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LETTER OF
TRANSMITTAL
FROM: Ken Hooge
DATE: March 25, 202
DESCRIPTION
Files
Review
By:
Inter Office
Senior Housing Partners, Inc.
2845 North Harnline Ave. Roseville, MN 55113
Phone: 651 631-64.114 C oc
Overnight
Signature
Information
Prepared for:
Washington County Housing and Redevelopment Authority
St. Paul Park, Minnesota
January 2001
A Comprehensive Study of Housing
Needs in Washington County, Minnesota
Research Inc.
615 First Avenue NE
Suite 400
Minneapolis, MN 55413
612.338.0012
January 30, 2001
Ms. Barbara Dacy
Mr. Lyn Robinson
Washington County HRA
321 Broadway
St. Paul Park, MN 55071
Research Inc.
Dear Ms. Dacy and Mr. Robinson:
Attached is our report titled "A Comprehensive Study of Housing Needs in Washington County,
Minnesota". The study provides an analysis of current housing market conditions as well as
projections of demand for housing within eight submarkets in Washington County between 2000
and 2010.
Our research indicated a need to construct nearly 20,000 additional housing units to satisfy
demand from current and future residents within the County during the decade. Specific
recommendations on the amount and type of housing needed for each of the eight submarkets
can be found at the end of each section of the report as well as in the Executive Summaiy.
We have enjoyed performing this study for you and are available should you have any questions
or need additional information.
Sincerely,
MAXFIELD RESEARCH INC.
Mary C. Bujoid
President
Enclosure
TABLE OF CONTENTS
Page
EXECUTIVE SUMMARY
DEMOGRAPHIC OVERVIEW 11
Introduction 11
Demographic Overview 11
GENERAL OCCUPANCY RENTAL MARKET OVERVIEW 30
Introduction 30
Market Rate Rental Housing 30
Subsidized Rental Housing 31
Washington County HRA Rental Subsidy Programs 32
SENIOR HOUSING MARKET OVERVIEW 35
Introduction 35
Senior Housing Inventory/Market Conditions 35
Market Rate Senior Developments 36
Affordable Senior Developments 37
Subsidized Senior Housing Developments 37
Geographic Distribution 38
Age of Senior Housing Stock 41
Pending Senior Developments 42
FOR-SALE HOUSING OVERVIEW 46
Introduction 46
Single-Family and Condominium and Townhome Resales 48
Active For-Sale Housing Developments 54
Pending For-Sale Development 55
SPECIAL NEEDS OVERVIEW 56
Introduction 56
Disability Status 56
Quarterly Shelter Survey 59
Special Needs Facilities 61
STILLWATER MARKET AREA — DEMOGRAPHIC ANALYSIS 64
Market Area Definition 64
Demographic Analysis 64
Summary of Demographic Trends 72
TABLE OF CONTENTS
(Continued)
Page
STILLWATER MARKET AREA — GENERAL OCCUPANCY RENTAL MARKET 73
Introduction . 73
Market Rate Rental Projects 73
Subsidized Rental Projects 76
Pending Rental Developments in the Stillwater Market Area 76
STILLWATER MARKET AREA — SENIOR HOUSING MARKET 78
Introduction 78
Subsidized Senior Projects 78
Market Rate Rental Projects 81
STILLWATER MARKET AREA - FOR -SALE HOUSING MARKET 83
Introduction 83
Single - Family and Condominium and Townhorne Resales 83
Active For -Sale Housing Developments 86
Pending For -Sale Development 88
STILLWATER MARKET AREA — SPECIAL NEEDS FACILITIES 90
Introduction 90
STILLWATER MARKET AREA -- CONCLUSIONS AND RECOMMENDATIONS 92
Introduction 92
Key Demographic and Market Factors 92
I -94 CORRIDOR MARKET AREA — DEMOGRAPHIC ANALYSIS 94
Market Area Definition 94
Demographic Analysis 94
Summary of Demographic Trends . 101
I -94 CORRIDOR MARKET AREA --- GENERAL OCCUPANCY RENTAL MARKET 102
Introduction 102
Pending Rental Developments 102
I -94 CORRIDOR MARKET AREA SENIOR HOUSING MARKET 103
Introduction 103
Pending Rental Developments in the I -94 Market Area 103
TABLE OF CONTENTS
(Continued)
Page
I-94 CORRIDOR MARKET AREA — FOR -SALE MARKET 104
Introduction 104
Single- Family Horne Resales 104
Active For -Sale Housing Developments. 106
Pending For -Sale Development 107
I -94 CORRIDOR MARKET AREA — SPECIAL NEEDS FACILITIES 108
Introduction 108
Special Needs Facilities 108
1 -94 CORRIDOR MARKET AREA -- CONCLUSIONS AND RECOMMENDATIONS 110
Introduction 110
Key Demographic and Market Factors 110
OAKDALE MARKET AREA — DEMOGRAPHIC ANALYSIS 112
Market Area Definition 112
Demographic Analysis 112
Summary of Demographic Trends ... 120
OAKDALE MARKET AREA — GENERAL OCCUPANCY RENTAL MARKET 121
Introduction 121
Market Area Rental Projects 121
Subsidized Rental Projects 124
Pending Rental Developments in the Oakdale Market Area 124
OAKDALE MARKET AREA — SENIOR HOUSING MARKET 127
Introduction 127
Subsidized Senior Projects 127
Affordable Senior Projects 131
Market Rate Rental Projects 132
Pending Rental Developments in the Oakdale Market Area 133
OAKDALE MARKET AREA — FOR-SALE HOUSING MARKET 134
Introduction 134
Single- Family and Condominium and Townhore Resales 134
Active For -Sale Housing Developments 136
Pending For -Sale Development 138
WASHINGTON COUNTY
Washington County Market Areas
V - Forest Lake Area
IV - White Bear Lake Area
Birchwood Village
White Bear Lake (part)
III - Oakdale Area
VII Woodbury
VIII - Cottage Grove Area
St. Paul P
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Stillwater Twp
West
Lakeland
EXECUTIVE SUMMARY
VI Northeast
Millie art St. CrO
1 - Stillwater Area
Lakeland
Lakeland Shores
Lake St. Croix Beach
St. Pilaus Point
11 - 1-94 Corridor
MAXFIELD RESEARCH INC. 2
WASHINGTON COUNTY
EXECUTIVE SUMMARY
housing, it is unlikely that the market dynamics within Washington County will provide
sufficient housing opportunities to support this group.
• A small portion of these households may be satisfied through the development of move -
up housing which will allow more affordable homes to be vacated and purchased by
younger households seeking their first home.
• We foresee the greatest gap in demand arising within the rental - housing spectrum. The
scarcity of high - density sites, sites that are not proximate to goods and services and a lack
of strong public transportation in outer suburban markets will create difficulties in serv-
ing this group and will largely result in them seeking opportunities elsewhere. This situa-
tion is important in the several larger communities in Washington County that have de-
veloped strong retail concentrations. These workers are paid relatively low wages and
this industry requires a base of workers to fill positions. In order to sustain retail growth,
this workforce must be housed.
• As housing prices rise much more rapidly compared to wage levels, people seeking
affordable housing will be forced to commute from greater distances unless that housing
is developed nearer their place of work.
• Existing senior households who have lived in Washington County for many years and
who desire to remain in their communities will need housing to serve their needs. In ad-
dition, the increasing older adult base in Washington County will result in the parents of
these older adult children desiring housing near their offspring.
• Existing land use patterns within Washington County will also constrain growth and
development as urbanized areas are reaching development saturation and development
beyond the existing Metropolitan Urban Services Area is several years away in some
cases.
Summary of Housing Needs
The following summary table matrix (Table 1A) shows the projected number of housing units
needed in Washington County by Market Area between 2000 and 2010. The matrix shows
housing needs for the various housing categories, owner and renter, single - family and multifam-
ily, general occupancy and senior, subsidized and market rate.
Although housing demand at either end of the County is mutually exclusive, demand between
market areas that are contiguous is not. To the extent that households are more mobile and
different market segments are willing to seek out various housing products in other areas of the
County or perhaps outside of the County, these numbers may experience slight fluctuations
between Market Areas.
MAX FIELD RESEARCH INC.
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WASHINGTON COUNTY
Household Growth
Table 1B shows household growth separated by household tenure, owner and renter, for each
Market Area in Washington County. The table shows estimates and projections of household
growth by Market Area from 1 990 through 2020 by decade.
The table reveals that Woodbury is projected to experience the greatest growth over the next
twenty years despite a slowdown in the early portion of the 2000s. Woodbury is expected to be
followed by the Cottage Grove Market Area and then the Stillwater Market Area. The Oakdale
Market Area is expected to exhibit less growth due to scarcity of available land for new devel-
opment. However, a recently approved open space development ordinance in Lake Elmo now
allows for up to .40 units per acre. This change is expected to encourage additional residential
development in this community in the future.
Market ket Conditions
• Home prices are rising rapidly. Over the past five years, the median hone price in
Washington County rose 52.8%, compared to 36.5% for the Twin Cities Metropolitan
Area as a whole. A portion of this increase is a result of the higher proportion of newer
housing in many communities in Washington County. Nevertheless, home values are
rapidly escalating beyond the ability of moderate- income households to afford them.
• Rental vacancy rates are very low all across Washington County, well below the 5% level
considered standard in a healthy rental market. Washington County is no exception
within the Metro Area where rental vacancy rates have continued to remain below 5% for
several years. A substantial lack of construction during the 1990s and continued house-
hold growth has resulted in a very tight market. Now, due to rising land and construction
costs, market rate general occupancy rental housing has been developed only at the upper
end of the rent spectrum. This situation has fueled a move --up renter situation sufficient
enough to sustain our continued low vacancy rates. However, rising rents at older prop-
erties have placed a burden on many renters who rent because of economic necessity.
• Rental vacancy rates across the Twin Cities Metropolitan Area continue to remain low.
Even the significant amount of rental housing developed in Woodbury over the past two
years caused the vacancy rate to rise above 5.0% for only one quarter after which time, it
fell to roughly 3.3 %. This is testament to the substantial pent-up demand that existed in
Woodbury for rental housing at that time.
• Developing sufficient affordable rental housing has become a critical issue across the
Twin Cities Metropolitan Area and, even through public /private partnerships, we have
been unable to develop enough moderate -price rental housing to support demand. Pro-
grams instituted through the Minnesota Housing Finance Agency (specifically the 4 (d)
program -- Property Tax Classification) have not had a strong response from the devel-
opment community. In communities where moderate rent or low rent housing has been
developed, it has been the result of a combination of funding sources all combined to re-
MA FIELD RESEARCH INC.
EXECUTIVE SUMMARY
5
WASHINGTON COUNTY
EXECUTIVE SUMMARY
duce the rent levels sufficiently and maximize the market through relatively generous in-
cone qualifications.
Demand Calculations
Tables IC and ID show the calculation of owner and renter demand by Market Area for Wash-
ington County. The demand calculations show demand for various housing categories, owner
and renter, single - family and multifamily, general occupancy and senior, subsidized and market
rate for each of the eight Market Areas in Washington County.
• Although housing demand at each end of the County is mutually exclusive, demand
between Market Areas that are contiguous is not. To the extent that households are more
mobile and different market segments are willing to seek out various housing products in
other areas of the County or perhaps outside of the County, these numbers may experi-
ence slightly fluctuations between Market Areas.
• Demand exists for a variety of housing product types within each Market Area. Each
Market Area is not likely to develop housing that will meet the needs of all market se-
ments, due to land use restrictions, funding allocations and other considerations (prox-
imity to goods and services, transportation, etc.). Although it is important to encourage a
variety of housing products within each Market Area to meet the needs of households in
the County, some needs may go unmet and/or need to be satisfied elsewhere.
• Entry -level housing is also a significant need within the County and one that is rapidly
becoming more difficult to provide. Rising land and construction costs are pricing hous-
ing out of reach of many young households. While there is some entry -level housing
turnover, the number of move -up housing units developed as compared to entry-level
over the past several years has reduced the availability of these units in the marketplace.
• Our interviews throughout the County revealed a strong need for moderate price rental
housing to serve families, young workers and lower income seniors. To the extent that
the County can encourage the development of this type of housing would assist in provid-
ing workers to local businesses and enhance the economic base of the County and retain
long-standing residents of the area.
• There is also a significant need within the County for transitional housing that will
provide support services for households that cannot easily mainstream into the primary
housing market. For this group, lifestyle and other emotional and financial issues make it
difficult for them to stabilize their living situations. Often it is a matter of providing a
transitional living situation to enable them to eventually mainstream into the traditional
housing market.
MAXFIELD RESEARCH INC.
6
WASHINGTON COUNTY
Market Areas
Stillwater-1
1-94 - 11
Oakdale - III
White Bear Lake - IV
Northeast - V
Forest Lake - VI
Woodbury - VII
Cottage Grove - VIII
Total - Washington Cty.
Market Areas
Stillwater-I
1-94 - II
Oakdale - 111
White Bear Lake - IV
Northeast - V
Forest Lake - VI
Woodbury - VII
Cottage Grove - VIII
Total - Washington Cty.
MAXFIELD RESEARCH INC.
TABLE 113
GROWTH OF WASHINGTON COUNTY HOUSEHOLDS BY MARKET AREA
1990-2020
4 11: :
1990-2000 1
2000-2010 1
2010-2020 I
No. Pct.
136 7.2
25 2.5
660 17.7
114 6.7
15 3.0
80 7.1
1,381 15.9
281 7.9
2,692 12.1
No. Pct.
550 20.2
100 20.0
500 19.3
500 20.1
65 20.3
320 20.0
1,000 18.5
900 21.0
3,935 19,8
1 1990-2000 1
No. Pct.
[ 2000-2010
No. Pct.
1,751 92.8 2,175 79.8
967 97.5 400 80.0
3,068 82.3 2,090 80.7
1,578 93.3 1,990 79.9
491 97.0 255 79.7
1,046 92.9 1,280 80.0
7,292 84.1 4,400 81.5
3,279 92.1 3,395 79.0
19,472 87.9 15,985 80.2
Sources: Bureau of the Census; Metropolitan Council; Maxfield Research Inc.
No. Pct,
580 19.4
19.2
23.5
100
600
550
50
340
1,000
900
18.7
20.0
20.0
20.0
20.2
4,120 20.2
2010-2020
2,410 80.6
420 80.8
1,950 76.5
2,390 81.3
200 80.0
1,360 80.0
4,000 80.0
3,550 79.8
16,280 79.8
EXECUTIVE SUMMARY
Census Estimate Projection
1990 2000 2010
24.8 21.4 21.2
7.0 5,9 7.5
16.2 16.6 17.1
8.2 7,9 11.0
6.9 6.2 7.7
25.1 21.5 21.1
20.2 17.8 18.0
11.6 10.7 13.1
16.1 15.0 16.0
Census Estimate Projection
1990 2000 _2010
75.2 78.6 79.0
93.0 94.1 94.3
83.8 83.4 84.1
91.8 92.1 89.2
93.1 93.8 93.8
74.9 78.5 79.7
79.8 82.2 81.5
88.4 89.3 89.0
83.9 85.0 84.0
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WASHINGTON COUNTY EXECUTIVE SUMMARY
The demand calculations continue to show strong demand for move -u p housing. . This is a result
of the aging baby boom generation. Based on a shift in demographics ointin to a somewhat
p g
reduced demand for move -up housing in the 2000s, we do not believe that this shift will si g nifi-
cantly affect Washington County as the mobility of households in the Twin Cities Metro Area
will allow people to cross market areas to find the housing they seek. This will continue to
provide strong demand for move -up housing in Washington County, although the need for entry-
level and moderate price housing will increase as a proportion of total housin g needs. Also
rental demand will continue to remain strong despite the lack of product that has been developed
to date.
Development Programs
Appendix A lists programs available for the development of housing and are not restricted to
rural communities. We are seeing today that developing affordable housing has not been easy
and that those developments that have been built are typically a combination of several different
sources of funding and subsidies to make them work. Programs that have been successful in the
past include essential function bonds, tax exempt bond financing and tax credit developments.
Essential function bonds however are not backed by the guarantee of the community or the
bonding entity that may restrict their ability to be sold via public sale.
MAXFIELD RESEARCH INC.
10