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INTRODUCTION <br /> PURPOSE <br /> This study examines the market issues concerning the proposed development of a gasoline and <br /> convenience market at the corner of Silver Lake Road and Highway 10 in Mounds View. The market <br /> issues include the value of a gas and convenience store within the commercial real estate market (does <br /> the proposed development use the competitive advantages of the site), and the market saturation issues <br /> of adding another gasoline supplier on Highway 10 in Mounds View. <br /> METHODOLOGY <br /> This study examines the question of market saturation from two perspectives. First, the market area was <br /> divided into two segment; household demand within a 1.5-mile radius of the proposed development, and <br /> non-local through traffic on Highway 10. The study then examined the market saturation of these <br /> combined market segments. This study uses the following set of assumptions to estimate the size and <br /> saturation of the household gasoline market. <br /> Number of Households 9,274 households <br /> Average Vehicles per Household 1.95 vehicles per household <br /> Annual Miles Per Vehicle 11,839 miles <br /> Typical Fuel Efficiency 21.48 miles/gallon <br /> Average Cost per Gallon $1.20 per gallon <br /> 1994 National Average Gas Station Sales 1.15 million gallons <br /> Through traffic on Highway 10 was estimated by examining vehicle counts along a six-mile stretch of <br /> Highway 10, and vehicle counts at major intersections along the household market area. Total traffic <br /> along Highway 10 is approximately 40,000 vehicles per day. Through traffic accounts for approximately <br /> 28,500 vehicles per day. <br /> Second, the study examined the gasoline market comprised primarily of the traffic along Highway 10 and <br /> Silver Lake Road. Applying the following national and state averages for typical gasoline sales, this <br /> study estimates the size of the regional gasoline market and degree of supply saturation along Highway <br /> 10 surrounding the proposed development. <br /> Typical Absolute Market Share 1% capture of daily vehicles <br /> 1995 Avg. Minnesota Gas Station Sales $1.3 million (gas and convenience items) <br /> 1994 National Average Gas Station Sales 1.15 million gallons <br /> -1- <br />