American
Appraisers
Corporation
Appraisers
Corporation
(502) 267-6320 Office
(502) 267-6344 Fax
10801 Electron Drive, Suite 308
Louisville, KY. 40299
(502) 267-6344 Fax
10801 Electron Drive, Suite 308
Louisville, KY. 40299
REGIONAL ANALYSIS OF LOUISVILLE KENTUCKY MSA
The subject is influenced in a general manner by the economic, political, physical and social
characteristics of the Louisville Metropolitan Statistical Area (MSA). A MSA is a geographic area with a
significant population nucleus, along with any adjacent communities that have a high degree of
economic and social integration with that nucleus. Louisville is part of a metropolitan statistical area that
includes Jefferson County, Bullitt County, Oldham County, Trimble County, Meade County, Shelby
County, and Nelson County in Kentucky, and three Indiana Counties including Clark, Harrison and
Floyd.
The value of real property is influenced by the interaction of four basic forces. These forces include
social trends, economic circumstances, environmental conditions, and governmental controls and
regulations. The interaction of these four forces influences the value of every parcel of real estate in
the market.
Social Trends
Social forces are trends that are exerted primarily through population characteristics. Real property
values are affected not only by population changes and characteristics, but also by various forms of
human activity.
Population and Area: Population growth trends influence employment growth, income levels, and
many other key demand parameters analyzed in determining commercial real estate productivity.
As shown, the Louisville MSA comprises nearly 40% of the entire population of Kentucky. Both the
MSA and the state have shown steady growth. Population growth tends to be a positive indicator for
real estate values.
Higher Education: Institutions of higher learning typically are not as vulnerable to economic
downswings, and they help to provide an area with a more solid employment base. Noted universities
and colleges in Metro Louisville are the University of Louisville, Jefferson Community College, the
Sullivan University network, Bellarmine University, Louisville Technical Institute, Louisville Presbyterian
Theological Seminary, Spalding University, Indiana University Southeast, and Indiana Vocational
Technical School.
Recreational and Regional Attractions: Recreational and regional attractions enhance an area’s
quality of life. These activities may also have a significant economic impact on an area by increasing
the demand for services and retail trade created by visitors.
Cultural sites in Metro Louisville include the Louisville Science Center, My Old Kentucky Home State
Park (in nearby Bardstown), Six Flags Kentucky Kingdom Theme Park, The Louisville Slugger Museum,
Slugger Park (home of the Louisville Riverbats minor league baseball team), the Falls of the Ohio
Museum, the Kentucky Center for the Arts, the Louisville Zoo, Freedom Hall, and Churchill Downs,
home of the Kentucky Derby.
Louisville is home to a number of annual cultural events. Perhaps most well-known is the Kentucky
Derby, held annually during the first Saturday of May. The Derby is preceded by a two-week long
Kentucky Derby Festival, which starts with the annual Thunder over Louisville, the largest annual
fireworks display in the nation. In September is the Bluegrass Balloon Festival, the fifth largest hot air
balloon festival in the nation. The suburb of Jeffersontown is also the home of the annual Gaslight
Festival, a series of events spread over a week. The month of October features the St. James Court
Art Show in Old Louisville. Thousands of artists gather on the streets and in the courtyard to exhibit
and sell their wares, and the event is attended by many art collectors and enthusiasts. Another art-
related event that occurs every month is the First Friday Trolley Hop. A TARC trolley takes art lovers to
many downtown area art galleries on the first Friday of every month. The West Main District in
downtown Louisville features what is locally known as "Museum Row". In this area, the Frazier
International History Museum features a collection of arms, armor and related historical artifacts
spanning 1,000 years, concentrating on U.S. and UK arms. Also nearby is the Louisville Science
Center, which is Kentucky's largest hands-on science center and features interactive exhibits, IMAX
films, educational programs and technology networks. The Speed Art Museum is the oldest and largest
art museum in the state of Kentucky. Located adjacent to the University of Louisville, the museum
features over 12,000 pieces of art in its permanent collection and hosts regular temporary exhibitions.
Louisville Metro has 122 city parks covering more than 14,000 acres (57 km²). Several of these parks
were designed by Frederick Law Olmsted, who also designed New York City's Central Park as well as
parks, parkways, college campuses and public facilities in many U.S. locations. The Louisville
Waterfront Park is prominently located on the banks of the Ohio River near downtown, and features
large open areas, which often feature free concerts and other festivals. Cherokee Park features a 2.6-
mile (4.2 km) mixed-use loop and many well-known landscaping features. Other notable parks in the
system include Iroquois Park, Shawnee Park and Central Park.
In development is the City of Parks, a project to create a continuous paved pedestrian and biking trail
around Louisville Metro while also adding a large amount of park land. Current plans call for making
basically the entire 1,600-acre (6 km2) Floyds Fork flood plain in eastern Jefferson County into park
space, expanding area in the Jefferson Memorial Forest, and adding riverfront land and wharfs along
the Riverwalk Trail and Levee Trail.
College sports are very popular in the Louisville area, especially college basketball. The Louisville
Cardinals are currently building a new basketball stadium in downtown Louisville.
Louisville has six professional and semi-professional sports teams. The Louisville Bats are a baseball
team playing in the International League as the Class AAA affiliate of the nearby Cincinnati Reds. The
team plays at Louisville Slugger Field at the edge of the city's downtown.
Downtown Louisville has been undergoing a revitalization project that includes both public and private
investment. Numerous projects include the building of Slugger Field, Riverfront Park, 4th Street Live,
the new construction of the Louisville Cardinals Stadium projected at $250 million, as well as a project
that was just approved to expand 4th Street Live a project budgeted at $450 million.
Overall, the Louisville area has a good mix of cultural and recreational attractions.
Economic Forces
Economic forces are the fundamental relationships between current and anticipated supply and
demand and the economic activities in which the population participates in order to satisfy its wants,
needs, and demands through its purchase power.
The chart below indicates the employment by sector for both the state and the MSA per the US bureau
of labor. As shown the overall employment composition for both the MSA and state are similar and
diverse indicating a stable economic base.
Industries:
The chart below shows the major employers. The major employers are consistent with the sector
employment shown previously.
The chart below only lists the major employers on the private sector. The universities, county schools,
and other government makes up a large portion of the regional employment.
Unemployment:
The following chart shows the historical unemployment rates for the MSA, state, and US from 2000 to
April 2010. As shown, the MSA, state and country all have similar unemployment levels.
Unemployment has risen from 2008 to 2010 for the MSA, state, and nation. Recently Ford Motor
Company has announced that they will be expanding their plant and creating 1,800 new jobs, this will
have a positive impact on the overall unemployment rate in Louisville.
Environmental Forces
Environmental forces are both natural and manmade forces that influence real property values. Some
environmental forces include climactic conditions, natural barriers to future development, primary
transportation systems, and the nature and desirability of the immediate areas surrounding a property.
Highway Transportation: Highway accessibility is a primary consideration in planning an area’s
future growth and development. The Louisville metropolitan area is accessed via three different
interstate highways. I-64 is a major east-west corridor, capable of delivering goods to the East or West
Coasts. St. Louis lies to the west on I-64; West Virginia is accessible to the east. I-65 is a major north-
south corridor, connecting Louisville with Indianapolis, IN and Chicago to the north, and Nashville, TN
and Montgomery, AL to the south. I-71 is a regional interstate highway that connects Louisville with
Cincinnati, OH, as well as I-75, which services not only major points in Ohio but all major points between
Detroit, MI and Florida. Regionally, Indianapolis, Cincinnati, and Nashville are all within a three-hour
drive.
Louisville’s central location in the eastern United States, gives it the claim that over 50% of the
United States Population can be reached within a one day drive. This makes Louisville and ideal
location for distribution.
Louisville's main airport is the centrally located Louisville International Airport, whose IATA Airport Code
(SDF) reflects its former name of Standiford Field. The airport is also home to UPS's Worldport global
air hub. UPS operates its largest package-handling hub at Louisville International Airport and bases its
UPS Airlines division there. Over 3.5 million passengers and over 3 billion pounds (1,400,000 t) of
cargo pass through the airport each year. Louisville International Airport is also the 4th busiest airport
in the United States when in cargo passage, and it is the 11th busiest in cargo passage in the world.
The Ohio River provides an avenue for water transportation, which includes a considerable amount of
barge traffic. The Ohio River connects with the Mississippi River in St. Louis to the west and the
Allegheny River in Pittsburgh, PA to the east.
Public transportation consists mainly of buses run by the Transit Authority of River City (TARC). The
city buses serve all parts of downtown Louisville and Jefferson County, as well as Kentucky suburbs in
Oldham County, Bullitt County, and the Indiana suburbs of Jeffersonville, Clarksville and New Albany.
Louisville is served by two major freight railroads, CSX (with a major classification yard in the southern
part of the metro area) and Norfolk Southern. Five major main lines connect Louisville to the rest of the
region. Two regional railroads, the Paducah and Louisville Railway and the Louisville and Indiana
Railroad, also serve the city.
Climate: The Louisville area enjoys a distinct four-season year. The topography is generally
green, lush, and moderately hilly. Humidity is usually fairly high, even in cold temperatures. Winter
temperatures normally range from mid-teens to mid-40s. Summer temperatures range from 70s to low
90s. Annual precipitation is moderate to heavy in volume and heaviest during late winter and spring
Governmental Forces
Governmental, political and legal actions at all levels have an impact on property values. The legal
climate of a particular time or in a particular place may overshadow the natural market forces of supply
and demand.
Outlook
Our review of the above data indicates that the Louisville MSA has historically enjoyed a relatively
stable economy, evidenced by a historical pattern of increasing income levels, a steady creation of new
jobs, and relatively low unemployment rates. However, recently Louisville, similar to rest of the nation
has experienced setbacks due the national and global recession. Recently Louisville has experienced
increasing foreclosures, increasing unemployment, and other recessionary effects.
In comparison to the surrounding region the Louisville economy is faring better than comparable
markets throughout the Midwest. While Louisville did experience some smaller growth and a less
intense boom prior to the recession that started to take its effects in late 2007 and 2008 through now,
the city did not experience the massive over building other parts of the nation experienced. As such,
the decline has not been as drastic as seen elsewhere.
In conclusion, the economic outlook for the Metro Louisville MSA is favorable in the long term for the
overall success of the subject. In the short term, it is anticipated for longer marketing times and for
some erratic market behavior until the regional economies settle and begin to improve.
SUBJECT MARKET AREA AND ANALYSIS:
Neighborhood is defined as follows: A group of complementary land uses; a congruous grouping of
inhabitants, buildings, or business enterprises.
The subject property is located in East Point Industrial Business Park in eastern Jefferson County. The
Louisville CBD is approximately 8-10 miles west and linkage to the interstate highway system via I-265
is approximately .25 miles east. Major users are large and small office and industrial properties. The
office and industrial properties are predominately less than 25 years old.
The subject’s location provides reasonable real estate taxes, supply of labor, adequate utility service,
beneficial zoning, linkage to the interstate highway system, and close proximity to amenities and
support facilities. The subject’s overall location is considered good.
The popularity of East Point Business Park is due primarily to it’s mixture of industrial, commercial, and
office spaces. Most are occupied by banks, medical entities, restaurants, and day care facilities.
The neighborhood boundaries are generally described as I-265 to the north and east, Old Henry Road
to the south, and Highway 146 to the west.
The major highways in the area are I-64, I-265, and I-264. I-64 is an east-west highway that runs from
Louisville to Lexington. I-265 is Louisville’s outer-belt and I-264 is Louisville’s inner-belt.
The major surface roads in the area are Old Henry Road and Old LaGrange Road. Old Henry Road
provides access to I-265 and on this road is primarily retail & office properties. Off of Old LaGrange
Road is primarily office and industrial development.
The subject is influenced in a general manner by the economic, political, physical and social
characteristics of the Louisville Metropolitan Statistical Area (MSA). A MSA is a geographic area with a
significant population nucleus, along with any adjacent communities that have a high degree of
economic and social integration with that nucleus. Louisville is part of a metropolitan statistical area that
includes Jefferson County, Bullitt County, Oldham County, Trimble County, Meade County, Shelby
County, and Nelson County in Kentucky, and three Indiana Counties including Clark, Harrison and
Floyd.
The value of real property is influenced by the interaction of four basic forces. These forces include
social trends, economic circumstances, environmental conditions, and governmental controls and
regulations. The interaction of these four forces influences the value of every parcel of real estate in
the market.
Social Trends
Social forces are trends that are exerted primarily through population characteristics. Real property
values are affected not only by population changes and characteristics, but also by various forms of
human activity.
Population and Area: Population growth trends influence employment growth, income levels, and
many other key demand parameters analyzed in determining commercial real estate productivity.
As shown, the Louisville MSA comprises nearly 40% of the entire population of Kentucky. Both the
MSA and the state have shown steady growth. Population growth tends to be a positive indicator for
real estate values.
Higher Education: Institutions of higher learning typically are not as vulnerable to economic
downswings, and they help to provide an area with a more solid employment base. Noted universities
and colleges in Metro Louisville are the University of Louisville, Jefferson Community College, the
Sullivan University network, Bellarmine University, Louisville Technical Institute, Louisville Presbyterian
Theological Seminary, Spalding University, Indiana University Southeast, and Indiana Vocational
Technical School.
Recreational and Regional Attractions: Recreational and regional attractions enhance an area’s
quality of life. These activities may also have a significant economic impact on an area by increasing
the demand for services and retail trade created by visitors.
Cultural sites in Metro Louisville include the Louisville Science Center, My Old Kentucky Home State
Park (in nearby Bardstown), Six Flags Kentucky Kingdom Theme Park, The Louisville Slugger Museum,
Slugger Park (home of the Louisville Riverbats minor league baseball team), the Falls of the Ohio
Museum, the Kentucky Center for the Arts, the Louisville Zoo, Freedom Hall, and Churchill Downs,
home of the Kentucky Derby.
Louisville is home to a number of annual cultural events. Perhaps most well-known is the Kentucky
Derby, held annually during the first Saturday of May. The Derby is preceded by a two-week long
Kentucky Derby Festival, which starts with the annual Thunder over Louisville, the largest annual
fireworks display in the nation. In September is the Bluegrass Balloon Festival, the fifth largest hot air
balloon festival in the nation. The suburb of Jeffersontown is also the home of the annual Gaslight
Festival, a series of events spread over a week. The month of October features the St. James Court
Art Show in Old Louisville. Thousands of artists gather on the streets and in the courtyard to exhibit
and sell their wares, and the event is attended by many art collectors and enthusiasts. Another art-
related event that occurs every month is the First Friday Trolley Hop. A TARC trolley takes art lovers to
many downtown area art galleries on the first Friday of every month. The West Main District in
downtown Louisville features what is locally known as "Museum Row". In this area, the Frazier
International History Museum features a collection of arms, armor and related historical artifacts
spanning 1,000 years, concentrating on U.S. and UK arms. Also nearby is the Louisville Science
Center, which is Kentucky's largest hands-on science center and features interactive exhibits, IMAX
films, educational programs and technology networks. The Speed Art Museum is the oldest and largest
art museum in the state of Kentucky. Located adjacent to the University of Louisville, the museum
features over 12,000 pieces of art in its permanent collection and hosts regular temporary exhibitions.
Louisville Metro has 122 city parks covering more than 14,000 acres (57 km²). Several of these parks
were designed by Frederick Law Olmsted, who also designed New York City's Central Park as well as
parks, parkways, college campuses and public facilities in many U.S. locations. The Louisville
Waterfront Park is prominently located on the banks of the Ohio River near downtown, and features
large open areas, which often feature free concerts and other festivals. Cherokee Park features a 2.6-
mile (4.2 km) mixed-use loop and many well-known landscaping features. Other notable parks in the
system include Iroquois Park, Shawnee Park and Central Park.
In development is the City of Parks, a project to create a continuous paved pedestrian and biking trail
around Louisville Metro while also adding a large amount of park land. Current plans call for making
basically the entire 1,600-acre (6 km2) Floyds Fork flood plain in eastern Jefferson County into park
space, expanding area in the Jefferson Memorial Forest, and adding riverfront land and wharfs along
the Riverwalk Trail and Levee Trail.
College sports are very popular in the Louisville area, especially college basketball. The Louisville
Cardinals are currently building a new basketball stadium in downtown Louisville.
Louisville has six professional and semi-professional sports teams. The Louisville Bats are a baseball
team playing in the International League as the Class AAA affiliate of the nearby Cincinnati Reds. The
team plays at Louisville Slugger Field at the edge of the city's downtown.
Downtown Louisville has been undergoing a revitalization project that includes both public and private
investment. Numerous projects include the building of Slugger Field, Riverfront Park, 4th Street Live,
the new construction of the Louisville Cardinals Stadium projected at $250 million, as well as a project
that was just approved to expand 4th Street Live a project budgeted at $450 million.
Overall, the Louisville area has a good mix of cultural and recreational attractions.
Economic Forces
Economic forces are the fundamental relationships between current and anticipated supply and
demand and the economic activities in which the population participates in order to satisfy its wants,
needs, and demands through its purchase power.
The chart below indicates the employment by sector for both the state and the MSA per the US bureau
of labor. As shown the overall employment composition for both the MSA and state are similar and
diverse indicating a stable economic base.
Industries:
The chart below shows the major employers. The major employers are consistent with the sector
employment shown previously.
The chart below only lists the major employers on the private sector. The universities, county schools,
and other government makes up a large portion of the regional employment.
Unemployment:
The following chart shows the historical unemployment rates for the MSA, state, and US from 2000 to
April 2010. As shown, the MSA, state and country all have similar unemployment levels.
Unemployment has risen from 2008 to 2010 for the MSA, state, and nation. Recently Ford Motor
Company has announced that they will be expanding their plant and creating 1,800 new jobs, this will
have a positive impact on the overall unemployment rate in Louisville.
Environmental Forces
Environmental forces are both natural and manmade forces that influence real property values. Some
environmental forces include climactic conditions, natural barriers to future development, primary
transportation systems, and the nature and desirability of the immediate areas surrounding a property.
Highway Transportation: Highway accessibility is a primary consideration in planning an area’s
future growth and development. The Louisville metropolitan area is accessed via three different
interstate highways. I-64 is a major east-west corridor, capable of delivering goods to the East or West
Coasts. St. Louis lies to the west on I-64; West Virginia is accessible to the east. I-65 is a major north-
south corridor, connecting Louisville with Indianapolis, IN and Chicago to the north, and Nashville, TN
and Montgomery, AL to the south. I-71 is a regional interstate highway that connects Louisville with
Cincinnati, OH, as well as I-75, which services not only major points in Ohio but all major points between
Detroit, MI and Florida. Regionally, Indianapolis, Cincinnati, and Nashville are all within a three-hour
drive.
Louisville’s central location in the eastern United States, gives it the claim that over 50% of the
United States Population can be reached within a one day drive. This makes Louisville and ideal
location for distribution.
Louisville's main airport is the centrally located Louisville International Airport, whose IATA Airport Code
(SDF) reflects its former name of Standiford Field. The airport is also home to UPS's Worldport global
air hub. UPS operates its largest package-handling hub at Louisville International Airport and bases its
UPS Airlines division there. Over 3.5 million passengers and over 3 billion pounds (1,400,000 t) of
cargo pass through the airport each year. Louisville International Airport is also the 4th busiest airport
in the United States when in cargo passage, and it is the 11th busiest in cargo passage in the world.
The Ohio River provides an avenue for water transportation, which includes a considerable amount of
barge traffic. The Ohio River connects with the Mississippi River in St. Louis to the west and the
Allegheny River in Pittsburgh, PA to the east.
Public transportation consists mainly of buses run by the Transit Authority of River City (TARC). The
city buses serve all parts of downtown Louisville and Jefferson County, as well as Kentucky suburbs in
Oldham County, Bullitt County, and the Indiana suburbs of Jeffersonville, Clarksville and New Albany.
Louisville is served by two major freight railroads, CSX (with a major classification yard in the southern
part of the metro area) and Norfolk Southern. Five major main lines connect Louisville to the rest of the
region. Two regional railroads, the Paducah and Louisville Railway and the Louisville and Indiana
Railroad, also serve the city.
Climate: The Louisville area enjoys a distinct four-season year. The topography is generally
green, lush, and moderately hilly. Humidity is usually fairly high, even in cold temperatures. Winter
temperatures normally range from mid-teens to mid-40s. Summer temperatures range from 70s to low
90s. Annual precipitation is moderate to heavy in volume and heaviest during late winter and spring
Governmental Forces
Governmental, political and legal actions at all levels have an impact on property values. The legal
climate of a particular time or in a particular place may overshadow the natural market forces of supply
and demand.
Outlook
Our review of the above data indicates that the Louisville MSA has historically enjoyed a relatively
stable economy, evidenced by a historical pattern of increasing income levels, a steady creation of new
jobs, and relatively low unemployment rates. However, recently Louisville, similar to rest of the nation
has experienced setbacks due the national and global recession. Recently Louisville has experienced
increasing foreclosures, increasing unemployment, and other recessionary effects.
In comparison to the surrounding region the Louisville economy is faring better than comparable
markets throughout the Midwest. While Louisville did experience some smaller growth and a less
intense boom prior to the recession that started to take its effects in late 2007 and 2008 through now,
the city did not experience the massive over building other parts of the nation experienced. As such,
the decline has not been as drastic as seen elsewhere.
In conclusion, the economic outlook for the Metro Louisville MSA is favorable in the long term for the
overall success of the subject. In the short term, it is anticipated for longer marketing times and for
some erratic market behavior until the regional economies settle and begin to improve.
SUBJECT MARKET AREA AND ANALYSIS:
Neighborhood is defined as follows: A group of complementary land uses; a congruous grouping of
inhabitants, buildings, or business enterprises.
The subject property is located in East Point Industrial Business Park in eastern Jefferson County. The
Louisville CBD is approximately 8-10 miles west and linkage to the interstate highway system via I-265
is approximately .25 miles east. Major users are large and small office and industrial properties. The
office and industrial properties are predominately less than 25 years old.
The subject’s location provides reasonable real estate taxes, supply of labor, adequate utility service,
beneficial zoning, linkage to the interstate highway system, and close proximity to amenities and
support facilities. The subject’s overall location is considered good.
The popularity of East Point Business Park is due primarily to it’s mixture of industrial, commercial, and
office spaces. Most are occupied by banks, medical entities, restaurants, and day care facilities.
The neighborhood boundaries are generally described as I-265 to the north and east, Old Henry Road
to the south, and Highway 146 to the west.
The major highways in the area are I-64, I-265, and I-264. I-64 is an east-west highway that runs from
Louisville to Lexington. I-265 is Louisville’s outer-belt and I-264 is Louisville’s inner-belt.
The major surface roads in the area are Old Henry Road and Old LaGrange Road. Old Henry Road
provides access to I-265 and on this road is primarily retail & office properties. Off of Old LaGrange
Road is primarily office and industrial development.
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__Appraisers
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10507 Watterson Tr., 2nd Flr
Louisville, KY. 40299
Louisville, KY. 40299
Page updated December 20, 2011