1.7 46 1.1 29 1.27-or-more-persons 43 1.5 19 0.8 52 1.2 25 1.0Total 2,833 100.0 2,350 100.0 4,264 100.0 2,441 100.0

Prospect ParkNo.

Cedar-Riverside Como Marcy-Holmes

Sources: U.S. Census Bureau; Maxfield Research Inc.

TABLE D3HOUSEHOLDS BY SIZEUNIVERSITY DISTRICT

2000

No. No.

Household Type Table D4 shows a breakdown of the type of households in the each of the neighborhoods within the University District in 2000. This data is useful in assessing housing demand since the household composition often dictates the type of housing needed and preferred. The following are key points from Table D4: • Non-family households dominated the University District in 2000. Persons living alone

comprised 40.0% of the total household base and roommate households formed 29.4% of the total household base. The very high percentage of non-family households is a result of the young, renter household-dominated nature of the University District.

• In Cedar-Riverside, 61.3% of households were non-family households. Of its family house-

holds, “Other Family” formed a significantly higher portion (22.2%) compared to the Uni-versity District as a whole (11.8%). It is common for many of the immigrant families in the area to have extended family members in a unit.

• Como was the only neighborhood with over 40.0% of its households being family house-

holds (42.3%). This is a result of the proportionally larger stock of single-family homes, which will be presented in a later section.



Married w/ Married w/o Other Persons OtherChildren Children Family Living Alone (Roommates)

Number of Households

Cedar-Riverside 2,833 239 227 630 1,402 335Como 2,350 256 491 246 571 786Marcy-Holmes 4,264 167 310 290 2,015 1,482Prospect Park 2,441 204 351 237 762 887Total 11,888 866 1,379 1,403 4,750 3,490

Percent of Total

Cedar-Riverside 100.0 8.4 8.0 22.2 49.5 11.8Como 100.0 10.9 20.9 10.5 24.3 33.4Marcy-Holmes 100.0 3.9 7.3 6.8 47.3 34.8Prospect Park 100.0 8.4 14.4 9.7 31.2 36.3Total 100.0 7.3 11.6 11.8 40.0 29.4


Family Households

Total

TABLE D4HOUSEHOLD TYPE

UNIVERSITY DISTRICT2000

Non-Family Households

• In Marcy-Holmes, 82% of the households were non-family households, with 47.3% being

persons living alone and 34.8% being roommate households. Comprising only 3.9% of the household base, married households with children were less common in Marcy-Holmes than in any other University District neighborhood. The data suggests that students and other young households are the most prevalent households in the neighborhood.

• Prospect Park had the largest proportion of roommate households of all neighborhoods, with

such households forming 36.3% of the total household base. Many of the apartments in the western portion of the neighborhood are student-oriented buildings with the majority of their units having two to four bedrooms, hence many of the households were roommates. Addi-tional apartments with multiple-bedroom units have been added since 2000, likely increasing the proportion of roommate households. Prospect Park also had a higher-than-average mar-ried without children household base (14.4% of the total). There are many large and high-value single-family homes in the eastern part of the neighborhood that are likely home to older households who may no longer have children living at home.

Household Income Tables D5 through D8 show the estimated distribution of household incomes in each University District neighborhood for 2000, 2010, and 2015. The following graph shows median income by age group for each neighborhood and the University District as a whole. The 2000 data is from the U.S. Census Bureau, and the 2010 and 2015 data is estimated by ESRI, a nationally-recognized demographic services firm, with adjustments by Maxfield Research Inc. based on



local building trends. The data helps in ascertaining the demand for different housing products based on the size of the market at specific cost levels. The Department of Housing and Urban Development defines affordable housing costs for families as 30% of a household’s adjusted gross income. For rental housing, Maxfield Research uses this figure for younger households and 40% for seniors, since seniors generally have lower living expenses and can often sell their homes in order to generate proceeds for rental or service-intensive senior housing. A generally accepted standard for affordable owner-occupied housing is that a typical household can afford to pay 3.0 to 3.5 times their annual income on a single-family home. This range assumes that the person has adequate funds for down payment and closing costs, but does not have savings or equity in an existing home which would allow them to purchase a higher priced home. The following are key points from Tables D5 through D8: • Of the four neighborhoods, Como is estimated to have the highest median income in 2010 of

$48,356. Prospect Park ranks second with $44,204, Marcy-Holmes ranks third with $29,367, and Cedar-Riverside ranks fourth with $20,346. As the next section will discuss, Como has the highest proportion of homeowners, which has a positive correlation with income. In contrast, Marcy-Holmes and Cedar-Riverside have lower homeownership rates and a larger population of college students. Additionally, Cedar-Riverside is home to a large population of recent immigrants, many of whom have relatively low incomes.

• Each neighborhood is expected to see its median income increase between 2010 and 2015.

Between 2000 and 2010, it is estimated that median income increased 43% in Cedar-Riverside, 44% in Como, 35% in Marcy-Holmes, and 19% in Prospect Park. In the next five years, median income is projected to increase 31% in Cedar-Riverside, 19% in Como, 20% in Marcy-Holmes, and 25% in Prospect Park.



Total Under 25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 1,488 341 344 222 171 132 177 100$15,000 to $24,999 519 87 195 86 72 37 23 20$25,000 to $34,999 256 43 70 55 39 29 12 8$35,000 to $49,999 216 47 93 52 8 17 0 0$50,000 to $74,999 184 49 73 25 18 18 0 0$75,000 to $99,999 76 4 19 17 23 13 0 0$100,000 to $149,999 87 15 42 13 7 7 4 0$150,000 to $199,999 0 0 0 0 0 0 0 0$200,000+ 8 0 0 0 8 0 0 0 Total 2,833 586 836 470 345 252 216 128

Median Income $14,226 $12,068 $18,826 $16,286 $15,537 $13,831 $9,999 $10,000


Median Income $20,346 $16,709 $26,293 $25,439 $26,739 $17,169 $10,142 $14,241


Median Income $26,717 $25,343 $43,186 $31,366 $37,114 $18,493 $10,521 $16,129

Note: Based on medium growth scenario.Sources: ESRI; Maxfield Research Inc.

2000

2010

2000 to 2015

Age of Householder

2015

TABLE D5HOUSEHOLD INCOME BY AGE OF HOUSEHOLDER

CEDAR-RIVERSIDE(Number of Households)



Total Under 25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 550 264 94 22 20 18 25 106$15,000 to $24,999 330 169 97 19 12 6 8 19$25,000 to $34,999 381 176 114 44 43 0 4 0$35,000 to $49,999 406 74 177 50 68 18 19 0$50,000 to $74,999 405 65 131 101 49 32 28 0$75,000 to $99,999 102 26 22 17 20 13 3 0$100,000 to $149,999 152 27 21 6 55 39 5 0$150,000 to $199,999 14 0 5 5 4 0 0 0$200,000+ 11 0 5 6 0 0 0 0 Total 2,350 801 666 269 271 126 92 125

Median Income $33,575 $22,452 $40,023 $49,663 $44,067 $65,090 $46,942 $11,270


Median Income $48,356 $30,001 $49,810 $55,662 $60,022 $89,235 $52,324 $24,177


Median Income $57,678 $38,295 $53,801 $62,258 $83,713 $104,283 $63,928 $63,497


2000 to 2015

Age of Householder

2015


COMO(Number of Households)

2000

2010



Total Under 25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 1,498 939 323 82 34 24 35 60$15,000 to $24,999 882 470 252 58 28 20 0 55$25,000 to $34,999 696 276 212 75 51 41 15 26$35,000 to $49,999 431 140 138 49 74 17 13 0$50,000 to $74,999 378 65 79 115 85 14 20 0$75,000 to $99,999 202 58 52 46 16 0 22 8$100,000 to $149,999 124 0 13 13 28 59 12 0$150,000 to $199,999 4 0 0 4 0 0 0 0$200,000+ 49 8 0 10 19 12 0 0 Total 4,264 1,955 1,069 453 336 186 116 149

Median Income $21,735 $15,671 $22,376 $40,716 $45,000 $42,315 $37,912 $17,831


Median Income $29,367 $18,066 $30,789 $52,206 $50,455 $101,591 $78,723 $24,403


Median Income $35,260 $20,000 $37,754 $56,956 $62,819 $107,124 $98,120 $38,841


2000

2010

2000 to 2015

Age of Householder

2015


MARCY-HOLMES(Number of Households)



Total Under 25 25-34 35-44 45-54 55-64 65 -74 75+


Median Income $37,148 $24,241 $35,269 $52,185 $60,000 $100,000 $52,805 $58,849


Median Income $44,204 $24,949 $39,780 $56,060 $76,196 $103,267 $55,940 $50,000


Median Income $55,408 $26,725 $49,620 $63,560 $105,214 $124,782 $81,468 $72,505


2000

2010

2000 to 2015

Age of Householder

2015


PROSPECT PARK(Number of Households)



Household Income by Age of Householder University District - 2010

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

Under 25 25-34 35-44 45-54 55-64 65-74 75+Age of Householder

Med

ian

Ann

ual I

ncom

e

University District

Cedar-Riverside

Como

Marcy-Holmes

Prospect Park

Non-Senior Households • Cedar-Riverside has the lowest median income because a large segment of its population

lives in subsidized or public housing. Additionally, there are a significant number of student households, which typically have lower incomes. For a household earning the median family income to have affordable monthly rent (rent does not exceed 30% of gross monthly in-come), rent would have to be about $510 or less. An affordable owner-occupied unit (does not exceed three times annual income) could not exceed about $61,040. Although either price point is unlikely to be achievable without significant subsidies, the increasing desirabil-ity of the area is likely to draw households with somewhat higher incomes, which would help make new market-rate rental or condominium development viable.

• Como has a much higher homeownership rate, as the next section will explain, and conse-

quently has a higher median income than Cedar-Riverside. Typically a household’s top earn-ing years are between the ages of 45 and 64, a pattern that Como follows with median in-come peaking at $89,235 for the 55 to 64 cohort. For a household earning the overall median income of $48,356, a rental unit would be affordable at about $1,210 per month and an own-er-occupied unit would be affordable at a sales price of about $145,070 to $168,250, both rates that are achievable without subsidies.

• Marcy-Holmes’ lower median income is primarily a result of the large number of student

households in the area. As of 2010, households under the age of 25 accounted for an estimated 45% of the total household base and had a median income of $18,066. Nevertheless, several



luxury condominium developments in the neighborhood have attracted high-income older adults, resulting in a median income of $101,591 for households age 55 to 64. For a household earning the overall median income, a rental unit would be affordable at about $740 per month or less and an ownership unit would be affordable with a sale price of about $103,600 or less. However, it is important to note that higher rents or values are often supportable because many students receive financial assistance from their parents that is not reflected in the household income figures.

• Prospect Park also attracts a large number of student renters, but also has the highest homeow-

nership rate. Due to a large stock of high-value homes in the eastern portion of the neighbor-hood, it has the highest overall median income, as well as the highest older-adult median in-come of $103,267 for households age 55 to 64. For a household earning the overall median income, a rental unit would be affordable at about $1,105 per month or less and an ownership unit would be affordable at a sale price of about $132,600 to $154,700.

Senior Households • Incomes drop significantly as householders age. In 2010 in Como, income drops -54%

between households age 65 to 74 to households age 75 and older. Marcy-Holmes witnessed a -69% drop and Prospect Park a -11% drop. Cedar-Riverside is unusual in that it sees a 40% increase, although its median incomes for households age 65 to 74 and 75 and older are low-er than in the other neighborhoods.

• Generally, senior households with incomes greater than $25,000 can afford market-rate

senior housing. Based on a 40% allocation of income for housing, this translates to monthly rents of at least $833. In 2010, an estimated 91 senior households in Cedar-Riverside (23% of the total), 160 senior households in Como (61% of the total), 164 senior households in Marcy-Holmes (66% of the total), and 189 senior households in Prospect Park (72% of the total) have incomes of at least $25,000 in 2010.

• Seniors who are able and willing to pay 80% or more of their income on assisted living

housing would need an annual income of $40,000 to afford monthly rents of $2,700, which is about the beginning monthly rent for assisted living in Minneapolis. In 2010, there are an estimated 32 older senior households (age 75+) in Cedar-Riverside (21% of the total), 71 in Como (46% of the total), 47 in Marcy-Holmes (35% of the total), and 76 in Prospect Park (63% of the total) with annual incomes of at least $40,000.

Tenure Table D9 shows the number of owner and renter households in each neighborhood of the Uni-versity District in 2000 and 2010. The 2000 data is from the U.S. Census and the 2010 estimates are from ESRI with adjustments by Maxfield Research Inc. to better reflect local household growth trends. The data is useful because it shows the propensity of households to rent or own their housing. It is important to note that tenure figures refer to dwelling units, not parcels. The following are key points from the table:



• Home-ownership rates in the Cedar-Riverside are estimated to have increased slightly from

10.2% in 2000 to 10.4% in 2010. Nevertheless, due to the small number of single-family homes and condominiums in the neighborhood, it has the highest percentage of renters among the University District neighborhoods.

• Como has the highest homeownership rate, with an estimated 37.7% in 2010, which is a

slight increase from 36.0% in 2000. The neighborhood is somewhat “less convenient” to the University of Minnesota student body than Marcy-Holmes or Prospect Park and has a com-paratively large stock of single-family homes.

• Marcy-Holmes’ homeownership rate dropped slightly from 12.2% in 2000 to 11.5% in 2010.

The neighborhood has a high proportion of renters due to its close proximity to the Universi-ty of Minnesota. In addition, rental development along University Avenue and 4th Street has outstripped condominium development near the Mississippi River in the last ten years, result-ing in a slight overall increase in renting.

• Prospect Park observed a drop in the homeownership rate from 28.2% in 2000 to 24.9% in

2010 as a result of significant student-oriented apartment development near the western boundary of the neighborhood adjacent to the University of Minnesota. Nevertheless, it con-tinues to have the second highest homeownership rate, and development of ownership hous-ing did occur in the last decade.

Tenure by Income Table D10 shows the number of owner and renter households in each University District neigh-borhood by income cohort in 2000. The data is useful because it shows the housing options and preferences for households based on affordability. The following are key points from the table. • As income increases, so does the rate of homeownership. In every neighborhood with a few

exceptions, the homeownership rate increases with each income cohort. In Cedar-Riverside, the rate ranges from 1.7% for households that earned less than $15,000 to 100.0% for house-holds that earned over $150,000. Como ranged from 14.7% to 78.9%, Marcy-Holmes ranged from 3.2% to 100.0%, and Prospect Park ranged from 2.9% to 94.5%.

• For every income cohort under $50,000, residents of Como had a higher propensity to own

their housing than in the other neighborhoods. The higher proportion of single-family homes and its moderate isolation from the University of Minnesota compared to the other neighbor-hoods are important factors in this difference.



No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

2000 290 10.2 2,543 89.8 847 36.0 1,503 64.0 519 12.2 3,745 87.8 689 28.2 1,752 71.8

2010 311 10.4 2,678 89.6 905 37.7 1,498 62.3 572 11.5 4,383 88.5 764 24.9 2,306 75.1

Change, 2000 - 2010 21 7.2 135 5.3 58 6.8 -5 -0.3 53 10.2 638 17.0 75 10.9 554 31.6

Source: US Census Bureau; ESRI; Maxfield Research Inc.

TABLE D9HOUSEHOLD TENUREUNIVERSITY DISTRICT

2000 to 2010

Own Own Own OwnCedar-Riverside Como Marcy-Holmes Prospect Park

Rent Rent Rent Rent

No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

Less than $15,000 25 1.7 1,483 98.3 67 14.7 389 85.3 36 3.2 1,097 96.8 15 2.9 506 97.1$15,000 to $24,999 61 11.4 476 88.6 38 12.0 279 88.0 24 3.2 723 96.8 44 11.7 332 88.3$25,000 to $34,999 31 13.0 207 87.0 151 36.6 262 63.4 65 11.5 501 88.5 36 13.7 227 86.3$35,000 to $49,999 43 21.3 159 78.7 124 29.0 303 71.0 53 15.4 292 84.6 84 19.6 344 80.4$50,000 to $74,999 49 24.9 148 75.1 273 63.3 158 36.7 110 32.5 228 67.5 134 31.2 296 68.8$75,000 to $99,999 38 48.1 41 51.9 55 45.8 65 54.2 62 35.2 114 64.8 77 69.4 34 30.6$100,000 to $150,000 35 47.9 38 52.1 110 74.3 38 25.7 90 92.8 7 7.2 151 82.5 32 17.5$150,000+ 7 100.0 0 0.0 30 78.9 8 21.1 42 100.0 0 0.0 138 94.5 8 5.5Total 289 10.2 2,552 89.8 848 36.1 1,502 63.9 482 14.0 2,962 86.0 679 27.6 1,779 72.4

Source: US Census Bureau; Maxfield Research Inc.

Prospect ParkOwn Rent

TABLE D10TENURE BY HOUSEHOLD INCOME


RentCedar-Riverside Como Marcy-Holmes

Own Rent Own Rent Own



• Typically renter households with incomes of $25,000 or less qualify for government-subsidized housing. As of 2000, about 70% of all households in Cedar-River, 28% in Como, 53% in Marcy-Holmes, and 34% in Prospect Park were renter households with annual in-comes below $25,000. However, a portion of these households were student households that may have received financial assistance from their parents. An additional portion of these renter households already live in subsidized housing in their respective neighborhoods.

• Renter households with incomes between $25,000 and $40,000 are usually the market for

“affordable” rental projects with a shallow subsidy (housing with income restrictions and rents slightly below market rents, such as those financed through Minnesota Housing Finance Agency’s Section 42/Low-Income Housing Tax Credit program). These households can typ-ically afford housing costs of between $625 and $1,000 per month. As of 2000, about 9% of the total households in Cedar-Riverside, 15% in Como, 17% in Marcy-Holmes, and 14% in Prospect Park were renters with incomes between $25,000 and $40,000. As with the lower-income renters, a portion of these households were students receiving financial assistance from their parents and others were already in affordable housing

Tenure by Age of Householder Table D11 shows the number of owner and renter households in each neighborhood of the University District by age group in 2000. This data shows the propensity of households to own or rent their housing based on their age. The following are key points from the table: • In each of the four neighborhoods, homeownership was at its lowest rate among households

age 15 to 24, then increased for each age cohort until it peaked among households between 55 and 74, and finally dropped for households age 75+. Such a pattern is typical throughout the United States. Younger households are most likely to rent because they have lower in-comes and a high propensity to move for education or employment. Households become more likely to purchase as they age and their incomes increase until they enter their senior years, during which some households move to rental housing to avoid maintenance responsi-bilities or service-intensive housing such as assisted living because they can no longer live independently.

• Although Cedar-Riverside followed the typical pattern of homeownership, homeownership

peaked at 16.3% among households age 55 to 64 compared to 84.9% in Como, 54.3% in Marcy-Holmes, and 77.3% in Prospect Park among the same age cohort. As already dis-cussed, low-income rental housing has a much larger presence in Cedar-Riverside than in the other neighborhoods, resulting in lower homeownership rates for all age cohorts.

• Not only did Como have the highest overall homeownership rate, but it had the highest

homeownership rate in every age cohort. Homeownership began at 5.6% for households age 15 to 24, increasing to a peak of 88.0% for households age 65 to 74, and then dropping to 86.4% for households age 75 and older.

.



Own Rent Own Rent Own Rent Own Rent Own Rent Own Rent Own Rent Own Rent

Cedar-Riverside 29 557 61 775 61 409 54 291 41 211 29 187 15 113 290 2,543 Pct. Own

Como 45 756 153 513 148 121 205 66 107 19 81 11 108 17 847 1,503 Pct. Own

Marcy-Holmes 30 1,925 88 981 97 356 102 234 101 85 52 64 49 100 519 3,745 Pct. Own

Prospect Park 9 805 85 587 126 160 185 119 136 40 92 22 56 19 689 1,752Pct. Own

Total 113 4,043 387 2,856 432 1,046 546 710 385 355 254 284 228 249 2,345 9,543Pct. Own

Sources: U.S. Census, Maxfield Research Inc.

12.6%1.1%

Age 35 - 44 Age 45 - 54

60.9%44.1%

7.3%

28.2%74.7%80.7%77.3%

TABLE D11TENURE BY AGE


13.4%

Age 15 - 24 Age 25 - 34 Age 55 - 64 Age 65 - 74 Age 75+ Total

10.2%11.7%

84.9% 88.0% 86.4%

4.9%

5.6% 23.0% 55.0%

16.3%15.7%13.0%

36.0%

1.5% 8.2% 21.4% 30.4% 54.3% 44.8% 32.9% 12.2%

75.6%

19.7%47.8%47.2%52.0%43.5%29.2%11.9%2.7%



0

10

20

30

40

50

60

70

80

90

100

15-24 25-34 35-44 45-54 55-64 65-74 75+

Perc

ent H

omeo

wne

rs

Age Cohort

Tenure by Age (Owners)University District - 2000

Cedar-Riverside

Como

Marcy-Holmes

Prospect Park

University District

• Marcy-Holmes had lower homeownership rates throughout the age cohorts due to its large

stock of rental housing. Its 1.5% homeownership rate among households age 15 to 24 was significantly lower than the rates for the same cohort in Cedar-Riverside (4.9%) and Como (5.6%) because a larger portion of Marcy-Holmes’ residents were students who likely lived in the neighborhood only for their time in college and thus chose to rent instead of buy.

• Prospect Park had the lowest homeownership rate among households age 15 to 24 (1.1%) for

the same reasons Marcy-Holmes had a similarly low rate among young households. Howev-er, homeownership in Prospect Park peaked at 80.7% for households age 65 to 74 compared to 54.3% in Marcy-Holmes for households age 55 to 64. Prospect Park has a larger stock of higher-value, single-family homes that appeal to older adult households that could afford to purchase in the neighborhood.

Consumer Profile Table D12 shows the percentage of households in several identified ESRI Tapestry Segments. ESRI has developed 65 Tapestry Segments based on socioeconomic and demographic trends and has determined the composition of every neighborhood in the United States. Businesses throughout the country widely use the data to make decisions about whether and how to enter markets and how to better position themselves in markets where they are already present. The data is useful for neighborhood planning because it quantitatively highlights the demographic



groups to which a neighborhood appeals and identifies opportunities for attracting particular groups in the future. Below is a brief summary of each of the seven Tapestry Segments ESRI has identified as being present in the University District neighborhoods. Full-page descriptions provided by ESRI are in the Appendix at the end of the report.

College Towns – Fifty-nine percent of these households are college students. The remainder are recent graduates still affiliated with a local university through employ-ment or local homeowners who may or may not have an affiliation with a local uni-versity. The student households typically rent their housing.

Dorms to Diplomas – Seventy-nine percent of these households are college students

and ninety percent of them rent their housing. A stronger presence of students and a weaker presence of homeowners distinguish this category from College Towns.

Laptops and Lattes – Young, single, professionals with median incomes of almost

$100,000 typify this group. Most live alone or with one roommate, and they prefer dense, urban locations. Only 39% own their homes.

Metropolitans – These households live in various kinds of housing, ranging from sin-

gle-family to large apartment buildings, but favor inner-city locations with many en-tertainment and dining options. They are typically middle-aged and college-educated, within 60 percent owning their homes.

Metro Renters – Typical households are young, single, and college-educated. Most

are in the earlier years of professional careers and rent their housing in dense, high-amenity, urban locations. Many live alone, but some rent with a roommate.

Young and Restless – Younger than Metro Renters, these households are often just

beginning professional careers. The majority rent their housing, and turnover is high because they move frequently for better job opportunities.

Social Security Set – Common in urban areas, these households are typically older

with many being seniors, but many younger households reliant on public assistance are also in this segment. The majority rent their housing, often at subsidized rates, and half do not own a car.

The following are key points from Table D12: • College Towns and Dorms to Diplomas comprise over 50% of the households in Como,

Marcy-Holmes, and Prospect Park due to the close proximity of the University of Minnesota and the ample supply of housing open to students.

• With 86.9% of Marcy-Holmes households being either of the two student-oriented segments,

students have a more dominant presence in that neighborhood than any of the other three. It



is especially notable that 60.7% of households are Dorms to Diplomas, the most student-dominated Tapestry Segment. Although students are likely to retain a strong presence in the neighborhood, recent condominium development may begin to diversify the household base.

• Cedar-Riverside is also an important student center, with 36.2% of households being in the

College Towns segments. The remainder of the household base (63.8%) is the Social Securi-ty Set. Rather than being seniors, these households span the age spectrum, but are commonly lower-income, African immigrants. No other neighborhood has a significant Social Security Set.

• Although students are a major component of the Como neighborhood, only 11.0% of house-

holds are the heavily student-dominated Dorms to Diplomas. The significant (33.4%) Me-tropolitans segment likely accounts for most of the homeowners and may represent continued potential to appeal to future homeowners seeking to buy in an urban setting.

• Prospect Park is the most diverse neighborhood in terms of Tapestry Segmentation. Though

student-focused segments comprise about half of the household base, many such households are concentrated in the western part of the district. The presence of significant Laptops and Lattes and Metro Renters segments demonstrate the neighborhood’s appeal to young profes-sionals, and the large base of Metropolitans (22.5%) shows that the neighborhood remains popular with older homeowner households. The wide variety of lifestyles and housing op-tions available in the neighborhood represents an opportunity to retain households throughout their life cycle as well as attract new households, both to rental and ownership housing.

CONSUMER NEIGHBORHOOD TAPESTRY PROFILESTABLE D12

Percent of Households in Tapestry Segment

2010UNIVERSITY DISTRICT

Neighborhood Col

lege

Tow

ns

Dor

ms t

o D

iplo

mas

Lapt

ops a

nd L

atte

s

Met

ropo

litan

s

Met

ro R

ente

rs

You

ng a

nd R

estle

ss

Soci

al S

ecur

ity S

et

Cedar-Riverside 36.2% -- -- -- -- -- 63.8%

Como 43.1% 11.0% -- 33.4% -- 12.5% --

Marcy-Holmes 26.2% 60.7% -- -- 13.1% -- --

Prospect Park 20.5% 30.6% 20.1% 22.5% 6.5% -- --

Sources: ESRI; Maxfield Research Inc.



Demographic Summary The following points summarize key demographic trends in the four University District neigh-borhoods: • All four neighborhoods are estimated to have gained households and population between

2000 and 2010, with Prospect Park experiencing the most growth. All neighborhoods are expected to continue growing in the next decade except Como, which is expected to lose population unless it achieves the high estimate for growth and households.

• Young, non-family households dominate the neighborhoods. Most are likely students at the

University of Minnesota. • Como and Prospect Park have significantly higher median incomes than Marcy-Holmes and

Cedar-Riverside, largely because they have much higher homeownership rates. Marcy-Holmes is particularly attractive to student renters due to its close proximity to the University of Minnesota campus and Cedar-Riverside is home to a large population of people living in public and Section 8 housing. High rental rates are expected to persist in all four neighbor-hoods into the foreseeable future.

• Consumer profiles indicate that students are a central part of each neighborhood’s popula-

tion. Consequently, much of the new housing and services in each neighborhood cater to students currently.

HOUSING CHARACTERISTICS


Introduction The variety and condition of the housing stock in a neighborhood and/or community provides the basis for an attractive living environment. Housing is the primary building block of neighbor-hoods, supporting goods and services. We examined the housing market in each of the Universi-ty District neighborhoods by reviewing data for the University District on: 1) the age of existing housing units; 2) the housing stock by structure type; 3) recent residential building trends since 2000; 4) assessed value of housing units; 5) homestead status; and 6) neighborhood staff inter-views. Age of Housing Stock Table H1 on the following page shows the age of the four neighborhood’s occupied housing stock in 2000 based on the U.S. Census. The table includes the number of housing units built in each neighborhood of the University District as well as the number of units built prior to 1940. The table further breaks down the data by number of owner-occupied and renter-occupied units. The following are key points from Table H1: • In 2000, the largest portion (33.1%) of housing units in the University District overall was

constructed before 1940. However, 67.7% of owner-occupied units compared to 24.7% of renter-occupied units were built before 1940. Single-family units, which are more likely to be owner-occupied, were built well before many apartments in the University District.

• Como and Marcy-Holmes had similar development patterns through the 1990s. About 40%

of units in both neighborhoods were built before 1940. As with most areas in the United States, building was light during the 1940s due to World War II. Building then increased each decade through the 1970s, and then began to drop. It is important to note that after World War II, new construction was increasingly apartment buildings rather than single-family homes.

• Prospect Park followed the development pattern of Como and Marcy-Holmes through the

1950s, but experienced a significantly smaller portion of its total housing development through the 1960s and 1970s. Development remained slow in the 1980s, but then jumped in the 1990s, with 15.5% of the total housing stock as of 2000 being added in the decade. Much of the new development was in several apartment buildings developed in the late 1990s near the University of Minnesota.

• Cedar-Riverside has the newest housing units overall, with the median year structures were

built being 1971. The neighborhood experienced a boom in the 1960s and 1970s with the addition of 57.0% of its units, most of them being in a series of high-rise apartment buildings at Cedar Avenue and Interstate 94.



Total Med. Yr.Units Built No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

Owner-Occupied 289 59 20.4 0 0.0 0 0.0 13 4.5 173 59.9 21 7.3 23 8.0Renter-Occupied 2,552 244 9.6 95 3.7 282 11.1 666 26.1 767 30.1 309 12.1 189 7.4Total 2,841 1971 303 10.7 95 3.3 282 9.9 679 23.9 940 33.1 330 11.6 212 7.5

Owner-Occupied 848 661 77.9 39 4.6 125 14.7 0 0.0 0 0.0 16 1.9 7 0.8Renter-Occupied 1,502 342 22.8 101 6.7 134 8.9 245 16.3 416 27.7 191 12.7 73 4.9Total 2,350 1951 1,003 42.7 140 6.0 259 11.0 245 10.4 416 17.7 207 8.8 80 3.4

Owner-Occupied 522 297 56.9 7 1.3 9 1.7 9 1.7 111 21.3 62 11.9 27 5.2Renter-Occupied 3,750 1,302 34.7 196 5.2 553 14.7 592 15.8 793 21.1 258 6.9 56 1.5Total 4,272 1956 1,599 37.4 203 4.8 562 13.2 601 14.1 904 21.2 320 7.5 83 1.9

Owner-Occupied 679 565 83.2 18 2.7 28 4.1 6 0.9 12 1.8 36 5.3 14 2.1Renter-Occupied 1,782 475 26.7 108 6.1 245 13.7 219 12.3 228 12.8 139 7.8 368 20.7Total 2,461 1952 1,040 42.3 126 5.1 273 11.1 225 9.1 240 9.8 175 7.1 382 15.5

Owner-Occupied 2,338 1,582 67.7 64 2.7 162 6.9 28 1.2 296 12.7 135 5.8 71 3.0Renter-Occupied 9,586 2,363 24.7 500 5.2 1,214 12.7 1,722 18.0 2,204 23.0 897 9.4 686 7.2Total 11,924 1961 3,945 33.1 564 4.7 1,376 11.5 1,750 14.7 2,500 21.0 1,032 8.7 757 6.3


1980s<1940 1940s

University District Total

Prospect Park

Marcy-Holmes

Cedar-Riverside

Como

Note: Total units not equal to total households because data based on sample instead of 100% count.

TABLE H1AGE OF HOUSING STOCK


1950s 1960s 1990s

Year Unit Built

1970s



Age of Housing Stock - University District

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Before 1940 1940s 1950s 1960s 1970s 1980s 1990s

Year Structure Built

Num

ber

of S

truc

ture

s Bui

lt

Cedar-Riverside Como Marcy-Holmes Prospect Park

• Since 2000, Marcy-Holmes and Prospect Park have experienced significant development.

Marcy-Holmes has seen a mix of apartment and condominium development, whereas Pros-pect Park has seen primarily apartment development. The previous chapter provided overall tenure estimates, but current data at the level of detail provided on the table is not yet availa-ble

Housing Stock by Structure Type Table H2 shows the housing stock in each neighborhood of the University District by type of structure and tenure as of 2000. This indicates the types of housing structures occupied or vacant and whether they are owned or rented. The following are key points from the table: • Large buildings dominated Cedar-Riverside, with over 80% of occupied housing units in

buildings of 10 units or more. Of these, two-thirds of units were in buildings with more than 50 units. Even among owner-occupied units, 71.6% of units were in buildings with ten or more units.

• Como had the highest percentage of single-family detached homes out of the four neighbor-

hoods, comprising 42.1% of the total occupied housing units. Of the single-family detached homes, about 71% were owner-occupied, which was the highest percentage of any housing type in the four neighborhoods and the reason Como had the highest homeownership rate. Only 24.7% of the total housing stock in Como was buildings with ten units or more.



No. Pct. No. Pct. No. Pct. No. Pct.

Owner occupied: 289 100.0 848 100.0 522 100.0 679 100.01, detached 5 1.7 702 82.8 184 35.2 550 81.01, attached 42 14.5 19 2.2 103 19.7 22 3.22 to 4 units 26 9.0 120 14.2 92 17.6 84 12.45- to 9-plex 9 3.1 0 0.0 19 3.6 6 0.910 to 19 units 13 4.5 7 0.8 0 0.0 12 1.820 to 49 units 0 0.0 0 0.0 12 2.3 0 0.050 + units 194 67.1 0 0.0 109 20.9 0 0.0Mobile home 0 0.0 0 0.0 0 0.0 5 0.7Other 0 0.0 0 0.0 3 0.6 0 0.0

Renter occupied: 2,552 100.0 1,502 100.0 3,750 100.0 1782 100.01, detached 60 2.4 288 19.2 173 4.6 156 8.81, attached 83 3.3 63 4.2 113 3.0 144 8.12 to 4 units 297 11.6 357 23.8 461 12.3 404 22.75- to 9-plex 37 1.4 222 14.8 354 9.4 172 9.710 to 19 units 128 5.0 272 18.1 1182 31.5 258 14.520 to 49 units 253 9.9 232 15.4 929 24.8 189 10.650 + units 1694 66.4 68 4.5 538 14.3 459 25.8Mobile home 0 0.0 0 0.0 0 0.0 0 0.0Other 0 0.0 0 0.0 0 0.0 0 0.0

Total occupied: 2,841 100.0 2,350 100.0 4,272 100.0 2461 100.01, detached 65 2.3 990 42.1 357 8.4 706 28.71, attached 125 4.4 82 3.5 216 5.1 166 6.72 to 4 units 323 11.4 477 20.3 553 12.9 488 19.85- to 9-plex 46 1.6 222 9.4 373 8.7 178 7.210 to 19 units 141 5.0 279 11.9 1,182 27.7 270 11.020 to 49 units 253 8.9 232 9.9 941 22.0 189 7.750 + units 1,888 66.5 68 2.9 647 15.1 459 18.7Mobile home 0 0.0 0 0.0 0 0.0 5 0.2Other 0 0.0 0 0.0 3 0.1 0 0.0

Vacant/Vac. Rate: 80 2.7 38 1.6 98 2.2 52 2.11, detached 6 8.5 11 1.1 0 0.0 26 3.61, attached 0 0.0 0 0.0 0 0.0 0 0.02 to 4 units 12 3.6 4 0.8 22 3.8 0 0.05- to 9-plex 0 0.0 23 9.4 25 6.3 17 8.710 to 19 units 9 6.0 0 0.0 34 2.8 9 3.220 to 49 units 7 2.7 0 0.0 2 0.2 0 0.050 + units 46 2.4 0 0.0 15 2.3 0 0.0Mobile home 0 0.0 0 0.0 0 0.0 0 0.0Other 0 0.0 0 0.0 0 0.0 0 0.0

Sources: U.S. Census Bureau, Maxfield Research Inc.Note: Total units not equal to total households because data based on sample instead of 100% count.

Prospect Park

TABLE H2HOUSING STOCK BY UNITS IN STRUCTURE


Cedar-Riverside Marcy-HolmesComo



• Marcy-Holmes had a more diverse housing stock than Cedar-Riverside and Como. Single-family homes comprised only about 8.4% of the total stock, but 26.7% of the units are in buildings with less than 10 units. Units built as duplexes, tri-plexes, or four-plexes are com-mon, as are units that were originally single-family but were later subdivided. An additional 64.8% of units were in buildings with 10 units or more. Of all the housing types, only single-family detached homes had a higher proportion of owner-occupied units than renter-occupied

• In Prospect Park, 62.4% of occupied housing units were in buildings with less than 10 units,

with 28.7% of that total comprising of single-family detached units concentrated in the east-ern portion of the neighborhood. Of the remaining units, the largest portion (18.7%) were in buildings with 50 or more units, though it is likely that this proportion has increased since 2000 due to the addition of several large, student-oriented developments near the University of Minnesota.

Residential Construction Trends in the University District We estimated residential construction trends in the University District based on proprietary data about the rental and condominium markets in the University District and parcel data supplied by the City of Minneapolis via the University of Minnesota’s Center for Urban and Regional Affairs. Table H3 and the following graph show the number of housing units added by year in each of the four neighborhoods and Table H4 shows the number of housing units added in each type of housing. The following are key points from Table H3: • Between 2000 and 2008, Marcy-Holmes added the most housing units (+647 units), followed

closely by Prospect Park (+624 units). Cedar-Riverside added 143 units, while Como added 48 units.

• Total development peaked in the University District in 2002 and 2003, with about 64% (932

units) of the total development between 2000 and 2008 occurring just in these two years. A smaller jump in development occurred between 2005 and 2007 when development exceeded 130 units each year.

• No neighborhood had development in every year of the period. However, Como, Marcy-

Holmes, and Prospect Park had development in at least six of the eight years, whereas Cedar-Riverside experienced development only in 2000 and 2002.



Cedar- Marcy- ProspectYear Riverside Como Holmes Park Total

2000 3 1 68 0 722001 0 0 0 3 32002 140 2 60 287 4892003 0 5 221 217 4432004 0 1 0 0 12005 0 0 142 0 1422006 0 2 59 75 1362007 0 1 89 40 1302008 0 36 8 2 46

Total 143 48 647 624 1,462

Sources: City of Minneapolis; Maxfield Research Inc.

2000-2008UNITS ADDED IN THE UNIVERSITY DISTRICT BY YEAR

TABLE H3

Note: Does not account for demolitions.

Units Added in the University District, 2000-2008

0

50

100

150

200

250

300

350

2000 2001 2002 2003 2004 2005 2006 2007 2008

Year

Num

ber

of U

nits

Add

ed

Cedar-RiversideComoMarcy-HolmesProspect Park



The following are key points from Table H4: • Between 2000 and 2008, apartment development dominated overall development, accounting

for about 72% of the total units added in the University District. Marcy-Holmes and Pros-pect Park added about 440 apartment units each. Cedar-Riverside and Como accounted for the remaining 175 apartment units.

• Of the 143 units added in Cedar-Riverside, 140 were in GrandMarc at Seven Corners, a

student-oriented apartment development built in 2002.

Neighborhood Single-Family Apartment Condo/TH Duplex Other Total

Cedar-Riverside 0 140 0 2 1 143Como 13 35 0 0 0 48Marcy-Holmes 3 440 189 2 13 647Prospect Park 0 442 177 2 3 624Total 16 1,057 366 6 17 1,462


Structure Type

TABLE H4UNITS ADDED IN UNIVERSITY DISTRICT BY STRUCTURE TYPE

2000-2008

• Como experienced the largest amount of single-family housing development, although it is

likely some of these units replaced older units. The neighborhood’s 35 apartment units were in Project for Pride in Living’s (PPL) Charlotte Commons, part of a larger development called Van Cleve Commons. Since 2008, PPL completed Brook Commons, an additional 50 unit component of the larger development.

• In Marcy-Holmes, 97% of new units were apartments, condominiums or townhomes.

Condominium developments include Flour Sack Flats, Mill Trace Condominiums, and Phoenix on the River, all of which are in the western part of the neighborhood near the Mis-sissippi River. Apartment developments include 1301 University, Bierman Place, Marcy Park Apartments, and StoneArch Apartments. Only StoneArch Apartments does not attract primarily students. Limited development has occurred since 2008.

• Prospect Park has had similar building trends as Marcy-Holmes, with 99% of its new units

being apartments, condominiums, and townhomes. Larger condominium and townhome de-velopments include U-Flats, M-Flats, and East River Mews. Larger apartment developments include Stadium View Apartments (formerly The Melrose and later The District on Delaware) and University Commons, both of which are student-oriented developments near the Univer-sity of Minnesota campus.



Assessed Value of Housing Units Table H5 summarizes the assessed value and taxes as of 2008 of five housing types that com-monly have a mix of owner and renter occupants. Comparing the assessed values of homes-teaded properties (typically owner-occupied) and non-homesteaded properties (typically renter-occupied) is a useful way to evaluate differences in housing stock by tenure. It is important to note that homestead status is not a reliable indication of tenure in all cases, but is the best data available when Census data cannot be used. Below are key points from Table H5: • The highest overall assessed values for each of the five housing types were in Prospect Park.

Typical homes in the neighborhood are larger than in other University District neighbor-hoods.

• In most cases, the median and average assessed values are higher for homesteaded properties

than for non-homesteaded properties. This indicates that homesteaded properties are a com-bination of larger, better-maintained, or more recently-updated than non-homesteaded prop-erties.

• Average taxes are typically slightly higher for non-homesteaded properties both in terms of

the absolute amount and as a percent of the average value. Homestead status grants some tax advantages, which results in lower taxes for homesteaded properties.

Median Assessed Value University District 2008

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

Single-Family Condominium Townhouse Duplex Triplex

Housing Type

Ass

esse

d V

alue

Cedar-Riverside ComoMarcy-Holmes Prospect Park



TotalMedian Median Average Average Taxes as Pct. Median Average Average Taxes as Pct.

Housing Type Value Value Value Taxes of Avg. Value Value Value Taxes of Avg. Value

Single-Family $205,400 $223,700 $235,567 $4,048 1.7% $146,100 $118,889 $5,502 4.6%Condominium $165,200 $166,050 $165,110 $2,199 1.3% $157,400 $150,926 $2,221 1.5%Townhouse $195,800 $195,800 $198,611 $2,816 1.4% $204,800 $204,800 $2,090 1.0%Duplex $223,900 $249,500 $253,705 $3,597 1.4% $200,600 $198,450 $5,479 2.8%Triplex $278,250 $330,400 $330,400 $4,812 1.5% $247,600 $235,380 $10,302 4.4%

Single-Family $200,450 $201,500 $205,672 $2,975 1.4% $199,000 $196,824 $3,188 1.6%Condominium $86,400 -- -- -- -- $86,400 $76,992 $1,139 1.5%Townhouse -- -- -- -- -- -- -- -- --Duplex $261,850 $246,800 $264,037 $3,847 1.5% $265,200 $269,922 $4,996 1.9%Triplex $323,850 -- -- -- -- $323,850 $344,675 $6,209 1.8%


Single-Family $296,250 $305,900 $322,543 $4,816 1.5% $235,200 $243,289 $3,938 1.6%Condominium $228,700 $238,850 $243,769 $3,450 1.4% $226,500 $247,058 $3,655 1.5%Townhouse $268,350 $268,350 $285,117 $4,101 1.4% -- -- -- --Duplex $337,400 $347,600 $362,338 $5,379 1.5% $309,600 $312,838 $5,700 1.8%Triplex $417,900 $395,800 $392,210 $5,827 1.5% $489,700 $481,825 $8,708 1.8%


TABLE H5

Como

Marcy-Holmes

Prospect Park

2008

Non-HomesteadedHomesteaded

Cedar-Riverside

ASSESSED VALUE OF HOMESTEADED AND NON-HOMESTEADED PARCELS

Total


UNIVERSITY DISTRICT



• Cedar-Riverside consistently had the largest disparity between the assessed value of homes-teaded and non-homesteaded properties. The difference ranged from a low of homesteaded condominiums being valued $8,650 greater than non-homesteaded condominiums to a high of homesteaded triplexes being valued $82,800 greater than non-homesteaded triplexes.

• The average assessed value of a housing type is typically higher than the median assessed

value because high-valued properties disproportionately skew the average upward, while they have only a minimal effect on the median value.

Median Value by Housing Type in University District Homesteaded vs. Non-Homesteaded (2008)

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

Single-Family Condominium Townhouse Duplex TriplexHousing Type

Ass

esse

d V

alue

HomesteadedNon-Homesteaded

Relative Homestead Status Table H6 shows relative homestead status in the University District neighborhoods as of 2010. The data was obtained from the City of Minneapolis Assessor’s office. The State of Minnesota encourages home ownership by providing owner-occupied and qualified relative properties a reduction in their property taxes. For example, the homestead classification can reduce the taxes on a single-family residence up to $304 per year. The State of Minnesota also allows properties preferential homestead property tax treatment if the property is occupied by a relative of the owner. For purposes of “Relative Homestead,” the relative includes a parent, stepparent, child, stepchild, grandparent, grandchild, brother, sister, uncle, aunt, nephew or niece. The relationship may be either by blood or marriage. To qualify for the relative homestead classification, the relative must meet the following:

1.) Be a qualifying relative to one of the owners of the property;



2.) Occupy the property as a primary residence; and 3.) Be a Minnesota resident.

Due to the proximity to the University of Minnesota, there have been properties converted from owner-occupied into non-owner occupied relative homestead. In many instances, the parents of university students purchase the housing to unit to be occupied by their college-age children and other renters. The conversion of a regular homestead to a relative homestead classification reduces the homeownership rate as the owner no longer occupies the unit. Key points from Table H6 follow: • A total of 141 homes are classified as relative homestead in the University District. With a

household base of over 13,400, relative homestead properties account for only 1% of the households.

• The Como and Prospect Park neighborhoods had the highest number of relative homestead

properties (52). Cedar-Riverside had the least with 14 properties. • According to tax records, all of the relative homestead properties were purchased between

2001 and 2010. The average number of years is currently four to five, indicating owners are selling after their college-aged child graduates.

Avg. YearsNeighborhood Number From To Property Owned

Cedar-Riverside 14 2001 - 2009 4

Como 52 2001 - 2010 4

Marcy-Holmes 23 2001 - 2008 5

Prospect Park 52 2001 - 2008 5

Source: City of Minneapolis, CURA, Maxfield Research Inc.

Year Homesteaded

TABLE H6RELATIVE HOMESTEAD STATISTICS

2010

Neighborhood Staff Interviews Maxfield Research Inc. interviewed staff at each of the respective University District neighbor-hoods to solicit their impressions of the housing needs and challenges for each neighborhood. Neighborhood interviews were not completed at the Cedar-Riverside neighborhood due to the neighborhood group’s personnel transition. The following are key points from those interviews.



Marcy-Holmes • The Marcy-Holmes neighborhood has experienced a resurgence of residential and commer-

cial development over the past decade, in particular along the riverfront, near Central Avenue and near the University of Minnesota.

• There is concern regarding the number of properties that are non-homesteaded and selling for

high values due to the potential rental income from college students. It is the general feeling that these properties are not paying their equivalent property tax based on the high real estate values and rental incomes of these properties.

• The Marcy-Holmes neighborhood has expressed concern over the lack of code enforcement

from the City of Minneapolis. Due to budget constraints, the City has only one employee monitoring code enforcement for the University area.

• Housing developers, particularly student housing developers, are consistently seeking sites in

the Marcy Holmes neighborhood. It is the general feeling of the neighborhood that these high-density uses should be located adjacent to the University and not encroach on the lower-density areas west of Interstate 35W.

• A number of national student housing developers have approached the Marcy-Homes Neigh-

borhood Association as they pursue additional sites for future housing development. • Although the relationship between the University and the neighborhood has improved over

the years, the neighborhood feels there are future strides to make. The neighborhood feels the University has put more emphasis on community relations in North Minneapolis and the UMore Park project than the neighborhoods surrounding the University.

• Interstate 35W clearly divides the Marcy-Holmes neighborhood. East of Interstate 35W is

located on the doorsteps of the University, thus attracting mostly rental households. Howev-er, the propensity to have owner-occupied housing is much higher west of the Interstate.

• Generally most owner-occupied residents are content with the number of students in the

neighborhood. However, existing residents are concerned about landlords that violate occu-pancy codes and do not maintain their property.

• When asked about future housing needs for the neighborhood, the following housing types

were suggested:

o Owner-occupied duplexes o First-time home-buyer options o High-density housing along 15th Ave. near the University



Prospect Park • The condition of properties in the neighborhood has generally improved over the past decade.

Numerous homes have undergone substantial renovations and home improvements as there is pride among property owners. Many residents take part in community gardens as a way to improve the neighborhood.

• Due to a number of owner-occupied duplexes and other rentals, most landlords have been

responsible and maintain their properties. • The Pratt Community Center (Pratt Elementary School) is considered a key asset in the

Prospect Park neighborhood. Although Minneapolis Public Schools has been consolidating and eliminating schools throughout the City, the neighborhood feels strongly about maintain-ing this school.

• The relationship between the Prospect Park neighborhood and the University of Minnesota

has historically been strained as there is a “hard border” with the University. • There is concern in the neighborhood regarding increased density along the future light-rail

line planned for University Avenue. • Due to the current economic recession, it is believed many rental properties in the neighbor-

hood are having more difficulties leasing. Como • There are currently no projects moving forward. A proposed project at 21st and Como

Avenue was denied and a single-bedroom residential project by Elmwood Properties has been on hold due to financing reasons.

• Historically the Como neighborhood has attracted a wide-variety of householders and has

maintained a 50-50 owner-to-renter household type. However, the neighborhood has shifted towards a concentration of renters. Nonetheless, there recently has been an influx of first-time home buyers with young families seeking starter homes. Many of these buyers pur-chase for the proximity to employment in either of the Downtowns.

• There has been concern regarding the number of single-family properties converted into

rentals that are unpermitted. The neighborhood feels the City has not actively enforced these properties/landlords. If enforced, many landlords find it easier to pay the fine than remedy the deficiency in the property.

• Over the past decade there have been single-family tear-downs that were zoned a higher

density. New construction on the site was typically rental units with maximized densities.



• Like other neighborhoods in the University District, the Como neighborhood has no senior housing offerings. A common complaint among seniors is the ability to stay in the neighbor-hood as they age.

• The Como neighborhood primarily serves the undergraduate student body at the University

of Minnesota. There is a sense that this market is oversaturated as vacant housing units are becoming more prominent. As such, the neighborhood seeks to provide new housing stock for graduate students and university staff and faculty.

• During the height of the real estate boom there were a number of investors and speculators

flipping housing units in the neighborhood. Although the housing market bubble burst, most of these homes did not go into foreclosure due to the rental income these homes generate if they did not sell.

• Due to the high cost of housing near the University, a number of families have purchased

single-family homes for their children and their friends while they attend college. Typically these homes are classified as “relative homestead” but are not reclassified to non-homestead after the child graduates from college and moves from the home. Many of these homes are maintained as investment properties and are not sold after the child graduates.

• The vast majority of landlords take good care of their properties; especially those landlords

that also live in the neighborhood. Typically if an issue does arise, it is a deferred mainten-ance issue with a larger property management company who usually does not reside in the neighborhood.

• The relationship between the University and the Como neighborhood has improved over the

past five years. Although this relationship has become more synergistic, the neighborhood feels there is still a disconnect with the board of regents.

• Some single-family investors with rental vacancies have recently converted several homes to

Section 8 as a means to cash-flow the property. As a result, some of these Section 8 conver-sions have become “problem properties” in the neighborhood.

• The closure of the Tuttle Elementary School in the Como neighborhood has been a great loss

to the neighborhood. Many parents of children have opted for open-enrollment and have re-located to Marcy-Holmes, Pratt, or St. Anthony. As a result, marketing the neighborhood to prospective families has been more challenging with the loss of Tuttle and the state of the public school system in Minneapolis. Update: Since the time of the interview two Minneap-olis Public School programs have moved into Tuttle School.

FOR-SALE MARKET ANALYSIS


Introduction Maxfield Research Inc. analyzed the for-sale housing market in the University District by retrieving data on single-family and multifamily home sales and active listings; identifying pending for-sale developments; and conducting interviews with local real estate professionals, civic leaders, developers and planning officials directly involved in the local housing market to solicit their impressions of existing market conditions and trends. Home Resales Table H-1 displays data on home sales in the four University District neighborhoods from 2000 to 2009. The data was obtained from the Regional Multiple Listing Services of Minnesota and shows annual number of sales, median and average pricing, and average days of market. Table H-2 shows the median home resale price compared to all MLS districts in Minneapolis. It should be noted there is a slight overlap in neighborhoods hence the two tables do not reflect the same number of resales. The following are key points from table FSM-1: • Like the rest of the Twin Cities Metro Area and nationwide, the housing market in the

University District peaked in 2005, the peak of the real estate boom. The median sale price in the University District was $254,537 in 2005, an appreciation of over 75% from 2000.

• Although most areas in the Twin Cities experienced sales price declines between 2005 and

2008, pricing in the University District declined only slightly during this time. The median sales price did not experience a significant decrease until 2009; largely a result of lender-mediated properties. Approximately 39% of all transactions in 2009 were lender-mediated.

• Though the median sales price declined by -13% between 2008 and 2009 in the University

District, 2009 posted the highest number of transactions over the past decade. The high level of resales can be attributed to the 1st time home-buyer tax credit and depressed pricing from lender-mediated properties that were being purchased on a discount.

• All four neighborhoods observed declines in the median sales price between 2008 and 2009.

However, the decline varied by neighborhood, from -3% in Como to -23% in Cedar River-side. The University District’s median resale price declined from $247,756 to $216,172 in this time period (-13%). At the same time however, the average sales price increased by +25% to over $344,000.

• In 2009, the Marcy Holmes neighborhood accounted for nearly one-half of all resales in the

University District. Como accounted for about one-third of the transactions, followed by Prospect Park (13%) and Cedar Riverside (6%).



Median Average Avg. DaysNumber Selling % Selling % on Market

District Year of Sales Price Chg. Price Chg. (DOM)

Cedar-Riverside 2000 18 $132,000 -- $127,194 -- 162001 22 $167,150 27% $156,437 23% 222002 25 $152,000 -9% $148,254 -5% 442003 25 $155,000 2% $150,766 2% 412004 27 $175,000 13% $164,751 9% 572005 21 $174,900 0% $170,635 4% 742006 8 $124,750 -29% $128,088 -25% 972007 17 $155,000 24% $164,224 28% 1372008 14 $142,750 -8% $153,771 -6% 922009 10 $109,500 -23% $117,890 -23% 102

Marcy Holmes 2000 28 $153,478 -- $175,241 -- 212001 23 $188,000 22% $199,322 14% 162002 18 $235,950 26% $253,601 27% 372003 24 $237,400 1% $262,742 4% 302004 25 $247,500 4% $281,321 7% 582005 35 $253,000 2% $299,064 6% 692006 27 $266,900 5% $293,593 -2% 762007 48 $271,500 2% $281,875 -4% 722008 50 $311,450 15% $356,286 26% 592009 86 $243,000 -22% $502,405 41% 97

Prospect Park 2000 21 $170,000 -- $178,409 -- 252001 26 $225,000 32% $229,908 29% 292002 18 $234,700 4% $292,367 27% 452003 41 $250,000 7% $286,534 -2% 332004 46 $285,650 14% $300,050 5% 432005 26 $354,750 24% $360,958 20% 1032006 25 $279,900 -21% $323,040 -11% 692007 42 $268,675 -4% $277,935 -14% 592008 29 $249,900 -7% $278,772 0% 912009 23 $215,000 -14% $236,978 -15% 43

Como 2000 35 $129,000 -- $125,711 -- 162001 34 $155,950 21% $154,580 23% 182002 36 $175,500 13% $177,222 15% 122003 33 $185,000 5% $184,519 4% 142004 54 $202,000 9% $206,377 12% 242005 50 $236,950 17% $231,808 12% 462006 67 $220,000 -7% $226,075 -2% 702007 31 $224,000 2% $221,915 -2% 622008 38 $201,000 -10% $209,598 -6% 792009 58 $195,250 -3% $190,923 -9% 60

University District Total 2000 102 $144,690 -- $150,419 -- 382001 105 $182,415 26% $183,422 22% 502002 97 $191,646 5% $205,297 12% 672003 123 $210,793 10% $226,927 11% 292004 152 $230,003 9% $239,658 6% 672005 132 $254,537 11% $265,348 11% 1072006 127 $235,762 -7% $253,344 -5% 1242007 138 $245,618 4% $252,713 0% 1002008 131 $247,756 1% $274,933 9% 1532009 177 $216,172 -13% $344,123 25% 158

Sources: Regional Multiple Listing Service of Minnesota (MLS) Maxfield Research Inc.

TABLE FSM-1SINGLE-FAMILY AND MULTI-FAMILY RESIDENTIAL SALES

UNIVERSITY DISTRICT2000 through 2009



Residential Resale Trends - Combined Neighborhoods2000 to 2009

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009Year

Med

ian

Sale

s Pri

ce

0

20

40

60

80

100

120

140

160

180

200

# of

Res

ales

Median Selling PriceNumber of Sales

Median Resale Value by Neighborhood 2000 to 2009

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Year

Med

ian

Res

ale

Pric

e

Cedar-Riverside

Marcy Holmes

Prospect Park

Como



Area 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

University $148,000 $170,000 $179,000 $210,500 $235,000 $239,414 $240,000 $249,649 $204,000 $195,000

Calhoun-Isles $220,000 $248,700 $292,000 $287,900 $258,958 $255,000 $263,590 $264,900 $240,450 $230,000Camden $95,000 $116,950 $130,000 $144,900 $157,000 $163,900 $164,000 $123,375 $60,000 $51,900Central $146,000 $176,000 $233,000 $219,000 $267,000 $247,045 $270,000 $279,700 $276,890 $246,750Longfellow $124,950 $149,900 $169,900 $180,000 $199,900 $211,000 $207,500 $214,900 $188,000 $171,500Nokomis $139,900 $162,000 $179,650 $195,000 $210,000 $223,450 $225,000 $225,000 $208,000 $189,900North $78,900 $102,900 $121,950 $139,900 $149,900 $159,000 $153,000 $84,900 $44,763 $38,500Northeast $129,000 $146,000 $162,000 $179,950 $195,650 $205,900 $210,000 $197,880 $167,500 $151,000Phillips $85,950 $116,750 $129,950 $144,000 $167,750 $174,500 $191,580 $161,000 $88,725 $89,050Powerderhorn $110,000 $137,000 $157,000 $166,500 $182,300 $193,400 $183,700 $173,500 $119,700 $110,000Southwest $182,700 $210,000 $237,000 $257,500 $268,750 $285,000 $287,000 $310,000 $275,000 $260,000

Sources: Regional Multiple Listing Service of Minnesota (MLS), Maxfield Research Inc.

TABLE FSM-2HISTORIC MEDIAN RESALE PRICE IN MINNEAPOLIS

2000 to 2009



Minneapols Median Resales by Neighborhood 2000 to 2009

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Year

Med

ian

Res

ale

Pric

e

University

Calhoun-Isles

Camden

Longfellow

Nokomis

North

Northeast

Phillips

Powerderhorn

Southwest

• Home resale data for the University District through May 2010 reveals the median resale pricing decreasing to $185,000 from $204,500 in May 2009.

• As illustrated in Table FSM-2 and the correlating chart, the University District has main-

tained the 3rd highest median home resale price among the eleven MLS districts in Minne-apolis. Only the Calhoun-Isles and Southwest neighborhoods have posted higher median sales prices.

• The median sale price is generally a more accurate indicator of housing values in a communi-

ty than the average sale price. Average sale prices can be easily skewed by a few very high-priced or low-priced home sales in any given year, whereas the median sale price better represents the pricing of a majority of homes in a given market.

• Sales of bank owned properties have put downward pressure on prices of non-bank owned

properties. There have been 14 lender-owned and 10 short sale transactions in the University District since January 2009. Although the number of lender-mediated properties is lower in the University District compared to other Minneapolis neighborhoods, pricing still has de-clined



Current Supply of Homes on the Market Table FSM-3 shows the number of homes currently listed for sale as of June 2010 in the Univer-sity District by neighborhood, distributed into twelve price ranges. Table FSM-4 shows all active listings by housing type within each respective neighborhood. All data was compiled from the Regional Multiple Listing Services of Minnesota. Key findings from our assessment of the actively listed homes in the University District are: • A total of 93 homes were listed with the Regional Multiple Listing Service in the University

District. The median listing price for the University District was $301,130 and the average price was $414,910. The average and median prices are somewhat skewed due to the large number of homes prices above $500,000 in the Marcy Holmes neighborhood.

• The Marcy Holmes neighborhood accounted for 39% of all active listings in the University

District as well as the highest average and median for-sale prices. However, these high list prices reflect the luxury Phoenix condominium development that is still in its initial absorp-tion stage. Prospect Park accounts for about 27% of the listings whereas both Cedar-Riverside and Como account for 17% of the listings respectively.

• Nearly 50% of Prospect Park’s listings and 67% of Marcy Holmes listings are priced over

$300,000. There were no homes priced over $300,000 in Cedar Riverside and only 6% in Como.

Price Range No. Pct. No. Pct. No. Pct. No. Pct. No. Pct.

< $99,999 2 12.5% 3 8.3% 1 6.3% 1 4.0% 7 7.5%$100,000 to $124,999 3 18.8% 0 0.0% 0 0.0% 0 0.0% 3 3.2%$125,000 to $149,999 4 25.0% 1 2.8% 0 0.0% 2 8.0% 7 7.5%$150,000 to $174,999 2 12.5% 1 2.8% 4 25.0% 2 8.0% 9 9.7%$175,000 to $199,999 3 18.8% 1 2.8% 3 18.8% 5 20.0% 12 12.9%$200,000 to $249,999 1 6.3% 5 13.9% 2 12.5% 1 4.0% 9 9.7%$250,000 to $299,999 1 6.3% 1 2.8% 5 31.3% 2 8.0% 9 9.7%$300,000 to $349,999 0 0.0% 3 8.3% 1 6.3% 7 28.0% 11 11.8%$350,000 to $399,999 0 0.0% 3 8.3% 0 0.0% 4 16.0% 7 7.5%$400,000 to $449,999 0 0.0% 2 5.6% 0 0.0% 0 0.0% 2 2.2%$450,000 to $499,999 0 0.0% 2 5.6% 0 0.0% 1 4.0% 3 3.2%$500,000 and Over 0 0.0% 14 38.9% 0 0.0% 0 0.0% 14 15.1%

16 100% 36 100% 16 100% 25 100% 93 100%

MinimumMaximum

MedianAverage

Sources: Regional Multiple Listing Service of MN Maxfield Research Inc.

Cedar-Riverside Prospect Park

$94,900$259,900

Marcy Holmes SE Como

$89,900$349,000

$84,900$3,999,990

$269,262$137,400$150,744

$422,445$719,149

$209,450$222,113

$289,900$464,900$94,900

$414,910

TABLE FSM-3HOMES CURRENTLY LISTED FOR-SALE

UNIVERSITY DISTRICTJune 2010

Total

$84,900$3,999,990$301,130



Active Listings for Sale in Univesity District June 2010

0

2

4

6

8

10

12

14

16

18

20

Under$100,000

$100,000 to$149,999

$150,000 to$199,999

$200,000 to$249,999

$250,000 to$299,999

$300,000 to$399,999

$400,000 andOver

Listing Price

# of

List

ings

Prospect Park Cedar-Riverside

Marcy Holmes SE Como

• Due to the proximity to the University of Minnesota, the University District has been some-what “housing recession proof” compared to other neighborhoods in Minneapolis and throughout the Twin Cities. This is in part due to the high rental demand from University students and faculty who seek properties near the University, resulting in high demand from real estate investors and traditional buyers. As a result, the number of listings in the neigh-borhood is low as the supply has historically been absorbed rapidly.

• Approximately 40% of homes for sale in the University District are listed for $200,000 or

less. With a list price of $200,000, a household would need an income of approximately $66,000 to afford a home if the household spent 3.0 times its annual income. About 26% of all University District households have an income of at least $66,000.

• In the University District, condominiums account for about 58% of all active listings and

over 80% of all listings in the Cedar Riverside and Marcy Holmes neighborhoods. Single-family listings account for all of the homes for sale in the Como neighborhood.



Neighborhood No. Pct. No. Pct. No. Pct. No. Pct.

Cedar Riverside 3 18.8% 0 0.0% 13 81.3% 16 100.0%

Marcy Holmes 3 8.3% 2 5.6% 31 86.1% 36 100.0%

Como 16 100.0% 0 0.0% 0 0.0% 16 100.0%

Prospect Park 11 44.0% 4 16.0% 10 40.0% 25 100.0%

Total 33 35.5% 6 6.5% 54 58.1% 93 100.0%

Source: Regional Multiple Listing Service of MN; Maxfield Research Inc.

TABLE FSM-4ACTIVE LISTINGS IN UNIVERSITY DISTRICT BY HOUSING TYPE

June 2010

Single-Family Townhome Condominium Total

Actively Marketing & Recently Completed For-Sale Multifamily Housing Developments in the University District Table FSM-5 inventories recently completed and actively marketing for-sale multifamily devel-opments in the University District over the past five years. The table depicts original pricing when developed, actively marketing pricing, and resale pricing in 2010. The following are key points regarding newer multifamily for-sale developments. • Phoenix on the River is the newest for-sale multifamily development in the University

District. The luxury condominium project is one of the few actively marketing properties in Minneapolis and the entire Metro Area. As of July 2010, the project had sold or had pur-chase agreements on 77% of the units. According to the developer, mostly high-end units are available for purchase as the lower-priced river view units sold first.

• Excluding the Cobolt that borders the Marcy-Holmes neighborhood, all of the completed

projects were completed in either the Marcy-Holmes or Prospect Park neighborhoods. No new for-sale multifamily has been recently developed in Como or Cedar-Riverside.

• Resale units currently marketing or recently sold are priced less than the original sales prices

when developed. Most of the projects were completed in 2005 and 2006, the peak of the real estate boom.

• University Flats and M Flats were marketed to students, parents of students, faculty, and

others who had an affiliation with the University of Minnesota. Although University Flats sold out in a matter of months in late 2005, the M Flats caught the real estate downturn and sold only 50% of the original units. As a result, the building is now in foreclosure.

• East River Mews in Prospect Park is the only recently completed project with a townhome

concept. Due to the large unit sizes, the project boasts one of the lowest price per square foot costs in the University District.



Projct Into./ Year TotalNeighborhood Open Units Comments

Actively MarketingPhoenix on the River 2009 79Marcy-Holmes (61 sold)

2 - 1BR $389,000 - $409,000 1,130 - 1,130 $344 - $3621 - 1BR+D 1,350 - 1,350 n/a n/a9 - 2BR $449,000 - $599,000 1,350 - 1,875 $333 - $3195 - 2BR+D $549,000 - $849,000 1,740 - 2,620 $316 - $324

2 - 1BR $389,000 - $409,000 1,130 - 1,130 $344 - $3628 - 1BR+D $429,000 - $589,000 1,300 - 1,480 $330 - $3989 - 2BR $499,000 - $729,000 1,615 - 2,015 $309 - $362

33 - 2BR+D $599,000 - $1,599,000 1,700 - 2,740 $352 - $5841 - 3BR $699,000 - $699,000 2,045 - 2,045 $342 - $3429 - 3BR+D $629,000 - $2,299,000 2,800 - 3,800 $225 - $6053 - PH $2,499,900 - $3,749,000 5,830 - 6,290 $429 - $596

2 - 1BR $349,990 - $449,990 1,130 - 1,480 $310 - $3049 - 2BR $449,900 - $749,900 1,590 - 2,320 $283 - $3234 - 3BR+ $649,900 - $3,999,990 2,160 - 6,254 $301 - $6402 - PH $2,999,990 - $3,499,990 5,860 - 6,058 $512 - $578

Newer Projects Cobolt 2006 93(Just outside Marcy- 37 - 1BR $243,000 - $379,000 865 - 1,137 $281 - $333Holmes) 8 - 1BR+D $389,000 - $489,000 1,093 - 1,488 $356 - $447

36 - 2BR $415,000 - $699,000 1,257 - 1,739 $330 - $4029 - 2BR+D $509,000 - $953,000 1,506 - 2,118 $338 - $4503 - PH $1,665,000 $2,155,000 2,776 - 4,228 $600 - $510

1 - 2BR+D1 - Pent. Shell

1 - 1BR1 - 2BR2 - 2BR+D $599,900 - $990,000 1,935 - 4,033 $245 - $310

Flour Sack Flats 2005 49Marcy Holmes 21 - 1BR $211,900 - $305,900 790 - 1,050 $268 - $291

1 - 1BR+D $274,900 - $274,900 1,026 - 1,026 $268 - $26832 - 2BR $304,900 - $430,900 1,070 - 1,491 $285 - $289

4 - 3BR $464,900 - $656,900 1,384 - 1,965 $336 - $334

1 - 1BR1 - 2BR

3 - 1BR $218,900 - $234,900 785 - 846 $278 - $2793 - 2BR $309,900 - $394,900 1,107 - 1,139 $280 - $3471 - 3BR

Only actively marketing for-sale development in the Unversity District. Luxury high-rise condominium overlooking the Mississippi River and adjacent to St. Anthony Main and The Pillsbury Mill complex. As of July 2010, 61 units were sold or under purchase agreement.

East Bank location adjacent to the Pillbury Mill area and Stone Arch Apts. Southern facing units overlook Mississippi River. 60% of units sold in 2005 and 2006, 95% sold by 2008.

Broke ground in September 2005, occupancy early 2007. Lunds Grocery store opened November 2006; the drugstore/pharmacy opened in December 2006. Over 50% of the units sold in 2005, project was 93% sold by 2007.

CONTINUED

RESALE PRICING (SOLD TRANSACTIONS IN 2010)


CURRENT PRICING (ACTIVE LISTINGS)


1,945 $275

Original Unit Mix

OriginalSales Price

Unit Size(Sq. Ft.)

Price/(Sq. Ft.)

TABLE FSM-5ACTIVELY MARKETING & RECENLY COMPLETED MULTIFAMILY FOR-SALE DEVELOPMENTS

UNIVERSITY DISTRICTAUGUST 2010

$535,000

$246$303

1,116 $255$409,500 1,368 $299

3,942 $254$1,000,000

$499,900 1,965 $254

$208,000$335,000


ORIGINAL PRICING

ORIGINAL PRICING

8461,107

$284,900

ORIGINAL PRICING

Caretaker

Main Street Homes

Tower Homes



Projct Into./ Year TotalNeighborhood Open Units Comments

East River Mews 2005 52 14 units sold in 2004 and remaining units sold in 2005 and early 2006.Prospect Park (38 TH)

(16 Condo) n/a - 1BR $183,500 - $195,000 805 - 892 $219 - $228n/a - 2BR $299,900 - $400,000 1,255 - 1,883 $212 - $239

n/a 2BR+ $400,000 - $525,000 1,865 2,402 $214 - $219

2 - 2BR $300,000 - $305,000 1,516 - 1,763 $173 - $1981 - 3BR

3 - 2BR $311,900 - $335,000 1,642 - 2,144 $156 - $1901 - 3BR

University Flats 2006 76Prospect Park 8 - Studios

8 - 1BR $138,700 - $155,900 $205 - $23133 - 2BR $230,000 - $288,900 734 - 899 $313 - $32116 - 3BR $260,000 - $356,000 1,031 - 1,082 $252 - $32911 - 4BR $335,000 - $360,000 1,189 - 1,362 $264 - $282

1 - 2BR1 - 3BR

4 - 1BR $94,900 - $177,450 500 - 675 $190 - $2632 - 2BR $189,900 - $217,900 899 1,027 $211 - $212

M Flats 2007 75Prospect Park 5 - Studio $109,900 - $125,000 $249 - $283

5 - 1BR $175,000 - $220,000 708 - 805 $247 - $27345 - 2BR $206,500 - $299,900 912 - 1,224 $226 - $245

8 - 2BR $182,000 - $209,000 974 - 1,034 $187 - $202

1 - 1BR4 2BR $189,900 - $219,900 912 - 1,034 $208 - $213

Sources: Northstar MLS, Maxfield Research Inc.

Marketing began in Fall 2005 and sold out in early 2006. Building was occupied in Sept. 2006.

Marketing began in Spring 2006. The developer only sold about 50% of the original units. The building is now in foreclosure

Unit Mix Sales Price (Sq. Ft.) (Sq. Ft.)Original Original Unit Size Price/

TABLE FSM-5

ACTIVELY MARKETING & RECENLY COMPLETED MULTIFAMILY FOR-SALE DEVELOPMENTSUNIVERSITY DISTRICT

AUGUST 2010

CONTINUED


ORIGINAL PRICING

$340,000 2,447 $139


$119,900 $240

ORIGINAL PRICINGCondominium

Townhomes

$335,000 2,138 $157



$218

ORIGINAL PRICING


442


$169,900 805 $211

500675

$206,000 900 $229$225,000 1,031



For-Sale Interviews Summary Maxfield Research Inc. interviewed area real estate agents, local developers, builders, neighbor-hood personnel, and other persons familiar with the University District’s owner-occupied market to solicit their impressions of the current for-sale housing market in the community. The follow-ing are key points from those interviews. • Many interviewees commented on the inability to attract “traditional buyers” to the neigh-

borhood. The vast majority of traffic through open houses and listing activity has been from investors and/or parents of college age students.

• Parents of college-aged kids attending the University of Minnesota have become increasing

active in purchasing real estate near the University for their child and their roommates. Par-ents find their child can live “rent free” by subsidizing the mortgage and housing expenses through the child’s roommates. The average rent ranges from about $450 to $600 per stu-dent, less than most multifamily properties. Many of these types of buyers hold the property for about 5-6 years and sell the asset after the student graduates from college. Parents like the safety, availability of parking, and proximity to campus.

• Open house activity at many University District listings has been dominated by parents of

children and a small proportion of investors. There have been few “traditional buyers” at these open houses. This is a trend many Realtors commented on and is expected to continue during the current downturn in the real estate market.

• Interviewees commented on the central location and proximity to employment, the Universi-

ty of Minnesota, Downtown Minneapolis, and convenient transportation availability. Al-though the University District has numerous amenities, the neighborhood is attracting fewer “traditional buyers” such as professionals working for the University, recent college gra-duates, families, etc. Many of these potential buyers do not seek the lifestyle of living next to college students, perceived crime, etc. In addition, housing costs are higher than other Min-neapolis neighborhoods.

• The University District has not been immune from the recession and housing collapse.

Although resale activity and pricing is down, the neighborhoods have maintained stronger sales pricing than most neighborhoods in Minneapolis and throughout the Metro Area. The neighborhood continues to be sought after and a high-demand location.

• Although there are a number of “slum landlords” operating properties to University students,

there are a number of “good landlords” that maintain and renovate their properties in the University District. However, the perception is that all investors are poor stewards and do not improve the property and neighborhood.

• One investor commented on the difficulty of rezoning properties in the City of Minneapolis

due the “strict” zoning code. Some property owners have proposed housing redevelopment options on distressed properties that have not been approved by the City.



• Most Realtors agree real estate pricing in 2011 will be flat at best and transaction activity will remain similar to 2010. The real estate market is still in “correction mode” and is expected to remain soft in the short-term. This will continue the trend of fewer traditional buyers than investors and parents of University students.

RENTAL MARKET ANALYSIS


Introduction Maxfield Research Inc. identified and surveyed a sample of rental properties with twelve or more units in the University District. In addition, interviews were conducted with real estate agents, rental housing management firms, private owner landlords, and others in the community familiar with the University District’s rental housing stock. For purposes of analysis, we have classified rental properties into two groups: general occupan-cy and senior (age restricted). All senior properties are included in the Senior Rental Analysis. The general occupancy rental properties are divided into three groups: market rate (those without income restrictions), student-oriented (those occupied exclusively by students), and affordable/subsidized (those with income restrictions on tenants and rents below market rate) Although it was beyond the scope of the study to inventory and aggregate the number of scat-tered single-family homes that are rented in the University District, Maxfield Research Inc. did interview some private homeowners on the properties that they manage to get a rough gauge of the single-family home, duplex, and triplex rental market. We are well aware of the role these homes play in the general occupancy rental housing market. Rented single-family homes, duplexes, triplexes, and general occupancy market rate apartments compete for some of the same target markets. Results of the survey can be found in the Rental Market Interview Summary. Overall Minneapolis Market Conditions Table RM1 shows general market data for the City of Minneapolis as a whole as well as East Minneapolis, which includes most of the University District (however East Minneapolis also includes Northeast Minneapolis), and Downtown Minneapolis. The data is for comparing the University District to broader rental markets. The data is provided by GVA Marquette Advisors. The following are key points from Table RM1: • Rental markets are considered to be stabilized when they have a 5.0% vacancy rate, which

promotes competitive rents, ensures adequate consumer choice, and allows for unit turnover. As of 2nd Quarter 2010, the City of Minneapolis as a whole had an overall vacancy rate of 6.5%, indicating that the market is somewhat weak as a result of economic challenges. Downtown Minneapolis, with a vacancy rate of 8.4%, was faring significantly worse, while East Minneapolis had a relatively low rate of 2.9%.

• East Minneapolis consistently has very low vacancy rates, largely due to the high demand for

rental housing created by students at the University of Minnesota and Augsburg College. Average rents are slightly lower than the City of Minneapolis as a whole and significantly lower than Downtown Minneapolis due to the generally older and smaller housing stock in the area.



Overall Avg. Rent Inc.Community Studio 1BR 1BR/D 2BR 2BR/D 3BR Average 12 mos.

City of Minneapolis2nd Quarter 2009 Rent $645 $840 $1,356 $1,207 $2,262 $1,468 $916 Vacancy Rate 4.5% 4.0% 22.5% 5.2% 5.9% 3.7% 4.6%2nd Quarter 2010 Rent $683 $884 $1,385 $1,256 $2,096 $1,489 $953 1.9% Vacancy Rate 5.6% 6.5% 7.7% 7.4% 0.0% 3.1% 6.5%East Minneapolis2nd Quarter 2009 Rent $608 $742 $925 $1,001 -- $1,283 $850 Vacancy Rate 1.6% 1.7% 3.7% 4.5% -- 3.5% 2.7%2nd Quarter 2010 Rent $676 $775 $924 $1,012 -- $1,285 $863 1.5% Vacancy Rate 1.4% 2.6% 3.7% 4.5% -- 0.0% 2.9%Downtown Minneapolis2nd Quarter 2009 Rent $666 $1,072 $1,439 $1,666 $2,325 $2,427 $1,144 Vacancy Rate 4.9% 4.8% 32.1% 6.9% 11.1% 5.0% 6.0%2nd Quarter 2010 Rent $688 $1,116 $1,501 $1,738 $2,125 $2,448 $1,203 5.2% Vacancy Rate 6.2% 8.1% 6.2% 11.5% 0.0% 5.0% 8.4%

TABLE RM1AVERAGE RENTS/VACANCIES IN MINNEAPOLIS SUBMARKETS

2nd Quarter 2009 and 2nd Quarter 2010

Sources: GVA Marquette Advisors Inc.; Maxfield Research Inc. Market Rate Properties Our research of the University District’s general occupancy rental market included a survey of 2,197 units in 48 developments in the four neighborhoods. To conduct the survey, we contacted all apartments with more than 12 units that were advertising units or that had permanent signs with a contact phone number at the time of our neighborhood fieldwork in early July 2010. When a property owner or manager of one of these properties owned or managed other proper-ties in the University District, we also surveyed the additional properties. The final sample, while not exhaustive, is sufficiently large to draw conclusions about the general occupancy rental market in the University District. Table RM2 on the following page summarizes the overall market rate general occupancy rental market in the University District. Table RM3 shows each development that was surveyed and provides a summary for each of the four neighborhoods. As Table RM2 shows, the vacancy rate among the sampled apartments in the University District was 3.8% in July 2010, indicating somewhat high demand in the area as a whole. Of all the units surveyed, 95.4% were two-bedrooms or smaller, with one-bedroom units being the most com-mon (45.6% of the total). Average rents for each unit type were slightly less than the East Minneapolis average with the exception of three-bedroom units. Four-bedroom units were not surveyed by GVA Marquette Advisors. Table RM3 and key points about each neighborhood follow.



Number Pct. of Avg. Avg. VacancySurveyed Total Rent Size Rate

Studio 322 14.7 $639 450 --1BR 1002 45.6 $763 665 --2BR 774 35.2 $1,053 943 --3BR 89 4.1 $1,500 1,191 --4BR 10 0.5 $2,078 1,368 --Total 2,197 3.8%


July 2010UNIVERSITY DISTRICT

GENERAL OCCUPANCY RENTAL MARKET SUMMARYTABLE RM2

Cedar-Riverside • There are very few market rate developments in the neighborhood, which is instead dominat-

ed by subsidized and affordable housing and non-residential uses. • Of the 841 units surveyed, 42 were vacant for a vacancy rate of 5.0%. While the vacancy

rate suggests a stable market, it is important to note that all of the vacancies are in Riverside Plaza. The apartment complex currently suffers significant maintenance issues due to low quality construction. Although the owner, Sherman Associates, is in the process of securing funding to complete major rehabilitation work, the condition of the development may be im-pacting occupancy. The fully occupied properties at the other three developments indicate very high demand in the neighborhood for market rate rental housing.

• Both Riverside Plaza and Seven Corners Apartments have large supplies of affordable and

subsidized units. The Seven Corners Apartments include 149 affordable units for households making 50% to 60% of the area median income. Rent is reduced 10% from the market rate rents. Riverside Plaza includes 669 project-based Section 8 units in addition to its 634 mar-ket rate units. However, a portion of its market rate units are occupied by residents with Housing Choice Section 8 Vouchers.

• Of the four neighborhoods in the University District, Cedar-Riverside has the lowest priced

studio, two-bedroom, three-bedroom, and four-bedroom units, though comparisons of four-bedroom prices are less indicative of overall market trends because only 10 were identified at two developments in the University District. The neighborhood’s one-bedroom units were the most expensive in the University District.



Como • Small rental developments dominate the general occupancy rental market in Como, with the

largest market rate development, Cole Townhomes, having only 36 units. In these develop-ments one- and two-bedroom units are the most common, comprising 78.1% of the total units. There were only two studio units and 24 three-bedroom units among the surveyed properties.

• Como is the only neighborhood in the University District with a vacancy rate above market

equilibrium at 5.5% vacant. However, the rate remains below that of the City of Minneapolis as a whole, indicating the comparable health of the Como rental market.

• With an average monthly rent of $699, Como’s one-bedroom units are the most affordable in

the University District. Its other units are priced slightly higher, but no unit style is the most expensive of their type.

• Students are common renters in Como, but are not the only renters. Every property where

the manager was willing to discuss the tenant mix had some students, while five out of 11 claimed to be primarily composed of students. It is also possible that any apartment that claimed to be primarily students is actually completely students because many landlords were unwilling to be specific due to Fair Housing Act regulations that prohibit discrimination in housing. Families are unusual in the apartment buildings due to the relative lack of units larger than two-bedrooms.

Marcy-Holmes • The neighborhood has a far greater number of apartment developments than the other three

neighborhoods. Most properties are under 30 units, but there are several larger market rate developments. Of the 913 units surveyed, there were just 22 vacancies for a vacancy rate of 2.4%. Fourteen of the 29 developments surveyed (48.3%) had no vacancies, and many lan-dlords commented that they would remain fully occupied for the next year based on signed leases. The very low vacancy rates indicate extremely high demand for rental housing in the neighborhood.

• Rental properties in the neighborhood are heavily marketed to students at the University of

Minnesota. Students formed at least a portion of the tenant base at every property surveyed, and in many cases formed almost the entire tenant base. Most apartments have their leases coincide with the school year, and the marketing materials are geared toward students.

• Units are typically priced slightly above the average prices for the University District.

However, three-bedroom units are priced significantly above the average ($1,500) at $1,700 per month. All unit types except studios are considerably smaller than the University District average.



• With the exception of Marcy Park Apartments and Stone Arch Apartments, which were built in 2002 and 2003, respectively, the majority of the apartments surveyed in Marcy-Holmes were built during the 1960s and 1970s, with the most recent being built in 1976.

Prospect Park • Prospect Park is the only neighborhood with a significant number of owner-occupied, single-

family homes, and has the smallest number of market rate apartment developments. Of the 242 units that were surveyed at four properties, there were just eight vacancies for a vacancy rate of 3.3%. The vacancy rate may be slightly lower because there were a number of small apartment buildings with no contact information or rent signs present, which may suggest that they are fully occupied.

• Of the surveyed units, they were typically priced close to the University District averages,

while being considerably larger, though the value for size may not adequately reflect the neighborhood because data was not available for two of the four developments.

• Tenants at the two developments near the University of Minnesota, 614 Huron Boulevard

and Stadium Village Apartments, are primarily students whereas tenants at the two develop-ments more distant from the campus, Thornton Place Apartments and Yale Place Apart-ments, are far more mixed. The latter two are relatively isolated from the University of Min-nesota compared to most parts of the University District, so are more popular with non-students than students.



Year TotalProject Name/Addr./Mgmt. Built Units Vacant Resident Profile Description/Comments

Karinsplass Apartments 1992 38 0 1 - Studio Primarily students2015 Riverside Avenue 0.0% 21 - 1BR $890 - $960 689 - 773BDC Management 16 - 2BR $1,135 - $1,255 934 - 1,083

Riverside Plaza 1973 634 42 192 - Studio $520 - $620 335 - 544 Mix1600 6th Street S (1,303) 6.6% 511 - 1BR $745 - $820 493 - 1,005Sherman Associates 534 - 2BR $770 - $970 718 - 1,375

58 - 3BR $1,295 - $1,345 957 - 1,3758 - 4BR 1,353 - 1,538

Seven Corners Apartments 1984 99 0 13 - Studio $630 - $6551400 2nd Street S (248) 0.0% 39 - 1BR $750 - $820BDC Management 42 - 2BR $955 - $1,020

5 - 3BR $1,265 - $1,340

The Studios at Seven Corners -- 70 0 68 - Studio --1414 3rd Street S 0.0% 2 - 1BRHartley Properties

Total/Average* 841 42 175 - Studio5.0% 311 - 1BR

318 - 2BR33 - 3BR

4 - 4BR

1005 15th Avenue SE 1958 12 1 6 - 1BR Mix1005 15th Avenue SE 8.3% 6 - 2BRIndividual

1100 Como Avenue SE 1961 23 0 23 - 1BR Primarily students1100 Como Avenue SE 0.0%Elmwood Properties

1313 Como Avenue SE 1974 13 0 2 - Studio Primarily students1313 Como Avenue SE 0.0% 2 - 1BRElmwood Properties 9 - 2BR

1319 Hennepin Avenue 1970 16 1 12 - 1BR Mix1319 Hennepin Avenue 6.3% 4 - 2BRChristopherson Properties

$1,595

Total of 1,303 units; 669 are project-based Section 8 and 634 are market rate. Section 8 units not static, so unit mix reflects entire building. Section 8 Housing Choice Vouchers are also accepted.

Units feature dishwashers, air conditioning. Includes internet, heat, parking, water, garbage.

800700

$750$625 Units features AC, ceiling fans. Building

features laundry, storage, off-street parking. Heat, water, trash included.

950650550

$1,260$775$695

Units feature AC, some hardwood floors.

$775 550 Units feature dishwashers, AC. Includes internet, heat, parking, water, garbage.

----

$830$700

Units features AC, carpet. Building features pool, UG parking, internet lounge. Heat, water, trash, recycling, parking included.

850450

$1,200$700

497

480 Mix including students, professionals, seniors, families.

Units feature AC, some feature patio or balcony. Building features laundry, fitness center, picnic areas, tanning, party room. Building also includes 149 affordable units.1020

760550

Units feature AC. Underground parking $55 per month.

Como

UNIVERSITY DISTRICTMARKET RATE GENERAL OCCUPANY RENTAL DEVELOPMENTS

TABLE RM3

Cedar-RiversideUnit Mix Rent Ranges Unit Size

July 2010

$645

447

$1,595$1,317$902$795$626

1,4461,1441,007723

-- Continued on next page --



Year TotalProject Name/Addr./Mgmt. Built Units Vacant Resident Profile Description/Comments1405 Como Avenue SE 1960 12 1 6 - 1BR Mix1405 Como Avenue SE 8.3% 6 - 2BRMailand Management Corp.

1409 Como Avenue SE 1958 12 0 6 - 1BR Mix1409 Como Avenue SE 0.0% 6 - 2BRMailand Management Corp.

1701 Elm Street SE 1987 22 0 22 - 2BR 800 - 850 Primarily students1701 Elm Street SE 0.0%Elmwood Properties

1725 Elm Street SE 1987 22 0 22 - 2BR 800 - 850 Primarily students1725 Elm Street SE 0.0%Elmwood Properties

319 Garfield Street NE 1971 16 2 12 - 1BR Mix --319 Garfield Street NE 12.5% 4 - 2BRChristopherson Properties

Cole Townhomes 1989 36 5 12 - 2BR Mix2425-2647 Cole Avenue SE 13.9% 24 - 3BRRiverton Community Housing

Como Avenue Apartments 1966 17 1 5 - 1BR Primarily students1122 Como Avenue SE 5.9% 12 - 2BRBT&A Apartment Management

Total/Average 201 11 2 - Studio5.5% 72 - 1BR

85 - 2BR24 - 3BR

1415 University Avenue SE 1976 12 1 5 - 1BR --1415 University Avenue SE 8.3% 7 - 2BRIrving Properties

209 5th Street SE 1968 26 1 15 - 1BR $700 - $750209 5th Street SE 3.8% 11 - 2BR $925 - $1,000St. Anthony Apartments

309 6th Street SE 1966 39 0 6 - Studio $625 - $650309 6th Street SE 0.0% 21 - 1BR $700 - $750St. Anthony Apartments 12 - 2BR $925 - $1,000


July 2010

Unit Mix Rent Ranges Unit Size

TABLE RM3 (continued)MARKET RATE GENERAL OCCUPANY RENTAL DEVELOPMENTS

UNIVERSITY DISTRICT

1,440899624550

$1,500$1,086$699$695

Units feature AC, some hardwood floors.

$830$700

---- Units feature AC, some hardwood floors.

$830$700

----

$1,260 Units feature dishwashers, AC, hardwood floors. Includes internet, heat, parking, water, garbage.

Units feature dishwashers, AC, hardwood floors. Includes internet, heat, parking, water, garbage.

800700

$750$625

$1,260

Units feature washer, dryer, dishwasher, disposal. Parking, water, trash included.

784591

$812$669 Builidng features internet, laundry, storage

lockers.

1,4401,310

$1,500$1,200

Marcy-Holmes

$1,200$675 --

--Units feature AC, dishwasher. Heat, water, parking included.

AC in all units, dishwashers in some. Heat, water, trash, one surface parking stall included.820

600

820600450 AC in all units, dishwashers in some. Heat,

water, trash, one surface parking stall included.

Mix with many students




Year TotalProject Name/Addr./Mgmt. Built Units Vacant Resident Profile Description/Comments310 8th Street SE 1968 18 0 9 - 1BR --310 8th Street SE 0.0% 9 - 2BRIrving Properties

318 8th Avenue SE 1953 21 0 13 - Studio $685 - $695 Primarily students318 8th Avenue SE 0.0% 8 - 1BR $775 - $800Classic City Apartments



326 6th Avenue SE 1967 27 2 14 - 1BR $660 - $670 Primarily students326 6th Avenue SE 7.4% 13 - 2BR $870 - $880Steven Scott Management

327 University Avenue SE 1960 19 1 17 - 1BR $660 - $670 Primarily students327 University Avenue SE 5.3% 2 - 2BR $870 - $880Steven Scott Management

400 6th Avenue SE 1963 26 0 5 - Studio $625 - $650400 6th Avenue SE 0.0% 18 - 1BR $700 - $750St. Anthony Apartments 3 - 2BR $925 - $1,000


410 6th Street SE 1964 38 5 2 - Studio Primarily students410 6th Street SE 13.2% 17 - 1BR $660 - $670Steven Scott Management 17 - 2BR $870 - $880

2 - 3BR

425 University Avenue SE 1963 23 1 23 - 1BR $700 - $750425 University Avenue SE 4.3%St. Anthony Apartments

4th Street Apartments 1966 12 1 12 - 1BR $647 - $667 Mix316 4th Street SE 8.3%BT&A Apartment Management




MARKET RATE GENERAL OCCUPANY RENTAL DEVELOPMENTSTABLE RM3 (continued)

561 Builidng features internet, laundry, storage lockers.

$1,150

$625 Units feature AC. Building features laundry, off-street parking. Heat included.

650 AC in all units, hardwood floors in some. Heat, water, trash, one surface parking stall included.


1,000900625400


water, trash, one surface parking stall included.Mix with many students

AC in all units, hardwood floors in some. Heat, water, trash, one surface parking stall included.

820650450 Mix with many

students

Units feature AC, dishwasher. Heat, water, parking included.$900

$725----

Recently renovated with new carpeting, tiling, appliances. Building includes laundry room. Heat, water, trash, recycling included.

----


water, trash, one surface parking stall included.Mix with many students

AC in all units, dishwashers in some. Heat, water, trash, one surface parking stall included.

820600450 Mix with many

students

900625 Units feature AC. Building features laundry,

off-street parking. Heat included.

925625 Units feature AC, hardwood floors. Building

features laundry, off-street parking. Heat included.



Year TotalProject Name/Addr./Mgmt. Built Units Vacant Resident Profile Description/Comments4th Street Cooperative 1963 16 1 4 - Studio $600 - $610 Mix1227 4th Street SE 6.3% 11 - 1BR $700 - $725Riverton Community Housing 1 - 2BR

515/521/527 5th Avenue SE 1898 18 1 18 - 2BR $1,130 - $1,140 Mix515/521/527 5th Avenue SE 5.6%Individual

519 3rd Avenue SE 1967 42 2 3 - Studio $625 - $650519 3rd Avenue SE 4.8% 25 - 1BR $700 - $750St. Anthony Apartments 14 - 2BR $925 - $1,000

520 2nd Avenue SE 1968 26 0 11 - 1BR $700 - $750520 2nd Avenue SE 0.0% 15 - 2BR $925 - $1,000St. Anthony Apartments

600 10th Avenue SE 1975 18 0 2 - Studio Primarily students600 10th Avenue SE 0.0% 4 - 1BRSteven Scott Management 12 - 2BR $945 - $955

624 4th Avenue SE 1961 17 0 17 - 1BR $600 - $665 --624 4th Avenue SE 0.0%Irving Properties

700 University Avenue SE 1958 32 1 32 - 1BR --700 University Avenue SE 3.1%Sela Investments



727 University Avenue SE 1956 28 1 28 - Studio --717 University Avenue SE 3.6%Sela Investments

Breton Apartments 1915 26 1 3 - 1BR Primarily students725 7th Street SE 3.8% 15 - 2BR $995 - $1,250 695 - 887Steven Scott Management 8 - 3BR $1,395 - $1,495

TABLE RM3 (continued)


1,000 Units feature hardwood floors. Heat, internet included.


AC in all units, dishwashers in some. Heat, water, trash, one surface parking stall included.

820600450

Building features laundry. Heat, water, gas, internet included. Parking $35/month.

$1,000 900550350


MARKET RATE GENERAL OCCUPANY RENTAL DEVELOPMENTS

$750$585


AC in all units, dishwashers in some. Heat, water, trash, one surface parking stall included.820

600

900

Units include AC. Building features storage, laundry. Heat included.

Units feature AC. Heat, water, parking included.

--

675450

$680 650 Units feature AC. Heat, water, trash, gas, storage, parking included.

Units feature AC. Heat, water, trash, gas, storage, parking included.

750$780

$825

1,025

572

Units feature AC. Heat, water, trash, gas, storage, parking included.

650$680

$630 500 Units feature AC. Heat, water, trash, gas, storage, parking included.

Units feature AC, hardwood floors. Building features laundry, storage. Heat included.




Year TotalProject Name/Addr./Mgmt. Built Units Vacant Resident Profile Description/CommentsChrisland Apartments 1966 50 0 11 - Studio $610 - $630815 13th Avenue SE 0.0% 30 - 1BR $695 - $715Chrisland Properties 9 - 2BR $985 - $1,015 759 - 805

Marcy Park Apartments 2002 59 0 11 - 1BR $899 - $949 666 - 683 Primarily students1015 8th Street SE 0.0% 21 - 2BR $1,349 - $1,650 874 - 1,105Lupe Development 21 - 3BR $1,750 - $1,950 1,007 - 1,224

6 - 4BR $2,350 - $2,450 1,267 - 1,366

Park Meadows Apartments 1961 14 0 2 - Studio --301 5th Street SE 0.0% 12 - 1BROlympus Properties

Stone Arch Apartments 2003 130 0 3 - Studio $1,056 - $1,087 536 - 643 Mix601/701 Main Street SE (221) 0.0% 47 - 1BR $1,170 - $1,220 661 - 992Pinnacle 80 - 2BR $1,485 - $1,713 848 - 1,014


277 - 2BR31 - 3BR

6 - 4BR

614 Huron Boulevard SE 1964 22 1 5 - Studio $640 - $650614 Huron Boulevard SE 4.5% 16 - 1BR $740 - $750Individual 1 - 3BR

Stadium Village Apartments 1959 121 1 34 - Studio $600 - $750 Primarily students1015 Essex Street SE 0.8% 66 - 1BR $625 - $825Classic City Apartments 21 - 2BR $1,000 - $1,200

Thornton Place Apartments 1972 81 5 26 - 1BR $795 - $900 Mix810 Thornton Street SE 6.2% 55 - 2BR $995 - $1,195Hornig Companies

Yale Place 1966 18 1 3 - Studio $525 - $575 Mix48 27th Avenue SE 5.6% 15 - 1BR $525 - $625Hornig Companies


76 - 2BR1 - 3BR

Rent Ranges Unit Size

Source: Maxfield Research Inc.Note: Average square footage calculated only for properties where unit square footage data was available.*Exact unit counts by type not available. Figures are estimates based on 49% of total units at Riverside Plaza being market rate; 49% of each unit type considered market rate.

Units features AC, dishwasher, disposal, some patios/balconies. Building features fitness center. All utilities included. Parking $50-$80/month.

$650

1,2501,095731550

$1,320$1,096$735$663

$2,400$1,700$1,202$760

518 Units features updated appliances, carpet, décor, some hardwood. Building features parking, bike racks. Rent includes heat, water,

Mix of undergraduate and graduate students, University staff


MARKET RATE GENERAL OCCUPANY RENTAL DEVELOPMENTSTABLE RM3 (continued)

Unit Mix

$689$595

Units include AC, dishwasher, disposal. Building includes floor laundry, bike storage, parking ($59-$79/mo). No utilities included.

541

700550

Units feature AC. Building features laundry, parking, storage. Heat, parking included.600

400

1,3171,085891641472

---- Units feature AC. Building features parking,

laundry, storage.

Some units recently renovated with air conditioning, hardwood floors, dishwashers.

------

1,095750 Units feature AC, dishwasher, disposal,

balconies. Building features pool, parking, laundry.

Prospect Park

Units feature AC, some hardwood floors. All utilities except electric included. 3BR unit rented by room for $440/mo.

Primarily graduate students

$1,320 1,250



Student-Oriented Properties Our research of the University District’s privately-owned, student-oriented rental properties surveyed 1,281 units in 13 properties in three neighborhoods. It includes all student-oriented apartments in the University District. Although many of the market rate properties described in the previous section target students and are occupied heavily by students, the properties in this section are distinct in that they are occupied exclusively by students. While they cannot legally exclude non-students, they effectively attract only students by marketing themselves as student housing, leasing only in the fall, advertising amenities such as study lounges, and frequently furnishing their apartments, leasing by the bedroom rather than the unit, and marketing units as being designed to have two people per bedroom. Table RM4 shows the privately-owned, student-oriented apartments in each neighborhood of the University District. The following are key points: • Student-oriented developments are almost exclusively located in Marcy-Holmes and Pros-

pect Park. Marcy-Holmes has five developments with 360 units and Prospect Park has six developments with 781 units. The only other development is GrandMarc at Seven Corners, which is located in Cedar-Riverside and has 140 units. All are located within five blocks of University of Minnesota facilities. There are no privately-owned, student-oriented develop-ments in Como.

• On average, the student-oriented developments are considerably more expensive than the

other market rate rental units. Studios average $716 per month versus $639 in the other de-velopments, one-bedrooms average $918 versus $763, two-bedrooms average $1,463 versus $1,093, three-bedrooms average $2,199 versus $1,500, and four-bedrooms average $2,920 versus $2,078. Average studio and one-bedroom units in the student-oriented developments are smaller than in general market rate rental developments, whereas their two-, three-, and four-bedroom units are larger, though often have shared bedrooms.

• Despite the comparatively high rents, student-oriented apartments had a very low vacancy

rate of 1.3%, with only one small development, Marshall Student Cooperative, having a va-cancy rate over 5.0%, indicating high demand for such housing. Student-oriented develop-ments command higher prices than other rental developments and remain successful because they tend to be newer, are some of the closest housing to the University of Minnesota cam-pus, offer more amenities, and may be cheaper on a per-student basis because of the ability to legally share bedrooms and have an apartment furnished free of charge.

• Of all the units, 742 (57.9%) were added since 2000 and 961 (75.0%) were added since 1990,

thus constituting the vast majority of housing units added in the University District in the last 20 years. As long as they continue to be lucrative for developers, student-oriented develop-ments are likely to remain the dominant development activity near the University of Minne-sota campus.



Year TotalProject Name/Addr./Mgmt. Built Units Vacant Capacity Description/Comments

GrandMarc at Seven Corners 2001 140 3 2 - Studio 11849 Washington Avenue S 2.1% 10 - 1BR 1College Park Commons 41 - 2BR 2 $779 - $829 $1,558 - $1,658

41 - 2BR+D 4 $489 - $539 $1,956 - $2,15646 - 4BR 4 1,252 - 1,358

Subtotal 140 32.1%

1301 University* 2005 92 0 16 - Studio 1 383 - 3861301 University Avenue SE 0.0% 35 - 1BR 1 $825 - $925 $825 - $925 393 - 572Brent Naylor 10 - 2BR 2 $750 - $800 $1,500 - $1,600 860 - 908

15 - 3BR 3 $700 - $725 $2,100 - $2,175 1,029 - 1,15016 - 4BR 4 $700 - $725 $2,800 - $2,900 1,290 - 1,330

Bierman Place Apartments 2000 68 0 9 - 2BR 21401 6th Street SE 0.0% 14 - 3BR 3Steven Scott Management 45 - 4BR 4 1,252 - 1,358

Chateau Student Housing Cooperative 1973 127 0 15 - Studio 1 $672 - $689 432 - 462425 13th Avenue SE 0.0% 34 - 1BR 1 $765 - $795 547 - 671Riverton Community Housing 48 - 2BR 2

18 - 3BR 312 - 4BR 4

Marcy Park Student Cooperative 1960 57 4 10 - Studio 1 $588 - $644 290 - 350700 10th Avenue SE & 1000 8th Street SE 7.0% 47 - 1BR 1 $706 - $795 450 - 630Riverton Community Housing

Marshall Student Cooperative 1968 16 1 4 - Studio 1 $600 - $6101405 5th Street SE 6.3% 11 - 1BR 1 $700 - $725Riverton Community Housing 1 - 2BR 2

Subtotal 360 51.4%

Argyle House 1997 85 0 16 - 1BR 1-2 $872 - $887920 Delaware Street SE 0.0% 39 - 2BR 2-4 $1,155 - $1,768 1,017 - 1,079Dinnaken Properties 18 - 3BR 3-5 $1,731 - $2,407 1,327 - 1,564

12 - 4BR 4-5 $2,308 - $2,801

-- Contined on next page. --

TABLE RM4


PRIVATELY-OWNED STUDENT-ORIENTED APARTMENTS

Prospect Park

$800$800 Units rented by bedroom. Units feature AC, full kitchen, washer, dryer, hardwood floors, spa bathroom. All utilities except electricity included.

900550350 Building features laundry. Heat, water, gas, internet

included. Parking $35/month. Must prove student status to lease.--

----

$1,000

Heat, water gas, electricity, cable, and internet included. Must prove student status to lease.

---- Heat, water, gas, electricity, cable, internet, parking

included. Must prove student status to lease.

----

1,100900

1,024$1,935

800

$1,481$1,166$1,010

$645$725

$2,396

------

$1,450

569450 Units rented by bedroom with some units furnished.

Units include AC, washer/dryer, full kitchen. Building includes gym, game room, study lounge. All utilities included. Parking $55/mo.

Marcy-Holmes

Como--- None ---

827 Rent charged by bedroom. Units feature microwave, dishwasher, stove, oven, and disposal. Building features fitness center, tanning bed, study lounge. Internet included.

$599

Units feature AC, dishwasher, disposal, refrigerator. Furnished. Building features laundry, study lounge, parking.

Cedar-Riverside

$735

$1,119$1,039

$2,940

$1,119$1,039

1,024827

1,753

699

--------

Unit Mix Per Student/Mo. Unit SizePer Unit/Mo.



Dinnaken House 1989 120 0 114 - 2BR 3-4 $1,155 - $1,768 841 - 970900 Washington Avenue SE 0.0% 6 - 3BR 4-5 $1,731 - $2,407Dinnaken Properties

Fulton Townhouse 1998 14 0 7 - 1BR 1-2 $872 - $887904-906 Fulton Street SE 0.0% 5 - 2BR 2-4 $1,155 - $1,768Dinnaken Properties 2 - 3BR 3-5 $1,731 - $2,407

Stadium View Apartments 2002 278 0 61 - 2BR 22508 Delaware Street SE 0.0% 31 - 3BR 3-4 $518 - $697 $2,072 - $2,091Place Properties 186 - 4BR 4

Tairrie House 1994 33 0 2 - Studio 1690 Oak Street SE 0.0% 6 - 1BR 1-2 $872 - $887Dinnaken Properties 18 - 2BR 2 $1,155 - $1,768 750 - 900

4 - 3BR 3 $1,731 - $2,407 1,025 - 1,2403 - 4BR 4 $2,308 - $2,801 1,280 - 1,725

University Commons 2003 164 7 20 - 1BR 1609 Huron Boulevard SE 4.3% 108 - 2BR 2-4 $509 - $739 $1,478 - $2,036 985 - 1,600Real Property Systems 36 - 4BR 4 $445 - $675 $1,780 - $2,700 1,111 - 1,205

University Village (West) 1999 87 3 6 - 1BR 1 $999 - $1,099 $999 - $1,099 670 - 7752515 University Avenue SE 3.4% 81 - 2BR 2-4 $479 - $749 $1,498 - $1,916 985 - 1,600Great Lakes Management

Subtotal 781 101.3%

Total/Average 1,281 18 49 - Studio -- --1.4% 181 - 1BR -- --

530 - 2BR -- --41 - 2BR+D -- --94 - 3BR -- --

311 - 4BR -- --


TABLE RM4 (continued)APARTMENT-STYLE STUDENT HOUSING

UNIVERSITY DISTRICTJuly 2010

1,058447410

*Unable to reach property. Information accurate as of January 2010.

$2,920$2,199$2,056$1,463$918$716

1,4421,2771,135

Units leased by bedroom. 20% of shared 2BR units reserved for independent students with income under 80% of area median (rent is $430 per room). Units features air conditioning, washer/dryer. Building features fitness center, community room, study room, tanning. All utilities included.

--------

Units feature AC, dishwasher, disposal, refrigerator, one garage space. Building features laundry.

$760

Units feature AC, dishwasher, disposal, refrigerator. Building features laundry, study lounges, underground parking. Targets graduate students.

501$1,150$1,150 Units rented by bedroom. Furnished, in-unit laundry, air conditioning. Building features gym, pool, game room. Utility allowance.

-- $698570450

Rent charged by bedroom. Units feature AC, dishwasher, disposal, refrigerator. Furnished. Building features community room, pool, tanning, fitness center. All utilities included.

------

------

$649

$760

$2,596 1,2271,035806

----

1,110Units feature AC, dishwasher, disposal, refrigerator. Furnished. Building features laundry, fitness center, parking.



Affordable Properties Affordable rental developments typically utilize Low-Income Housing Tax Credits to reduce rents slightly below the market rate. They are usually restricted to households earning no more than 50% to 60% of the area median income (AMI), and unlike subsidized developments where rent is 30% of a household’s monthly income, affordable developments have a set rent that does not fluctuate depending on a tenant’s income. Table RM5 below shows the affordable develop-ments in the University District. The following are key points from Table RM5: • Of the 356 affordable units in the University District, 265 (74.4%) are in Cedar-Riverside.

The remaining 91 units are in the Stone Arch Apartments in Marcy-Holmes. There are no affordable units in Como or Prospect Park.

• The two newest developments with affordable units also include market rate units. Seven

Corners Apartments includes 99 market rate units and Stone Arch Apartments include 130 market rate units. Today most market rate developments in Minneapolis that receive any form of public subsidy to finance construction or rehabilitation must include a portion of af-fordable units.

• Families and non-student individuals are the most common residents of affordable develop-

ments. Funding sources typically prohibit full-time students from occupying affordable units regardless of their income because of the assumption that they can derive support from stu-dent loans and family.

AMIName Neighborhood Year Built Address Max. Rent Limit UnitsBlue Goose Cooperative Cedar-Riverside 1900 1819 & 1825 5th St. S $1,090 60% 30Seven Corners Apartments1 Cedar-Riverside 1984 1400 2nd St. S $1,206 50%-60% 148Sherlock Homes Cooperative Cedar-Riverside Varies Various $1,090 60% 67Union Homes Cooperative Cedar-Riverside Varies Various $1,090 60% 11Watchcat Cooperative2 Cedar-Riverside Varies Various $1,090 60% 9Stone Arch Apartments3 Marcy-Holmes 2003 601 Main St. SE $1,134 50%-60% 91Total 356



AFFORDABLE GENERAL OCCUPANCY RENTAL DEVELOPMENTSTABLE RM5

2 Also includes eight subsidized units.3 Also includes 130 market rate units.

1 Also includes 99 market rate units.



Subsidized Properties Residents of subsidized properties pay 30% of their monthly incomes regardless of the total, and the government (city, state, or federal) pay the remainder. To qualify for living in a subsidized unit, residents must have very-low incomes that vary slightly by subsidy program. The most common subsidy programs for non-senior households in Minneapolis include the following:

Public Housing: Owned and operated by the Minneapolis Public Housing Authority (MPHA), these properties include traditional apartments and townhomes as well as scattered site single-family homes.

Project-Based Section 8: Privately owned and operated, these developments have

some or all of their units designated for the Section 8 program. Residents pay 30% of their monthly income as rent, and the MPHA pays the difference between a resident’s rent and the fair market rent (FMR) as determined by the United States Department of Housing and Urban Development.

Section 8 Housing Choice Voucher: Qualifying households may select any privately

owned and operated rental development that accepts Section 8 vouchers. The resi-dent pays 30% of their monthly income for rent and the MPHA pays the difference between the resident’s rent and the FMR.

Table RM6 below shows the income limits for Public Housing and Section 8 programs in Minneapolis.

Household Size Income Limit1 $29,4002 $33,6003 $37,8004 $42,0005 $45,4006 $48,7507 $52,1008 $55,450

TABLE RM6

INCOME LIMITS

Sources: HUD; Maxfield Research Inc.

2010MINNEAPOLIS

PUBLIC HOUSING & SECTION 8

Table RM7 on the next page shows subsidized housing developments in each neighborhood of the University District. The following are key points from the table:



• Of the 1,775 subsidized housing units in the University District, 1,303 (73.4%) are located in Cedar-Riverside. Prospect Park has 10.4% of the total stock, Marcy-Holmes has 9.6%, and Como has 6.6%.

• The majority (53.4%) of the subsidized units are Section 8, and an additional 41.1% of the

units are Public Housing. Numerous other government programs as well as charitable giving support the other subsidized housing units.

• Together, the Cedar High Apartments and Riverside Plaza constitute the largest concentra-

tion of subsidized housing in Minneapolis. Occupying a large complex in Cedar-Riverside, the Cedar High Apartments include 539 Public Housing units while Riverside Plaza includes 669 Project Based Section 8 units and 634 market rate units, a portion of which have tenants with Section 8 Housing Choice Vouchers.

• The only scattered Public Housing units in the University District are seven units in Como. • Subsidized housing developments are almost always full with long waiting lists. The MPHA

opened its family housing waitlist in July and received over 8,000 applications for 917 hous-ing units citywide that average turnover of only about 120 units per year.



Name Yr. Built Address Group(s) Served Funding No. of Units

Cedar High Apartments 1970 Various on 6th St. S., Cedar Ave. Family, Individual Public Housing 539Riverbluff 1983 2020 1st St. S Family, Individual Section 8, Other 30Riverside Plaza 1973 1600 6th St. S Family, Individual Section 8 669West Bank Homes Cooperative 1957 2613 6th St. S Family, Individual Section 8 65Subtotal 1,303

Scattered Site Public Housing Varies Various Family Public Housing 7Talmage Green 1981 Various Family Section 8 26Van Cleve Commons 2008/2009 Brook Ave. SE & 12th Ave. SE Family, Homeless Various 85Subtotal 118

Cabrini House 1930 1025 6th St. SE Near Homeless/Homeless Other 13Holmes Greenway Housing 1983 114 5th St. SE Disabled Section 8, Other 50Holmes Park 1979 320 2nd Ave. SE Family Section 8 107Subtotal 170

Glendale Townhomes -- Various Family Public Housing 184Subtotal 184

Total 1,775



AFFORDABLE AND SUBSIDIZED GENERAL OCCUPANCY HOUSINGTABLE RM7

Cedar-Riverside

Como

Marcy-Holmes

Prospect Park

SENIOR HOUSING ANALYSIS


Senior Housing Defined The term “senior housing” refers to any housing development that is restricted to people age 55 or older. Today, senior housing includes an entire spectrum of housing alternatives, which occasionally overlap, thus making the differences somewhat ambiguous. However, the level of support services offered best distinguishes them. Maxfield Research Inc. classifies senior housing properties into four categories based on the level of support services offered: Adult/Few Services; where few, if any, support services are provided and rents tend to be modest as a result; Congregate; optional services where support services such as meals and light housekeeping are available for an additional fee or service-intensive where support services such as meals and light housekeeping are included in the monthly rents; Assisted Living; where two or three daily meals as well as basic support services such as trans-portation, housekeeping and/or linen changes are included in the fees. Personal care services such as assistance with bathing, grooming and dressing is included in the fees or is available either for an additional fee or included in the rents. Memory Care; where more rigorous and service-intensive personal care is required for people with dementia and Alzheimer’s disease. Typically, support services and meal plans are similar to those found at assisted living facilities, but the heightened levels of personalized care demand more staffing and higher rental fees. These four senior housing products tend to share several characteristics. First, they usually offer individual living apartments with living areas, bathrooms, and kitchens or kitchenettes. Second, they generally have an emergency response system with pull-cords or pendants to promote security. Third, they often have a community room and other common space to encourage socialization. Finally, they are age-restricted and offer conveniences desired by seniors, al-though assisted living developments sometimes serve non-elderly people with special health considerations. The four senior housing products offered today form a continuum of care from a low level to a fairly intensive one; often the service offerings at one type overlap with those at another. In general, however, adult/few services developments tend to attract younger, more independent seniors, while assisted living and memory care developments tend to attract older, frailer seniors.



Fully Independent

Senior Housing ProductsSource: Maxfield Research Inc.

CONTINUUM OF HOUSING AND SERVICES FOR SENIORS

Single-Family Home

Townhome or Apartment

Congregate Apartments w/ Optional Services Assisted Living Nursing

Facilities

Lifestyle Dependent on Care

Age-Restricted Independent Apartments, Townhomes, Condominiums, or

Cooperatives

Congregate Apartments w/ Intensive Services

Memory Care Units

Fully or Highly

Market Rate Senior Housing in the University District There is no existing market rate senior housing in the University District, nor is there any pend-ing market rate senior housing. As explained in the Rental Market Analysis and For-Sale Market Analysis sections, recent housing development in the area has been predominantly general occupancy rental and condominium. Many of the rental properties either attract primarily students or are specifically targeted at only students. However, according to sales agents at the condominium developments, the developments along the Mississippi River in Marcy-Holmes have been popular with older adults (ages 55 to 64) and younger seniors (ages 65 to 74). Market Rate Senior Housing in Other Minneapolis Neighborhoods A senior in the University District desiring market rate senior housing senior housing would have to seek housing in other Minneapolis neighborhoods or outside of Minneapolis. Table S1 on the next page shows each of the market rate developments in other Minneapolis neighborhoods. The following are key points from Table S1: • As of July 2010, there were 671 units of condominium or cooperative, 172 units of indepen-

dent rental, 836 units of congregate, 177 units of assisted living, and 22 units of memory care senior housing.

• All of the condominium and cooperative housing was built between 1984 and 1986. Becket-

wood Cooperative, Nokomis Square Cooperative, and Standish Green are located in South Minneapolis, while Kenwood Isles is located in Southwest Minneapolis and Bremer Way Condominiums is located in North Minneapolis. Bremer Way Condominiums is the closest development to the University District.

• The independent rental stock includes one building constructed in 1977 and two constructed

in the early 2000s. Booth Manor is located near Downtown, Monroe Village is in Northeast Minneapolis, and Shingle Creek Commons is in North Minneapolis. Both Monroe Village



and Booth Manor are in close proximity to the University District, especially Cedar-Riverside. Monroe Village also includes 10 affordable units.

Name Neighborhood Year Opened Units

Becketwood Cooperative Hiawatha 1986 210Bremer Way Condominiums Hawthorne 1985 77Kenwood Isles East Isles 1985 132Nokomis Square Cooperative Ericsson 1984 207Standish Green Standish 1986 45Total 671

Booth Manor* Loring Park 1977 57Monroe Village* Logan Park 2004 40Shingle Creek Commons Lind - Bohanon 2002 75Total 172

Augustana Apartments Elliot Park 1978-1988 377Ebenezer Tower* Phillips West 1973 101The Kenwood Lowry Hill 1987 123Walker Place East Harriet 1985 135Treetops at Calhoun CARAG 1988 100Total 836

Bethany Covenant Home Windom Park 1975 16Jones Harrison Residence Cedar - Isles - Dean 1992 55The Kenwood Lowry Hill 1987 30Main Street Lodge St. Anthony West 1994 50River Village East* Marshall Terrace 2004 26Total 177

River Village East Marshall Terrace 2004 22Total 22


Condominium/Cooperative

July 2010

MARKET RATE SENIOR HOUSINGMINNEAPOLIS

*Also includes affordable or subsidized units.

TABLE S1

Memory Care

Assisted Living

Congregate

Independent Rental

• All of the congregate units were built between 1973 and 1988. Augustana Apartments, the

largest development, is located in the Downtown district in a neighborhood adjacent to Ce-dar-Riverside. An additional 358 units in The Kenwood, Walker Place, and Treetops at Cal-houn are located in Southwest Minneapolis, and Ebenezer Tower, with 101 units is in South Minneapolis close to Downtown.



• The first market rate assisted living facility in Minneapolis, Bethany Covenant Home, was built in 1975. The Kenwood was built in 1987, two facilities were built in the 1990s, and River Village East was built in 2004. Main Street Lodge, located in Northeast Minneapolis, is the closest facility to the University District. Bethany Covenant Home and River Village East are also in Northeast Minneapolis, but are not as accessible to the University District. Jones Harrison Residence and The Kenwood are in Southwest Minneapolis.

• The only memory care facility in Minneapolis is at River Village East. Opened in 2004, the

facility has 22 units and is located in Northeastern Minneapolis close to the border with Co-lumbia Heights.

Affordable and Subsidized Senior Housing Many housing programs for low-income seniors are very similar to their counterparts for fami-lies and younger individuals. At affordable developments, seniors earning 50% to 60% of the area median income (AMI) pay a monthly rent slightly reduced from the market rate, while at subsidized developments, seniors with incomes below 50% of the AMI pay just 30% of their monthly income for rent. The following are the main affordable and subsidized senior housing programs:

Section 42 Low-Income Housing Tax Credits: A developer sells tax credits granted by HUD to investors when building or rehabilitating a development. The revenue is then used to reduce rent for tenants. They are typically used for affordable housing, but can also be used in conjunction with other programs for subsidized housing.

Public Housing: The Minneapolis Public Housing Authority (MPHA) owns and oper-

ates buildings restricted to any income-qualified person age 50 and over as well as in-come-qualified people age 18 and over with disabilities. Tenants pay 30% of their monthly income for rent.

Project-Based Section 8: Privately owned and operated, these developments have some or all of their units designated for the Section 8 program, and all of their units are re-stricted to people age 62 and older. Residents pay 30% of their monthly income as rent, and the MPHA pays the difference between a resident’s rent and the fair market rent (FMR) as determined by the United States Department of Housing and Urban Develop-ment.

Section 202: Privately owned and operated, these developments have some or all of

their units designated for the Section 202 program and provide supportive services to their residents, who must be age 62 or over. Residents pay 30% of their income and HUD pays the difference between their contributions and the units’ operating costs.

Elderly Waiver: Administered by the Minnesota Department of Human Services, Elder-

ly Waivers provide financial support for low-income seniors who would otherwise need skilled nursing care to remain in their communities. Elderly Waivers pay for home



health care, assisted living, or memory care up to the estimated cost of skilled nursing for each recipient. Many market rate assisted living and memory care facilities accept El-derly Waivers.

Senior Section 8 and Section 202 income limits are the same as general Section 8 income limits presented in the Rental Market Analysis section. For senior Public Housing, annual income for a one-person household cannot exceed $40,600 and for a two-person household cannot exceed $46,400. Senior Public Housing does not accommodate larger households. There are no affordable senior housing developments in the University District and just two in Minneapolis. St. Anne’s Senior Community, located at 2323 26th Avenue North in the Jordan neighborhood of North Minneapolis, opened in 2007 with 55 units of affordable independent rental housing. The maximum rent is $750 per month. The project also includes four subsidized units. Monroe Village, located at 1900 Central Avenue Northeast in the Logan Park neighbor-hood of Northeast Minneapolis, opened in 2004 with 40 market rate units and 10 affordable units Table S2 below shows subsidized senior housing developments in the University District and Minneapolis as a whole. The following are key points from Table S2: • There is one subsidized senior housing development in the University District. Labor

Retreat is a 77-unit Section 8 building located at 124 4th Avenue Southeast in Marcy-Holmes. • Of the 2,464 subsidized senior housing units in Minneapolis, 82.8% are independent rental,

9.5% are congregate, and 7.7% are assisted living. There are no subsidized memory care units in Minneapolis.

• The MPHA operates 1,681 senior housing units. All are located in independent rental

buildings, but in four of these buildings, outside organizations provide assisted living servic-es to residents who need them. Volunteers of America provides services in Charles Horn Towers (22 clients), Lyndale Manor (27 clients), and Parker Skyview (35 clients), while Au-gustana Community Partners provides services in Heritage Commons at Ponds End (42 clients). Residents receiving assisted living services in these facilities remain in their apart-ment units.

• There are just two congregate facilities in Minneapolis. River Village North is located in

Northeast Minneapolis and Ebenezer Park Apartments is located in South Minneapolis near Downtown. In addition to these facilities, residents in most of the independent rental devel-opments would be able to contract in-home assistance from outside services.

• Of the six developments where assisted living services are available, two are specifically

designated as assisted living. River Village East has 22 Section 8 units, while Signe Burk-hardt Manor is the only Public Housing assisted living facility. As explained above, all other Public Housing assisted living services are provided in independent rental buildings by out-side organizations.



Year No. ofName Neighborhood Opened Funding Units

Booth Manor Loring Park 1977 Section 8 100Calhoun Beach Club Apartments East Harriet 1978 Section 8 16Charles Horn Towers1 Lyndale -- Public Housing 306Hamilton Manor Webber-Camden 1972 Public Housing 220Heritage Commons at Ponds End2 Sumner-Glenwood 2003 Public Housing 60Holland Highrise North Loop 1970 Public Housing 182Labor Retreat Marcy-Holmes 1977 Section 8 77Loring 100 Apartments Loring Park 1983 Section 8 107Lyndale Manor1 Near-North 1969 Public Housing 212Parker Skyview1 Windom Park -- Public Housing 298Rainbow Highrise Willard-Hay 1900 Public Housing 84Saint Anne's Senior Community3 Jordan 2007 Section 42, Other 4St. Paul's Home Phillips East 1974 Section 8 53The Riverside Seward 1967 Public Housing 151Trinity Apartments Longfellow 1978 Section 8 120Walker on Lyndale Windom Park 2005 Section 8 49Total 2,039

Ebenezer Park Apartments Phillips West 1980 Section 202 200River Village North Marshall Terrace 2004 Section 202 35Total 235

River Village East Marshall Terrace 2004 Section 8 22Signe Burkhardt Manor Whittier 1992 Public Housing 42Charles Horn Towers1 Lyndale -- Public Housing 22Heritage Commons at Ponds End2 Sumner-Glenwood 2003 Public Housing 42Lyndale Manor1 Near-North 1969 Public Housing 27Parker Skyview1 Windom Park -- Public Housing 35Total 190


MINNEAPOLISSUBSIDIZED SENIOR HOUSING

TABLE S2

3 Also includes 55 affordable units.

2 Assisted living services provided by Augustana Community Partners. Number varies by need.

1 Assisted living services provided by Volunteers of America. Number varies by need.

-- None --

Independent Rental

Congregate

Assisted Living

Memory Care

July 2010



Senior Housing Near Comparable University Campuses Because the University District has so far attracted very little senior development, its senior residents who are unable or longer willing to stay in their homes must leave the neighborhoods where they may have lived for decades. Analyzing the neighborhoods near other major, urban research universities is a useful way to better understand the challenges faced by the University District as well as to discover successful models for bringing senior housing to neighborhoods where student renter household drive development. Maxfield Research identified the most important characteristics of the University of Minnesota and the Twin Cities Metropolitan Area for driving the housing market near the campus and reviewed major universities in the United States relative to these characteristics. The characteris-tics include the University of Minnesota’s large student body, status as a research university, and location near a downtown in a medium-sized metropolitan area. Based on these factors, we selected the University of Washington at Seattle, the University of Texas at Austin, and the University of North Carolina at Chapel Hill. For each university, we analyzed the neighbor-hoods within a 1.5 mile radius of the university. University Summaries Table S3 below shows a summary of population and household growth trends in the three metropolitan areas where the universities are located, and Table S4 on the next page provides a summary of the student body and student place of residence for each of the three universities. A brief description of each University based on Table S4 follows.

Metropolitan Area 2000 2010 2015 2000-2010 2010-2015Minneapolis - St. Paul 2,642,056 2,891,861 2,979,173 9.5% 3.0%Seattle - Tacoma - Bellevue 3,043,878 3,461,985 3,672,452 13.7% 6.1%Austin - Round Rock - San Marcos 1,249,763 1,765,393 2,086,147 41.3% 18.2%Raleigh - Durham - Chapel Hill 1,223,564 1,667,221 1,937,071 36.3% 16.2%

2000 2010 2015 2000-2010 2010-2015Minneapolis - St. Paul 1,021,454 1,132,189 1,169,802 10.8% 3.3%Seattle - Tacoma - Bellevue 1,196,568 1,369,762 1,456,468 14.5% 6.3%Austin - Round Rock - San Marcos 471,855 656,710 775,332 39.2% 18.1%Raleigh - Durham - Chapel Hill 475,182 649,029 755,020 36.6% 16.3%

2000-2015COMPARABLE UNIVERSITY NEIGHBORHOOD ANALYSIS

TABLE S3


Population

Households

Percent Change

Percent Change

SUMMARY OF METROPOLITAN AREAS



No. Pct. No. Pct. No. Pct.StudentsTotal 42,697 100.0 50,995 100.0 28,916 100.0

Undergraduate 27,785 65.1 38,168 74.8 17,981 62.2Graduate/Professional 14,912 34.9 12,827 25.2 10,935 37.8

Place of ResidenceDormitories 5,694 13.3 6,979 13.7 7,463 25.8Campus Apartments 1,255 2.9 712 1.4 875 3.0Off-Campus 35,748 83.7 43,304 84.9 20,578 71.2

Univ. of Washington Univ. of Texas Univ. of N. Carolina

Source: U. of Washington; U. of Texas; U. of North Carolina; Maxfield Research Inc.

Fall 2009STUDENTS AND PLACE OF RESIDENCE

COMPARABLE UNIVERSITY NEIGHBORHOODSTABLE S4

• University of Washington: The University of Washington is located approximately two

miles north of Downtown Seattle in a dense, urban neighborhood similar to the area around the University of Minnesota. With 42,697 students at the beginning of the 2009-2010 school year, it was the second largest of the three universities being analyzed, and it also had the second largest undergraduate population. Of all the students, 83.7% lived off campus, with many likely in the surrounding neighborhoods. Overall, its metropolitan area is the largest of the three studied as well as larger than the Twin Cities Metropolitan Area.

• University of Texas: The University of Texas is located immediately north of Downtown

Austin, with Downtown bordering the University to the south and residential areas bordering it to the other three directions. With 50,995 students, it is the largest of the three universities, and has the largest undergraduate student population of the three universities. Of all the stu-dents, 84.9% live off campus. The University’s metropolitan area is fastest growing of the three studied.

• University of North Carolina: The University of North Carolina is the smallest of the three

universities, with 28,916 students. Nevertheless, it is an expanding research institution lo-cated in a residential part of a growing metropolitan area. The University is located adjacent to Downtown Chapel Hill, about 10 miles from Downtown Durham, and about 30 miles from Downtown Raleigh. Although it has a similar mix of undergraduate and gradu-ate/professional students, it has the lowest percentage of students living off campus (71.2%).

Senior Housing Near the Universities Table S5 below shows the senior housing developments within 1.5 miles of each of the three universities. The following summarizes key points from Table S5: • The University of Washington has the largest stock of senior housing within 1.5 miles of its

campus. The area’s senior housing stock includes 112 units of senior Public Housing and 514 units of private pay housing with services. The University of Texas has 196 units of se-



nior Public Housing within 1.5 miles of its campus. The University of North Carolina has the smallest senior housing stock near its campus, with just 64 units at one assisted living and memory care facility.

University NumberName Service Level Affiliation Payment of Units

Blakely Manor Independent Rental No Public Housing 70Ida Culver House Congregate, AL Yes Private 245Merrill Gardens at the University Congregate, AL No Private 123University House of Wallingford Congregate, AL Yes Private 146Willis House Independent Rental No Public Housing 42Total 626

Lakeside Apartments Independent Rental No Public Housing 164Salina Apartments Independent Rental No Public Housing 32Total 196

Carolina House of Chapel Hill AL, MC No Private 64Total 64

1.5 MILE RADIUS FROM UNIVERSITYSENIOR HOUSING NEAR COMPARABLE UNIVERSITIES

TABLE S5


University of North Carolina

University of Texas

University of Washington

July 2010

• University House of Wallingford resulted from a partnership between ERA Living, a Seattle Area senior housing provider, and the University of Washington Retirement Association (UWRA), a retirement association for retired University Faculty and Staff. The facility opened in 1997 and offers all residents access to all UWRA benefits, which include presenta-tions and activities. It is open to the general public, but UWRA members get priority access to the facility.

• Both University House of Wallingford and Ida Culver House, also operated by ERA Living,

have affiliations with the University of Washington School of Nursing and School of Social Work to provide training to students of those schools and services to residents of the facili-ties. They are the only senior housing facilities near any of three universities with a formal relationship with the nearby university.

• There are two Public Housing developments each near the University of Washington and the

University of Texas. Public Housing buildings were typically built in the 1960s or 1970s when both universities were smaller and development pressure did not make the land around them as valuable as it is today. As mentioned before, Public Housing and Section 8 housing comprise the only senior housing in the University District of the University of Minnesota.



University of Washington Table S6 below provides demographic information about the area within 1.5 miles of the Univer-sity of Washington. The following are important points from the table: • While students are prevalent, the neighborhood is more diverse than the University District.

Although Dorms to Diplomas is the most prevalent consumer profile, only 25.5% of house-holds are in the category. Urban Chic and Trendsetters, which are not common in the Uni-versity District, both describe educated, fashionable professionals. Additionally, households over the age of 55 are estimated to comprise 17.0% of the population as of 2010.

• Housing is considerably more expensive than in the University District, with a median value

of $585,902 in 2010. Additionally, 39.7% is owner-occupied, making the neighborhood much less renter-dominated than the University District.

• Because of the higher demand from seniors and different housing dynamics near the Univer-

sity of Washington, the market more easily attracts development of senior housing. The ac-tive UWRA also played a major role in one development, and may present a model for how the University District could promote senior housing development.

Census Estimate Projection2000 2010 2015 2000-2010 2010-2015

Population 50,296 54,002 55,960 7.4% 3.6%Pct. 18-34 53.3% 47.7% 47.9% -3.9% 4.2%Pct. 55+ 13.0% 17.0% 18.3% 40.1% 11.9%

Households 20,129 21,667 22,676 7.6% 4.7%Pct. Family 38.6% -- -- -- --Pct. Non-Family 61.4% -- -- -- --Median Income $47,747 $63,354 $80,605 32.7% 27.2%

Housing Units 20,919 23,054 24,106 10.2% 4.6%Pct. Owner-Occupied 41.6% 39.7% 39.0% -- --Pct. Renter-Occupied 54.6% 54.3% 55.0% -- --Pct. Vacant 3.8% 6.0% 5.9% -- --Median Value $359,613 $585,902 $724,143 62.9% 23.6%Pct. Single-Family 3.8% -- -- -- --

Top Consumer ProfilesDorms to Diplomas -- 25.5% -- -- --Urban Chic -- 22.3% -- -- --Laptops and Lattes -- 15.5% -- -- --Metro Renters -- 12.4% -- -- --Trendsetters -- 7.4% -- -- --

TABLE S6


Percent Change

SEATTLEUNIVERSITY OF WASHINGTON

NEIGHBORHOOD SUMMARY - 1.5 MILE RADIUS



University of Texas Table S7 below provides demographic information about the area within 1.5 miles of the Univer-sity of Texas. The following are important points from the table: • The neighborhood around the University of Texas closely resembles the University District

demographically. The 18-34 population forms a large majority (68.0%), while older adults and seniors comprise a relatively small portion (9.4%). Dorms to Diplomas and College Towns comprise almost 50.0% of households, with Metro Renters and Laptops and Lattes also being well-represented. Simple Living is the only profile not represented in the Univer-sity District. It describes middle-age and older adults with lower incomes.

• The housing stock is similar to that of the University District, with only 21.4% estimated to

be owner-occupied and a median value of $192,744. Because of limited development oppor-tunity, the dominance of students in the area, and a lack of initiatives such as that of the UWRA, promoting senior housing development in the area is difficult.


Population 45,286 51,541 55,891 13.8% 8.4%Pct. 18-34 68.3% 68.0% 67.3% 13.3% 7.3%Pct. 55+ 7.8% 9.4% 10.5% 36.8% 21.3%

Households 18,111 21,212 23,645 17.1% 11.5%Pct. Family 24.7% -- -- -- --Pct. Non-Family 75.3% -- -- -- --Median Income $22,125 $28,104 $33,743 27.0% 20.1%

Housing Units 19,033 23,234 26,097 22.1% 12.3%Pct. Owner-Occupied 23.5% 21.4% 21.2% -- --Pct. Renter-Occupied 71.6% 69.9% 69.4% -- --Pct. Vacant 4.8% 8.7% 9.4% -- --Median Value $140,737 $192,744 $216,023 37.0% 12.1%Pct. Single-Family 30.0% -- -- -- --

Top Consumer ProfilesDorms to Diplomas -- 39.3% -- -- --Metro Renters -- 28.9% -- -- --College Towns -- 8.0% -- -- --Simple Living -- 6.4% -- -- --Laptops and Lattes -- 4.8% -- -- --

TABLE S7


Percent Change

AUSTINUNIVERSITY OF TEXAS




University of North Carolina Table S8 below provides demographic information about the area within 1.5 miles of the Univer-sity of North Carolina. The following are important points from the table: • Demographically, the area closely resembles the University District and the neighborhood

around the University of Texas. College Towns and Dorms to Diplomas comprise over 50.0% of households, and the population age 18 to 34 comprises 64.0% of the total. At 11.5% of the total population, seniors comprise a slightly larger portion, but students and young professionals still dominate the area, as indicated by the consumer profiles. Enterpris-ing Professionals, the only consumer profile not present in any of the other neighborhoods, describes relatively high-income, young, working people.

• Just 31.4% of housing units are owner-occupied in the neighborhood, but the area is less

dense than the University District or either of the other two universities. Senior housing thus does not compete with other land uses to the same extent, so some recent development has occurred.


Population 25,744 25,623 26,564 -0.5% 3.7%Pct. 18-34 71.1% 64.0% 63.1% -10.5% 2.2%Pct. 55+ 8.4% 11.5% 12.7% 35.0% 14.7%

Households 8,118 7,306 7,753 -10.0% 6.1%Pct. Family 33.6% -- -- -- --Pct. Non-Family 66.4% -- -- -- --Median Income $23,954 $36,888 $50,025 54.0% 35.6%

Housing Units 8,611 8,025 8,580 -6.8% 6.9%Pct. Owner-Occupied 27.3% 31.4% 31.0% -- --Pct. Renter-Occupied 67.0% 59.7% 59.4% -- --Pct. Vacant 5.7% 9.0% 9.6% -- --Median Value $225,174 $288,588 $352,784 28.2% 22.2%Pct. Single-Family 34.3% -- -- -- --

Top Consumer ProfilesCollege Towns -- 34.0% -- -- --Laptops and Lattes -- 19.1% -- -- --Dorms to Diplomas -- 17.9% -- -- --Enterprising Professionals -- 10.5% -- -- --Metro Renters -- 6.3% -- -- --

TABLE S8


Percent Change

CHAPEL HILLUNIVERSITY OF NORTH CAROLINA


PLANNED AND PENDING SUMMARY


Planned/Proposed Summary Maxfield Research Inc. interviewed city officials, local neighborhood staff, and develop-ers/builders of residential housing to determine planned or pending housing developments in the University District. Although a number of developers routinely approach the City and neighbor-hoods, the following list includes those projects that have been formally submitted or likely to move forward. Table P1 on the following page summarizes development projects by neighbor-hood. Cedar Riverside • Bob Lux of Alatus Management received preliminary approval in November 2008 for a

mixed-used project on the location of the former Grandma’s Saloon & Grill (1810 Washing-ton Avenue South) next to the Seven Corners Parking Ramp near the University of Minneso-ta’s West Bank Campus. The project is planned to include 369 units in a 25-story complex with a target market of students; according to the developer, approximately 75% to 80% of the units are projected to be occupied by students. Although groundbreaking was planned for 2009 with a completion date of the start of the 2010-2011 school year, the project has been delayed due to financing issues and it is unclear when or if it will move forward. At this time it is unknown if or when the project will move forward.

• Fine Associates purchased a large parcel behind Riverside Plaza with the intention of

building over 300 multifamily units. In 2006 the developer proposed Phase I of Currie Park Lofts, a 168-unit, five-story rental building with 42 market-rate units and 126 units afforda-ble to households earning between 50% and 60% of the area median income. The project became embroiled in a lawsuit over access and easement rights, and by the time it was set-tled, the project could no longer attract the necessary financing due to the weak economy. According to the City, the developer still plans to move forward with the project when the economy improves. The most recent proposal is for about 250 to 300 workforce housing units.

Como • There are two small tentative projects in the Como neighborhood. The first is a mixed-use

development located at Como Avenue and 18th Avenue that would consist of first-floor commercial space with rental housing above. The second is a three-unit rental townhome project at Como Avenue and 22nd Street that would consist of four- and five-bedroom units. Consequently, at this time both projects are on-hold.

• Project for Pride in Living (“PPL”) has confirmed a purchase agreement has been signed

between PPL and Doran Companies for the Bunge Grain Elevator site located adjacent to the Burlington Northern-Santa Fe railroad tracks between SE 12th and SE 13th Avenues. Al-though no formal plan has been submitted at this time, it is likely the development will in-clude general-occupancy rental housing targeting students.



Project Name/ General Project Number ofDeveloper Location Type Units Status/Notes

Cedar-Riverside

Former Grandma's Site 1810 Wash. Ave. S. General-Occupancy Rental - 369 On-HoldAlatus Management Student Oriented

Riverside Plaza adjacent parcel Behind Riverside Plaza Affordable/work-force Hsg. 250+ On-HoldFine Associates

Marcy-Holmes

412 Lofts 12th Ave. & 5th St. General-Occupancy Rental - 102Doran Companies Student Oriented

TBD 4th St. & 8th Ave. General-Occupancy Rental - 12 Under Construction, demo workMaster Development Student Oriented completed

Former Church Site 4th St. SE & 8th Ave. SE. Affordable/low-income 39 On-HoldTBD - formerly CommonBond senior and disabled housing

Mill District Apartments Flour Sacks Flats Phase II site General-Occupancy 96 On-HoldLupe Development/Wall Co. 518-520 2nd St. SE Affordable at 50% AMI

Florence Court Apartments 1022 University Ave. SE General-Occupancy 37Clark Gassen

FloCo Fusion 1022 University Ave. SE General-Occupancy 84Clark Gassen

East Bank Mills Along East Bank of Multiple multifamily housing 1,000+BNC Bank Mississippi River concepts

Prospect Park

Stadium Village Flats 810, 814, & 818 General-Occupancy 120Opus Washington Ave. Student Oriented

Solhem East Bank Delaware St. & Huron Blvd. General-Occupancy 75Curt Gunsbury Student Oriented

Oak St. Rental 309 & 313 Oak St. General-Occupancy 65Doran Companies Student Oriented

Prospect Place 3028 Univesity Ave. Mixed-use with rental hsg. 18TBD

Como

TBD Como & 18th St. Mixed-use development with 2Gregg Jansma rental units

TBD Como & 22nd St. Rental Townhomes 3Vaight Construction

Bunge Grain Elevator Site SE 12th Avenue General-Occupancy TBDDoran Companies Likely student oriented

Pending/Planned SummaryUnder Construction 235Planned -expected to move forward in short-term 265On-Hold or Stalled 1,754


TABLE P1PLANNED AND PROPOSED HOUSING PROJECTS

UNIVERSITY DISTRICT

Under Construction - occupancy expected late summer 2011. 2nd phase in 2014

Rehab - Under Construction

January 2011

On-Hold. No plans submitted to City.

On-Hold

Three lots combined for redevelopment. Long John Silvers & A&W proposed on 1st floor.

Has not yet received City approvals. Expect summer 2012 occupancy

New Construction, expected occupancy in late Summer 2011

Stalled - currently under foreclosure. Original developer Schaefer Richardson may still develop

Expected occupancy August 2012. Mixed-use with 1st-level retail

Expected occupancy Fall 2011

Developer has purchase agreement with PPL to purchase the site



Marcy-Holmes • Doran Companies is currently constructing 102 rental units located on the former Heart of

the Earth School at 12th Avenue and 5th Street (to be named 412 Lofts). The development will consist of two phases on a site consisting of three separate parcels. The first phase in-cludes a five-story general-occupancy rental building consisting of 12 studios, 11 one-bedrooms, 69 two-bedrooms, and 10 three-bedroom units. The building has 102 under-ground parking stalls, on-site management, security staff, community room, and fitness room. According to the developer, occupancy is expected in late summer 2011.

The second phase includes the renovation of the existing Frey Mansion into a communi-ty/cultural center preserving the Native American culture. The 2nd phase is anticipated to commence construction in 2012 with delivery for 2014.

• CommonBond Communities received approval in June 2008 for Andrew Riverside Senior

Housing, a 39-unit rental building for low-income seniors on the former site of a church at 4th Street SE and 8th Avenue SE. In October 2008 the project was granted Low-Income Housing Tax Credits and in December it received a grant from the City of Minneapolis. However, the project was also relying on bond financing, for which the market collapsed in late 2008, mak-ing it impossible to move forward. The scope of the project was revised to include half of the units for people of any age with physical disabilities and the other half to be for low-income seniors. Although the project will still likely move forward with this concept, it is unlikely CommonBond will be the developer.

• BKV Group (on behalf of Lupe Development and the Wall Companies) received approval in

May 2010 from the Planning Commission to move forward with a seven-story, 91-unit rental development at 518-520 2nd Street SE. To be named the Mill District Apartments, the project is a revision of a plan for a 96-unit building that received approval in 2007 but never went forward and has since had its approvals expire. To receive final approval and begin construc-tion, the Heritage Preservation Commission must approve the plans. Additionally, because the development sought a density bonus, 20% of its units (19 units) must be affordable to households earning 50% or less of the area median income. Although this project is expected to move forward, timing is unknown.

• Developer Clark Gassen renovated the 37-unit historic Florence Court Apartments at 1022

University Avenue Southeast. The project originally emerged from a plan to develop an 84-unit, six story apartment building on an adjacent parcel. Neighborhood opposition ultimately led to a compromise in which the developer would first renovate the old Florence Court Apartments. The project includes 33 units in studio, one-, two-, three-, and four-bedroom layouts. The building’s target market is a mixture of professionals and students.

The 84-unit FloCo Fusion component is located on the site of a former gas station and five single-family homes adjacent to Florence Court Apartments. Due to neighborhood concerns, the developer agreed to preserve four of the five single-family homes. The project is under construction and expected occupancy is late summer 2011. The unit mix will include five one-bedroom, 33 two-bedroom, 25 three-bedroom, and 21 four-bedroom units.



• Shafer Richardson has been planning for the development of East Bank Mills, an eight-acre site located on the east bank of the Mississippi River along the historic Main Street just east of St. Anthony Main. The mixed-use project would redevelop the existing Pillsbury A Mill (among other historic structures) while also constructing six new buildings. Original devel-opment plans included a mix of condominiums, apartments, and retail and office space. It was originally estimated to include up to 1,000 residential housing units. However, due to the current recession and depressed housing market, the project has been temporarily stalled and has been foreclosed upon. The current title holder is BNC Bank; however Shafer Rich-ardson is attempting to work with BNC Bank on developing the property. The following de-scribes the various buildings originally planned to be developed:

Pillsbury A Mill – Previously planned for residential, now planned as commercial space. The Cooper and Archer –Condominium development (long-term) Warehouse 2 – Originally planned for condominiums, revised to commercial space. South Mill – Planned as 50 market rate apartments Red Tile – Condominium development (long-term)

Prospect Park • Opus Northwest received preliminary approval in October 2008 for development of a

mixed-used project at 810, 814 & 818 Washington Avenue. Originally to be named Campus Crossroads, the project was first planned to include 175 units in an eight-story mixed-use development with first-level retail. However, the project has been renamed Stadium Village Flats and is now planed for 120 rental units in a six-story building with first-level retail (ten-tatively a CVS Pharmacy).

• Doran Companies is planning to develop a six-story rental housing project adjacent to the

Opus project at 309 and 313 Oak Street. The project would be similar to the 125-unit re-cently completed Sidney Hall. Although the project has not yet received City approvals, it is likely it will forward. Anticipated occupancy is late summer 2012.

• Curt Gunsbury received Planning Commission approval in May 2010 to build Solhem East

Bank, a 75-unit apartment building at the intersection of Delaware Street and Huron Boule-vard. The rental units will include a mix of 5 studio units, 20 one-bedroom, 10 one-bedroom-plus-den, and 40 two-bedroom units with high-end features. The project is cur-rently under construction and is expected to open in Fall 2011.

HOUSING NEEDS ANALYSIS


Introduction Previous sections of the study analyzed demographic, economic, and housing market characteris-tics and trends of the four neighborhoods in the University District. This section presents our estimates for the need for various types of housing between 2010 and 2020 in the University District as a whole. Demand calculations are based on the medium growth scenario for each type of housing. General Occupancy Housing Needs Analysis Rental Housing Needs Analysis Table HNI presents our calculation of general-occupancy rental housing demand for the Univer-sity District. A portion of the demand will be drawn from existing households in the neighbor-hood that want to upgrade their housing situations. Because of the regional draw of the Univer-sity District from throughout the Twin Cities area, the methodology also accounts for a portion of the demand drawn from outside the University District. First, we calculate potential demand from new household growth over the next ten years. Between 2010 and 2020, the University District is projected to add approximately 1,020 new households. For purposes of our analysis, we focus on households between the ages of 18 and 64 that will account for the vast majority of general-occupancy rental demand. Based on our analysis of household growth forecast in specific age cohorts, we estimate that 70% of these households will support demand for general occupancy housing products, generating total demand for over 700 general occupancy housing units between 2010 and 2020. Next, we calculate the percentage of household growth that will likely rent their housing. In 2010 approximately 82% of householders rented their housing in the University District, result-ing in demand for about 585 new renter households over the next decade. Because of the loca-tion in proximity to the University of Minnesota and Downtown Minneapolis, new rental devel-opment in the neighborhood will attract householders from throughout the Metro Area. We conservatively estimate that 50% of demand for rental housing in the University District will come from existing householders outside the neighborhood. As a result, we find demand for about 1,170 renter households based on household growth alone between 2010 and 2020. The second part of our analysis calculates demand from existing households, or turnover de-mand. Younger households tend to be highly mobile, relative to older households. The youngest households are generally unable to afford rents at the top of the market unless they receive assistance from their parents or desire a roommate. Consequently, the University District has an exceptionally high renter proportion and mobility rate, due in part to its location near the Univer-sity of Minnesota. Mobility rates were calculated for the renter population based on Census data and were applied to the existing renter household base. Finally, we estimate 10% of the existing renter households will seek new rental housing, resulting in demand for another 933 units over the next ten years.



Projected household growth in University District 2010 to 2020¹ 1,018(times) Pct. of HH growth for general occupancy housing2 x 70%(equals) Projected demand for general occupancy units = 713

(times) Propensity to Rent x 82%(equals) Number of potential renter households from HH growth = 584

(times) Rental demand generated from outside the University District + 50%(equals) Total demand potential for rental housing in the University District (2010 to 2020) = 1,169

Demand from Existing Renter HouseholdsNumber of renter households (age 64 and younger) in University District, 2010 = 9,930

(times) Estimated % of renter turnover (2010 to 2020)4 x 94%(equals) Total existing households projected to turnover annually = 9,334

(times) Estimated % desiring new rental housing x 10%(equals) Demand from existing households = 933

Total Demand From Household Growth and Existing Households, 2010 to 2020 = 2,102Subsidized Affordable Market

(times) Percent of rental demand by product type5 x 25% 25% 50%(equals) Total demand for new general occupancy rental housing units = 526 526 1,051

(minus) Units under construction or approved for development at equilibrium (95% occupancy)6 - 0 0 482(equals) Excess demand for new general occupancy rental housing = 526 526 569

2 Pct. of household growth age 65 and younger (U.S. Census - 2000).3 Propensity rent based on households under age 65 in 20104 Based on household turnover and mobility data (U.S. Census - 2000).5 Based on existng housing supply and proportion of households that income-qualify for each housing product.6 The majority (75%+) of units under construction or planned are student-oriented.


Demand from Projected Household Growth

1 Estimated household growth based on Metropolitan Council forecasts, 2009 to 2020.

HN1GENERAL OCCUPANCY RENTAL HOUSING DESMAND


Together with demand from projected household growth and turnover, the total rental demand in the University District is approximately 2,100 units through 2020. Based on a review of house-hold incomes and sizes, we estimate that approximately 25% of the total demand will be for subsidized housing, 25% will be for affordable housing and 50% will be for market rate housing. Finally, we subtract housing projects that are under construction or pending at this time, since these projects will satisfy some of the calculated demand for general occupancy rental housing. There are no affordable or subsidized general-occupancy projects in the development pipeline at this time. However, there are a number of market rate projects either under construction or in the planning phases. After accounting for a 5% vacancy factor, there are about 480 market rate units to be subtracted from total demand. Consequently, about 75% of these units are student-oriented projects. After accounting for pending/planned projects, demand for market rate units is reduced to 569 units over the next ten years. During the same time, there is demand for 1,050 subsidized and affordable units through this decade.



For-Sale Housing Needs Analysis Table HN2 presents our demand calculations for general occupancy for-sale housing in the University District between 2010 and 2020. Because the University District is fully developed, all new for-sale housing is likely to be in multifamily developments such as condominiums or townhouses. Like general-occupancy rental housing, demand for new for-sale housing will also derive from both new household growth and turnover from existing households. Between 2010 and 2020 the University District is projected to add 1,018 new households. Based on our analysis of house-hold growth forecast in specific age cohorts, we estimate that 70% of these households will support demand for general occupancy housing products, generating total demand for 713 general occupancy housing units between 2010 and 2020. Demand for housing is apportioned between ownership and rental housing products. According to historic U.S. Census data and Maxfield Research adjustments, approximately 18% of households under age 65 owned their housing in 2010 in the University District. Applying this percentage to the total demand for general occupancy units yields demand for 128 for-sale units between 2010 and 2020. Next, we estimate that 50% of the total demand for new for-sale units in the University District will come from people currently living outside of the neighborhood. A portion of this market will be former residents of the area and second home-buyers, such as “snow-birds” heading south for the winters. Adding demand from outside the University District to the existing demand potential in the Market Area, results in a total estimated demand for 257 for-sale housing units 2020. In conjunction with new household growth, demand is forecast to emerge from existing University District householders through turnover. An estimated 2,335 owner-occupied households are located in the University District in 2010. Based on mobility data from the Census Bureau, an estimated 61% of owner households will turnover in a ten-year period, resulting in about 1,425 existing households projected to turnover. Finally, we estimate 10% of the existing owner households will seek new for-sale housing in the University District, resulting in demand for another 143 for-sale units over the next ten years. Together with demand from projected household growth and turnover, the total for-sale demand in the University District is approximately 400 units through 2020. Based on the limited land available, building trends, and demographic shifts (increasing older adult population), we project 70% of the for-sale owners will prefer condominiums or cooperatives, while the remaining will prefer a townhome style unit.



Projected household growth in University District 2010 to 2020¹(times) Pct. of HH growth for general occupancy housing2 x(equals) Projected demand for general occupancy units =

(times) Propensity to Own3 x(equals) Number of potential owner households from HH growth =

(times) Ownership demand generated from outside the University District +(equals) Total demand potential for ownership housing in the University District (2010 to 2020) =

Demand from Existing Owner HouseholdsNumber of owner households (age 64 and younger) in University District, 2010 =

(times) Estimated % of owner turnover (2010 to 2020)4 x(equals) Total existing households projected to turnover between 2010 and 2020 =

(times) Estimated % desiring new owner housing x(equals) Demand from existing households =

Total Demand From Household Growth and Existing Households, 2010 to 2020

Condo Townhome

(times) Percent desiring for-sale condomiums/townhomes5 x 70% 30%(equals) Total demand potential for new multifamily for-sale housing = 279 120

(minus) Units under construction or approved for development - 0 0(equals) Excess demand for new general occupancy rental housing = 279 120

2 Pct. of household growth age 65 and younger (U.S. Census - 2000).3 Pct. Owner households age 65and younger (2010)4 Based on household turnover and mobility data (U.S. Census - 2000).5 Based on preference for housing type and land availability


25750%

399

143

61%

2,337

10%

1,426

HN2FOR-SALE MULTIFAMILY HOUSING DEMAND


Demand from Projected Household Growth

1 Estimated household growth based on Metropolitan Council forecasts, 2009 to 2020.

1,01870%713

18%128

There are no pending for-sale units under construction or pending at this time. Therefore, total demand through 2020 results in about 280 condominium units and 120 townhome units. The University District may be able to support a much higher number of for-sale units between 2010 and 2020 than presented in Table HN2. The University District parcels most likely to support for-sale development are located on former industrial sites in Marcy-Holmes near the Mississippi River. Condominiums developed on similar parcels in Marcy-Holmes and Down-town Minneapolis have proven to be highly desirable and capable of drawing residents from long distances. A well-designed condominium development on such a parcel could capture demand from a significantly larger base of households than would a more typical housing development.



Senior Housing Needs Analysis Active Adult/Few Services Table HN3 presents our demand calculations for active adult market rate housing in the Univer-sity District for 2010 and 2015. The market for active adult housing is comprised of older adult (age 55 to 64), younger senior (age 65 to 74) and older senior (age 75+) households, with market demand weighted most heavily toward older seniors. In order to arrive at the potential age-, income- and asset-qualified base for active adult housing, we include all age-qualified households with incomes of $30,000 or more plus homeowner households with incomes between $20,000 and $29,999 who would qualify with the proceeds from a home sale. The number of qualifying homeowner households is estimated by applying the appropriate homeownership rate, as identified in Table D11, to each age cohort. In 2010, we estimate there are 1,426 age-, income- and asset-qualified households in the University District that comprise the market for active adult housing. Adjusting to include appropriate capture rates for each age cohort (0.5% of households age 55 to 64, 5.5% of households age 65 to 74, and 16.5% of households age 75 and older) results in a demand potential for 71 active adult housing units in 2010. We also account for an additional portion of seniors (30%) who currently reside outside the University District but may choose a project within it. Including seniors from outside the University District, we find total demand for 101 market rate active adult housing units. Demand for active adult housing in the University District is apportioned between ownership and rental product types. Based on the age distribution of the University District population and homeownership rates, we project that 50% of the demand will be for owner-occupied active adult housing (51 units) and 50% of demand will be for rental active adult housing units (51 units). There is currently no market rate active adult housing in the University District, resulting in demand for 51 owner-occupied and 51 renter-occupied units in 2010. Adjusting for inflation, we estimate that households with incomes of $35,000 or more and homeowners with incomes of $25,000 to $34,999 would be candidates for active adult housing in 2015. Since there are no senior housing developments planned or proposed at this time, there are no new competitive units to account for. Therefore, we project that demand for active adult senior housing in the University District will increase to 64 owner-occupied and 64 renter-occupied units in 2015.



55-64 65-74 75+ 55-64 65-74 75+

# of Households w/ Incomes of >$30,0001 745 302 267 857 433 340

# of Households w/ Incomes of $20,000 to $29,9991 + 110 50 64 + 84 36 47(times ) Homeownership Rate x 52% 47% 48% x 52% 47% 48%

(equals) Total Potential Market Base = 802 326 298 = 901 450 363

(times) Potential Capture Rate x 0.5% 5.5% 16.5% x 0.5% 5.5% 16.5%(equals) Demand Potential = 4 18 49 = 5 25 60

Total Demand Potential from University District Residents = 71 = 89

+ 30 + 38= 101 = 127

Owner- Renter- Owner- Renter-Occupied Occupied Occupied Occupied

(times) % by Product Type x 50% x 50% x 50% x 50%(equals) Demand Potential by Product Type = 51 = 51 = 64 = 64

(minus) Existing and Pending Active Adult Units² - 0 - 0 - 0 - 0(equals) Excess Demand for Active Adult Housing = 51 = 51 = 64 = 64


TABLE HN3MARKET RATE ACTIVE ADULT/FEW SERVICES HOUSING DEMAND

UNIVERSITY DISTRICT2010 & 2015

¹ 2015 calculations define income-qualified households as all households with incomes greater than $35,000 and homeowner households with incomes between $25,000 and $34,999.² Existing and pending are deducted at market equilibrium, or 95% occupancy.

2010 2015Age of Householder Age of Householder

(plus) Demand from outside the University District (30%)(equals) Total Demand Potential in the University District

Congregate Table HN4 presents our demand calculations for congregate senior housing in the University District in 2010 and 2015. This analysis focuses on the potential private pay/market rate de-mand for congregate units in the University District. In order to arrive at the potential age-income qualified base for congregate senior housing, we include all senior households with incomes of $30,000 or more and homeowners with incomes between $20,000 and $30,000 who would qualify with the proceeds from a home sale (this proportion was estimated based on the homeownership rates for each age cohort). Senior householders with incomes of $30,000 allocating 60% of their income toward base housing costs could afford beginning rents of $1,500. We estimate the number of age/income/asset-qualified households in the University District as of 2010 to be 625 households. Demand for congregate housing is need-driven, which reduces the qualified market to only the portion of seniors who need some assistance. Thus, the age/income-qualified base is multiplied by the percentage of seniors who need some assistance with instrumental ADLs (IADLs; at least three), but not six or more ADLs/IADLs, as these frailer seniors would need the level of care found in assisted living.



# of Households w/ Incomes of $30,000+ in 2010 / $35K in 2015(plus) + +# of Hhlds w/ Incomes of $20K - $30K in 2010 / $25K - $35K in 2015(times) Homeownership Rate x x(equals) Potential Market = =

(equals) Total Potential Market Base = =(times) Potential Capture Rate of Congregate Housing1 x x(equals) Potential Demand = + = +

Total Local Demand Potential = =(plus) Demand from Outside the University District (30%) + +(equals) Total Demand Potential = =

(minus) Existing Competitive Units2 - -(equals) Excess Demand Potential for Congregate Housing = =


TABLE HN4CONGREGATE HOUSING DEMAND


2010 2015Age of

HouseholderAge of

Householder65-74 75+ 65-74 75+302 267 433 340

50 67 36 4747% 48% 47% 48%24 32 17 23

326 299 450 3633.0% 9.0% 3.0% 9.0%

10 27 13 33

37 4616 2052 66

0 052 66

2 Existing units at 95% occupancy.

1 The potential capture rate is derived from data from the Summary Health Statistics for the U.S. Population: National Health Interview Survey, 2007 by the U.S. Department of Health and Human Services. The capture rate used is the percentage of seniors needing assistance with IADLs, but not ADLs (seniors needing assistance with ADLs typcially need assistance with multiple IADLs and are primary candidates for assisted living.).

According to the Summary Health Statistics of the U.S. Population: National Health Interview Survey, 2007 (conducted by the U.S. Department of Health and Human Services), the percentage of seniors having limitation in activities of daily living (bathing, dressing, toileting, transferring, eating) and instrumental activities of daily living (using the telephone, shopping, food prepara-tion, housekeeping, laundry, transportation, taking medication, handling finances) are as follows: Limitation in ADLs & IADLs Age ADLs IADLs 65-74 years 3.3% 6.3% 75+ years 11.0% 20.0% It is most likely that seniors who need assistance with ADLs also need assistance with multiple IADLs, and are more likely to be candidates for assisted living. The prime candidates for congregate housing are seniors needing assistance with IADLs, but not ADLs. We derive the



capture rate for congregate housing by subtracting the percentage of seniors needing assistance with ADLs from those needing assistance with IADLs, which equals 3.0% of seniors ages 65 to 74 and 9.0% of seniors ages 75+. Multiplying the senior household base by these capture rates results in demand potential for 37 units of congregate housing from the University District in 2010. We estimate that seniors currently residing outside the University District will generate 30% of the demand for congregate senior housing – increasing total demand by 16 congregate units. Together, the demand from University District seniors and demand from seniors who would relocate to the University District totals 52 congregate units as of 2010. Next, existing congregate units are subtracted from overall demand. There are no congregate facilities in the University District, so total excess demand potential remains at 52 units. The same demand methodology is calculated for 2015. An increase in the number of senior house-holds results in total local demand potential for 46 congregate units in 2015. With 30% of demand coming from outside the University District and no pending congregate facilities in the University District, there is total excess demand potential for 66 units of congregate housing in the University District in 2015. Assisted Living Table HN5 presents our demand calculations for assisted living senior housing in the University District in 2010 and 2015. This analysis focuses on the potential private pay/market rate de-mand for assisted living units. The availability of more intensive support services such as meals, housekeeping and personal care at assisted living facilities usually attracts older, frailer seniors. According to the 2009 Overview of Assisted Living (which is a collaborative research project by the American Associa-tion of Homes and Services for the Aging, the American Seniors Housing Association, National Center for Assisted Living, and National Investment Center for the Seniors Housing and Care Industry), the average age of residents in freestanding assisted living facilities was 87 years in 2008. Hence, the age-qualified market for assisted living is defined as seniors ages 75 and over, as we estimate that of the half of demand from seniors under age 87, almost all would be from seniors over age 75. In 2010, there were an estimated 881 seniors age 75 and older in the University District.



Percent Number Percent Number Percent Number Percent NumberNeeding Needing Income- Income- Needing Needing Income- Income-

Age group People Assistance¹ Assistance Qualified² Qualified People Assistance¹ Assistance Qualified² Qualified75 - 79 318 19.5% 62 55% 34 351 19.5% 68 61% 4280 - 84 279 31.2% 87 50% 44 270 31.2% 84 60% 5185+ 284 49.5% 141 48% 67 315 49.5% 156 56% 87Total 881 290 145 936 309 180

Total potential market 145 180(times) Percent living alone x 63% x 63%(equals) Age/income-qualified singles needing assistance = 92 = 114

(plus) Proportion of demand from couples (12%)³ + 13 + 16(equals) Total age/income-qualified market needing assistance = 105 = 130

(times) Potential penetration rate4 x 40% x 40%(equals) Potential demand from University District residents = 42 = 52

(plus) Proportion from outside the University District (30%) + 18 + 22(equals) Total potential assisted living demand = 60 = 74

(minus) Existing market rate assisted living units5 - 0 - 0(equals) Total excess market rate assisted living demand = 60 = 74

Note: See footnotes on the following page.Source: Maxfield Research Inc.

2015

TABLE HN5MARKET RATE ASSISTED LIVING DEMAND


2010




2 Includes households with incomes above $40,000 (who could afford monthly rents of $3,000+ per month) plus 40% of the estimated owner households with incomes below $40,000 (who will spend down assets, including home-equity, in order to live in assisted living housing).

4 We estimate that 60% of the qualified market needing assistance with ADLs could either remain in their homes or reside at less advanced senior housing with the assistance of a family member or home health care, or would need greater care provided in a skilled care facility.

1 The percentage of seniors needing assistance with ADLs, based on the 1990 & 1991 panels of the Survey of Income and Program Participation (SIPP) files, conducted by the U.S. Census Bureau.

3 The 2009 Overview of Assisted Living (a collaborative project of AAHSA, ASHA, ALFA, NCAL & NIC) found that 12% of assisted living residents are couples.

Demand for assisted living housing is need-driven, which reduces the qualified market to only the portion of seniors who need assistance. According to a study completed by the U. S. Census Bureau (1990 & 1991 panels of the Survey of Income and Program Participation (SIPP) files), 30% of seniors needed assistance with everyday activities (from 19.5% of 75-to-79-year-olds, to 31.2% of 80-to-84-year-olds and 49.5% of 85+ year olds). Applying these percentages to the senior population yields a potential assisted living market of 290 seniors in the University District. Due to the supportive nature of assisted living housing, most daily essentials are included in monthly rental fees, which allow seniors to spend a higher proportion of their incomes on housing with basic services. Therefore, the second step in determining the potential demand for assisted living housing in the University District is to identify the income-qualified market based on a senior’s ability to pay the monthly rent. We consider seniors in households with incomes of $40,000 or greater to be income-qualified for assisted living senior housing in the PMA. House-holds with incomes of $40,000 could afford monthly assisted living fees of $3,000 by allocating 90% of their income toward the fees. According to the 2009 Overview of Assisted Living, the average arrival income of assisted living residents in 2008 was $27,260, while the average annual assisted living fee was $37,281 ($3,107/month). This data highlights that seniors are spending down assets to live in assisted living and avoid institutional care. Thus, in addition to households with incomes of $40,000 or greater, there is a substantial base of senior households with lower incomes who income-qualify based on assets – their homes in particular. Forty-eight percent of the age 75+ households in the University District are homeowners, and the median resale price of homes in the PMA in 2009 was about $216,170. Seniors selling their homes for the median resale price would generate about $201,000 in proceeds after selling costs. With an average monthly fee of $3,100, these proceeds would last over five years in an assisted living facility, which is longer than the average length of stay in an assisted living facility (27 months according to the 2009 Overview of Assisted Living). For each age group in Table HN5, we estimate the income-qualified percentage to be all seniors in households with incomes above $40,000 (who could afford monthly rents of $3,000+ per month) plus 40% of the estimated seniors in homeowner households with incomes below $40,000 (who will spend down assets,



including home-equity, in order to live in assisted living housing). This results in a total poten-tial market of 145 seniors from the University District in 2010. Because the vast majority of assisted living residents are single (88% according to the 2009 Overview of Assisted Living), our demand methodology multiplies the total potential market by the percentage of seniors age 75+ in the PMA living alone. Based on 2000 Census data, 63% of age 75+ households in the University District lived alone. This results in a total base of 92 age/income-qualified singles. The 2009 Overview of Assisted Living found that 12% of resi-dents in assisted living were couples. There are a total of 105 age/income-qualified seniors needing assistance in the University District including both couples and singles. We estimate that roughly 60% of the qualified market needing significant assistance with ADLs would either remain in their homes or less service-intensive senior housing with the assistance of a family member or home health care, or would need greater care provided in a skilled care facility. Assisted living housing could serve the remaining 40%. Applying this potential market penetration rate of 40% results in demand for 42 assisted living units in 2010. We estimate that a portion of demand for assisted living units in the University District (30%) will come from outside the University District. Applying this figure results in total potential demand for 60 market rate assisted living units in the University District. There are no competitive assisted living developments in the University District, so demand remains for 60 units in 2010. There are no pending units, and the 75+ population will increase by 2015, so total excess demand in the University District will increase to 74 units by 2015. Memory Care Table HN6 presents our demand calculations for market rate memory care senior housing in the University District in 2010 and 2015. Demand is calculated by starting with the estimated University District senior (age 65+) popula-tion in 2010 and multiplying by the incidence rate of Alzheimer’s/dementia among this popula-tion’s age cohorts. According to the Alzheimer’s Association (Alzheimer’s Disease Facts and Figures, 2007), 2% of seniors ages 65 to 74, 19% of seniors ages 75 to 84, and 42% of seniors ages 85+ are inflicted with Alzheimer’s Disease. This yields a potential market of about 250 seniors in the University District. Because of the staff-intensive nature of dementia care, typical monthly fees for this type of housing are at least $4,000 and range upwards of $5,000 when including service packages. Based on our review of senior household incomes in the University District, homeownership rates and home sale data, we estimate that 38% of seniors in the University District would have incomes and/or assets to sufficiently cover the costs of memory care housing. This figure takes into account married couple households where one spouse may have memory care needs and allows for a sufficient income for the other spouse to live independently. Multiplying the number of seniors with Alzheimer’s/dementia (251 seniors) by the income-qualified percentage results in a total of 96 age/income-qualified seniors in the University District in 2010.



According to data from the National Institute of Aging, about 25% of all individuals with memo-ry care impairments comprise the market for memory care housing units. This figure considers that seniors in the early stages of dementia will be able to live independently with the care of a spouse or other family member, while those in the later stages of dementia will require intensive medical care that would only be available in skilled care facilities. Applying this figure to the estimated population with memory impairments yields a potential market of 24 seniors in the University District.

65 to 74 Population 938 1,195(times) Dementia Incidence Rate¹ x 2% x 2%(equals) Estimated Age 65 to 74 Pop. with Dementia = 19 = 24

75 to 84 Population 597 621(times) Dementia Incidence Rate¹ x 19% x 19%(equals) Estimated Age 75 to 84 Pop. with Dementia = 113 = 118

85+ Population 284 315(times) Dementia Incidence Rate¹ x 42% x 42%(equals) Estimated Age 85+ Pop. with Dementia = 119 = 132

(equals) Total Senior Population with Dementia = 251 = 274

(times) Percent Income/Asset-Qualified² x 38% x 47%(equals) Total Income-Qualified Market Base = 96 = 129

(times) Percent Needing Specialized Memory Care Assistance x 25% x 25%(equals) Total Need for Dementia Care = 24 = 32

(plus) Demand from outside the University District (30%) + 10 + 14Total Demand for Memory Care Units = 34 46

(minus) Existing and Pending Memory Care Units3 - 0 - 0(equals) Excess Demand for Memory Care Housing = 34 = 46



2015

¹ Alzheimer's Association: Alzheimer's Disease Facts & Figures (2007)² Income-qualified households consider those with incomes greater than $60,000 in 2010 plus 15% of homeowners with incomes below this threshold. ($65,000 in 2015)

2010

TABLE HN6MEMORY CARE DEMAND


We estimate that 30% of the overall demand for memory care housing on the subject Site would come from outside the University District. Demand from both inside and outside the University District totals 34 memory care units in 2010.



Next, we subtract the existing market rate memory care units at 95% occupancy. However, since there are no existing or planned projects the total demand for memory care in the University District remains at 34 units 2010. The same calculations are applied to the age/income-qualified base in 2015. Since no proposed memory care developments were identified, no units are subtracted from the demand potential. Due to increased population and incomes over the next five years, demand in the University District is projected to increase to 46 units through 2015.

ALUMNI SURVEY


Maxfield Research Inc, in conjunction with the University Foundation, CURA, and the Office of Measurement Services conducted a survey of older adults (ages 45+) to gauge their level of interest in moving back/adjacent to the University of Minnesota Minneapolis campus. Survey results are posted in the Appendix of this document. Survey Sample Size/Methodology The following describes the target market and the methodology established for the survey. The survey was distributed via email with a greeting from Karen Himle of University Relations. The survey was distributed in November and December 2010 over a three-week period. A portion of the data was imported via University Relations databases. • Geography: Twin Cities CBSA (greater Twin Cities 13-county area) & the University

District • Target: Alumni Ages 45 and over and staff/faculty with email address by age weighted by

age cohort (45-54, 55-64, 65-74, 75+) • Sample Size: 4,145 surveys distributed between alumni in the Twin Cities CBSA (3,000

surveys) and ALL staff, faculty, and alumni 45 and over (1,145 surveys) currently residing in the University District neighborhood.

• Response Rate: A total of 444 surveys were returned (173 in the University District and 271 from the Twin Cities CBSA), resulting in an overall response rate of 10.7%. The response rate from the Twin Cities CBSA Area was 9.0% and 15.1% from the University District.

Summary of Findings • The majority of responders currently reside in a single-family detached home (73%), fol-

lowed by a townhome or condominium (14%) and a duplex or twinhome (6%). Only 5% of those surveyed lived in rental housing.

• A substantial percentage of those surveyed owned their home (93%). • Although the survey sought responses from both the University District and the Metro Area

geographies, over one-third of responses (35%) came from the Marcy Holmes, Como, or Prospect Park neighborhood.

• The gender of survey was rather equally divided between female (52%) and male (48%)

respondents. • Survey responders were born between 1922 and 1965 (ages 46 to 89), while the average age

of responder was 62 (born in 1949). Although responses spanned a large age range, the re-sponse rates decreased with age (37% of respondents born in 1950s vs. 3% of respondents born prior to 1930).

• Slightly over one-half of respondents (52%) are married. However, it is unknown what the

marital status is on about one-third of survey respondents.

ALUMNI SURVEY


• Based on imported data from the University Foundation, nearly 40% of respondents were either current or past faculty or staff of the University of Minnesota. The remaining 61% of respondents were alumni only.

• Respondent household incomes were high compared to household incomes of the same age-

cohorts in the Metro Area. The average household income was $92,165, while the median was $67,500. Approximately 40% of respondents had incomes between $50,000 and $100,000, 30% had more than $100,000, and 30% had less than $50,000.

• Over one-third of survey responders moved within the past two years, and nearly 60% had

moved within the past five years. However, approximately 30% of respondents have resided in their current home for more than 11 years.

• When asked about their feelings regarding housing on or near the University of Minnesota,

55% of survey responders said they would or may consider moving to housing in close prox-imity to the University of Minnesota. These same respondents said the primary reason they might move near the University of Minnesota was for the campus environment, cultural ac-tivities, central location, and proximity to employment.

• If anticipating a move in the future, about one-quarter of respondents mentioned within three

years and nearly 40% stated within five years. About 30% of survey responders do not plan to move at all in the future.

• For those not considering moving near the University of Minnesota, the most common

reasons were wanting to stay in their current neighborhood and near family and friends. • The vast majority of survey respondents prefer a multifamily product type in their next move.

In order of preference, respondents favored condominiums, townhomes, senior hous-ing/retirement community, and apartments.

• When asked about the type and style of housing, survey respondents prefer larger units. The

preferred unit type was two-bedroom with den (34%), followed by a large two-bedroom (18%), and small two-bedroom (15%). However, 17% of those surveyed the unit size is de-pendent on the community features and amenities.

• Alumni were asked what the University of Minnesota could offer to attract them to housing

on or near the campus. The most important features were cultural events/activities, educa-tional opportunities, access to health care, and access to entertainment and shopping.

• Social and cultural opportunities, reduced vehicle usage, and pedestrian-friendly were the

highest ranked responses when solicited about the most important considerations deciding on a housing choice on or near the campus.

• The most common building features and services survey responders preferred were Hi-speed

Internet, guest parking, exercise facility, and transportation services.

ALUMNI SURVEY


• Nearly one-half of survey respondents are undecided if they prefer to rent or own their housing on or near the University of Minnesota campus. Only 12% prefer to rent, while 43% prefer to own.

• Only 11% of respondents stated they would be likely to place an advance reservation deposit

for new housing in the University District. About one-third of surveyed did not know or said “it depends.”

• About one-third of those surveyed would be willing to spend between $200,000 and

$300,000 on new housing on or near the University of Minnesota. Another 20% would spend more than $300,000, while 26% would spend between $150,000 and $200,000.

• Over 30% of responders do not plan to rent. However, 25% would pay between $1,000 and

$1,500 on rent, 21% would pay between $750 and $1,000, and 13% would pay between $1,500 to $2,000.

• When probed on the potential support for an age-restricted (55+) housing community on or

near the campus, 61% of respondents would consider purchasing or renting. Another 43% would spread the word, and 39% would provide referrals. Only 15% of respondents thought they would not support the project.

• Over one-half (53%) of the surveyed persons reside in a two person household, 24% live

alone, and 23% reside in a household of 3 or more. • Given the older demographic surveyed, 71% of respondents allocate less than 30% of their

gross income to housing related costs. About 20% pay between 30% and 40% of their in-come to housing costs, but only 8% of respondents pay more than 41%.

CONCLUSIONS AND RECOMMENDATIONS


Introduction This section summarizes demand calculated for specific housing products in the University District and recommends development concepts to meet the housing needs forecast over the next ten years. All recommendations are based on findings of the Housing Needs Analysis. The following table and charts illustrate calculated demand by product type. It is important to recognize that housing demand is highly contingent on projected household growth; household growth could be considerably higher through increased densities and if a greater supply of land would be available for development.

Type of Use

General-OccupancyRental Units - Market Rate 569Rental Units - Affordable 526Rental Units - Subsidized 526For-Sale Units - CondominumFor-Sale Units - Townhouse 120

Total General Occupancy Supportable 2,020

Age-Restricted (Senior)Market RateActive Adult 128

Ownership 64Rental 64

Congregate 66Assisted Living 74Memory Care 46

Total Market Rate Senior Supportable 314


TABLE CR1SUMMARY OF HOUSING DEMAND

UNIVERSITY DISTRICTJanuary 2011

2010 to 2020

2010 to 2015

279

Note: Due to limited land availabilty, not all of the demand may be able to be developed in the University District. In addition, "purpose built housing" (i.e. student housing) is not included in general-occupancy demand.

It is important to note that the demand figures are based on the moderate growth scenario and could be higher should a project capture a higher percentage of demand from outside the Univer-sity District. Due to the University District’s central location, proximity to the University of Minnesota and Downtown Minneapolis, the neighborhood is highly desirable and attracts householders from a large geography. Many newer housing projects have attracted mainly residents from outside the University District, especially riverfront condominiums and luxury



student housing projects. As a result, new housing development could exceed the projected demand. It should be noted that “purpose built housing” (i.e. student housing) is not included in general-occupancy demand figures. Although we recognize general-occupancy projects in close proxim-ity to the University of Minnesota may capture some university students, generally students prefer to reside in student-oriented housing.

General-Occupancy Demand by Type2010 to 2020

120

279

526

526

569

0 100 200 300 400 500 600

Rental Units - Market Rate

Rental Units - Affordable

Rental Units - Subsidized

For-Sale Units -Condominum

For-Sale Units -Townhouse

Units

Senior Housing Demand by Type 2010 to 2015

46

74

66

64

64

0 10 20 30 40 50 60 70 80

Memory Care

Assisted Living

Congregate

Adult - Rental

Adult - Owner

Units



Based on the finding of our analysis and demand calculations, Table CR2 on the following page provides a summary of the recommended development concepts by product type for the Univer-sity District over this decade. It is important to note that these proposed concepts are intended to act as a development guide to most effectively meet the housing needs of existing and future households in the University District. The recommended development types do not directly coincide with total demand as illustrated in Table CR1 due primarily to land availability and development constraints. Single-Family Housing As an urban neighborhood in the City of Minneapolis, the University District is fully developed and has extremely limited land available for redevelopment. Should the land supply be greater in the University District, we acknowledge that demand for single-family housing would be very strong. However, due to land constraints, we recommend that the neighborhood optimize the vacant and/or underutilized parcels by developing a variety of multifamily housing product types rather than single-family housing. The modest number of single-family housing recommended for the University District in the following discussion is a factor of the replacement need of older single-family homes. Due to the age, quality and price of the University District’s existing housing stock, most of the existing housing stock appeals to and meets the housing needs ranging from entry-level to move-up product types. Based on the number of homes at least 50 years of ago or older in the Univer-sity District, we estimate there are approximately 22 to 28 homes that could be replaced through 2020. The type of homes that would be replaced would likely be functionally obsolescent or simply have extensive deferred maintenance in which remodeling alone is no longer justified. As such, some existing homeowners or others seeking to live in the neighborhood may consider replacing existing housing stock with new single-family housing. We recommend that an additional 22 to 28 single-family homes be built in the University District, of which 6 to 8 would be entry-level ($225,000 to $300,000), 8 to 10 would be move-up ($350,000 to $500,000), and 8 to 10 would be executive homes (over $500,000). As stated earlier, should additional land become available for single-family housing, we believe the University District could support a much higher number of new single-family homes across a wider price point spectrum. We believe there is an opportunity to offer higher-amenity homes that would be attractive to households in the existing resident base who desire to continue to reside in the University District but find that little housing is available to meet their preferences. As earlier sections of the study discussed, some of the growth in the neighborhood is forecast in the older adult and senior age cohorts, which will support demand for new senior housing products in the University District. As these older adults and seniors relocate to other housing options, their existing single-family homes will become available for new younger households to purchase.



Purchase Price/ Pct. of DevelopmentMonthly Rent Range¹ Total Timing

Owner-Occupied Housing (General-Occupancy)Single-Family/Detached Townhomes²

Entry-Level $225,000 - $300,000 6 - 8 27% 2011+ (ongoing)Move-up $350,000 - $500,000 8 - 10 36% 2011+ (ongoing)

Executive $500,000+ 8 - 10 36% 2011+ (ongoing)Total 22 - 28 100%

Multifamily Townhomes/Twin HomesEntry-level $200,000 - $250,000 25 - 30 22% 2013+

Move-up $325,000 - $450,000 45 - 50 39% 2013+Executive $450,000+ 45 - 50 39% 2013+

Total 115 - 130 100%

Condominiums3

Entry-level $175,000 - $250,000 110 - 130 42% 2014+Move-up $275,000 - $350,000 80 - 90 31% 2014+

Upper-end $375,000+ 70 - 80 27% 2014+Total 260 - 300 100%

General Occupancy Rental Housing (Non-Student Oriented)4

Market Rate Rental Housing $800 - $1,850 350 - 450 64% 2011+Affordable Rental5 50% to 120% AMI 150 - 200 27% 2011+Subsidized Rental6 30% AMI 50 - 100 9% 2011+

Total 550 - 750 100%

Senior Housing

Active adult affordable rental ** Moderate-income 50 - 60 16% 2011+Active adult market rate rental ** $875 - $1,800 50 - 60 16% 2012+

Active adult owner Market (coop/condominium) 70 - 90 22% 2013+Congregate $1,500 - $2,400 50 - 60 16% 2013+

Assisted Living $2,900 - $3,900 60 - 75 19% 2012+Memory Care7

$4,500 - $6,500 35 - 45 11% 2012+Total 315 - 390 100%

Alternative Development Concept**Active adult rental - mixed income Mix of MR & affordable 90 - 100 29% 2011+

¹ Pricing in 2011 dollars. Pricing can be adjusted to account for inflation.

7 Memory care housing could be a component of a assisted-living or service-intensive congregate building


TABLE CR2RECOMMENDED HOUSING DEVELOPMENT


No. of Units

3 Condominium development could exceed recommended units through high-rise development.

² Replacement need only - based on age of housing stock 50 years and older. Development of single-family or detached townhomes will hinge on land availability and functional obsolence of existing older housing stock. Due to the University District's location, there is pent-up demand that exceeds the replacement need.

6 Although there is demand for over 500 subsidized units over the decade it will be very challenging to develop, given land costs in the University District

4 Student housing demand is above & beyond general-occupancy demand

Note: The University District may not be able to accommodate all recommended housing types based on land availability and development constraints. Recommended development does not directly coincide with total demand.

** Alternative development concept is to combine active adult affordable and active adult market rate into one mixed-income community.

5 The University District could potentially support multiple affordable products through 2020. However, we recommend phasing affordable housing development over the next decade.



For-Sale Townhomes/Twin Homes Based on the availability of land, demographics of the resident base and forecast trends, we find demand for 120 new attached multifamily townhome style housing units. These attached units could be developed as townhomes/row homes, twin homes or a combination of the two housing products. Due to the current recession and the slowdown in the for-sale housing market, we recommend waiting until 2013 or later to move forward with additional for-sale townhome style housing products. Townhome style for-sale housing would be well received in the University District, however due to land availability it may be difficult to achieve. In total, we recommend development of 25 to 30 entry-level townhome units ($200,000 to $250,000), 45 to 50 move-up units ($325,000 to $450,000), and 45 to 50 executive townhomes ($450,000 and over). • Side-by-Side and Back-to-Back Townhomes – This housing product is designed with four or

more separate living units in one building and can be built in a variety of configurations. With the relative affordability of these units and multi-level living, side-by-side and back-to-back townhomes have the greatest appeal among entry-level households without children, young families and singles and/or roommates across the age span. However, two-story townhomes would also be attractive to middle-market, move-up, and empty-nester buyers. Many of these buyers want to downsize from a single-family home into maintenance-free housing, many of which will have equity from the sale of their single-family home. Al-though a primary reason for attached multifamily housing is affordability, we recommend that attention be placed on the visual and structural quality of housing as well as its compa-tibility with the architecture of surrounding neighborhood. We recommend side-by-side units, which tend to appeal to a slightly broader market, includ-ing older adults and retirees as well as younger families with children. Side-by-side units (or rowhomes) would increase density and could provide higher returns on investment. As-sociation-maintained townhomes and/or rowhomes can have lot widths ranging from 22’ to 35’.

• Twinhomes and One-Level Townhomes – By definition, a twin home is basically two units with a shared wall with each owner owning half of the lot the home is on. Some one-level living units are designed in three- or four-unit buildings in a variety of configurations. The swell of support for twinhome and one-level living units is generated by the aging baby boomer generation, which is increasing the numbers of older adults and seniors who desire low-maintenance housing alternatives to their single-family homes but are not ready to move to service-enhanced rental housing. Housing products designed to meet the needs of these aging University District residents, many of whom desire to stay in the neighborhood if housing is available to meet their needs, will be needed into the foreseeable future. We recommend that development of twinhomes and one-level townhomes be a comprised of a higher percentage priced above $350,000. Many seniors will move to this housing product with substantial equity in their existing single-family home and will be willing to purchase a



nicer, more efficient home that is similar to or slightly above the price point of their existing single-family home.

The twinhomes should be association-maintained with 40’- to 50’-wide lots on average. Al-though this product would be well-received, the product’s density may be low for some de-velopers and the one-story architecture may not synergize with the neighboring two-story single-family properties through much of the University District.

Condominiums Given the University District’s excellent urban location, the neighborhood is well-positioned to attract condominium development once the real estate market has stabilized. A condominium project would appeal to a wide range of buyers, including entry-level, move-up, and executive buyers, as well as independent seniors. These prospective buyers would be attracted to condo-minium housing near employment, Downtown Minneapolis, the University of Minnesota, retail and services, and close proximity to major roadways and transit. Through 2020, we recommend development of 110 to 130 entry-level condominiums ($175,000 to $250,000), 80 to 90 move-up units ($275,000 to $350,000), and 70 to 80 upper-end condominiums ($350,000+). Condominium development could be spread across a variety of building types; from low-rise to high-rise construction. However, the number of units con-structed in the University District could surpass the recommended units through housing density. For example, a new high-rise condominium project near the Mississippi River would attract buyers from throughout the Metro Area and would capture only a proportion of University District existing householders. Due to the continued soft condominium market in Downtown Minneapolis, we do not recom-mend new condominium development to come online for at least three more years. The lending environment for condominiums continues to be the principal hurdle at this time for both devel-opers and condo buyers. General Occupancy Rental Housing The competitive inventory among surveyed properties in the University District indicate pent-up demand due to low vacancy rates. Maxfield Research found vacancy rates of 3.8% among market rate general-occupancy projects and 1.4% among student-oriented rental projects. Falling home prices and home sales, together with increased demographic demand, have boosted the rental housing market. New general-occupancy rental housing can be developed immediately and will continue to be in high demand through this decade. As illustrated in Table P1, there are a number of student-oriented rental developments planned or pending, however there are very few projects planned that target the non-student population. Based on our analysis, we recommend the following housing types. • Market Rate General Occupancy Rental – The existing rental supply in the University

district (excluding student-oriented projects) is generally characterized by an older housing



stock, smaller buildings (under 30 units), and a high percentage of smaller unit sizes. As a result, many of these buildings do not offer amenities today’s renters seek. Based on our analysis, the University District can accommodate 350 to 450 new market rate rental housing units through 2020.

New rental properties under construction or recently developed in the Twin Cities are charg-ing rents on average from $1.25 to $1.50 per square foot in suburban locations to $1.80 to $2.20 per square foot in high-amenity urban locations in Downtown Minneapolis and Up-town. New suburban properties in third and fourth-tier suburban communities such as Lakeville, Eagan and Woodbury are charging between $1.25 and $1.40, on average. A project in the University District would likely command rental rates in the $1.65+ per square foot range, depending on location and amenities. New rental development in the University District will be attractive to a diverse resident profile, but we anticipate a higher proportion of young to mid-age professionals as well and singles and couples across the age span would be captured by new development. Addition-ally, new apartment construction would be attractive to recent college graduates, faculty and staff at the University of Minnesota, as well as a small proportion of older adults looking to downsize from existing owner-occupied housing in the neighborhood.

• Affordable Rental Housing – Although there is demand for over 500 affordable units in the

University District through 2020, it will be very challenging to develop affordable housing to that extent over the next decade. As illustrated in Table CR2, the University District can easily support 250 to 300 new affordable rental units through 2020. Much of the existing rental housing stock that functions as affordable housing (indirectly) is located in multistory buildings with a higher percentage of smaller unit types, which often cannot com-fortably accommodate family households. Efforts to maintain and/or improve the quality of these older properties may be needed in order to continue to provide high-quality housing that meets the needs of moderate-income households.

New affordable units would attract many existing University District residents residing in older market rate properties seeking larger unit sizes and more modern unit and building amenities. In addition, affordable housing will be attractive to households from outside the University District who seek to reside in the neighborhood to have close proximity to em-ployment, the University of Minnesota, Downtown Minneapolis, etc. Although a townhome concept would be well-received by moderate-income families, land availability will likely force most affordable housing to be constricted in traditional apart-ment-style buildings that could accommodate larger unit sizes. However, there may be the ability to construct townhome style housing on infill sites and smaller redevelopment sites.

• Subsidized Rental Housing – Subsidized housing (also referred to as extremely low income) is income-restricted to households earning at or below 30% AMI. Rent is generally based on income, with the household contributing 30% of their adjusted gross income toward rent. As illustrated in Table CR1, there was demand for over 500 subsidized housing units in



the University District through 2020. Like affordable housing, it will be challenging to develop future subsidized housing projects that could accommodate all of this demand. As new rental housing stock is added to the University District, there may be increased oc-cupancies among the existing rental housing stock, particularly among older properties that are unable to compete with newer, contemporary market rate projects. Some of these older properties may be open to accepting vouchers as a measure to meet the demand for subsi-dized housing in the neighborhood.

Senior Housing As illustrated in Table S1, there are no market rate senior housing developments in the Universi-ty District. Consequently, demand exists for all product types along the continuum of care – from active adult housing with no services to service-intensive memory care senior housing. The forecast growth in the University District is a result of the existing population base aging into the older adult and senior age cohorts. Development of senior housing is recommended in order to provide housing opportunity to these aging residents in their stages of later life. The development of additional senior housing serves a two-fold purpose in meeting the housing needs in the University District and other established communities: older adult and senior residents are able to relocate to new age-restricted housing in the neighborhood, and existing homes and rental units that were occupied by seniors become available to other new households. Hence, development of additional senior housing does not mean the housing needs of younger households are neglected; it simply means that a greater percentage of housing need is satisfied by housing unit turnover. • Active Adult Rental – In the near-term, we recommend development of a 90 to 100 mixed-

income active adult rental project in the University District. Currently, no market rate or affordable (i.e. shallow subsidy) active adult rental housing is available in the University District. Older adults and seniors who desire these housing products have either been forced to relocate to other communities outside the neighborhood or are residing at general occu-pancy rental projects. We believe a mixed-income building would be an ideal development concept to create the most dynamic, inclusive community for active seniors and to temper stigmas and potential neighborhood opposition of affordable housing development.

Due to the current recession and housing market slowdown, many markets have experienced delays in realizing demand for market rate active adult housing. These delays are the result of seniors who choose not to sell their homes or find they are unable to sell their homes, along with the fact that active adult rental housing is not need-based. While the affordable component of the mixed-income building could be built as soon as this year, we recommend that development delay until 2012 in order to allow the market to regain momentum. Alter-natively, the project could be built in two phases (with affordable housing in the first phase) or, developed separately due to the existing market conditions.

• Active Adult Ownership – As previously discussed, the current housing slowdown has

greatly impacted the active adult senior market, especially age-restricted condominiums or



cooperatives. We forecast that owner-occupied, age-restricted housing will continue to be a product of choice for active seniors, and that demand for this housing product will increase into the foreseeable future. However, due to the slowdown in the housing market, it would be best to wait for a market recovery before moving forward with this housing product (2013 or later). We recommend development of a 70- to 90-unit senior cooperative or condominium building. A senior cooperative concept would be accepted by prospective purchases as a “safer” investment into age-restricted ownership.

• Service-Enhanced Senior Housing – Based on our analysis, we recommend development

of 50 to 60 congregate units, 60 to 75 units of assisted living housing, and 35 to 45 units of memory care housing. Based on the various dynamics impacting the senior housing market in the University District and lack of existing supply, we recommend that new ser-vice-enhanced housing could be delivered after 2012.

Alumni Housing/Retirement Communities Though not depicted in Table CR2, there has been interest within the University District regard-ing the University’s affiliation with potential “Alumni Housing” senior projects that would target older adults who have a common connection to the University of Minnesota. For purposes of our analysis, demand for alumni housing would echo senior housing demand. However, depend-ing on the affiliation with the University of Minnesota, demand could exceed the findings in Table CR1 with a synergistic partnership with the University that would attract residents from a large geographic area. As baby boomers have entered retirement age this year, it is anticipated many baby boomers have increased interest for lifelong education, social interaction, recreational opportunities, and proximity to university medical services. Accordingly, there has been recent interest from both private developers and universities who work together to market retirement communities to alumni. Not all senior housing projects near a university have a connection to the school. To be classified as a university-based retirement community, typically the following criteria should be imposed:

o A site location that is easily accessible to the university (ideally within a mile or less) o University programs that can be incorporated into the retirement community (i.e. con-

tinuing education, guest speakers, classes, etc.) o A documented relationship between the university and the senior-housing developer o Various levels of care – ideally ranging from active adult to assisted living and mem-

ory care o A minimal percentage of residents that have some connection to the school (i.e.

alumni, former staff or faculty, residents of the University District, etc.)



Student-Oriented Housing Although Maxfield Research did not calculate demand for student-oriented housing on or near the University of Minnesota, student housing projects could capture a small portion of total demand outlined in Table CR1. The University of Minnesota continues to have demand exceed-ing capacity for on-campus student housing. This past year about 300 students were relocated to temporary housing as on-campus facilities were not available. Together with on-campus beds (about 5,300) and off-campus master leases (about 1,000); the University of Minnesota can house about 6,300 students. The majority of these students are freshman as approximately 82% of enrolled freshman reside on-campus. With a total student population of over 46,000, the University is only capturing about 13% of its student population on-campus. Nationally, about 20% to 30% of a university’s total enrolled body resides on-campus. The chart below shows the number of university-owned beds among other Big Ten university’s compared to the total enrollment. As illustrated in the table, the University of Minnesota has the lowest bed/enrollment ratio among all Big Ten schools. Excluding the University of Minnesota, the remaining schools are able to accommodate about 27% of the total body on-campus. It is also interesting to note that universities located in more urbanized areas (i.e. Minnesota, Wiscon-sin, and Ohio) have the lowest university-owned bed-to-enrollment ratio. This is likely in part due to older, established neighborhoods with little land availability, increased land costs, and competition from the privatization of off-campus student housing in nearby neighborhoods.

School OwnedUniversity Name Location Total Undergrad Beds2 Total Undergrad

Minnesota - Twin Cities Minneapolis, MN 46,200 28,600 6,300 13.6% 22.0%

Illinois - Urbana-Champaign Champaign, IL 41,500 30,700 8,362 20.1% 27.2%Iowa Iowa City, IA 28,000 19,900 5,827 20.8% 29.3%Indiana Bloomington, IN 37,200 29,200 11,973 32.2% 41.0%Michigan - Ann Arbor Ann Arbor, MI 40,000 25,000 11,704 29.3% 46.8%Michigan State East Lansing, MI 43,900 35,000 15,700 35.8% 44.9%Northwestern Evanston, IL 17,300 8,100 6,000 34.7% 74.1%Ohio State Columbus, OH 50,400 37,100 9,936 19.7% 26.8%Penn State University Park, PA 41,700 35,700 13,660 32.8% 38.3%Purdue - West Lafayette West Lafayette, IN 38,700 31,000 11,590 29.9% 37.4%Wisconsin - Madison Madison, WI 39,900 28,500 6,891 17.3% 24.2%

1Enrollment data based on 2008 academic year.2 Per University of Minnesota Housing & Residential Life


Enrollment1 Bed/Enrollment Raio

UNIVERSITY OWNED BEDS BIG TEN SCHOOLS

Though projected Minnesota high school graduation rates are flat over the next five years, the demand for new student housing is still increasing as today’s echo boomers view many of the existing housing choices near the University of Minnesota as functionally obsolete. Together with high-occupancy rates at student-oriented properties, low school-owned bed to enrollment ratios, students taking longer to graduate, dwindling state budgets, and aging on-campus facili-ties, the increased privatization of student housing will likely continue. Therefore, the University



District will continue to be approached by student housing developers in the short-term looking to capitalize on this real estate product. Eventually, however, the market for high-end student housing will reach a saturation point as not all students are willing to pay excessive monthly rents. Challenges and Opportunities Table CR2 identified and recommended housing types that would satisfy the housing needs in the University District over the next nine years. The following were identified as the greatest challenges and opportunities for developing the recommended housing types. • Location. The University District’s central location near the University of Minnesota,

Downtown Minneapolis, employment concentrations, transportation corridors, urban envi-ronment, and the Mississippi River results in a highly desirable neighborhood for housing. The proximity to the University of Minnesota is the neighborhood’s biggest asset to some, yet principal challenge to some existing neighborhood residents.

Given the location qualities, the University District will continue to be sought after by pros-pective residents and housing developers. Many future residents will reside throughout the greater Metro Area and will seek out a development in the University District.

• Land Constraints. As previously stated, the University District has few existing parcels

within the neighborhood that can accommodate residential development. As a result, future housing development will occur on infill or redevelopment sites throughout the neighbor-hood. Due to these land constraints, the University District may not be able to accommodate all of the housing demand outlined in Table CR1. Consequently, the lack of land supply drives up the cost of land which places upward pressure on housing development, which in turn results in higher costs to the consumer.

Due the neighborhood’s location, housing demand could be significantly higher should the University District have the available land to accommodate future growth. All housing prod-ucts, ranging from low- to high-density would be desired in the neighborhood.

• Housing Densities. In an effort to reach the demand potential despite limited land, increased densities will allow for additional diverse housing products that will maximize the housing types developable on a parcel. Higher density projects can capitalize on economies of scale which provides greater affordability to the end user. The City of Minneapolis and/or neigh-borhood should allow for flexible zoning requirements and encourage creative site planning as a means to increase density and provide greater housing opportunities. Such flexibilities may include reductions in setbacks, parking requirements, floor area, lot area, etc. We espe-cially encourage higher densities near employment and transit corridors and new urbanism and mixed-use development. At the same time however, we recommend maintaining buffers between incompatible land uses.



The chart below shows net housing densities by product type that may be achieved. There is a movement in many Metro Area communities to smaller lot sizes through planned unit de-velopments that results in higher densities and more affordable housing costs. Given the ur-ban environment of the University District, nearly all future housing developments will be some variation of attached housing.

Product Type

Single FamilyExecutive (90' wide lot+) 1.75 - 2.50Standard (60'-80' wide lot) 2.75 - 3.75Small Lot (less than 50') 4.00 - 5.00

Detached Townhomes/Villas 4.50 - 6.00

Twin Homes 6.50 - 8.00Townhomes/Rowhomes 10.00 - 14.00Low/Mid-Rise Multifamily 40.00 - 50.00Six-Story Multifamily 65.00 - 75.00Hi-Rise Multifamily

Sources: Maxfield Research Inc., Urban Land Institute, Site Planning

Per Acre

DETACHED HOUSING

ATTACHED HOUSING

85+

TYPICAL HOUSING DENSITIES BY PRODUCT TYPENet Units

• Single-family Home Conversions. Converted single-family properties to student rentals

have brought lucrative returns to landlords. As investors have absorbed housing stock in the neighborhood, families and year-round residents have been priced out of the neighborhood. Consequently, existing homeowners in the neighborhood find absentee landlords to be one of the key issues affecting the neighborhood’s desirability. According to many homeowners, landlords do not maintain these properties while maximizing rental income through room-mate leasing and deferred maintenance. The continued movement of converted student hous-ing in once predominantly owner-occupied neighborhoods is a major concern for the Univer-sity District, as it is across many university communities in the country.

Another recent trend has been parents of college students purchasing homes for their children while leasing out the remaining bedrooms. Many parents view the housing as something that not only can provide housing to their college student, but as an investment that could appre-ciate in value for resale or a place for their own future retirement Although this trend has been increasing, this trend could slowly wane as increased student housing is developed near the campus core.

• Student Housing Industry. Over the past decade the student housing development industry

has grown locally and nationally with many student housing development firms traded publi-cally on the stock market. Combined with the recent downturn in the real estate industry in most sectors, student housing has been a “safe investment” for many developers and lenders.



Today’s new student housing complexes are nothing like the student housing concepts of yesterday (i.e. traditional dorms) as they target both the student and the parents. These facili-ties are amenity-rich while commanding premium rents. New off-campus housing typically includes amenities such as Internet access, business center, fitness center, full-size washer and dryers, high-end furnishings, study lounges, etc.

As illustrated in Table P1, the majority of housing under construction or planned is student-oriented. We expect this trend to continue as there is a disconnect between the current “tradi-tional” inventory and what today’s students desire. The continued development of large-scale student housing should eventually allow the neighborhood to reclaim former converted housing stock as students seek newer amenity-rich product closer to the University.

• Purpose Built Student Housing Communities. The notion of “Purpose Built Student

Housing” is that new off-campus housing adjacent to or on the University campus fulfills student housing needs over existing substandard housing options. New amenity-rich housing developments will put pressure on landlords who neglect their properties to either maintain or dispose of their investment property. The continued development of large-scale student housing should eventually allow neighborhoods to reclaim former converted housing stock as students seek newer product closer to the University core.

• Code Enforcement/Inspections. Being an urban university campus, the University of

Minnesota is landlocked by the surrounding University District neighborhoods. As enroll-ments have increased through the years dormitory capacities and amenities have not kept-up with demand, resulting in more students living off-campus in the surrounding neighborhoods. This is a common theme found in urban college campus across the country. The influx of students into the neighborhood has been challenging for many existing owner-occupied householders who have resided in the neighborhood over time. Stereotypically, college students behave like “college students” – late-night parties, garbage piled-up at the curb, tenants crowded into homes, etc. Many students seek cheap housing and are willing to reside in terrible living conditions if the price is right. Some landlords take advantage of the situation by not maintaining properties as they fear students will destroy the property. Exist-ing homeowners concerned over a variety of problems have demanded the University and local governments take action. Although the City has active code enforcement personnel, many University District residents feel more action needs to be taken.

• Aging of Population. As illustrated in the Demographic Analysis section of the report, the University District is aging and will continue to age for the next few decades. The leading edge of the baby boom generation entering their mid-60s in 2011 and the demand for senior housing is expected to be strong past 2030 in the Metro Area. Projected senior household (65+) growth is expected to increase by over 20% through 2015 in the University District. Many baby boomers will desire to retire near their existing residence and will seek a main-tenance free housing type initially, before needing housing with services after 2020.

The development of age-specific housing to accommodate this demographic shift will free up the existing housing stock for new younger generations.



• Increased Home Ownership. The propensity to own a home in the University District is approximately 20% in 2010. Compared to the City of Minneapolis (51%) and the Twin Ci-ties Metro Area (71%), the ownership rate is considerably low. Homeownership is more than having a roof over one’s head; ownership offers long-term investment that typically builds wealth over time. The social benefit of home ownership is increasingly vital for communi-ties. Studies have shown that home ownership increases family stability, produces better out-comes for children, and helps homeowners feel a part of community life. Homeowners who anticipate a return on their investment are more apt to maintain and improve their properties, thereby improving their neighborhood and the surrounding community. These improvements help to stabilize the neighborhood, which in turn helps support businesses, schools, and in-creases the overall vitality of the community. In addition, data from the Federal Reserve shows a large disparity in wealth between owners and renters. In 2007 (the most recent data from the Federal Reserve) the median net worth of homeowners was $234,000 compared to $5,100 for renters.

Although the University District has strived to increase homeownership rates, the current housing market downturn and ensuing recession has made purchasing a home particularly difficult for many householders over the past two to three years. Maxfield Research recog-nizes that home ownership is critical for neighborhood stability and prosperity. University District neighborhoods have all initiated programs to assist home ownership and rehabilita-tion in their respective neighborhoods. We recommend the continued implementation of ex-isting programs and other measures to increase home ownership rates in the neighborhood. Suggestions include:

o Aggressive home-buying incentive programs to encourage University faculty, staff, and

others to move into the neighborhood. (i.e. lines of credit, low-interest loans, home-buying assistance programs, etc.) Various programs have been initiated in the Univer-sity District, but vary from neighborhood to neighborhood.

o Work with the University to offer free or reduced tuition to neighborhood home owners who meet admissions criteria (i.e. lived in neighborhood for five plus years, etc.)

o Home-buyer education o Rent-to-Own programs o Foreclosed property incentive program or rehabilitated foreclosed home

• Property Tax Concerns. Increasing property taxes in the City of Minneapolis for both

homesteaded and non-homesteaded properties has been a concern to property owners. Cur-rent 2011 tax levies for about two-thirds of property owners in Minneapolis found property tax increases averaging over 16% for the City portion alone, not counting county and school district taxes. Coupled with depressed real estate values, property owners have been in uproar over the tax increases. Increased property taxes could have a negative effect on real estate transaction activity and pricing should they become too burdensome for existing and future residents, especially those on fixed-incomes and seniors. Rental property tenants may also feel the impact with increased upward pressure on rents. Increased property taxes make the economics of affordable housing more challenging.



• Develop Higher-Density Housing near transit corridors. The new Central Corridor Light Rail Transit Line that is scheduled to open in 2014 will bisect portions of the University Dis-trict. Ridership projections during the weekday are estimated at 40,000 per day by 2030. As such, property near future transit station locations provides an excellent opportunity for rede-velopment, particularly higher-density housing.

• Renovation of Existing Housing Stock (both owner and rental). Numerous home im-

provement programs are initiated by local HRAs across the Metro Area to preserve the exist-ing housing stock while promoting energy efficiency improvements. Although each neigh-borhood has their individual programs, we recommend a “one stop” resource for property owners looking to improve residential real estate in the University District. A variety of pro-grams are available, the following is a list of potential programs.

o Loan for financing improvements (typically low-interest)

Energy efficiency programs (e.g. Neighborhood Energy Consortium) Minnesota Housing Finance Agency (MHFA) – fix-up loan and rehabilita-

tion loans, both low-interest and no-interest Deferred loan programs (e.g. Ramsey County deferred loan program) Affordable multi-family rental program loans

o Redevelopment Credit – remove a substandard home with new construction o Remodeling Advisor – Partner with local architects to provide ideas and general

cost estimates for property owners o Remodeling Plan Book – Many cities and/or neighborhoods have plan books for

remodeling homes of a particular character in the neighborhood o Construction Management Services – Assist homeowners regarding local building

codes, reviewing contractor bids, etc. o Housing Resource Center – A part of the Greater Metropolitan Housing Corpora-

tion, is a community service for homeowners providing free housing services in participating communities.

• Affordable Housing. Due to the central location of the University District and the desire to

convert existing housing stock into rental property, the neighborhood has become increasing-ly more expensive. Given the quality and older housing stock of entry-level single-family housing, many first-time buyers find housing costs high compared to other Minneapolis neighborhoods. This is further enhanced as many real estate listings promote the ability to obtain rental income from the property, thereby driving up the cost through marketing to in-vestors.

Consequently, there is a need for more diversity among housing types that are affordable, especially for families and seniors. Although there are a number of larger homes in the neighborhood, many of these properties are unobtainable financially for a number of fami-lies. In addition, there is a need for affordable age-restricted housing with and without ser-vices. We also recommend targeting housing assistance programs towards producing hous-ing for the workforce – or those households earning between 80% and 120% of AMI. Many householders who work at the University of Minnesota or Downtown Minneapolis would be attracted to a project located in the University District.



• Financial Barriers. The economics of developing affordable housing are difficult to achieve, especially with increasing land costs, property taxes, and competition from student housing developers and/or investors. Partnerships between the City and developers should be sought to help alleviate some of the overall carrying costs. In addition, the City should offer developer incentives and/or housing bonuses and should consider donating municipal owned land (if available) to affordable housing developers.

• Land Banking. Land Banking is a program of acquiring land with the purpose of develop-ing at a later date. After a holding period, the land can be sold to a developer (often at a price lower than market) with the purpose of developing housing. The University District and/or City should consider establishing a land bank to which private land may be donated and pub-lic property may be held for future housing development.

Mercer University students (Macon, Georgia) assisted City officials on completing a property database that helped neighborhood officials identify parcels under transition and where future housing opportunities could result. This effort enabled the local neighborhood to pursue in-fill development while staying ahead of student housing developers.

APPENDIX


APPENDIX

Alumni Survey The Alliance – A University District Partnership


APPENDIX – Alumni Survey Maxfield Research Inc, in conjunction with the University Foundation, CURA, and the Office of Measurement Services conducted a survey of older adults (ages 45+) to gauge their level of interest in moving back/adjacent to the University of Minnesota Minneapolis campus. Survey Sample Size/Methodology The following describes the target market and the methodology established for the survey. The survey was distributed via email with a greeting from Karen Himle of University Relations. The survey was distributed in November and December 2010 over a three-week period. A portion of the data was imported via University Relations databases. • Geography: Twin Cities CBSA & the University District • Target: Alumni Ages 45 and over and staff/faculty with email address by age

weighted by age cohort (45-54, 55-64, 65-74, 75+) • Sample Size: 4,145 surveys distributed between alumni in the Twin Cities CBSA

(3,000 surveys) and ALL staff, faculty, and alumni 45 and over (1,145 surveys) currently residing in the University District neighborhood.

• Response Rate: A total of 444 surveys were returned (173 in the University District and 271 from the Twin Cities CBSA), resulting in an overall response rate of 10.7%. The response rate from the Twin Cities CBSA Area was 9.0% and 15.1% from the University District.

Survey results noted on the following pages.



1. Please select the response that best describes your current living situation:

I/we live in a single-family detached home 323 73%I/we live in a duplex or twinhome 25 6%I/we live in a triplex or quad (i.e. 3-plex or 4-plex) 4 1%I/we live in a townhome or condominium 62 14%I/we live in an apartment with tenants of all ages (i.e. non-age restricted) 20 5%

I/we live in a mobile home 2 0%I/we live in a retirement/senior living community (i.e. age restricted) 2 0%

I/we live in another type of residence (please specify): 3 1%Total Responses 441 Comments: Other type of Residence: Condos - 1 Boarding House – 1



2. Do you own or rent your current home?

I/we own 408 93%I/we rent 33 7%

Total Responses 441



3. ZIP code of primary residence (Imported from University Foundation)

Zip code Number Pct.55414 156 35.1%55454 17 3.8%55126 12 2.7%55406 10 2.3%55105 10 2.3%55113 9 2.0%55436 7 1.6%55421 7 1.6%55082 7 1.6%55419 6 1.4%55416 6 1.4%55405 6 1.4%55112 6 1.4%55108 6 1.4%55104 6 1.4%

5 or Less 173 39.0%Sum 444 100.0%

Responses by Zip code

35%

4% 3% 2% 2% 2% 2% 2% 2% 1% 1% 1% 1% 1% 1%

39%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

5541

455

454

5512

655

406

5510

555

113

5543

655

421

5508

255

419

5541

655

405

5511

255

108

5510

4

5 or L

ess

Zip code

Pct.

Comments: The zip codes with 5 respondents or less from one specific zip code represent 39% of responses. However, each zip code represents less than 1% of the total response rate.



4. Gender (Imported from University Foundation)

Female 229 52%Male 215 48%Total Responses 444



5. Year born (Imported from University Foundation)

After 1960 63 14%1950-1959 163 37%1940-1949 139 31%1930-1939 64 14%Before 1930 15 3%Total Responses 444

Year Born

14%

31%

14%

3%

37%

0%

5%

10%

15%

20%

25%

30%

35%

40%

After 1960 1950 - 1959 1940 - 1949 1930 - 1939 Before 1930

Year

Pct.



6. Marital status (Imported from University Foundation)

Married 233 52%Unknown 140 32%Single 42 9%Widowed 17 4%Divorced 8 2%Partners 4 1%Total Responses 444



7. Faculty or staff (Imported from University Foundation)

Not Staff or Faculty 273 61%Staff 69 16%Past Staff or Faculty 62 14%Faculty 40 9%Total Responses 444



8. Income (Imported from University Foundation) Less than $15,000 54 12%$15,000 to $29,0000 9 2%$30,000 to $49, 999 66 15%$50,000 to $74,999 109 25%$75,000 to $99,999 70 16%$100,000 to $149,999 72 16%$150,000 or more 64 14%Total Responses 444 100%

Income

12%

2%

15%

25%

16% 16%14%

0%

5%

10%

15%

20%

25%

30%

less than$15,000

$15,000 to$29,999

$30,000 to$49,999

$50,000 to$74,999

$75,000 to$99,999

$100,000 to$149,999

$150,000 ormore

Income Range

Pct.



9. Owner or renter (Imported from University Foundation) Owner 354 95%Renter 18 5%Total Responses 372 Comments: Based on data imported from University Foundation. Similar data in Question #2 is based on results from survey participants and has a near 100% participant rate.



10. Length of years at current residence (Imported from University Foundation)

Length (in Years) Number Pct.Less than 2 Years 32 34.0%2 to 5 Years 23 24.5%6 to 10 Years 11 11.7%11 to 20 Years 16 17.0%20 or More Years 12 12.8%

Sum 94 100.0%

Years at Current Residence

34.0%

11.7%

12.8%

17.0%

24.5%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%

Less than 2 Years

2 to 5 Years

6 to 10 Years

11 to 20 Years

20 or More Years

Year

s

Pct.



11. Please select the following category that best describes your feelings regarding housing on or near the U of M Minneapolis campus: I/we would definitely consider moving to housing that would be located in close proximity to or on the U of M campus. 101 23%

I/we might consider moving to housing that would be located in close proximity to or on the U of M campus. 145 33%

I/we would not consider moving to housing that would be located in close proximity to or on the U of M campus. 198 45%

Total Responses 444



12. If you definitely or might consider a move, what is the primary reason you would consider this type of housing on or next to the U of M Minneapolis campus? Want to take advantage of cultural activities at the U of M 57 24%Want to take advantage of recreational activities at the U of M 9 4%Want to take advantage of educational opportunities at the U of M 33 14%Just want to be near the U of M campus environment 77 32%Other 64 27%Total Responses 240

Comments: Other: A already live in close proximity to the main campus. Other: Actually, I already live in the SE Como neighborhood Other: All of the above Other: all of the above and U MN athletics Other: All of the above. Other: Allof the above, including sports events, Weisman, bookstore, library Other: central location to all areas of the twin cities Other: central location, close to downtown, airport, St. Paul, etc. - Other: centrally located and potential light rail transportation Other: centrally located between and close to both downtowns Other: Centrally located in the Twin Cities and the ability to do the above as well. Other: close to work



Other: Close to work at the U; Good neighborhood Other: Closer to work Other: closer when on call for clinical services at the hospital Other: culture,recreation, education, public transport and facilities, business community, proximity to urban services Other: don't have to commute Other: Employed at U of M Other: For me, 'cultural activities' include recreational and educational Other: I already DO live in close proximity - Prospect Park - and enjoy the cultural activities at the U Other: I already live about 1 mile from East Bank campus Other: I already live in SE Como for all those reasons, plus it's close to my job on campus. Other: I already live in the Marcy Holmes neighborhood Other: I already live near the campus leaving other questions moot Other: I already live near the U of M campus and don't plan to move Other: I already live near the U of M in Como neighborhood however that was not an option to check Other: I grew up in this neighborhood and would like to stay living in it. Other: I like the old houses in the area and the culture Other: I live in Como now! Other: I live within 1 mile of the U campus right now Other: I work at the U Other: I work at the U of M. Other: I work in the area Other: I would want to be close to my fraternity. Other: I/we already live near the UMN campus Other: If we had to move we'd want to stay in our current neighborhood (near the U) Other: light rail transit Other: Like the River Road area Other: May have students attending in a few years Other: Proximity to work at the U Other: senior living Other: Stay close to our present neighborhood (Prospect Park) Other: strategic location on light rail that would give me easy access to both downtowns for my favorite cultural activities (MNO, SPCO) Other: Strong preference to live close to workplace = commute without car. Other: The above plus being able to walk to work. Other: to be closer to work Other: UofM is very conveniently located for many actvities in the Twin Cities. We already live in one of the University neighborhoods and would like to stay if we have to leave our home. Other: used to work at the U Other: Want appropriate over 55 housing, and the proximity of the U would be a plus. Other: Want to be near neighbors/contacts in this community. Nothing to do with U. Other: want to be near work, which is just off campus Other: We already live by the U, which was not an option above Other: We already live in close proximity Other: We already live near the Campus. Noisy but we're fine. Other: We already live near the University campus and have for many years. Other: We currently live next to campus Other: We do currently live near the U of M Campus; answers related to this Other: We have lived in Prospect Park (just east of U of M campus) for 35 years. We both worked at the U and



are now retired. We can't imagine living in any other neighborhood -- our friends are here, we do business here--it's where we want to live! Other: We're on the faculty and we live in Prospect Park. Other: within walking distance; I live here already so it's doubtful I'll move Other: worked at StPaul campus and love the area.

13. If anticipating a future move into housing that meets your needs, I/we anticipate such a move within: The next year 17 7%2-3 years 41 17%4-5 years 34 14%6-10 years 53 22%More than 10 years 31 13%I/we do not anticipate such a move 70 28%Total Responses 246



14. Why you would not consider housing on or next to the U of M campus? (Select all that apply). Am not interested in what the U of M has to offer 14 5%Do not like the neighborhood(s) where the U of M is located 33 12%Prefer to remain close to my friends and family 53 20%Prefer to remain in my own neighborhood 146 54%Not enough to do around the U of M campus (entertainment, shopping, etc) 6 2%

Prefer to leave the campus area when the work day is over 12 4%Other 96 36%

Total Responses 360

Comments: Other: Actually we are thinking of moving OUT of the neighborhood due to it's decline and it's absentee landlordism. Other: After graduating, why would anyone want to live in the cheap crappy area around campus? Other: Already close to U of M campus Other: Already in a home we love in SE Mpls Other: Already live within walking distance to the U of M Other: Already live a mile from campus on East River Parkway Other: already live close to campus Other: already live in the community Other: already live near campus in my own home



Other: already live near the UoM Other: Already reside near UOM Campus Other: Am already living 1.5 miles from u and value this highly Other: answered previously Other: As a middle aged adult just finishing a grad program I never lived on campus but in our family's house of 25 years. Other: Can't afford the real estate to have what we have in the suburbs Other: Cedar Riverside area has too much crime now, students are victimized around campus neighborhoods Other: does not apply Other: Don't need to move, We already live by campus. Other: Happily situated now in the U of M area Other: Have lived all of adult life near U it is wonderful! Other: Have not even thought about moving anywhere Other: I already live 1 mile from East Bank-but wish there were more single families that lived in the houses instead of renting them out and being absentee landlords Other: I already live around the campus and can't move any closer Other: I already live at the U Other: I already live close to the main campus. Other: I already live close to the university Other: I already live here and I like it Other: I ALREADY LIVE HERE!!!! Hello?? Other: I already live in a neighborhood close to the U Other: I already live in close proximity to the U of M campus; no need to move. Other: I already live in housing 3 blocks from work and don't need to move. Other: I already live in the neighborhood--Como SE Other: I already live near campus (Prospect Park) and don't plan to move anytime soon! Other: I already live near campus; so these questions make no sense to me. Other: I already live near the U of M Other: I already live near the u of M campus and do not need to move. Other: I already live next to the campus! Other: I already live next to the U of M Other: I already live next to the U of M campus and enjoy all the advantages thereof. Other: I already live next to the U of M campus, and moving is such a hassle, Why would I conder that. Other: I already live next to U of M campus!! Should I have not taken this survey? Other: I already live so close to the U Other: I already live within walking distance of the U of MN campus. Other: I already live within walking distance of campus Other: I am happy to already be living in the nieghborhood which is not only convenient to the U but also downtown. Other: I am not an alumnus of UM, nor do I work on campus. I have no idea why you're asking me these questions. Other: I did not say I wouldn't consider housing on or near the campus. Other: I DO live by the U, but would not move. The survey does not include that option. Other: I have a historic house that I do not want to leave or sell. Other: I have lived next to college-aged students, and they can be inconsiderate neighbors. Other: I have no plans to move Other: I live close enough right now. Other: I live in a campus neighborhood already. Other: I live in a different country.



Other: I live in the Como neighborhood near the U of M Other: I live in the U of M neighborhood Other: I live near the U of M campus, so this question does not apply to me. Other: I live near the U of M campus. Other: I now live in Florida where the weather is kinder Other: I personally currently do not work at or attend the U of M (my daughter does however) Other: I would consider the area if I were to think about moving. Other: I'm not a student and have no desire to live on or near campus Other: I've lived in a nearby UofM campus neighborhood for 20 years. I doubt my next move would be closer to campus. Other: just bought the house Other: Lack of city response to off campus drinking & so-called 'parties' Other: Living next to drunken or drugged students and their party houses is not my idea of a good retirement . Other: May need help for Alzheimer's care for mate. Other: Minneapolis property taxes are horrendous. Other: my daughter will be moving over to the U for off campus housing, she is in a dorm now. Other: My neighborhood IS next to the U of M campus & I prefer to stay in my own home. Other: No reason; we like the U's neighborhoods Other: Non owner occupants can undermine stability of neighborhoods Other: Parking Other: Plan to stay where I am for life. Other: Prefer children to complete their education through Eden Prairie School District #272 Other: prefer the suburbs--parking is simpler for one thing Other: Prefer to live close to work in a suburban or semi-rural neighborhood. Other: retired. No interest or need to live close to campus Other: students are bad neighbors Other: the U;s constant exansion and crime Other: This question does not apply as we live near the University. Other: Tired of living in neighborhood where rental property has replaced families. Other: too much crime Other: U job is not secure Other: Want to be closer to work Other: We already live here. Other: we are in our 80'2,own our home, do not wish to move anywhere Other: We currently live only about a mile from the campus so will probably not move closer. Other: We like our house and we have no plans to move. We live very near the U already. Other: We live 3/4 of a mile from the U and I walk to work. This is a poorly designed survey to not take that into account Other: we need a large garden Other: WE'RE ALREADY HERE Other: Yes, I would consider housing next to the U of M campus. Other: Your questions are all tangential or irrelevant, since I already live within a block of the campus



15. To what style of housing would you prefer to move? (Select all that apply)

To a single-family home 32 19%To a twin home or duplex 22 13%To a townhome 64 37%To a condominium 66 39%To an apartment 37 22%In with relatives or friends 2 1%To a retirement/senior independent living community with no services 29 17%

To a retirement community (age 55+) 60 35%Do not know 14 8%Am not interested in moving 1 1%Other 8 5%Total Responses 335

Comments: Other: cooperative Other: I already live in a townhouse near the U of MN Other: loft Other: mixed occupancy Other: NA already here



Other: near riding facility at the St. Paul Campus Other: We live a cross the street from the West Bank campus now, so if we moved it would be within walking distance of the U. Other: would like to be able to grill outside - and have a garden

16. What type (size) of dwelling would you prefer? Studio 1 1%Small one-bedroom 7 4%Large one-bedroom 7 4%Small two-bedroom 26 15%Large two-bedroom 31 18%Two-bedroom with den 59 34%Larger size unit 8 5%Unit size preference depends on community features and amenities 29 17%

Other 6 3%Total Responses 174

Comments: Other: We would like a large space with a studio for art and photography if one is affordable.



Other: one bedroom, libary which could be an alcove in bedroom, 2 bath Other: NA already here Other: loft type with office space Other: 4 bedroom home Other: 2 bedrms, living space needs to be open,, must allow pets

17. What could the U of M offer that would attract you to housing near to or on the Minneapolis campus? (Select all that apply) Recreational center 87 50%Regular cultural events and activities 137 78%Sports events (spectator) 66 38%Sports events (participant) 18 10%Volunteer opportunities 76 43%Employment opportunities 56 32%Educational opportunities 120 69%Convenient access to entertainment and shopping options 107 61%Transportation (van, bus or carpool) 100 57%Convenient access to health care services (on-site or nearby) 109 62%

There are no features that would attract me to housing on or near the U of M 0 0%

Other 13 7%Total Responses 889



Comments: Other: Discount travel opportunities. Other: grocery, movie theater, coffee shops etc Other: home care Other: I already live near campus for many of the above reasons + its close to downtown,easy access to St paul and highways to the north and our cotttage Other: I wouldn't consider the U of M area until I'm much older; next move is the country Other: library & faculty Other: More control of off-campus housing and some student behavior (code of conduct) Other: off-street parking Other: Pro-active policing of the inebriated partyers who own the streets Thurs, Fri and Sat nights - Sun Other: Public transportation (LRT) Other: riding activities - golf course pass and view - st. paul campus Other: Urban forestry and greening Other: We love living here now and take advantage of the above amenities.



18. What would be the most important considerations in deciding on a residence that was located near to or on the U of M Minneapolis campus? (Select all that apply)

Social and cultural opportunities 113 64%Convenient access to recreational features 54 31%Convenient to campus events and activities 94 53%Convenient to work 55 31%Location near Downtown Minneapolis 83 47%Convenient access to nearby shopping 83 47%Don't have to use my vehicle as often 105 60%Could reduce number of vehicles in our household 38 22%Pedestrian-friendly 97 55%Ability to have pets 66 38%Have family/relatives attending the U of M 8 5%Need housing accessible for increasing disabilities 22 13%None of the above 1 1%Other 15 9%Total Responses 834



Comments: Other: Availability of a senior living community Other: Availability of community AND personal gardening space. Other: Beauty of neighborhood and house--both inside and out/garden Other: Cost Other: design of unit Other: Do not want to live with students Other: I am most worried about affordability in the future after I retire. Other: Love the Mississippi gorge Other: Nice condo/townhome/residence for over 55 at reasonable price and proximity to the U of M would be a plus Other: off-street parking Other: Pro-active policing of the partyers who own the streets Thurs, Fri and Sat nights Other: Reasonable cost.. Other: safe neighborhood Other: Urban forestry and greening Other: We currently live in the Prospect Park neighborhood.

19. What common area building features and services would you want offered at a

residential community on or near the U of M Minneapolis campus? (Select all that apply)

High-speed Internet/Wi-Fi 155 89%Exercise facility 124 71%Exercise pool (leisure/lap pool) 60 34%Overnight guest suite 75 43%Rooftop terrace 57 33%Backyard 60 34%Community garden 91 52%Billiards/game room 14 8%Theatre room/big screen T.V. 21 12%Spa/massage 20 11%Guest parking 129 74%Transportation services 94 54%Security guard 60 34%Multipurpose room 52 30%None - Prefer stand-alone housing 9 5%Other 11 6%Total Responses 1,032



Comments: Other: a library/meeting room Other: Access to LRT Other: chapel Other: In case we need it, handicap accessible and affordable. Other: No loud/partying students Other: off-street parking Other: Outdoor private space - patio or deck Other: party suite with kitchen - library Other: private deck Other: reduced noise - less late night shouting Other: Some very nice over 55 housing complexes have heated underground parking, and a kitchen in the multipurpose room, which are nice features



20. What services and amenities would you want offered in the neighborhood on or near the U of M Minneapolis campus? (Select all that apply)

Access to recreation and biking/walking trails 145 83%Restaurant or cafe dining 148 85%Bookstore and other local shopping 125 71%Spa/massage 22 13%Retail shops/restaurants within walking distance 139 79%Open space and Parks 133 76%Public transportation access (i.e. light-rail, bus, etc.) 143 82%Parking 112 64%Health Clinic or hospital 93 53%Other 7 4%Total Responses 1,067

Comments: Other: coffee house Other: environmentally sustainable construction / utilities /maintenance Other: Grocery store within walking distance Other: I like having a larger grocery and larger hardware store in the neighborhood. Other: natural foods co-op



Other: Studio space Other: trees and greenery

21. I/we would prefer to:

Own 75 43%Rent 21 12%Undecided/don't know 79 45%Total Responses 175



22. How likely would you be to place an advance reservation deposit? Very unlikely 11 6%Unlikely 37 21%Neutral 50 29%Likely 16 9%Very likely 4 2%Don't know (depends) 56 32%Total Responses 174



23. If you were to purchase a unit/home near or on the U of M Minneapolis campus, how much are you willing to pay?

Less than $150,000 16 9%$150,000 to $199,999 45 26%$200,000 to $299,999 56 32%$300,000 to $399,999 26 15%$400,000 to $499,999 6 3%$500,000 or more 4 2%Do not plan to purchase 20 12%Total Responses 173



24. If you were to rent a unit/home on or near the U of M Minneapolis campus, how much would you be willing to pay monthly?

Less than $750 9 5%$750 to $999 36 21%$1,000 to $1,499 42 25%$1,500 to $1,999 22 13%$2,000 to $2,499 8 5%$2,500 or more 1 1%Do not plan to rent 52 31%Total Responses 170



25. How do you view your potential support for an age-restricted (55+) housing community on or near the U of M campus? (Select all that apply)

Moving in (purchase or rent) 101 61%Referring friends and family 64 39%Spreading the word 71 43%Volunteer work 29 17%Financial contribution 5 3%Would not support 25 15%Other 18 11%Total Responses 313

Comments: Other: don't know Other: Good idea! Other: I love living in Riverside Plaza with the ethnic mix and people of all ages. Other: I would support age-restricted housing. I don't get the connection between you question and the answers. Other: Keep Informed Other: Let's see the plan. Other: neutral Other: neutral Other: not positive on age-restricted housing



Other: not sure Other: prefer St Paul to Mpls Other: Presbyterian homes and Services support Other: uncertain - vary with concept Other: uncertain what you are asking. Other: Would consider purchasing after an evaluation of similar complexes, with this community having the distinct advantage to the U, which I have always enjoyed. Other: would encourage the age limit lowered to 45+

26. How many people are currently living in your household on a regular basis?

1 107 24%2 232 53%3 52 12%4 or more 49 11%Total Responses 440



27. Approximately what percentage (%) of your before-tax income (i.e. GROSS income) is spent on housing including mortgage payment or rent, utilities, taxes and insurance?

Less than 30% 305 71%30% to 40% 90 21%41% to 50% 24 6%Over 50% 9 2%Total Responses 428

ACRONYMS AND DEFINITIONS


APPENDIX - Acronyms and Definitions Active adult ownership – Refers to age-restricted (55+) for-sale housing developments. Most commonly, these types of projects are senior cooperatives or condominiums; however they could also include one-level living villas, manufactured homes or other for-sale concepts that are age-restricted to older adult and senior households. Activities of Daily Living “ADL” – These activities are considered to be an everyday part of normal life and may include personal care, dressing, bathing, toileting, cooking, eating, etc. Adjusted Gross Income “AGI” – Income from taxable sources (including wages, interest, capi-tal gains, income from retirement accounts, etc.) adjusted to account for specific deductions (i.e. contributions to retirement accounts, unreimbursed business and medical expenses, alimony, etc.) Affordable housing – Housing that is income-restricted to households earning at or below 80% AMI, though individual properties can have income-restrictions set at 40%, 50%, 60% or 80% AMI. Rent is not based on income but instead is a contract amount that is affordable to house-holds within the specific income restriction segment. Also referred to as very low-income (under 50% AMI) and low-income (50% to 80% AMI) housing. The term affordable housing is not a general term or reference used to describe the price of hous-ing in the University District. Area Median Income “AMI” – AMI is the midpoint in the income distribution within a specific geographic area. Be definition, 50% of households earn less than the median income and 50% earn more. The U.S. Department of Housing and Urban Development (HUD) calculates AMI annually and adjustments are made for family size. Fair market rent - The amount needed to pay gross monthly rent at modest rental housing in a given area. This figure is used as a basis for determining the payment standard amount used to calculate the maximum monthly subsidy for families on at financially assisted housing. The fol-lowing are fair market rents in Minneapolis as defined by the Minnesota Housing Finance Agen-cy (MHFA):

EFF 1BR 2BR 3BR 4BR

Fair Market Rent $646 $761 $924 $1,210 $1,359Note: Fiscal Year 2011 for existing properties

Fair Market Rent

Household – All persons who occupy a housing unit, including occupants of a single family, one person living alone, two or more families living together, or any other group of related or unre-lated persons who share living arrangements.



Income-qualifications – Incomes required by households in order to qualify for various housing products. The following are income qualifications by income level for residents of Hennepin County as defined by the Minnesota Housing Finance Agency (MHFA):

1 pph 2 phh 3 phh 4 phh 5 phh 6 phh 7 phh 8 phh

30% of median $17,640 $20,160 $22,680 $25,200 $27,240 $29,250 $31,260 $33,27050% of median $29,400 $33,600 $37,800 $42,000 $45,400 $48,750 $52,100 $55,45060% of median $35,280 $40,320 $45,360 $50,400 $54,480 $58,500 $62,520 $66,540

Note: Projects placed in service after 5/14/2010

Income Limits by Household Size

Market rate rental housing – Housing that does not have any income-restrictions. Some prop-erties will have income guidelines, which are minimum annual incomes required in order to re-side at the property. Maximum gross rent – The maximum gross rent that affordable housing properties are able to charge based on income-restrictions. The following are maximum gross rents by income level for properties in Hennepin County as defined by the Minnesota Housing Finance Agency (MHFA):

EFF 1BR 2BR 3BR 4BR 5BR 6BR

30% of median $441 $472 $567 $655 $730 $806 $88250% of median $735 $787 $945 $1,092 $1,218 $1,344 $1,47060% of median $882 $945 $1,134 $1,311 $1,462 $1,613 $1,764

Note: Projects placed in service after 5/14/2010

Maximum Gross Rent

Net Worth - Net worth is the difference between assets and liabilities, or the total value of assets after debt is subtracted.



Total Under 25 25-34 35-44 45-54 55-64 65 -74 75+

Less than $15,000 9,663 4,392 2,997 931 572 333 248 190$15,000 to $34,999 936 69 317 176 213 97 26 39$35,000 to $49,999 265 21 66 46 66 44 6 16$50,000 to $99,999 701 16 113 126 219 87 91 48$100,000 to $149,999 309 3 43 43 97 59 33 31$150,000 to $249,999 363 6 38 48 102 73 38 58$250,000 to $499,999 448 4 35 43 104 144 64 53$500,000+ 732 0 20 37 152 278 109 137 Total 13,417 4,511 3,628 1,451 1,525 1,115 614 573

Median Net Worth $10,414 $7,704 $9,081 $11,685 $31,640 $96,560 $60,264 $88,842Average Net Worth $131,616 $8,852 $25,630 $72,746 $241,564 $616,019 $472,427 $482,851

7-County MetroMedian Net Worth $141,186 $10,077 $35,727 $130,114 $230,198 $308,681 $270,705 $168,250Average Net Worth $481,432 $29,457 $117,711 $280,376 $602,951 $919,295 $863,104 $508,298

Twin Cities CBSAMedian Net Worth $141,234 $10,232 $40,927 $131,009 $227,513 $303,573 $262,674 $163,560Average Net Worth $469,162 $29,029 $116,799 $274,234 $590,945 $904,484 $840,768 $497,235


Data Note: Net Worth is total household wealth minus debt, secured and unsecured. Net worth includes home equity, equity in pension plans, net equity in vehicles, IRAs and Keogh accounts, business equity, interest-earning assets and mutual fund shares, stocks, etc. Examples of secured debt include home mortgages and vehicle loans; examples of unsecured debt include credit card debt, certain bank loans, and other outstanding bills. Forecasts of net worth are based on the Survey of Consumer Finances, Federal Reserve Board. Detail may not sum to totals due to rounding.

2010

Age of Householder

2010

NET WORTH BY AGE OF HOUSEHOLDERUNIVERSITY DISTRICT(Number of Households)

Senior Housing – The term “senior housing” refers to any housing development that is restricted to people age 55 or older. Today, senior housing includes an entire spectrum of housing alterna-tives, which occasionally overlap, thus making the differences somewhat ambiguous. However, the level of support services offered best distinguishes them. Maxfield Research Inc. classifies senior housing projects into four categories based on the level of support services offered as illu-strated in the graph:



Fully Independent

Senior Housing ProductsSource: Maxfield Research Inc.

CONTINUUM OF HOUSING AND SERVICES FOR SENIORS

Single-Family Home

Townhome or Apartment

Congregate Apartments w/ Optional Services Assisted Living Nursing

Facilities

Lifestyle Dependent on Care

Age-Restricted Independent Apartments, Townhomes, Condominiums, or

Cooperatives

Congregate Apartments w/ Intensive Services

Memory Care Units

Fully or Highly

Student Housing – Includes both on- and off-campus housing targeting university students. For purposes of this analysis, off-campus student housing is defined as rental properties in the Uni-versity District that are occupied exclusively by students. Subsidized housing – Housing that is income-restricted to households earning at or below 30% AMI. Rent is generally based on income, with the household contributing 30% of their adjusted gross income toward rent. Also referred to as extremely low income housing. Tenure – Tenure is a key variable that analyzes the propensity for householders to rent or own their housing unit. Tenure is an integral statistic used by numerous governmental agencies and private sector industries to assess neighborhood stability. Tenure by Age of Household Moved Into Unit

Age of HHDOwner Moved Pct. Renter Moved Pct. Total Moved Pct.HHD'S 1995-2000 Moved HHD'S 1995-2000 Moved HHD'S 1995-2000 Moved

15 to 24 130 121 93.1% 4,058 4,042 99.6% 4,188 4,163 99.4%25 to 34 353 287 81.3% 2,808 2,597 92.5% 3,161 2,884 91.2%35 to 44 527 218 41.4% 1,131 821 72.6% 1,658 1,039 62.7%45 to 54 582 102 17.5% 686 420 61.2% 1,268 522 41.2%55 to 64 312 34 10.9% 413 228 55.2% 725 262 36.1%65 to 74 312 31 9.9% 270 141 52.2% 582 172 29.6%75+ 130 6 4.6% 305 100 32.8% 435 106 24.4%Total 2,346 799 34.1% 9,671 8,349 86.3% 12,017 9,148 76.1%

Source: U.S. Census, Maxfield Research Inc.

Note: Due to a census tract boundaries, the University District boundary in the Prospect Park neighborhood is slighly larger than the defined University District geography has illustrated in the Demographic Analysis section of this report.

TOTAL HHDS'S

TABLE E1TENURE BY AGE OF HOUSEHOLDER MOVED INTO UNIT

2000 CENSUS (MOVED FROM 1995 TO 2000)

Owner HHD's Renter HHD's

UNIVERSITY DISTRICT



Tenure by HHD Moved(Moved between 1995 & 2000)

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%

15 to 24

25 to 34

35 to 44

45 to 54

55 to 64

65 to 74

75+

Age

of H

HD

Pct. Moved

Renter HHD'SOwner HHD'S

Tenure by Age of Household Moved Into Unit

Proportion ProportionNo. Pct. No. Pct. Own Rent

143 4.0 3,475 96.0 6.2% 39.5%167 8.4 1,810 91.6 7.3% 20.6%283 19.1 1,197 80.9 12.3% 13.6%304 21.7 1,098 78.3 13.2% 12.5%566 40.5 830 59.5 24.6% 9.4%232 47.7 254 52.3 10.1% 2.9%386 77.0 115 23.0 16.8% 1.3%217 93.1 16 6.9 9.4% 0.2%

2,298 20.7 8,795 79.3 100.0% 100.0%

TENURE BY HOUSEHOLD INCOMEUNIVERSITY DISTRICT

Own Rent2000



Tenure by Household Income - University District 2000

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Less than$15,000

$15,000 to$24,999

$25,000 to$34,999

$35,000 to$49,999

$50,000 to$74,999

$75,000 to$99,999

$100,000to

$150,000

$150,000+

HHD Income

Hou

seho

lds

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

Pct.

OwnRentProportion OwnProportion Rent

University District – Composed of the following four neighborhoods: Cedar-Riverside, Como, Marcy Holmes, and Prospect Park. Generally bound by Central Avenue NE to the west, Henne-pin Avenue East to the north, the Minneapolis municipal border to the east, and Interstate 94 and the Mississippi River to the south. (see map on the following page) Workforce housing – Housing that is income-restricted to households earning between 80% and 120% AMI. Also referred to as moderate-income housing.



Year-End 2010 Rental and For-Sale Data East Minneapolis - Avg. Rents/Vacancies

4Q 2010

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Studio 1BR 1BR/D 2BR 2BR/D 3BRUnit Type

Ren

ts

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

Vac

ancy

Rat

e

Rent Vacancy Rate

City of Minneapolis - Avg. Rents/Vacancies4Q 2010

$0

$500

$1,000

$1,500

$2,000

$2,500

Studio 1BR 1BR/D 2BR 2BR/D 3BRUnit Type

Ren

ts

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

Vac

ancy

Rat

e

Rent Vacancy Rate



Median Average Avg. DaysNumber Selling Selling on Market

Neighborhood of Sales Price Price (DOM)

Cedar-Riverside 10 $111,950 $116,890 65Como 34 $170,250 $172,252 64Marcy Holmes 38 $438,750 $439,199 40Prospect Park 36 $220,000 $259,380 77University District Total 118 $266,953 $280,108 60

Sources: Regional Multiple Listing Service of Minnesota (MLS) Maxfield Research Inc.

SINGLE-FAMILY AND MULTI-FAMILY RESIDENTIAL SALESUNIVERSITY DISTRICT

2010

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