CUED
Center
for Urban Economic Development
University of Illinois at Chicago
Market Feasibility Analysis for the Expansion of New Life Housing Management Company
Project Number: 169
Report Date: February 1983
Author(s): Patricia Wright
In response to a request from Bethel Housing to explore the possibilities of expanding its New Life Housing Management Company, CUED conducted a market feasibility study in the West Garfield and South Austin area. The study was to respond to different issues: difficulties in capturing more of the private rental market, capabilities and size of competing management companies, marketing strategies and a general financial picture for the New Life operation. To answer these questions, CUED conducted a survey of owners of multiple unit buildings and a series of interviews of management companies operating in the area; also general information on the target area was gathered and an expansion plan for New Life was laid out for a three year period.
Based on our findings we concluded that expansion of the New Life Housing Management Company was feasible. A number of the company's policies need to be affirmed, changed or strengthened to make this expansion possible. First of all, New Life needs the continued business of its parent organization. Also, Bethel Housing should continue to expand its own real estate holdings in the area. Secondly, New Life needs to lower its fees in the private rental market to compete with other companies in the area. Thirdly, a strong marketing plan with New Life offering extra benefits to owners and tenants needs to be developed and implemented. In particular, we suggest that New Life set up a revolving loan-fund that owners can borrow from to make repairs. These policies are discussed in more detail in the report's recommendations.
Bethel Housing and its New Life Housing Management Company have as their overall goal, the improvement of living conditions in the West Garfield and South Austin areas. The area is a depressed market hard hit by disinvestment, unemployment and general deterioration. Bethel's major objective in the establishment of New Life is to improve the housing for area residents. Along with its own real estate holdings Bethel plans to influence the private rental market with its New Life operation. This report outlines a realistic approach to the expansion of New Life to manage 97 units of Bethel-owned housing and 213 units of privately-owned units over a three year period.
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