The Streetcar Effect - Analyzing Real Estate Values In Tucson

The Streetcar EffectPE R FO R MA NCE O F R E SIDENT IA L R E A L E STAT EWIT HIN ½ MILE OF T UCSON ST R EETCAR R OUT EVS T HE T UCSO N MSA

©2015 Kent Simpson

Prepared for Senator Bob WorsleyAZ Senate Transportation Committee Chair

Performance Metrics:

• Rate of Transaction Growth/Decline

• Rate of Average Value Growth

• Rate of Value Growth marked by periods in timeline

Percentage Growth In Transactions:

Numbers of Transactions “Spike” At Each Stage of Development T R A N S ACT IO NS J U MP ED 5 2% B E T WE E N 20 0 6 & 20 0 7 A F T E R

R TA PA S S E S WIT H S T R E E TCA R A S PA R T O F PACK AG E

A NNO U NCEMENT O F T IG E R G R A NT (CO MPLET ING FU ND ING O F S T R E E TCA R) F O L LO WED B Y 23 .4% J U MP IN T R A N S ACT IO NS

CO N S T R UCT IO N O F S T R E E TCA R L IN E B R IN G S 1 4.4% R IS E IN T R A NSACT IO NS

***D ATA ON TR A N SAC TI ONS TOO E A R LY F OR R E SU LTS A F TE R B E GI NN ING OF SE R V I C E

Property Values Rise & Outpace Tucson Market

Average Value Very Similar Prior To RTA Vote

2000-2002 Almost Identical

Values rise quicker during

“boom” period

Values gained are held stronger

through “bust” and beginning

of recovery.

Since Announcement, Value Performance Has Outpaced The Rest of The Market

©2015 Kent Simpson All Rights Reserved

DURING CRASH, VALUES FELL AT A RATE 88% LESS THAN THE REST OF TUCSON MARKET

DURING EARLY STAGES OF RECOVER, THE STREETCAR MARKET DOUBLED THE PERFORMANCE OF THE TUCSON MSA

Commercial Development

Student Housing, Market Rate Apartments &Downtown Core Showing Earliest Returns:

Nearly 3000 beds in private student housing projects alone (The District on 5th – 760 beds – built for $33MM, sold for $67MM within 1 year of completion).

The Herbert - 144 apts1 North 5th – 96 apts & retail1 E Broadway – 24 luxury apts & retail

212 New Businesses in Downtown Core opened since 2008

Marriott AC Hotel breaking ground in MayMarriott Residence Inn proposed next to University Marriott

20+ Story Retail/Office/Residential project in proposal at northern end of streetcar

Rio Nuevo/NorGen deal across from convention center just signed

The RenaissanceOf Downtown

Development Spurs Development

Conclusion:The Tucson Modern Streetcar has brought about a marked benefit to the Residential Real Estate Marketplace.

The numbers just don’t lie.

©2015 Kent Simpson

For More Information Contact:

Kent SimpsonNAR® & AAR® Board of Directors

Simpson/Basch Partners ofTierra Antigua Realty-Downtown

216 E Congress StreetTucson, AZ 85701

[email protected]