how our methodology works

Methodologies used by VWB Research include the following:

The Primary Market Area (PMA) generated for the proposed site is identified.  The Site PMA is generally described as the smallest geographic area expected to generate most of the support for the proposed project.  Site PMAs are not defined by a radius.  The use of a radius is an ineffective approach because it does not consider mobility patterns, changes in socioeconomic or demographic character of neighborhoods, or physical landmarks that might impede development.
 
PMAs are established using a variety of factors including, but not limited to:

• A detailed demographic and socioeconomic evaluation.
• Interviews with area planners, realtors and other individuals who are familiar with area growth patterns.
• A drive-time analysis to the site.
• Personal observations by the field analyst.
• An evaluation of existing housing supply characteristics and trends.
• Information provided by management of the subject property regarding the area from which most of the support for the project currently comes.
  
  • A field survey of modern residential alternatives is conducted.  The intent of the field survey is twofold.  First, the field survey is used to measure the overall strength of the apartment market.  This is accomplished by evaluation of unit mix, vacancies, rent levels and overall quality of product.  The second purpose of the field survey is to establish those projects that are most likely directly comparable to the proposed property.
  • Comparable properties are identified through the field survey.  An in-depth evaluation of comparable properties provides an indication of the potential of the proposed development.
  • Economic and demographic characteristics of the area are evaluated.  An economic evaluation includes an assessment of area employment composition, income growth (particularly among the target market), building statistics and area growth perceptions. The demographic evaluation uses the most recently issued Census information, as well as projections that determine the characteristics of the market when the proposed project opens, and when it achieves a stabilized occupancy.
  • A review of building statistics and interviews with development officials helps to identify planned and proposed projects that will have an impact on the marketability of the proposed development.  Planned and proposed projects are always in different stages of development.  As a result, it is important to establish the likelihood of construction, timing of the project and its impact on the market and the proposed development.
  • We conduct an analysis of the proposed project's market capture into the number of income-appropriate households within the PMA.  This analysis is conducted on a total renter household level and a market capture rate is determined for the proposed development.  This capture rate is compared with acceptable market capture rates for similar types of projects to determine whether the proposed development's capture rate is achievable. 
     
    A determination of comparable market rent for the proposed subject development is conducted. Using a Rent Comparability Grid, the features of the proposed development are compared item by item with the most comparable properties in the market.  Adjustments are made for each feature that differs from that of the proposed subject development.  These adjustments are then included with the collected rent resulting in a comparable market rent for a unit comparable to the proposed unit.