HomeMy WebLinkAbout2016-01-12 Agenda and Supporting Documentation Town Council Regular MeetingVAIL TOWN COUNCIL
SPECIAL MEETING AGENDA TOWN OF4� 0i
VAIL TOWN COUNCIL CHAMBERS
75 S. Frontage Road W.
Vail, CO 81657
10:30 A.M., JANUARY 12, 2016
NOTE: Times of items are approximate, subject to change, and cannot be relied
upon to determine at what time Council will consider an item.
Public comments on work session item may be solicited by the Town
Council
1. ITEM/TOPIC: Summit County Tour of Affordable Housing Properties
Tour itinerary below:
10:30 AM Depart Vail Municipal Building (Town of Vail bus)
11:30 AM Arrive at Town of Breckenridge Offices to meet with Breckenridge
Community Development and Housing Staff (lunch will be served)
1:15 PM Depart for tour of Valley Brook Neighborhood, 1100 Airport Road,
Breckenridge
2:00 PM Depart for tour of Peak One Neighborhood, 257 Belford Street, Frisco
2:45 PM Depart Frisco for Vail
3:30 PM Arrive at Vail Municipal Building
BREAK UNTIL 6 PM
PRESENTER(S): George Ruther, Director of Community Development, Alan
Nazzaro, Housing Manager
2- ITEM/TOPIC: Discussion with the Vail Town Council to clarify the vision for the
Chamonix development and determine the target market of the future home
owners at Chamonix. Public comment will betaken. (120 min. )
PRESENTER(S): George Ruther, Director of Community Development, Alan
Nazzaro, Housing Manager
BACKGROUND: The purpose of this special meeting is to seek clarification from
the Vail Town Council on the vision for future development on the Chamonix site
in West Vail and to determine the target market of the future home owners at
Chamonix. In doing so, first, a number of key considerations will be shared with
the Town Council in an effort to provide information, background and context.
Considerations such as the existing inventory of deed restricted housing within
the community, the gap in affordability faced by prospective homeowners, the
results of three market studies and an overview of the strategic planning efforts
which have been completed to date to make affordable housing on the Chamonix
site a reality. In the end, the Town Council is being asked to answer a number of
key questions to assist in determining their vision for the future development on
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the Chamonix site.
This action helps achieve the Town Council's adopted goal of "growing a thriving
and balanced community".
3. ITEM/TOPIC: Adjournment (8:00 p.m.)
Please call (970) 479-2136 for additional information. Sign language
interpretation is available upon request with 48-hour notification. Please call
(970) 479-2356, Telecommunication Device for the Deaf (TDD), for
information.
1/12/2016
TOWN OF VAIN
VAIL TOWN COUNCIL AGENDA MEMO
MEETING DATE: January 12, 2016
ITEM/TOPIC: Summit County Tour of Affordable Housing Properties
Tour itinerary below:
10:30 AM Depart Vail Municipal Building (Town of Vail bus)
11:30 AM Arrive at Town of Breckenridge Offices to meet with Breckenridge Community
Development and Housing Staff (lunch will be served)
1:15 PM Depart for tour of Valley Brook Neighborhood, 1100 Airport Road, Breckenridge
2:00 PM Depart for tour of Peak One Neighborhood, 257 Belford Street, Frisco
2:45 PM Depart Frisco for Vail
3:30 PM Arrive at Vail Municipal Building
BREAK UNTIL 6 PM
PRESENTER(S): George Ruther, Director of Community Development, Alan Nazzaro,
Housing Manager
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Towx of vn' 1[1
VAIL TOWN COUNCIL AGENDA MEMO
MEETING DATE: January 12, 2016
ITEM/TOPIC: Discussion with the Vail Town Council to clarify the vision for the Chamonix
development and determine the target market of the future home owners at Chamonix.
Public comment will be taken.
PRESENTER(S): George Ruther, Director of Community Development, Alan Nazzaro,
Housing Manager
BACKGROUND: The purpose of this special meeting is to seek clarification from the Vail
Town Council on the vision for future development on the Chamonix site in West Vail and to
determine the target market of the future home owners at Chamonix. In doing so, first, a
number of key considerations will be shared with the Town Council in an effort to provide
information, background and context. Considerations such as the existing inventory of deed
restricted housing within the community, the gap in affordability faced by prospective
homeowners, the results of three market studies and an overview of the strategic planning
efforts which have been completed to date to make affordable housing on the Chamonix site a
reality. In the end, the Town Council is being asked to answer a number of key questions to
assist in determining their vision for the future development on the Chamonix site.
This action helps achieve the Town Council's adopted goal of "growing a thriving and balanced
community".
ATTACHMENTS:
Staff Memorandum
2014 Chamonix Market Study Letter
Market Study 2014
Chamonix Master Plan
Chamonix Informational Update Memorandum 12172013
Employee Housing Inventory
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Memorandum
To: Vail Town Council
From: George Ruther, Director of Community Development
Alan Nazzaro, Housing Manager
Date: January 12, 2016
Subject: Public meeting with the Vail Town Council to clarify the vision for the Chamonix
neighborhood and determine the target market of the future homeowners at
Chamonix.
I. Purpose of the Meeting
The purpose of this public meeting is to seek clarification from the Vail Town Council on the
vision for future development at the Chamonix neighborhood in West Vail and to determine the
target market of the future homeowners. In doing so, first, a number of key considerations will
be shared with the Town Council in an effort to provide background and context.
Considerations such as the existing inventory of deed restricted housing within the community,
the gap in affordability faced by prospective homeowners, the results of three market studies
and an overview of the strategic planning efforts which have been completed to date to make
affordable housing on the Chamonix site a reality. In the end, the Town Council is being asked
to answer a number of key questions to assist in determining their vision for the future
development within the Chamonix neighborhood.
This action helps achieve the Town Council's adopted goal of "growing a thriving and balanced
community'.
II. Project Goals and Objectives
A list of project goals and objectives has been adopted for the future development on the
Chamonix site. The project team has relied upon these goals and objectives throughout the
planning process. On April 15, 2014, the Vail Town Council affirmed and adopted the following
project goals and objectives:
• Optimize the use of the site for affordable for -sale housing (15 - 25 du's per acre)
• Design a context sensitive design solution (design review guidelines)
• Ability to be phased over time (min. two phases)
• Deliver desirable, marketable and diverse types of housing products (duplexes; one,
two & three bedroom flats; townhomes, etc.)
• Maximize the town's limited supply of financial resources
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• Build responsibly given the existing site configuration, topography and natural features
of the site
• Develop a diversified cost/sales structure to respond to a wider range of buyers
(i.e. pricing structure based upon income)
III. Housing Inventory
In October of 2015, an Inventory of Existing Employee Housing Units in the Town of Vail
was compiled by the Community Development Department (see attached Table 1). This
inventory consists of 737 total units with 665 being rental and 72 for sale. The
breakdown of bedroom mix is 86 efficiency, 149 one -bedroom, 392 two-bedroom 74
three bedroom, and 28 four-bedroom units. The average size of the units range from a
minimum of 460 square feet for an efficiency to a maximum of 1,552 square feet for the
three-bedroom unit. 86.43% of the total inventory is made up of efficiency, one and two-
bedroom units. The smaller percentage (13.84%) of higher bedroom units partially
explains the down valley movement of families to locations with more suitable sized
housing within which to grow.
In 2006, the Vail 20/20 Focus on the Future process resulted in the following housing
goal statement:
"The Town of Vail recognizes the need for housing as infrastructure that
promotes community, reduces transit needs and keeps more employees living in
the town, and will provide enough deed restricted housing for at least 30 percent
of the workforce through policies, regulations and publicly initiated development."
In 2008 the Vail Town Council adopted the Employee Housing Strategic Plan. This Plan
states,
"Based upon the community's work, the Vail Town Council has confirmed the
Town of Vail recognizes deed restricted employee housing as basic
infrastructure. This type of housing allows employees to live within the town,
promoting community, and improving the quality of our local workforce, thereby
supporting the local economy, and reducing regional transit needs."
The Town has faced this issue of housing throughout its existence. One of the first
buildings erected by Vail's founders was a hostel for employees. Over the years the
Town has been initiated regulations to assist with the provision of EHUs, i.e.,
commercial linkage and inclusionary zoning. They have incentivized development
through density bonuses and EHU exchanges. They have also engaged in sponsorship
of EHU development.
Town has sponsored employee housing developments as a catch up strategy to fill
gaps in the employee housing inventory over the years. To date, the Town has
sponsored the development of for -sale, deed restricted units that are priced to be
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permanently affordable to local employees. The Town's master deed restriction further
enhances affordability by being Federal National Mortgage Association (FNMA)
approved, allowing buyers to obtain mortgages on the secondary market.
The master deed restriction recorded for Vail Commons, Red Sandstone, North Trail,
Arosa Duplex and Buy Down Units includes:
✓ Maximum annual price appreciation of 3% per year (prorated at the rate of 0.25%
for each whole month of any part of a year).
✓ Permitted Capital Improvements may be recouped and shall not exceed 15% of
the purchase price for every ten-year period.
o Increased from 10% and Permitted Capital Improvements was expanded
to include replacement flooring, appliances, etc. on a five-year
depreciation schedule.
✓ Owner shall use the unit as their permanent residence.
✓ Owner shall not own any interest in another developed residential property in
Eagle County.
o Exception made during new construction — time of construction allows
prospective purchasers to sell their free market unit prior to closing on the
Town of Vail deed restricted unit.
✓ Owner may rent the unit for a limited period of time, with Town approval, but not
as an income producing asset.
✓ Nothing precludes an owner from sharing occupancy of the unit with non -owners
on a rental basis.
✓ Units are resold through the Town.
✓ The deed restriction does not survive foreclosure.
This direct involvement by the Town has resulted in four EHU developments within the
borders of Vail: Arosa Duplex, North Trail Townhomes, Red Sandstone and Vail
Commons for a total of 79 units of 1, 2 and 3 -bedroom homes.
Demoaraahics Overview of Current Priced Capped EHU Owners
Arosa Duplex (2 units completed June 2010)
• Average age of owners is 37 years old
• Average length of ownership is 4 years 7 months
• Both owners were 1 st time homebuyers
Units are owned 100% by couples
North Trail (6 units completed May 2001)
• Average age of owners is 52 years old
• Average length of ownership is 10 years 5 months
• There are 3 original owners
• Owners have been 1 st time homebuyers (50%) or from Vail Commons (50%)
• Units are owned 66% by women, 17% by men, and 17% by couples
Red Sandstone (18 units completed September 1999)
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• One-half of the units are owned by individuals (9 units)
• Average age of individual owners is 43 years old
• Average length of ownership is 7 years 8 months
• Individual owners have all been 1St time homebuyers
• Owners of 2 units were born and raised in Vail
• Units are owned 44% by couples, 33% by women, and 22% by men
Vail Commons (53 units completed in 1996-1997)
• Average age of owners is 53 years old
• Average length of ownership is 11 years
• 1St time homebuyers or current Vail Commons owners purchase resales
• Original purchasers own 42% (22) of the units
• Owners of 2 units were born and raised in Vail
• Three-bedroom unit resales have been purchased 50% by Vail Commons two-
bedroom unit owners 50% of the time and 1 at time homebuyers
• Units are owned 52% by men, 27% by couples, and 21 % by women
Demographics of All Properties
• 52 years old is the average owner's age
• 34% of owners are married
• 23% of owners have children
• 6% of units are owned by people born and raised in Vail
• 84% of units had at least one owner employed in Vail in 2013
Town of Vail as an Employer
The Town of Vail is not only the municipal government, it is also an employer. As an employer,
the Town has a goal of providing deed restricted housing for at least 30% of its workforce in
Vail. The benefits of doing so are:
• Improves employee recruitment and retention
• Keeps critical service employees geographically accessible
• Reduces over -time costs by enabling the Town to be more fully staffed
• Stabilizes employment costs
• Reduces employee commuting times and distances
To meet the goal the Town provides:
• Seasonal and long-term rentals
• Priority for deed restricted purchases at Red Sandstone Creek
• Down payment assistance loans and rental assistance loans
• Reduced monthly rental rates
The Town of Vail employs +/- 345 people. Today, 69 (+/-20%) Town employees live in 52 Town -
owned rental units.
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Number of Town Employees
in Town -Owned Rental Units
Critical Employees
Essential
Employees
Source: Town of Vail Human Resources
OVERVIEW OF CURRENT EMPLOYEE RENTERS
• Average age ranges from 25-40
• Average employee tenure — 5 years or less (seasonal employees
excluded)
• Currently there are two families with children in Town -owned rental
housing
• 90% of residents are single
IV. Affordability Gap
As part of the subsidy policy discussion staff was asked to prepare policy options that
ensures a wide range of buyers. In order to accomplish this, staff had to take into
consideration the Affordability Gap and Housing Affordability Index, which are used to
determine the level of subsidy needed.
The home purchase "affordability gap" (AG) is defined as the difference
between the price that the average household can afford to pay for a home and
the median price of housing on the market.
Another indication of affordability in a given community is determined by
calculating the Housing Affordability Index (HAI).
o The HAI measures whether a typical family can qualify for a mortgage
loan on a typical home.
o The typical family is defined as a four person household earning 100% of
the AMI, as reported by HUD.
o The prevailing mortgage interest rate is the effective rate on loans closed
on existing homes from the Federal Housing Finance Board.
o A HAI Value of 100 means that a typical family earning 100% of the Area
Median Income has enough income to qualify for a mortgage on a
median -priced home, assuming a 20 percent down payment.
o An increase in the HAI, then, indicates that this family is more able to
afford the median priced home.
1/12/2016
For example:
• The median price for a home in Vail increased to $1.4 million, in the second
quarter of 2015.
• The median income for a family of four for Eagle County for 2015 was $86,200
• The Affordability Index for Vail equals 23
o Which means the typical family needs to earn more than three times their
current income to be able to afford the typical Free Market home in this
community.
• The corresponding affordability gap is:
o $1.4 million - $320,000* _ $1.08 million
V. Area Median Income
There are a myriad of terms used in housing that can be confusing because they are
related to or generated by the use of government regulated funding programs. One of
the key terms is Area Median Income (AMI), because it is often AMI categories that are
used for when developing pricing and subsidy policies. Here are some relevant terms
and definitions:
1. Median income is the amount that divides the income distribution into two equal
groups, half having income above that amount, and half having income below
that amount.
2. Area Median Income is the median income of a state or an area within a state
established annually by HUD to set income limits for various funding programs.
HUD uses Census data supplemented with Bureau of Labor Statistics data, as
well as state and local data to estimate these income levels by size of household
and publishes them for use by grantees nationwide.
3. Family means all persons living in the same household who are related by birth,
marriage or adoption.
4. Household (HH) means all persons who occupy a housing unit. The occupants
may be a single family, one person living alone, two or more families living
together, or any other group of related or unrelated persons who share living
arrangements.
5. Household Income - This includes the income of the householder and all other
individuals 15 years old and over in the household, whether they are related to
the householder or not.
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The HUD established AMI levels by household size for Eagle County are available on
the Colorado Housing Finance Authority (CHFA) website and Table 1 below lists the
2015 levels for 1-4 person HH.
Table 2 - 2015 Area Median Income - Eagle County
AMI
1
2
3
4
2
Person
Persons
Persons
Person
_
140%
$84,560
$96,600
$108,640
_Persons
$120,680
130%
$78,520
$89,700
$100,880
$112,060
120%
$721480
$82,800
$93,120
$103,440
110%
$661440
$75,900
$85,360
$94,820
100%
$60,400
$69,000
$77,600
$86,200
90%
$54,360
$62,100
$69,840
$77,580
80%
$48,320
$55,200
$62,080
$68,960
70%
$42,280
$48,300
$54,320
$60,340
60%
$36,240
$41,400
$46,560
$51,720
Source: Colorado Housing and
Finance Authority
$169,000
To calculate the maximum affordable prices for these targeted households, the following
assumptions are used:
• The monthly mortgage payment equals 30% of gross household income;
• The monthly mortgage payment includes estimated property taxes, homeowner
insurance and HOA fees;
• Down payments of 5% of the purchase price; and
• The interest rate is 5.0% for 30 -years. If rates rise the amount that households in
the targeted income range can afford would decrease.
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Table 3 - Maximum Affordable Prices
AMI
1
2
3
4
Person
Persons
Persons
Persons
140%
$309,000
$361,300
$408,000
$475,000
130%
$282,000
$333,000
$378,250
$431,500
120%
$255,000
$305,000
$348,500
$388,000
110%
$229,000
$275,000
$314,000
$354,000
100%
$203,000 1
$245,000
$283,500
$320,000
90%
$178,000
$214,000
$248,000
$278,500
80%
$153,000
$183,000
$213,500
$240,000
70%
$126,000 1
$152,350
$180,000
$204,500
60%
$100,000
$121,700
$157,500
$169,000
Source: staff calculations
using an affordable housing calculator
To calculate the maximum affordable prices for these targeted households, the following
assumptions are used:
• The monthly mortgage payment equals 30% of gross household income;
• The monthly mortgage payment includes estimated property taxes, homeowner
insurance and HOA fees;
• Down payments of 5% of the purchase price; and
• The interest rate is 5.0% for 30 -years. If rates rise the amount that households in
the targeted income range can afford would decrease.
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Table 4 below illustrates the effect of sales/cost policy whereby units are priced at cost
of vertical construction and the only subsidy being the contribution of the land and
infrastructure into the development. As is demonstrated, a 1 -person household at 100%
of AMI can afford a 680 square foot unit at $300 per cost per square foot. The table
further demonstrates that the range in size of units affordable to all households at 100%
of AMI range from 680 square feet to 1,067 square feet in size. The largest sized unit
that 3 and 4 -person households can afford is 940 and 1,067 square feet, respectively.
Table 4 Estimated Home Price based on Estimated Construction Cost
Note: Same assumptions were used for these calculations as Table 3 above
Table 5 below illustrates the estimated subsidies required for 1 — 4 person households
earning 100% of AMI to afford units of a reasonable size for the corresponding size of
household. The calculations assume an estimated cost of $300 per square foot for
vertical construction only. The data demonstrates that the cost of moderately sized
units, even without land and infrastructure factored into the equation, have an
affordability gap for households at 100% of AMI. The additional subsidies required to
make these units affordable range from $28,500 per unit for a 615 square foot unit to
$220,000 for an 1,800 square foot unit.
Table 5 Subsidies Needed Based on Size of Unit & Estimated Construction Cost
HH Size
Max
Affordable
Price with 5%
Down
Maximum
Price of Home
at $300/sq. ft.
Price Home
at $350/sq. ft.
Affordable
Subsidy
Needed at
$350/sq. ft.
1 -person
$204,000.00
Price with
$184,500.00
$215,250.00
Square
$11,250.00
2 -person
$249,000.00
5% Down
$277,500.00
Assumed
Footage at
Affordable
3 -person
Eagle County
and 5%
Mortgage
Monthly
$300/sq. ft.
Square Footage at
HH Size
100% of AMI
Interest
Amount
HOA
Cost
$350/sq. ft. Cost
1 -person
$60,400.00
$204,000.00
$193,800.00
$ 350.00
680
583
2 -person
$69,000.00
$249,000.00
$232,750.00
$ 340.00
830
711
3 -person
$77,600.00
$282,000.00
$267,900.00
$ 345.00
940
806
4 -person
$86,200.00
$320,000.00
$304,000.00
$ 365.00
1,067
914
Note: Same assumptions were used for these calculations as Table 3 above
Table 5 below illustrates the estimated subsidies required for 1 — 4 person households
earning 100% of AMI to afford units of a reasonable size for the corresponding size of
household. The calculations assume an estimated cost of $300 per square foot for
vertical construction only. The data demonstrates that the cost of moderately sized
units, even without land and infrastructure factored into the equation, have an
affordability gap for households at 100% of AMI. The additional subsidies required to
make these units affordable range from $28,500 per unit for a 615 square foot unit to
$220,000 for an 1,800 square foot unit.
Table 5 Subsidies Needed Based on Size of Unit & Estimated Construction Cost
HH Size
Max
Affordable
Price with 5%
Down
Estimated
Sq. ft.
size
Price of Home
at $300/sq. ft.
Price Home
at $350/sq. ft.
Subsidy
Needed at
$300/sq. ft.
Subsidy
Needed at
$350/sq. ft.
1 -person
$204,000.00
615
$184,500.00
$215,250.00
0
$11,250.00
2 -person
$249,000.00
925
$277,500.00
$323,750.00
$28,500.00
$74,750.00
3 -person
$282,000.00
1,550
$465,000.00
$542,500.00
$183,000.00
$260,500.00
4 -person
$320,000.00
1,800
$540,000.00
$630,000.00
$220,000.00
$310,000.00
Note: Same assumptions were used for these calculations as Table 2 above
VI. Market Study Summary
A total of three independent market studies have been prepared for the Vail Town Council for
the Chamonix site. Two studies were completed by Economic & Planning Systems, and more
recently, a third study was prepared by Rees Consulting, Inc. In each instance, the overriding
conclusion of the studies has been the same;
"market conditions appear to be prime now for proceeding with the development of
Chamonix".
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1/12/2016
In summary, the studies conclude the following:
• The economy is recovering with growth in jobs and significant reductions in
unemployment.
• The real estate housing market is rebounding.
• Deed restricted units in Vail perform well, remain 100% occupied and command the
maximum allowable resale price at closing.
• The inventory of deed restricted units within Vail and located down valley is not growing
to meet current market demand.
• Rental availability is increasingly limited and rising rental rents are within the range of
potential cost of home ownership at Chamonix.
• Households most likely to purchase a home at Chamonix have an income in the 60% to
140% AMI range with a low required capture rate of less than 4%.
Most recently, Melanie Rees, of Rees Consulting, Inc. recommended the following with
regard to future development on the Chamonix site:
• The pricing and value of homes at Miller Ranch should be considered when designing
and setting home prices for Chamonix. (competition)
• Prices should be primarily affordable for households in the 80% to 120% AMI range.
(wider range of buyer)
• Prices should set slightly lower than the maximum affordable levels. (affordable)
• Pricing should be structured using income tiers where deed restrictions impose income
limits. (affordable/diverse sales & cost structure)
• Price should be set with the expectation that interest rates will rise. (affordable)
• A variety of unit types (flats, townhomes, duplexes and single family) and sizes should
be provided. (desirable and marketable)
• Consideration should be given to providing fewer flats and more townhomes to address
phasing, livability, buyer preference, marketability, mortgage availability, etc. (desirable
and marketable)
• Work with local lenders to obtain approval of deed restrictions to broaden the availability
of loan products. (affordable/desirable and marketable)
• Obtain Fannie Mae and FHA direct approval of the development. (affordable)
• Assist prospective buyers with educational information on loan products to aid in sound
financial decision making.
• To enhance livability and competitiveness, the following amenities are recommended:
o Enclosed garages with a minimum of two spaces per unit
o Adequate storage suitable for bikes, skis, snowboards, etc.
o Small fenced areas for children and pets
o Functional common outdoor areas
o Access to sunlight and views
o Mud rooms
o Sound proofing and noise attenuation
o Energy efficiency
o Pedestrian connectivity (desirable and marketable)
A copy of the Market Study has been attached for reference
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1/12/2016
VII. Master Plan Overview
A Master Plan was finalized in early 2009 for the town -owned, 3.6 acre parcel known as the
Chamonix site. According to this plan, the site is to be rezoned to the Housing (H) District and
100% of the homes developed on the site should be deed -restricted, for -sale employee housing
units, as defined by the Town's Zoning Regulations. The vision for the site going into the
master planning process called for a variety of units types and sizes aimed a serving families
(min. three persons per household) with incomes between 60% and 120% of the Eagle County
Area Median Income (AMI), possibly ranging as high as 140% and greater AMI.
Upon considering and evaluating three possible development scenarios for the site, the
Neighborhood Block scheme was selected. This Scheme envisions a mix of residential unit
types and sizes with a density (dwelling units per acre) of approximately 16 du/acre. Vehicular
access to all of the units is to be provided via a private road within the interior of the site. No
vehicular access to the site is allowed off of Chamonix Lane.
In 2011, the Vail Town Council approved an amendment to the 2009 Chamonix Master Plan.
Most notably, following input and participation from the adjacent property owners along
Chamonix Lane, this amendment removed the prohibition against access to the site off of
Chamonix Lane provided access is to limited duplex or single-family type residences which are
one-story in height above the street, and that a new sidewalk be constructed along the length of
the site on the south side of the street. All other recommendations and expectations for the site
remained largely unchanged.
A copy of a the staff memorandum to the Vail Town Council of December 17, 2013, entitled
"Chamonix Master Plan Information Update", has been attached for reference.
VIII. Visioning Questions
People
• What is the target market for the development at the Chamonix neighborhood?
• Who do you see living in the Chamonix neighborhood?
• Where do the future owners within the Chamonix neighborhood currently reside?
• Where are the future owners primarily employed in Vail? Down valley? Both?
• What are their likely occupations?
• Are they primarily employed full time? Part time? Seasonally?
• Why is it important that these people live within the Chamonix neighborhood?
• How do these people help the Town of Vail achieve its mission of being "The Premier
International Mountain Resort Community'?
Place
• When you look at the Chamonix neighborhood what do you see?
• What is the character of the neighborhood? Of the buildings?
• What do you see happening within the Chamonix neighborhood in five years? 15 years?
25 years?
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• How is the Chamonix neighborhood integrated into the surrounding area? The
community?
• What community opportunities or issues are being addressed or solved as a result of
people living within the Chamonix neighborhood?
• What role does the Chamonix neighborhood play in addressing diversity within the
community (income, longevity, family type, product type, etc.)?
• What do you want people to say about the Chamonix neighborhood once completed?
IX. Attachments
Market Analysis: Chamonix For -Sale Employee Housing, Rees Consulting, Inc., May 2014
Chamonix Master Plan, Stan Clauson Associates, Inc., January, 2009.
Staff memorandum to the Vail Town Council, entitled "Chamonix Master Plan Information
Update", dated December 17, 2013.
Inventory of Existing Employee Housing Units in the Town of Vail, October 2015.
11
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Rees Consulting, Inc.
PO Box 3845
Crested Butte, CO 81224
970/349-9845
melanie@reesconsultinginc.com
October 27, 2015
George Ruther
Community Development Dept.
Town of Vail
75 S. Frontage Rd.
Vail, CO 81657
Re: Update to May 2014 Chamonix Market Study
Dear George:
The conclusions of the market study I prepared last year for the development of ownership housing on
the Chamonix site remain valid. It does not appear to me that an update to the study is needed at this
time. Specifically:
The estimates of potential market size, total demand and capture rates for Chamonix were
projected forward for two years; we are within the time period the study covered.
The economy is continuing the trends identified in the report with growth in jobs and declining
unemployment. The unemployment rate was 5.3% in early 2014 and had dropped to only 2.4%
as of September 2015.
The real estate market has continued its rebound with increases in home prices and diminishing
inventory of homes listed for sale.
The 70 price -capped employee ownership units in Vail are still performing well with no empty
homes and ample applicants. All re -sales continue to command maximum allowed appreciation.
Competition from down valley has not changed significantly. While a couple of large
developments that will ultimately offer employee housing are in the pipeline (Wolcott and Eagle
River Station), construction has not yet commenced.
Nothing has changed about the location and the site's marketability.
I hope this addresses your concerns.
Sincerely,
Melanie Rees
1/12/2016
Market Analysis
Chamonix For -Sale Employee Housing
Draft 4-30-14
Prepared by:
Rees Consulting, Inc.
PO Box 3845
Crested Butte, CO 81224
970-349-9845
reesconsultinginc.com
Contents
Introduction................................................................................................................................ 1
Purposeof the Study..............................................................................................................
1
Organizationof the Report......................................................................................................
1
Methodology and Sources......................................................................................................
1
AreaCovered.........................................................................................................................
2
1. Master Plan Summary.....................................................................................................
3
Number, Type and Size of Units.............................................................................................
3
Income Targeting and Prices..................................................................................................
4
Amenities...............................................................................................................................
4
SitePlan.................................................................................................................................
5
Access and Infrastructure.......................................................................................................
5
Potential Market Impediments................................................................................................
5
11. Location Analysis................................................................................................................
6
Street Address/Street Boundaries..........................................................................................
6
SurroundingLand Use............................................................................................................
6
Proximityto Services..............................................................................................................
9
Shoppingand Dining...........................................................................................................
9
PublicTransit......................................................................................................................
9
Bike and Pedestrian Access...............................................................................................
9
Parks..................................................................................................................................
9
Schools..............................................................................................................................10
Marketabilityof the Site.........................................................................................................10
III. Demographic and Economic Framework........................................................................12
Market Area Demographics...................................................................................................12
DemographicTrends.............................................................................................................14
TheEconomy........................................................................................................................16
IV. Rental Market Overview.................................................................................................19
ApartmentInventory..............................................................................................................19
OccupancyLevels.................................................................................................................20
Rents.....................................................................................................................................21
Condominium/Townhome Rentals.........................................................................................22
V. Ownership Market Conditions............................................................................................24
County -Wide Ownership Market Trends................................................................................24
PriceVariation by Area..........................................................................................................26
Availability of Market Housing................................................................................................27
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Sales of Deed Restricted Units..............................................................................................29
Availability of Deed Restricted Housing.................................................................................30
LotSales...............................................................................................................................31
Foreclosures..........................................................................................................................31
VI. Competitive Analysis......................................................................................................32
Vail Deed Restricted Inventory..............................................................................................32
Amenities/Design Features....................................................................................................37
VII. Demand Estimates.........................................................................................................39
MarketSegmentation............................................................................................................39
MarketSize...........................................................................................................................42
DemandEstimate..................................................................................................................43
Lottery/Buyer Applicants........................................................................................................44
VIII. Mortgage Availability......................................................................................................45
LoanProducts.......................................................................................................................45
Deed Restriction Limitations..................................................................................................45
Lending on Condominiums....................................................................................................46
LeasedLand..........................................................................................................................46
ARM's....................................................................................................................................46
The Impacts of Interest Rates on Affordability.......................................................................47
Down Payment Assistance....................................................................................................47
BorrowerProfile.....................................................................................................................47
IX. Conclusions and Recommendations..............................................................................48
Competition...........................................................................................................................49
FamilyOrientation.................................................................................................................50
Income Targets and Pricing...................................................................................................50
Unit Size, Type and Bedroom Mix.........................................................................................51
MortgageAvailability.............................................................................................................52
Marketing..............................................................................................................................53
Amenities/Design Features....................................................................................................53
Phasing.................................................................................................................................53
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Introduction
Purpose of the Study
The Town of Vail contracted with Rees Consulting, Inc. to analyze the market for Chamonix, a proposed
employee housing development. As envisioned, Chamonix will provide 58 units of deed restricted
ownership housing, ranging from two-bedroom flats to three-bedroom duplexes serving households
with incomes from 60% of the Area Median Income (AMI) to 120% or possibly 140% AMI.
The 3.6 -acre Chamonix site just north of the west Vail 1-70 interchange was acquired by the Town in
2005. The original master plan for Chamonix was first adopted that same year. The current master
plan, adopted in 2009, examined three development scenarios and involved citizen input and
stakeholder focus groups. A guiding policy of the master plan calls for a family-oriented neighborhood.
Two previous studies have been done analyzing the market, similar developments in other communities
and financial feasibility/gap.
Organization of the Report
This report has nine main sections as follows:
I. Master Plan Summary
II. Location Analysis
III. Demographic and Economic Framework
IV. Rental Market Overview
V.
Ownership Market Conditions
VI.
Competitive Analysis
VII.
Demand Estimates
VIII.
Mortgage Availability
IX.
Conclusions and Recommendations
The appendix contains supplemental tables with data supporting statements made herein.
Methodology and Sources
This study incorporates information from numerous sources including:
Interviews of staff managing deed restricted units in Vail, Avon and Eagle County's down valley
communities, the school district, the Eagle River Water and Sanitation District, four realtors, an
apartment manager and three mortgage lenders;
Eagle County Assessor records;
The Vail Board of Realtors MLS;
A rent and vacancy survey conducted by Polar Star Properties;
For -rent notices on craigslist.org and in the Vail Daily:
Current data on jobs, employment and the unemployment rate;
The 2000 and 2010 Census;
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Population and employment projections from the Demography Section of the Colorado
Department of Local Affairs; and
Findings from the 2007 Eagle County Housing Needs Assessment survey.
Area Covered
While Vail is the focus of this study, information is also provided on other areas within Eagle County as
needed to analyze housing market supply and demand. Eagle County's economy and population are
very inter -connected with 1-70, public transit, and well established commuting patterns. Depending
upon topic and information availability, the areas covered in this report include:
Vail, which includes only the area within municipal boundaries when referencing Census data
but extends to the zip code boundary for jobs and the developed zone for MLS data.
The Up Valley Area, which includes the towns of Vail and Avon and the unincorporated
community of Eagle -Vail, but does not include Beaver Creek, Arrowhead or other development
to the west.
Eagle County, which is all encompassing with Vail and the Up Valley area included. Occasionally
information is also provided by town within the county, such as when historical data is provided
on the sale of deed restricted homes.
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1. Master Plan Summary
A Master Plan was finalized in early 2009 for a 3.6 -acre parcel owned by the Town of Vail known as the
Chamonix site. According to this plan, 100% of the housing to be developed on the site should be deed
restricted, for -sale employee housing. The vision for the site going into the master planning process
called for a mix of units serving families with incomes between 60% and 120% of the Area Median
Income (AMI), possibly ranging as high as 140% AMI.
After considering three development scenarios, the Neighborhood Block scheme was selected which
provides for a mix of residential units with a density in the middle of the range considered and open
space. It also included a new fire station on adjacent land known as the Wendy's site. This station has
since been constructed.
Number, Type and Size of Units
The Neighborhood Block scheme contains 58 units, ranging from almost 1,300 square feet in size to over
1,600 square feet.
Proposed Units by Size
Unit Type # of Units Square Feet
2 BR Flats 20 1,292
2 BR Lofts 16 1,333
3 BR Lofts or TH's 8 1,460
3 BR Duplexes 14 1,632
No one -bedroom units are planned. This unit mix provides 81,696 sq. ft. of housing with a density of 16
dwelling units per acre. A main access street, which gained access to the site from Chamonix Road,
bisects the site with the 14 three-bedroom duplexes on the north side and the 44 multi -family units on
the south side. An alley offers secondary access to the multi -family units.
The duplexes will be situated with southern exposure. The multi -family units will have varying north,
south, east and west exposure, providing options based on views, sun exposure, highway noise and
other preferences.
Units on the north side of the buildings will view residential uses up the hill and the hillside, but
will be more protected from 1-70 noise than other units;
Units facing south will have greater sun exposure in the winter and provide views of the
mountains, but will be most prone to highway noise; and
Units facing west and east will have limited mountain views and varying degrees of sun
exposure during the day, and moderate exposure to noise from the Interstate.
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Income Targeting and Prices
Prices for the proposed homes have not yet been determined pending the outcome of this market study
and a subsequent analysis of the development's financial feasibility. Based on 2014 AMI's the proposed
units should serve households with annual incomes from approximately $40,000 to $120,000.
2014 Area Median Income - Eagle County
AMI
1 Person
2 Persons
3 Persons
4 Persons
140%
$85,260
$97,440
$109,620
$121,660
120%
$73,080
$83,520
$93,960
$104,280
100%
$60,900
$69,600
$78,300
$86,900
80%
$44,750
$51,150
$57,550
$63,900
60%
$36,540
$41,760
$46,980
$52,140
Source: Colorado
Housing
and Finance Authority
For the proposed homes to be affordable for all households with these income categories, prices would
need to range from about $135,000 to $450,000.
Source: Rees Consulting calculation
To calculate affordable prices for these targeted households, the following assumptions were used:
The monthly payment equals 30% of gross household income;
20% of the monthly mortgage payment covers taxes, insurance and HOA fees;
Down payments average 5% of the purchase price; and
The interest rate is 5.5% for 30 -years. As rates rise, a prediction economists seem to agree upon,
the amount that households in the targeted income range can afford will decrease.
Amenities
As planned, Chamonix will offer the following amenities and design features:
Garages, probably for two cars, with the duplexes;
Parking for multi -family homes on site, probably in common garages under the buildings;
Semi -private stepped courtyards between the duplexes;
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Maximum Affordable Prices
AMI
1 Person
2 Persons
3 Persons
4 Persons
140%
$316,100
$361,300
$406,500
$451,100
120%
$271,000
$309,700
$348,400
$386,700
100%
$225,800
$258,100
$290,300
$322,200
80%
$165,900
$189,700
$213,400
$236,900
60%
$135,500
$154,800
$174,200
$193,300
Source: Rees Consulting calculation
To calculate affordable prices for these targeted households, the following assumptions were used:
The monthly payment equals 30% of gross household income;
20% of the monthly mortgage payment covers taxes, insurance and HOA fees;
Down payments average 5% of the purchase price; and
The interest rate is 5.5% for 30 -years. As rates rise, a prediction economists seem to agree upon,
the amount that households in the targeted income range can afford will decrease.
Amenities
As planned, Chamonix will offer the following amenities and design features:
Garages, probably for two cars, with the duplexes;
Parking for multi -family homes on site, probably in common garages under the buildings;
Semi -private stepped courtyards between the duplexes;
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Common area between the two rows of multi -family units large enough for a play area, grill and
tables, flower/vegetable beds, etc.
Open space at the east end of the parcel which could potentially be used for a dog park;
Open space at the steeply sloping west end that might provide for viewing for fire station
activities separated by a series of low landscaped walls; and
Extensive landscaping, including aspen groves and native vegetation along the southern edge of
the parcel to buffer homes from neighboring commercial uses.
Site Plan
The parcel is about 3.6 -acres. Zoning is Housing (H); the proposed use is allowed. The parcel is vacant,
with native grasses, a few bushes and, on the southwest side of the parcel, scattered trees. The parcel
has a moderate downhill slope from north to south, with a steep slope in the northwest corner of the
parcel, which is not planned for development. Views of the mountains occur across 1-70 to the south,
southwest and southeast of the parcel. Chamonix Lane borders the property to the north. Chamonix
Road runs along the east and southeast side of the property and the West Vail Fire Station borders the
property on the southwest.
Access and Infrastructure
Access to the site will from Chamonix Lane (to the north) and Chamonix Road (to the east). The access
off of Chamonix Road will loop through the West Vail Fire Station to the North Frontage Road, allowing
for dual points of access and reducing internal traffic congestion.
Power, water and sewer lines are in place on Chamonix Lane. Utilities connections will be provided
concurrent with construction; significant utilities/infrastructure improvements are not needed prior to
developing the site.
Potential Market Impediments
Although decisions have not been finalized on many aspects of the Chamonix development, this study
examines the marketability of the proposed project taking into consideration:
Deed restrictions that allow only employees earning at least 75% of their income in Eagle County
to purchase units and limit resale prices to no more than 3% per year; income limits would not
be imposed;
Developing the 44 multi -family units and possibly the duplex units as condominiums; and
An underlying long-term land lease held by the Town of Vail.
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II. Location Analysis
Street Address/Street Boundaries
The project is located in west Vail just north of North Frontage Road. It is in a highly visible location on
the north side of 1-70, a major east -west interstate highway through Colorado, just off of exit 173.
Project Location Map
Surrounding Land Use
Highway commercial and strip mall commercial development characterizes the uses off of the North
Frontage Road and Chamonix Road, with residential neighborhoods characterizing the use patterns off
of Chamonix Lane.
To the south and east of the parcel, off of Chamonix Road, includes two gas stations, a bank and
associated commercial uses, a Holiday Inn hotel, cafe and local market and a brew pub.
Bordering the southwest corner of the parcel is the West Vail Fire Station, with access off of the
North Frontage Road.
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Primarily single family and duplex units are accessed off of Chamonix Lane to the north of the
parcel.
Vicinity Map
r
no
A residential area is located to the north of the parcel accessed via Chamonix Lane. The units are
primarily single family homes and duplexes although there are some interspersed townhomes and
condominiums. The units were mostly built in the late 1960's and the '70's. Most are modest by Vail
standards, and there are few signs of redevelopment/remodeling. Homes appear to be occupied by a
mix of residents and second -home owners. The duplexes planned as part of the Chamonix development
were placed along Chamonix Lane to ensure the greatest compatibility with adjacent neighbors in terms
of unit type, size and style.
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The Chamonix parcel, looking to the east
from the northwest corner. Chamonix Road
borders the east side of the parcel and the
truck on the south side is in the West Vail
Fire Station parking lot. Some residential
uses can be seen on the north side of the
parcel, off of Chamonix Lane.
Standing on Chamonix Lane to the north,
looking east. This shows mountain views
and the Holiday Inn hotel.
Standing on Chamonix Lane to the
north, looking southeast. This shows
the mountain views, back of the bank
(grey building) and back of the
cafe/market (green -blue roof).
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Standing on Chamonix Lane to the
north, looking south. This shows the
mountain views, 1-70 bridge, and two
gas stations adjacent to the parcel on
the south.
Proximity to Services
Safeway is within 3 -tenths of a mile of the site on North Frontage Road — about a six -minute walk along
the relatively flat bike and pedestrian trail. This is also reachable via personal vehicle or bus.
Other neighboring amenities include gas stations, bank, hotel, bar/restaurant, local market and, near
the Safeway, a barber, UPS store, dental office, child care center, liquor store, coffee shop, Sports
Authority, and 7 -Eleven. Restaurants include a pizza place, sub shop, cafe, sushi restaurant and quick
serve options, including Subway, McDonalds and Qdoba.
Public Transit
The site is located within %-mile of several bus stops on both the West Vail Red and Green Loop transit
lines, including stops off of the North Frontage Road, Chamonix Lane and the South Frontage Road.
These lines provide service every 40 -minutes in the summer (May 27 through mid-December), once per
hour in the spring (April 15 through May 26) and in 30 -minute intervals during peak hours in the winter
(December 10 through April 14). Buses run between 6 a.m. and 12 a.m. each day, with service offered
until about 2 a.m. in the winter. Routes traverse the length of the North and South Frontage Roads,
from West Vail to Vail Village.
Bike and Pedestrian Access
A bike and pedestrian path runs along North Frontage Road to the south of the parcel. This access also
travels under 1-70 to access the South Frontage Road and associated amenities.
Parks
The Chamonix Master Plan calls for some community gathering spots and semi -private courtyards
between the duplex units. Larger open areas are provided on the east and west ends of the
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development. The open space on the east end could be utilized for such uses as a dog park. Otherwise,
Town of Vail parks, numerous mountain trails and open spaces are accessed from the property via the
bike and pedestrian trails, bus service, and personal vehicles.
Schools
Children living at Chamonix would attend the following Eagle County public schools:
Red Sandstone Elementary is located at 551 North Frontage Road, 2.3 miles east of the
Chamonix site (about a 5 minute drive).
Homestake Peak School, located at 750 Eagle Road in Eagle -Vail, 5.2 miles west of the site, is
where middle school children would attend. It offers kindergarten through eighth grade.
Battle Mountain High School, located at 0151 Miller Ranch Road in Edwards, is 11 miles, or
about 15 minutes if roads are dry, west of the Chamonix site.
School bus service is available with the closest stop a short distance from the site at Chamonix and
North Frontage Road. Two different routes serve this stop. The route serving Red Sandstone
Elementary, which continues on to Battle Mountain, has 9 students assigned for this stop. Morning pick
up is at 7:33. Afternoon drop off is 4:25. For Homestake Peak, pick up is at 7:47 AM and drop off is also
at 4:25 PM. Three students from this stop are now assigned to this route. Most of the District's bus
routes are running full; a significant increase in students at the Chamonix site would need to be
discussed with the District to make sure adequate capacity exists to serve them.
Marketability of the Site
The site is marketable in many aspects though has attributes that may not appeal to some, especially
families with children and others seeking quiet, safe surroundings.
It is located between a residential and commercial area, with easy access to groceries and other
necessary goods and services. With a bike/pedestrian path running near the property and nearby bus
stops serviced by two public transit routes, it is very convenient. Proximity to a transit stop is a big plus
— a car is not required to reach most job sites, shopping, skiing and Vail's other amenities.
Views of the mountains to the south, southwest and southeast are desirable, as well as the southern sun
exposure for units facing that direction. Noise from 1-70 and Frontage Road bus/truck traffic presents
some concerns. The proximity of the West Vail Fire Station also adds some noise concerns, but
conversely provides quick emergency response times.
Trees will be planted along the south border, helping to mitigate the sight and sounds of traffic.
Nonetheless, the use of advanced soundproofing in units to protect against such noise should help the
marketability of units. Trees will also be planted around the open spaces surrounding the duplex units
and a few scattered throughout the development.
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The site is highly visible; it can be seen from 1-70 and both frontage roads and is conveniently located
just off of Exit 173. It will not be difficult to provide directions to potential residents when they make
inquiries.
Impediments to marketability of the site include:
The proximity to 1-70 and its noise. While there are few other options within Vail, many down
valley housing options would be quieter.
Proximity to adjacent commercial uses. While convenient, these commercial uses generate
traffic and bring in persons who are not residents of the community.
Limited public open space in the area. It is a densely developed area with much of the land
consumed by buildings and parking lots, private residential lots and steep hillsides. There are no
nearby parks within walking distance.
Distance to public schools. All children living in the area would have to bus to school, other than
elementary school students who are old enough to bike to Red Sandstone. This is a distinct
disadvantage compared to deed restricted housing options located in Edwards and further
down valley.
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III. Demographic and Economic Framework
This section of the market study consists of three parts:
Market Area Demographics, which provides information on population, housing units,
households and household composition and size of renter households.
Demographic Trends, which presents information from the 2000 and 2010 Censuses to identify
trends and gain insights as to how current demographic characteristics will likely be changing in
the future.
Economic Conditions, which covers jobs, wages and the distribution of jobs in Eagle County.
Since most buyers of deed restricted homes are first time buyers, the focus is on the demographics of
renter households.
Market Area Demographics
As of 2010, Eagle County had a population of around 52,000 persons residing in 19,236
households/housing units. Of these, 2,604 households or 13.5% of the total were within the town of
Vail. About one-third of the county's households resided in the larger up valley area.
2010 Population and Housing Occupancy
Eagle County is projected to have a relatively strong rate of growth during upcoming years, averaging 2%
per year through 2015 then 2.9% per year through 2020. The State Demography Section projects that
the county will have a population of 66,382 in 2020, a gain of over 14,000 residents, or about 700
persons per year. These growth estimates may be somewhat overstated; however. State Demography
estimates for 2012 indicate the Eagle County has declined slightly since the Census, from 52,197 to
51,944.
While most residential units in Eagle County were occupied as primary residences in 2010
(approximately 61%), only 36% of units in Vail were occupied by residents; second homes/vacation
accommodations comprised the majority. In the up valley area, the housing occupancy rate was only
48% in 2010. The homes that are not occupied by members of the workforce typically create demand
for workforce housing through cleaning, repair, snow removal, landscaping and similar jobs involved in
the operation and maintenance of the units.
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Vail
Up Valley
Eagle
County
Population
5,305
15,257
52,197
Housing units
7,230
13,064
31,312
Households
2,604
6,294
19,236
Housing occupancy rate
36.0%
48.2%
61.4%
Source: 2010 US Census
Eagle County is projected to have a relatively strong rate of growth during upcoming years, averaging 2%
per year through 2015 then 2.9% per year through 2020. The State Demography Section projects that
the county will have a population of 66,382 in 2020, a gain of over 14,000 residents, or about 700
persons per year. These growth estimates may be somewhat overstated; however. State Demography
estimates for 2012 indicate the Eagle County has declined slightly since the Census, from 52,197 to
51,944.
While most residential units in Eagle County were occupied as primary residences in 2010
(approximately 61%), only 36% of units in Vail were occupied by residents; second homes/vacation
accommodations comprised the majority. In the up valley area, the housing occupancy rate was only
48% in 2010. The homes that are not occupied by members of the workforce typically create demand
for workforce housing through cleaning, repair, snow removal, landscaping and similar jobs involved in
the operation and maintenance of the units.
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Proportionately more renters live up valley while more owners live down valley. While up valley is home
to about one-third of Eagle County's total households, nearly 45% of total renter households reside
there. Relatively fewer households can afford to buy homes in the Vail area; the option other than
commuting to buy down valley is to rent up valley.
Over one-half of the households in Vail and nearly 50% of those in the up valley area rent. Demographic
characteristics vary by area. There are clear differences between up -valley and down -valley
communities. Vail has proportionately more renters than owners, more singles and roommate
households than families, and smaller renter households than down valley.
Of the 3,336 renter households living up valley in 2010:
Roommate households were the most common (37%).
Nearly 30% had only one member living alone.
Families were in the minority. About 19% were families with children and 15% were families
(both couples and singles) without children.
2010 Renter Households by Type: Up Valley Area
Family, no
children
Roommates 479 total
37 /o ( )
(1,152 total)
29%
(899 total)
Source: 2010 US Census
Family, with
children
19%
(800 total)
In Vail, proportionately fewer renter households have children (only 8%) and more consist of singles
living alone (36%) or with roommates (45%).
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The average size of renter households within the up valley area is about 2.45 persons per unit. In Vail is
it considerably smaller at 2.04 persons per renter occupied unit. The largest segment of the renter
market is comprised of one- and two -person households, which combined total 61%.
2010 Renter Households by Size: Up Valley Area
5+ person
4 -person 9%
12% (264 total) 1 -person
(2
3 -person
18%
(571 total)
Demographic Trends
Source: 2010 US Census
29%
9 total)
son
YO
(1,014 total)
Between 2000 and 2010, most of the population growth in Eagle County occurred down valley. While
growth in Vail was slower, the rate of growth was particularly low elsewhere within the up valley area.
The population increased by 25% in the county but only 17% in Vail and just under 6% in the up valley
area. Growth in households followed a similar pattern.
Total housing units, however, increased at about the same rate in the county and the up valley area
(41%) and at a slower pace in Vail (34%), where land availability is very limited. The number of housing
units grew faster than the resident population and households due to construction of second/seasonal
homes.
Change in Population, Housing Units and Households: 2000 - 2010
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Vail
Up Valley
Eagle County
Population
2000
4,531
15,326
41,659
2010
5,305
16,234
52,197
• change
17.1%
5.9%
25.3%
Total Housing Units
2000
5,389
11,527
22,111
2010
7,230
16,286
31,312
• change
34.2%
41.3%
41.6%
Source: 2000 and 2010 US Census
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The housing occupancy rate declined by about 7 percentage points in the county, 4 points in Vail and 9
points in the up valley area, indicating a significant rise in second homes. Even though growth in the
number of households did not keep pace with growth in second/seasonal homes, the number of units
occupied by local residents increased. The up valley area gained 680 households (owners and renters
combined) between 2000 and 2010, for an average increase of 68 households per year.
The increase in households within the up valley area was due primarily to growth in the number of
renter households (a gain of 419 renter households between 2000 and 2010, or an average of nearly 42
households per year). Renters now comprise the majority of households living in Vail (51.5%). The
number of renter households in Eagle County as a whole increased by nearly 1,400 households, or an
average gain of 140 households each year.
There were some significant changes in the composition of renter households, which varied by area:
Roommate households declined as a percentage of households in all areas, from 34% to 27% in
Eagle County, from 44% to 38% within the up valley area and from 49% to 45% in Vail.
Renters living alone increased, especially in Vail, from 33% to 36%.
The percentage of family households, with and without children, stayed about the same in Vail
but increased in the county as a whole; growth in families largely occurred down valley.
2000
2010
Change in Composition of Renter Households: 2000 — 2010
Family, no children
Family, with children
Living alone
Non -family, roommates
Family, no children
Family, with children
Living alone
Non -family, roommates
Source: 2000 and 2010 US Census
Vail
Up Valley
Eagle County
1,032
2,917
5,499
12%
11%
17%
7%
19%
25%
33%
25%
25%
49%
44%
34%
100%
100%
100%
1,340
3,336
6,893
11%
15%
18%
8%
18%
29%
36%
29%
26%
45%
38%
27%
100%
100%
100%
Changes in renter household size also varied by region:
Renter households decreased in size in both the town of Vail and the up valley area while size
increased slightly in the county.
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Renter households in all areas predominately have one or two -persons (56% to 73%), followed
by 3 -person households (16% to 18%).
A much larger percentage of households have three or more members in both the county (26%)
and the up valley area (22%) than in Vail (10%).
The population and labor force in the Vail area is aging, as is the trend in other Colorado mountain
resort communities. The age of renter households increased between 2000 and 2010.
The largest increase occurred in households 35 to 44 years of age.
The percentage of households under 35 declined in all areas; although these younger
households comprise a larger percentage of households in Vail and the up valley area than in
the county as a whole.
Only households with a householder under 25 years of age decreased in number as well as
percentage in all areas (-21 in Vail, -150 in Eagle County and -153 in the up valley area).
The Economy
The economy in Eagle County is slowly recovering. Eagle County currently had about 37,820 jobs on
average in 2013. This is down from the peak of about 40,500 jobs in 2008, but up from a low of 35,660
in 2010. The loss of 2,680 jobs reported by the Colorado Department of Local Affairs is much lower than
a local estimate of nearly 6,000 jobs, a difference likely attributed in part to construction jobs, which are
hard to track. Since 2010, total employment has increased by approximately 2,160 jobs, which equates
to an average rate of growth of about 2% per year.
Change in Jobs: Eagle County, 2005 — 2013
44,000
42,000 40,499
40,163
40,000 -
38,319 37,821
38,000 - 7,2300 047
36,529 36,030
0 35,662
36,000
0
0
34,000
32,000
30,000
2005 2006 2007 2008 2009 2010 2011 2012 2013
Source: Colorado Department of Local Affairs (DOLA), State Demography Section
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The unemployment rate in Eagle County has been declining. Unemployment reached a high of 9.6% in
2010 and declined to an average annual rate of 6.6% in 2013, slightly lower than the state average of
6.8%. This is still much higher than pre -recession rates, which varied between 2.9% and 3.9% from 2005
and 2008, although during the 2013/14 ski season the rate hovered just above 5%.
Average Yearly Labor Force and Employment: Eagle County 2005 - 2013
Year
Labor Force
Employment
Unemployment
Unemployment Rate
2013
29,391
27,454
1,937
6.6%
2012
29,793
27,388
2,405
8.1%
2011
29,293
26,689
2,604
8.9%
2010
29,674
26,836
2,838
9.6%
2009
30,624
28,235
2,389
7.8%
2008
31,837
30,705
1,132
3.6%
2007
31,161
30,267
894
2.9%
2006
30,206
29,191
1,015
3.4%
2005
28,670
27,555
1,115
3.9%
Source: Colorado
Department
of Labor and Employment
It appears that the decline in the unemployment rate has been due in part to the continued out
mitigation of the labor force. The total number of Eagle County's residents who were employed in the
2013/14 ski season was slightly lower than in the 2012/13 season.
35000
30000
d
,i 25000
0
20000
m
0
0
15000
UJ
1111
5000
Employment and Unemployment by Month:
Eagle County July 2012 — June 2013
Employment (Unemployment Rate (%)
9.7%
.1%
8.0°/ ° 8.4%
0
1.1 o rjo0 7.3%
6% no/ -.6 .4 ° .3% 6.6%
0
0/65.1%05.3
'4 %
12%
10%
8%
6% >,
0
n
E
d
4% 0
2%
0 0%
C
Source: Colorado Department of Labor and Employment
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Unemployment rates in Eagle County vary by season. Unemployment is lowest during the winter
months (December through March) and highest during the shoulder seasons, in May and November.
For those who qualify, filing for unemployment is a common way to make it through the shoulder
seasons.
Eagle County jobs paid an average annual wage of about $39,187 in 2012. About 40% of jobs in Eagle
County are in the lowest wage sectors of accommodations and food, arts and retail trade, averaging
between about $28,700 and $34,000 per year.
Vail is no longer the economic center of Eagle County in terms of jobs. Based on the Quarterly Census of
Employment and Wages (does not include sole proprietors and employees exempt from unemployment
insurance), approximately 26% of the county's employees work in the Vail zip code area. Just over 15%
of establishments (businesses, government, non profits, etc.) are located in Vail, an indication that
employers tend to be larger in Vail than elsewhere in the county. Wages in Vail are slightly higher than
in Eagle County as a whole.
Employees and Employers by Area
Average Jobs
Eagle County
Vail
Percent Vail
2012
28,179
7,401
26.3%
2013: 1st -3rd Qtr.
28,910
7,569
26.2%
# of Establishments
2012
3,191
493
15.4%
2013: 1st -3rd Qtr.
3,199
483
15.1%
Source: Colorado Department of Labor and Employment, Quarterly Census of
Employment and Wages
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IV. Rental Market Overview
To assess the extent to which limited rental availability and rising rents could impact the demand for
ownership housing, rental market conditions in the Vail area are summarized, including number of units,
vacancy rates, apartment and condominium rents, and trends in rental rates.
Apartment Inventory
This analysis focuses on two major apartment complexes in Vail, two in the Dowd Junction area and
three in Avon. Combined, these properties have a total of 1,046 units. These units house approximately
30% of the renter households residing in the area. All but one of these properties, River Run, has some
type of occupancy and/or income restriction.
General Description of Competing Properties
The only apartment projects within Vail through Avon that were not examined as part of this analysis
are:
Riverview Apartments, a 72 -unit rent subsidized Section 8 complex in Eagle -Vail serving very low
income households;
Three seasonal employee projects owned by Vail Resorts: First Chair, Vail, a 124 -bed project
completed in 2011; River Edge, Avon, a 103 -unit project built in 1997; and The Tarnes, Avon, a
136 -unit project built in 2000;
18 rental units located at Vail Commons above retail space; and
36 units in two projects (Buzzard Park and Creekside) owned by the Town of Vail and rented to
Town employees.
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Buffalo
Buffalo
EagleBend
Kayak
Middle
River Run
Timber
Ridge
Ridge II
Crossing
Creek
Ridge
Management
Polar Star
Corum
Polar Star
Polar Star
Coughlin &
Texas Capital
Corum
Properties
Properties
Properties
Company
Partners LLC
Location
Avon
Avon
Avon
Dowd
Vail
Dowd Junction
Vail
Junction
# of floors
4
4
3
3
3-8
3-4
3
Unit Type
flats
flats
flats
flats
flats
Flats/lofts/TH
flats
Year Built
2003
2003
1990
2000
2003-04
1985
1981
General
excellent
excellent
good
good
excellent
good
poor
Total Units
68
176
294
50
142
117
199
Restrictions
Local
LIHTC/Mkt
Local
Local
LIHTC/Mkt
Mkt
Local
50% AM I
40
6
60% AMI
92
91
80% AMI
68
120% AMI
294
50
None
44
45
117
199
The only apartment projects within Vail through Avon that were not examined as part of this analysis
are:
Riverview Apartments, a 72 -unit rent subsidized Section 8 complex in Eagle -Vail serving very low
income households;
Three seasonal employee projects owned by Vail Resorts: First Chair, Vail, a 124 -bed project
completed in 2011; River Edge, Avon, a 103 -unit project built in 1997; and The Tarnes, Avon, a
136 -unit project built in 2000;
18 rental units located at Vail Commons above retail space; and
36 units in two projects (Buzzard Park and Creekside) owned by the Town of Vail and rented to
Town employees.
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Rental occupancy levels were very high in March. The overall rate among the county's major non-
seasonal apartment complexes was over 97%. Timber Ridge, water damage and long term wear/tear
limited the ability to rent some units, had the highest vacancy rate and skewed the overall average.
Excluding Timber Ridge, the overall average occupancy rate was nearly 99%.
Apartment vacancy rates remained low through 2009, shot upward in 2010, started to decline in 2011
and dropped to their lowest point in three years by the first quarter of 2013. More specifically:
Vacancy rates remained low through 2009, long after the recession caused rental markets to
soften throughout much of the country. This was due to the strong influence that construction
has on jobs and the economy in the Vail Valley; construction projects initiated before the
recession were not completed until 2009.
In 2010, vacancies shot upward from a combination of job losses and Vail Resorts terminating
their master leases on many units. Their need to import seasonal employees dropped when
high unemployment freed up many local workers to fill seasonal ski resort positions. Vail
Resorts had extremely high vacancies in the seasonal worker properties they owned, as was the
case at other Colorado ski resorts.
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Vacancy rates vary by season. Rates are consistently lower in the first quarter of each year and tend to
be lowest in the third quarter. April and May generally have the highest turnover.
The following table shows that properties in Avon and Edwards have similar occupancy levels as those
within Vail. This means that, as occupancy levels continue to rise in general with the economy's
recovery, moving down valley will not be a viable alternative to the decreasing availability and rising
rents in the Vail area.
Occupancy Levels by Property, March 2013
Rents
The rents shown on the following table are market rates or rents for units with income restrictions in
the same range at 80% to 120% AMI which, according to property managers, are set based on market
conditions rather than income caps. In other words, the maximum allowed rents for 80% and 120% are
not charged; rents reflect the market. The rents for Low Income Housing Tax Credit (LIHTC) units with
restrictions at 50% and 60% AMI have been excluded from this analysis.
Rents by Unit Type and Property
Location
# Units
Occupancy
Kayak
Middle
River
Rate
Buffalo Ridge
Avon
68
100%
Buffalo Ridge II
Avon
176
100%
EagleBend
Avon
294
99%
Eagle Villas
Eagle
120
93%
Kayak Crossing
Avon
50
98%
Lake Creek
Edwards
270
99%
Middle Creek
Vail
142
100%
Timber Ridge
Vail
198
87%
River Run
Avon
117
100%
Total/Average
1 BR
1435
97.3%
Source: Polar Star Properties Market Summary,
3/17/14
Rents
The rents shown on the following table are market rates or rents for units with income restrictions in
the same range at 80% to 120% AMI which, according to property managers, are set based on market
conditions rather than income caps. In other words, the maximum allowed rents for 80% and 120% are
not charged; rents reflect the market. The rents for Low Income Housing Tax Credit (LIHTC) units with
restrictions at 50% and 60% AMI have been excluded from this analysis.
Rents by Unit Type and Property
1/12/2016
Buffalo
Buffalo Ridge II
Eagle
Kayak
Middle
River
Timber
Average
Ridge
Bend
Crossing
Creek
Run
Ridge
Income
80%
50% -Mkt
120%AMI
120%
60% -Mkt
Mkt
None
Restriction
AMI
AMI
Studios
$735 mkt
$735
1 BR
$930
$925 mkt
$804
$1,703
$1,091
2 BR/1 BA
$1,220
$1095 mkt
$1,045
$1,140
$1,075
$1,115
2 BR/2 BA
$1,910
$1,910
3 BR
$1,455
$1,324
$1,450
$1,985
$2,210
$1,685
4+ BR
$1,650
$1,650
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Historically rents have generally been higher in Vail than down valley. Current rents among these
properties, however, only partially reflect this. For example, rents for three-bedroom units at Middle
Creek in Vail average about $575 higher than at Buffalo Ridge, EagleBend and Kayak Crossing further
down valley.
Alternatively, River Run, a condominium project in the Dowd Junction area that functions as an
apartment property (all units owned and managed by one company) without any type of occupancy or
income restriction, recently raised rents by around $540 per month, exceeding rents in Vail. The extent
to which these rent increases may negatively impact occupancy levels or marketability can be evaluated
by mid -summer when units vacated in April/May should be leased.
Condominium/Townhome Rentals
During the last week in April, a total of 61 units were listed for rent in the Up Valley area (Vail through
Avon), 40 on craigslist and 24 in the Vail Daily, with only three duplicates. Of these, most were
condominiums although a few were listed as apartments, townhomes, duplexes and lock offs. Rents for
these units ranged from $700 for a studio to $3,200 for a three bedroom duplex. The overall average
rent for these units was $1,918.
Condominium and Townhomes For -Rent Listings
Unit Type Average Rent
1 Bdrm $1,285
2 Bdrm $1,859
3 Bdrm $2,550
Trends in Rents
Rents are rising after several post -recession years when rates dropped and discounts were widespread.
The overall average rent for apartments increased 3% between July 2012 and 2013, and the per -square -
foot average grew by 15%, indicating relatively higher increases for smaller units.
Change in Average Apartment Rents
July 2012 — July 2013
July July March
2012 2013 2014
Avg. Rent/Unit $1,159 $1,162 $1,264
Avg, Rent/SF $1.17 $1.35 $1.46
Source: Polar Star Properties
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Rates for units listed for rent in the Vail Daily and on craigslist.org were higher in April 2014 than in
July/August 2013.
Condo/Townhome Rent Increases
Unit Type Average Rent
Average Rent
Percent Change
July/Aug 2013
April 2014
1 Bdrm $1,104
$1,285
16.4%
2 Bdrm $1,762
$1,859
5.5%
3 Bdrm $2,106
$2,550
21.1%
Source: Vail Daily and craigslist
The decreased availability of rental units combined with rising rents will cause some renters who want
to live in Vail to consider buying, especially households that have been residing in the area for some
time. Employees moving into the area will be more likely than longer term residents to live with
multiple roommates, allowing them to share the cost of higher rents with others and crowd into and
occupy available units.
Market rents have increased to levels where mortgage payments could be competitive, depending upon
how units at Chamonix are priced. To be affordable for households with incomes ranging from 60% AMI
to 140% AMI, monthly payments would need to range from about $900 to $3,000, with resulting in an
overall average below $2,000 per month. Rents now average about $1,860 for two-bedroom
condos/town homes and $2,550 for three bedrooms.
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V. Ownership Market Conditions
This section provides an overview of the ownership market in Eagle County for both market rate and
deed restricted housing. This section evaluates current conditions and past trends including the number
of sales, sales prices, and inventory of units listed for sale. Variations in market conditions by location
within the valley is also analyzed to determine how values vary and if down valley housing is competitive
given commuting costs.
The focus is on deed restricted homes and market units priced less than $500,000 given that units at this
price point would be most competitive with homes at Chamonix. Because Chamonix is proposed to
target households with incomes in the 60% to 140% AMI range, this equates to a price range of
$135,000 to $450,000, or a midpoint around $300,000.
County -Wide Ownership Market Trends
The ownership market in Eagle County has improved since 2009, although the recovery has not been
robust or consistent across the board. Dollar volume jumped quickly in 2010 due to high-end sales then
declined due to sales of bank owned properties and lower -end bargains. The number of sales, however,
has steadily increased since 2009. In 2013, the overall dollar volume decreased slightly from 2012 yet
the number of sales continued to increase.
Trends - Transactions and Dollar Volume
$1,600,000,000
$1,400,000,000
$1,200,000,000
$1,000,000,000
$800,000,000
$600,000,000
$400,000,000
$200,000,000
$0
Source: Land Title Guarantee
2009 2010 2011 2012 2013
Dollar Volume Number of Transactions
2000
1800
1600
1400
1200
1000
800
600
400
200
0
Just over 1,400 residential units sold in Eagle County in 2013. This figure includes the sale of 45 deed
restricted units. The inventory of bargains and bank owned homes largely disappeared as buyers
became motivated by several factors:
Evidence that prices had hit bottom and were starting to rebound;
Economic recovery; and
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Widespread predictions that mortgage interest rates will rise.
Of total sales in 2013, over half were for prices at or below $500,000.
The free market overall remains priced higher than deed restricted units in most of the county. The
average 2013 sales price of $887,330 is nearly three times the $300,000 midpoint of the price range
targeted by Chamonix.
Residential Sales by Price Range, 2013
While non -local buyers, often paying cash, were some of the first buyers to take advantage of lower,
post -recession prices, over half of the sales in Eagle County in 2013 were to local buyers. Sales to locals
drove the high number of sales in 2013 of units priced under $500,000.
All Sales by Unit Type, 2013
Origin of Buyer Number of Percent of Units
Units Sold Sold
Local 943 53%
Front Range 267 15%
Out of State - US 532 30%
International 24 1%
Total 1,766 100%
Source: Land Title Guarantee Note: 365 vacant lots and non-
residential sales included in these figures.
The number of sales were about evenly divided in 2013 between up valley (Vail through Avon) and
mid/down valley communities. Just over one-third of sales were within Vail.
Vail
Up Valley Area
Down Valley
Source: Land Title Guarantee
Sales by Area, 2013
Number of Sales Percent of Sales
598
Number of Sales
Percent of Sales
Average Price
<$500,000
724
51.7%
$306,338
$500,001 - $1,000,000
374
26.7%
$696,944
$1,000,001 - $1,500,000
108
7.7%
$1,237,384
$1,500,001- $2,000,000
74
5.3%
$1,734,328
>$2 million
121
8.6%
N/A
Total/Average
1,401
100.0%
$887,330
Source: Land Title Guarantee
While non -local buyers, often paying cash, were some of the first buyers to take advantage of lower,
post -recession prices, over half of the sales in Eagle County in 2013 were to local buyers. Sales to locals
drove the high number of sales in 2013 of units priced under $500,000.
All Sales by Unit Type, 2013
Origin of Buyer Number of Percent of Units
Units Sold Sold
Local 943 53%
Front Range 267 15%
Out of State - US 532 30%
International 24 1%
Total 1,766 100%
Source: Land Title Guarantee Note: 365 vacant lots and non-
residential sales included in these figures.
The number of sales were about evenly divided in 2013 between up valley (Vail through Avon) and
mid/down valley communities. Just over one-third of sales were within Vail.
Vail
Up Valley Area
Down Valley
Source: Land Title Guarantee
Sales by Area, 2013
Number of Sales Percent of Sales
598
34%
842
48%
924
52%
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Sales were about evenly split between single family homes and multi -family units. The similarity in
average price between the two categories is not typical in most market areas and can be attributed to
the sale of high-end, multi -family second/vacation homes.
Residential Sales by Unit Type, 2013
Number of Percent of Units Average Price
Units Sold Sold
Single Family 707 50.5% $970,764
Multi Family 694 49.5% $802,332
Total/Average 1,401 100.0% $887,330
Source: Land Title Guarantee
Price Variation by Area
Prices vary widely within Vail, due to the location, age, size and quality of units within various areas of
the town. The Chamonix parcel is within the Buffer Creek, Vail Das Shone, Vail Heights, Vail Ridge area,
where the median price in 2013 was $480,000. The average price per square foot was $475 for single
family homes and $349 for multi -family units.
County wide, variation in price is location dependent but is also influenced by age and size of units. The
median price of 2013 sales in Gypsum, Edwards and Avon was lower or equal to the mid point of
$300,000 under consideration for Chamonix.
2013 Sales by Area and Price
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Number
Median
Avg. PPSF
Avg. PPSF
of Sales
Price
SF
MF
Bighorn, East Vail
85
$471,000
$475
$405
Vail Village
67
$1,650,000
$1,485
$1,581
Lionsridge, Sandstone, The Ridge, The Valley
40
$395,000
$506
$1,041
Buffer Creek, Vail Das Shone, Vail Heights, Vail Ridge
11
$480,000
$475
$349
Intermountain, Matterhorn, Vail Village West
45
$527,000
$394
$372
Minturn, Redcliff
43
$305,000
$271
$257
Eagle -Vail
80
$427,500
$247
$226
Avon
121
$278,000
$244
$326
Edwards
87
$300,000
$229
$258
Homestead, South 40
56
$422,500
$242
$225
Eagle
229
$341,000
$173
$160
Gypsum
229
$228,500
$133
$97
Source: Land Title Guarantee Note: 365 vacant lots and non-residential
sales included in these figures.
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Availability of Market Housing
The availability of housing listed for sale in Eagle County at prices under $500,000 is very limited. A total
of 78 units as of early April were for sale at this price point in the major communities. This equates to a
1.3 -month inventory based on 724 sales in this price range in 2013. While the inventory of homes listed
for sale may increase in the summer months it was very tight as of early April.
Nearly half of the 78 units were condominiums, most of which were located in Vail. While the down
valley inventory of homes in this price range has been much larger in recent years, only 21 units were
for sale in Eagle and 16 units in Gypsum.
To buy a free market single family home for less than $500,000 generally requires living in Eagle and
Gypsum. Single family homes at this price point are no longer available in Edwards. Of the 15 units in
Edwards, 13 were condominiums and the other two were duplex units.
Market Units Listed for Sale at <$500,000, by Type and Location
Condo Townhome Duplex Single Total
Family Listings
Vail 23 2 1 26
Edwards 13 2 15
Eagle 1 7 4 9 21
Gypsum 2 13 16
36 11 7 24 78
Source: Vail Board of Realtors MLS
Note: A list of units for sale by area is in the appendix to this report.
Opportunities to buy a free market homes for less than $300,000 were very limited throughout the
county —12 in total, half of which were condominiums in Vail built in the 1960's or early '70's.
Choice improves in the $300,000 to $400,000 range where 30 units were listed for sale. For this price, a
buyer could choose among condominiums in in Vail or Edwards, small single family homes or larger
townhomes in Eagle, or two- to four-bedroom single family homes in Gypsum.
In the $400,000 to $500,000 price range, choices in Vail range from a lodge unit to a 1,500 square foot
duplex. The average age of these 14 units is 42 years, with most built in the early 1970's. Of the five
units in Edwards, four were larger, relatively newer condominiums (compared to Vail) and one
townhome. In Eagle, a total of 7 duplexes and single family homes were for sale, averaging 2,500 square
feet. In Gypsum, 10 single family homes were for sale at about the same average size as in Eagle though
the range was much larger, from 1,816 to 4,130 square feet.
The variation in price per square foot is indicative of the difference in home values in the county. At
$527 per square foot the price of homes listed for sale in Vail under $500,000 is nearly three times the
average price in Gypsum. The average price per square foot drops sharply between Vail and Edwards
(-45%) but then declines more gradually between Edwards and Eagle (-30%). The difference in the
average price per square foot between Eagle and Gypsum was only $19.
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Market Units Listed for Sale at <$500,000, by Price Range and Location
A total of 26 residential units were listed for sale in Vail in early April and priced under $500,000.
The four units for sale most comparable to the proposed Chamonix units in terms of location and
suitability for occupancy by year-round residents were listed for an average price of $458,750, averaged
1,298 square feet in size and were built between 1969 and 1972.
Comparable Market For -Sale Listing in Vail
Price
Vail
Edwards
Eagle
Gypsum
Total
$100,000 - $149,999
Chamonix Ln
2
$475,000
1
1
$150,000 - $199,999
East Vail
2
1
1500
1
$200,000 - $249,999
1
1
1
3
$250,000 - $299,999
6
1
7
$300,000 - $349,999
3
5
11
2
21
$350,000 - $399,999
2
4
1
2
9
$400,000 - $449,000
7
2
4
3
16
$450,000 - $500,000
7
3
3
7
20
Total Listings
26
15
21
16
78
Avg. Price/Sq Ft
$527
$308
$212
$193
Source: Vail Board of Realtors MLS, 4-8-2014
A total of 26 residential units were listed for sale in Vail in early April and priced under $500,000.
The four units for sale most comparable to the proposed Chamonix units in terms of location and
suitability for occupancy by year-round residents were listed for an average price of $458,750, averaged
1,298 square feet in size and were built between 1969 and 1972.
Comparable Market For -Sale Listing in Vail
Price
Project/Area
Bdrms
$432,500
Chamonix Ln
2
$432,500
Chamonix Ln
2
$475,000
Chamonix Ln
3
$495,000
East Vail
2
Source: Vail Board of Realtors MLS, 4-8-2014
Of the comparable properties:
Baths Scl Ft Price/SF Yr Built Type
2
1103
$392
1972
TH
2
1110
$390
1972
TH
2
1480
$321
1969
Condo
3
1500
$330
1967
Duplex
Two are townhomes on Chamonix Lane that are within different phases of the same property.
Each townhome is listed at $432,500. One unit had just been listed in early April. The other had
been on the market for about one month and received much interest — 6 or 7 showings within a
few weeks. Most were from professionals who had lived in Vail some time (not new to the area)
and were in their late 20's to early 40's. Some were singles and others were couples, but none
had children. The units both have homemade storage sheds and small yards, but no garages.
One is a condominium listed for sale at $475,000 on Chamonix Lane that was originally a three-
bedroom unit, but later converted into a two-bedroom unit on the upper floor with a lock -off
studio and kitchen downstairs that can be rented separately. The two units combined total
1,480 square feet. It was built in 1969. It has a storage closet off of the patio, but no garage.
The property had three offers within a couple of days of being listed — one from a Denver
resident looking to buy a second home and two from developers looking for a unit to deed
restrict in order to satisfy the Town's housing requirements.
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The other unit listed for sale that is somewhat comparable to the proposed Chamonix homes is
a duplex unit in east Vail with an EHU restriction (occupancy by an employee working 30+ hours
in Eagle County). This 1,500 square foot, two-bedroom unit built in 1967 is listed at $495,000. It
has been on the market for about one year. Interest has been moderate with 6 to 8 showings to
qualified buyers. These potential buyers have all been single or couples without children. They
have been considering homes as far down valley as Edwards, although some have also looked in
Eagle.
Sales of Deed Restricted Units
County Assessor records indicate 144 deed restricted housing units sold from 2010 through March 2014,
for an average of nearly 35 units per year or 2.8 units per month. In 2010 and 2011, the inventory of
deed restricted units listed for sale was large due to a combination of factors: employees left the valley
due to lack of work, opted to purchase free market homes when prices dropped, or delayed purchasing
due to economic uncertainty and tough mortgage lending standards. By 2013, however, the deed
restricted market had rebounded with 45 sales in a single year. In 2013, a record was set at the largest
deed restricted development in the county, Miller Ranch. By the end of the year, the inventory of units
listed for sale had been largely absorbed; none were listed for sale through Eagle County's Valley Home
Store.
The trend in deed restricted sales in Vail differed from that in the rest of the county. The number of
sales peaked in 2010 then declined to only one sale in 2013. This was due to decreased availability of
units for sale rather than demand, however. When owners of deed restricted units moved out of Vail
during the recession, units became available for others to buy. Also two new units were added in 2010,
the Arosa duplex. Availability did not last for long, however, as there were sufficient lottery applicants
to purchase all homes that became available. Buyers during this period were always able to obtain
maximum allowed resale prices, an indication that demand continued to outweigh supply.
Sales of Deed Restricted Homes, 2010 — March 2014
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2010
2011
2012
2013
2014
Total
Percent of
Jan -Mar
Total
Vail
11
5
4
1
2
23
16.0%
Avon
1
1
0.7%
Edwards
25
14
21
30
2
92
63.9%
Eagle
2
4
5
5
1
17
11.8%
Gypsum
7
7
4.9%
Basalt
1
2
1
4
2.8%
Total
39
24
30
45
6
144
100.0%
Source: County Assessor data.
Note: units with covenants only
requiring
preference be given to employees not
included.
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Unlike with the free market, prices of deed restricted housing do not vary much by community. The
homes at Miller Ranch in Edwards have generally been higher on both a per-unit and per -square -foot
basis than units in Vail. While the development includes single family homes, it also includes duplex and
condominium units. Deed restricted prices have been consistently lower in Eagle but the price
differential is not nearly as great as in the free market.
Prices of Deed Restricted Sales by Area, 2010 — 2013
Avg. Price/Unit
2010
2011
2012
2013
Eagle
$172,500
$145,000
$153,700
$202,300
Edwards
$247,904
$238,700
$237,319
$253,220
Gypsum
$157,100
Vail
$238,718
$199,060
$197,400
$164,300
Avg. Price/SF
Eagle
$189
$144
$130
$177
Edwards
$226
$197
$200
$219
Gypsum
$141
Vail
$195
$167
$200
$177
Source: County Assessor data
While sales of deed restricted homes in Vail have historically been able to command the maximum
appreciation allowed, this has not always been the case down valley. Following the recession, the
inventory grew and it was clearly a buyers' market. In 2011, deed restricted homes sold for 10% to 20%
below allowed maximum resale price. The trend is reversing, however. In 2012, resale prices were
generally 5% to 10% below the allowed maximum, and by 2013 the reduction averaged around 5%. So
far in 2014, some sellers have been able to obtain full appreciation while others have had to reduce
prices up to 7% reduction. Sellers of smaller units are better able to stay firm on price whereas larger,
more expensive homes are taking the biggest price hits. The down valley deed restricted market is
definitively switching from being a buyer's to a seller's market.
The 2010 average sale price for deed restricted homes in Vail may best represent the prices of the
town's entire deed restricted inventory since there have been few sales since then and only one in 2013.
Availability of Deed Restricted Housing
Very few deed restricted homes are available for purchase. As of late April, four units at Miller Ranch
and one at Eagle Ranch were listed for sale through the Valley Home Store. The Town of Vail had
received notification that two units (one at Red Sandstone and one at Vail Heights) were being listed for
sale. These seven units combined equal a 1.9 -month inventory based on 45 sales in 2013.
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Deed Restricted Units Listed for Sale
Unit Type
Development
Town
Bdrms Price
Condo*
Vail Heights
Vail
1
$212,544
Condo
Red Sandstone
Vail
2
$236,248
Condo
Miller Ranch
Edwards
2
$183,000
Condo
Miller Ranch
Edwards
3
$248,000
Townhome
Eagle Ranch
Eagle
3
$354,900
Single Family
Miller Ranch
Edwards
3
$390,000
Single Family
Miller Ranch
Edwards
3
$354,000
*Town of Vail employees
have priority.
Note: Table does
not include units that
may be listed
by realtors.
Lot Sales
Draft 4-3-14
In 2013, a total of 176 vacant residential parcels sold for an average of $264,750, up from 103 sales in
2012 and 100 sales in 2011.
Foreclosures
Short sales and sales of bank owned homes obtained through foreclosure should not have significant
impact on the market in the near future. The number of foreclosures has dropped off sharply. In 2011,
463 foreclosures were filed in/near the county's major towns (not including the portion of Eagle County
within the Roaring Fork valley). In 2013, the number had dropped to 178 or about 36% of the total two
years before.
Foreclosures Filed by Town, 2011 and 2013 Compared
2011 2013
Avon
103
43
Eagle
109
36
Edwards
64
34
Gypsum
152
51
Vail
35
14
Total
463
178
Source: Eagle County Public Trustee
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VI. Competitive Analysis
This section will focus on deed restricted units throughout the county. This analysis, in combination with
the pricing and availability of free market housing both in Vail and down valley are used to determine
the prices that the proposed units can command (see Conclusions and Recommendations).
This analysis first focuses on the inventory of deed restricted ownership units in Vail then provides
information on the nearly 650 other deed restricted units elsewhere in Eagle County. The marketability
of amenities and design features is then examined.
Vail Deed Restricted Inventory
A total of 137 deed restricted condominium, townhome and duplex units are located within the town of
Vail. This inventory does not include apartments. The largest project is Vail Commons, with 53 units.
All of the inventory is deed restricted for occupancy by employees who work in Eagle County 30 or more
hours per week.
Most units (about 60%) also have resale price caps that limit appreciation in order to maintain
permanent affordability. The other 40% are Employee Housing Units (EHU's) units, which are scattered
in various developments in Vail. These 56 units have occupancy restriction (they can only be owned by
or rented to a household with an employee who works 30 or more hours in Eagle County). These units
have no initial or resale price restrictions, nor are they tracked by the Town of Vail.
Inventory of Deed Restricted Units in Vail
Shading denotes focus of analysis.
Location
# Units
Arosa Duplex
2
North Trail Townhomes
6
ERWSD Pitkin Creek & Trailridge
2
Red Sandstone
18
Vail Commons
53
Employee Housing Units (EHU)
56
Total
137
Not all of these units are owner occupied, including 9 units at Red Sandstone — 7 are owned by the Eagle
River Water and Sanitation District and renter occupied and 2 are owned by Mountain Valley
Development Services.
This analysis will focus on the 79 units shaded in the table above since they are the most comparable to
the proposed Chamonix units in terms of deed restrictions and method by which they are sold to
qualified buyers.
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Arosa Duplex
A LEED Silver Certified duplex completed in 2010 and located at the start of Arosa Drive in West Vail, this
development is comprised of two units, each with three -bedrooms, two and one-half bathrooms and
attached two -car garages. These units are two floors and are approximately 1,500 square feet of living
area plus garages. Since this project is fairly new, applicants for these units are considered in the
Demand Analysis section of this report.
Units are located at the west end of North Frontage Road,
where it turns north and becomes Arosa Drive. The City
Market center and associated services are less than one mile
east on North Frontage Road from the development. A
transit stop is located about two-tenths of a mile from the
duplex.
The duplex is nestled on a small, relatively flat site at the end
of a gulley. Residential uses are across the street and north
of the site. The duplex gets good sun exposure, with one
unit having south, east and west facing exposure and the
other having north, east and west exposure. Views to the
south look upon 1-70 and the mountains; hills/mountains are seen in the other directions. Noise from I-
70 is very apparent.
The Arosa units sold in 2010 for $402,300 and $410,300, or $254 per square foot.
North Trail Town Homes
This six -unit complex completed in 2001 is located at the intersection of Arosa Drive and Garmisch Drive.
This development is comprised of:
4 two-bedroom, two -bath townhomes located in a four-plex, all with attached one -car garages.
These units are two floors and start at approximately 1,230 square feet.
2 three-bedroom, two -bath townhomes located in a duplex, with attached one -car garages.
These units are two floors and start at approximately 1,440 square feet.
This complex has little exposure to 1-70 noise. It also has the best park access of all comparables, being
located adjacent to Ellefson Park, providing usable outdoor recreation space for the residents. It is
located in quiet residential neighborhood along Garmish
Drive, which dead ends just east of the development.
Duplex units face north/south and the 4-plex faces
east/west with views of hills and mountains in all
directions.
The nearest transit stop is about four -tenths of a mile
from the development. The nearest large grocery store
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(Safeway) is less than one mile, along with restaurant, fuel, convenience store, mail, lodging and
shopping services.
One of the six units in North Trail townhomes has sold since 2010 for a price of $223,800 or $198 per
square foot.
Red Sandstone Creek
This 18 -unit complex completed in 1999 is located on Red Sandstone Road across from the Potato Patch
Club in Vail. This development is comprised of two buildings with dispersed unit types of:
2 one -bedroom, one -bath townhomes, with attached one -car garages. These units are two
floors and approximately 850 square feet.
10 two-bedroom, one -bath townhomes, with attached one -car garages. These units are two
floors and approximately 1,040 square feet.
2 two-bedroom, two -bath condominiums, with attached one -car garages. These units are one
floor and approximately 1,160 square feet.
4 three-bedroom, two -bath condominiums, with attached one -car garages. These units are
three floors and approximately 1,430 square feet.
Even though some units are townhome style
(two story) all are part of a single condominium
project. The Eagle River Water and Sanitation
District either owns and rents out or has first
right of refusal on 11 units.
These units have had roof problems with some
owners taking out second mortgages for repair.
They have little to no noise exposure from 1-70.
Red Sandstone is located about three -tenths of
a mile north of the North Frontage Road,
nestled among the hills. A creek runs along the
west side of the units. Brookstone
Condominiums are on the other side of the creek, which appear to be a mix of local and second
homeowner occupied units. The units are separated on the east side from the primarily residential and
recreation -access Red Sandstone Road by a berm.
Units face east/west, with good sun exposure. Views of mountains are available to the south, whereas
north and west views are of the surrounding hills and east views include the river valley, Brookstone
we7ii.. u � . u . � •.�ifil�
Public transportation is available via the Sandstone Purple transit line and stops about two-tenths of a
mile from the site. A pedestrian bridge is available within one mile of the units, which crosses over 1-70
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into the Vail town center. The nearest grocery and other resident services are located within the City
Market shopping center, about 1.6 miles from the development along the North Frontage Road.
The development itself has limited shared outdoor space. Hiking is available on the hillsides near the
development.
From 2010 through March 2014, turnover was high at Red Sandstone when 12 of the 18 units sold. This
equates to an average annual turnover rate of nearly 16%. The prices for these units were as follows:
Price Range Price Range
1 BR $168,000 - $177,900
2 BR $174,200 - $213,500
3 BR $235,000 - $249,000
Source: County Assessor records
Vail Commons
Average Price Average PPSF
$172,950
$167
$200,217
$193
$239,975
$197
A complex with 53 for -sale and 18 rental units completed in 1997. The for -sale units are comprised of:
24 two-bedroom condominiums located in three buildings, including either one -and -a -half baths
or two -baths, each with a large exterior storage closet and a shared garage under every building.
These units are one floor and approximately 992 square feet.
13 two-bedroom, two -bath townhomes located in two buildings, no covered parking. These
units are two floors and approximately 1,018 square feet.
6 three-bedroom, two -bath townhomes located in two buildings, all with one -car attached
garages. These units are two floors, were built with an unfinished basement and are
approximately 1,800 square feet.
10 three-bedroom, two -bath townhomes located in three buildings, all with two -car attached
garages. These units are two floors, were built with an unfinished basement and are
approximately 1,850 square feet.
Units are located between the North Frontage
Road and Chamonix Lane, just east of the City
Market in Vail. Groceries and other services
(restaurants, postal, hardware, shopping, vision
care, etc.) are within easy walking distance of the
complex and a day care center is located within
the development. Transit stops are located within
mile of the development. Units primarily face
either north/south or east/west. Units located
adjacent to the frontage road receive the most
highway noise, although 1-70 noise is present
throughout the development. Views of
mountains are available in all directions, with
units located along the perimeter of the development having the best access to views.
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Open space within the development is of limited
usability, primarily providing interior pedestrian
pathways and property drainage. Hiking is available
on the hillsides to the immediate north of the
development.
Of the 53 ownership units at Vail Commons, eight
sold between 2010 and March 2004, a far lower
turnover rate of 3.5% per year than at Red
Sandstone. The prices for these eight units were as
follows:
Price Range Price Range
2 BR $155,400 - $176,700
3 BR $250,300
Average Price Average PPSF
Other Deed Restricted Ownership Units in Eagle County
$166,814 $172
$250,300 $132
There are nearly 650 deed restricted condos, townhomes, duplexes and single-family homes down
valley from Vail in Eagle County (apartments and units in the Roaring Fork Valley not included). Deed
restrictions vary widely from those with employment, income and resale limitations to ones only
requiring that preference be given to Eagle County employees for a defined time when listed for sale.
Down Valley Deed Restricted Ownership Housing
Project location # Deed/Covenant
Restricted Units
Brett Ranch
Edwards
156
Multiple Sites*
Avon
64
Eagle Ranch
Eagle
43
Miller Ranch
Edwards
282
Red Draw Condos
Edwards
16
Riverwalk
Edwards
59
Stratton Flats
Gypsum
26
Total
646
*Larger projects include
the Sheridan, Chapel Square, Wildwood Townhomes
and Grandview.
With 282 units, Miller Ranch in Edwards is by far the largest deed restricted development in
Eagle County. Completed in 2006, it offers 69 single family homes, 64 duplexes, 49 townhomes
and 100 condominiums. Features that make this development particularly attractive include
walking distance to schools, ample parks/green space and neighborhood design. Deed
restrictions limit price appreciation and occupancy to county residents who are employed, earn
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at least 75% of their income within the county and are qualified for the Valley Home Store's
Master Buyers List.
Red Draw Condominiums is a 16 -unit development in Edwards next to the St. Claire of Assisi
Church has both local employment occupancy and resale price restrictions. The two-
bedroom/two-bathroom units initially sold for $263,600.
Riverwalk Condominiums in downtown Edwards has restrictions that limit sale to Riverwalk then
Eagle County employees for 90 days before anyone can purchase.
Brett Ranch in Edwards has covenants that impose a 1% transfer fee on sales to households that
do not include Eagle County employees or that own another residential property.
Stratton Flats in Gypsum is a single family home development offering three and four bedroom
homes with two -car garages starting around $240,000. Of the total of 339 units at build out, six
were built under deed restrictions that limit price and occupancy. A modified deed restriction
limiting occupancy to Eagle County employees has been applied to about 20 units. These units
have sold for market prices with a small incentive (1% - 1.5%) for closing costs.
The deed restricted housing inventory in Avon includes 64 units scattered through the
community in nine developments (apartment project excluded). Most units have occupancy
restrictions (employment 30+ hours per week in Eagle County and incomes no greater than
120% AMI) and limits on capital improvements and resale prices. Of the 64 units, 13 are still
owned by their developers and rented to employees. There is little turnover among the units.
Amenities/Design Features
Interviews of staff involved in managing/selling deed restricted housing as well as realtors revealed
consistent opinions about the features most desired by local homebuyers. They are:
1. Storage — Mountain residents have lots of gear and recreational equipment. Plus outdoor
furniture and grills must often be moved into storage in the winter so as not to impede snow
removal. In -unit spaces, exterior storage lockers and extra space in garages have all worked well.
Garages/Parking — Parking is very tight throughout most of Vail. While residents often take a
bus, walk or bike to work, they have cars for other errands and travel. With a harsh winter
climate, garages are highly desired for parking as well as storage. It does not appear that there
are strong preferences for private attached garages over common garages with storage lockers
and or detached private garages. Parking for guests is crucial but access should be limited so
that day skiers do not park at Chamonix due to its proximity to a bus stop.
3. Outdoor Space — Common outdoor areas should be functional, large enough and designed so
that it can be used for more than open/green space. It should be sunny. Grills, tables, seating,
space for a garden, a play area for children, and a play area for dogs would all be appealing.
Small private fenced outdoor areas for children and/or dogs is highly desired by many.
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4. Access to Sunlight and Views — Vail is known for having limited access to the sun in the winter.
More sunlight has been cited by buyers of down valley housing as a reason for not considering
Vail. Fortunately for the Chamonix site, access to one will provide access to the other — south
facing units get the most sun and the best views are to the south. North facing walkways, front
doors and garages entrances can be problematic. Positioning all units so that each has a south
facing wall would be ideal.
5. An Extra Bedroom — While many of the owners now living in Vail's deed restricted housing and
many of the potential buyers are single they want the opportunity to rent to a roommate even if
only seasonally. Also, residents of resort communities tend to have a lot of company during
peak winter and summer periods. Most want one more bedroom than they absolutely need.
6. Energy Efficient Heating System — Utilities can be very expensive in Vail. Heating systems are
typically used nine months per year and occasionally even in the summer months. New, energy
efficient systems, especially in floor heat, would be very appealing when compared to the
systems in the older residential units in Vail and would keep heating bills comparatively low.
7. Convenient Access to Bus Stop — Sidewalks and internal walkways should be designed so as to
make it easy to travel, wearing ski boots, from units to the bus stop.
8. Mud Room —Since Vail's residents have many boots, coats, hats and gear, a "mud"
room/entryway is far more functional and appealing than a coat closet. Designs that provide an
air lock/doorway between the entry and main living area would also improve energy efficiency.
9. A Second Bathroom — Whether for use by a roommate, family member or guest, most buyers
seek two bathrooms.
Other design features that should be a given but that have been overlooked in the past include:
Outdoor spigots —the lack of them has been a problem at Miller Ranch;
Roofs that last given snow loads without features that create ice dams and cause leaking; and
Snow shed/snow storage.
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VII. Demand Estimates
This section quantifies the size of the market and the capture rates for the proposed units taking into
consideration the number of households residing within the market area by income and household size,
in migration of households from outside the market area, and projected growth in households.
Market Segmentation
To estimate the potential size of the market for the proposed Chamonix homes, the profile of buyers is
analyzed to segment those who qualify and are most likely to qualify.
From Where
The potential market for deed restricted homes in Vail primarily consists of persons who already live in
or near Vail. Very little movement up valley of families from Eagle and Gypsum should be expected
although interest would likely be higher among some now living in Edwards.
Results from a 2007 household survey in Eagle County showed there is not strong interest in moving
from mid valley and down valley communities to Vail. Of the residents who indicated Vail was their first
choice in which to live, 65% already lived within the community, 4% lived in the unincorporated area
adjacent to Vail, 6% lived in Eagle -Vail, 4% in Minturn and 4% in Avon. Only 8% lived in Edwards and 3%
in the Eagle area.
Preference to Live in Vail
Where Now Live
Want to Live
in Vail
Edwards
8%
Eagle/Brush Creek
3%
Gypsum/Gypsum Creek
3%
Vail -Incorporated
65%
Avon
4%
Basalt/EI Jebel/Frying Pan
1%
Minturn/Redcliffe
4%
Eagle -Vail
6%
Other
1%
Vail -Unincorporated
4%
Wolcott/Bellyache Ridge
1%
100%
Source: 2007 Eagle County Housing Needs Assessment
Respondents to the 2007 survey were also asked whether they wanted to buy or rent a different
residence and which community they preferred. Results showed that:
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Edwards was the number one choice of where residents looking to buy most want to live
followed by the Eagle/Brush Creek area; and
Vail was third overall with nearly 15% of those surveyed indicating it was their first choice.
There has been a fundamental shift in location preferences. According to the 1999 Eagle County
Housing Needs Assessment survey, Vail had the highest ranking of where Eagle County's residents most
wanted to live (22%) followed by the Edwards area at 20% and Eagle at 12%.
The mix of applicants for the Arosa duplex lottery supports the 2007 survey findings. Of the 11
applicants, nine were living in Vail or Eagle -Vail at the time of application and two were living in
Edwards, indicating that housing in Vail will primarily attract persons who already live in or near Vail.
Arosa Duplex Lottery Applicants
Household Type
Where they lived @ application
Priority Purchasers
Couple with child
Vail Commons
Couple with child
Eagle -Vail Townhouse
Couple with 2 children
East Vail
Couple with child
Eagle -Vail Townhouse
Couple with child
West Vail
Single with 2 children
Edwards
Non -Priority Purchasers
Couple no children
Red Sandstone
Couple no children
Vail Commons
Single
Vail Commons
Couple no children
West Vail
Single with 1 child
Edwards
There is less correlation between job location and where residents most want to live than might be
presumed. According to the 2007 survey, about 40% of employees working in Vail indicated their first
choice of location to live is Vail.
Length of Residency
Most buyers of deed restricted properties are long-time residents. Very few buyers will be new to the
area. Although not tracked, the typical applicant for Vail's lotteries has lived in Vail for about 10 years.
Of the 31 buyers of Miller Ranch homes in 2013, only one was moving in from outside of the county.
The 2007 Housing Needs Assessment survey found that only 2% of homeowners in the county had lived
there for less than one year. Most (69%) had lived in the county for 10 or more years.
First Time or Move-Up/Move-Down
The majority of Chamonix purchasers will be first-time homebuyers, probably 75% or more
based on historical sales.
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Some will be moving within the deed restricted system, either moving up as families grow or, as
has been increasingly the case, buying two residences to replace one in the event of divorce.
There have been a few cases where buyers have sold free market homes down valley and
purchased deed restricted housing in Edwards. The extent to which this is likely to happen at
Chamonix is hard to judge, but the possibility may increase as the free market appreciates over
time.
Household Composition
Compared with Eagle County households overall, residents who indicated Vail was their first choice of
where to live in the 2007 survey were more likely to live alone or with roommates than were residents
who preferred to live down valley. Approximately 37% of the county's households overall compared
with 25% of those who wanted to live in Vail included at least one child.
Of the 79 fully deed restricted ownership units in Vail, 37 (or 47%) are now occupied by singles without
children. Families own about 42% of the units. The rest are owned by the Eagle River Water and
Sanitation District or Mountain Valley Developmental Services and are rented. A couple lives in the only
one bedroom unit that is owner occupied.
Three of the 24 three-bedroom units are owned by a single individual without children; 16 are occupied
by households with at least one child (typically one). Of the 53 two-bedroom units, 34 were purchased
by singles.
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OVERALL
Vail —1'
Choice
Couple with child(ren)
27%
20%
Couple, no child(ren)
27%
25%
Adult living alone
23%
31%
Unrelated roommates
10%
17%
Single parent with child(ren)
8%
4%
Family members and unrelated roommates
3%
2%
Immediate and extended family members
2%
1%
Other
1%
100%
100%
Source: 2007 Housing Needs Assessment Survey
Of the 79 fully deed restricted ownership units in Vail, 37 (or 47%) are now occupied by singles without
children. Families own about 42% of the units. The rest are owned by the Eagle River Water and
Sanitation District or Mountain Valley Developmental Services and are rented. A couple lives in the only
one bedroom unit that is owner occupied.
Three of the 24 three-bedroom units are owned by a single individual without children; 16 are occupied
by households with at least one child (typically one). Of the 53 two-bedroom units, 34 were purchased
by singles.
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Household Composition — Owners of Vail Deed Restricted Units
Single Single w/ Couple Couple w/ Other Total
Child(ren) Child(ren) Units
Vail Commons
2 BR 25 2 10 37
3 BR 3 3 1 8 1 16
Red Sandstone
1 BR 1 1 2
2 BR 6 1 5 12
3 BR 1 1 2 4
North Trail Townhomes
2 BR 3 1 4
3 BR 2 2
Arosa Duplex
3 BR 2 2
Total 37 7 14 12 9 79
Percent of Total 46.8% 8.9% 17.7% 15.2% 11.4% 100%
There are distinct differences between buyers interested in Edwards and those who prefer to live in
Eagle or Gypsum. Edwards attracts singles as well as families, appeals to those who work mid valley or
who commute in both directions, works well for residents who like to ski often, is attractive to
households that prefer greater diversity in the community and are interested in higher density
multifamily housing.
Market Size
Approximately 3,100 renters reside in the area that includes Vail, Eagle -Vail and Avon. This area should
be considered the primary market area for the proposed Chamonix development since:
Past surveys have shown in interest in living in Vail is highest among existing residents; and
Lottery applicants and buyers of deed restricted housing in Vail lived in or near Vail at the time
of application.
Of these 3,100 renter households, roughly 1,600 households have incomes within the ranges specified
by the Chamonix Master Plan (60% AMI to 140% AMI). How the proposed units are ultimately priced
will impact the extent to which they are actually affordable for the wide range of targeted households.
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Market Area Renter Households by Income and Size, 2013
Income Range
1 -Person
2 -Person
3 -Person
4 -Person
5+ -Person
Total
60%AM1
$36,540
$41,760
$46,980
$52,140
$56,340
N/A
140% AMI
$85,260
$97,440
$109,620
$121,660
$131,460
$0-10,000
211
69
6
16
0
302
$10,000-20,000
189
23
115
9
10
346
$20,000-30,000
32
157
68
99
13
369
$30,000-40,000
83
46
107
22
148
406
$40,000-50,000
123
174
43
32
2
374
$50,000-60,000
132
171
94
21
11
429
$60,000-75,000
97
126
37
54
67
381
$75,000-100,000
15
166
37
97
9
324
$100,000-125,000
16
30
36
9
7
98
$125,000-150,000
4
2
9
9
0
24
$150,000-200,000
11
32
10
0
0
53
$200,000+
6
1
1
0
0
8
Total
919
997
563
368
267
3,114
Within Targeted
Income Ranges
450
637
247
181
94
1,609
% by Household Size
28.0%
39.6%
15.4%
11.2%
5.8%
100.0%
Source: Ribbon Demographics data and Rees Consulting
calculations
Demand Estimate
There is total potential demand for approximately 1,850 ownership units in Vail generated by
households with incomes in the ranges targeted by the Chamonix Master Plan. The proposed 58 units
would need to capture 3.1% of this demand, which is a low capture rate.
Demand and Capture Rate Calculation
# Households
Market Area Renter Households 3,100
In Targeted Income Ranges 1,600
Growth within 2 Years (2% per year) 65
Total Up Valley Market 1,665
In Migration (from down valley or out of county) 10%
Total Demand 1,850
Capture Rate (58 units proposed) 3.1%
This estimate of potential demand includes households that may not want to buy or may not be able to
buy because they cannot qualify for a mortgage; however, with a conservative capture rate of only 3.1%,
it appears that demand is more than adequate for the proposed units.
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While four of the 11 applicants for the Arosa lottery were seeking to move up from existing deed
restricted housing within Vail (Vail Commons and Red Sandstone), the vacated units will need to be sold;
therefore, demand from existing owners has not been considered in this calculation.
Lottery/Buyer Applicants
Information on lottery/homebuyer applicants is provided for additional insight into demand.
The Valley Home Store maintains a Master Buyers List with approximately 100 applicants
currently who are pre -qualified under both Eagle County's Guidelines and for a mortgage. Of
these applicants, roughly 20% include a member who works full time in Vail. At least some of
the applicants on the list are potential buyers for Chamonix.
The Town of Vail has had an average of 8.4 applicants over the past five years for its annual
lottery (between 13 and three applicants each year). This lottery has been for resales; a
separate lottery was held for the Arosa duplex units. No other new units were completed
during this period. Lottery fatigue and perceptions that there was nothing available may have
resulted in fewer households participating in the lottery than were interested in purchasing
housing.
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VIII. Mortgage Availability
Obtaining home mortgages has been more difficult since the recession due to the imposition of stricter
lending standards. Further, mortgage availability is complicated by deed restrictions, leased land and
condominium ownership. Through interviews of mortgage lenders, this section of the report examines
how mortgage availability, deed restrictions/complications and interest rates affect the ability for
households to purchase and afford homes.
Loan Products
Mortgage lenders provide a full array of loan products for deed restricted housing in Eagle County,
including:
Conventional mortgages sold on the secondary market most often under Fannie Mae guidelines;
Portfolio loans held by the originating lenders and underwritten based on in-house criteria.
These are most often 5- or 7 -year adjustable rate mortgages (ARM'S), but at least one lender
can offer 30 -year fixed rates; and
Government insured or guaranteed loans for 15- or 30 -year fixed rate mortgages — USDA for
which no down payment is required and FHA that requires about 3.5% down. None of the
lenders interviewed are now processing VA loans for deed restricted housing due at least in part
to their understanding that VA requires deed restrictions to have income caps, which is typically
not the case in Vail or Eagle County.
Not all lenders provide all these loan products. Some provide only portfolio loans on deed restricted
homes, while others also offer conventional and possibly government loans.
Deed Restriction Limitations
Deed restrictions must be approved by lenders. There are generally two approaches:
In house approvals by larger lenders with the restrictions submitted for each individual loan
application. This is the way it has typically been done in Eagle County. The requirements vary
somewhat by lender.
Project approval by Fannie Mae and/or FHA that would then allow any lender to originate
conventional/secondary market mortgages for units within the development. The application
process can be time consuming. Fannie Mae requires an application fee, and the approval is in
effect for only two years.
Lenders often apply their own unique limitations or "overlays" on top of Fannie Mae/USDA/FHA criteria.
While underwriting guidelines vary, the following requirements are typical:
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The deed restriction must terminate at foreclosure or deed in lieu of foreclosure. Fannie Mae no
longer imposes this requirement, but lenders in Eagle County have not yet dealt with
restrictions that survive foreclosure;
The appraisal has to include three comparables with similar deed restrictions;
The lender is not required to send notices of foreclosure to third parties, including the Town or
other entities that might have an interest in preservation of the deed restriction;
Right of first refusal will only be granted to the entity that applied the deed restriction and the
time period for acting on the right cannot exceed 90 days;
Resale controls must have a fixed period of time; and
The deed restriction must be in a public record identifiable through a routine title search.
Lending on Condominiums
Mortgage lending on condominiums is more complex and time consuming than for townhomes,
duplexes and single-family homes for which the underlying land is subdivided. Several requirements are
typically imposed that limit loans for condominiums, including having too many renter -occupied units in
the complex, too many units owned by one party (as is the case at Red Sandstone where the Eagle River
Water and Sanitation District owns seven units) and mixed/commercial uses on site. At least one local
lender will not provide any long-term, fixed rate loans on condos at this point in time. A limit on the
number of loans that can be made by a mortgage company on any one project is also common to limit
their exposure (usually calculated as a percentage of total units in the development).
The interest rate for mortgages on condominiums may also be higher or require more points. The
condominium approval process can be intertwined with deed restriction approval procedures. Since FHA
no longer allows "spot" loans within condominium projects, FHA approval of the entire project is
required. In Eagle County Few projects (maybe only one) have current FHA approvals in place.
None of the deed restricted housing in Vail is FHA approved or has a Fannie Mae master project
approval.
Leased Land
Mortgage lenders typically accept land leases provided that the term extends beyond the term of the
loan by a specified number of years. While leases complicate the mortgage application since
underwriters must review and approve the lease with every application, they do not significantly limit
the types of loans available.
ARM's
While most borrowers prefer loans where their payment is fixed for typically 15 or 30 years, most of the
buyers of deed restricted units in Vail have obtained 5 or 7 year ARM's amortized over 30 years with a
five point maximum lifetime increase in the interest rate. The initial interest rate on ARM's has been
very low in recent years — below 3%, and the annual adjustments have not been to the maximums
allowed since fixed rates have been held low by Federal Reserve polices for a relatively long time. In
other words, ARMS have provided the lowest, most affordable payments possible and have been stable
in recent years.
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Interest rates are going to rise, however. Fixed rates have increased one percentage point since last
year. Mortgage lenders generally feel that rates will remain mostly stable through this year but will
increase starting next year as the Federal Reserve backs down from its economic stimulus efforts.
The Impacts of Interest Rates on Affordability
Interest rates have a profound impact on housing affordability. For every 1/4 point difference that rates
rise between 4.5% (about the current average for a 30 -year fixed rate mortgage) and 5.5%, a buyer's
borrowing capacity decreases by nearly 3%. A one point increase in the rate, as occurred in 2013, would
drop the affordable purchase price for a household with an income of around 80% AMI by $20,000 to
$25,000.
According to a recent quote, the interest rate on ARMs is about 3% for 5 years and 3.5% for 7 years. The
monthly payment for a $250,000 ARM at 3.5% with a 5 point lifetime cap could increase 73% during a
period of rising interest rates, from less than $1,100 to nearly $1,900 in five to seven years.
Interest Rate Comparison for Adjustable Rate Mortgages
Starting Rate Maximum Rate
Loan Amount $250,000 $250,000
Interest rate 3.25% 8.25%
Monthly Payment (principal & interest) $1,088 $1,878
Down Payment Assistance
Eagle County's down payment program was adjusted in recent years to limit the amount provided to no
more than 3.5% of the purchase price. The program has not been utilized much since this change,
however. The availability of funds is currently good. The program is ideal for use with FHA mortgages;
however, the fact that few deed restricted projects are approved by FHA is likely reducing its utilization.
Borrower Profile
Most of the applicants for mortgages on deed restricted units are first time buyers. They tend to be
young singles or families, though there seems to be an increase in middle aged borrowers. Many have
credit issues. One lender indicated about 70% can eventually qualify while 30% cannot. Since the
recession, credit problems have become more frequent. Very few have a 20% down payment and thus
must obtain a government loan or pay for private mortgage insurance. At Miller Ranch, which is the
largest of the deed restricted properties and has had the highest number of sales, between 30% and
50% of buyers have obtained USDA mortgages, which allow loans up to 102% of price or appraised value
in order to cover the program's up -front costs.
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IX. Conclusions and Recommendations
Market conditions appear to be prime now for proceeding with the development of Chamonix. The
availability of housing affordable for households with incomes between 60% and 140% AMI to purchase
is small while potential demand appears to be more than sufficient for the absorption of 53 additional
homes. Specifically:
The economy is recovering with growth in jobs and significant reductions in unemployment.
Projections call for continuation of this trend and population growth of 2% to 2.9% per year
through 2020.
The housing market is rebounding. The number and choice of free market homes for sale down
valley has decreased and prices are starting to rise. Bargains have disappeared and the number
of foreclosures and bank sales has dropped sharply.
The deed restricted units currently in Vail have performed well. All units that have been listed
for sale have sold, commanding the maximum allowable price appreciation.
The inventory of deed restricted units available for sale down valley has largely disappeared.
There are five listings currently, all of which have been placed on the market this year. All units
listed for sale in 2013 were sold or removed from the market by the end of 2013.
Rental availability is becoming increasingly limited and rents are rising; current average market
rents are within the range that it would cost to purchase a Chamonix home at the targeted
incomes.
Demand for deed restricted ownership opportunities is increasing with a record number of sales
at Miller Ranch last year, an increase in lottery applicants (both Town of Vail and the Valley
Home Store), and approximately 100 pre -qualified applicants on the County's Master Buyers
List. Knowledge that the housing market has bottomed out and that prices are starting to rise,
combined with concerns about interest rate increases, are spurring residents to buy.
Potential demand from households that are most likely to buy at Chamonix (i.e., households
that now rent in or near Vail, have incomes in the 60% to 140% AMI range, and have from one
to five members) appears be to be adequate for the proposed units with a low required capture
rate of less than 4%.
To be responsive to demand and competition with limited but nonetheless attractive choices, some
modifications to the existing development plan are recommended. These include some revisions to
Master Plan concepts (unit mix and size) and additional recommendations for pricing, amenities/design
features, marketing and mortgage options to enhance marketability of the proposed homes.
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Competition
From within Vail
Competition from within Vail is very limited. Of the units listed for sale under $500,000, only three
condominium units and one townhome could be considered comparable to the proposed Chamonix
units in terms of their suitability for year-round workforce households. While they offer a choice for
households that might consider Chamonix, they are 42 to 48 years old and have no garages,
outdated/inefficient heating systems, and HOA dues that are likely higher than will be charged at
Chamonix. The one with an EHU restriction in place has been on the market for about one year.
Interest in the unrestricted units has been higher, in part due to developers wanting to buy units to
satisfy their employee housing requirements. Their price range from $432,500 to $495,000 sets an
upper limit for Chamonix.
Only two units in Vail with full deed restrictions as envisioned for Chamonix are listed for sale or soon
will be, with maximum allowable prices of $212,544 and $236,248. The competition that Chamonix will
create for current owners who desire to sell their deed restricted homes should be a concern only if the
new units are priced lower than existing units.
From Down Volley
A total of 78 units down valley from Vail were listed for sale through the MLS in early April at prices less
than $500,000. Prices per square foot were far lower than in Vail and decreased the farther down valley
the units were located (527 in Vail, $308 in Edwards, $212 in Eagle and $193 in Gypsum). The free
market is not generating significant competition in Edwards — only a few condominiums and townhomes
were in this price range. A couple of small single family homes were listed for sale in Eagle for less than
$400,000, but Gypsum is the only community were buyers can choose among new single family homes
in the $300,000 to $500,000 range. The competition generated by homes in Gypsum and, to a smaller
degree, Eagle for families with children should decline as the market continues its recovery. Regardless,
the distance and the difference between Vail and Gypsum is so great, that attempting to set prices for
Chamonix based on prices in Gypsum is not necessary — direct competition with these units will be
limited.
The deed restricted homes down valley, particularly in Edwards, provide attractive alternatives to
purchasing at Chamonix. The neighborhoods like Miller Ranch, Eagle Ranch and Stratton Flats are
attractive, well designed, near schools and parks and convenient to many jobs. They offer single family
homes, which Chamonix will not provide. Yet availability is now low and no new deed restricted
developments are currently planned. Five deed restricted homes were listed for sale in Edwards and
Eagle through the Valley Home Store as of late April, with list prices that ranged from $183,000 for a
condominium to $390,000 for a single family home at Miller Ranch.
Miller Ranch will pose the greatest competition since it has so many units (282), has K-12 schools within
a short walk, is a much shorter commute for employees working in the Vail area than Eagle or Gypsum,
offers a variety of unit types (15 different models ranging from condominiums to single family), offers a
wide range of pricing and is in Edwards, which appeals to singles as well as families. While the Chamonix
site is suitable for housing, the proximity to commercial uses and the lack of schools and parks within
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walking distance make it less desirable for families with children. The pricing and value of homes at
Miller Ranch should be considered when designing and setting prices for Chamonix.
Family Orientation
Approximately 20% to 30% of the buyers at Chamonix will have children. Expectations that Chamonix
will primarily target families is counter to experience among other properties, demographic trends and
resident preferences. Specifically:
25% of the county's households that prefer to live in Vail include at least one child.
24% of the deed restricted units in Vail are occupied by households with at least one child.
32% of the renter households with incomes in the targeted income range have three or more
members, but this figure includes roommate households; 28% live alone and 40% are two -
person households.
These statistics reflect what all of the key informants interviewed as part of this study relayed -
households with school age children have housing options down valley that better meet their family's
needs and preferences. Few families have moved back to Vail when three-bedroom homes have
become available; the large majority of applicants for those homes lived in or near Vail. Chamonix will
be ideal for couples, however, who plan to have children. Over time, the number of households with
children living at Chamonix will probably increase.
Income Targets and Pricing
The Master Plan target of 60% AMI to 140% AMI is a wide range to serve in one 58 -unit development.
Prices that are affordable for 60% AMI households would be much lower than what a household earning
140% AMI could afford and would likely pay for a larger/higher quality home. In 2014 figures, the
income range would extend from less than $40,000 to over $120,000. Serving this entire range will
necessitate a wage range of prices, from about $135,000 to just over $450,000.
At the upper end, pricing units at the 140% AMI level is not recommended for several reasons:
Single family homes are available in Edwards at Miller Ranch for less ($350,000 - $390,000).
Historically, deed restricted housing in Vail has been priced at similar or lower levels than at
Miller Ranch.
The market is providing housing in this price range in Vail. While only four units were listed in
early April for less than $500,000 that are well suited for ownership by year round residents,
buyers generally expect deed restricted units to be priced below the free market.
There are relatively few renter households residing within the Vail/up-valley area that have
incomes at and above 140% AMI. The income distribution shows a drop in households between
100% and 120% depending upon household size. Of the relatively few with incomes above
$140% AMI, most are two -person households and many of them are likely roommate
households.
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While some households may want to move up from existing deed restricted homes in Vail, the
incomes of these households are not known and the step up would large in terms of price. For
example, the last two-bedroom unit at Vail Commons to sell was priced just over $250,000. To
purchase a three-bedroom home priced around $450,000 for 140% AMI households would
result in a significant increase in the monthly payment. Unless research on existing residents of
Vail's deed restricted homes documents move up desire and capacity, Chamonix pricing should
not extend to the 140%AMI level.
At the lower end, developing units for households with incomes as low as 60% AMI (roughly $135,000 to
$175,000) will require substantial subsidies. It will also likely be more challenging for households at this
income level to obtain mortgages. There are a significant number of renters with incomes in the 60% to
80% AMI range, but there are more with incomes between 80% and 100% AMI.
It is therefore recommended that prices at Chamonix:
Be primarily affordable for households in the 80% to 120% range. If sufficient subsidies are
available, providing some units for 60% AMI households should be considered, but pricing as
high as 140% AMI is not advised at this time.
Be set lower than at maximum affordable levels. For example, to serve households with incomes
at 80% AMI, prices should be set at 75% AMI, or even lower during periods of rising interest
rates.
Possibly be structured using income tiers. In other words, identical units could sell for different
amounts. This pricing technique is common for deed restricted units where the restrictions
impose income limits. This has not been the way that Vail's deed restrictions have been
structured in the past.
Be set with the expectation that interest rates will rise.
Unit Size, Type and Bedroom Mix
To serve a variety of households with incomes in the 80% AMI to 120% AMI variety in unit type and size
is recommended. Specifically:
The size range should be expanded. As proposed, units would range in size from 1,292 for two-
bedroom flats to 1,632 square feet for three bedroom duplexes. These sizes are relatively large.
o Two-bedroom flats could be as small as 800 to 900 square feet and still be very livable
provided that garage/storage space is provided.
o Townhomes could range from 1,200 to 1,400, perhaps smaller depending upon price.
o Duplexes units would be attractive as currently envisioned (1,632 SF) but could be
marketable at 1,300 to 1,400 square feet.
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Consideration should be given to reducing the number of condominiums and offering
townhomes. Each unit could have a south facing wall, private garages might be feasible,
mortgage availability/pricing would improve, the development would lend itself more readily to
phasing, and it would allow for private outdoor space.
Provide variety within unit types, perhaps two or three models, so as to allow for a wider range
of pricing, provide more choice for buyers and enhance marketability.
The bedroom mix could be adjusted to offer slightly fewer three-bedroom units. Existing deed
restricted properties already disproportionately accommodates families with about 30% of units
(not counting EHU's) having three bedrooms. As now proposed, 38% of the Chamonix units will
have three bedrooms.
Mortgage Availability
Mortgage availability for the proposed Chamonix units will be complicated by:
Deed restrictions limiting purchase to eligible households;
Building at least some of the units as condominiums; and
Developing the project on land leased from the Town of Vail.
With interest rates on the rise, the availability of 30 -year, fixed rate mortgages will become more
important to the marketability of deed restricted housing. Although most of Vail's buyers have been
willing to obtain ARMs in the past, more borrowers prefer a 30 -year fixed rate and, with rate increases,
will insist upon it. Furthermore, limitations on mortgage availability will negatively impact Chamonix's
competiveness relative to Miller Ranch, where about half of the buyers in recent years have obtained
USDA loans with the lowest fixed rates available and no down payment.
To increase the type of mortgages available and the lowest/most competitive interest rates for
borrowers:
Consider redesign of the proposed flats and lofts so that all or at least some of the units are
townhomes rather than condominiums.
Work with local lenders to obtain approval of the deed restrictions and land leases so that both
conventional, government (USDA, FHA and VA) and portfolio loan products are available.
Explore obtaining Fannie Mae and FHA direct approval of the project.
Divide the development into multiple HOA's so that the duplex units and townhome units, if
built, are not subject to the same limitations and rates as condominium units.
Provide a lender referral packet to applicants that describes the various loan projects each
lender offers and compares fixed to adjustable rate alternatives.
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Marketing
Vail's once a year lottery system has worked adequately for resales and project -specific lotteries have
generated sufficient buyers in the past. Chamonix will be the largest deed restricted development built
to date in Vail, however. Given this, the following steps are recommended to enhance sales:
Provide a more flexible sale system than a single project lottery.
Pre -sell to allow for interior finish choices.
Work with the Valley Home Store to access their Master Buyers List.
Amenities/Design Features
To enhance the livability and competitiveness of the Chamonix homes, the following should be
provided:
Garages, space for parking at least two cars per unit and adequate guest parking;
Additional storage suitable for bikes, skis and other recreational gear;
Small fenced outdoor areas for small children and dogs;
Functional common outdoor areas;
Access to sunlight and views (each unit should ideally have some south facing exposure);
A mud room;
Adequate sound proofing from 1-70 noise;
A landscaped buffer between the site and the adjacent commercial uses;
Energy efficiency; and
Convenient pedestrian access to the bus stop.
It is important to make the outdoor areas at Chamonix functional for more than open/green space. The
semi -private areas between the duplexes should be fenced. The green areas on either ends of the
parcel should be developed for use, perhaps a dog park and a playground. The areas between the row
of duplexes and multifamily units to the south should be usable yet not too noisy.
Phasing
If the recommendations provided herein are followed with variety in unit type, size, pricing and
mortgage availability in combination with well-designed units, desirable amenities and a flexible
marketing system, phasing will likely not be necessary. Applications and presales could be used to test
the validity of this conclusion, with adjustments made if it appears that the length of time for the units
to sell will exceed the Town's ability to retain ownership of units after their completion. Construction
phasing would be inconvenient and disruptive to initial buyers, would be more costly in the long run and
would be difficult for condominium units.
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Appendix
Change in Renter Households: 2000 - 2010
Source: 2000 and 2010 US Census
Renter Household Composition by Area, 2010
J Vail
# Renter Households 1,340
Up Valley Eagle
County
3,336 6,893
'
2000 # renter -households
1,032
2,917 176,8937
18%
renter-households
47.7%
48.0%
2010 # renter -households
1,340
3,336
renter -households
51.5%
49.3%
35.8%
% Change in renter households
29.8%
14.4%
25.4%
# Change in renter households
308
419
1,394
Source: 2000 and 2010 US Census
Renter Household Composition by Area, 2010
J Vail
# Renter Households 1,340
Up Valley Eagle
County
3,336 6,893
Renter -Occupied
51.5%
49.7% 35.8%
16%
18%
18%
Renter Households by Type
8%
12%
Family, no children
11%
15% 18%
Family, with children
8%
19% 29%
Living alone
36%
29% 26%
Non -family, roommates
45%
37% 27%
100%
100% 100%
Source: 2010 US Census
Renter Household Size by Area, 2010
Persons per Unit
1 -person
2 -person
!fail
36%
37%
Up Valley
29%
32%
Eagle
26%
30%
3 -person
16%
18%
18%
4 -person
8%
12%
14%
5+ person
2%
8%
13%
Average size
2.04
2.45
2.68
Source: 2010 US Census
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Change in Age of Renter Households: 2000 — 2010
Source: 2000 and 2010 US Census
For -Sale Listings in Vail, At or Under $500,000
April 2, 2013
Price
Vail
Up Valley
Eagle County
Scl Ft
2000 (total renter households)
1,032
2,917
5,499
15 to 24 years
21%
22%
17%
25 to 34 years
46%
44%
40%
35 to 44 years
16%
18%
22%
45 to 54 years
10%
11%
14%
55 to 64 years
5%
4%
4%
65 years and over
2%
1%
3%
2010 (total renter households)
1,340
3,336
6,893
15 to 24 years
15%
14%
11%
25 to 34 years
42%
42%
36%
35 to 44 years
19%
21%
24%
45 to 54 years
12%
13%
16%
55 to 64 years
7%
7%
9%
65 years and over
4%
3%
4%
$347
100%
100%
100%
Source: 2000 and 2010 US Census
For -Sale Listings in Vail, At or Under $500,000
April 2, 2013
Price
Project/Area
Bdrms
Baths
Scl Ft
Price/SF
Yr Built
Type
$248,500
East Vail
2
1
797
$312
1965
Condo
$267,500
1
1
705
$379
1971
Condo
$275,000
short term rental
1
1
835
$329
1973
Condo
$279,000
Sandstone
1
1
530
$526
1974
Condo
$289,000
1
1
576
$502
1973
Condo
$299,000
1
1
576
$519
1973
Condo
$299,900
East Vail
2
1
865
$347
1965
Condo
$300,000
1
1
728
$412
1980
Condo
$309,900
Vail Racquet Club
1
1
576
$538
1973
Condo
$318,000
2
1
901
$353
1970
Condo
$350,000
2
1
882
$397
1970
Condo
$390,000
2
2
990
$394
1980
Condo
$415,000
Vail Racquet Club
2
2
864
$480
1979
Condo
$415,000
Vail Racquet Club
2
2
864
$480
1975
Condo
$420,000
Vail Racquet Club
2
2
864
$486
1979
Condo
$429,000
Vail Racquet Club
2
2
864
$497
1976
Condo
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$432,500
Chamonix Ln
$432,500
Chamonix Ln
$435,000
2 2
$475,000
Chamonix Ln
$489,000
Lionshead
$495,000
East Vail
$495,000
Lionshead
$495,000
East Vail
$499,000
Lions Sq. Lodge
$499,000
Lions Sq. Lodge
$499,000
Lions Sq. Lodge
Source: Vail Area Realtors
MLS
MLS Listings -
VRB.net
Edwards
4/8/2014
Price
$210,500
$309,000
$310,000
$315,000
$325,000
$329,000
$379,000
$397,900
$399,000
$399,500
$430,000
$438,000
$488,000
$490,000
$495,000
Draft 4-3-14
2 2
1103
$392
1972
TH
2 2
1110
$390
1972
TH
3 3
1792
$243
1972
Condo
3 2
1480
3
1969
Condo
1 1
506
$966
1972
Condo
2 3
1500
$330
1967
Duplex
0 1
308
$1,607
1971
Condo
2 2
1223
$405
1973
Condo
0 1
660
$756
1971
Condo
0 1
660
$756
1971
Condo
0 1
660
$756
1971
Condo
Bdrms SF
2
3
3
2
2
3
2
2
2
1
1
2
1
3
2
924
1393
1259
1415
849
1415
1229
1884
1333
756
1293
1089
1078
2163
1505
Type
Condo
Condo
Condo
Condo
Condo
Condo
Condo
TH
Condo
Condo
Condo
Condo
Condo
TH
Condo
Eagle $189,900
2
908
Condo
$299,000
2
1334
TH
$312,500
2
1016
Duplex
$324,000
3
1809
TH
$325,000
3
1798
SF
$325,000
2
938
SF
$329,000
2
968
SF
$335,000
3
1765
TH
$335,000
3
1717
TH
Rees Consulting, Inc.
Price/SF
$227.81
$221.82
$246.23
$222.61
$382.80
$232.51
$308.38
$211.20
$299.32
$528.44
$332.56
$402.20
$452.69
$226.54
$328.90
$308.27
$209.14
$224.14
$307.58
$179.10
$180.76
$346.48
$339.88
$189.80
$195.11
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$341,000
3
1739
TH
$196.09
$345,000
3
1717
TH
$200.93
$349,000
3
1784
TH
$195.63
$349,000
3
1702
Duplex
$205.05
$375,000
3
2004
SF
$187.13
$400,000
6
2582
SF
$154.92
$407,000
3
2092
Duplex
$194.55
$445,000
4
2756
SF
$161.47
$447,000
3
1892
SF
$236.26
$469,500
5
2905
SF
$161.62
$497,500
3
2453
SF
$202.81
$499,995
3
2822
Duplex
$177.18
$211.70
Gypsum $149,900
3
1152
SF/mod
$130.12
$245,000
4
1647
SF
$148.76
$319,900
2
1213
SF
$263.73
$349,900
3
2029
SF
$172.45
$387,000
4
2992
Duplex
$129.34
$395,000
4
2014
SF
$196.13
$418,000
3
2006
SF
$208.37
$449,000
3
2006
SF
$223.83
$449,000
4
1996
SF
$224.95
$450,000
4
2003
Duplex
$224.66
$465,000
3
1816
SF
$256.06
$477,000
3
2103
SF
$226.82
$479,900
6
3705
SF
$129.53
$485,000
5
4130
SF
$117.43
$489,000
4
2948
SF
$165.88
$489,000
3
1860
SF
$262.90
$192.56
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Chamonix Master Plan
6 January 2009
Adopted by Resolution No. 2,
Series of 2009
Prepared For the Town of Vail by
STAN CLAUSON ASSOMATES
Lam.. .......... . .. .... . .... ..... � I
Drexel, Barrell & Co. a r c h i c e c, s
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Chamonix Master Plan
Acknowledaements
The Chamonix Area Master Plan Amendment is the result of over a year of work on the
part of many individuals. Without the effort of the Vail Town Council, the Chamonix
Advisory Committee, the Planning and Environmental Commission, the Vail Local Housing
Authority, and Town of Vail Staff the Chamonix Area Master Plan would not have been
completed.
Vail Town Council
Planning and Environmental Commission
Dick Cleveland, Mayor
Bill Pierce, Chair
Andy Daly, Mayor Pro -Tem
Rollie Kjesbo, Co -Chair
Kevin Foley
Michael Kurz
Mark Gordon
Sarah Robinson-Paladino
Farrow Hitt
Scott Proper
Kim Newbury
Susie Tjossem
Margaret Rogers
David Viele
Chamonix Advisory Committee
Vail Local Housing Authority
Bob Armour
Mark Ristow, Chair
Jack Bergey
Sally Jackie
Andy Daly
Steve Lindstrom
Rollie Kjesbo
Ethan Moore
Ethan Moore
Kim Newbury
Mark Ristow
Margaret Rogers
David Viele
Town of Vail Staff
Consultants
Stan Zemler, Town Manager
Stan Clauson Associates, Inc.
George Ruther, Community Dev. Director
Studio B Architects
Mark Miller, Vail Fire Chief
Drexel, Barrell & Co.
Craig Davis, Vail Fire Department
Economic & Planning Systems
Nina Timm, Housing Coordinator
Scott Hunn, Former Project Planner
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Chamonix Master Plan
Table of Contents
1.
Project Scope
1
2.
Process
3
A. Overview
B. Advisory Committee
C. Town Council Hearing
D. Refinement of Schemes
E. Sustainability
3.
Final Recommendations
6
A. Advisory Committee
B. Final Town Council Approval
4.
Preferred Option
7
5.
Procedural Requirements
9
6.
Non -Preferred Options
9
7.
Recommended Actions
12
8.
Appendix
12
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Chamonix Master Plan
1. PROJECT SCOPE
The proposed design schemes for the Chamonix Master Plan Area were directed by the
stated goals and objectives developed early in the community participation process.
The consultant team of Stan Clauson Associates, Inc., Studio B Architects, and Drexel,
Barrell & Co. identified a variety of opportunities and constraints from the unique physical
characteristics of the
Chamonix site. The inclusion
of a fire station and student
dormitory further complicated
the layout and programmatic
elements of the site design.
4F The Master Plan Area is
generally south facing and
- .
sloped and occupies a highly
visible location off of the west
• ��~ Vail exit (Exit No. 173) from I-
j� - 70. Highway commercial and
strip mall commercial
development characterizes the uses off of the frontage road and Chamonix Road, with
residential neighborhoods characterizing the use patterns off of Chamonix Lane. The
Chamonix Master Plan Area is located near to bus stops on both the West Vail Red and
Green Loop transit lines. Commercial and employment opportunities are located in the
commercial areas within walking distance of the site.
The Town Council identified eleven development goals to direct the master planning
process. These goals were:
• The site is to be used for development of a fire station and employee housing.
Housing for student fire department employees should be considered in the
design of the fire station.
An ambulance substation could be an ancillary use on the site.
• Energy-efficient and sustainable design and construction techniques are
important. Certification by a particular program (LEED, Green Globes) is to be
investigated, although not mandatory.
• 100 percent of housing developed should be deed -restricted, for -sale employee
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Chamonix Master Plan
housing, with a mix of one-, two-, and three-bedroom units.
• The site should be optimized to provide the greatest amount of employee
housing.
• Re -zoning the site to Housing (H) District is preferred to allow flexibility in design
and development.
• Additional traffic onto Chamonix Lane should be limited.
• One-story of development along Chamonix Lane is acceptable.
• All financing and phasing options will be considered.
• New pedestrian circulation and access routes should be provided around the
site, along Chamonix Road and/or Lane, to ensure connectivity of the
surrounding neighborhood to other areas within West Vail. Existing pedestrian
paths through the site are to be limited.
The charge made by the Vail Town Council to "optimize the site" required that the
planning concepts developed by the design team be evaluated in the context of
adjacent uses. The ultimate goal was to provide a plan for the Chamonix Master Plan
Area that balanced the concepts of density, neighborhood impact, and traffic and
parking concerns with aesthetics, sustainability, and value in a way that would address
the community need for additional affordable housing in a contextually appropriate
way.
The target group for the Chamonix development was families. The target group income
was determined to fall within 60-120% of the Area Median Income (AMI) range for Eagle
County, with a possible inclusion of incomes up to 140% of AMI. In current dollars, this
equated to a household income range of $47,000 to $94,000, with a possible excursion to
$110,000.
An important component to the site plan for the Chamonix Master Plan Area was the
inclusion of a new fire station. Members of the Town Council recommended the fire
station be segregated from the residential use of the Chamonix development for safety
and noise reasons. Dedicated access for emergency equipment was requested, as was
the incorporation of a community room for public gathering. A student dormitory, to
help alleviate the cramped conditions experienced by fire department recruits, was also
requested. Finally, provisions for possible Ambulance District participation were to be
considered.
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Chamonix Master Plan
2. PROCESS
A. History of Chamonix Master Plan Area
The Town of Vail acquired the 3.6 -acre "Chamonix Parcel" in October, 2002, for the
purpose of constructing a fire station, employee housing and land banking. To
achieve the Town's goals the Town of Vail adopted the Chamonix Master Plan in
2005. The Master Plan outlined development areas for a fire station, employee
housing and open space.
In 2007, the Town of Vail was able to acquire the adjacent former Wendy's Site. It
was determined the former Wendy's Site was a more optimal location, from an
emergency services perspective, for a future West Vail Fire Station. Based upon the
acquisition of the new property, the Town of Vail determined it could better utilize
the two parcels if a new, comprehensive master plan process was completed. A
Request for Proposals to hire a new consultant team was issued in September, 2007.
The Team of Stan Clauson Associates, Inc., Studio B Architects, and Drexel, Barrell &
Co. were retained by the Town of Vail to develop this new Chamonix Master Plan.
B. Overview
During a period of six months, the consulting team developed three schemes. The
three schemes, titled Neighborhood Block, Neighborhood Cluster, and Village
Neighborhood, explored varying densities and internal character. Development of
the three schemes benefited from informal and formal meetings with stakeholders
and Town staff and from responses to a survey distributed to potential residents.
Members of the consultant team also attended the Fire Chief Magazine "Station
Style Design Conference" in Phoenix to broaden their understanding of current fire
station design trends. Revisions to the three schemes were periodically presented to
the Advisory Committee for additional input and direction, and these refinements
were subsequently presented to the Town Council.
Information from the Town department heads was considered in the site planning
and design guidelines for the development of the employee housing and fire station
at the Chamonix Master Plan Area. Information from other sources was balanced
with the input gained from the Focus Groups.
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C. Advisory Committee
Chamonix Master Plan
lown Staff
On 16 January 2008 a "Kick -Off" meeting was held for the purpose of introducing the
Chamonix Site Master Plan project to the Advisory Committee. The Advisory
Committee, which was selected by Town of Vail staff as well as citizens, consisted of
representative from the Town Council, the Planning and Environmental Commission,
the Housing Authority, the Vail Fire Department, Community Development, and two
Citizens at large. Duties of the Advisory Committee consisted of reviewing previous
master planning efforts produced for the Chamonix site, engaging in discussions on
new opportunities and changed conditions to be considered during the new master
planning effort, and issuing recommendations to the consultant team on the
parameters that would guide the process and the creation of alternative
development scenarios.
D. Town Council Hearing
The Town Council received an update on the work to date on 20 May 2008. The
consultant team presented three schemes which ranged in total unit counts from 50
to 70 units. Optimizing the density of the site, the Council's charge at the outset of
the master planning effort, was not construed to mean that the maximum number of
units possible for the site should be sought. Rather, the consultant team sought a
balance between number of units and resident population, with special
consideration given to the quality of the experience of living in and around the
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Chamonix Master Plan
development. The Town Council instructed the design team to seek a middle path
on density, considering internal views and character of the surrounding
neighborhoods. There was also a discussion of unit sizes, with the Council inclining
toward larger units of two, there and possibly four bedrooms.
E. Refinement of Schemes
Based on the Council's comments and the request accommodate more family-
oriented units, the schemes were refined to concentrate on the creation of two and
three bedroom units. Units ranged in size from 768 sq. ft for 1 -bedroom units, 1,292 sq.
ft. for 2 -bedroom flats, 1,333 sq. ft. for 2 bedroom lofts, 1,460 sq. ft. for 3 -bedroom
units to 1,632 sq. ft. for 3 bedroom duplex units. Because family housing was the
stated focus of the development, one bedroom units were incorporated sparingly
and generally used as "infill." There was attention to the possibility of providing 4 -
bedroom units. While these were not included in the final unit mix, some units were
designed with expansion potential, where a fourth bedroom could be finished later.
F. Sustainability
Various construction methods and site design techniques
were discussed for the site which conformed to "green"
practices. Both traditional on-site building methods as
well as the use of offsite, factory built construction were
considered for the ultimate construction of the housing
structures. Based on discussions with the Advisory
Committee, offsite, factory built construction became the
preferred method due to the energy efficiencies as well
as lower construction costs inherent with this construction method. Site design
standards which focused on solar orientation, limits to site disturbance, brown -field
development, open space preservation, access to transit, and on-site storm water
retention were integrated into the three schemes as providing the basis for certifiably
sustainable construction practices.
Certification of the project using a third -party certification program, such as the
United States Green Building Council LEED certification process, was considered and
' was included in the cost estimates. The Advisory Committee determined that third -
party certification would create potential advantages in the future marketing of the
development, would leverage the green techniques used in the development to
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1/12/2016
Chamonix Master Plan
encourage or require other private developments to seek the same standards, and
foster community pride. As a part of the third party certification process, on-site
storm water detention, which would minimize impacts from impermeable surfaces at
the Chamonix site to the municipal storm water system, was incorporated in to the
design.
3. FINAL RECOMMENDATIONS
A. Advisory Committee
On 17 July 2008, the final Advisory Committee meeting was held. The consultants
presented the final versions of the three schemes and, after discussing the schemes,
the Advisory Committee members in attendance voted on their preferred scheme for
recommendation to the Town Council. The "Village Neighborhood" scheme, which
was the most dense scheme that featured an underground parking garage, received
six of the ten votes cast, the "Neighborhood Block" plan received four of the ten votes
cast, and the "Neighborhood Cluster" received none of the votes cast. While the
Village Neighborhood became the elected preference of the Advisory Committee, a
subsequent discussion after the vote tended to suggest that there was significant
concern regarding the additional cost and maintenance of the sub -grade parking
garage. This concern was noted and included in the report to Town Council.
B. Final Council Approval
On 5 August 2008, a final presentation of the three schemes was made to the Town
Council. Following an update on the Advisory Committee recommendations the
council voted six to one for the Neighborhood Block scheme as the preferred option.
Reasons given for the preference for the Neighborhood Block scheme ranged from
the middle density character of the scheme, the inclusion of open space, the mix of
units, and the flexibility of unit layout. Council members voiced support for the third
party certification of the project as well as for factory, off-site construction.
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Chamonix Master Plan
4. PREFERRED OPTION
Neighborhood Block
/ 1Xdll��s
A. Overview
The Neighborhood Block scheme contains 58 units. The following unit mix was
proposed:
• No 1 -bedroom units;
• twenty, 2 -bedroom flats;
• sixteen, 2 bedroom lofts;
• eight, 3 -bedroom units; and
• fourteen, 3 bedroom duplexes.
This unit mix provided for 81,696 sq. ft. of housing with a density of 16 dwelling units per
acre. A main access street, which gained access to the site from Chamonix Road,
bisected the site, with 3 -bedroom duplexes on the north side and multi -family units on
the south side. An alley offers secondary access to the multi -family units. The main
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Chamonix Master Plan
street passed through the development to the fire station site. While access to the fire
station was intended to be limited, this configuration allowed for dual points of access
1
to the site, thus alleviating internal traffic congestion.
The landscape located throughout the
plan potential community gathering spots
scheme. Semi -private, stepped courtyards were located between the duplex units.
Turf areas were limited to large open spaces on the east and west ends of the
1
development. The open space on the east end could be utilized for such uses as a
dog park. Landscaping on the east end was kept away from the street to preserve
1
sightlines at the Chamonix Road/Chamonix Lane intersection. The open space on
the west end would provide a viewing area into the fire station operations. For safety
1
reasons, the viewing area was segregated from the fire station by a series of low,
landscaped walls.
The landscape palette utilized native trees and shrubs. Aspens were situated along
p p P 9
the northern edge of the site and gradually "spilled" through the spaces created by
the structures. In these stands of aspen, a native understory of grasses (Thurber's
fescue, wheatgrass and blue -wild rye) was punctuated by (orbs such as columbine,
common lupine, golden banner, and strawberry. Along the southern portion of the
site, where retention ponds were intended to hold and treat storm water runoff, more
water -oriented plants took over. Blue spruce was planted densely to act as a screen
to the commercial uses to the south and 1-70 beyond. Shrub thickets of willow and
birch filled in among the spruce.
B. Fire Station
The fire station design shown in the Neighborhood Block scheme was the consensus
alternative of Fire District staff and the
Advisory Committee. The building
foundation itself provided retention of
z -
the steep slopes to the north of the site,
and thereby offered the most cost-
_ /? effective site design.
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5. PROCEDURAL REQUIREMENTS
Following extensive analysis of both the Chamonix Parcel and the Wendy's Site, staff
determined the Official Land Use Map for the Town of Vail should be amended to reflect
the new designation of Chamonix Master Plan Area. The designation of Chamonix
Master Plan Area is harmonious with the residential and commercial uses in the
surrounding neighborhood and achieves the development goals listed above.
Both properties were rezoned to reflect the development goals of the Chamonix Master
Plan Area. The 3.6 -acre parcel commonly known as the Chamonix Parcel was rezoned
from Two -Family Primary/Secondary (P/S) zone district to Housing (H) zone district
(Ordinance No. 27, Series of 2008)and the 1.25 -acre former Wendy's Site was rezoned
from Commercial Core 3 (CC3) zone district to General Use (GU) zone district (Ordinance
No. 26, Series of 2008) on November 18, 2008.
Ultimately, the fire station itself will require the approval of a Conditional Use Permit by
the Planning and Environmental Commission (PEC) in the General Use (GU) zone district
as it is a conditional use rather than a permitted use in all zone districts.
The master plan is intended to be used as the development guide for the Chamonix
Master Plan Area. The plan identifies the location for the fire station and the employee
housing. The plan locates the highest density employee housing to the south of the lower
density employee housing. This layout ensures the greatest compatibility with the
adjacent neighbors. Locating the fire station on the southern edge of the property also
locates this more commercial type use farthest from residential development.
6. NON -PREFERRED OPTIONS
A. Neighborhood Cluster Overview
The Neighborhood Cluster scheme contained 50 units. Unit mix consisted of:
• four, 1 -bedroom units;
• eight, 2 -bedroom flats;
• sixteen, 2 -bedroom lofts;
• fourteen, 3 -bedroom units; and
• eight, 3 -bedroom duplexes.
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Chamonix Master Plan
The unit mix provided for 68,232 sq. ft. of housing with a density of 14 dwelling units
per acre. A main access street, which gained access to the site from Chamonix
Road, passed through the site to the fire station, again offering dual points of access.
Access to the fire station was limited for safety reasons. Multi -family units were
situated off the north and south side of the access road. Drives extend to the north
off the main street to duplex units.
The landscape plan, similar to the Neighborhood Block scheme, located community
gathering spots throughout the design. These community spots utilized terraced
courtyards which were located off of internal pedestrian circulation routes. As with
the Neighborhood Block scheme, turf areas were provided on the east and west
ends of the development, connected by a pedestrian trail. The turf area on the
eastern portion could be utilized for an amenity such as a dog park, while the
western turf area offered a segregated vantage point of the fire station operations.
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B. Village Neighborhood Overview
A
The Village Neighborhood scheme contained 70 units. This scheme offered a
combination of lower density duplex and multifamily units and a multi -story, multi-
family structure. Unit mix consisted of:
• nine, 1 bedroom units;
• thirty-two, 2 bedroom flats;
• no 2 bedroom lofts;
• sixteen, 3 bedrooms; and
• ten, 3 bedroom duplexes.
The unit mix provided for 87,936 sq. ft. of housing with a density of 19 dwelling units per
acre, the highest density of the three schemes. The main access to the site is via
Chamonix Road. The entry road offered a traditional neighborhood lane, with duplex
units to the north and multi -family units to the south. The lane terminated in the plaza
located in the center courtyard of the multi -story, multi -family structure.
The plaza was of a more urban character, with paving that allowed for pedestrian
1/12/2016
Chamonix Master Plan
and occasional vehicular access as needed. A raised landscaped platform in the
center offered a green gathering spot for residents. A parking structure was located
below the plaza and provided parking for the residents of the multi -storied structure.
The parking structure was accessed via a dedicated entrance off of the frontage
road. As in the previous schemes, open space was provided on the eastern and
western ends of the site, with similar possibilities for programming.
7. RECOMMENDED ACTIONS
A. Amend the Vail Land Use Plan.
• Planning and Environmental Commission recommendation on December 22,
2008
• Vail Town Council adoption, on first reading of Ordinance No. 1, Series of
2009, scheduled for January 6, 2009
B. Rezone the "Chamonix Parcel" to Housing (H) District.
• Occurred on November 18, 2008 (Ordinance No. 26, Series of 2008)
C. Rezone the "Wendy's Site" to General Use (GU) District.
• Occurred on November 18, 2008 (Ordinance No. 27, Series of 2007)
D. Complete the final Chamonix Affordable Housing Development Cost and
Revenue Analysis by Economic & Planning Systems.
• Draft complete on December 9, 2008
E. Complete a site and unit mix specific market study to determine demand for the
development, based on the pre -determined area median income target.
• Initiated Phase II of contract with Economic & Planning Systems on December
16, 2008. Anticipated completion by February 15, 2009.
8. APPENDIX
A. Neighborhood Block Site Plan
B. Chamonix Affordable Housing Development Cost and Revenue Analysis
C. Vicinity Map
12
I I
I I
i1
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" -61
WEST VAL FIRE STATION L
MQ AFFORDABLE HOUSING I r {
`V/i`/J v /�/ if f •� ''1 1 II
ut)l 013,
.7 i 1
NEIGHBORHOOD
--- —'' ' c ��, _ BLOCK
16 dwelling unit per acre
It
9 o SF/ tohlSF/
, ;
J* iR - ftalmafr md�
Y of
pokingspaces spaces
Bre station spaces
26
enclosed a
68
en or tuck under
61
total r of s es
ISS
It unit unita unY udlfype
1 beoYoom 0 768 0
2 bedroom Bad 20 1,242 25,840
2t> < oom loft 16 1,333 21,328
3 bedroom 8 1.460 11,680
du - 3 np 14 1.632 22,848
dud r of ants SY
total sq R 81,696
m
M M M iii♦ iii. iili, i M M 11W/2� M M iii. M
m
M M M iii♦ iii. iili, i M M 11W/2� M M iii. M
Chamonix Master P
Appendix B
CHAMONIX AFFORDABLE HOUSING DEVELOPMENT
COST AND REVENUE ANALYSIS
Prepared for:
Town of Vail
Prepared by:
Economic & Planning Systems, Inc.
December 9, 2008
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Chamonix Master Plan
TABLE OF CONTENTS
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PAGE
I. Introduction.................................................................................................
2
ProjectBackground..........................................................................................
2
Scopeof EPS Analysis........................................................................................
2
ll. Comparative Analysis
................................................................................ 3
ComparativeProjects.......................................................................................
3
III. Feasibility Analysis.....................................................................................
10
ProjectCosts.....................................................................................................
10
ProjectRevenues.............................................................................................
11
CostScenerios..................................................................................................
13
IV. Findings........................................................................................................
0
CostConsiderations..........................................................................................
0
UnitSubsidy.........................................................................................................
1
BuyerLending Issues..........................................................................................
2
Additional Considerations
................................................................................ 2
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LIST OF TABLES
Chamonix Master Plan
PAGE
Table 1
Total Project Costs..........................................................................
11
Table 2
Affordability Calculation................................................................
12
Table 3
Subsidy at Optimal AMI Levels ......................................................
14
Table 4
AMI Levels for Stick Build & Standard Subsidy ............................
15
Table 5
AMI Levels for Modular & Standard Subsidy ...............................
16
Table 6
Incomes Required to Cover Costs of Stick Built Construction .
17
Table 7
Incomes Required to Cover Costs of Modular Construction...
18
Table 8
Summary of Findings.........................................................................
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16
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Chamonix Master Plan
I. INTRODUCTION
The proposed Chamonix affordable housing project site is located on Chamonix Lane in
close proximity to the West Vail interchange. The Town purchased the site several years
ago for the purpose of constructing housing. The former Wendy's site was purchased
more recently for the purpose of constructing a fire station. Collectively, the two sites
total 5.5 acres and are slated for housing and the fire station. Surrounding land uses in
the area consist of highway oriented commercial development. Further north from the
highway along Chamonix Lane, the land use pattern is composed of both single family
and multi family residential uses.
PROJECT BACKGROUND
' The Town of Vail recently retained Stan Clauson Associates, Inc. to complete a site plan
and cost estimation for an affordable housing project on the Chamonix site. As part of
the work, Clauson identified three possible development programs with varying levels of
density and building types. Clauson's work also estimated costs associated with
construction, engineering, and landscaping of the scenarios for both stick built and
modular construction. In addition, the report considered additional costs and fees
associated with achieving LEED certification. The analysis was completed in the fall
of 2008.
From this work, the Town Council identified scheme 1, Neighborhood Block, as the
favored development program. Included in this program are 58 total units with an
overall density of 16 dwelling units per acre. The project cost estimated by Stan Clauson
ranges from $16.7 to $23.3 million depending upon the building construction method. As
part of the evaluation of the project, the Town seeks to develop a full understanding of
any and all costs in addition to land costs that may occur throughout the course of the
project's implementation.
SCOPE OF EPS ANALYSIS
Economic & Planning Systems (EPS) was retained by the Town of Vail to conduct a
feasibility study of the project, building on the work done by Stan Clauson Associates.
First, EPS researched comparable projects within Summit County, the Roaring Fork Valley,
and Eagle County to identify prominent factors influencing the overall economics of a
number of projects. Second, EPS modeled potential Chamonix project revenue based
on targeted AMI levels. Project revenue was then compared to estimated costs,
including additional cost factors identified by EPS, to determine the AMI requirements
needed to provide sufficient revenue to make the project feasible.
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Vies Landing I
The Vic's Landing project is located in the Town of Breckenridge across from the
Breckenridge Golf Course on Tiger Road. The project was spurred by an annexation ,
request by the developer, Tom Silengo, and the corresponding request for water taps.
As part of the annexation, the Town's inclusionary housing requirement was triggered.
The Town required the developer to construct 24 affordable units in exchange for
entitlements for 12 market rate units. Town contribution to the project viability was limited
to fee waivers and the entitlement of the 12 market units.
The project is evenly split between one- and two-bedroom units with target AMI levels of
80 and 100 percent. The 24 -unit project consists of six four-plexes. One -bedroom units are
priced at $185,000 and target income levels at 80 percent of AMI. Two-bedroom units
target both 80 and 100 percent of AMI and are priced at $229,500 and $285,000 per unit.
Among other standards, the deed restriction limits annual appreciation to three percent
or the increase in local AMI, dependant upon whichever measure is higher. In addition,
resales of the units are subject to income testing on the part of the buyer with a 10
percent income level tolerance. I
Closings began in April of 2008. The one -bedroom units in the project are sold out.
Approximately half of the two bedroom units are sold. It should be noted that the two
bedroom units were completed later and thus have been impacted to a greater degree
by current credit restrictions. Federal Housing Administration (FHA) approval of the
project was not originally sought, although an effort on the part of the developer is
currently being made to receive approval. The approval is expected to broaden market
demand as buyer financing will become more available.
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Chamonix Master Plan
II. COMPARATIVE ANALYSIS
'
EPS compiled comparative cost information for seven projects in the Roaring Fork Valley,
Summit County, and Eagle County based on interviews with project representatives. This
'
section discusses the individual projects and then summarizes the relevant findings.
1
COMPARATIVE PROJECTS
,
SUMMIT COUNTY
Vies Landing I
The Vic's Landing project is located in the Town of Breckenridge across from the
Breckenridge Golf Course on Tiger Road. The project was spurred by an annexation ,
request by the developer, Tom Silengo, and the corresponding request for water taps.
As part of the annexation, the Town's inclusionary housing requirement was triggered.
The Town required the developer to construct 24 affordable units in exchange for
entitlements for 12 market rate units. Town contribution to the project viability was limited
to fee waivers and the entitlement of the 12 market units.
The project is evenly split between one- and two-bedroom units with target AMI levels of
80 and 100 percent. The 24 -unit project consists of six four-plexes. One -bedroom units are
priced at $185,000 and target income levels at 80 percent of AMI. Two-bedroom units
target both 80 and 100 percent of AMI and are priced at $229,500 and $285,000 per unit.
Among other standards, the deed restriction limits annual appreciation to three percent
or the increase in local AMI, dependant upon whichever measure is higher. In addition,
resales of the units are subject to income testing on the part of the buyer with a 10
percent income level tolerance. I
Closings began in April of 2008. The one -bedroom units in the project are sold out.
Approximately half of the two bedroom units are sold. It should be noted that the two
bedroom units were completed later and thus have been impacted to a greater degree
by current credit restrictions. Federal Housing Administration (FHA) approval of the
project was not originally sought, although an effort on the part of the developer is
currently being made to receive approval. The approval is expected to broaden market
demand as buyer financing will become more available.
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Chamonix Master Plan
Valley Brook
Valley Brook is a project in the final planning stages also located in the Town of
Breckenridge on northeast corner of Airport Road and Valley Brook Street. The proposed
project is being developed on a fee basis by Mercy Housing Colorado as a result of a
Town issued RFQ in November 2007. As currently proposed, the project includes 42 units
targeting income levels at 80 and 100 percent of AMI.
The project is composed of two- and three-bedroom units in two-story townhomes.
' Approximately 52 percent of the units are targeted for AMI of 80 percent or less and 48
percent of the units are targeted for AMI of 100 percent or less. Units at 80 percent range
in price from $133,000 to $160,000 per unit. Prices at 100 percent range from $200,000 to
1 $250,000. Similar to Vic's Landing, the deed restriction limits annual appreciation to three
percent or the percent by which AMI increases.
I
Hard costs are currently estimated at $184 per square foot with total a total square foot
IJ
cost of $230 per square foot for hard and soft costs as well as site work. The cost
excludes land and off-site costs. Construction prices have increased approximately 10
percent from the time of that the project was initially bid. However, both the developer
and representatives from the Town expect to benefit from a downward renegotiation of
costs. The developer is charging a one-time fee equivalent to approximately four
percent of total costs, although a 10 percent fee is typically used by the developer.
The project is being developed with a high level of subsidy with contributions from town,
state, and federal sources. In total, it is estimated that grant funding will account for $4.7
million of the project's budget, or approximately 38 percent of total costs, which does
not include costs of land (which was contributed to the project by the Town). The
subsidy figure does include fee waivers by the Town. In addition, the Town may also
contribute an additional subsidy in grant funding. At this time, the subsidy per unit is
estimated at $117,000 per unit.
Roaring Fork Valley
Rodeo Place
The Town of Snowmass has recently completed the first homes in Rodeo Place, a 27 -unit
affordable housing development located near the Rodeo Grounds. The project is
' located within the Town of Snowmass, approximately half the distance between the
base area and Highway 82, and is highly visible to traffic along Brush Creek Drive.
The project consists of 20 single family homes, two duplexes, and one triplex. Phase I
accounts for 15 of the 27 total units. The Town finished and closed six units in the fall of
4
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Chamonix Master Plan
2008 and plans to have the balance of Phase I completed by the spring of 2009. The
homes are modular. Town staff noted that there have been problems coordinating the
site work and the manufacturer resulting in project delays and cost increases.
Nevertheless, the Town staff is pleased with the overall process and the quality of the
architectural design.
The Town did not established AMI targets for the prospective residents but relied on
surveys of interested households to derive home prices. Approximately 50 to 60
households with at least one full-time employee based in Snowmass expressed interest in
the project. Most of these households have maintained interest in the project since the
surveys were first distributed in mid 2007. The deed restriction, which limits appreciation
to three percent per year (among other terms), has caused some prospective
purchasers to drop out of the process. However, because housing options are limited
(particularly in Snowmass), most households have maintained their participation
throughout the development process and the pool of buyers has remained sufficiently
large to provide adequate demand.
Based on the response to surveys, homes were designed to fall into a price range
spanning from $300,000 to $550,000 per unit (which translates to an AMI of approximately
140 to more than 250 percent). The small single family homes and duplexes are priced at
$300,000, for 1,400 square feet of finished living area plus 700 square feet of basement
floor area ($214 per square foot, finished). Medium sized single family homes are priced
from $425,000 to $450,000 for 1,800 square feet, plus 900 square feet of basement area
($229 per finished square foot). The largest are priced at $550,000 for 2,150 square feet
plus 950 of basement floor area ($256 per square foot, finished). Basements were not an
optional feature, as the Town mandated that they be included in each home. The
requirement not only ensures adequate storage, but also creates additional bedroom
area to be used for sublets and/or roommates, increasing the number of employees that
can be housed locally.
The construction costs range from $210 to $225 per square foot and covers only vertical
costs. The Town absorbed costs for all on-site infrastructure improvements as well as soft
costs related to the site engineering and architectural design. While staff did not have
specific costs for these services, they estimate a 25 percent increase for these costs
resulting in a total cost of $262 to $281 per square foot. The Town had acquired the land
previously and contributed the cost of the land as a form of subsidy. Subsidies range
from $33,000 to $80,000 per unit based on an average construction cost of $271 per
square foot. The smaller units generate $300,000 of revenue while construction costs total
$380,000 (1,400 * 271), resulting in a net subsidy of $80,000. The medium sized units
required a subsidy of $50,000 and the largest units were subsidized by $33,000. The
average among all three unit types is $54,000.
5
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Chamonix Master Plan
' Burlingame Ranch
Burlingame Ranch is a 21.5 acre affordable housing development in the Town of Aspen
located off Highway 82 to the north of the Bar/X Ranch. The project is entirely dedicated
to affordable housing and planned to be developed over three phases and will include
a total of 236 units. To date, 91 units have been constructed on the site. Income targets
for the project range widely, although the majority of the units accommodate income
' levels that range from approximately 80 to 140 percent of AMI. (Note that the Aspen
Housing Office sets its own median income and corresponding AMI levels. The targets
shown here are approximate.)
The first phase of development includes 15 one bedroom units, 30 two bedroom units, 39
' three bedroom units, and 7 single-family lots. Most of the units are townhomes. In
addition to the identified income limits, residents are also required to earn a minimum of
75 percent of their yearly income within Pitkin County. The units are deed restricted to
I
three percent annual appreciation or the percent by which the Consumer Price Index
(CPI) increases. All 91 units included in the first phase have been sold.
I An extensive audit of Phase I costs in completed Burlingame Ranch was as a result of a
9
brochure that was published in 2005 misstating the total cost of the project to the public.
The average sales price per unit (including lots) for the project was approximately
$230,000. Hard costs for the project averaged $170 per square foot with an average
total cost of $202 per square foot of hard and soft costs (which exclude land, off-site, and
mitigation costs). Including land and all other costs, such an off-site infrastructure,
mitigation, and community benefits, the total project cost $236 per square foot.
The project's audit indicates a per unit subsidy of $331,567, or approximately 59 percent
of the project's costs. This contrasts with an anticipated subsidy of $184,455 per unit. The
increase is largely attributable to programmatic changes made by Council as well as
shifting AMI targets to lower levels. The project costs increased by $11.7 million, resulting
' in relatively high per unit subsidies.
1
F-1
II
Iron Bridge
Iron Bridge is an affordable housing development located in Garfield County between
Carbondale and Glenwood Springs. The affordable component of the project is part of
the larger 300 home development by Iron Bridge Homes, LLC. The inclusion of affordable
units in the development was a requirement of Garfield County's inclusionary housing
ordinance triggered by the developer's request for a Planned Unit Development (PUD)
density increase. A total of 30 deed restricted affordable single family units were
required. County representatives expect 24 to be completed on site and another six to
be addressed via fees -in -lieu.
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Chamonix Master Flan
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Chamonix Master Plan
The affordable units are all comprised of 3 -bedroom 2 -bath units with an average size of
1,430 square feet. The units are targeted to families earning 80 percent or less of AMI
and working in Garfield County. The units are priced at $230,000 as a result of
' calculation of AMI based on a 6 -person family. Garfield County has since amended
their ordinance to limit the amount of people able to be included in the AMI calculation
and maintain lower price points. The units are deed restricted to three percent annual
' appreciation or the percent by which the Consumer Price Index (CPI) increases (among
other requirements).
Sales within the affordable component have been slow, as the developer has closed on
only four units However, the balance of the project is under contract and the remaining
' 20 units are awaiting their certificate of occupancy which has been delayed as a result
of the involvement of Lehman Brothers in the construction loan. As a result, the
completion of the units and release has been delayed several months. No County or
' other public subsidy was used in the construction of the units. Developer representatives
report that their approach was to sell the units at the cost of vertical construction and
shift costs related to land, infrastructure, and soft costs to the market rate portion of the
development. Vertical construction costs are estimated range from $160 to $175 per
square foot. The project is not currently FHA approved, although the developer and
County are investigating the measures necessary to become approved.
i�
J
iEAGLE
COUNTY
Stratton Flats
Stratton Flats is a 47 -acre housing development located in the Town of Gypsum south
i
of Hwy 6 on the northwest side of the Eagle County Regional Airport. The developer for
the project is Meritage Development Group. At build -out the 339 unit project will include
152 single family homes, 118 townhomes, and 69 condominiums of which 226 will include
deed restrictions. At this time, a total of seven units have been permitted on the 47.3
acre site.
' The affordable units target income levels at 140 percent of AMI and are evenly divided
between Town of Gypsum and Eagle County deed restrictions. The Gypsum restriction
i limits income to 140 percent of AMI and requires that buyers earn 85 percent of their
income in Eagle County. The Eagle County deed restriction limits income to 140 percent
of AMI and includes a cap on annual appreciation based on the increase to the local
i AMI.
' Units with the less restrictive Town of Gypsum deed restriction are priced at
approximately $320,000 to $350,000 for townhomes and between $180,000 and $245,000
for condominiums. Units with the Eagle County restriction are priced at $350,000 for
isingle family units, $300,000 to $330,000 units for townhomes, and between $180,000 and
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Chamonix Master Plan
$245,000 for condominiums. Market rate units range from $400,000 to $430,000 for single-
family homes and between $340,000 and $380,000 for townhomes. To date, the
developer has written 8 contracts for units in the project. The developer reported that
approximately 80 people had pursued loans without success. As a result, the developer
has pursued and recently received FHA approval, which allows for 97 percent Loan -to -
Value buyer financing.
The project was completed using modular construction at a total cost of $200 per square
foot. From the time of initially ordering the modular units through the current point in the
construction process, the developer reported a cost increase of eight percent. Within
the Gypsum deed restricted units, there is a per unit subsidy of approximately $23,000
which was provided in the form of fee waivers by the Town. Eagle County units required
higher subsidies of approximately $23,000 of waived Town of Gypsum fees plus $40,000
per unit which was provided through a $4.5 million equity investment in the project by
Eagle County in the form of a subordinated position.
Eagle Ranch Village
Eagle Ranch Village is a land development project by East-West Partners located in the
Town of Eagle off Grand Avenue on Sylvan Lake Road. The project includes
approximately 60 units which were constructed as part of the Town's inclusionary housing
ordinance and were constructed approximately five to six years ago. The affordable
units within the project are housed in four-plexes within the Sylvan Square development,
which is part of a larger development that includes single-family houses, entitled lots, and
additional multifamily housing.
The affordable units sold for approximately $300,000 per unit as compared to market rate
units within the project that sold for approximately $350,000 per unit. Hard costs within
the project were approximately $180 per square foot for vertical construction only. Soft
costs accounted for approximately 20 percent of hard costs resulting in a total cost to
approximately $216 per foot. The developer of the affordable units reported that no
profit margin was received on the affordable units.
No income restrictions exist on the units. The deed restriction requires that residents must
live and work in Eagle County and limits annual appreciation to three percent or CPI,
although this provision is waived if the seller cannot find a buyer. The Eagle County
Housing Authority has the first right of purchase from the owner. The affordable units
were provided a development subsidy through a land donation by East-West Partners as
well as a 0.2 percent transfer fee on the market rate units. The fee is allocated by a
community housing committee to individual units. Including land and the transfer fee,
the total subsidy in Sylvan Square was approximately $50,000 per unit.
9 1
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Chamonix Master Plan
III. FEASIBILITY ANALYSIS
EPS conducted a financial analysis to provide a full indication of the costs the Town of
Vail will incur in the development of the Chamonix site. EPS analyzed potential revenues
from varying AMI levels and projected the per unit subsidies needed to finance the
project.
Project Costs
Town Council has indicated a preference for Scheme 1 of the Stan Clausen proposals
which includes 36 two-bedroom and 22 three-bedroom units for a total of 58 units. EPS
compiled the cost information provided by the consultant with line items for a developer's
fee and contingency consideration. With these factors added to the original estimate,
the total construction cost for the "stick built" Option A is $29,523,540. The cost for the
modular built Option B is $21,844,116, as shown on the following page in Table 1.
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Chamonix Master Plan
Table 1
Total Project Costs
Chamonix Affordable Housing Costs and Revenue Analysis
Sources & Uses
Neighborhood Block
Option A Option B
Total Square Feet
81,696
81,696
Program
$848,328
$848,328
1 Bedroom
0
0
2 Bedroom
36
36
3 Bedroom
22
22
Subtotal
58
58
Costs
Cost Factor
Engineering
$848,328
$848,328
Engineering Services
7.0%
59,383
59,383
Construction
23,283,360
16,747,680
Landscaping
748,552
748,552
LEED Certification
135.420
135,420
Subtotal
$25,075,043
$18,539,363
Cost per Square Foot
$307
$227
Contingency
Engineering Contingency
15.0%
$127,249
$127,249
Construction Contingency'
10.0%
2,328,336
1,674,768
Landscaping Contingency
15.0%
112,283
112,283
Subtotal
$2,567,868
$1,914,300
Fees
LEED Certification Fee
0.5%
125,375
92,697
Developer Fee
7.0%
$1,755,253
$1,297,755
Subtotal
$1,880,628
$1,390,452
Total Costs
$29,523,540
$21,844,116
' EPS additions to Stan Clauson estimate
Source: Economic & Planning Systems, Stan Clauson Associates
».,,.v -w cn..v,:1a—F—ftru,q+e+M+..n--w.can„W—
Project Revenues
EPS estimated appropriate sales prices based upon an Average Median Income (AMI) of
$75,000 for a household of three in Eagle County, as shown in Table 2. Target home
prices range from approximately $228,000 at 80 percent of AMI to $407,300 at 140
percent AMI.
11
Chamonix Master Plan
Table 2
Affordability Calculation
Chamonix Affordable Housing Costs and Revenue Analysis
Description Factor I 80% 90% 100% 110% 120% 130% 140%
Maximum Income
2 Bedroom
3 Bedroom
Housing Payment Capacity
Monthly Payment
Less: Insurance
Less: Property Taxes
Net Available for Debt Service
Affordability Target
Loan Amount
Loan Term
Down Payment
Loan : Value Ratio
Target Affordable House Price
30%
$600 / Year
0.50%
7% interest
Source: HUD; Economic & Planning Systems
H'\18887 -Vail Chant -in, Housing Site Feasibility Analy,s0ata\]18887 -AMI Eagle County As]OwnrAMOrd
$60,320
$67,860
$75,400
$82,940
$90,480
$98,020
$105,560
$60,320
$67,860
$75,400
$82,940
$90,480
$98,020
$105,560
10%
10%
2 8r,
3 Bedroom
10%
10%
10%
$1,508
$1,697
$1,885
$2,074
$2,262
$2,451
$2,639
-$50
-$50
-$50
-$50
-$50
-$50
-$50
-$90
- 100
-$110
-$120
- 130
-$140
- 150
$1,368
$1,547
$1,725
$1,904
$2,082
$2,261
$2,439
$205,600
$232,500
$259,300
$286,100
$312,900
$339,800
$366,600
30 Years
30 Years
30 Years
30 Years
30 Years
30 Years
30 Years
10%
10%
10%
10%
10%
10%
10%
90%
90%
90%
90%
90%
90%
90%
$228,400
$258,300
$288,100
$317,900
$347,700
$377,600
$407,300
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Chamonix Master Plan
COST SCENERIOS
The total amount of revenue available to the project was determined by the number of
units within the project dedicated to each income level. Total income was then
compared to the total project cost to determine the net difference. This amount
provides the basis of the estimate of subsidy per unit for the proposed Chamonix project
in three scenarios. For this analysis, the costs are based on the San Clauson report. Stick
built construction is assumed to cost $285 per square foot and modular is assumed to
cost $205 per square foot.
t
The field research indicates that these may be overly conservative at this time and that a
lower cost figure may be reasonable. In the analysis that follows, the original cost figures '
have been maintained. It is recommended that the feasibility analysis be rerun with
lower figures after the Town has had the opportunity to review them.
11
The first scenario examined an optimal level of affordability with half of the units targeting
households at 80 percent of AMI and half at 100 percent AMI. The second scenario
determines the price points necessary to reach a per unit subsidy consistent with the
comparative projects in the region. The third scenario examines the per unit prices
needed for the project to break even.
'
In the tables that follow, Scenario A refers to stick built construction costs and Scenario B
is based on modular costs.
13
1
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Chamonix Master Plan
OPTIMAL AMI TARGET
An optimal AMI level of 80 and 100 percent of AMI was used in this analysis. At these
levels a stick built project requires a per unit subsidy of approximately $251,000 per unit,
as shown in Table 3. Modular construction at these incomes requires a per unit subsidy
of $118,000.
Table 3
Subsidy at Optimal AMI Levels
Chamonix Affordable Housing Costs and Revenue Analysis
Neighborhood Block
Revenue Sources Option A Option B
2 Bedroom
% of Total
80% AMI - 2 Bdrm.
50%
4,111,200
4,111,200
90% AMI - 2 Bdrm.
0%
0
0
100% AMI - 2 Bdrm.
50%
5,185,800
5,185,800
110% AMI - 2 Bdrm.
0%
0
0
120% AMI - 2 Bdrm.
0%
0
0
130% AMI - 2 Bdrm.
0%
0
0
140% AMI - 2 Bdrm.
0%
0
0
Subtotal
100%
9,297,000
9,297,000
3 Bedroom
80% AMI - 3 Bdrm.
50%
2,512,400
2,512,400
90% AMI - 3 Bdrm.
0%
0
0
100% AMI - 3 Bdrm.
50%
3,169,100
3,169,100
110% AMI - 3 Bdrm.
0%
0
0
120% AMI - 3 Bdrm.
0%
0
0
130% AMI - 3 Bdrm.
0%
0
0
140% AMI - 3 Bdrm.
0%
0
0
Subtotal
100%
5,681,500
5,681,500
Total Revenue
$14,978,500
$14,978,500
Project Profit/Loss
Square Feet
($178.04)
($84.04)
Unit
($250,777)
($118,373)
Total
($14,545,040)
($6,865,616)
Source: Economic & Planning Systems, Stan Clauson Associates
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Chamonix Master Plan
TYPICAL SUBSIDY
Based on the research of regional projects, a representative per unit subsidy for stick built
construction in a project with only affordable units is approximately $120,000 per unit. A
typical subsidy for modular construction is approximately $30,000 per unit.
To reach a typical stick built subsidy, the program required units to be evenly split
between 130 and 140 percent of AMI, as shown in Table 4. At these income levels, the
project could be feasible with a per unit subsidy of approximately $117,000.
Table 4
AMI Levels for Stick Build & Standard Subsidy
Chamonix Affordable Housing Costs and Revenue Analysis
Neighborhood Block
Revenue Sources Option A
2 Bedroom
% of Total
80% AMI - 2 Bdrm.
0%
0
90% AMI - 2 Bdrm.
0%
0
100% AMI - 2 Bdrm.
0%
0
110% AMI - 2 Bdrm.
0%
0
120% AMI - 2 Bdrm.
0%
0
130% AMI - 2 Bdrm.
50%
6,796,800
140% AMI - 2 Bdrm.
500/6
7.331,400
Subtotal
50%
14,128,200
3 Bedroom
80% AMI - 3 Bdrm.
0%
0
90% AMI - 3 Bdrm.
0%
0
100% AMI - 3 Bdrm.
0%
0
110% AMI - 3 Bdrm.
0%
0
120% AMI - 3 Bdrm.
0%
0
130% AMI - 3 Bdrm.
50%
4,153,600
140% AMI - 3 Bdrm.
50%
4.480.300
Subtotal
50%
8,633,900
Total Revenue
$22,762,100
Project Profit/Loss
Square Feet
($82.76)
Unit
($116,577)
Total
($6,761,440)
Source: Economic & Planning Systems, Stan Clauson Associates ,
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Chamonix Master Plan
Modular construction affords a greater flexibility in the program required to reach typical
subsidies. When 50 percent of units are priced for 120 percent AMI and the remaining
units are divided between 110 and 130 percent AMI, a per unit subsidy of approximately
$33,000 is needed, as shown in Table 5.
Table 5
AMI Levels for Modular & Standard Subsidy
Chamonix Affordable Housing Costs and Revenue Analysis
Revenue Sources
Neighborhood Block
Option B
2 Bedroom
% of Total
80% AMI - 2 Bdrm.
0%
0
90% AMI - 2 Bdrm.
0%
0
100% AMI - 2 Bdrm.
0%
0
110% AMI - 2 Bdrm.
30%
3,496,900
120% AMI - 2 Bdrm.
50%
6,258,600
130% AMI - 2 Bdrm.
20%
2,643,200
140% AMI - 2 Bdrm.
211
0
Subtotal
100%
$12,398,700
3 Bedroom
80% AMI - 3 Bdrm.
0%
0
90% AMI - 3 Bdrm.
0%
0
100% AMI - 3 Bdrm.
0%
0
110% AMI - 3 Bdrm.
30%
2,225,300
120% AMI - 3 Bdrm.
50%
3,824,700
130% AMI - 3 Bdrm.
20%
1,510,400
140% AMI - 3 Bdrm.
of
0
Subtotal
100%
$7,560,400
Total Revenue $19,959,100
Project Profit/Loss
Square Feet ($23.07)
Unit ($32,500)
Total ($1,885,016)
Source: Economic 8 Planning Systems, Stan Clauson Associates
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Chamonix Master Plan
MINIMAL SUBSIDY
The following two tables test hypothetical scenarios in which the Town pays the least
amount of subsidy. For stick built construction, the project requires a subsidy of $102,000
per units even if 100 percent of the units are sold at 140 percent of AMI, as shown in Table
6.
Table 6
Incomes Required to Cover Costs of Stick Built Construction
Chamonix Affordable Housing Costs and Revenue Analysis
Revenue Sources
Neighborhood Block
Option A
2 Bedroom
% of Total
80% AMI - 2 Bdrm.
o%
0
90% AMI - 2 Bdrm.
o%
0
100% AMI - 2 Bdrm.
0%
0
110% AMI - 2 Bdrm.
o%
0
120% AMI - 2 Bdrm.
o%
0
130% AMI - 2 Bdrm.
o%
0
140% AMI - 2 Bdrm.
100%
14.662,800
Subtotal
0%
14,662,800
3 Bedroom
80% AN - 3 Bdrm.
o%
0
90% AMI - 3 Bdrm.
0%
0
100% AMI - 3 Bdrm.
o%
0
110% AMI - 3 Bdrm.
o%
0
120% AMI - 3 Bdrm.
o%
0
130% AMI - 3 Bdrm.
0%
0
140% AMI - 3 Bdrm.
l00%
8.960.600
Subtotal
0%
8,960,600
Total Revenue
$23,623,400
Project Profit/Loss
Square Feet
($72.22)
Unit
($101,727)
Total
($5,900,140)
Source: Economic & Planning Systems, Stan Clauson Associates
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17
Chamonix Master Plan
The Town could hypothetically achieve feasibility with minimal subsides using modular
construction costs, as shown in Table 7. The sales modular constructed units are cost
neutral when 40 percent and 50 percent of units are targeted for incomes of 130 and 140
percent of AMI, respectively. At these sales prices a small number of units can be
devoted to 120 percent of AMI.
Table 7
Incomes Required to Cover Costs of Modular Construction
Chamonix Affordable Housing Costs and Revenue Analysis
Revenue Sources
Neighborhood Block
Option B
2 Bedroom
% of Total
80% AMI - 2 Bdrm.
0%
0
90% AMI - 2 Bdrm.
0%
0
100% AMI - 2 Bdrm.
0°i
0
110% AMI - 2 Bdrm.
0%
0
120% AMI - 2 Bdrm.
10%
1,390,800
130% AMI - 2 Bdrm.
50%
6,796,800
140% AMI - 2 Bdrm.
40%
5,702,200
Subtotal
60%
$13,889,800
3 Bedroom
80% AMI - 3 Bdrm.
0%
0
90% AMI - 3 Bdrm.
0°i
0
100% AMI - 3 Bdrm.
0%
0
110% AMI - 3 Bdrm.
0%
0
120% AMI - 3 Bdrm.
10%
695,400
130% AMI - 3 Bdrm.
50%
4,153,600
140% AMI - 3 Bdrm.
40%
3,665,700
Subtotal
60
$8,514,700
Total Revenue
$22,404,500
Project Profit/Loss
Square Feet $6.86
Unit $9,662
Total $560,384
Source: Economic & Planning Systems, Stan Clauson Associates
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Chamonix Master Plan I
IV. FINDINGS
The following analysis summarizes the most prominent issues encountered in the development of
the selected affordable housing projects. Issues are organized by cost considerations, subsidy
levels, and buyer lending.
'
Cost Considerations
Construction costs for the projects under consideration in this report ranged from $200 to $281 per '
square foot, as shown on the following page in Table 8, which summarizes the costs, revenues, and
subsidies for the projects evaluated. The construction cost data shown in the table is exclusive of '
land, off site mitigation, and other considerations. The figures generally include hard costs, soft
costs, and on-site infrastructure. Results indicate frequent instances of construction costs around
$200 to $230 per square foot. 01
Developers experienced cost escalations ranging from 8 to 20 percent from the time an initial bid '
was received to construction. However, project representatives repeatedly indicated that
downward pressure in materials costs has fallen 20 percent from 2007 to 2008. Contractors in the
planning stages are tending to renegotiate prices in light of weakening demand for construction '
materials worldwide.
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t
Chamonix Master Plan
Table 8
Summary of Findings
Chamonix Affordable Housing Costs and Revenue Analysis
Construction Cost
Project Planned Built Target AMI Cost Subsidy 5 Escalation Price Range
(sq. ft.) (per unit)
Summit County
Vic's Landing
24
24
80% to 100%
Mercy Housing
42
---
80% & 100%
Roaring Fork Valley
Rodeo Ground
27
9
140%-250%
Burlingame Ranch
91
91
80% to 140% 2
Iron Bridge
24
24
80% s
Eagle County
Stratton Flats'
226
7
140%
Eagle Ranch Village
60
60
live/work in Cty.
Modular units
Majority of units in this range, AMI level based on survey
Based on six person household
"Total cost derived by allocating 20% of hard costs to soft costs
5 Burlingame Ranch and Mercy Housing figure do not include waived fees
Source: Economic & Planning Systems
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Unit Subsidy
-- fee waivers --- $185,000 - $285,000
$230 $117,000 10% $133,000 - $250,000
$281 $300,000 - $550,000
$202 $332,000 12% avg. $230,000
$202 ° $0 --- $230,000
$200 $23,000 - $40,000 8% $180,000 - $350,000
$216 ° $50,000 20% $300,000
Subsidies take many forms in affordable housing development. The research shows a clustering of
per unit subsidies in the $20,000 to $50,000 range as well as a cluster on the upper end that spans
from $120,000 to $330,000. In all cases, these subsidy levels are on top of land costs. In each of the
case studies provided, land was provided at no cost to the affordable units, which is a minimum
threshold for pursuing an affordable housing project at this time.
Generally, the projects requiring lower subsidies benefit from market rate units that defray the land,
soft costs, developer fees, on-site infrastructure, and off-site mitigation. For example, Iron Bridge,
Stratton Flats, Vic's Landing, and Eagle Ranch Village all received indirect subsidy through the
ability of the developer to build market rate units on-site. In addition, the projects also received fee
waivers to help offset the costs of affordable units. The $23,000 to $40,000 subsidy at Stratton Flats
includes both fee waivers as well as the benefit of a $4.5 million equity contribution from Eagle
County. The $50,000 per unit subsidy at Eagle Ranch Village includes both fee waivers proceeds
from a RETA and the value of a land contribution from the master developer.
Another way to reduce subsidies is to increase sales prices and target higher AMI levels. The
Snowmass project reflects relatively unique approach as virtually all of the units are priced at the
upper end of the affordable spectrum, reaching approximate AMI levels near (or above) 140
percent. The Town was able to reduce the subsidy to $54,000 per unit based on sales prices for
some units that exceeded $500,000. The project with the lowest required subsidy, Stratton Flats,
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Chamonix Master Plan
reflects a combination of benefits, including on-site market rate units, modest deed restriction
terms, as well as higher AMI targets.
In projects without supporting market rate units and conventional AMI targets that reach
households earning as little as 80 percent of AMI, higher subsidies are required to cover project
costs. The proposed Valley Brook project anticipates a per unit subsidy of approximately $117,000.
Burlingame Ranch requires $332,000 per unit.
Moving forward, the Town of Vail should recognize that land subsidy alone will be insufficient for the
project unless construction costs drop and/or AMI targets are set high. The Town should carefully
consider higher AMI levels and should set them only after completing additional market analysis, as
identified below. Generally, the Town should anticipate committing additional levels of subsidy to
the project based on the research of comparative projects.
Buyer Lending Issues
Project developers repeatedly indicated that underwriting standards for residential borrowers
represent the greatest current risk to affordable housing development. Preliminary research shows
that mortgage terms require down payments of 10 to 15 percent. Many developers cited the need
to secure Federal Housing Administration approval, thus providing 97 percent loan -to -value
financing. Project representatives indicated that FHA approval was contingent upon review of the
deed covenants and in the case of the modular development (Stratton Flats) approval of building
plans, including the unit foundation.
Construction loans appear to be less of an issue than individual homebuyer loans. Representatives
from the Valley Brook project indicated a willing market for construction loans. In addition,
downward pressure on construction costs has also eased restrictions to borrowing.
Additional Considerations
Based on discussions with developers with active affordable housing projects in the region, there
are a number of critical issues that warrant consideration, in addition to the issues of costs,
revenues, and feasibility. These include:
■ Competitive Market Position - The Town should understand the market position of the site
relative to other projects within the county. Prospective home purchasers have options and
can be expected to evaluate several other opportunities before selecting a home at this
location. Documenting the market context and determining the competitive advantages
provided by this site will shed light on the profiles of buyers likely to purchase here. The analysis
will enable the Town to price its units based on the market and improve receptivity among the
segment(s) most likely to consider it.
1!
I I
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Chamonix Master Plan
■ Product Alignment - Once the market position and price banding has been established, the
' Town should revisit the products designed for the site. Aligning the products with the buyer
profiles is a critical step to creating a marketable project. It should be noted that most
developers attempt to provide as broad a range of products as possible, thus generating
interest from across the spectrum of prospective buyers. This approach is recommended for the
' Chamonix site as well; however, the Town should identify the most profitable and saleable
product and ensure that the development program is concentrated around this unit type.
' Market Depth by AMI Level - In addition to evaluating the market supply, as noted in the first
two bullets, the Town should consider an analysis of market demand. Using recent survey data,
the Town could understand the depth of potential demand for units by income level. The data
can be cross -tabulated by a range of factors to better understand depth of demand by type
' of resident.
■ Financing Risk Mitigation - The current credit markets are substantially different from the recent
past. Accordingly, developers must take action to ensure that financing is as available under
the most flexible terms possible for future buyers. At this time, developers are seeking FHA
approval to achieve this. The Town should understand the requirements of FHA and ensure that
it is addressed from the start of
1/12/2016
Chamonix Master Plan I
Appendix C
J
El
C
4•
1/12/2016
rowN of va
To: Vail Town Council
From: George Ruther, Director of Community Development
Date: December 17, 2013
Subject: Chamonix Master Plan Information Update
I. Purpose
The purpose of this memorandum is to provide the Vail Town Council with an information update on the
Chamonix Master Plan. Over the past several months Town Council members have asked questions
about the Chamonix Master Plan. In order to effectively convey the information this memorandum will
focus primarily on the Chamonix Master Plan, however a number of other employee housing planning
and policy related documents have been included. If there are any questions staff will schedule a work
session to address them.
II. Chamonix Master Plan
1. Where is the Chamonix Parcel located?
• The Chamonix Parcel is located at 2310 Chamonix Road. Adjacent uses include the Shell Station,
Vail Fire Station No. 3 and a mix of low and medium density residential developments.
2. When did the Town of Vail purchase the Chamonix Parcel?
• The Town of Vail purchased the 3.6 -acre parcel in 2002 for "the purposes of constructing a fire
station, employee housing and land banking."
• In 2007 the Town acquired the adjacent 1.25 -acre Wendy's parcel as it is a more optimal
location, from an emergency services perspective, for the West Vail Fire Station.
3. When was the Chamonix Parcel Land Use Plan adopted?
• The Chamonix Parcel Land Use Plan was adopted in 2005 and it outlined development areas for
a fire station, employee housing and open space.
4. Has the Chamonix Parcel Land Use Plan been amended? If so, what was the reason for the
amendment?
• Yes, the Chamonix Parcel Land Use Plan was amended in 2009 following the purchase of the
former Wendy's Parcel. The result was the Chamonix Master Plan adopted January 2009.
1
1/12/2016
5. What was the objective of the Chamonix Master Plan (2009)?
• The ultimate goal was to provide a plan for the Chamonix Master Plan Area that balanced the
concepts of density, neighborhood impact, and traffic and parking concerns with aesthetics,
sustainability, and value in a way that would address the community need for additional
affordable housing in a contextually appropriate way.
• The Town Council identified eleven development goals to direct the master planning process.
These goals were:
o The site is to be used for development of a fire station and employee housing.
o Housing for student fire department employees should be considered in the design of
the fire station.
o An ambulance substation could be an ancillary use on the site.
o Energy-efficient and sustainable design and construction techniques are important.
Certification by a particular program (Green Globes, LEED) is to be investigated,
although not mandatory.
o 100 percent of housing developed should be deed -restricted, for -sale employee
housing, with a mix of one-, two-, and three-bedroom units.
o The site should be optimized to provide the greatest amount of employee housing.
o Re -zoning the site to Housing (H) District is preferred to allow flexibility in design and
development.
o Additional traffic onto Chamonix Lane should be limited.
o One-story of development along Chamonix Lane is acceptable.
o All financing and phasing options will be considered.
o New pedestrian circulation and access routes should be provided around the site, along
Chamonix Road and/or Lane, to ensure connectivity of the surrounding neighborhood to
other areas within West Vail. Existing pedestrian paths through the site are to be
limited.
6. What role did the community play in the adoption of the master plan?
• During a period of six months the consulting team developed three schemes exploring various
densities and internal character. Development of the schemes benefited from informal and
formal meetings with stakeholders and Town staff and from responses to a survey distributed to
potential residents. Revisions to the three schemes were periodically presented to the Advisory
Committee for additional input and direction, and these refinements were subsequently
presented to the Town Council.
Information from the Town department heads was considered in the site planning and design
guidelines for the development of the employee housing and fire station at the Chamonix
2
1/12/2016
Master Plan Area. Information from other sources was balanced with input from the Focus
Groups.
Vail Town
Council
Consultant Team Advisory Town Staff
Committee
Employee Emergency Town
Neighborhood Infrastructure
Housing Focus Services Focus Department
Group Group Focus Group Focus Group Heads
7. What is the relationship of the Chamonix Master Plan (2009) to the Employee Housing Strategic Plan
(2008)?
• In 2008, the Town of Vail adopted an Employee Housing Strategic Plan. The stated goal of the
strategic plan is "to ensure there is deed restricted housing for at least 30% of Vail's workforce
within the Town of Vail." The strategic plan identifies a series of actions steps the Town should
consider, such as developing deed restricted housing on the Chamonix Parcel, in an effort to
achieve its adopted housing goal.
8. What is the role of the Chamonix Master Plan in the decision-making process?
• Like many of the Town's adopted master planning documents, the role of the Chamonix Master
Plan is to illustrate and articulate the community's expectations and public input, and to guide
decision -makers on how the Chamonix Parcel should be developed.
9. How can the Chamonix Parcel help the Town achieve its goals for deed restricted housing?
• The Town's Employee Housing Strategic Plans identifies Town participation in the development
of new deed -restricted employee housing as a "catch up" opportunity.
• The 2011 Peel/Langenwalter Architects and Martin/Martin Consulting Engineers plan shows up
to 48 units. The plan shows 5 duplexes (10 units) and up to 38 flats.
10. Is the Chamonix Parcel zoned? If so, what is the development potential of the Parcel?
• The upper 3.6- acre portion of the Chamonix Parcel is zoned Housing (H) District and the lower
(former Wendy's parcel) is zoned General Use (GU).
3
1/12/2016
11. Have development scenarios been proposed for the Chamonix Parcel? If so, what were they and
what is the status of the project?
• No development scenarios have been proposed for the Chamonix Parcel since the adoption of
the Chamonix Master Plan. In 2011 the Town Council discussed preliminary plans for an initial
phase of housing development at Chamonix. No further action has been taken.
12. Does the Town of Vail have a policy when it comes to conveying ownership of land underneath
town -sponsored, for -sale housing developments?
• The Town of Vail has retained ownership of the land under all of the deed -restricted,
appreciation -capped units in Town. A 99 -year land lease exists under Vail Commons, North Trail
and the Arosa Duplex.
• The exception is Red Sandstone. There the Homeowner's Association was given the land under
the development because the Town of Vail owned one-third of the land and Eagle River Water &
Sanitation District owned two-thirds of the land.
13. To what degree has the Town studied the marketability and suitability of the Chamonix Parcel for
development?
• The Town completed a market study in 2008 and updated it 2011.
• The Town completed an engineering/utility plan to optimize site utilization and the cost of
constructing the infrastructure in 2011.
14. How have market conditions changed since the adoption of the master plan?
• The Town has a proposal from Economic and Planning Systems to study and update the
Chamonix Market Study to understand how market conditions have changed since the
completion of the Chamonix Market Study as well as the 2011 Chamonix Market Update.
III. Attachments
• Chamonix Master Plan, January 2, 2009
• Resolution No. 2, Series of 2009
• Chamonix Parcel Land Use Plan, August 2, 2005
• Ordinance No. 17, Series of 2005
• Phase 1 & 2 Markup from Martin/Martin Consulting Engineers, 2011
• Chamonix Market Update, February 28, 2011
• Chamonix Market Study, 2008
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1/12/2016
Table 1
Vail Employee Housing Inventory - October 2015
1/12/2016
# Units
Bedroom Mix
Unit Size (Average Square Feet)
Yr. Built
Summary
Avg.
Units
Renter
Owner
Eff
1 BR
2 BR
3 BR
4+ BR
Eff
1 BR
2 BR
3 BR
4+ BR
Employee Housing Units
2001
430
360
70
45
60
357
68
0
395
602
916
1405
0
Owner -Occupied Buy Down Units
1977
2
0
2
0
1
2
0
0
0
662
1180
0
0
Town of Vail Employee Housing
1984
64
62
0
22
38
4
2
0
525
487
825
2070
0
Other Deed Restricted Employer
Assisted Housing
2001
132
132
0
19
58
29
4
28
0
544
729
1200
1300
Zoning Incentive Units
1998
109
109
Totals:
737
663
721
86
159
392
74
28
460
573
912
1552
1300
1/12/2016
TOWN OF VAIN
VAIL TOWN COUNCIL AGENDA MEMO
MEETING DATE: January 12, 2016
ITEM/TOPIC: Adjournment (8:00 p.m.)
1/12/2016