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East Lansing Residential Target Market

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East Lansing Residential Target Market The City of East Lansing, Michigan Residential Target Market Analysis Appendix One TMA Resources Prepared by: The City of East Lansing Target Market Analysis – Appendix One Acknowledgements This Residential Target Market Analysis (TMA) was commissioned by the City of East Lansing in 2021. The study has been completed with considerable support and dedication by the city council, planning and economic development staff, and housing commission. The local leadership team and project management was led by the following: The City of East Lansing The City of East Lansing Planning, Building, Development Housing and University Relations Thomas J. Fehrenbach, Director Annette M. Irwin, Administrator (517) 319-6887 (517) 319-6801 [email protected] [email protected] The study results are documented in five reports that have been customized for the City of East Lansing. Results of the Residential TMA are assembled this report; and it is accompanied by Appendix One (TMA Resources); Appendix Two (Demographics); and Appendix Three (Real Estate Analysis). In addition, a Housing Strategic Plan is also underway and will include an Appendix Four. The Market Analysis Reports The City of East Lansing, Michigan Residential TMA Target Market Analysis Appendix One TMA Resources Appendix Two Demographics Appendix Three Real Estate Analysis Housing Strategic Plan Housing Strategies Appendix Four Marketing Resources 1 | P a g e The City of East Lansing Target Market Analysis – Appendix One The Residential Target Market Analysis was prepared by LandUseUSA | Urban Strategies, a professional consulting firm located in the Greater Lansing Metropolitan Area. The firm specializes in utilizing Target Market Analysis methods for conducting Residential and Retail Market Studies. LandUseUSA’s contact information is provided below: LandUseUSA | Urban Strategies Sharon Woods, CRE, CNUa, President (517) 290-5531 [email protected] Note: Most of the Target Market Analyses reports completed by LandUseUSA in Michigan in 2020 and 2021 share a similar structure and outline. This is intentional and designed to help keep the reports succinct and easy to navigate. It also enables easy comparisons between several places in the State of Michigan. The City of East Lansing’s 2021 Housing Strategic Plan has been prepared by Community Image Builders (CIB Planning) of Fenton, Michigan. The recommendations documented in that report were prepared in team collaboration with LandUseUSA; and they also reflect and align with this Target Market Analysis. Contact information for CIB Planning is provided below: CIB Planning CIB Planning Technical Assistance Marketing Division Justin Sprague, VP Elena Moeller-Younger (810) 919-2901 (773) 815-3795 [email protected] [email protected] 2 | P a g e The City of East Lansing Target Market Analysis – Appendix One General Work Approach Introduction This Target Market Analysis (TMA) has focused on identifying the magnitude of potential for adding new housing units for the City of East Lansing. This study has involved rigorous data analysis and modeling and is generally based on migration into and within the city and Ingham County. It includes a study of movership rates by tenure and lifestyle cluster; and housing preferences among prospective owners and renters who are most inclined to move into East Lansing. Results of the Residential TMA and study are presented by target market (lifestyle cluster), tenure (renter and owner), building format (detached and attached), price point (value and rent), and unit sizes (square feet). It is essential that stakeholders review this Appendix One and the companion Appendix Two documents alongside the main Market Study report; because they help explain the work approach, process, and key terminology. This Appendix One focuses on Target Market Analysis (TMA) Resources, including profiles of the lifestyle clusters living in East Lansing; summary profiles of 71 lifestyle clusters across the United States by household attribute and consumer preference; and profiles of selected target markets by tenure (owner and renter). Appendix Two is a companion document that focuses on Demographics for the City of East Lansing, surrounding places, Ingham County, and the State of Michigan. It includes timeline series data for the number of existing households by tenure and income; and occupied housing units by value and rent. 3 | P a g e The City of East Lansing Target Market Analysis – Appendix One Existing Households – East Lansing Section A1 Introduction – Experian Decision Analytics has defined 71 lifestyle clusters across the nation, and assigned codes that are generally based on income. The highest income cluster (American Royalty) has a code of A01, and the lowest income cluster (Tough Times) has a code of S71. Note: See the last page of this narrative for additional information about Experian. Profiles for all 71 lifestyle clusters are provided for the City of East Lansing and with comparisons to Ingham County, Michigan. Each profile is two (2) pages long, with clusters A01 through J36 on the first page; and clusters K37 through S71 on the second page. There currently are 1,046 households in the Family Funtastic lifestyle cluster living within the City of East Lansing. In addition, there are 1,066 households in the Full Pocket Empty Nest cluster; and about 500 households in each of the following clusters: Platinum Prosperity, Picture Perfect Families, and Aging of Aquarius. There are also nearly 400 households among the following clusters: Silver Sophisticates, Status Seeking Singles, and Aging in Place. These are all relatively affluent households; and most of them tend to settle down after buying a detached house. The Family Funtastic and Full Pocket Empty Nest and Status Seeking Singles households have higher than average movership rates, which means that they are also more likely to be target markets for new-build housing units. On the more moderate end of the income spectrum, East Lansing also has 764 households among the Striving Single Scene lifestyle cluster. These households have high movership rates and they are more inclined to lease attached formats that are alternatives to traditional houses. Other clusters inclined to tolerate market-rate prices include the Wired for Success with 130 households; Bohemain Groove (214 households); Digital Dependents (118); and Family Troopers (97). 4 | P a g e The City of East Lansing Target Market Analysis – Appendix One At the lower end of the spectrum for income and price tolerance, there are 359 households among the Senior Towers or Senior Discounts; 308 households among the Reaping Rewards; and 80 households among the Town Elders and Leaders. These households tend to be good targets for small units in apartment buildings; and for small for-lease houses and townhouses with shared entrances. East Lansing’s 118 Digital Dependent households represent just 1% of the city’s total number of existing households. In comparison, this same lifestyle cluster represents 4% of Ingham County’s total households. This cluster is a target market for the city because it is already residing in the city (albeit in relatively small numbers); and because they are also residing in Ingham County in larger numbers. Similarly, although East Lansing only has 40 households in the Rooted Flower Power cluster; they represent about 5% of Ingham County’s total number of households. Therefore, this cluster also is a target market for the city; and although they are currently bypassing city, they could be intercepted by adding new and missing housing formats. 5 | P a g e The City of East Lansing Target Market Analysis – Appendix One 71 Clusters – Mosaic Descriptions Section B1 Target markets are a subset of the 71 lifestyle clusters; and they have been hand- selected for the City of East Lansing based on their a) prevalence in both Ingham County and East Lansing; b) movership rate and inclination to migrate into the Tri- County region; c) propensity to live in urban places; and d) inclination to new housing formats that align with IncDev’s step building typology. These attributes are high for some of the target markets and low for others; and the analysis measures the magnitude of market potential for both detached and attached formats. For example, only 14% of the Status Seeking Singles will choose attached housing formats; whereas 97% of the Striving Single households will choose attached units. Both of these lifestyle clusters are included among the target markets for the City of East Lansing. Five summary profiles listing all 71 lifestyle clusters are provided with a focus on the following criteria, and based on averages for the State of Michigan. In each profile, the top target markets for the City of East Lansing are shaded in blue; and all other lifestyle clusters are shaded gray. A summary of the five exhibits is provided on the below: Profiles of 71 Lifestyle Clusters – By Household Attribute 1) Share that are singles (for any reason) without children. 2) Share that move in any given year (a.k.a., movership rate). 3) Share that live in metro cities and urban places. 4) Share that are renters rather than owners. 5) Share that live in buildings with three or more units. In general, moderate-income single renters tend to have higher movership rates; are more likely to live in compact urban places; and are more likely to choose attached units. However, there are many exceptions and better-income households are also showing renewed interest in renting attached formats – especially townhouses with private entrances and private front porches or stoops. 6 | P a g e The City of East Lansing Target Market Analysis – Appendix One Across the nation, single-person households are gaining as a share of total and they now represent the majority, albeit by a small margin. Households with unrelated roommates and multi-generational households are also gaining as a share of total. These diverse householders span all ages, incomes, and tenures; and many are seeking new alternatives to detached houses.
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