Draft EUG Master Plan Update, February 2010

Home Browse Search

CHAPTER 5 FINANCIAL FEASIBILITY ANALYSIS a full level of services available. These unit prices are for industrially related uses, so if a commercial use could be placed on this site, an increase of almost twice the demonstrated unit price could be achieved. The eventual construction of the State Mental Hospital and Prison will enhance the demand for this site; however it may be several years before construction is started. Access to the state Highway will be highly scrutinized by ODOT (Oregon Department of Transportation). The 40-acre parcel that parallels the new runway would receive a reasonable level of market interest; however, public utility services will need to be provided because wells and septic tanks are not practical. There is a good level of market demand for smaller buildable industrially zoned sites; however, the recent substantial increase in fuel costs has created a perception that the outlying areas are now less desirable when compared to other sites due to the increases in transporting materials and personnel. When this property is divided into smaller parcels (recommended 3-5 acre parcels) then a unit price of $2-$3 per square foot is anticipated; however, the costs of making the property buildable will need to be deducted such as partitioning, fill material, services and/or approvals, and the extension of utilities such as electric, phone and other related costs. The smaller 2-acre parcel on Airport Road will be readily accepted if marketed for sale as it enjoys considerable traffic exposure. Assuming the sites’ proximity to the pond does not render it unbuildable; a sale of the property for a light industrial type of use is anticipated. The 11-acre parcel at the northwest corner of Airport Road and Douglas Drive is the most viable for generating revenue in the short-term. In addition, the smaller parcel located at the northeast corner of the same intersection is also perceived as having good potential of being accepted by the marketplace for traditional airport related uses. Assuming a range of uses consistent with those permitted in the C-1 or C-2 zones, a range of market prices in the $6-10 per sq ft range is anticipated for this property. The variance in price is dependent on the amount of fill that is needed to bring the site to a buildable condition as well as where access will be located. If there are restrictions on lighting and other elements of a traditional commercial use, then these could have a downward affect to the price, however it is not perceived as being substantial. This location is considered to have the greatest potential for generating revenue, both in amount per acre and timing. Creation and implementation of an overall marketing plan is critical to achieving market participation beyond a few specific users. It is recommended that the city move forward with creating such a plan for any property it is contemplating leasing or selling. At a minimum, the plan should include a list of permitted uses and restrictions for the properties, a description of current utilities and how these services may be provided in the future, full disclosure of all wetlands the City’s willingness to pay brokerage fees, and a complete description of the process to be utilized to obtain City approval for any lease or sale. Finally, it is recommended that pricing should be based on perceived unit prices considered comparable to the properties being conveyed, recognizing that many uses will be totally dependent on their proximity to the Airport. In undertaking its marketing plan, the City should remain cognizant of the fact that local market conditions are beginning to show signs of slowing. It is conceivable there will be a very limited demand for many of the properties being considered for revenue generation. The agricultural demand has remained relatively unchanged over the past decades and even if there is a recession, the income potential estimated for these properties is estimated to remain relatively unchanged. The demand for the 5-38 Eugene Airport Master Plan Update (February 2010)