The questions in this homework are based on data that I would like you to get from the 3 websites: (1)
Simon Property (www.simon.com), (2) Group US Census Bureau (www.census.gov), and (3) Bureau of
Labor Statistics (www.bls.gov).
For each question, show in your write up all numbers you are working with, and explain all relevant
calculations. Be sure to show the data that were downloaded in your Excel sheet, so I can verify your
numbers, and upload the Excel document to Blackboard along with the write up portion.
Problem #1 (15 points)
Simon Property Group (www.simon.com) is one of the largest real estate companies in the world and
owns hundreds of shopping centers in the U.S. as well as overseas.
(a) Pick one of their shopping centers in California. On the website, find and summarize in your
write-up information for:
- Mall type
- GLA
- Main anchors
- Size of, and information on, trade-area resident population
- Size of, and information on, trade-area non-resident population
- Main competitors in the trade area that the website provides
(b) Using “Reilly’s Law of Retail Gravitation” calculate the break-point distance for your shopping
center in part (a) relative to the nearest Simon Property Group shopping center. Use GLA sizes
for “populations” in the formula. What does the result tell you? Explain.
Problem #2 (15 points)
A real estate investment company in Southern California is applying for a construction loan for a
proposed new gated community with 250 single-family detached houses. If the loan is approved, it can
start the construction as early as next week and have all houses completed and available for sale in
- The company’s research department recently performed a market study and identified Orange
County, CA to be the main trade area that will draw the majority of households interested in buying
the houses.
For both parts (a) and (b), provide an excel worksheet that shows and explains your calculations, and
show the numbers you plugged in to do your calculations.
For the source of data, go to the US Census website, on the main page scroll all the way down and click
on the Explore Data tab, select Data Tools and Apps, select American FactFinder, then go to
Community Facts (Enter Community Name) or Advanced Search, and select your search criteria.
(a) What does the company’s research team project for the total number of households in 2018 &
2019? The team used the regression forecasting technique (This calculation should be done by
hand. Do not use the Excel Add-in feature). It obtained information on the historical numbers
of households in Orange County, CA for recent three years, 2015, 2016, 2017, from the US
Census Bureau website, 1-year estimates, based on the American Community Survey (ACS).
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(b) What is the required capture rate for this project, assuming the demand for new housing comes
only from the increase in the number of households in the trade area?
Problem #3 (15 points)
For Los Angeles metropolitan statistical area calculate the Actual Sales Index for personal care products
and services based on the most recent available data. For the data use the US Census’ FactFinder
“Advanced Search”, select the right geographies and the right NAICS retail category. In addition, for the
same year, for the same geography, calculate the Spending Potential Index for personal care products
and services. For the data, go to the Bureau of Labor Statistics website, in the search line type
“Consumer Expenditure Survey” (CEX). On the new page, on the left under “CE Geographic Data” you
can then select the right geography.
Do your results suggest “leakage” or “inflow” of consumer spending in Los Angeles MSA? Explain. How
can this finding be used in real estate market studies
Sample Solution