Challenge
Allegro was engaged by a private firm that was interested in developing a multi-phase development of 100+ large, high-end condominiums in a northeast Ohio. A portion of the units would be adapted to reuse the space of a historic industrial property, and the project also had the potential to include a small portion of retail. This type of housing product had never been built before in this municipality. The developer engaged Allegro to determine the economic feasibility of the project.
Solution
Allegro first conducted market research, including demographics, traffic counts, an analysis of existing residential housing in the area, and a survey of any recently-built housing comparable to the planned project. They also interviewed the developers of the few recently developed for-sale multi-family housing projects in the market area. Allegro sought to determine what made those projects succeed or fail, the sales pace, buyer demographics, challenges, and lessons learned.
Allegro then took a look at consumer spending, retail sales, and retail leakage in the area to round out the study. At the request of the client, Allegro made further observations about the office market conditions— information that would be needed if the project was to change.
Ultimately, after careful analysis of the data, Allegro determined the proposed residential development could NOT be supported at the client’s desired price point.
