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CONCLUSIONS AND RECOMMENDATIONS <br /> TABLE 15 <br /> AFFORDABLE INDEPENDENT SENIOR HOUSING DEMAND <br /> ELK RIVER MARKET AREA <br /> 2012&2017 <br /> Age of Householder Age of Householder <br /> 55-64 65-74 75+ 5544 65-74 15+ <br /> Households w/Incomes of$20,000 to$39,540/$22,600 to 44,7002 516 378 = 470 511 398 456 <br /> (plus)Households w/Incones of Sin-$20k/$17k-$22.6k 82 188 157 54 108 146 <br /> (times)Homeownership R a t e x 9 2% 88% 73% x 9% 88% 73% 'f <br /> (equals)Potential Market = 75 165 115 = 49 95 107 <br /> (equals)Potential Market Base by Age 591 213 355 560 303 349 <br /> (times)Potential Short Term Capture Rate x 1.5% 10.0% 20:0% x 1.5% 10.0% 20.0% <br /> (equals)Demand Potental 9 21 71 8 30 70 <br /> Total Market Rate Demand Potential 101 109 <br /> (plus)Demand From Onside the Market Area(25%) + 34 + 36 <br /> (equals)Total Demand Potential for Affordable Senior Housing in Market Area 135 145 <br /> (minus)Existing&Pending Affordable Senior Units In Market Area' 0 0 <br /> (equals)Total Market Area Affordable Senior Housing Demand Potential = 135 = 145 <br /> Proposed number of units at Blackhawk Woods 84 84 <br /> Units occupied by PMA residents(7591),at 9596 occupancy 60 60 <br /> Project Penetration Rates 5.2% 4.9% <br /> Gross Market Penetration Rate 5.2% 4.9% <br /> '2017 calculations adjusted for inflation(2.5%annually) <br /> Competitive affordable senior units(non subsidized)minus a 5%vacancy rate. <br /> 3The number of units at Blackhawk Woods at stabaiized occupancy(95%)divided by the number of income-qualified households <br /> 'Units at Blackhawk Woods at stabalzed occupancy(95%)plus Ws-ling/pending units at 95%occupancy divided by the total number of age/income- <br /> qualified households <br /> Source: Maxfield Research Inc. <br /> Some additional demand will come from outside the Elk River Market Area. We estimate that <br /> 25%of the demand for independent affordable senior housing will be generated by seniors <br /> currently residing outside the Elk River Market Area. This demand will consist primarily of <br /> parents of adult children living in the Elk River area,individuals who live just outside of the Elk <br /> River Market Area and have an orientation to the area,as well as former residents who desire <br /> to return. Together,the demand from Elk River Market Area seniors and demand from seniors <br /> who would relocate to Elk River results in a demand for 135 affordable active adult units in <br /> 2012. <br /> Next,we subtract existing competitive affordable units(minus a vacancy factor of 5%to allow <br /> for sufficient consumer choice and turnover)from the demand. However,since there only <br /> subsidized or market rate senior products in the Elk River Market Area we do not subtract any <br /> competitive units. Therefore,demand remains at 135 affordable senior units in the market <br /> area: <br /> Adjusting for inflation,we have estimated that households with incomes of$22,600 to$44,400 <br /> and homeowners with incomes of$17,000 to$22,600 would be the primary target market for <br /> affordable senior housing in 2017. Considering the growth in the older adult base and the <br /> income distribution of the older adult population in 2017,the methodology projected that <br /> demand will increase to 142 units by 2017. <br /> • <br /> MAXFIELD RESEARCH INC. 55 <br />