Agenda Packet 10-17-18 Work Session

Home Browse Search

Page 11 Prepared for: City of Eugene Prepared by: PNW Economics, LLC Market & Financial Analysis of Gordon Lofts MUPTE Program Application Retail Market Analysis: Documented Lease Rates The ground floor of Gordon Lofts, or an estimated 9,231 square feet of ground floor space is planned to be retail commercial space for lease. The Gordon Lofts MUPTE application on page 2 documents that the project expects to lease for an average of $2.75 per square foot monthly triple-net (“NNN”), or $33.00 annually. Triple-net lease rates assume retail tenants will themselves pay for real estate/ property taxes, building insurance, and maintenance costs in addition to their own utilities and related costs to run their business. To evaluate the planned retail space lease rate at Gordon Lofts, a survey of currently available retail space citywide as well as downtown or in the vicinity was compiled from Loopnet.com, an online listing service clearinghouse for numerous real estate brokerages. Average lease rates at 5th Street Market occupied space was also provided by Obie Companies for context. Table 8 provides a summary of that query. Table 8 – Gordon Lofts Planned Retail Lease Rate and Competitive Market Position (Triple-Net) • The planned $2.75 per square foot monthly lease rate is slightly lower than the current average 5th Street Market lease rate of $2.78 per square foot monthly. • The planned retail lease rate is commensurate with retail concentrations outside of downtown and among the six highest citywide for currently vacant space. Low High Low High Low High Six Highest Asking Retail Lease Rates - Eugene 1079 Valley River Way 1,248 1,248 $3.00 $3.00 $36.00 $36.00 440-460 Coburg Road 1,170 3,000 $2.25 $2.67 $27.00 $32.04 1777 Coburg Road 1,341 1,773 $2.67 $2.67 $32.04 $32.04 747 E 32nd Avenue 1,725 5,371 $1.83 $2.50 $21.96 $30.00 847 Seneca Road 2,585 2,585 $2.50 $2.50 $30.00 $30.00 2300-2500 W 11th Avenue 1,020 3,500 $1.67 $2.50 $20.04 $30.00 Seven Highest Downtown/Broadway Corridor Asking Retail Lease Rates 630 E 13th Avenue 2,715 2,715 $2.25 $2.25 $27.00 $27.00 515 E Broadway 1,321 1,321 $2.23 $2.23 $26.76 $26.76 1203-1245 Willamette Street 600 600 $1.75 $1.75 $21.00 $21.00 856-888 Willamette Street 3,786 21,628 $1.35 $1.35 $16.20 $16.20 505-545 High Street 886 886 $1.58 $1.58 $18.96 $18.96 220 W 8th Avenue 1,866 2,658 $1.00 $1.35 $12.00 $16.20 959 Pearl Street 2,931 2,931 $1.30 $1.30 $15.60 $15.60 5th Street Market 0 0 $2.78 $2.78 $33.36 $33.36 Subject Property - Planned 1,165 9,231 $2.75 $2.75 $33.00 $33.00 SOURCE: www.loopnet.com, Obie Companies Monthly Lease Rate (NNN) per Square Foot Annual Lease Rate (NNN) per Square FootSq. Ft. Available October 17, 2018, Work Session – Item 2