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DOWNTOWN CLEARWATER MARKET STUDY/PROPOSAL #11-05 - FEBRUARY 28, 2005 . I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ,. I. . . . . . . I. . ((t:~~ert Advisory 260 I South Bayshore Drive, Suite 300 B Miami, Florida 33 133 USA ph 305 860 3715 fx 305 860 3777 www.lambertadvisory.com Mr. George McKibben City of Clearwater 100 S. Myrtle Avenue Clearwater, Florida 33756 February 28, 2005 Subject: Downtown Clearwater Market Study Dear Mr. McKibben: Lambert Advisory, in conjunction with PRG Real Estate Research, is pleased to submit this proposal to support the City of Clearwater/Community Redevelopment Agency (CRA) with a Market Study for Downtown Clearwater. We are well aware that the market study for Downtown Clearwater is only a portion of the more comprehensive economic development effort that has long been underway. During the past several years, the City (through its CRA) has been involved in creating a comprehensive, multi- disciplinary redevelopment plan. These efforts have included transportation and infrastructure improvement, mobility initiatives, Brownfield programs, business development (through investment funding programs), cultural enhancement, workforce development, housing, and quality of life issues. Much of this is clearly laid out in the Downtown Clearwater Re- Development Plan prepared and recently updated by the planning department. Accordingly, there are a myriad of specific capital improvement and development initiatives currently in progress (or planned) for Downtown. With an understanding of the initiatives already set forth in Downtown Clearwater, perhaps an element that is unique to the redevelopment effort is the fact that the City controls a considerable portion of land in the area. With control of several strategic sites, the City is in a strong position to guide both a short-term and long-term redevelopment strategy. Given the City's unique position (as lack of site control is oftentimes one of the greatest obstacles to community redevelopment), we believe that the Market Study should be centered around providing guidance to the City/CRA, and community, not only in helping define what retail/entertainment, office and/or residential opportunities there are for Downtown, but how these opportunities can be translated into reality and engender support from all stakeholders. This is best accomplished when the market, real estate, and economic development issues serve as the guiding issues. This is not to suggest that the physical design and land use regulatory elements of the plan are secondary. In fact, the market study may help to further define some of the urban planning and design initiatives that support a redevelopment plan. During the past several years, Lambert Advisory has created a niche in downtown redevelopment analyses. Presently, Lambert Advisory serves as an economic, market, and/or financial advisor to CRAs and downtown initiatives, including: The City of Miami (CRA and Downtown Development Authority); . . . . . . . . . . . . . . . I. . I. I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Page 2 The City of Fort Lauderdale (CRA and Downtown Development Authority); City of Tampa (Housing Authority); The City of Jacksonville (Economic Development Commission); and, City of Plantation CRA. While the contract is pending, Lambert Advisory (in conjunction with URS Corporation), was recently selected as the economic/market consultant for a redevelopment study of the Drew Park area, a designated CRA in Tampa's Westside. Given our current involvement in Downtown Tampa, as well as our State and national experience in downtown development, revitalization, and more general funding strategies for real estate and economic development, we feel we bring a highly valuable set of ski\ls and experience to provide the City/CRA with a market study and implementation strategy for Downtown Clearwater. To provide us with additional local market support, we have teamed with PRG Real Estate Research, a Tampa Bay-based consultant who has completed a number of economic and market research analyses within the City of Clearwater and/or surrounding region. From our perspective, the success of a redevelopment effort is largely associated with the support garnered from the community. It is also important to clarify how redevelopment of the area wi\l be of benefit to the broader community (e.g., areas outside of the downtown core). Therefore, in order to help the City/CRA with this endeavor, the Market Study has two specific goals: 1.) conduct substantial market research, including interviews with key stakeholders, to clearly understand supply and demand conditions among various real estate uses; and 2,) use the market research and analysis as the basis for identifying and supporting realistic short-term and long- term redevelopment strategies for which the City/CRA will playa significant role. We are excited about the opportunity to further discuss our experience and qualifications with the City of Clearwater as it relates to our ability to provide a Market Study that supports the successful redevelopment of Downtown Clearwater. Sincerely, E~ Principal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .' . . . . . . . . . . . Table of Contents City of Clearwater RFP# 11-05: Downtown Clearwater Market Study A. Letter of Transmittal B. Proiect Understanding/Project Approach B,l Our Understanding of the Market Study 1 B.2 Methodology (Scope of Services) 2 B.2a Start-up/Kick-off 2 B.2b Economic and Market Analysis 3 B,2c Marketing Initiatives 5 B,2d Redevelopment Opportunities/Preliminary 5 Programs B.2e Downtown Market Study 7 B.3 Downtown Market Study Expertise and Qualification 7 B.4 Project Schedule/Timeline 7 B.5 Quality Assurance 8 C. Company Profile and Qualifications C.1 Lambert Advisory - Company Profile 9 C.2. Lambert Advisory Qualifications 11 C.3 PRG Real Estate Research Qualifications 16 D. StaffinQ Organization Chart 19 Staffing 20 Paul Lambert 20 Eric Liff 21 Adrienne Brown 22 Frank Pallini, PRG Real Estate Research 23 E. References 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 B. PROJECT UNDERSTANDING/PROJECT APPROACH B.1 Our Understandina of the Market Study For the past several years, Lambert Advisory has participated in various planning, economic, and strategic initiatives related specifically to downtown redevelopment efforts. We have acted as market and/or financial advisor to Downtown Development Authorities (DDAs), Community Redevelopment Agencies (CRAs), and other agencies in cities across Florida, including Tampa, Fort Lauderdale, Miami, Jacksonville, and Plantation. To provide us with additional local support and knowledge, we have teamed with PRG Real Estate Research, a Tampa Bay area consulting firm who has conducted numerous comprehensive economic, demographic, and real estate market research studies within the City of Clearwater and the surrounding region. We are well aware that the market study for Downtown Clearwater is only a portion of the more comprehensive economic development effort that has long been underway. During the past several years, the City (through its CRA) has been involved in creating a comprehensive, multi-disciplinary redevelopment plan. These efforts have included transportation and infrastructure improvement, mobility initiatives, Brownfield programs, business development (through investment funding programs), cultural enhancement, workforce development, housing, and quality of life issues. Much of this is clearly laid out in the Downtown Clearwater Redevelopment Plan prepared by the planning department (and updated in January 2005), or documented within the RFP itself. We understand there are specific plans that are recently completed, in process. or planned that will impact Downtown Clearwater, including: Y Memorial Causeway Bridge, which will serve as a crucial link between the beaches and downtown, and inevitably mitigate traffic; Y Residential development plans proposed by several developers, estimated to represents more than 700 units (planned or under review); and Y Osceola Avenue Bluff parcels, which represent a major strategic land mass over which the City has considerable control. Therefore, with a great deal of work already in process, the market study will help provide additional economic and strategic development support for realistic redevelopment programs in Downtown Clearwater. The City's need for Downtown Market Study that is comprehensive and effective requires a combination of experience in site redevelopment, 1 . - .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 downtown and neighborhood revitalization, business expansion, economic impact analysis, highest and best use of vacant land, and a keen sense of how to integrate economic development with urban planning. Finally, an understanding of both market rate and affordable housing will be important, to ensure that the Downtown redevelopment initiative is a long-term sustainable plan. We believe that the expectations for this analysis may be summed up in a number of key questions: V What are the notable public and private sector initiatives (including recently completed and current development plans, community initiatives) in the area that will impact Downtown? V How do we assimilate and prioritize all of the public and private sector initiatives so that future efforts effectively capitalize on the groundwork that is already being placed? ..; Where are the strategic nodes/sites that may be critical short-term (1 to 5 year) opportunities? Which sites are better positioned for the long-term planning perspective? Importantly, who controls these sites and how does control impact the planning process? V What level of investment will be required by the public sector and how is this public investment best leveraged through private market participation? V How does the existing regulatory environment fit into the prospective vision and how extensive will the modifications be to accommodate desired zoning and design guidelines? V How will the redevelopment of Downtown Clearwater impact the City (and surrounding region) both economically (tangible) and socially (intangible)? B.2 Methodoloav (ScoDe of Services) The scope of work outlined below highlights the primary steps in completing the Downtown Clearwater Market Study. B.2a Start-up/Kick-Off The project will commence under the direction of the City of Clearwater/CRA, whereby Client and Consultant members will ultimately define the work plan. We envision a comprehensive area and site tour as well as introductory meetings with appropriate City officials and staff, and other community 2 . - - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 stakeholders and leaders that may have a positive impact on the overall plan. In addition, we will take this time to gather and review existing economic and demographic reports and statistics, planning studies, existing condition assessments, building and business inventory reports, and/or market profiles and surveys provided by the City. B.2b Economic and Market Analysis We will analyze pertinent economic, demographic, and market factors that impact land use, business expansion, and space utilization within the Downtown area which could contribute to the overall redevelopment planning process. This analysis will focus on key economic and real estate issues such as market demand and supply conditions and includes a trade area analysis of retail/entertainment, office, and residential demand. The goal is to provide a comprehensive understanding of market conditions in downtown Clearwater, as well as surrounding neighborhoods. Specifically, we will identify those local/regional trends that a redevelopment plan may leverage to encourage investment locally. Accordingly, we will organize and analyze the research in an effort to identify the highest and best use for development of key sites within downtown that may be key catalyst for short-term opportunities. The information and data collection will be based upon both primary field research and secondary sources such as published data from government, non-profit, and private industry sources as well as additional data and information provided by the City. Demand Conditions Our analysis of demand conditions will include detailed economic and demographic trend and forecast analysis, as well as an overview of key industries and cluster identification based upon a very detailed analysis of Florida ES-202 statistical reports at the three and four digit classification levels for' the past five years. The analysis will detail: - Population and population characteristic trends and projections, specifically focusing upon age cohorts; - Employment trends and labor force characteristics; Conduct direct interviews with some of the area's major employers and business development groups to further understand the area's propensity for employment growth; - Analyze household trends and develop projections; - Office employment trends in surrounding areas and employee daily expenditure patterns; 3 ... WI' - - . ... ,., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 - Visitor growth trends and profile and expenditure patterns; - Define downtown's Trade Area, with estimates of drive times pre- and post capital improvements; - analyze expenditure patterns by retail good; and, - Traffic patterns and trends along the major thoroughfares. Supply Conditions The supply conditions analysis includes an overview of existing conditions for the primary real estate uses and business clusters that will potential growth, including: retail/entertainment, housing (for sale and rental), and office. Based upon primary field research conducted through surveys and interviews, we will provide a competitive and comparative analysis of existing and proposed projects by real estate use, to identify: - Size of retail and/or entertainment center, office building, and residential project; - Major tenants in the case of commercial space; - Age and condition of development; - Sales/Rental and occupancy rates in comparable/competitive housing; - Sales per square foot in retail space; - Mix of tenants, customer profile and amenities; - Distance of competitive projects from the core redevelopment area; - Current zoning criteria, its relation to current land uses, and its influence in the level of success of existing businesses; and, - Other pertinent information including an overview of planned projects considered to impact the redevelopment plan. It is important to stress that our desktop research conducted for this analysis will be supported by a strong field-based effort. Only after matching our desktop analysis with fieldwork will we understand the direction of the market for each particular use and specific geographic areas. Lambert Advisory Retail Trade Model Specific to retain/entertainment opportunities in downtown Clearwater, we will develop a detailed retail trade model which estimates the total demand for retail space by category for the area on a five to ten year projection basis. The model will estimate net new demand from local residents, workers, and visitors and will compare this to the existing competitive retail stock in the area. Driving the model is a significant amount of fieldwork to determine the current mix of retail in the area and how competitive retail will impact any proposed development. 4 -. ... City of Clearwater Downtown Clearwater Market Study February 28/ 2005 - - - a - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Market Conclusions Based upon the findings from the supply and demand analysis and general understanding of the community and its residents, we will be able to clearly understand how to focus retail and office business expansion as well as housing development. As part of our market conclusions we will begin to assess what sites or nodes within the downtown area could contribute to the overall value of a redevelopment plan. Importantly, we will create a general phasing plan for the downtown area to broadly define where prospective investment (both public and/or private) should be targeted to meet underlying market trends. B.2c Marketing Initiatives As part of our economic and market analysis, we will identify opportunities related to special events and promotions for Downtown Clearwater. This marketing effort is considered to serve two rolls: 1.) identify events and related activities that will directly support existing businesses and stakeholders; and, 2.) consider promotional activities that will heighten the awareness of Downtown Clearwater's future vision and planning effort. To assess the most effective event and marketing programs for downtown Clearwater, we will benchmark other downtown communities that we have worked with, and/or other communities, to provide the City with a general profile of potential of space needs, target audience, funding/cost parameters, and other related characteristics that related to effective events and promotions. B.2d Redevelopment Opportunities/Preliminary Programs Based upon the collection and analysis of information from the economic and market evaluation, we will develop a detailed strategy of potential short-term (1 to 5 years) redevelopment opportunities for Downtown Clearwater. The strategy will recognize the goal of capitalizing on development opportunities including' mixed-use development programs. Notably, an important component to the success of a long-term vision for Downtown Clearwater is housing development, both market rate and affordable. In terms of identifying strategic sites that should be targeted for short-term and long-term development redevelopment, including those locations that the City/CRA has noted, as well as other potential properties, the market study will help answer critical questions, including: => What is the highest and best use of the prospective site(s)? Outside of a direct property valuation, is there a viable strategic program that both 5 - . -- - . - . .. - ... - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 maximizes the site's value, as well as creating value and incentive for investment within the surrounding area? How could other surrounding properties, if owned or controlled by the City (or other public agency), add value to the overall development program? => What liabilities need to be addressed before certain redevelopment programs can be employed and how does the City address those liabilities? What liabilities exist which must be addressed before redevelopment can actually occur? What is the strategy for addressing these liabilities? => What type of entity should be the principal developer of the Property? The goal is to optimize the redevelopment plan through a developer primarily familiar with housing, commercial or mixed use development. As the program(s) for redeveloping downtown sites emerges, the opportunity to link the redevelopment options to physical planning options may be addressed. To this extent, we will be able to provide comprehensive insight into issues such as: => How do we continue to strengthen Downtown Clearwater's identity? Upon evaluation of certain architectural and design attributes within each area, we may provide recommendations as to how to make use of existing features to market the program. => How do we effectively integrate various sites with their surrounding Land Uses? The success of a community often times depends on an adequate mix of land uses. We will help to identify (through Aerial photography and maps) strengths and weaknesses in the existing mix of surrounding uses and its corresponding impact on the redevelopment opportunity. => Is there an opportunity to improve pedestrian mobility and create sense of place? An inventory and relationship analysis of existing access routes, public transportation, landscape features, and activity centers may be conducted in order to understand how to better implement the necessary improvements. We feel strongly that an important part of the market study will be to focus intently on short-term opportunities (1 to 5 years). We will also prepare a long-term development vision for certain sites/areas that will most likely be integrated into the overall plan during the 5 to 10+ year timeframe. These opportunities will be evaluated in a similar manner as the prospective short- term programs; however, one focus will be on providing the City/CRA with a program to help property owner(s) and/or the public understand how important these particular sites will be to the long-term vision in hopes of 6 - .- - .-, -- - -- ~ -- - - City of Clearwater Downtown Clearwater Market Study February 28/ 2005 preempting any development that is not in the best interest of the community. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B.2e Downtown Market Study Based upon the economic and market findings, marketing and community outreach, redevelopment opportunities (short-term and long-term), the final step to the Market Study will be to prepare a final document that includes all research, analysis, and conclusions. Accordingly, the document will be completed in electronic format for presentation on the City of Clearwater web-site. B.3 Downtown Market Study EXDertise and Qualification As noted above, and for which we provide a detailed overview of specific work experience in Section C of this proposal, Lambert Advisory has completed more than 30 economic/market redevelopment studies during the past few years. Importantly, Lambert Advisory serves as an economic, market and/or financial advisor on more than ten downtown redevelopment initiatives in the State of Florida, with notable clients including: ~ City of Miami Downtown Development Authority (DDA); ~ City of Fort Lauderdale DDA; ~ The City of Tampa; and, ~ City of Jacksonville Economic Development Commission (JEDC). Accordingly, we have completed related economic/market studies among a diverse group of communities throughout the United States, including: ~ Manhattan Empowerment Zone; ~ City of New Orleans; ~ City of Norfolk; ~ Port Authority of Corpus Christi (TX); ~ City of Pawtucket (RI); and, ~ San Diego Port Authority. B.4 Proiect Schedule/Timeline We anticipate that the Downtown Clearwater Market Study will be completed within 60 days after a notice to proceed has been issued. Consdering this, we recommend an oral presentation of findings to the City/CRA within 4S days of project commencement. We will utilize the final is-day period to make any adjustments to the analysis based upon feedback within the oral presentation, and furthermore complete the Market Study report, which represents a document complete with all research, analysis and findings. 7 City of Clearwater Downtown Clearwater Market Study February 28/ 2005 B.5 Qualitv Assurance - - - - - .- .. .- .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Lambert Advisory is very proud of its quality assurance control, and we encourage the City to seek feedback from references confirming this policy. A unique element of this firm is the Principal's involvement and oversight in all aspects of the working process - from field research to findings and recommendations. 8 City of Clearwater Downtown Clearwater Market Study February 28/ 2005 C. COMPANY PROFILE AND QUALIFICATIONS C.1 Lambert Advisory - COmDany Profile - Since 1995, Lambert Advisory has built a diverse client base, providing real estate related advisory services throughout the world. Our clients - developers, portfolio owners/lenders, government agencies, multinational corporations, and not-for-profit organizations - seek and return to us for many reasons: the consistent quality and breadth of our knowledge, high level of senior staff involvement in our projects, fresh perspective, and ability to get all parties engaged and focused on the opportunities a specific project presents. Some firms specialize in feasibility research, development partner identification, asset management consulting or portfolio due diligence. Lambert Advisory operates with the conviction that these elements exist on a continuum, and that a holistic approach often is in the best interest of the customers we serve. - - ~ ... - .- ...- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . We look at a project with a wide lens, immersing ourselves in multiple aspects of a client's business and assembling a talented team of professionals with specific areas of expertise. Our team members are as often urban planners or designers as they are experts in deal structuring, capital formation and capital promotion. The members of our senior management team have diverse backgrounds, ranging from planning to development to finance to leasing and lending, but all have a common factor: real estate. By providing these integrated services with our internal and external resources, we are able to minimize the time in which a project is introduced to the market and preserve the original concepts that make it unique. Furthermore, in a time when capital and knowledge flow easily across borders, our global focus is a critical advantage to those who come to us for guidance on existing and future projects. Whether' bringing a development/finance partner or economic and market insight to a venture, we look far and wide to leverage our relationships and experience. Relevant Service Lines Market and Feasibilitv Analvsis A rigorous, independent feasibility analysis - one which ensures that development projects are optimally positioned - substantially reduces the risk for owners and investors. 9 City of Clearwater Downtown Clearwater Market Study February 28/ 2005 -. We provide more than an indication of achievable rents and absorption. Each of our studies includes in-depth perspectives on the marketplace and detailed design guidelines for architects and planners. - - In cases where plans already have been drawn up or projects built but require repositioning, we offer a constructive critique about how to make the project more marketable and manageable. - - - - - ..- - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Successful projects, whether single use or major mixed use programs, are responsive to fluid market conditions and financial requirements. Lambert Advisory is adept at bringing these elements together in a coherent guidebook for developers and owners. We position our clients to realize the maximum economic potential of a project. Economic Imoact Analvsis Increasingly, public entities are trying to determine the economic impact on their communities of the development and operation of large projects. Communities want to ensure that projects which require public approval, and in some cases, public participation, have a significant benefit to the economy. Impacts from developments are grouped into three primary categories: . Construction Impact · Operating Impact . Indirect Impacts Lambert Advisory has significant experience providing economic impact analysis services to public entities and corporations. Our particular expertise revolves around determining the extent of indirect impacts and how they can be leveraged to provide further momentum and growth. 10 City of Clearwater Downtown Clearwater Market Study February 28/ 2005 C.2 Lambert Advisory Qualifications .. Lambert Advisory has a wide range of experience in a number of the service areas needed to serve The City of Clearwater Community Redevelopment Agency in this engagement. Our recent experience includes downtown and mixed-use projects, community development (including work for CRAs), and economic impact analysis. Importantly, several engagements summarized herein have been completed in conjunction with PRG Real Estate Research (PRG) : - - - .. - - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Tampa Housing Authority Central Park Village - Development Plan and HOPE VI Application Lambert Advisory, in conjunction with PRG, recently completed a master development plan, market and financial analysis and HOPE VI Application for the Tampa Housing Authority's 28-acre (800+ unit) Central Park Village property. The redevelopment of Central Park Village is deemed a critical piece of the revitalization of a depressed, but geographically strategic area. Lambert was instrumental in providing the vision for a strategic plan based upon a comprehensive market analysis of rental and for-sale housing demand, as well as retail/commercial opportunities. Accordingly, Lambert oversaw the $20 million HOPE VI Application and detailed financial analysis for the project. Additionally, Lambert represented the THA in its negotiation with Civitas in an effort to broaden the revitalization plan through a joint- development partnership. Miami Downtown Development Authority Economic and Market Advisory Services, Downtown Master Plan Lambert currently serves as the Economic and Market Advisor to the Miami DDA for the Downtown Master Plan. This includes identification of and plan for strategic redevelopment opportunities, public outreach, and stakeholder/partnership opportunities. Also in this capacity, Lambert has assessed the market conditions for retail and office uses along Flagler Street in downtown Miami. The study area includes the Miami Jewelry District, the third largest jewelry district in the United States. Lambert has developed a database and visual representation of the occupancy status, merchandise category, square footage, and ownership of over 500 retail tenants. Lambert has also estimated demand for retail, by merchandise category, derived from the resident, office worker, and visitor markets served by the study area. These products will be used to formulate, in conjunction with the DDA Board and staff, a retail redevelopment and/or repositioning strategy. City of Miami/Miami Downtown Development Authority (DDA) Downtown Miami DRI Economic Analysis Lambert Advisory has served as the economic advisor on the City of Miami's DRI Application. The firm's analysis included a demand/development projection of space needs in the Downtown, Brickell and Omni areas by use including: office, retail, housing (for sale and renal) and hotel. The analysis 11 City of Clearwater Downtown Clearwater Market Study February 28/ 2005 also included a projection of downtown workers and their expenditure patterns. - - - - - - - - Miami Downtown Development Authority Demographic Advisory Lambert Advisory serves as the Miami DDA's demographic advisor, and oversees the collection of data related to visitors, workers, and residents. The work Lambert has completed includes over 1,500 interviews with hotel guests, downtown workers, and residents to determine the profile of each of the groups, expenditure patterns, and experience living working or visiting downtown Miami. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Fort Lauderdale Downtown Fort Lauderdale Master Plan As part of the City of Fort Lauderdale's downtown master plan, Lambert Advisory completed an analysis of demand projections by use (through 2010). The basis for the analysis considered historical and forecast economic, demographic and real estate market trends both locally and regionally that impact demand for specific uses in Downtown Fort Lauderdale, including: Office, Rental Housing, For-Sale Housing, Retail, and Hotel. City of Fort Lauderdale, Florida City Hall Redevelopment Analysis Lambert Advisory recently completed a market analysis related to a potential joint-redevelopment of City Hall. The analysis focused upon the opportunity to develop City Hall as a mixed-use project including office, residential and retail. Additionally, Lambert will assist in the strategic investment strategy (disposition of City-owned properties or public/private development) that may be needed to capitalize the project. City of Fort Lauderdale CRA - Palazzo Las Olas Market and Financial Analysis; Negotiation Representation The City of Fort Lauderdale hired Lambert Advisory to analyze and assist in negotiating the terms of a land lease between the City and the developer of two condominium buildings, a 1,400 space parking garage, and a 75,000 square foot retail center on one of the most prominent vacant sites in the City. The project was complicated by the fact that there is broad public controversy surrounding waterfront open space owned by the City, as well as the two hundred year no-cost land lease (and $3 million grant) the City was going to provide the developer of the project in return for the development of a 1,000 parking space garage. The project sits in the City's CRA district and will provide more than $1.0 million in tax increment each year, which the City intends to use to support the development of an international class 12 - City of Clearwater Downtown Clearwater Market Study February 28/ 2005 .- aquatic center that has as many supporters as the Palazzo project has detractors. .- - - - w ... ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Jacksonville Economic Development Corporation Urban Core Housing Plan Lambert Advisory is currently developing a housing strategy for Jacksonville's "urban core," which includes downtown Jacksonville and the city's enterprise/empowerment zone area. This project will include a detailed economic and demographic profile and residential real estate market analysis; it will culminate with a strategic plan, including recommendations for mixed-use and mixed-financing development on selected sites in the urban core. . - Upper Manhattan Empowerment Zone Feasibility Analysis and Business Development Lambert Advisory, in conjunction with Jones-Media Associates, serves as the economic and real estate advisor to the Upper Manhattan Empowerment Zone. The primary tasks included the feasibility analysis of key investment projects leveraging zone dollars, assistance in negotiations with developers and business owners, establishing parameters for use of zone monies, construction oversight consulting, and assistance in the prioritization of investments. Lambert Advisory also assisted the Zone in establishing a capital lending and revolving loan fund program for small area businesses including restaurants. The program capitalizes improvements and encourages reinvestment and growth among existing local businesses. The firm is working with private lenders to capitalize the fund with guarantees from the Empowerment Zone. Over $1.0 million in loan funds have been placed to date. City of New Orleans Tax Increment Financing Advisory Since 2002, Lambert Advisory has served as the City of New Orleans City Council's tax increment financing policy advisor. Lambert, in conjunction with PRG, initially evaluated the first tax increment proposal in the City and then developed case studies of the use of tax increment financing in other major cities throughout the United States in order to developed a criteria and policy for the approval of tax increment districts in the future in New Orleans. Lambert continues to advise and review for the Council specific proposals for the establishment of tax increment investments and districts throughout the City. City of North Miami, Florida Economic Redevelopment Strategy: Multi-Corridor Analysis Lambert Advisory is currently working with the City of North Miami on the economic development plan for downtown, as well as the major transportation corridors including West Dixie Highway, State Road 7, and Biscayne Boulevard. The scope of work encompasses market and cluster 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 identification analysis, community outreach/participation, strategic site redevelopment, financial analysis, and implementation. This includes an analysis of retail, residential, industrial hotel, and office development to identify market potential by real estate use (for each corridor), and create a plan that adequately promotes on-going investment within each area. City of Plantation Gateway 7 Corridor Development Strategy Analysis (TIF District) Lambert Advisory, with PRG as a subcontractor, was engaged in a market and financial assessment for the State Road 7 corridor, a designated CRA, in the City of Plantation. A key component to the analysis is aimed at guiding the City to the strongest redevelopment program from a "dollars and cents" perspective keeping in mind the broader goals of the City to effectuate the corridor's redevelopment, including housing development. Our objective was to test various cash flow scenarios including acquiring parcels and/or existing buildings and leasing them back to a third party for development. Based upon supply, demand, pricing, and capture analyses conducted in our in- depth market profile, we assessed financial feasibility and public funding requirements (if needed) on both an individual project basis and/or the redevelopment program as a whole. Pawtucket Redevelopment Agency Downtown Pawtucket Redevelopment Plan Lambert Advisory completed work with the City of Pawtucket to help develop a downtown redevelopment strategy. The downtown area, which has been economically depressed for the past several years, has been unable to capitalize on the renaissance occurring in neighboring Providence. Lambert Advisory identified economic opportunities specifically aimed at job creation which will provide support for public involvement in the downtown improvement initiative. Our effort includes direct interviews with major employers to understand perceived deficiencies and encourage renewed interest in devising a comprehensive plan. We identified an opportunity to capitalize on the expansion plans of one of the area's major medical facilities and growing demand for office space, creating the potential need for ancillary residential, retail and hospitality development and employment. C.ity of Miami Springs Miami Springs Downtown Revitalization Plan Lambert Advisory recently completed work with the City of Miami Springs to create a revitalization plan and implementation strategy for the downtown area. This includes the preparation of an in-depth economic analysis, real estate market assessment and consumer survey that identifies viable development opportunities needed to promote positive momentum for an area that has declined economically during the past several years. Accordingly, our findings outline the parameters for both short and long term planning and design programs that will be utilized by the City's planning consultants. 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28/ 2005 City of Miami Beach, Florida Electricwave Shuttle - Intermodal FaCility: Joint Development Analysis Lambert Advisory was engaged in the economic and market analysis, site selection, and joint development potential for the electricwave shuttle (bus) intermodal facility in South Beach. Based upon extensive economic and demographic research and analysis, we were responsible for evaluating specific sites for the intermodal facility and, furthermore, identifying the joint development potential for associated with each site. This included a retail, residential, hotel, and office development analysis to identify market potential by real estate use, and create a plan that adequately promotes on- going investment within the area. City of Hollywood, Florida Transit Intermodal Center: Joint Development Analysis Lambert Advisory is in the process of completing an analysis of the joint development potential associated with a rail, bus, and automobile intermodal facility at the intersection of Hollywood Blvd and Interstate 95. Based upon our in-depth economic and demographic market analysis, we were able to create a joint development program for the site that included retail, residential, hotel, and office development. The project, which has identified market potential, may serve as the catalyst for Hollywood to become one of the premier business centers in Broward County over the next decade. Queen Emma Foundation Waikiki 2010 Properties Market and Financial Advisor Lambert Advisory currently serves as the market and financial advisor to the Queen Emma Foundation in Honolulu, Hawaii developing an investment strategy for a number of hospitality, residential, and retail properties in the heart of Waikiki Beach which have long term ground leases due to expire in 2010. Lambert's work includes provide market research support to the redevelopment of the two acre plus International Marketplace which is owned by the Foundation and will be redeveloped as the newest urban retail center in Honolulu. The Queen Emma Foundation, a charitable trust set up for the promotion of health care services to people of native Hawaiian decent, is widely considered to be the second richest land owner in Hawaii. 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 C.3 PRG Real Estate Research Qualifications PRG has a strong track record in providing market demand analysis, needs assessment, and strategic planning for residential and commercial development, community redevelopment, and economic impact in markets in Florida and around the country. Following are descriptions of relevant engagements that have been successfully completed by PRG either as prime consultant or in joint venture as part of larger engagement team: Dunedin Condominium Market Evaluation Downtown Dunedin-Main Street PRG conducted an evaluation of market support for a mid-rise condominium development on the west end of Main Street in Downtown Dunedin, Florida. The project will serve as the first significant new residential development in downtown Dunedin and help facilitate the natural progression and evolution of downtown/Main Street Dunedin as a residential address to compliment this quaint and increasingly popular downtown "Main Street" venue of small shops and restaurants. The project will anchor the west end of "downtown" and provide an attractive and appealing transition between the expensive homes lining Victoria Drive and the shops and restaurants along Main Street. Hyatt Condo Hotel Beach-By-Design, Clearwater Beach, Florida PRG prepared an objective and independent evaluation of market support for the development of a new Hyatt condo-hotel on Clearwater Beach. The proposed development would consist of 250 condominium-hotel units as well as 18 residential condominiums on the top two floors of the hotel. The 18 condominium units would be sold as traditional - primary or secondary home- residential condominiums. PRG evaluated market support for the condo-hotel unit, including an assessment of location characteristics, target market, product parameters covering unit mix by type, size and price, unit design features and other general specifications, project amenities, sales and marketing program, estimated rate of absorption with pricing sensitivities, unit release schedule and related pricing strategies, and other recommendations. The Hyatt project will be the centerpiece of Beach Walk - a +2,700 feet pedestrian promenade that is part of the Beach by Design Redevelopment program planned by the City of Clearwater. Ventana Condominiums Market Evaluation Downtown Tampa-Channelside District PRG conducted a study to evaluate market support for a mid-rise luxury condominium development in the Channelside District of downtown Tampa. Channelside is an old warehouse district adjacent to downtown Tampa. The area is in the midst of a renaissance of new residential and commercial development. The Ventana condominiums perpetuate the renaissance with development of a high quality, high-end residential project that will anchor the eastern end of the district. PRG was responsible for conducting a 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 demand analysis covering unit mix by size and floor plan, unit pricing and pricing strategies, target market, sales and marketing strategies and estimated absorption. Plaza at Harbour Island High-Rise Condominium Market Evaluation Downtown Tampa, Florida PRG conducted a study to evaluate market support for a high-rise luxury condominium development in Harbour Island in downtown Tampa. PRG conducted a demand analysis covering unit mix by size and floor plan, unit pricing and pricing strategies, target market, sales and marketing strategies and estimated absorption Downtown Boynton Beach Commercial Demand Study, Boynton Beach Florida PRG was part of an engagement team that conducted a demand analysis and strategic planning for the commercial component of a mixed-use development planned for downtown Boynton Beach. The scope of work completed included a macro overview of existing and anticipated economic and market trends influencing the commercial retail market in the area. We reviewed and analyzed retail sales and expenditure potential in Palm Beach County and the Boynton Beach primary demand trade area. PRG determined market support/capture potential for various retail categories at the subject development from the on-site resident population, the Boynton Beach Primary Market Demand Area, and the visitor/tourist market. PRG prepared a development strategy for the commercial component addressing: principle sources of spending/demand by market segment, square feet of supportable retail by tenant type and size, tenant mix recommendations by merchandise/service category and size, rental rates and CAM, absorption including timing and staging of development, necessary features, parking requirements and amenities. Parkshore Plaza High-Rise Condominium Market Evaluation Downtown St. Petersburg, Florida PRG conducted a study to evaluate market support for high-rise luxury condominium development on downtown St. Petersburg waterfront. Work completed included a demand analysis covering unit mix by size and floor plan, unit pricing and pricing strategies, target market, sales and marketing strategies, and estimated absorption. Fiddler's Creek - Naples Florida Market Feasibility for a Neighborhood Shopping Village PRG conducted a market feasibility study to determine demand potential and development opportunities for a "Traditional Neighborhood Design' (TND) Town Center shopping village for a master planned community located in southwest Collier County, Florida. The scope of work completed for this engagement included analysis of pertinent demographic and economic trends related to the nature and growth potential of demand for commercial retail 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 and office development; employment trends; retail expenditure potential; and demand for office by market segment. The final report addressed development strategies including type and size of supportable retail and office at the subject site; absorption trends; anticipated rents and lease terms; timing, phasing, and development; and design considerations. Downtown Hollywood Commercial Demand Study Hollywood, Florida PRG was part of an engagement team to conduct a demand analysis and strategic planning for the commercial component of a mixed-use development planned for downtown Hollywood. The scope of work completed included a demographic and economic analysis, determining the demand potential for commercial office and retail merchandise and service categories from on-site residents as well as the surrounding primary and secondary market areas. PRG also provided development strategy guidelines for size of development, tenant mix, timing, and phasing of development. Downtown Jensen Beach Commercial Demand Study PRG was part of an engagement team to conduct a demand analysis and strategic planning for commercial component of mixed-use development planned for downtown Jensen Beach. Scope of work completed included assessment of the demographic and economic determinants of demand, evaluating the demand potential for commercial office and retail by tenant type, merchandise and service categories, and providing development strategy guidelines, including development timing and phasing of development City of Mexico Beach, Florida Vision Plan PRG was part of an engagement team to assist the City of Mexico Beach with a "Vision Plan" outlining development and redevelopment strategies addressing, overall land-use issues and impacts, growth management, neighborhood housing and in-fill strategies, and balancing of seasonal impacts. Assistance also included identifying funding sources of plan implementation. 18 . . . . . . . . . . . I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q) ro c ..... .- C/) ~UJ c..(ij .:s:. Q) co:: ~<9 U-o:: c.. .c: (.) ..... OJ Q) C/) .c: Q) ~o:: OJ'C ~Qi Q)U:: 0:::;::. Q) .:s:. ..... OJ :2 0) ..- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 D. STAFFING Paul Lambert Managing Principal Paul Lambert founded Lambert Advisory in 1995, and has since worked with a wide range of clients including financial institutions, multinational corporations, developers, government agencies, and investors. Mr. Lambert was previously with Arthur Andersen LLP and Goodkin Research Corporation, where he was in-charge of the firms' Florida and Latin American/Caribbean real estate practice. His clients include Harvard University, Samsung Corporation, Carnival Corporation, The Upper Manhattan Empowerment Zone, among others. Mr. Lambert is a regular contributor to the GOODKIN REAL ESTATE REPORT, and has appeared on CNN, ABC, and The Nightly Business Review to speak about the economy and real estate. He is often invited to speak about the economy and industry to national groups including the National Builders Association, Women's Bankers Association, Council of Large Public Housing Authorities, and the National Association of Corporate Real Estate Executives. In the early 1990's, Lambert was commissioned by the Commonwealth of Massachusetts to prepare a White Paper to guide the Governor in decisions concerning State housing programs, and currently serves as an advisor to a number of cities with regard to their housing and economic development efforts. He is a contributing author of "Public Housing Asset Management: A Handbook for Local Governments" recently published by The Community Development Training Institute, as well as HUD's "Guidebook on Private Management of Public Housing". He also continues to serve as a principal consultant to Harvard University's Public Housing Cost Study. Mr. Lambert holds a BA from Miami University in Ohio. He was a Fellow at the London School of Economics in London, England, and graduated from the Massachusetts Institute of Technology, where he received a Master degree in City Planning. 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 Eric tiff Principal Eric Uff has over 14 years of experience providing advisory services to government agencies, financial institutions, and corporations both domestically and internationally. Prior to joining Lambert Advisory, Mr. Uff was .responsible for acquisition and development activity at WorldStar Resorts, an entity of Starwood Capital. His primary responsibilities included corporate. and/or asset identification, deal structuring, due diligence and strategic positioning. Before joining WorldStar, Mr. Uff provided real estate advisory services for two Big 5 accounting firms, servicing some of the largest real estate and hospitality firms and investment banks in the United States and Caribbean. As a Manager in the Real Estate Consulting Group of KPMG Peat Marwick and a Senior Consultant with the Real Estate Consulting Group of Arthur Andersen LLP, Mr. Uff was actively involved in acquisition, disposition, and underwriting engagements for firms such as CS First Boston, Morgan Stanley, Prudential, and Heller Financial. Additionally, Mr. Uff has managed a number of major workout transactions and litigation related support engagements. Mr. Uff earned his Bachelor of Science degree with a concentration in real estate management and development at the University of Southern California in 1990. He is a member of the Urban Land Institute (ULl) and has been an active participant in the American Resort Development Association (ARDA). 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 Adrienne Brown Senior Analyst Adrienne Brown has more than eight years in economic development, urban planning, urban design, and feasibility analysis. Prior to joining Lambert Advisory, Ms. Brown was an analyst with Economic Research Associates (Washington, D.C.), where she assisted in managing public and private sector clients in the areas of planning and economic development, real estate and land use, and recreation and tourism. Ms. Brown has a particular expertise in retail demand analysis and strategic planning working on downtown retail development and retail master-planning projects throughout the United States. Ms. Brown commenced her career with Sibley International, working as a Project Coordinator on economic development projects including micro-, small-, and medium-size enterprise development in South Africa, Russia, Ukraine, the Republic of Georgia, as well as the Caribbean. Specifically, Adrienne worked on creating and implementing procurement plans, including preparation of requests for proposals, RFP evaluations, and price and terms negotiation. Ms. Brown has a Bachelor's in Business Administration (International Business and Spanish) from James Madison University. Additionally, she has completed coursework toward a Masters in Community Planning (Urban and Regional Planning) from the University of Maryland at College Park. 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 Frank Pallini PRG Real Estate Research Frank Pallini is founder and President of PRG Real Estate Research, a real estate management consulting firm based in the Tampa Bay area. Mr. Pallini has over 16 years of professional experience as a management consultant to the real estate industry. His areas of expertise include market and financial analysis, development/project planning, strategic planning, asset evaluation, economic research and impact analysis. Mr. Pallini has served as management consultant and business advisor to numerous real estate companies, developers, builders, financial institutions, investors and asset managers as well as units of government and non-profit organizations. Major clients include, Disney Development, USAA Real Estate, GE Capital, US Home, Beneficial, and Citicorp Real Estate. He has also served as project manager/lead consultant for a housing demand study for the University of South Florida, St. Petersburg Campus; the St. Petersburg Housing Study sponsored by the St. Petersburg Chamber of Commerce; the City of Key West, to study the impact of the vacation rental market on the local economy; Hillsborough County Master Facilities Plan; and, as technical advisor to the City of Tampa's Cultural Arts District Committee. Prior to starting his own firm, Mr. Pallini served ten years with KPMG Peat Marwick's Real Estate Management Consulting Group. During his tenure with KPMG, Frank advanced to level of Senior Manager where he was director of the firm's southeast real estate management consulting practice. In this capacity he was responsible for all phases of practice development, and provided management consulting expertise to clients throughout the United States, Europe, Latin America, and the Caribbean. Mr. Pallini has written several articles covering regional real estate industry trends for the Urban Land Institute, the Real Estate Review, published by Warren, Gorham and Lamont and numerous local publications covering real estate business and trends in Florida and the Tampa Bay area. Frank obtained his Bachelor's degree from Eckerd College and completed graduate' course work for the Master's Program in Community Development at Southern Illinois University. He also has completed continuing education and enrichment courses in real estate finance from the Massachusetts Institute of Technology. 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . City of Clearwater Downtown Clearwater Market Study February 28, 2005 E. REFERENCES Reference: Contact: Address: Phone: City of Ft. Lauderdale Mr. Mark Laferrier 300 N.W. 1st Avenue Ft. Lauderdale, FL 33301 (954) 828-5261 Services provided: Economic and Market Analysis for the Downtown Fort Lauderdale Master Plan and CRA (Palazzo) Dates: 2003/4 Total Fees: $20,000 Services provided: Economic/Market Master Plan Dates: Total Fees: Reference: Contact: Address: Phone: Reference: Contact: Address: Phone: City of Miami DDA Mr. Davon Barbour 200 South Biscayne Boulevard Miami, FL 33131 (305) 579-6675 Research Analysis for the Downtown Current $106,000 (including subcontractors) City of Plantation (CRA) Ms. Marcia Berkley 401 N.W. 70th Terrace Plantation, FL 33317 (954) 797-2200 Services provided: Plantation Gateway 7 Catalytic Investment Strategy Dates: 1999-Present Total Fees: $83,000 Reference: Contact: Address: Phone: Tampa Housing Authority Mr. Leroy Moore 1514 Union Street Tampa, FL 33067 (813) 253-0551 Services provided: Central Park HOPE VI Redevelopment Plan Dates: 2004 Total Fees: $278,000 (including subcontractors) 24