KNOW THY
MARKET
The Role of Research in a
Matter of Ho Compliant
Business Plan.
by Marisa Marconi
Mixed-Use Real Estate Developments
Mixed use real estate developments include office and retail lease space in addition to residential units for lease
or sale. The market analysis summary for these projects
should address both the residential component (including
“A ‘Matter of Ho
the aforementioned data points) as well as the commercial
Compliant Business Plan’
component. Key market data and research includes:
is common parlance in
• Average price per square foot for other available space
the EB-5 industry now.”
for lease in the area.
• Notable retail anchors or points of interest in the immediate area.
• Growth trends of the neighborhood or immediate
area. For example, an urban neighborhood
with explosive growth in new residential
development would be a prime market
for new retail lease space.
M
ost investors, developers, and regional centers un-
tomer base contribute to the company’s potential. The
derstand that a simple project description or gener-
research and data included in the plan must be tailored
ic business plan won’t pass muster with U.S. Citizenship
to the business type and industry to be relevant. For ex-
Hotels can range from small three-
and Immigration Services and an in-depth document is
ample, data about the local population does not provide
star hotels in suburban towns or tran-
required for project/petition approval.
much context for the market potential of a hotel that ca-
sit hubs to five-star hotels in the heart
ters to visitors from out of town. Moreover, the market
of some of America’s biggest cities. -Re-
Hotels
What makes a plan compliant is a topic that has been ex-
analysis section should be more than just data—the busi-
gardless, data related to tourism and traveler
plored by myself as well as many other authors featured in
ness plan should create a narrative using data to paint a
trends and the performance of similarly rated hotels
this publication. But a key element that is sometimes more
picture of the market, the project or company’s place in
in the immediate area add credibility to the hotel’s project-
difficult to define is that the plan must be credible. In sim-
the market, and its potential.
ed performance. Key data includes:
ple terms, the credibility of the plan is related to whether
A summary of important data by industry and project type
• Average daily rates (ADR) and occupancy rates of other
the claims made in the plan are believable. The purpose
for some of the most common EB-5 project types follows:
hotels in the market within the same service level.
of the business plan is to provide context and justification
• Historical and projected growth of ADR, occupancy
for job creation. In regional center projects that count op-
Residential Real Estate Developments
rates, and RevPar.
erations’ jobs, or direct EB-5 investment projects where
Residential real estate projects consist of the construc-
• Tourism trends for the local market.
the company directly creates jobs, total revenue is the key
tion and subsequent sale or leasing of residential units
• Notable points of interest in the nearby vicinity of the
indicator and metric used to determine job creation. Rev-
or properties. Demand for new units is dependent on the
property.
enue, of course, is driven by the capacity of a business
growth of the real estate market and existing supply. Key
to provide services or products, but also the demand for
market data for these types of projects include:
Restaurants
those products and services in the market. Therefore, the
• Recent sales price per square foot for real estate in the
While the recipe for a restaurant’s success includes an ap-
credibility of a business plan (and the revenue projections
immediate market (in the case of units slated for sale).
pealing menu, good management, and effective brand-
and staffing projections included) is rooted in the research
• Rental growth, rental rates, and vacancy trends (in the
ing, the chosen location and characteristics of the market
presented in its market and industry analysis.
case of units slated for lease).
surrounding it are just as much a driver for success. Market
• Population demographics, household incomes, and pro-
analysis for restaurants should include:
jected growth.
• Demographics for the population within a one-, three-
The market analysis section of the business plan iden-
• Competitive properties under development and associ-
and five-mile radius.
tifies the target market of the company’s products or
ated rental or sales rates.
• Consumer spending patterns related to dining out.
services and provides details related to supply and de-
• Notable benefits of the location, or key economic drivers
• Projected growth in population and consumer spending.
mand. The aim is to quantify and describe the primary
in the area, including large employers, shopping centers,
• Competitors’ performance.
customer base and how the characteristics of that cus-
and areas of interest.
• Applicable restaurant trends.
Market Analysis in Business Plans
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