2019 Spring Leadership Land Use Policy Subcommittee Packet

Land Use Policy Subcommittee 2019 Spring Leadership Meeting Thursday, June 6th, 10:00 AM – 12:00 PM Marriott Wardman Park Hotel, Washington 2, Exhibition Level

Chair: Michael Fazio Staff: Debra Bassert Vice Chair: Don Whyte Staff: Alexandra Isham

Agenda

I. Call to Order Michael Fazio

II. Approval of the 2019 IBS Meeting Minutes Michael Fazio

III. Reports and Discussion Items

a. Fixing the Inclusionary Zoning Calculator Tool Paul Emrath

b. Alliance for National and Community Resilience (ANCR) Paul Emrath Standards on Community Resilience

c. Possible Survey on Costs of Architectural Design Standards Paul Emrath

d. HBA of Chicago Research on Solving Housing Affordability Paul Colgan

IV. Land Use Policy Issues Roundtable Michael Fazio

2019 Land Use Policy Subcommittee

Jim Chapman Paul Kane Jim Chapman Homes, LLC HBA Raleigh-Wake County 2700 Cumberland Parkway SE, Suite 130 5580 Centerview Drive, Ste 115 Atlanta, GA 30339 Raleigh, NC 27606 (770) 434-3602 (919) 233-2033 Email: [email protected] Email: [email protected]

Laura Comek Craig Karn Laura M. Comek Law LLC Consilium Design, Inc. 501 S. High Street 7353 S. Alton Way, Ste 135 Columbus, OH 43215 Centennial, CO 80112-2304 (614) 560-1488 (303) 224-9520 Email: [email protected] Email: [email protected]

Shawn Cote Jon Luther Southern Arizona HBA HBA of Greater New Orleans 2840 N. Country Club Road 2424 N. Arnoult Road Tucson, AZ 85716 Metairie, LA 70001 (520) 795-5114 (504) 837-2700 Email: [email protected] Email: [email protected]

Michael Dey Frank Murphy HBA of Greenville Wynne Jackson, Inc. 5 Creekside Park Court, Ste A 600 N. Pearl Street, #650LB149 Greenville, SC 29615 Dallas, TX 75201-2812 (864) 254-0133 (214) 536-1900 Email: [email protected] Email: [email protected]

Michael Fazio (Chair) Jim Perras Woodrow Estates Home Builders & Remodelers Association 3225 Victory Blvd. of Connecticut Staten Island, NY 10314 435 Chapel Rd., Suite B (718) 370-9677 South Windsor, CT 06074 Email: [email protected] (860) 500-7796 Email: [email protected] Wesley Galyon Wichita Area BA David Pressly 730 N. Main Street Pressly Development Co., Inc. Wichita, KS 67203 1109 Davie Avenue (316) 265-4226 Statesville, NC 29677 Email: [email protected] (704) 872-1000 Email: [email protected] Gary Hill Tradition Homes Bill Sanderson 30 Cape May Pt. Urban Community Developers, Inc. Greensboro, NC 27455-1363 100 E. RiverCenter Blvd., Suite 1100 (336) 420-5893 Covington, KY 41011 Email: [email protected] (859) 292-5505 Email: [email protected]

Lamar Smith Lamar Smith Signature Group 152 Thunderbird Drive, Ste 207 Richmond Hill, GA 31324 (912) 445-0932 Email: [email protected]

Don Whyte (Vice Chair) Deseret Cattle & Citrus 13754 Deseret Lane St. Cloud, FL 34773-9381 (321) 301-0852 Email: [email protected]

LAND USE POLICY SUBCOMMITTEE REPORT

NOT FOR PUBLICATION

FOR THE INFORMATION OF THE NAHB SENIOR OFFICERS, EXECUTIVE COMMITTEE AND BOARD OF DIRECTORS

Chairman: Jim Chapman Vice-Chairman: Michael Fazio

Report of the Land Use Policy Subcommittee

Group/Division: Housing Finance and Regulatory Affairs

Staff Contacts: Debbie Bassert Alexandra Isham

Meeting Held: Las Vegas, Nevada Las Vegas Convention Center Sunday, February 17, 2019

I. CALL TO ORDER

The meeting of the NAHB Land Use Policy Subcommittee was called to order at 10:00 am by Subcommittee Vice Chair Jim Chapman.

II. APPROVAL OF 2018 MIDYEAR MEETING MINUTES

A motion was made and seconded to approve the 2018 Midyear Meeting minutes. The minutes were unanimously approved.

III. REPORTS/DISCUSSION ITEMS

A. DRAFT 2018 RESEARCH REPORT ON SMALL HOMES AND ADUS

Debbie Bassert, NAHB staff, provided an update on the research underway for NAHB by Opticos Design on smaller lots, smaller homes and accessory dwelling units (ADUs). The published report will be available at the Spring Leadership meeting in June.

The EO from Greenville, SC, relayed that Karen Parolek from Opticos had participated in a forum there and done a great job, to the degree that they will likely return to work on an evolving ordinance.

B. CREATING HOUSING FOR ALL BROCHURE AND WEB PAGE

Debbie Bassert conveyed that Jerry Howard and some EOs had asked staff to develop a short and simple outreach brochure on all of NAHB’s many reports on state and local housing affordability strategies that could be used as a conversation starter with local officials and policymakers at all levels of government.

The new Creating Housing for All brochure highlights the top strategies based on NAHB’s extensive credentialed research and points to a new www.nahb.org/housingforall webpage that breaks the reports down into targeted detail and many examples of attractive affordable projects.

This will allow policy makers and others to quickly research and discover new tools that they can use in their communities, along with examples of how and where they have been used successfully. The full research reports also still live in our one-stop shop Land Use 101 toolkit on nahb.org.

A member from Oregon noted that local governments there are feeling that they are losing control in light of the state affordability mandates.

An EO commented that infill and redevelopment are getting traction with local officials in Wichita in terms of what works and what doesn’t. They are going to modify the comprehensive plan and parallel zoning codes that can be used as overlays, with alternate setbacks, by-right approvals, streamlined processing, and cost waivers.

They leveraged walkability to start this effort, it was driven by the private sector.

A member asked what Wichita was doing with the architectural design aspects, to which Wess replied that these were simple steps and not overly complicated. There are also no longer conditional approvals for accessory dwelling units. The new brochure will really help validate some of the strategies they’re looking at.

The EO from Raleigh noted that North Carolina state law dictates that local governments cannot regulate aesthetics, so they are trying to gain control via other issues such as setbacks.

A member said municipalities in Arkansas pass standards to rule out lower incomes, such as preventing vinyl siding, limiting windows, types of trees, etc. They are trying to get North Carolina’s approach passed instead.

Chair Jim Chapman commented that Georgia is a home rule state, and Atlanta alone is comprised of 54 municipalities, many of whom engage in exclusionary zoning. They too are pushing for a bill that would remove aesthetic design controls.

The EO from Connecticut noted that communities there can reject affordable housing if it’s not in step with health, safety, and welfare of the community.

C. RESOLVING THE INCLUSIONARY ZONING CALCULATOR TOOL

Paul Emrath, NAHB staff, reiterated the existing issues with the calculator tool that had been developed by a consultant whom NAHB had parted ways with. He shared staff’s idea of reaching out to a graduate student to help resolve the technical errors and make it more workable.

Debbie Bassert posed the following two questions to the committee: 1) does the graduate student approach seem feasible, and 2) where the work should focus, if the whole tool cannot be addressed in an economically and timely manner.

Members generally agreed that the single-family tool would be simpler to fix and would serve more members, and that the multifamily tool would present larger challenges.

Debbie Bassert conveyed that the overall goal is to educate officials about development economics in terms of how requirements and fees affect the very feasibility of development and a developer’s decision to build in their town. This tool would provide that information in a transparent, standardized way without a developer having to share his own private pro forma.

Members agreed that a graduate student is the best approach and concluded that the focus should focus be on single-family and to recommend that to the full Committee. Debbie will reach out to local real estate schools to find a graduate student who understands both real estate and accounting principles. A member shared that they retain graduate students who prepare algorithms, regardless of topic.

D. SUSTAINABILITY AND GREEN BUILDING UPDATES

Michelle Diller, NAHB Sustainability & Green Building staff, provided an update to the subcommittee, which included:

• A review of the current National Green Building Standard (NGBS) certifications (as of 2/14/19)

o 27 certified land developments, 8 more registered o 1,683 certified lots within NGBS land developments, 24,501 more registered o Map showing Top Ten states for NGBS certifications

• Status report on NGBS versions

o 2012: registration sunset 12/31/18, must complete by 12/31/21; one-year grace period to register if your state using pre-2012 I-codes o 2015: current version, free pdf download at Builder Books. Summary document of changes from 2012 to 2015 provided in handout; Chapter 5 (Lot Design) changes were presented o 2020: revision process nearly complete, rollout expected 2020 IBS. . Will be a streamlined ‘Certified’ path for SF . Expanded scope to fully certify mixed use buildings . Performance path for Water Efficiency . Revamp of the remodeling chapter . Provided high-level review of LEED v4.1

• LEED for Homes now consolidated into LEED Residential

o Registration targeted to open Spring 2019 o All credit categories streamlined to better reflect important residential features o New Education Products are being developed by green staff and will be available in the coming months through the NAHB Sustainability Toolkit webpage

IV. LAND USE POLICY ISSUES ROUNDTABLE

Devala Janardan provided an update on the NIC case about access to federal courts and noted that a decision was likely before June.

Debbie Bassert inquired if any members have received calls about rezoning for solar fields. No members have received calls yet, but Michael Dey noted that in South Carolina, they are mostly going into unzoned areas. They are coming up in Kansas and New York as well and are being targeted in areas where they are not prohibited, such as farms with wetlands. In Connecticut, they fall under the state’s siting council, as they are considered to be utilities.

Jessica Hall, NAHB staff, shared that Maxine Waters, a Democrat in the U.S. House of Representatives, is willing to discuss impact fees. One idea presented by this Representative is to make an amount of federal money available to communities to help lower and middle-lower class workforce families. This money would ideally lower the need for impact fees, and by having this money available, developers and builders may be encouraged to build in lower and middle-lower class areas, where development does not normally occur. Members agreed that NAHB should be a positive voice at this table, as the topics of impact fees and housing affordability are both important to members.

Tom Ward, NAHB staff, is also looking at exclusionary design and architectural standards, so if members have examples of this, please send them to Tom.

Other issues mentioned were AT & T introducing and passing a bill in Kansas that limited their need to work with local government for rights of way for microtowers, cluster mailbox units (CT), and prevailing wages (NY).

The meeting was adjourned at 12:00 p.m.

ATTENDANCE

SUBCOMMITTEE MEMBERS PRESENT:

Jim Chapman Laura Comek Michael Dey Michael Fazio Wess Galyon Paul Kane Craig Karn George LaCava Frank Murphy Dave Nielsen Don Overton Jim Perras Bill Sanderson Richard Smith

SUBCOMMITTEE MEMBERS NOT PRESENT:

Tracy Butler Lew Dubuque Gary Hill Len Pratt Don Whyte

OTHERS IN ATTENDANCE:

Susan Asmus Michelle Diller Paul Emrath, by phone Jessica Hall Devala Janardan Dan Lloyd Natalia Siniavskaia

Embargoed for Monday, April 29, 2019, 7:00 a.m. Contact Name: Paul Colgan Organization: Home Builders Association of Greater Chicago Phone Number: 312.259.9114 Email: [email protected]

Rethinking Chicago Housing Affordability Building Affordability in ALL Chicago Neighborhoods

Chicago, April 29, 2019 – Research commissioned by Home Builders Association of Greater Chicago (HBAGC) reveals that solving housing affordability needs in Chicago require broader collaboration and a focus on creating more housing opportunities across all neighborhoods, not less. “We believe the right solution necessitates the inclusion of both public and private stakeholders, working in collaboration, so that our municipalities thrive and there is housing for everyone” said Pat Cardoni, President of the HBAGC City Chapter. “With the proper incentives, private housing developers can build new housing for all residents of Chicago from affordable to market rate, while also creating thousands of new construction jobs and generating millions in new property tax revenue.” HBAGC, representing members across Chicago’s home building spectrum since 1939, arrives at this position after a full review of current research data, provided by the Midwest Multi-Family Team at Cushman & Wakefield, led by Managing Director Susan Tjarksen. Cushman & Wakefield is a global real estate services provider. The data identified more than 3,000 units of housing that are on hold or cancelled in the 2017 ARO Pilot areas. This includes more than 300 affordable units with a construction value of more than $1bn. Proposals for housing development virtually stopped in the Pilot areas after enactment of new, more restrictive Pilot requirements. The demand for housing, however, did not stop. This created competition for available units, thus pushing rents higher. As a result, naturally occurring affordable housing was getting priced out of reach for historical occupants. Cardoni continues, “The research tells a story of unintended consequences of city policies which restrict development of new housing in areas of Chicago where housing demand is highest. Imagine what one billion dollars in union wages, building supplies and professional fees could mean for the economy of Chicago. “This represents a loss of more than $635 million in property taxes over the next 30 years. Further imagine what that money could do for Chicago schools, parks, fire and police. We need to find broad-based, equitable solutions that are equal to the status and desirability of the great City of Chicago, where housing is available for everyone. Ten percent of something is far better than twenty percent of nothing.” HBAGC also released a list of recommendations for new Chicago Housing Policies, focused on increasing the supply of housing for all Chicagoans. One recommendation calls for the creation of Chicago Housing Opportunity Zones. “Chicago has a number of great housing programs available but they need better focus,” said Paul Colgan, Government Affairs Director for HBAGC. “We want to take the best of local, state and federal initiatives for encouraging private investment and focus that investment into areas of need.” The Housing Opportunity Zones would leverage Federal Opportunity Zone, Enterprise Zone, and other programs to provide needed incentives for private investment in neighborhood housing. Further, the HBAGC recommendations called for a Neighborhood Development Initiative that would free up 1,000 city lots for development of traditional Chicago two and three flat buildings. This initiative could create 2,000 to 3,000 market rate and affordable two and three bedrooms units for families. It includes education to train neighborhood residents how to become owner occupants of the buildings. “The strength of traditional Chicago neighborhoods was built around owner occupied two and three flat buildings,” said Colgan. “We need to encourage the rebuilding of these neighborhoods by filling vacant lots with new housing for families that not only helps creates naturally occurring affordable housing, but also helps build family and community wealth for hard-working Chicagoans.” Other proposals include:

• Property Tax Incentives for Affordable Housing • Tax Credits for Workforce Housing Investments • Expanded Rental Assistance Programs • Innovative Off-Site ARO Housing Options • Utilization of Affordable Ownership Models for Cooperatives • Allow Accessory Dwelling Units (such as coach houses). • Zoning Reform Similar to Minneapolis where Greater Housing Density is Allowed RETHINKING HOUSING AFFORDABILITY IN CHICAGO Lessons From The Affordable Requirements Ordinance, And Alternatives For Expanding Access To Housing

Eligibility In-lieu Fee Unit Obligation (for multifamily above 10 units) Requirements for (per unit) Since 2010, there have been over 133,000 new jobs added Affordable Renters 10% units required to be affordable, with 1/4 required 60% of Area Median $52,214 to 2015 ARO as on-site or off-site units within two miles of site and Income $130,534 to downtown Chicago - leading to both economic growth within two miles of site and downtown boundaries 10% units required to be affordable, with 1/4 EXISTING 60% of Area Median required as on-site or off-site units within two $182,748 DOWNTOWN ARO Income and displacement pressure on neighborhoods miles of site and in downtown boundaries Price rental units for 15% required for on-site units No MILWAUKEE AVE 60% AMI, allow OR 20% for off-site units within Pilot Area in-lieu fee CORRIDOR PILOT tenants up to 80% OR 20% on-site if the project receives TIF funding available AMI to lease -On-site units for 20% required: No 60% AMI NEAR NORTH ZONE - First 10% on-site or < 2 miles in Zone in-lieu fee -Off-site within Pilot - Additional 10% may be built anywhere in Zone available for 100% AMI Chicago has led the nation in incoming corporate relocations -On-site units for 15% required: No 60% AMI NEAR WEST ZONE - First 10% on-site or < 2 miles in Zone in-lieu fee -Off-site within Pilot - Additional 5% may be built anywhere in Zone available for five consecutive years, strengthening the city's taxbase and for 100% AMI 20% required: Price rental units - First 10% on-site attracting new residents to a range of neighborhoods. Between for 60% AMI, allow PILSEN PILOT - Units with multiple bedrooms will partially meet ARO $178,469 tenants up to 80% baseline AMI to lease 2005 and 2015, 18,840 net new downtown workers chose to - Additional 10% on-site, off-site, or fees paid 20% required: Price rental units - First 10% on-site live in the neighborhoods of Wicker Park, Logan Square, West LITTLE for 60% AMI, allow - Units with multiple bedrooms will partially meet ARO $101,388 VILLAGE PILOT tenants up to 80% baseline AMI to lease Loop, Pilsen, Humboldt Park, among others. Attracted by easy - Additional 10% on-site, off-site, or fees paid access to transit, iconic neighborhood institutions, and a unique regional identity, this growing talent base began putting upward pressure on the existing residents of those neighborhoods. Many of the existing community members in these neighborhood are economically disadvantaged and/or belong to minorities. In Logan Square alone, a traditionally Hispanic neighborhood, the neighborhood saw a 35% net loss of its Hispanic residents.

Displacement pressures pushed the city of Chicago to increase affordable housing requirements for new market-rate developments, culminating in the 2017 ARO pilot

Beginning officially in 2007, Chicago has instituted an Affordable Requirements Ordinance (ARO) to require new market rate developments to contribute towards the production of affordable housing. This inclusionary housing policy - where developers The ARO has resulted in a limited number of could build units on-site or off-site affordable units, or pay a fee new affordable units, in-lieu fees that take toward an affordable housing fund - saw iterations in both 2015 years to be allocated and reduced market rate and 2017. In both of these update ordinances, requirements were development. increased and more stringent. Within the 2017 Pilot Zones, inclusionary requirements have ALTERNATIVES: increased to levels (up to 20 percent, with higher expectations for on-site units) that make pro formas for new developments difficult • A strong and productive inclusionary platform is dependent to pencil under current market expectations. Despite increased upon a strong tide of market rate development. Adjust approvals for multifamily developments, construction permits requirements to a reasonable range that prevents dead have fallen for the past two years. Lack of large-scale multifamily deals that produce no inclusionary units or affordable funds. developments will only push new talent arriving in Chicago to Instead utilize pro forma data to determine an optimal range seek options from the city's existing housing stock, cannibalizing to maximize inclusionary units produced. much of the existing workforce housing. Already, over 1,500 1-4 flats have been torn down and replaced with primarily smaller • Off-site solutions are held back by challenges to site single family homes and condominiums between 2009 and location and construction regulations. Developers often 2018. Unsurprisingly, these teardowns have been concentrated spend months searching for, acquiring and formulating an primarily in the ARO Pilot Zone area. offsite option. If the City can allocate and expedite use of the thousands of vacant city-owned parcels for market

2007 2015 2017 Pilot rate developers needing off-site options, investment could Units Goal 1,000 units/yr 240 units/yr 333 units/yr dramatically increase for historically de-invested areas. In-Lieu Fee Goal - $18M/yr None On-site units created 430 303 (72) Additional waivers of fees and expedited permitting could Units from in-lieu fees 1,600+ 1,218 ** further incentivize developers to utilize this option. Avg In-Lieu Fees - $16.6M/yr ** Collected • If inclusionary requirements remain at 20 percent levels, tax abatements should be utilized so that developments end up going through. Without a tax abatement or subsidy for the lifetime of the affordable units, which many other cities A solution toward strengthening housing for have in place, developments with that high of a requirement Chicago’s workforce class should involve a will be limited. comprehensive plan that continues the city’s economic growth and optimizes how market • Utilize a comprehensive plan that includes the above and rate development can help solve the issue other policies to provide a full spectrum solution for all Chicago neighborhoods. In addition to the above, a number of policies could promote housing across incomes and communities. Conduct a citywide reevaluation of the zoning code and permitting process, strategically upzoning portions ARO PILOT AREAS: TIME FROM of the city that are transit-oriented and can support higher APPROVAL TO PERMIT density. Legalizing and expediting permitting for ADUs, also known as coach houses, to further grow the housing stock. 2000 2015 ARO 2017 ARO PILOT

1000

2000 DAYS AWAITING UNTIL PERMIT PERMITDAYS / DAYS 2012 2014 2015 2016 2017 2018 DATE MAY 2019

AAR0 PILOTR STUDYO Evaluating its Effects, One Year In CONTENTS

ARO HIST0RY & GOALS...... 03

CURRENT ARO PROGRAM...... 04

DEVELOPMENT FEASIBILITY CASE STUDY...... 06

DEVELOPMENT FEASIBILITY CASE STUDY...... 08

MARKET RATE PRODUCTION TRENDS...... 10

LAND SALES BY PRICE PER FAR 2012 - 2018...... 11

POTENTIAL TAXBASE...... 13

NEW CONSTRUCTION PERMIT ANALYSIS...... 14

REPLACEMENT OF MULTI-UNIT HOUSING WITH SINGLE FAMILY PRODUCT...... 18

OVERVIEW OF CITY AFFORDABLE PROGRAMS...... 20

AFFORDABLE UNIT PRODUCTION BY AMI...... 22

ARO TRACK RECORD...... 24

ARO PILOT DEVELOPMENT PIPELINE...... 25

DEVELOPABLE LAND TRANSACTIONS...... 27

IN-LIEU FEES...... 28

DOWNTOWN AFFORDABLE DENSITY BONUS PROGRAM...... 29

CHICAGO POPULATION GROWTH...... 30

CHICAGO TALENT GROWTH...... 31

DOWNTOWN WORKERS LIVING IN PILOT AREAS...... 32

COLLEGE GRADUATES CHOOSE CHICAGO...... 34

DOWNTOWN JOB GROWTH...... 35

CORPORATE EXPANSIONS...... 36

INCLUSIONARY PROGRAMS ACROSS THE US...... 38

COMPARISON OF INCLUSIONARY PROGRAMS...... 40

CONCLUSIONS...... 42

SOLUTIONS...... 43

SOURCES...... 44 01

2011 Q

2012 Q

2013 Q

2014 Q

2015 Q

2015 Q PRESENTED TO 2015 Q

2016 Q

2017 Q

2018 Q

This 2018research Q paper was commissioned by the Home Builders Association of Greater Chicago and funded in part by a grant from the State and Local Issues Fund of the National Association of Home Builders. 02

Introduction First established in 2003, the City of Data on Chicago’s ARO program, as well as Chicago’s Affordable Requirements those of other markets, has grown to Ordinance (ARO) was designed to promote enable stakeholders to begin to answer affordable housing alongside the growth of several key questions: market rate developments using a mechanism commonly referred to as • What is the effect of the ARO upon an Inclusionary Zoning (IZ). IZ requires individual development? market-rate developers to either set aside • Given the pressure the ARO places on a certain percentage of a project’s units as market rate development, what is the affordable or pay an in-lieu fee to the city’s corresponding effect on housing supply affordable housing programs. and the city’s taxbase? • How effective has the ARO been in Over the past 15 years the ARO has gone creating affordable units? through a number of changes, most aimed • How close has the program come to at placing larger and stricter requirements reach its unit and funding goals? upon large-scale developers seeking to • What has been happening around the build multifamily in Chicago. As with many nation with other IZ programs? Are markets across the US, Chicago faces a there models that could better optimize housing shortage across the income expanding market rate housing while spectrum. Chicago is also not alone in simultaneously growing the affordable expanding its IZ policy in hopes of housing stock? providing more affordable housing and • Are there certain incentive models or better integrating populations divided by other policies that could do the same? income.

IS THERE A BETTER PATH FORWARD TO EXPANDING HOUSING TO MEET THE NEEDS OF ALL OF CHICAGO’S WORKFORCE? ARO HIST0RY & GOALS 03

2007 ARO Scope: • Land purchased from the City 2007 • Receive financial assistance from the City • Belong to a PD in a downtown zoning district Requirement: • 10% units affordable (20% for those receiving financial assistance) • OR pay $100,000 in-lieu fee per affordable unit not built Goal: 1,000 units / year On-site ARO Units Produced: 450 (54 units / year average) In-lieu Fees Collected: $84.1M

2015 ARO Scope: Citywide, with an additional Affordable Density Bonus program for downtown 2015 Requirement: See table, next page Goal: 1,200 units (240 units / year average), $90M in in-lieu fees for 5 years On-site ARO Units Delivered & In Progress 2016-2018: 332 (111 units / year average) In-lieu Fees Promised: $16.8M (19% of goal at EOY 3)

2017 ARO PILOT Scope: Near North, Near West and Milwaukee Corridor Zones Requirement: See table, next page 2017 Goal: 1,000 units over 3 years (333 units / year) On-site ARO Units Produced: None (72 units under construction) In-lieu Fees: No fees generated

2018 ARO PILOT Scope: Pilsen & Little Village Zones Requirement: See table, next page 2018 Goal: No explicit unit goal On-site ARO Units Produced: None In-lieu Fee Funded Units Produced: None

Source: City of Chicago Quarterly Affordable Housing Report, 2014 ARO Proposed Enchancements 04 CURRENT ARO PROGRAM

Eligibility In-lieu Fee Unit Obligation (for multifamily above 10 units) Requirements for (per unit) Affordable Renters 10% units required to be affordable, with 1/4 required 60% of Area Median $52,214 to 2015 ARO as on-site or off-site units within two miles of site and Income $130,534 within two miles of site and downtown boundaries 10% units required to be affordable, with 1/4 EXISTING 60% of Area Median required as on-site or off-site units within two $182,748 DOWNTOWN ARO Income miles of site and in downtown boundaries Price rental units for 15% required for on-site units No MILWAUKEE AVE 60% AMI, allow OR 20% for off-site units within Pilot Area in-lieu fee CORRIDOR PILOT tenants up to 80% OR 20% on-site if the project receives TIF funding available AMI to lease 20% required: -On-site units for No - First 10% on-site or < 2 miles in Zone and/or higher income 60% AMI NEAR NORTH ZONE in-lieu fee zone -Off-site within Pilot available - Additional 10% may be built anywhere in Zone for 100% AMI -On-site units for 15% required: No 60% AMI NEAR WEST ZONE - First 10% on-site or < 2 miles in Zone in-lieu fee -Off-site within Pilot - Additional 5% may be built anywhere in Zone available for 100% AMI 20% required: Price rental units - First 10% on-site for 60% AMI, allow PILSEN PILOT - Units with multiple bedrooms will partially meet ARO $178,469 tenants up to 80% baseline AMI to lease - Additional 10% on-site, off-site, or fees paid 20% required: Price rental units - First 10% on-site LITTLE for 60% AMI, allow - Units with multiple bedrooms will partially meet ARO $101,388 VILLAGE PILOT tenants up to 80% baseline AMI to lease - Additional 10% on-site, off-site, or fees paid

Source: City of Chicago 05

ARO PILOT PROGR AM 201 8 MILWAUKEE CORRIDOR PILOT

NEAR NORTH ZONE

NEAR WEST ZONE

PILSEN ZONE

LITTLE VILLAGE ZONE

MILWAUKEE CORRIDOR

NEAR NORTH

NEAR WEST

PILSEN

LITTLE VILLAGE 06 DEVELOPMENT FEASIBILITY CASE STUDY

WHAT IS THE EFFECT OF THE ARO UPON A DEVELOPMENT’S PRO FORMA? ASSUMING SELLER STRIKE PRICE OF $14 MILLION

CASE STUDY BASIS NO AFFORDABLE REQUIREMENT • Pilot Zone: Near North Number of Units 224 Number of Affordable 0 • Ward: 27th, Walter Burnett Units • Land size: 30,000 sf Potential Market Rent ($3.30/sf rent on market $6,652,800 • Proposed zoning: DX-5 units) Total Income Estimate (est • Zoning with bonuses: FAR of 8 of $3600/unit in other $6,953,184 income) • Return requirement: 6% Estimated Expenses $2,800,000 • Construction costs: $285 psf ($12,500/unit) NOI Estimate $4,153,184 • Land cost: $14M Stabilized Value $83,063,680 • Average unit size: 750 sf Cap Rate 5.00% • Pro forma rent: $3.30 Build Cost $61,880,000

• Assuming 4 year process 3-Year Return 10.31%

FINANCIAL ASSUMPTIONS

• Any rounding needed for affordable housing is rounded up, including # off-site (eg if 10% on-site and 10% off-site out of 45 units, 23 are calculated as off-site) • Other Income estimate derived from Yardi Matrix values of buildings built in last 2 years. • On-Site Expenses per unit derived from Yardi Matrix buildings built in last 2 years. • Build cost assumes $250,000 off-site development cost, $285/rsf on-site costs. • Potential Market Rent from Affordable units is per CITY OF CHICAGO MAXIMUM AFFORDABLE MONTHLY RENTS 2018 • Assumed 38% Studio, 40% 1-bedroom, 20% 2-bedroom, and 2% 3-bedroom units for affordability calculations.

Source: Cushman & Wakefield Research 07

20% REQUIRED ONSITE (1/2 AT 60% AMI, 1/2 AT 20% AFFORDABLE OFFSITE (1/2 AT 60% AMI, 1/2 100% AMI) AT 100% AMI) Number of Units 224 Number of Units 224

Number of Affordable Units 45 Number of Affordable Units 45 Potential Market Rent ($3.30/sf Potential Market Rent ($3.30/sf $5,996,442 $5,996,442 rent on market units) rent on market units) Total Income Estimate (est of Total Income Estimate (est of $6,342,771 $3600/unit in other income $6,274,371 $3600/unit in other income) onsite, $2,000 offsite) Estimated Expenses ($12,500/ $2,800,000 Estimated Expenses ($12,500/ unit) unit onsite, 50% expense ratio $2,682,536 NOI Estimate $3,542,771 offsite) NOI Estimate $3,591,835 Stabilized Value $70,855,421 Stabilized Value $71,836,701 Cap Rate 5.00% Cap Rate 5.00% Build Cost $61,880,000 Build Cost $63,511,250 3-Year Return 4.62% 3-Year Return 4.19%

Development projects require a minimum 6% return to be feasible

10% AFFORDABLE ONSITE 10% AFFORDABLE 10% AFFORDABLE ONSITE AT 80% AMI OFFSITE AT 80% AMI Number of Units 224 Number of Units 224 Number of Affordable Units 23 Number of Affordable Units 45 Potential Market Rent ($3.30/sf Potential Market Rent ($3.30/sf $5,996,040 $6,317,844 rent on market units) rent on market units) Total Income Estimate (est of Total Income Estimate (est of $3600/unit in other income $6,307,437 $3600/unit in other income $6,573,275 onsite, $2,000 offsite) onsite, $2,000 offsite) Estimated Expenses ($12,500/ Estimated Expenses ($12,500/ $2,800,000 unit onsite, 50% expense ratio $2,692,390 unit) offsite) NOI Estimate $3,773,275 NOI Estimate $3,615,047 Stabilized Value $75,465,498 Stabilized Value $72,300,944 Cap Rate 5.00% Cap Rate 5.00% Build Cost $62,713,750 Build Cost $61,880,000 3-Year Return 4.86% 3-Year Return 6.84%

Source: Cushman & Wakefield Research 08 DEVELOPMENT FEASIBILITY CASE STUDY

ASSUMING $4 MILLION SALE PRICE:

CASE STUDY BASIS NO AFFORDABLE REQUIREMENT • Pilot Zone: Near North Number of Units 224 Number of Affordable 0 • Ward: 27th, Walter Burnett Units • Land size: 30,000 sf Potential Market Rent ($3.30/sf rent on market $6,652,800 • Proposed zoning: DX-5 units) Total Income Estimate (est • Zoning with bonuses: FAR of 8 of $3600/unit in other $6,953,184 income) • Return requirement: 6% Estimated Expenses $2,800,000 • Construction costs: $285 psf ($12,500/unit) NOI Estimate $4,153,184 • Land cost: $4M Stabilized Value $83,063,680 • Average unit size: 750 sf Cap Rate 5.00% • Pro forma rent: $3.30 Build Cost $51,880,000

• Assuming 4 year process 3-Year Return 16.99%

FINANCIAL ASSUMPTIONS

Source: Cushman & Wakefield Research 09

20% REQUIRED ONSITE (1/2 AT 60% AMI, 1/2 AT 20% AFFORDABLE OFFSITE (1/2 AT 60% AMI, 1/2 100% AMI) AT 100% AMI) Number of Units 224 Number of Units 224

Number of Affordable Units 45 Number of Affordable Units 45 Potential Market Rent ($3.30/sf Potential Market Rent ($3.30/sf $5,996,442 $5,996,442 rent on market units) rent on market units) Total Income Estimate (est of Total Income Estimate (est of $6,342,771 $3600/unit in other income $6,274,371 $3600/unit in other income) onsite, $2,000 offsite) Estimated Expenses ($12,500/ $2,800,000 Estimated Expenses ($12,500/ unit) unit onsite, 50% expense ratio $2,682,536 NOI Estimate $3,542,771 offsite) NOI Estimate $3,591,835 Stabilized Value $70,855,421 Stabilized Value $71,836,701 Cap Rate 5.00% Cap Rate 5.00% Build Cost $51,880,000 Build Cost $53,511,250 3-Year Return 10.95% 3-Year Return 10.31%

However, no sellers will accept a $10 Million discount for land of this size and location

10% AFFORDABLE ONSITE 10% AFFORDABLE 10% AFFORDABLE ONSITE AT 80% AMI OFFSITE AT 80% AMI Number of Units 224 Number of Units 224 Number of Affordable Units 23 Number of Affordable Units 45 Potential Market Rent ($3.30/sf Potential Market Rent ($3.30/sf $5,996,040 $6,317,844 rent on market units) rent on market units) Total Income Estimate (est of Total Income Estimate (est of $3600/unit in other income $6,307,437 $3600/unit in other income $6,573,275 onsite, $2,000 offsite) onsite, $2,000 offsite) Estimated Expenses ($12,500/ Estimated Expenses ($12,500/ $2,800,000 unit onsite, 50% expense ratio $2,692,390 unit) offsite) NOI Estimate $3,773,275 NOI Estimate $3,615,047 Stabilized Value $75,465,498 Stabilized Value $72,300,944 Cap Rate 5.00% Cap Rate 5.00% Build Cost $52,713,750 Build Cost $51,880,000 3-Year Return 11.11% 3-Year Return 13.31%

Source: Cushman & Wakefield Research 10 MARKET RATE PRODUCTION TRENDS

In the year following the establishment of the 2017 Pilot Areas, only 2 projects were approved and then permitted. This is opposed to 7 projects following the establishment of the 2015 ARO program

ARO PILOT AREAS: TIME FROM APPROVAL TO PERMIT

2000 2015 ARO 2017 ARO PILOT

1000

2000 DAYS UNTIL PERMIT PERMIT / DAYS AWAITING DAYS 2012 2014 2015 2016 2017 2018 DATE

Note: For building-by-building identification, see appendix Source: Cushman & Wakefield Research, Recity, City of Chicago LAND SALES BY PRICE PER FAR 2012 - 2018 11

Land sales within the Pilot Areas have not taken a noticeable discount in price since the establishment of the Pilot

Price per square feet of FAR was calculated based on the recorded sale of the land and the final, approved FAR of the project. Ordinance version was based on city record by date of approval.

MULTIFAMILY LAND SALES WITHIN PILOT AREAS

$90

$80 300+ units

100 units $70 25 units

$60 2007 ARO 2015 ARO

$50 2017 ARO pilot

$40 DOLLAR PER FAR

$30

$20

$10

$0 2013 2014 2015 2016 2017 2018 YEAR

Source: Cushman & Wakefield Research, Recity, Reonomy, City of Chicago 12

606 TRAIL

6 CORNERS WICKER PARK POTENTIAL TAXBASE 13 As pro formas become more difficult to pencil, more and more sites have been passed over by developers due to infeasibility. Cushman & Wakefield conducted a survey of sites within the Pilot Areas to estimate the lost potential in terms of units and taxes

DEVELOPMENTS PASSED OVER DUE TO PILOT

2,639 estimated units 264 potential ARO units (assuming a 10% affordable requirement) $34.5M potential in-lieu fees (assuming a 10% affordable requirement as in-lieu)

$565M estimated 30-year taxes with development $50M estimated 30-year taxes without development

$515M 30 year spread

DEVELOPMENTS NOT YET APPROVED IN PILOT 616 estimated units $132M estimated 30-year taxes with development $6.5M estimated 30-year taxes without development

$125M 30 year spread

Note: See appendix Source: Homebuilders Association for greater Chicago, Recity, Reonomy, Cook County Assessor 14 NEW CONSTRUCTION PERMIT ANALYSIS

NEW CONSTRUCTION PERMITS BY WARD

New construction permits are down throughout the city Looking at buildings permitted with 10 or more units:

TOTAL 9,000

8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Units permitted are down 23% from 2017 and 34% from the high in 2016 When looking at only the wards with the highest amount of development:

BY WARD 8,000

7,000

6,000

5,000

4,000

3,000

2,000 UNITS PERMITTED

1,000

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

1st Ward 25th Ward 27th Ward 2nd Ward 32nd Ward 3rd Ward 42nd Ward 43rd Ward 44th Ward 46th Ward 47th Ward 4th Ward Units permitted are down 33% in 2018 and 45% from the high in 2016

Source: City of Chicago 15

The fall in permitting is even more drastic when looking at developments of 100 or more units

TOTAL

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Units permitted are down 33% from 2017 and 49% from the high in 2016

BY WARD 7,000

6,000

5,000

4,000

3,000

2,000 UNITS PERMITTED

1,000

0 2010 2011 2012 2013 2014 2015 2016 2017 2018 1st Ward 25th Ward 27th Ward 2nd Ward 32nd Ward 3rd Ward 42nd Ward 43rd Ward 44th Ward 46th Ward 47th Ward 4th Ward Units permitted are down 45% from 2017 and 56% from the high in 2016 16

Meanwhile, permitting of buildings under 10 units - which are not affected by the 2017 ARO Pilot - remains strong

LESS THAN 10 UNITS 1,400

1,200

1,000

800

600

400

200

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

The most active wards in permitting small buildings are:

ARO EFFECTS Alderman Ward Total Units Proco Joe Moreno 1st Ward 1,269 Scott Waguespack 32nd Ward 771 Walter Burnett, Jr. 27th Ward 545 Thomas M. Tunney 44th Ward 529 Ameya Pawar 47th Ward 503 Brian Hopkins 2nd Ward 485 Michele Smith 43rd Ward 471 Daniel Solis 25th Ward 328

Source: City of Chicago 17 PERMITS ISSUED BY PILOT ZONE AREAS

10 + UNITS 1,800

1,600

1,400

1,200

1,000

800

600

400

200

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Milwaukee Corridor Pilot Near North Zone Near West Zone PilsenZone

Units permitted of buildings with over 10 units have increased year over year in the Near North and Milwaukee Corridor Pilot Zones since 2015. Since 2010 the Pilot Zone areas have added 11,005 units in multifamily buildings of 10 or more units.

10 UNITS OR LESS 500

450

400

350

300

250

200

150

100

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Milwaukee Corridor Pilot Near North Zone Near West Zone PilsenZone

In that same time frame, these areas have also added 3,501 units in buildings of 10 units or less, with the heavy majority of the units built in the Milwaukee Corridor Pilot Area. 18 REPLACEMENT OF MULTI-UNIT HOUSING WITH SINGLE FAMILY PRODUCT

Demolition Permits issued for 1-4 floor residential or 1-2 floor commercial, with construction permit issued within 180 days.

Source: City of Chicago, Chicago Cityscape 19

Chicago’s housing stock in Pilot neighborhoods has been eroded by the teardown and replacement of existing 1-4 flats with smaller, single family product

Removal of 1,500+ older buildings - residences that would otherwise be the “naturally-occuring” affordable housing - has resulted in a much more dramatic loss than the 844 on- site/off-site units created by the ARO program in the same period.

These flats would also represent a perfect opportunity for providing off-site options for developers seeking to fulfill the ARO requirement. However, the erosion of this product, coupled with stringent like-kind unit requirements has led to only 10 units created in this manner according to city records. 20 OVERVIEW OF CITY AFFORDABLE PROGRAMS

The ARO program has produced 844 units since 2009, roughly 30% of the total affordable units created and rehabbed by the City of Chicago

The 2015 ARO stated a goal of 1,200 on-site units and $90M in in-lieu fees over the course of fives years. By the end of 2018, the program has led to 332 completed on-site or off-site units and $16.8M of in-lieu fees. The program has a 54% shortfall in units expected at this point, as well as attaining only 31% of the expected in-lieu fees at this point.

CHICAGO’S AFFORDABLE HOUSING PROGRAMS 2017 Unit Production

Which of the many affordable programs actually produce new affordable units?

CITY OF CHICAGO 2017 AFFORDABLE HOUSING UNIT PRODUCTION AND SUPPORT Rental Subsidy Program Multi Family Rehab & New Construction *** Historic Bungalow Initiative Troubled Buildings Initiative Small Accessible Repairs for Seniors Roof and Porch Repairs Program ARO *** Neighborhood Lending Program Multi Family Rehab & New Construction Home Buyer Assistance Program Rental Assistance Heat Receiver Other Multi-family Rental TaxSmart Homeownership Emergency Heating Repairs Program Home Preservation TIF City Land Preserving Communities Together ***

0 500 1,000 1,500 2,000 2,500

*** = New, Long-term Affordable Units Number of Housing Units Source: Center for Tax and Budget Accountability 21 PROJECTIONS VS ACTUAL PRODUCTION

Developers have expedited projects to be completed prior to the establishment of the Pilot Zones, resulting in a temporary increase in ARO units in 2017 and 2018.

ARO Rental Units Projected ARO For Sale Units Projected Rental Units Actual For Sale Units Actual 300

200

100

0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

ACTUAL ARO RENTAL PRODUCTION VS TOTAL AFFORDABLE RENTAL UNITS

How much does ARO contribute to the overall HED affordable housing program?

Total Units Created, Supported, Preserved Total New Construction & Rehab ARO Units Actual 12,500

10,000

7,500

5,000

2,500

0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Source: City of Chicago Quarterly Affordable Housing Report 22 AFFORDABLE UNIT PRODUCTION BY AMI The majority of the

$35,580 city's newly created • Lyft / Uber Driver affordable units have • Restaurant Server 60% • Security Guard AMI • Daycare Teacher been concentrated • Barista • Courier between 50-60% • Nurse Assistant AMI, with relatively little production in the $47,400 • Entry Level Firefighter higher AMI bands to • Retail Store Manager 80% • Receptionist which inclusionary AMI • Bartender • Cable Technician zoning is suited for

The ARO was initiated to provide affordable housing to the populace below 60% AMI. However, $59,300 workforce brackets at the 80% and • Public School Teacher 100% AMI ranges contain many of • Construction Worker the professions belonging to heads 100% • Experienced (5+ years) Firefighter AMI of household that are in need of • Restaurant Manager affordability. • Yoga Instructor • Graphic Designer Changes in the ARO Pilot program, • Entry Level Police Officer enabled some expansion to the 80- 100% AMI range but at the expense of making building pro formas less feasible. Either units are mandated to be priced at 60% AMI for lease $71,160 by 80% AMI individuals, or 100% • Financial Analyst AMI options were limited to off- • Nurse site units. 120% • Electrician AMI • College Instructor • Experienced (5+ years) Police Officer

Note: AMIs are calculated by HUD on an MSA basis, varying by HH size Source: Glassdoor, City of Chicago Quarterly Affordable Housing Report, Department of Housing & Urban Development (HUD) 23

Total Afforadable Units Created / Preserved by AMI, 2009-2018

20,000 2018 2017 2016 2015 2014 15,000 2013 2012 2011 2010 10,000 2009 Units Created or Preserved

5,000

0 0-15% 16-30% 31-50% 51-60% 61-80% 81-100% 101%

AMI Range

Afforadable Units Created by AMI, 2014-2018

2018 2017 2016 2015 2014

4,000

3,000

2,000

Units Created or Preserved 1,000

0 0-15% 16-30% 31-50% 51-60% 61-80% 81-100% 101%

AMI Range 24 ARO TRACK RECORD

AFFORDABLE UNIT PRODUCTION UNDER 2007, 2015, 2017 ARO

What is the raw comparison between units created in these different systems?

2007 2015 2017 Pilot Units Goal 1,000 units/yr 240 units/yr 333 units/yr In-Lieu Fee Goal - $18M/yr None On-site units created 430 303 (72) In-Lieu Fees Collected $84.1M $16.8M (no/yr) **

** In-lieu units generated for non-pilot areas not reported yet . No in-lieu units generated from pilot zones.

Note: 2017 pilot on-site units are currently under construction, 1,582 on-site units are approved of which over 50% are from the multi-decades long River District project. ARO PILOT DEVELOPMENT PIPELINE 25

CURRENT PROJECTS UNDER 2017 ARO PILOT Number Off-site Name Approval On-site In-lieu Fee Address Developer of Units (known) 166 North 166 N MCZ 5/25/2018 236 24 23 Aberdeen Street Aberdeen St Development 725 West 725 W Related 7/25/2018 370 40 Randolph Street Randolph St Midwest Freedom 1515 W Cedar Street 6/21/2018 260 46 6 Center Flats Monroe St Companies 1122 West 1122 W Lipe Property 2/28/2018 97 20 Chicago Avenue Chicago Ave Company 730 N Tandem The Mill 7/25/2018 196 39 Milwaukee Ave Construction 1220 West 1220 W LG Development 3/28/2018 166 29 4 Jackson Blvd Jackson Blvd Group 1624 West 1624 W RDM 3/15/2018 121 21 Division Street Division St Development 1750 North 1750 N 9/13/2018 106 16 GW Properties Western Avenue Western Ave 335 West 335 W Lakshmi Capital 3/15/2018 105 21 Schiller Street Schiller St Management Tribune's 777 W Freedom Center 10/18/2018 3,600 520 Tribune Media Chicago Ave - Future Phases Tribune's Freedom Center 10/18/2018 1,500 300 W Grand Ave Tribune Media - Phase 1 1125 West Van 1125 W Van Tandem 11/15/2018 201 5 Buren Street Buren St Construction 1050 West Van 1050 W Van Tandem 11/15/2018 200 40 Buren Street Buren St Construction

Under Construction as of 4/19

Source: Cushman & Wakefield Research, Recity 26 DEVELOPABLE LAND TRANSACTIONS 27

Transactions of sites with potential for multifamily development have fallen since the proposal and enactment of the Pilot in 2017

> 15,000 SF Site Transactions Within Pilot Areas

200

150

2015 ARO enacted 2017 Pilot enacted 100 Transactions

0 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year

Within the Pilot, transactions have fallen 78% from their peak in 2016, with the 10 of the 2018 transactions being sales between LLCs that were owned in part by the same entity.

Requirements:

• Over 15,000 SF of Land

• Site was within borders of one of the 2017 Pilot Zones

• Zoning amenable to multifamily development

• Sale closed between January 1st and December 31st of that year

• Land Use was vacant, commercial, multifamily, retail or tax exempt at time of sale Source: Reonomy 28 IN-LIEU FEES

ARO In-lieu fees collected 2009-2018 ARO Pilot Zones Established

$25,000,000

$20,000,000

$15,000,000

10,000,000 in-lieu fees*

$5,000,000

$0.00 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year

ARO in-lieu fees have stagnated with the arrival of the Pilot Program

Year In-lieu Fees* 2009 $300,000.00 2010 Not Reported 2011 $1,800,000.00 2012 $10,800,000.00 2013 $4,100,000.00 2014 $20,900,000.00 2015 $16,400,000.00 2016 $20,150,000.00 2017 $15,025,000.00 2018 $14,717,294.00

Source: City of Chicago DOWNTOWN AFFORDABLE DENSITY BONUS PROGRAM 29

Downtown affordable density bonus payments

$20,000,000 Neighborhood Opportunity Fund established, changing density bonus system in all Downtown zoning districts. $15,000,000

$10,000,000 density bonuses** $5,000,000

$0.00 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year

The discontinued voluntary affordable density program has also reduced the city’s funding sources

Year Density Bonuses**

2010 $2,350,169.87 2011 $266,677.40 2012 $132,426.68 2013 $8,457,646.28 2014 $10,916,379.00 2015 $15,424,060.91 2016 $8,776,998.17 2017 $2,435,863.69 2018 $123,401.00 30 CHICAGO POPULATION GROWTH

Population moving into the city is going to place upward pressure on rents to lack of new supply

RISING NUMBERS DOWNTOWN 2011 - 2016 Throughout the past several years the urban core and surrounding neighborhoods of Chicago have seen strong population growth. These neighborhoods exhibit high average EVANSTON household income and a high percentage of educational attainment - demographics that have only grown stronger in recent years.

The majority of out-migration has occurred around the Far South Side neighborhoods such as Calumet and Roseland.

LINCOLN PARK

WEST • 7.7% increase in population 2010 - 2018 LOOP LOOP • 55% increase in individuals with $150,000+ in the same time period

-6,000+ -4,000 -2,000 0 CHICAGOLAND 2,000 4,000 POPULATION CHANGE POPULATION 6,000 Source: U.S. Census Bureau CHICAGO TALENT GROWTH 31

Attracting the best talent across industries to Chicago is supported by having continued deliveries of high end rental product

TOP TALENT ACCESS TO TALENT People commute to downtown 265K Population with a Graduate Degree 650K+ Chicago each business day with more than half taking mass transit People with bachelor’s degrees or College graduates with a bachelor’s or higher 714K 1M greater who live in the city of Chicago live within one mile of a CTA or Metra train stop

TOP 2 Business schools in the world Working age adults are within a 50-minute BigTen and Notre Dame alumni 3M+ commute of downtown Chicago - more than 500K in the greater Chicago Area 1.2 million are between 18-34 years old

ABUNDANT TALENT COMPETITIVE COST

EMPLOYMENT 2016 Management Employment (2016, Thousands) Management Wages (2016) Healthcare 571,433 Chicago 337 Chicago $116 Government 549,674 $159 Retail 469,764 New York City 506 New York City $130 Manufacturing 414,510 Los Angeles 238 Los Angeles

Hospitality 392,086 Dallas 141 Dallas $129 Administrative 372,892 $140 Houston 126 Houston Prof. Services 362,216 $142 Washington D.C. 236 Washington D.C. Wholesale 245,144 163 $150 Fin. & Insurance 229,904 San Francisco San Francisco $138 T&L 212,948 Philadelphia 125 Philadelphia $136 Other Services 193,585 Boston 221 Boston Construction 170,507 Atlanta 167 Atlanta $123 Education 142,794 Miami 109 Miami $121 Management 84,607 Seattle $131 Information 80,542 104 Seattle

In Chicago,38.5% of adults over the age of 24 have college degrees. This is the highest percent of the 5 largest cities in the U.S.

Source: Cushman & Wakefield Research, Chicago Investors Conference 32 DOWNTOWN WORKERS LIVING IN PILOT AREAS 2005 Heatmap of Chicago residents who work in the outlined Chicago downtown area

Downtown Boundaries Pilot Areas 33

2015 Job growth downtown has translated to population growth in the Pilot Areas. Over 18,840 commuters to downtown were added between 2009 and 2015 87% of which make over $3,333 a month

70% of whom are aged between 30 and 54

U.S. Census: Longitudinal Employer-Household Dynamics 34 COLLEGE GRADUATES CHOOSE CHICAGO

PERCENTAGE (%) OF CHICAGO'S RANKING U.S. NEWS 2019 UNIVERSITY GRADUATES THAT AMONG GRADUATE NATIONAL COLLEGE CHOOSE CHICAGO DESTINATIONS RANKING University of Chicago 38.4 1 3 Northwestern University 36.4 1 10 University of Notre Dame 14.1 1 18 University of Illinois at 42.0 1 46 Urbana-Champaign University of Iowa 15.6 1 89 University of Illinois at Chicago 67.6 1 129 Loyola Chicago University 63.5 1 89 DePaul University 71.5 1 119 210 Indiana University 13.2 2 89 200 Michigan State University 6.5 2 85 190 University of Minnesota 2.4 2 76 180 Purdue University 15.0 2 56 170 University of Wisconsin 10.0 2 49 160 University of Michigan 6.8 3 27 150 University of Nebraska 2.3 4 129 140 Ohio State University 2.6 5 56 130 120 110 100 90 80

Source: Wall Street Journal, U.S. News & World Report DOWNTOWN JOB GROWTH 35

The cost of doing business in Chicago remains competitive with other markets

COST OF DOING BUSINESS IN MAJOR CITIES

210 200 190 180 170 160 150 140 130 120 110 100 90 80 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Boston Fort Worth Atlanta Dallas Los Angeles Philadelphia Chicago Boston San Francisco New York City National Avg

Between 2017 and 2018, downtown Chicago saw a net increase of 19,249 jobs - a year-over-year increase of 3.2%

CHANGES IN CHICAGO-AREA EMPLOYMENT SINCE THE GREAT RECESSION MARCH 2010 MARCH 2018 CHANGE % CHANGE TOTAL METRO 3.1 MILLION 3.6 MILLION 463,820 +13.9% COOK COUNTY 2.0 MILLION 2.3 MILLION 270,882 +13.5% CHICAGO 1.0 MILLION 1.2 MILLION 185,980 +18.4% DOWNTOWN CHICAGO 479,199 612,914 133,715 +27.9% COOK W/O CHICAGO 1.0 MILLION 1.1 MILLION 74,902 +7.5% CHICAGO W/O DOWNTOWN 531,972 575,217 43,245 +8.1% Source: Cushman & Wakefield Research, Crain’s Business 36 CORPORATE EXPANSIONS

Submarket: West Loop Submarket: West Loop Gate / South Loop

- Status: Phase 1 Complete / Phase 2 In Process - Status: In Process

- Established Midwest Regional HQ in 2014 with - In the process of relocating 1,800 1,000+ employees in a 327,000+ sf space employees (including at least 300 tech workers) to the renovated old Chicago Post - Google announced yesterday that it would add Office, leasing over200,000 sf of space another 132,000+ sf to its Chicago campus in a new Sterling Bay development to be delivered in the next several months

- The company also is planning on leasing 14,000 sf nearby for its first flagship retail store in the world

- Submarket: Loop -Submarket: River North - Submarket: West Loop

- Status: Completed Summer - Status: Lease Signed - Status: Completed Spring 2018 2018 - Signed lease at Hines’ Wolf Point -Relocated global headquarters - Signed a 263,000 sf lease in the development that will establish from Chicagoland suburbs to a newly delivered CNA center, bring 250,000 sf new construction a 500,000 sf space. 1,000 new Facebook up to at least 2,000 office - totaling over2,000 employees in Chicago jobs are promised in the next five employees. years, with room for up to 4,000 additional employees upon the project’s completion.

Source: Cushman & Wakefield Research 37

YEAR LEASE YEAR SUBURBAN NEW CBD NEW COMPANY RSF SIGNED MOVED IN LOCATION LOCATION SUBMARKET Mondelez 2019 2019 Deerfield 905 W Fulton West Loop 83,000

Walgreens Boots Alliance 2018 2019 Deerfield 433 W Van Buren West Loop 200,000

Ferrara Candy 2018 2018 Oakbrook Terrace 433 W Van Buren West Loop 60,000

FTD 2018 2018 Downers Grove 1 N Dearborn Loop 41,000

Walgreens Boots Alliance 2017 2018 Deerfield 1 S State Loop 27,000

Allstate 2017 2017 Northbrook The Mart River North 57,000

Nielsen 2017 2018 Schaumburg 200 W Jackson Loop 161,000

Peapod 2017 2018 Skokie 300 S Riverside West Loop 53,000

Shure* 2017 2017 Niles 125 S Clark Loop 39,000

Sikich LLP 2017 2017 Naperville 200 W Madison Loop 22,000

Wilson Sporting Goods Co. 2016 2018 Rosemont One Prudential Loop 79,000

McDonald’s 2016 2018 Oak Brook 1045 W Randolph Fulton Market 523,000

Beam Suntory 2016 2017 Deerfield The Mart River North 100,000

EN Engineering* 2016 2016 Warrenville 180 N LaSalle Loop 20,000

Ulta Beauty* 2016 2016 Bolingbrook 120 S Riverside Loop 23,000

W.W. Grainger* 2016 2016 Lake Forest 125 S Clark Loop 29,000

Mead Johnson 2015 2017 Glenview 444 W Lake Loop 76,000

Allstate* 2015 2016 Northbrook The Mart River North 45,000

Baxalta* 2015 2016 Bannockburn 540 W Madison Loop 83,000

ConAgra 2015 2016 Naperville The Mart River North 210,000

Kraft Heinz 2015 2016 Northfield 200 E Randolph Loop 170,000

Stats 2015 2016 Northbrook 203 N LaSalle Loop 70,000

Horizon Pharma* 2015 2015 Lake Forest 150 S Wacker Loop 65,000

Motorola Solutions 2015 2015 Schaumburg 500 W Monroe Loop 150,000

Textura Corporation* 2015 2015 Deerfield One Prudential Loop 23,000

Nielsen* 2014 2016 Schaumburg 200 W Jackson Loop 54,000

Wintrust 2014 2015 Rosemont 231 S LaSalle Loop 179,000

Archer Daniels Midland Company* 2014 2014 Decatur 77 W Wacker Loop 46,000

Discover* 2014 2014 Riverwoods 350 N Orleans River North 26,000

Monitor Liability Managers 2014 2014 Rolling Meadows 233 S Wacker Loop 27,000

Newark Corp. 2014 2014 Ravenswood 300 S Riverside Loop 80,000

SAC Wireless 2014 2014 Schaumburg 540 W Madison Loop 40,000

Gogo Wireless 2013 2015 Itasca 111 N Canal Loop 232,000

AT&T 2013 2015 Hoffman Estates 225 W Randolph Loop 53,000 Source: Cushman & Wakefield Research 38 INCLUSIONARY PROGRAMS ACROSS THE US

INCLUSIONARY HOUSING COMPARISON BY MARKET YEAR UNITS % UNITS SET AFFORDABILITY ON-SITE OPTION/ IN-LIEU FEE AFFORDABLE DENSITY MARKET ESTABLISHED/ AMI TARGET MARKET OTHER INCENTIVES THRESHOLD ASIDE PERIOD REQUIREMENT MODEL BONUS PROGRAMS ALTERED Unit size, Parking require- *Texas prohibits ments, Design flexibility, mandatory Not manda- Various, bonuses based Optional <80% Various 10% By GSF Fee waivers/reductions, Austin inclusionary zon- tory Austin on SF Fee deferrals, Fast track ing permitting and Subsidy New density bonus By Unit Cost 2000, 2015 10+ 13-18% <70% 30+ 13% incentive program beta Boston Boston (15-18%) launched 2017 Additional density bonus for on-site TOD options, max out at a 1 FAR By Unit bonus for Dash 3 zon- 2003, 2015, 2017, 10+ 10-20% <60-120% 30 2.5-20% Affordability ing. Downtown-specific Chicago 2018 Chicago (7.5-10%) bonus removed in 2016, replaced with Neighbor- hood Opportunity Fund Bonus Up to $25,000.00 cash incentive in high-need areas, 20% parking No cap, case-by-case 2015, 2017 30+ 10% <100% 15 <10% By Unit Cost reduction and/or Denver Denver basis expedited review process, more flexible developer options Can qualify for reduced cost of development Up to a maximum 35% By Unit and/or increased 2016 10+ 11-25% <30-80% 55 5-20% FAR bonus for 20% units Los Angeles Los Angeles Affordability exposure, open space set aside as affordable etc. by State Density Bonus Program 2019 (under Undergoing Undergoing Undergoing Undergoing devel- Undergoing 10+ Undergoing development Undergoing development Minneapolis development) development development development Minneapolis opment development Up to a maximum up to 20% FAR bonus, enabling 1987, 2005, 2016 10+ 20-30% <60-115% Permanent 20-30% By GSF Tax Incentive Programs New York City New York City in-lieu fee, preservation or new construction Developing program, Portland 2017 20+ 10-25% <60-80% 99 Portland 6-20% By GSF max 3 FAR bonus with Affordable units Can qualify for reduced cost of development and/or increased 2002, 2017, 2019 10+ 12-25% <50-130% 55 18-20% By GSF Up to a 35% FAR bonus San Francisco San Francisco exposure, open space etc. by State Density Bonus Program By GSF, No cap, case-by-case Tax exemption under 2016, 2018 All 5-11% <60% Unspecified 5-11% Seattle Seattle housing cost basis new MHA program 8%- 10% of 10% of residential 2009 10+ residential <60-80% Unspecified N/A Up to a 25% FAR bonus Washington, D.C. Washington, D.C. floor area floor area 39

Source: Cities of Austin, Boston, Chicago, Denver, Los Angeles, Minneapolis, New York City, Portland, San Francisco, Seattle and Washington, D.C., US Census Bureau 40 COMPARISON OF INCLUSIONARY PROGRAMS

Chicago is the only major city that does not in some way offset the losses to developers associated with providing inclusionary units

NATIONAL SURVEY OF INCLUSIONARY ZONING REQUIREMENTS Number of programs

On-Site Affordable Units 235

In-Lieu Fee 131

Off-Site Affordable Units 121

Land Donation 72

Preserve/Rehab Existing Housing 50

Impact/Linkage Fee 41

Other 6

0 50 100 150 200 250

NATIONAL SURVEY OF INCLUSIONARY ZONING REQUIREMENTS Number of programs

No Incentive* 63

Other 4

Tax Relief Abatement (Exchange TIF) 8

Direct Public Subsidy and /or TIF 20

Expedited Permitting 49

Fee Reduction/Waiver 69

Other Zoning Variances 83

Density Bonus 146

0 30 60 90 120 150

* Save for Chicago, the remainder of no incentive IZ programs are from cities with populations less than 500,000 Source: Lincoln Institute for Land Policy Source: Cities of Austin, Boston, Chicago, Denver, Los Angeles, Minneapolis, New York City, Portland, San Francisco, Seattle and Washington, D.C., US Census Bureau 41

TARGET MARKET’S % POPULATION BY INCOME Austin <$15,000 $15,000 - $29,999 Boston $30,000 - $44,999 $45,000 - $59,999 Chicago $60,000 - $74,999 $75,000 - $99,999 Denver $100,000 - $124,999 $125,000 - $149,999 Los Angeles $150,000+

Minneapolis

New York City

Portland

San Francisco

Seattle

Washington, D.C.

MARKET POPULATION BY INCOME

Area AMI Area AMI Total $15,000 - $30,000 - $45,000 - $60,000 - $75,000 - $100,000 $125,000 - Market <$15,000 $150,000+ Individual Family Popultion $29,999 $44,999 $59,999 $74,999 $99,999 - $124,999 $149,999

Austin $50,700 $72,400 361,257 35,786 43,290 47,837 42,462 38,022 44,046 34,067 20,593 55,154

Boston $71,000 $107,800 263,229 47,236 31,600 26,217 22,914 22,118 26,157 23,767 16,044 47,176

Chicago $59,300 $84,600 1,046,789 165,177 162,829 135,886 108,515 92,476 114,428 81,270 51,278 134,930

Denver $62,900 $89,900 287,262 33,850 36,954 37,441 35,182 26,296 35,093 23,845 16,445 42,156

Los Angeles $67,800 $69,300 1,364,227 188,778 212,568 183,494 143,198 121,866 145,629 107,422 67,193 194,079

Minneapolis $62,900 $94,300 172,082 25,631 24,138 22,113 18,721 15,796 19,944 14,676 9,198 21,865

New York City $73,000 $70,300 3,142,405 491,844 439,246 375,015 302,670 267,568 341,935 255,389 170,004 498,734

Portland $57,000 $81,400 260,949 32,517 33,868 32,024 28,894 25,233 33,251 24,633 14,801 35,728

San Francisco $102,700 $118,400 358,772 40,254 33,354 27,413 23,467 24,578 34,819 33,742 26,156 114,989

Seattle $70,300 $103,400 314,850 31,277 29,493 31,486 30,849 26,431 37,338 31,422 23,079 73,475

Washington, D.C. $67,800 $117,200 277,985 39,079 28,667 24,162 22,461 21,259 29,781 26,091 18,308 68,177 Source: U.S. Census Bureau, HUD

Major cities across the US have either added or increased their inclusionary

zoning requirements over City the past several years, with many minimums set at 10% and reaching up to as much as 30%

Range of % Units Required Affordable by City

Source: Cities of Austin, Boston, Chicago, Denver, Los Angeles, Minneapolis, New York City, Portland, San Francisco, Seattle and Washington, D.C., US Census Bureau 42 CONCLUSIONS INCLUSIONARY ZONING PROGRAMS LIKE THE ARO REQUIRE STRONG DEVELOPMENT OF MARKET RATE HOUSING TO BE EFFECTIVE

Production of affordable units under inclusionary zoning has historically been limited, pushing urban policymakers to seek to expand production by increasing set-aside requirements and requiring more units constructed on-site. However, this tactic leads to diminishing returns - resulting in more and more infeasible units as the percentage set-aside is increased. However, production can be scaled along with market-rate developments - by spreading the affordable units over a larger number of new projects.

THE ARO PILOT HAS PUSHED MANY DEVELOPMENTS TO BE INFEASIBLE, THROTTLING FUTURE DEVELOPMENT WITHIN THEIR BOUNDARIES

Leading indicators of multifamily developments within neighborhood areas, land purchases and construction permits, both saw a sizable reduction in 2018. Both of these suggest that the latest requirements instituted have resulted in stagnation of future housing - market or affordable - within the 2017 Pilot neighborhoods.

IF THE GOAL OF THE ARO PILOT PROGRAM IS TO REDUCE COMMUNITY DISPLACEMENT, OTHER POLICIES MAY BE MORE EFFECTIVE

Displacement arises from a multitude of factors, that cannot alone be solved by the increases in affordable requirements and corresponding reduction in new housing delivered. More comprehensive policy frameworks that address teardowns of small-scale product and better enable locals to reap the benefits of increased capital investment in their neighborhoods should be evaluated. SOLUTIONS 43 POTENTIAL INCENTIVE PROGRAMS

EXPANSION OF DEVELOPABLE LAND & STRATEGIC UPZONING

In order to create the development capacity to hit the number of units necessary to have the ARO make meaningful headway against the city’s housing gap, the development capacity of Chicago needs to be increased. Large-scale upzonings are currently under various stages of deployment in both Seattle and Minneapolis, backed by data analysis and created in conjunction with local communities. Some sample implementations of this include:

• Advocating for a more expansive review of Chicago’s zoning, with an aim to expand housing in areas that make sense

• Expedite the sale and conversion of City-owned land toward creating more housing that will also increase the city’s property tax revenues

• Supporting and expanding the new bus transit corridor TOD designations, so they affect more routes and zoning classes

ABATEMENTS, WAIVERS AND FEE REDUCTION

In order to enable pro formas to function under the current ARO Pilot Requirements, a number of government incentives could increase feasability.Most other major U.S. metros provide extensive incentive programs along these lines. Some examples include:

• Abatement of taxes

• Waiving of permit fees

• Fast-tracking of approval

• Subsidies for constructions costs associated with affordable units.

Each of these will vary in terms of its impact and cost and must take into account the political and fiscal realities of the current environment.

A MORE FLEXIBLE ARO

Under the current ARO, restrictions on both on-site and off-site units have grown - loosening these restrictions would expand and expedite the creation of new affordable units:

• Simplify distance requirements for off-site units to same ward, thereby removing the additional 2-mile and income matching requirements which were occasionally coupled with an implied same ward requirement

• Review the requirements on like-kind for both on- and off-site units. Marginal differences in finish quality can dramatically increase the feasability of ARO units

• Similarly, like-kind requirement for off-site units encompass amenity space. These spaces average 38,000 sf in new market-rate developments. Requiring like amenity spaces in off-site developments drastically reduce the amount of space available for residential space (a valuable resource for family-targeted units) and considerably increases overall costs. 44 SOURCES

Sources Page Source 2 3 City of Chicago Quarterly Affordable Housing Report, 2014 ARO Proposed Enchancements 4 City of Chicago 5 6 Cushman & Wakefield Research 7 Cushman & Wakefield Research 8 Cushman & Wakefield Research 9 Cushman & Wakefield Research 10 11 Cushman & Wakefield Research, Recity, Reonomy, City of Chicago 12

Cushman & Wakefield Research, Recity, Reonomy, Cook County Assessor. Note: The basis for the tax calculation was the current Mill for the unrealized properties as they are, grown by 3.0% annually and added together versus the average Mill per unit (multiplied by the number of units) for new construction apart- 13 ment buildings in the same neighborhoods as the unrealized properties. This average mill per unit for this was calculated using Yardi Matrix. The same growth rate was used annually and added together over a 30 year stretch to show the dif- ference between current underutilized or vacant land and what new construction apartments could realize.

14 City of Chicago 15 16 City of Chicago 17 18 City of Chicago, Chicago Cityscape 19 20 Center for Tax and Budget Accountability 21 City of Chicago Quarterly Affordable Housing Report 22 Glassdoor, City of Chicago Quarterly Affordable Housing Report 23 24 25 Cushman & Wakefield Research, Recity 26 27 Reonomy 28 City of Chicago 29 30 City of Chicago 31 32 U.S. Census Bureau 33 Cushman & Wakefield Research, Chicago Investors Conference 34 U.S. Census: Longitudinal Employer-Household Dynamics 35 U.S. Census: Longitudinal Employer-Household Dynamics 36 Wall Street Journal, U.S. News & World Report 37 Cushman & Wakefield Research, Crain's Business 38 Cushman & Wakefield Research 39 40 Cities of Austin, Boston, Chicago, Denver, Los Angeles, Minneapolis, New York City, Portland, San Francisco, Seattle and 41 Washington, D.C. 42 Lincoln Institute for Land Policy Cities of Austin, Boston, Chicago, Denver, Los Angeles, Minneapolis, New York City, Portland, San Francisco, Seattle and 43 Washington, D.C. 44 45 45

TIME FROM APPROVAL TO PERMIT WITHIN PILOT AREAS

2002 2004 2006 2008 2010 2012 2014 2016 2018 OA LUX Apts. Jackson Throop Place Terrace 459 Cabrini Green Redevelopment- larrabee and Clybourn NEWCITY Lincoln Park Zapata Apartments - 1955 North Saint Louis & 3503 West Armitage Zapata Apartments - 3203 West Armitage City Gardens 727 West Madison 216 North May Street Arkadia Tower Warren Ashland Place 1819 Lofts Morgan Place Residences 3408-3438 North Milwaukee Avenue Xavier Apartments Kenect Gateway West Loop 2740 West North Avenue Wicker Park Lofts 832-838 West Erie Street Mode Logan Square Luxe on Madison Phase 2 1654 North Kedzie Avenue 469 North Paulina Street 1649-1659 West Grand Avenue L Logan Sqaure 1647 Milwaukee Permit Aquired Permit Aquired Permit Not Aquired Milwaukee Avenue Apartments The Fields Spoke Luxe on Chicago The Parker Fulton Market 1241 North Milwaukee Linkt Apartments 851 West MICA Clybourn 1200 1545 West North Permit The Aberdeen Monroe Aberdeen Place Centrum Bucktown 1061 West Van Buren Street 2015 ARO Noca Blu 2701 West Armitage Avenue 1955 North Richmond Street Logan’s Crossing East Village Lofts The Western 1920 Seven 10 West Ace on Ashland Vista on the Park 943 North Crosby Street

352 North Union Avenue Approval Congress Theater - Phase 1 Renovation 853 North Larrabee Peabody School Renovation John Lothrop Molley School Redevelopment Wicker Park Connection Phase 2 - Apartments Vision 2 The Palmer Bucktown Gateway 633 West North Avenue 2443 North Western Avenue Bridgford Foods Redevelopment AM 1980 740 North Aberdeen Street 1879-1885 North Milwaukee Avenue 1038 North Ashland Avenue The Van Buren 845 West Madison 2835-2845 West Belden Avenue John Pennycu Memorial Apartments 925 West Chicago Avenue Union West Milieu The Mason The Mill 2017 ARO Pilot 1122 West Chicago Avenue 1624 West Divison Street 335 West Schiller Street 1220 West Jackson Boulevard 166 North Aberdeen Street St Paul Western Lofts The Duncan 725 West Randolph Street 1750 North Western Avenue Tribune’s Freedom Center - Future Phases Tribune’s Freedom Center - Phase 1 1125 West Van Buren Street 1050 West Van Buren Street 2002 2004 2006 2008 2010 2012 2014 2016 2018 ABOUT CUSHMAN & WAKEFIELD Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 51,000 employees in 400 offices and 70 countries. In 2018, the firm had revenue of $8.2 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

Susan Tjarksen Managing Director Tel: +1 312 523 7617 [email protected]

Laura Ballou Senior Research Analyst, Capital Markets Tel: +1 630 244 2456 [email protected]

Jacob Albers Research Analyst, Capital Markets Tel: +1 510 735 4368 [email protected] multifamily.cushwake.com

© 2018 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources believed to be reliable. The information may contain errors or omissions and is presented without any warranty or representations as to its accuracy.