Fire 378 project outline summary
Urban living has evolved from traditional housing to mixed living, with many cities adopting the changes. St. Cloud city is among the cities trying to cope with the high housing demands for its residents. Offering a viable solution would require us to come up with a product that addresses the needs of the residents in the locality. Development land is available along St. Lincoln street, next to U-Haul storage location, and a former Burger King on the East side of St. Cloud. Located next to Route 10 and Division Street, the area is a promising work and living area; hence setting a mixed live/work plaza is the way to go.
The SWOT analysis gives us more assurance on the viability of the project. The fact that the proposed development of land is located next to major roads with high traffic density, and that there exist no other similar structure puts us ahead. Despite there being a limited room for future expansion and the need to resettle homeowners, the area offers an opportunity for redevelopment. The threat at hand is that other developers might want to venture into similar establishments before we set up the development.
Our proposed development area is approximately 5.75 acres and was listed for sale over a year ago. Because it has not attracted many buyers over the period, we have a bargaining power to negotiate the set price. Funding challenges might require us to seek assistance from the city authorities who are in support of developing the East side of St. Cloud. We will also incur some demolition costs for the setup. Other prices include buying the U-Haul and Burger King premises, purchasing land costs and construction estimated costs totaling up to 9.935 million dollars.
The main advantages of the site include cheaper land acquisition costs, well-built infrastructure, availability of potential clients, proximity to major amenities and hotels, access to city development funds, among others. Our main limitations are the lack of room for expansion and costly demolition costs. The proposed plaza is a four-story building set to house business spaces on ground floors and 75 residential apartments on the upper floors. The resident has the advantage of accessing businesses, laundry services, and parking amenities. The housed businesses will consist of balanced cultures in the population with diverse suitable businesses.
When we evaluate the target customer base for our amenities, we have a population of approximately 68000 consisting of mainly the medium-aged. The available houses supply only 51.7% of the people; hence there is a housing gap that provides a demand for our development. The project will address the need for the people working in the area, as they would prefer staying nearby. Since most of the people walk to and from work, advertising by word of mouth is easier. Social media will also play a part when sourcing for our clients.
Our competitive advantage is that the main competitors, such as Castle Realty, established in 1982, only offer premises on buy/sell terms, but leasing is our option. Therefore, the customers who are still unable to buy can always acquire houses at affordable leasing rates. By carrying out market research comparing the available market rates as new investors, it gives us an advantage, to offer excellent prices.
In conclusion, the real estate development project of a four-story building serves as the perfect solution to the housing demands of the East side of St. Cloud. With the necessary funding and full approval of the city development authorities, the project is deemed a big success. Well organized infrastructure and available amenities will attract clients. Though there is limited room for expansion, if the project kicks off well, it will offer an opportunity for more developments in the future. Other suitable projects would be a gas station, a midscale restaurant, a gas station, or a commercial plaza.
Competitive grid analysis guidelines
| ● positive | ● negative | |
| Neighborhood adjustments | ● High Traffic Area ○ On the Corner of Division St (Rt 23) and in very close proximity to Rt. 10 ● The land is being underutilized Current Use is A vacant Restaurant and a U-Haul Self-Storage | ● Proximity to Target might impact Retail Demand ● Near Train Tracks ○ Might Impact Residential Demand ● |
| Land value adjustments | ● Section of the land has been vacant for over a year ○ Can probably get a significant discount
● Land working costs will be limited.
| ● Might be expensive to resettle U-Haul ● Limited expansion unless we relocate residents, or eminent domain
|
REFERENCES
Castle Realty. (2020, February 25). Castle Realty. Retrieved from Castlereal: http://www.castlereal.estate/
United States Census Bureau. (2010, April 1). St. Cloud city, Minnesota. Retrieved from Census.gov: https://www.census.gov/quickfacts/fact/table/stcloudcityminnesota/IPE120218