Potential Investment – Baltimore Project

Market Analysis

The University of Maryland Graduate Schools, including the Dental School, Pharmacy School, Law School, Nursing School and Medical School, share the University of Maryland campus with University Lofts. The University has over 6,000 students and 750 adjacent medical and research park employees, with the University providing housing for only 227 students, keeping off-campus housing in high demand.

Strong Housing Demand from Continued Growth of University of Maryland, Baltimore

University of Maryland, Baltimore continues to increase its curricula and graduate programs. Additionally, the University has a research park that has added many new programs and facilities with few housing options for its workers. The size of the apartments focuses on this university market with high quality, smaller units, and increased amenities. At present, the University is forced to run multiple shuttles to various neighborhoods around the city in order to accommodate their housing needs.

High Occupancy and Rents in Comparable Properties

All classes of apartments in the vicinity of the projects have an occupancy of 95% +.  While several new properties opened in 2016 Occupancy has been stable and absorption strong.  Moving forward it is anticipated that Demand will outstrip supply as recent permitted starts have slowed considerably.

Growing Demand for Center City Housing

The Downtown Partnership estimates that demand is growing for downtown apartments at a rate of over 2000 units per year.  Even with the existing pipeline, supply is not expected to grow at the same pace as demand.

Affordable Options

While a significant number of new apartments are being built in Baltimore, none are being built in the workforce category.  By using the LIHTC University Lofts will be able to service the University demand as the location develops, while undercutting the competitive supply, and still maintaining a high-quality tenant base

The Low-income Housing Tax Credit allows the project to meet this demand with little or no competition.

The University of Baltimore has a population of 25,000. many of whom will qualify as tenants in the building?  Medical Residents,  teaching assistants, Doctorate Students and several other classes of students also classify as potential tenants

Market Rent for Apartments is significantly higher than the LIHTC rents at 60% of Median Income.

LIHTC rents are just 59% to 74% of market rents. This will make the apartment portion of the project a very attractive option for the University Community.

Strong Demand From the University of Maryland

The University is a strong demand generator.  In particular, the University of Maryland Hospital and VA hospital create a demand that is currently not being met.  Additionally, this year, the Proton Cancer Treatment Center will open and attract patients from all over the world.

Strong Market Fundamentals

The competitive set for the property ran a 71% Occupancy with an Average Daily Rate of $161.00 in 2016.  The Select Service Extended Stay segment is also very strong with occupancies of most properties close to 80%.

Excellent Proximity to Demand Generators

The Hotel will be well positioned to accommodate demand from the Downtown Business District as well as the University.  Its close proximity to all downtown Baltimore venues will make it an ideal choice for many travelers.  The Hotel has on-site parking, which is a huge competitive advantage since most of the competitive hotels rely on of site parking options.

Best in Class Brand & Minimal Anticipated New Supply

The Hotel has been approved by both Hilton and Marriot as a select service site. These are both Best in Class options which should place the hotel in the top of its competitive set.  Minimal new supply is anticipated for the market.