Town Council Study Session

Transcription

1 Town Council Study Session Success of Local Business: Main Streets and the Housing Connection January 17, 2018 Study Session Oro Valley s Future Economic Development, Main Streets and Housing Market Study Lessons Learned Future Decisions Takeaways 1

2 Looking to the Future Oro Valley Community Challenges: Approaching build out Shifting land use needs Consider: Economic development Housing as driver We are here Growth Maturity Decline We are here Goal: Long term sustainability Growth Maturity Renewal Purpose Be proactive and strategic Understand the issues Frame future decisions Think of economic development and land use together Residential, office and retail are connected Housing growth, density, diversity Don t sacrifice commercial and employment areas Be smart with remaining land Be patient and make sustainable decisions Think about new programs and flexible zoning Housing diversity Resident diversity Economic sustainability 2

3 Young Professionals Spend more money Acquisition vs. disposition mode Spend on commercial and retail Supports Town services Sustains commercial areas for everyone Drive movement in residential market Do your kids live here? Could they if they wanted to? Who buys your home when you want to downsize? Looking to the Future Complete Community To be a well managed community that provides all residents with opportunities for quality living. Oro Valley will keep its friendly, neighborly character, while increasing services, employment and recreation. The Town s lifestyle continues to be defined by a strong sense of community, a high regard for public safety and an extraordinary natural environment and scenic views. 3

4 Looking to the Future Oro Valley Main Streets Community desire for a town center Plan now for long term Address build out and growth pressure Enhance character and appeal Attract young professionals Support businesses Use innovative programs and zoning Location Characteristics Unique in Oro Valley Many housing units within walking distance Nearby parks and recreation Nearby civic uses Varied and vibrant commercial areas Available parking and circulation areas Interested businesses and property owners Lambert La Cañada 4

5 Opportunity Exists Public Right of way Private Vacant land Parking areas Opportunity areas Future Opportunity Thinking Ahead 5

6 RESIDENTIAL AND MASTER PLANNED COMMUNITY OFFICE (Purple) COMMERCIAL (Blue and Red) Main Streets Market Study Purpose and Topics Conditions and opportunities for real estate development and redevelopment 5 10 year timeframe Ground policy, design and development proposals within context of market conditions 1. Executive Summary 2. Context 3. Site Analysis 4. Housing Market 5. Office Market 6. Retail Market 7. Parking Analysis 8. Recommendations 6

7 Community Vitality All aspects are connected Residential Office Retail Oro Valley Growth Based on trends: Solid job growth Consistent population growth However: Community almost built out Smart decisions needed for remaining land Note: Across all land use categories, Oro Valley is 85% built out 7

8 Comparison Areas Nearby households: At least 50% more than Oracle/1st At least 3 times more than Lambert/La Cañada The Residential Market Tucson Region Options Struggle to serve first time homebuyer, including young professionals and the general workforce Huge gap in pricing Homes under $250,000 70% of resales 30% of new home sales Homes over $250,000 30% of resales 70% of new home sales 8

9 The Residential Market Oro Valley Options One of the least affordable submarkets New home pricing is a function of land pricing and availability New homes 60% higher than County Resales 44% higher than County Oro Valley Residential Activity Current Development Healthy building activity for single family detached Estimated 7 year lot supply available Limited activity for singlefamily attached Limited multi family, regional demand exists Future Development Depends on development requests and site conditions Developed 78% of land 8,221 acres 21,766 units Residential Land (Based on Current Trends) Vacant 22% of land 2,339 acres ~5,800 units Active and Planned 14% of land 1,473 acres ~2,200 units Unknown 8% of land 866 acres ~3,600 units 9

10 The Residential Market Opportunities Capture the Missing Middle Near term (3 5 years) Increase residential density Develop a variety of housing types Target the $300k and under homebuyer to capture a larger market share Longer term (5+ years) Add mixed use development The Office Market Trends and Opportunities National Office market in flux Changes impacting new development: Central business district Densification (less space/worker) What s considered Class A Tucson Region Strong performance Since 2007, higher vacancy and lower rental rates Cautious regarding speculative office development Oro Valley Medical office development multi physician specialty offices 90,000 sf (5 year supply) of unabsorbed office space in Oro Valley Innovation Park and potential expansions Future U of A Vet School Main Streets Office/retail and services 10

11 The Retail Market Trends and Opportunities National Continued expansion of online retailing Shrinking retail footprints Shifting demographics Consumer preferences changing Store shift from sales to services Emphasis on placemaking Tucson Region No speculative retail, need 50% commitment to get started Retail development more dispersed Oro Valley Overall Oro Valley delivers around 22,000 sf of retail a year 160,000 sf of retail is vacant now Main Streets Areas Undeveloped vacant retail pads Baby boomer driven retail Key Findings Housing as Driver Attracts new businesses Supports existing businesses Grow # of households Increase density Diversify types and price point Makes alternative transportation viable Strengthens existing employment areas Attracts new employers Provides options for all residents 11

12 Rancho Vistoso Original PAD Remaining Commercial Rancho Vistoso RESIDENTIAL COMMERCIAL Original PAD Current % of Original COMMERCIAL ACRES Rezoned Vacant Developed 8% 13,862 residential units 9,470 units developed or planned 68% 27% 65% 12

13 OV Marketplace Compared to all Vestar Properties in Arizona Chandler Gilbert Glendale Mesa Oro Valley Peoria Phoenix Scottsdale Tempe Queen Creek Average OV Marketplace Size in sq. feet 570, ,000 Income within 5 7 miles Population within 5 7 miles Population per sq. mile Sq. feet per person $83,008 $89, , ,826 41,739 18, OV has too much supply and not enough people OV Marketplace Compared to other Oro Valley areas Location OV Marketplace Pop. (1.5 miles) Households (1.5 miles) Retail planned (sq. ft.) 2, ,000 Vacant 250,000 sf unbuilt Tangerine Oracle Lambert / La Cañada 5,846 2, ,000 52,600 sf unbuilt Oracle / 1 st 8,561 4, , ,000 sf unbuilt Casas Adobes 13,241 6, ,000 0 sf 13

14 Oracle Corridor Encantada at Steam Pump 288 units, 91% occupied Villas San Dorado 274 units, 93% occupied Panera Bread Chipotle Mexican Grill Jersey Mike s Subs MOD Pizza Canyons at Linda Vista Trail 228 units, 93% occupied Lessons Learned Rancho Vistoso Less than planned residential built Commercial land loses viability Vacancy and commercial conversion OV Marketplace Lacking residential nearby Competing commercial areas High vacancy and struggling commercial Oracle Corridor Planning for residential and commercial Higher density residential built New and successful businesses 14

15 Takeaway #1 Be patient and make sustainable decisions Opportunity for creative infill and redevelopment Make choices that will support retail and office sectors housing for young professionals and the workforce Density Variety Price point La Cholla Corridor Tangerine Naranja Lambert 80 units 217 units 500 units Apartments? Major corridor Current capacity: 14,000 trips/ day Future capacity: 24,000 trips/day Development coming Saguaros Viejos Shannon Road Capella Fasseas Consider: Commercial viability Community benefits 91 units 15

16 La Cholla Corridor Naranja Lambert La Cholla (Current + Planned) La Cholla and Naranja 1,100 units (Current + Planned) La Cholla and Lambert 600 units La Cañada (Current) La Cañada and Lambert 1,500 units (53,000 sf vacant!) Retailers will look for: Location # of households nearby Traffic capacity and access Uses aligned with the market Innovation Park and Office Areas Innovation Park Area Tangerine Road Oracle Road Land Use Analysis Innovation Park Area 12 projects built since acres average project size 51% of buildable land is developed or planned for development 20 year supply of land remains Commerce / Office Park Land Use Built Out Planned Development Remaining Vacant Other Buildable Land Uses 16

17 Innovation Park and Office Areas Land Use Analysis Oro Valley Marana, AZ Boulder, CO Carlsbad, CA Scottsdale, AZ Chandler, AZ Population 43,565 43, , , , ,098 Total Land (sq/mi) Land Use Emp Acres 400 (2%) 9,818 (13%) 2,313 (14%) 1,424 (6%) approx. 3% 6,135 (15%) Land Use Emp Built Out 188 (47%) 1,473 (15%) approx. 13% 472 (33%) approx. 15% 3,485 (57%) Economics of Residential and Retail Perception: Only residents support retail Reality: Office workers and residents offer about the same retail spending power in a single person comparison Commercial and employment areas: Don t need as many services Serve to create synergy Necessary for long term sustainability Add housing strategically Positive Upzoning residential Negative Downzoning commercial and employment 17

18 Future Decisions La Cholla Corridor Planning for residential and commercial Pressure to reduce # of housing units? Employment Areas Planning for office and employment Pressure to convert employment to residential? Takeaway #2 Think about new programs and flexible zoning Reevaluate development regulations and zoning Establish an overlay or redevelopment district Fast track and incentivize varied residential in infill locations Permit easy redevelopment of vacant big box stores Even faster track for tech park (EEZ++) 18

19 Summary Be proactive and strategic Think of economic development and land use together Be smart with remaining land Past Challenges Past and Future Success Discussion What surprised you? What resonates with you? What are some actions you would like to see? How will you use this information? What would you like more information on? 19

20 Takeaways Be patient and make sustainable decisions Opportunity for creative infill and redevelopment Make choices that will support retail and office sectors housing for young professionals and the workforce Density Variety Price point Think about new programs and flexible zoning Reevaluate development regulations and zoning Establish an overlay or redevelopment district Fast track and incentivize varied residential in infill locations Permit easy redevelopment of vacant big box stores Even faster track for tech park (EEZ++) 20