Investment Opportunity Study

Page 1

Produced by: The Developers Council, Charleston Metro Chamber of Commerce January 2019


INTRODUCTION PURPOSE

Think of the Investment Opportunity Study as a mirror. By compiling demographic, economic and real estate data, along with information on the development approval process, we can see ourselves the way a prospective investor sees us. We are not holding up a mirror to admire our finer features or to scrutinize our flaws. Instead, we think a clear-eyed look at our core metrics will more clearly reflect our opportunities – opportunities to better leverage assets, to strengthen our policy climate and to streamline processes.

The purpose of the study is to establish a fact-based platform for collaborative partnerships with local governments on shared priorities. Local government’s own comprehensive plans are the basis for identifying those priorities. This study does not attempt to alter any local government’s goals or visions. Rather, through the study we hope to enhance policies and processes to make it more likely that established goals are met. When we see our communities as an investor sees them, we can better position ourselves to achieve whatever future we envision.

Data is the heart of this study because all savvy investors demand the data. 90% of the reported data comes from long-established, publicly available sources including the U.S. Census Bureau, Charleston Trident Association of Realtors, Avison Young and other sources. Where appropriate, we have relied upon survey data from design professionals of the Developers Council and the professional staffs of the various municipalities.

CONTENTS

This report is organized into two levels: regional and jurisdictional. The regional data and macro trends analysis captures the over-arching business climate which is the backdrop to any investment in the region. Data points for each jurisdiction allows us to focus on decision drivers for investments in a specific location.

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

How investors see our region matters because most of our collective goals and aspirations hinge on private investments. Independent capital decisions drive quality of life factors for everyone, including job and wage growth, housing types, retail and restaurant options. For local governments, private investments (or lack thereof) mean a growing tax base or a stagnate one.

PROCESS


REGIONAL TRENDS STRONG JOB GROWTH

CONTINUED POPULATION GROWTH

Over the past two decades, the Charleston Region has enjoyed incredible success diversifying its economy. Military and hospitality jobs that once dominated employment are now balanced with equal or larger employment bases in aerospace, automotive, logistics, software/IT and medical jobs. Conservative estimates project 35,000 additional new jobs over the next five years with 80% of those jobs in 10 high growth sectors.

The Charleston region’s population has experienced a long run of steady population growth. We’ve grown at roughly 2% per year since the 1970’s. Growth projections show neither surge nor slow down. Continuing at our projected pace, the region will top one million residents by 2030. POPULATION TRENDS / PROJECTION 1,200,000

2017 - 2022 JOB GROWTH Production

5,911 & Mechanical 4,444 Hospitality

Business

3,391 Operations Support

800,000 600,000 400,000 200,000 0

862 Education

2%

AVERAGE GROWTH PER YEAR SINCE THE 1970’s

0

1,129 Construction

3 20

Business

1,134 Management

5

2,089 Logistics

2 20

Personal

2,507 Services

0

2 20

6

1 20

0

1 20

0

0 20

0

9 19

0

8 19

0

7 19

2,535 Software & IT

Source: US Census, SC State Data Center

00

6,0

00

5,0

00

4,0

00

3,0

00

2,0

00

1,0

0

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

3,661 Medical

1,000,000


REGIONAL TRENDS ATTAINABLE HOUSING STRESS The cost and availability of housing have quickly become critical regional issues. Between 2010-2016, the median home sale price increased by 27% and rental rates increased by 49%, while average wages grew 12%. Nearly a third of homeowners are burdened by their mortgage and the average low-income resident spends 71% of their income on housing and transportation.

CONTINUED...

RESIDENTIAL BUILDING PERMITS ISSUED 11,000 Source: US Census 10,000 9,000 8,000

7,500

7,000

112,309 Total New Housing Units Needed Region-Wide Between 2015 and 2030

6,000 5,000

Nearly half of those homes should be priced for households earning $50,000 or less annually Meaning a sales price of $175,000 - $225,000 or an average monthly rent of roughly $1,200

3,000 2,000 1,000 0

'17

'16

'15

'14

'13

'12

'11

'10

'09

'08

'07

'06

'05

'04

'03

Inadequate supply of new housing to meet demand is a major driver of the rapid price escalation. While the region adds at least 7,500 new households annually, we have failed to permit that number in any year since 2006.

NEW HOUSING UNITS NEEDED PER YEAR TO KEEP UP WITH POPULATION GROWTH

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

4,000


REGIONAL TRENDS SHIFTING POPULATION AND EMPLOYMENT CENTERS Population and employment have grown in most corners of the region, but the growth rates are uneven. Consider that all of the top ten zip codes for jobs in 2005 remain in the top ten in 2015. But their order has changed and their growth rates over that decade range from a 106% increase in the 29418 zip in Northwest North Charleston to a 19% decrease in the lower Peninsula.

CONTINUED...

A glance at our most populous and fastest growing zip codes shows that settlement patterns are outside the legacy “core” of the region and don’t coincide with the largest and fastest growing employment zip codes. The top three largest zip codes by population are all North/West of Ashley Phosphate Road. Meanwhile, the population in some large zip codes nearer to the legacy core of the region (Inner West Ashley 29407 for example) is actually falling.

AREA

JOBS 2005

JOBS 2015

% CHANGE

ZIP

AREA

POP 2006

POP 2015

% CHANGE

29406

North Charleston

32,208

37,282

15.8%

29483

Summerville

53,270

70,975

33.2%

29403

Upper Peninsula

18,719

28,598

52.8%

29445

Goose Creek

50,637

58,048

14.6%

29418

North Charleston

13,805

28,413

105.8%

29485

Summerville

32,854

50,574

53.9%

29464

Mount Pleasant

21,736

26,959

24.0%

29464

Inner Mount Pleasant

42,829

47,589

11.1%

29401

Lower Peninsula

31,177

25,375

-18.6%

29412

James Island

33,791

37,908

12.2%

29407

West Ashley

19,587

24,261

23.9%

29414

Outer West Ashley

26,885

37,210

38.4%

29405

North Charleston

23,344

23,802

2.0%

29407

Inner West Ashley

36,091

33,884

-6.1%

29483

Summerville

15,274

20,789

36.1%

29461

Moncks Corner

24,908

33,320

33.8%

29461

Moncks Corner

11,750

11,122

-5.3%

29466

Outer Mount Pleasant

21,803

32,193

47.7%

29445

Goose Creek

11,063

10,881

-1.6%

29406

Hanahan / North Charleston

39,689

30,783

-22.4%

All Other Zips

All Other Areas

57,107

81,137

42.1%

29456

Ladson

19,394

30,730

58.5%

29420

North Charleston

16,425

23,159

41.0%

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

ZIP


REGIONAL TRENDS

CONTINUED...

RISING TRAFFIC CONGESTION According to a Congestion Management report issued by CHATS in November 2018, the average commute times regionwide have risen only slightly from 2000 to 2014. But commuters in some of the most congested corridors routinely spend up to 25% more time on the road due to peak hour traffic. Perhaps more importantly, over half of commuters say they are unsatisfied or very unsatisfied with their commute times and more than two thirds surveyed believe traffic and congestion is the region’s biggest problem.

LEVEL OF SERVICE (LOS) RATING FROM 2015 -B ASED ON VOLUME TO CAPACITY RATIO

DORCHESTER

BERKELEY

UNSATISFIED OR VERY UNSATISFIED WITH TIME IT TAKES TO GET TO WORK

CHARLESTON

68%

TRAFFIC AND CONGESTION IS THE #1 PROBLEM

Meanwhile, without additional new capacity projects beyond what is already planned, traffic models project that by 2040 nearly 70% of road miles in the region will be nearing or over capacity with unstable traffic flow.

LOS A

LOS D

free flow

approaching unstable flow

LOS B

LOS E

reasonably free flow

unstable flow / at capacity

LOS C

LOS F

stable flow

breakdown flow

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

51%


15,700 1,144

AREA OVERVIEW

7,351

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

42,039 40.09 31.3 60.9% $61,542 10.6%

HOUSING DATA Households Median Home Sale Price Goose Creek / Monks Corner Median Mortgage Cost Median Gross Rent

13,741 $240,803 $1,270 $1,114

INDUSTRIAL OFFICE

Outlying Berkeley County Inventory Vacancy Rate Asking Rent North Suburbs Inventory Vacancy Rate

COMMUTE PATTERNS In Area Laborforce Efficiency

6.8%

GOOSE CREEK MUNICIPAL REPORT

RETAIL

Asking Rent Goose Creek Inventory Vacancy Rate Asking Rent

20,280,912 sq ft 13.5% $4.72 1,677,326 sq ft 4.1% $26.47 1,051,633 sq ft 2.3% $15.19

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

* See Submarket Maps section

COMMERCIAL REAL ESTATE


• Median home prices are very affordable, particularly relative to the median household incomes of Goose Creek residents • Demographic advantages include median age and poverty rate below the national and regional averages •T he retail market has a vacancy rate significantly lower than the region’s and asking rents that are very competitive with the region’s rate

DEVELOPMENT TIMELINE PROJECTIONS

SINGLE FAMILY

HIGHLIGHTS

CONSULTANT LOW

12

GOVERNMENT

12 - 24

CONSULTANT HIGH

28

• In-area labor force efficiency is the region’s lowest and creates greater transportation congestion for the region

0

10

20

30

40

50

60

70

80

WEEKS

PARTNERSHIP PRIORITIES • Promote increased adoption of development process best practices including electronic filing and permit tracking

MULTI-FAMILY

• Development timelines and relative processing costs are competitive CONSULTANT LOW

12 12 - 24

GOVERNMENT CONSULTANT HIGH

29 0

• Identify and advocate for infrastructure enhancements and policy changes to promote creation of a “City Center” for Goose Creek

10

20

30

40

50

60

70

80

WEEKS

• Explore transit-oriented development opportunities related to Lowcountry Rapid Transit • Support attainable housing best practices

COMMERCIAL

• Identify opportunities for growth of new employment centers and redevelopment of existing commercial space CONSULTANT LOW

12 4-8

GOVERNMENT CONSULTANT HIGH

28 0

GOOSE CREEK

10

20

30

40

50

60

70

80

WEEKS


16,617 2,524

AREA OVERVIEW

14,433

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

49,323 18.05 35.6 65.2% $56,962 10.5%

HOUSING DATA Households Median Home Sale Price Greater Summerville Median Mortgage Cost Median Gross Rent

17,223 $238,995 $1,449 $1,027

INDUSTRIAL OFFICE

Dorchester County Inventory Vacancy Rate Asking Rent North Suburbs Inventory Vacancy Rate

COMMUTE PATTERNS In Area Laborforce Efficiency

13.2%

SUMMERVILLE MUNICIPAL REPORT

RETAIL

Asking Rent Summerville / Ladson Inventory Vacancy Rate Asking Rent

7,624,431 sq ft 2.1% $5.53 1,677,326 sq ft 4.1% $26.47 3,579,980 sq ft 2.4% $16.72

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

* See Submarket Maps section

COMMERCIAL REAL ESTATE


HIGHLIGHTS

DEVELOPMENT TIMELINE PROJECTIONS

• Demographic advantages include median age and poverty rate below the national and regional averages • Office, retail and industrial markets are strong, with significantly lower vacancy rates than the region’s average • In-area labor force efficiency is low and creates greater transportation congestion for the region

SINGLE FAMILY

• Median home prices are very affordable compared with the region CONSULTANT LOW

CONSULTANT HIGH

• Examine and promote transit-oriented development opportunities related to Lowcountry Rapid Transit

28 0

10

20

30

40

50

60

70

80

WEEKS

MULTI-FAMILY

• Explore policy and market changes that could lead to more Class A office development

24 - 52

GOVERNMENT

• Development timelines and costs are competitive for the region

PARTNERSHIP PRIORITIES

16

• Ensure regional business community input in the 2019 Comprehensive Plan update

CONSULTANT LOW

16 28 - 32

GOVERNMENT CONSULTANT HIGH

42 0

10

20

30

40

50

60

70

• Evaluate potential impact of proposed Unified Development Ordinance

80

WEEKS

COMMERCIAL

• S upport completion of the Berlin G. Myers Parkway Phase 3 and other vital transportation infrastructure priorities CONSULTANT LOW

16 24

GOVERNMENT CONSULTANT HIGH

28 0

SUMMERVILLE

10

20

30

40

50

60

70

80

WEEKS


8,224 450

AREA OVERVIEW

4,689

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

24,885 10.7 35.1 69% $61,221 10.6%

HOUSING DATA Households Median Home Sale Price Greater Hanahan Median Mortgage Cost Median Gross Rent

8,104 $250,400 $1,511 $977

INDUSTRIAL OFFICE

Outlying Berkeley County Inventory Vacancy Rate Asking Rent North Charleston Inventory Vacancy Rate

COMMUTE PATTERNS In Area Laborforce Efficiency

5.2%

HANAHAN

MUNICIPAL REPORT

RETAIL

Asking Rent North Charleston / Hanahan Inventory Vacancy Rate Asking Rent

20,280,912 sq ft 13.5% $4.72 7,366,132 sq ft 9.2% $30.51 5,709,257 sq ft 5.7% $11.73

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

* See Submarket Maps section

COMMERCIAL REAL ESTATE


HIGHLIGHTS

DEVELOPMENT TIMELINE PROJECTIONS

• Demographic advantages include median age, workforce participation rate and poverty rate • Median household income is higher than the region • Median home prices and rent are relatively affordable for the regional (and Hanahan) median income

SINGLE FAMILY

• In-area labor force efficiency is relatively low and compounds traffic problems

4

GOVERNMENT

• Development timelines are relatively competitive

0

10

20

30

40

50

60

70

80

PARTNERSHIP PRIORITIES • Identify opportunities for growth of new employment centers and Town Center • Support attainable housing best practices and reinvestment and redevelopment of aging housing stock

MULTI-FAMILY

WEEKS

6

GOVERNMENT

• Collaboration with business community

0

• Alignment, coordination, and cooperation with Goose Creek and North Charleston

10

20

30

40

50

60

70

80

WEEKS

• Support infrastructure improvements: I-526/26, North Rhett Avenue, Yeamans Hall Road, Foster Creek Road • Explore relationship with Military • Potential branding opportunity support

COMMERCIAL

• Maximize LCRT potential (all 4 sites)

6

GOVERNMENT

0

HANAHAN

10

20

30

40

50

60

70

80

WEEKS


AREA OVERVIEW

22,058

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

84,170 45.08 39.3 68.6% $83,490 6.4%

HOUSING DATA

25,653

Households Median Home Sale Price Upper Mount Pleasant

8,422

Lower Mount Pleasant Median Mortgage Cost Median Gross Rent

31,018 $569,271 $520,000 $1,996 $1,403

24.7%

INDUSTRIAL OFFICE

Vacancy Rate Asking Rent East Suburbs Inventory Vacancy Rate Asking Rent

East Islands / Mount Pleasant Inventory

RETAIL

* See Submarket Maps section

COMMUTE PATTERNS In Area Laborforce Efficiency

East Islands / Mount Pleasant Inventory

Vacancy Rate Asking Rent

MOUNT PLEASANT MUNICIPAL REPORT

1,036,041 sq ft 1.4% $12.08 4,163,813 sq ft 8.5% $36.80 4,070,944 sq ft 2.6% $25.24

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

COMMERCIAL REAL ESTATE


HIGHLIGHTS

DEVELOPMENT TIMELINE PROJECTIONS

• Demographic advantages include high workforce participation, high median household income and low poverty rate • Asking rents are higher than the region’s average, the vacancy rate for industrial space is a fraction of the region’s rate • Relatively low in-area labor force efficiency contributes to regional traffic congestion

SINGLE FAMILY

• Median home prices are not affordable for region’s median household incomes CONSULTANT LOW

20 8

GOVERNMENT CONSULTANT HIGH

35 0

10

20

30

40

50

60

70

• Development costs are not competitive in the region

WEEKS

• Assist with the exploration, study and expansion of mass transit facilities • Explore development process improvement opportunities

MULTI-FAMILY

• Development timelines are typical for the region

PARTNERSHIP PRIORITIES

CONSULTANT LOW

20 14

GOVERNMENT CONSULTANT HIGH

35 0

• Support completion of Highway 41 capacity expansion and other vital transportation infrastructure priorities

10

20

30

40

50

60

70

80

COMMERCIAL

WEEKS

CONSULTANT LOW

18 UNREPORTED

GOVERNMENT CONSULTANT HIGH

32 0

MOUNT PLEASANT

80

10

20

30

40

50

60

70

80

WEEKS


27,808 15,392

AREA OVERVIEW

78,204

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

109,298 73.19 32.2 65.0% $39,703 22.7%

HOUSING DATA Households Median Home Sale Price Greater North Charleston Median Mortgage Cost Median Gross Rent

39,156 $198,000 $1,283 $909

INDUSTRIAL OFFICE

North Charleston Inventory Vacancy Rate Asking Rent North Charleston Inventory Vacancy Rate

COMMUTE PATTERNS In Area Laborforce Efficiency

35.6%

NORTH CHARLESTON MUNICIPAL REPORT

RETAIL

Asking Rent North Charleston / Hanahan Inventory Vacancy Rate Asking Rent

27,427,044 sq ft 7.1% $5.30 7,366,132 sq ft 9.2% $30.51 5,709,270 sq ft 5.7% $11.73

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

* See Submarket Maps section

COMMERCIAL REAL ESTATE


HIGHLIGHTS

DEVELOPMENT TIMELINE PROJECTIONS

• Higher than average poverty rate is juxtaposed by higher than average workforce participation rates • Office, retail and industrial markets are strong with large inventories in all three markets. The key difference when compared to the region is significantly lower average asking retail rents •T he 78,204 workers who travel every day to North Charleston from neighboring jurisdictions creates an enormous housing opportunity

SINGLE FAMILY

• Median home prices are very affordable, but median household income is well below the region CONSULTANT LOW

24 12

GOVERNMENT CONSULTANT HIGH

24 0

10

20

30

40

50

60

70

WEEKS

• Provide structured input to the 2019 Comprehensive Plan Update process by assembling a task force of diverse employers focused on key issues: - Creation of diverse and varied housing opportunities

MULTI-FAMILY

•T he development timelines and costs are the most competitive in the region

PARTNERSHIP PRIORITIES

80

CONSULTANT LOW

8 12

GOVERNMENT CONSULTANT HIGH

36 0

10

20

30

40

50

60

70

80

WEEKS

- Maintain and expand employment centers - Embrace Lowcountry Rapid Transit: plan for dense multi-use transit-oriented nodes • Facilitate open dialog between city officials and industry stakeholders to reduce friction and enhance performance of the permitting process

COMMERCIAL

- Plan for future infrastructure needs CONSULTANT LOW

8 12

GOVERNMENT CONSULTANT HIGH

24 0

NORTH CHARLESTON

10

20

30

40

50

60

70

80

WEEKS


AREA OVERVIEW

51,285

9,132

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

134,385 108.98 34 67.3% $57,603 16.3%

HOUSING DATA Households Median Home Sale Price

6,369

Upper Peninsula Downtown Charleston Daniel Island West Ashley Area James Island Johns Island Median Gross Rent

$485,350 $962,500 $849,900 $309,000 $371,000 $327,500 $1,695 $1,052

41.1%

CHARLESTON MUNICIPAL REPORT

INDUSTRIAL OFFICE

COMMUTE PATTERNS In Area Laborforce Efficiency

Greater Charleston Inventory Vacancy Rate Asking Rent Downtown Charleston Inventory Vacancy Rate Asking Rent

RETAIL

PENINSULA

* See Submarket Maps section

COMMERCIAL REAL ESTATE

Downtown Charleston Inventory Vacancy Rate Asking Rent

1,913,377 sq ft 4.1% $13.43 4,771,626 sq ft 3.1% $42.22 1,760,117 sq ft 2.6% $46.36

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

Median Mortgage Cost

53,348


AREA OVERVIEW

24,826

31,862

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

134,385 108.98 34 67.3% $57,603 16.3%

HOUSING DATA Households Median Home Sale Price

6,576

Upper Peninsula Downtown Charleston Daniel Island West Ashley Area James Island Johns Island Median Gross Rent

$485,350 $962,500 $849,900 $309,000 $371,000 $327,500 $1,695 $1,052

17.1%

CHARLESTON MUNICIPAL REPORT

INDUSTRIAL OFFICE

COMMUTE PATTERNS In Area Laborforce Efficiency

Greater Charleston Inventory Vacancy Rate Asking Rent Downtown Charleston Inventory Vacancy Rate Asking Rent

RETAIL

WEST ASHLEY

* See Submarket Maps section

COMMERCIAL REAL ESTATE

Downtown Charleston Inventory Vacancy Rate Asking Rent

1,913,377 sq ft 4.1% $13.43 4,771,626 sq ft 3.1% $42.22 1,760,117 sq ft 2.6% $46.36

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

Median Mortgage Cost

53,348


5,005

AREA OVERVIEW

9,881

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

134,385 108.98 34 67.3% $57,603 16.3%

HOUSING DATA

898

Households Median Home Sale Price Upper Peninsula Downtown Charleston Daniel Island West Ashley Area James Island Johns Island Median Gross Rent

$485,350 $962,500 $849,900 $309,000 $371,000 $327,500 $1,695 $1,052

15.2%

CHARLESTON MUNICIPAL REPORT

INDUSTRIAL OFFICE

COMMUTE PATTERNS In Area Laborforce Efficiency

Greater Charleston Inventory Vacancy Rate Asking Rent Downtown Charleston Inventory Vacancy Rate Asking Rent

RETAIL

DANIEL ISLAND

* See Submarket Maps section

COMMERCIAL REAL ESTATE

Downtown Charleston Inventory Vacancy Rate Asking Rent

1,913,377 sq ft 4.1% $13.43 4,771,626 sq ft 3.1% $42.22 1,760,117 sq ft 2.6% $46.36

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

Median Mortgage Cost

53,348


AREA OVERVIEW

DEMOGRAPHIC Population Land Area: Square Mile Median Age Workforce Participation Median Household Income Poverty Rate

134,385 108.98 34 67.3% $57,603 16.3%

HOUSING DATA Households Median Home Sale Price Upper Peninsula Downtown Charleston Daniel Island

8,264

West Ashley Area

20,273

James Island Johns Island

3,034

Median Gross Rent

$485,350 $962,500 $849,900 $309,000 $371,000 $327,500 $1,695 $1,052

13.0%

CHARLESTON MUNICIPAL REPORT

INDUSTRIAL OFFICE

COMMUTE PATTERNS In Area Laborforce Efficiency

Greater Charleston Inventory Vacancy Rate Asking Rent Downtown Charleston Inventory Vacancy Rate Asking Rent

RETAIL

JAMES / JOHNS ISLAND

* See Submarket Maps section

COMMERCIAL REAL ESTATE

Downtown Charleston Inventory Vacancy Rate Asking Rent

1,913,377 sq ft 4.1% $13.43 4,771,626 sq ft 3.1% $42.22 1,760,117 sq ft 2.6% $46.36

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

Median Mortgage Cost

53,348


HIGHLIGHTS

DEVELOPMENT TIMELINE PROJECTIONS

• Higher than average poverty rate somewhat offset by high workforce participation • Despite significantly higher asking rents on the Peninsula (more than double for retail and almost a third higher for office), vacancy rates are significantly lower than the region’s averages. Parts of the Peninsula are experiencing modest job loss

SINGLE FAMILY

• Median home prices range from the marginally affordable to the region’s most expensive. CONSULTANT LOW

32 47

GOVERNMENT CONSULTANT HIGH

72 0

• All in-area labor force efficiency ratios, other than the Peninsula, create significant transportation congestion

10

20

30

40

50

60

70

80

WEEKS

PARTNERSHIP PRIORITIES • Support implementation of housing policy reforms to promote affordability and diversity of housing options

MULTI-FAMILY

• Development timelines are well above regional averages CONSULTANT LOW

38 34

GOVERNMENT CONSULTANT HIGH

72 0

10

20

30

40

50

60

70

80

• Continue business community engagement in completion of targeted priorities included in the West Ashley Revitalization Plan

WEEKS

• Engage Developers Council to provide continued feedback on implementation of Technical Review Committee process changes • Continue participation on Sustainability Advisory Committee to ensure business input on issues like flooding

COMMERCIAL

• Examine and promote transit-oriented development opportunities related to Lowcountry Rapid Transit

CONSULTANT LOW

30 34

GOVERNMENT CONSULTANT HIGH

72 0

CHARLESTON

10

20

30

40

50

60

70

80

WEEKS


SUBMARKET MAPS COMMERCIAL REAL ESTATE

INDUSTRIAL

OFFICE

RETAIL

DORCHESTER COUNTY

DOWNTOWN CHARLESTON

DANIEL ISLAND | CLEMENTS FERRY

DOWNTOWN CHARLESTON

EAST SUBURBS

DOWNTOWN CHARLESTON

EAST COOPER | CLEMENTS FERRY

NORTH CHARLESTON

EAST ISLANDS | MOUNT PLEASANT

EAST ISLANDS | MOUNT PLEASANT

NORTH SUBURBS

GOOSE CREEK

GREATER CHARLESTON

WEST SUBURBS

NORTH CHARLESTON | HANAHAN

NORTH CHARLESTON

SUMMERVILLE | LADSON

OUTLYING BERKELEY COUNTY

WEST ASHLEY

WEST CHARLESTON COUNTY

WEST ISLANDS


NEXT STEPS THROUGHOUT THE YEAR The identified partnerships will be pursued by Chamber staff with assistance and direction from the Developers Council. Quarterly progress reports will be presented to the Developers Council by staff. Constant dialogue with political and governmental agency leadership will identify additional partnership opportunities. In December 2019, we will report refreshed data successes realized and areas of needed focus.

CHARLESTON METRO CHAMBER OF COMMERCE With approximately 1,600 member organizations representing 160,000 professionals, the Charleston Metro Chamber of Commerce serves as the collective voice of the tri-county business community, and a catalyst for regional economic advancement and member success.

DEVELOPERS COUNCIL Comprised of Charleston Metro Chamber members involved in real estate development, land use management and project planning, design and construction, the Developers Council’s purpose is to identify and promote best practice policy and process improvements to make residential and commercial development not only more time and cost efficient, but responsive to the needs of the community.

Regional job growth projections (2017-2022): EMSI with adjustments by the Center for Business Research, Charleston Metro Chamber of Commerce, as reported in the 2018 Charleston Region Talent Demand Study www.charlestonregionaldata.com Population estimates for all geography levels: U.S. Census Bureau Population projections: Center for Business Research, Charleston Metro Chamber of Commerce Demographics such as age, income, poverty rates, median mortgage cost and median gross rent: U.S. Census Bureau’s latest five-year American Community Survey data (2016, the latest available at the time of this study) Job counts by ZIP code: ZIP Business Patterns series of the U.S. Census Bureau Commuting patterns and labor force efficiency rates: US Census Bureau’s On The Map tool, showing 2015 data, the latest available in 2018 when this study was conducted Housing units permitted and projected housing units needed: Calculated by the Center for Business Research, Charleston Metro Chamber of Commerce, using historical data from U.S. Census Bureau Data on home sales (units and prices): Charleston Trident Association of Realtors (2017 annual report and Local Market Updates-November 2018) Commercial real estate data: Latest quarterly reports from Avison Young www.avisonyoung.us All data on the development process within jurisdictions: Primary research conducted by the Chamber’s Government Relations team in conjunction with the Center for Business Research Data on traffic congestion: Berkeley-Charleston-Dorchester Council of Governments (BCDCOG), serving as the Charleston Area Transportation Study metropolitan planning organization (CHATS MPO), Congestion Management Process report, November 2018 (DRAFT)

INVESTMENT OPPORTUNITY STUDY: A PLATFORM FOR DATA-DRIVEN COLLABORATION CHARLESTON METRO CHAMBER OF COMMERCE : JANUARY 2019

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DATA SOURCES


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