4.1. SR 08-11-2008 - Laserfiche WebLink

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EXECUTIVE SUMMARY Introduction Maxfield Research Inc. was engaged by the City of Elk River to conduct market research and provide analysis regarding current market conditions and the potential demand for retail and industrial space at the Gateway Business Center. The scope of this study includes an assessment of the Gateway .Business Center as a site for highway retail and light industrial uses; an analysis of the relevant demographic growth trends and characteristics affecting retail demand and industrial demand in the azea; an assessment of retail and industrial development trends and current market conditions; and a projection of demand for these uses that could potentially be captured by the Gateway Business Center. Retail Conclusions The following bullets summarize our findings for retail uses at the Gateway Business Center. - The parcels designated for retail use at the Site suffer from access and visibility issues. ' The northwestern portion of the Gateway Business Center would have better access, due to its proximity to 171st Avenue, but visibility is less than desirable because of the distance to Highway 10. This area might have some marketability for destination retailers. However, because there aze several developable parcels in the immediate azea that have better visibil- ity, retailers would be more attracted to these sites. ~ The southwestern portion of the Gateway Business Center would have good visibility from Highway 10. However, the access is poor. Customers would have to exit at 171st Avenue, continue south on a proposed connector road, and finally tum down an access road or cul- de-sac. We believe retailers would find this access too burdensome for customers, making these parcels uncompetitive in the mazket. If access could be improved through the devel- opment of an intersection at 167th Avenue, this parcel would have better market appeal. - The retail market is strong in the Elk River Mazket Area, primarily driven by household growth. The overall vacancy rate for competitive properties is about 10%, which is comps- rable to the northwest Metro Area as a whole. - Most potential retailers, however, would prefer to locate along the Highway 169 retail corridor north of the Site. Other competitive sites in Ramsey, Otsego, and Rogers would also impact demand at the Gateway Business Center. The overall competitive mazket fur- ther reduces demand at the Site and ultimately would result in lower lease rates achievable at the Site. - Based on our Site analysis, demographic analysis, competitive market analysis, and inter- views with retail brokers, we find demand for about 4,000-square feet of additional retail be- tween 2008 and 2015. i MAXFIELD RESEARCH INC.