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HomeMy WebLinkAboutItem 01 - Development Issues Workshop mim W b • ___ MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL ."7 FROM: ROGER NELSON, CITY MANAGER U' MEETING DATE: NOVEMBER 30, 2004 SUBJECT: DEVELOPMENT ISSUES WORKSHOP The workshop on November 30th will focus on development issues facing the City at this time. Specifically, we will be looking at the Master Plan and areas that may need to be amended, vacant commercial property available for development and historic preservation in the coming years. MASTER PLAN A map of the community with an overlay of the Master Plan's designations is included for your review as is a zoning map. There are several areas where the current Master Plan does not agree with the manner in which staff is pursuing development opportunities. For example, the Trencor site is planned and zoned for Light Industrial. In discussions with developers in recent months staff has pointed them towards retail/tourism commercial instead of industrial. The disconnect between what we believe to be the current thrust for the development of different pieces of property and the Master Plan's designation makes this an issue where we are asking for direction from the Council. For the most part, the Master Plan and the zoning maps agree with each other as Grapevine has done a very good job of keeping the map up to date with the zoning. Please review the plan at your leisure prior to the 30th as it is likely that there may be areas you would like to see us address that we are not considering. UNDEVELOPED PROPERTIES In 2001 I presented a map of undeveloped or available properties in the community for discussion at a workshop. That map has changed to some extent since the last time we reviewed it and several maps of these areas are also included in the packet. Tommy Hardy and I will discuss some additional issues that we are aware of that are affecting our economic development position. HISTORIC PRESERVATION The big book that is included in the packet is a preliminary draft of the Historic Structures Survey. The survey catalogues every principle structure built prior to 1964. Obviously, the houses built between 1955 and 1964 are not 50 years old, but including them in the report does give us a tool as we look ahead at preservation and protection issues. At the workshop we hope to discuss the Council's position regarding the preservation of homes and neighborhoods that are approaching or tipping over the 50 year mark. November 23, 2004 (4:16PM) Hoe'813 2884 89:88;43 Via Fax -> 8174103818 H. T. Hardy Page 881 Of 882 ______:_ t4rit. gra 0.06( ,-,7 B_ , ,," �--;F `a? _EL E ,1 ''-;=�Y VOL. 9. NO, 42 Nov. 8 2004 RETAIL REIT INDEX 1 Oct. sales end tepid trend, up 4.1% ' in best performanceMay sooSame-store sales were up a strong 4.1%in October,partially lifted S'0 - - " ' by demand for replacement goods after the four hurricanes that hit 500 _�� _ - Florida this year,according to ICSC Research,which tallied 75 460 1 chain stores.This follows several months of tepid sales and is the ma retail sector's strongest performance since May,when same-store see - �„�- r`✓ - ,,0 ,,,,,,�w sales rose a hearty 5.7%.Specialty apparel and luxury retailers en- , ..* n- - centersjoyed the month's best gains.The specialty apparel group rose no - --actory wiles 9.2%.Luxury retailers also saw a 9.2%increase.Among specialty zao — __» _..............,.._.......-..-.--.-..-•-....-4 apparel chains,American Eagle Outfitters posted 292%growth, 150 - ass s aa 3 s a o $ its biggest gain of the year.Among luxury retailers,Neiman ar- a - V w C a 1t, a - a i cus reported a 13.6%increase.Wholesale clubs did fairly well too, rising 6.6%.Costco had the best showing in this group,with gains Soarer Smith Baru,/ of 8%.Discount stores were up only 3.2%.T.J.Maxx led this group,with 7%growth.Wal-Mart rose just 2.4%. For the week ended Oct.29,the regional mall index was at 560.7, up 1.41%; the strip center index (including power, neighborhood and Community centers) was at DDR pays $1.5B to enter Puerto Rico 440.1,up 2.50%;the tactory outlet index was at 484.6,up 0.77%; and the S&P 500 index was at 211.1, up 3.20%, The portfolio of 15 Puerto Rican shopping centers that Develop- from the previous week. ers Diversified Realty bought from Caribbean Property Group The Mal REIT index was dors inial by Smiin Barney torSCT Xta.The index s based c,total mans,na dividends.sawing ata tunas 1000000c. last week is high quality,which should offset concerns about the 31,1995.The chef is updated wreW. low cap rate,writes Morgan Stanley analyst Matthew Ostrower in a report.The$1.15 billion deal,which the parties expect to close ACG Equities and Bush Re- during the first quarter,comprises about 5 million sf and bears a TRANSACTIONS: cap rate of 7.4%.The portfolio,whose major tenants include alty Associates bought tlx: 288.(100 sf Richmond Caribbean Cinemas,Gap,Kmart and Wal-Mart,is currently (Ky.) Mall. for $20 million from Madison Realty 97%leased.To finance the deal,DDR raised$300 million Group. •Inland Western acquired the 102,836-sf through the sale of its joint venture neighborhood centers. Plaza at Riverlakes, Bakersfield. Calif., from Schribner Realty Group for $17 million. • Re- gency sold an outparcel at Pelham comm Shop- Vornado mum on plans for Sears stake ping Center, Greenville, S.C., to Wash Me Au- Vornado Realty Trust has acquired a 4.3 percent stake in Sears towash for $250,000. • RP Properties sold the for about$338.1 million.Sears shares jumped 25%after the 334,955-si Village Square,Northbrook,Ill.,to four announcement.Vornado did not reveal its intentions.But the New entities led by Principal Mutual.The buyers paid York City-based REIT may force Sears to capitalize on its$8.7 $91 million.•Grosvenor bought a460,000-sf port- billion portfolio of mall real estate,analyst say,by selling its folio of 15 retail properties in the Washington.D.C., stores or converting them to other uses.The value of Votnado's area from various subsidiaries of Starwood Urban. Sears stock could rise if the REIT succeeds in boosting Sears' $188 in sales psi to about$400 psi.This could be done by WANT SCT XTRA IN COLOR? refocusing new store development and operations away from malls,says Prudential Securities analyst Wayne Hood.But To sign up for e-mall delivery,visit www.iesc.org Michael Exstein,a Credit Suisse First Boston analyst,sees the buy and click the "Publications' tab. Then click as an investment,not a real estate play.Sears owns 519 stores,or "SCT Xtra' 59%of its total portfolio. SCT Newswire Economy strong but needs watching, ICSC Western Conference speakers say Times are good for the shopping center industry,said speakers at this year's ICSC Western Division Conference& Deal Making,though some voiced concerns about threats to the economy.The meeting concludes today in Palm Springs,Calif. With U.S. interest rates still low,employment levels rising and shoppers spending,"it is a great time to be in our industry,"said Pat Donahue,president of ICSC's Western Division and also president of Costa Mesa,Calif.-based Donahue Schriber.Even a spate of store closings by the likes of Gadzooks,KB Toys,Toys'R'Us and Wilson's are being offset by store openings,Donahue told his audience. The U.S.economy will probably grow between 3.5 and 4 percent over the next 18 months,said Gary Schlossberg, senior economist at Wells Fargo Bank,San Francisco.That is weaker than expected for this midexpansion point in the economic cycle,he said,"but we are still a long way from what we see as a recession." Mall net-asset values have risen at a handsome rate,said Mike Kirby,a principal and co-founder of research firm Green Street Advisors,Newport Beach,Calif.But the same factors that are boosting business now could also be creating a bubble waiting to burst. "We are now in a recovery that looks fine on paper,but it depends on who you're talking to,"Kirby said. Some businesses remain reluctant to hire,preferring to stockpile cash,he said.Besides this,he added,household debt levels are at all-time highs,while personal savings levels are very low. "As I look forward,I see an environment that is very risky-much riskier than five or seven years ago,"said Robert Edelstein,co-chairman of the Center for Real Estate at the University of California Berkeley's Hass School. Interest rate rises could hurt household income and wealth levels as home values decline,Edelstein said.Among the other possible negatives are global trade and energy issues as well as terrorism,he said.New energy sources will be necessary as increasing Asian demand puts pressure on existing oil reserves.Further,political instability in such countries as Argentina,Brazil,Indonesia,Pakistan,the Philippines and Russia could work mischief on the world economy. Domestically,the federal budget deficit is a concern,as are budget shortfalls in most U.S.states,Edelstein said.The trade deficit,too,"is a problem that needs to be corrected,"he added. More than 4,000 retail real estate professionals attended the meeting,a 15 percent increase over last year. Compiled by the staff of Shopping Centers Today. ©October 07,2004 International Council of Shopping Centers. SCT Newswire Gas prices won't spoil Christmas season, survey says Despite higher gasoline and oil prices,U.S.consumers will spend more on Christmas gifts this year than they did last year,according to a phone survey of 1,018 adults commissioned by ICSC and UBS. Respondents said they'll spend$703 on average this holiday shopping season,more than the$636 they cited last year.And 63 percent said rising gas prices will not affect their expenditures. Men are expected to spend more($789)than women($622),and department stores will be the most popular venues, with 46 percent of those surveyed expecting to shop there. Sixty-two percent said they plan to buy at least one gift card. Sixty percent said they have completed less than half of their holiday shopping already,while 11 percent said they'd wait until the week after Thanksgiving to hit the stores.Fourteen percent still haven't decided where they will shop. This year Christmas retail sales will grow by about 3 percent to 4 percent,versus the 6 percent growth achieved in 2003,says Michael Niemira,ICSC's chief economist and director of research. Compiled by the staff of Shopping Centers Today. ©November 12,2004 International Council of Shopping Centers. Newswire September comp-store sales continue soft trend Same-store sales were up only 2.4 percent in September,compared to a 5.9 percent gain last year,according to the ICSC Research Department,which surveyed 71 chain stores. A slow back-to-school season and unusually warm weather contributed to the soft showing,says Michael P. Niemira,ICSC's chief economist and director of research. The hurricanes in the South played a part but were not a negative factor for all retailers,he adds.Federated and May, for example,reported sales losses,but BJ's Wholesale Club said it had to replenish shelves more frequently as shoppers stocked up on staples to ride out the storms. Drugstores and wholesale clubs posted the best average sales growth for the month,with gains of 7.1 percent and 6.6 percent,respectively.Walgreens continued a growth streak,with 9.3 percent sales growth,while BJ's posted an 8.3 percent gain. Department stores reported a 0.7 percent drop.Some high-end chains bucked the trend,though,with Neiman Marcus posting 6.3 percent growth and Nordstrom reporting a 6.2 increase. Saks experienced the sector's largest decline,dropping 4 percent. Not counting Gap,which slid 3 percent for the month,specialty apparel stores sales were flat.American Eagle Outfitters led the sector with a jump of 23.3 percent.In general,footwear stores continued their hike through negative territory,declining an average of 3.4 percent.Of the shoe shops surveyed,only Famous Footwear enjoyed a gain,at 4.7 percent. Discounters gained 2.5 percent overall.Target led here,with 5.6 percent growth,while Dollar General posted a gain of 4.2 percent.Wal-Mart's sales rose 2 percent. Despite their softness compared to a year ago,September's sales did represent a noticeable uptick from August's 1.3 percent gain.October sales will likely strengthen,Niemira says,to a rate of 3 to 4 percent. Compiled by the staff of Shopping Centers Today. ©October 08,2004 International Council of Shopping Centers. SCT Newswire Shopping center vacancies down, rents up, survey says Vacancy rates in U.S.malls and open-air centers dropped to their lowest points in a year and a half,while rents edged up,according to a preliminary third-quarter study by New York City—based Reis,a real estate research firm. Third-quarter mall vacancies slid to 5.5 percent from 5.6 percent in the second quarter,while mall rents rose 0.2 percent to$37.67 per square foot,Reis told The Wall Street Journal. Escalating construction costs have kept retail construction in check,which helped subdue vacancy rates,Reis Senior Consultant Andrew Wright told SCT Newswire. Open-air centers posted good numbers too.Asking rents for this format rose 0.9 percent for the quarter,to$17.48 per square foot.The vacancy rate among these centers was 6.9 percent,down slightly from the second quarter's 7 percent.The current vacancy rate is just one percentage point above the historic low of 5.9 percent,which the sector achieved in the fourth quarter of 2000. The Reis study surveyed the 62 biggest U.S.retail real estate markets. Compiled by the staff of Shopping Centers Today. ©October 21,2004 International Council of Shopping Centers.