Downtown residential consultant says market has expanded
07/17/2014 6:08 PM
07/18/2014 9:59 AM
Editor's note: This story has been changed to correct the percentage of people who, according to a 2010 report, preferred to rent, rather than own, a home.
A consultant hired more than four years ago to research the downtown housing market has updated her original report and says the area can absorb a lot more residential housing.
Laurie Volk of New Jersey-based Zimmerman/Volk Associates said Thursday that downtown Wichita could support between 1,425 and 1,870 additional units in the next five to seven years.
In her 2010 report, Volk projected downtown could absorb 1,000 units – a number that she and Wichita Downtown Development Corp. officials said has already been achieved.
“I was astounded,” Volk said of the results of her data for the new report. “There is a significantly larger market for housing in downtown Wichita.”
She said much of the demand for downtown housing – 76 percent – will be younger singles and childless couples, primarily millennials. The report also said 16 percent of those households will be empty nesters and retirees, and 8 percent will be traditional and nontraditional families.
The report also noted a significant change in market preferences for renting versus buying residential units. The 2010 report projected 30 percent of the market would prefer renting instead of buying. Volk said her new report shows the overwhelming preference – 65 percent – will be renting.
She said that’s driven by a number of factors, including the preferences of millennials who don’t want to purchase a home or can’t get a mortgage because of their debt load.
Volk said data for the report included information from the Internal Revenue Service, to track migration within the city and from outside it, as well as data from the Census Bureau’s American Community Surveys.
She said she thinks the additional demand is driven largely by the new residential units that have been added downtown since her first report.
“That’s really what happens,” Volk said of downtown residential development spurring additional demand. Volk has been consulting to downtowns since 1988, including in St. Louis and Detroit.
According to information from the WDDC, there are 900 existing residential units downtown, and more than 700 planned or under development.
The 1,000 units that Volk’s 2010 report projected have nearly been achieved by projects such as the 85-unit Lux apartments at First and Market and the 36-unit Corner 365 apartments at First and Waco.
Jeff Fluhr, WDDC president and CEO, said that figure also includes planned projects such as the 154-unit River Vista apartment, office and retail project planned downtown on the west bank of the Arkansas River and the 133-unit apartment complex Jack DeBoer constructed at McLean and Maple.
He said updating these studies serves to encourage additional private sector development downtown. Updated reports give developers information they need to decide whether to proceed on projects and what kinds, how big they should build them, and what kind of rents they should charge.
“So we do expect we will have more projects, as we have had in the past,” Fluhr said.
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