SB Friedman was engaged by Artspace USA to prepare an affordable housing market study to support the development of new artist live/work space in Waukegan and Elgin, Illinois. The Karcher Artspace Lofts in Waukegan consists of the rehabilitation of the historically significant Karcher Hotel. Post rehabilitation, the development is planned to include 38 units and 2,500 square feet of retail. The Elgin Artspace Lofts includes a hybrid new construction-rehabilitated structure with a total of 48 units. Both developments feature open floor plans with flexible, multi-functional space that can be utilized as traditional living or studio space. Artspace was seeking Low Income Housing Tax Credits (LIHTCs), Tax Increment Financing (TIF funds) and HOME funds to serve as the primary sources of financing for the projects.
The market studies were prepared in accordance with IHDA’s market analysis guidelines for new construction housing. We outlined a potential market area for each project, identified and evaluated prospective competitive properties in the area, and assessed both the project’s capacity to attract renters and its ability to achieve stabilized occupancy. Considering the projects’ target tenant base, we focused on the demographic profile of specific artist-related occupations, including their gross potential income and likely age cohorts. Penetration analyses were prepared determining the demand generated from the larger renter pool, as well as from artist tenant households.