Client: City of Brookfield (WI)
The City of Brookfield (WI) engaged Gruen Gruen + Associates (GG+A) to conduct market research and real estate economic analysis to determine if the Brookfield Square Mall/ Executive Drive Redevelopment Area could support the amount of land use products specified in the Brookfield Square Mall/ Executive Drive Redevelopment Plan prepared by RTKL Associates. GG+A was also asked to determine if the RTKL plan is likely to be financially feasible to implement.
GG+A conducted property inspections and interviews with developers and marketing agents for market area multi-family, office, and retail developments in order to identify the following:
• The physical characteristics of potentially competitive developments and the type of product, unit, service and amenity features most preferred by residents/tenants;
• The rents or sales prices obtained and absorption rates and the relationship between (1) locational and physical characteristics and (2) rents or sales prices and (3) absorption and occupancy rates; and
• The demographic and geographic origins of renters, buyers, or customers at these potential competitive supply options.
GG+A also prepared a survey questionnaire to test for the potential demand from workers officing in Executive Drive and other buildings for a variety of residential product types. This survey yielded information and insights on (a) the demographic characteristics of area workers, (b) the housing patterns of the workers; (c) the factors most influential to their housing purchase or rental decisions; (d) the level of interest in renting or purchasing apartment, loft, or townhouse products at the redevelopment area; and (e) the reasons for not wanting to rent or purchase.
We analyzed relevant demographic, employment and real estate data, as well as the results of the survey and broker and developer interviews. GG+A simulated the real estate investment results of postulated development alternatives for the Brookfield Square Mall/ Executive Drive Redevelopment Area. The real estate economic analysis of the proposed RTKL plan drew on GG+A’s forecasts of rents and absorption for each land use, capital market research GG+A conducted, and development cost estimates formed by the City and by The Jansen Group, a general contractor and construction manager GG+A retained as an advisor. GG+A’s real estate economic analysis resulted in estimates of the size of the subsidy needed to bridge the feasibility gap of each postulated redevelopment alternative under the RTKL plan. Based on the investment simulations, market research and surveys and an “advisory panel” GG+A organized, GG+A identified reprogramming options that would be feasible with no or substantially reduced subsidy requirements. GG+A also recommended an alternative implementation strategy that would significantly reduce municipal risk and increase the potential for value-enhancing private development.
GG+A gave presentations to the Community Development Authority and the public following the completion of the market analysis and real estate economic analysis. The Community Development Authority accepted the findings and recommendations.