U NIVERSITY A VENUE P ROPERTY T AX S TUDY: Part 2: R ELATIONSHIP B ETWEEN L AND U SE & P ROPERTY T...

UNIVERSITY AVENUE PROPERTY TAX STUDY:Part 2:RELATIONSHIP BETWEEN LAND USE & PROPERTY TAX REVENUE

UNIVERSITY AVENUE PROPERTY TAX STUDY:

Part 2:RELATIONSHIP BETWEEN LAND USE & PROPERTY TAX REVENUE

Bob Spaulding • November 1st, 2006

Bob Spaulding • November 1st, 2006

MIDWAY STUDY AREA: DEFINED MIDWAY STUDY AREA: DEFINED

TAX STUDY | HOW LAND USE IMPACTS TAX REVENUE

Total land valuation for study area: $100,420,800

Median Value per square foot: $19.85/square foot

Highest Value per square foot: Skyline Tower and parking lots, $27.83/sq. ft.

Lowest Value per square foot: Warehouse, 413 Lexington Pkwy, $3.77/sq. ft.

Source: Compiled Data from Ramsey County Records & Revenue Department

FLOOR AREA RATIO (FAR): DEFINED FLOOR AREA RATIO (FAR): DEFINED


Source: Met Council Diagram

FAR of 0.5

FAR of 1.0

FAR of 1.5

Floor Area Ratio =

Building Space Square Footage

Land Square Footage

Floor Area Ratio (FAR) is a measure of development density. Higher FARs equate to

more dense development of a parcel.

CASE STUDIESCASE STUDIES



.51$36/sq ft$1.15/sq ft59% full

Floor Area Ratio (FAR):Assessed Valuation

(2007): Tax Yield (2006):

Parking Usage at Peak:

2.12$84.35/sq ft$2.11/sq ft


(2007): Tax Yield (2006):

1435 University Avenue

Prior & University Avenues

MENARD’S

W. E. MOWREY CO.




.36$83/sq ft$1.46/sq ft33% full


(2007): Tax Yield (2006):


.38$59/sq ft$1.32/sq ft59% full


(2007): Tax Yield (2006):


WESTERN BANK

CVS PHARMACY

663 University Avenue

Snelling & University Avenues




1.36$52.38/sq ft$1.47/sq ft47% full


(2007): Tax Yield (2006):


.19$28/sq ft96¢/sq ft44% full


(2007): Tax Yield (2006):


AUTO ZONE1075 University Avenue

NE BLOCK AT UNIVERSITY & SNELLING




.37$33.25/sq ft92¢/sq ft375,992 sq ft


(2007): Tax Yield (2006):

Land Square Footage:

2.86$81.99/sq ft$2.83/sq ft6,098 sq ft


(2007): Tax Yield (2006):

Land Square Footage:

MIDWAY BOOKS

TARGET

Snelling & University Avenues

Hamline & University Avenues

FAR’S RELATIONSHIP TOVALUE PER SQUARE FOOT (2006)




The higher the density, the greater the value per square foot of land overall.

$-

$20

$40

$60

$80

$100

$120

$140

$160

0 0.5 1 1.5 2 2.5 3 3.5 4

Floor Area Ratio (FAR)

Assessed Value per Square Foot





Floor Area Ratio (FAR) Total Property Value in Study Area

Current FAR of .72 $199 million

if we increase FAR to 1…

$233 million


$363 million


$493 million

Floor Area Ratio (FAR) Property Values per Square Foot

Current FAR of .72 $41.31/square foot


$48.36/square foot


$75.40/square foot


$102.17/square footApplying the Principle to the Full Study Area…

The Basic Principle…

FAR’S RELATIONSHIP TOANNUAL TAX YIELD PER SQUARE FOOT (2006)




The higher the density, the greater the tax yield per square foot of land overall.

$0

$50

$100

$150

$200

$250

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50


Property Tax Yield per Square Foot





Floor Area Ratio (FAR) Property Tax Yield for Study Area

Current FAR of .72 $4.91 million


$5.74 million


$8.63 million


$11.58 million

Floor Area Ratio (FAR) Property Tax Yield per Square Foot

Current FAR of .72 $1.00/square foot


$1.17/square foot


$1.76/square foot


$2.36/square footApplying the Principle to the Full Study Area…

The Basic Principle…

TOTAL OPPORTUNITY COSTS OF NOT DEVELOPING MIDWAY TO ITS FULL POTENTIAL

(Summary of Conclusions)

TOTAL OPPORTUNITY COSTS OF NOT DEVELOPING MIDWAY TO ITS FULL POTENTIAL

(Summary of Conclusions)




Total Market Value

Total Annual Taxes

existing FAR of .73 $199 million $4.91 million


$233 million $5.74 million





AVERAGE ASSESSED VALUE BY USE Value per Square Foot of Land Area

AVERAGE ASSESSED VALUE BY USE Value per Square Foot of Land Area



$46

$38

$25

$23

$27

$33

$11

$0 $10 $20 $30 $40 $50

Hamline-MidwayHomes

Office

Industrial

Auto-Related

Food-Related

Retail

Vacant

Industry Close-Up Look:

FAST FOOD VERSUS CONVENTIONAL FOOD Industry Close-Up Look:

FAST FOOD VERSUS CONVENTIONAL FOOD



6 properties

6 drive-thrus

200,000 square feetland area

20,000 square feet of building

Average FAR: 0.102

9 properties

No drive thrus

61,500 square feet land area

71,100 square feetof building

Average FAR: 1.20

FAST FOOD CONVENTIONAL FOOD

Industry Close-Up Look:

FAST FOOD VERSUS CONVENTIONAL FOOD Industry Close-Up Look:

FAST FOOD VERSUS CONVENTIONAL FOOD



$5,000,000 total assessed valuation

Average Value per square foot: $25.79

Average Tax Yield per square foot: 77¢

Land four times as valuable

as buildings

$3,900,000 total assessed valuation

Average Value per square foot: $65.28

Average Tax Yield per sq. ft.: $1.93

Building twice as valuable as land

FAST FOOD CONVENTIONAL FOOD

U NIVERSITY A VENUE P ROPERTY T AX S TUDY: Part 2: R ELATIONSHIP B ETWEEN L AND U SE & P ROPERTY T...

Documents

Transcript of U NIVERSITY A VENUE P ROPERTY T AX S TUDY: Part 2: R ELATIONSHIP B ETWEEN L AND U SE & P ROPERTY T...