Glossary

Absorption rate—In real estate, the rate or projected rate that a particular use will be completely rented or sold. For example, your UrbanPlan market analysis projects that you can sell 25 to 30 luxury condominium units in one year. That is, the Elmwood District can absorb 25 to 30 luxury condo units per year.

Adequate public facilities—A term often used in discussing a new development to describe whether existing public facilities, such as roads, schools, sewers, and water, are of a size and capacity to serve the new development.

Affordable housing—Non-market-rate housing available only to citizens meeting certain income criteria. Because of the high costs of land and construction in many areas, housing prices are higher than lower-income individuals can afford to pay. Therefore, a public or private source must provide a subsidy to make housing affordable to this population.

Affordable is a relative term that varies according to the actual median income (AMI) of the community in question. Although many think of very-low-income families as the only people eligible for such housing (families making under 60% of AMI), affordable housing may be available to individuals or families making as much as 80% of AMI. In wealthy regions, this often makes many office workers, teachers, firefighters, and police officers eligible for such housing.

For example: If the AMI in a community is $100,000 per year, a family making as much as $80,000 per year could be eligible. A family making $40,000 per year, less than 60% of AMI, would easily meet the criteria. If the AMI in a community is $50,000, a family making as much as $40,000 could be eligible.

Amenities—Those settings or improvements to a property or neighborhood that increase the desirability or enjoyment of the residents, for example, parks, community centers, sports fields. Ame-nities are not necessities.

Asbestos—A mineral formerly used as insulation in buildings that has been linked to lung cancer when inhaled. It must be removed or sealed when demolishing or renovating older buildings to protect construction workers and new inhabitants.

Blight—A condition of property or the uses of property in parts of a city, town, or neighborhood that are detrimental to the physical, social, and/or economic well-being of a community. It can include abandoned buildings or those severely neglected by their owners, vacant lots full of rubble and garbage, or dangerous and/or illegal uses such as crack houses.

Building codes—Government-established construction standards that a building must meet, such as structural requirements, plumbing requirements, and electrical requirements.

Business district—A downtown, a core of business development, or a central business district. Such an area can often mix different land uses, including residential, commercial, and industrial, with certain entertainment functions.

Comprehensive plan—A general community plan that describes land use patterns according to whether a given district or parcel will be devoted to residential, commercial, or industrial use. Such a plan also includes transportation, public facilities, and sometimes social services or redevelopment (urban renewal) plans.

Demand—The quantity of goods that consumers are willing and able to purchase at various prices during a given period of time. Along with supply, demand is one of the two key determinants of price. In real estate, demand refers to the need for a use, such as housing, at a particular price (see Supply).

Demographics—Statistical data usually referring to the number, age, income, and socioeconomic status of a population group. These statistics help government and private businesses anticipate what a community will look like and what its needs will be in the future. For example, knowing the number of families with children who live in or may move to an area helps determine whether new schools must be built.

Density—In real estate, building bigger or taller buildings on a given amount of land increases the project’s density. For example, if your block is 80,000 SF, a 1-story building covering only 20,000 SF of ground is less dense than a 1-story building covering all 80,000 SF. Similarly, a 1-story building covering 20,000 SF is less dense than a 10-story building covering 20,000 SF.

Developer—An entrepreneur who is the leader of the development team. The developer is the inspirational leader of the team, providing the overall vision for the project. The developer also coordinates the purchase of land, design, project planning, financing, and construction of the entire project.

Economic development—A term generally applied to the expansion of a community’s property and sales tax base or the expansion of the number of jobs through office, retail, and industrial development.

Empty nesters—Adults, usually couples, whose children have grown up and left home. Such adults do not want to maintain houses in the suburbs any longer. They are moving to urban areas to enjoy the cultural entertainment and civic activity.

Environmental impact report (EIR)—A study conducted by specialists and generally required by state or federal law to be completed before a project can be built. It evaluates the project’s effect on the environment and infrastructure.

Footprint—In building measurement, the outside dimensions of a building describing the amount of space it occupies on the ground. This figure is usually expressed in square feet of space. A 1-story building measuring 50 feet by 20 feet has a 1,000-SF footprint. A 10-story building of the same dimensions has the same size footprint, even though it is a much larger building.

Growth management—A process by which local governments attempt to minimize the negative effects of rapid development by controlling the timing, location, amount, and density of new commercial buildings, residences, and roads.

Historic preservation—The process of preserving part of a community, from an individual building or part of a building to a whole neighborhood (including roadways and waterways), because of its historical importance.

Infrastructure—Public facilities provided to a site so that it can be developed, including roads, bridges, and utilities such as sewerage and water.

Market economy—An economy in which scarce resources are all (or nearly all) allocated by the interplay of supply and demand in free markets, largely unhampered by government rationing, price fixing, or other coercive interference.

Market forces—The interplay of supply and demand in a market economy that determines what goods or services will be produced.

Market information—Data collected regarding all current conditions—economic, social, and demographic—that affect the potential success of a project.

Market value—The price of a property as determined by buyers and sellers in an open market, that is, a market that is widely accessible to all investors or consumers.

Mixed-income groups—Mixture in a single development of some combination of low-, middle-, and upper-income residents and workers.

Mixed-use development—A form of development that mixes residential, commercial, retail, and other uses in one project.

Mortgage—A loan made for real property—a house or office building, for example—where the property is the security for repayment of the loan or debt.

National Register of Historic Places—An official list of cultural resources worthy of preservation; part of a federal program designed to protect the nation’s historic, architectural, and archaeological assets.

Neighborhood alliance—A local community group often formed to promote the community interest in a specific area.

Nonmarket forces—Actions or regulations of government, outside the demands of the marketplace, that determine or influence what is to be produced. For example, government regulations may require access for handicapped individuals to all buildings as a “public good,” even though not all users of the buildings require such access. Subsidies or mandates for affordable housing are another example of nonmarket forces.

Office—When used as a zoning designation, “office” allows businesses to carry on paperwork rather than manufacturing or production on the site. Businesses such as insurance companies, law firms, and accounting firms work out of offices.

Office building—A place used for the conduct of business or a profession, as distinguished from residential buildings, retail space, industrial buildings, or recreational facilities.

Ordinance—A law or statute enacted by a city or county.

Petition—A declaration signed by individuals and presented to governments as evidence of popular support for an action or position.

Planning commission—A board of a city, county, or similar local government that must approve proposed building projects. Its actions often must be confirmed by a higher board, such as a City Council.

Private sector—The part of an economy in which goods and services are produced and distributed by individuals and organizations that are not part of the government or state bureaucracy.

Property tax—A government levy based on the market value (as assessed by the county assessor’s office) of property, such as real estate.

Property tax base—The collective value of real estate and other assets subject to property tax within a community.

Public sector—The offices and responsibilities of government. In economic terms, the part of an economy in which goods and services are produced and/or (re)distributed by government agencies.

Public works—Facilities run by public agencies to provide water, power, waste disposal, transportation, and similar services to meet common social and economic objectives. Infrastructure is not labeled “public works” unless it is financed, constructed, and/or operated and maintained by the public sector.

Redevelopment—Generally, the redesign or rehabilitation of existing properties and improvement of land in accordance with a city’s goals and objectives.

Retail space—Space in a building for selling merchandise.

RFP (Request for Proposal)—A request from a government or private entity asking developers to submit proposals for ways to develop a property.

Scarcity—A condition that occurs because people’s wants and needs are unlimited, while the resources to produce goods and services to meet those wants and needs are limited.

Shortage—The condition in which the quantity demanded is greater than the quantity supplied at a certain price.

Site analysis—The study of a specific parcel of land (and the surrounding area) to determine its suitability for a specific use.

Supply—The total amount of a good or service available for sale at various prices; along with demand, supply is one of the two key determinants of price (see Demand).

Toxics—Harmful substances located on a property, which may include asbestos, lead, or oil residue. All toxic problems must be taken care of before development can begin. Developers must test for toxic problems before purchasing a piece of land, because cleanup can be time-consuming and very expensive.

Urban redevelopment authority—State or city government entity responsible for promoting revitalization of the city and real estate development in the public interest.

Zoning map—A map that shows the existing use classification for each parcel within a local jurisdiction (see also Zoning ordinance).

Zoning ordinance—A legal document that spells out the requirements for each category of land use. Each use has a specific set of requirements regarding the amount of a site that can be covered with buildings, how far the buildings must be set back from the street, the heights of the buildings, the amount of parking required, and the amount of landscaping or open space required (see also Zoning map).

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