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Opportunity in the Inner City; Social Compact Releases Compelling DRILLDOWN Results for Oakland

Opportunity in the Inner City; Social Compact Releases Compelling DRILLDOWN Results for Oakland

Published 08-22-05

Submitted by PMI Group, Inc.

WALNUT CREEK, Calif.--(BUSINESS WIRE)--Aug. 22, 2005--Driven by a $400-million-plus informal economy, four Oakland neighborhoods are primed for capital investment and business development, according to research results released today by Social Compact.

The Social Compact DRILLDOWN methodology reveals the hidden strengths of traditionally undervalued communities. Private market analysis models are adapted to the unique geography and demography of inner city neighborhoods to identify hidden populations, economies, and micro-market opportunities that traditional market information sources ignore. "Many people don't know how to read the market potential of inner-city neighborhoods, because traditional data sources don't pick up on their strengths," explained Karin Ottesen, chief executive of Social Compact. "When we examined the neighborhoods of East and West Oakland, Fruitvale, and Lower San Antonio, we found significant signs of market growth and strength."

Social Compact shared the research findings today with city officials, community groups, and corporate leaders from across the country at a presentation at the Fruitvale Transit Village, followed by a bus tour of the four neighborhoods studied.

Highlights of the research findings were:

Market size

  • With 165,178 residents, the four neighborhoods studied
    exceed 2004 census trend projections (by 10,771
    residents). That translates into 16 people for every 15
    projected.

    Buying power:

  • Aggregate income for the four neighborhoods combined is
    over $2.6 billion, more than $400 million higher than 2004
    census trend projections.

  • Over $1 billion in total estimated retail purchases in
    2004.

  • Informal economy is huge, worth over $130 million in East
    Oakland, $129 million in Fruitvale, $110 million in Lower
    San Antonio, and $62 million in West Oakland

  • In Fruitvale, the DRILLDOWN uncovered over $90 million in
    household income that was not captured in 2004 census
    trend projections

  • Median home sale value in Lower San Antonio exceeds 2004
    census trend projections by 58%.

    Stable, safer markets

  • Owner-occupancy at the building level, an indicator of
    neighborhood stability, is high in all four neighborhoods:
    East Oakland nearly 75%; Fruitvale 66%; Lower San Antonio
    55%; West Oakland 49%.

  • In West Oakland, property crime dropped 16.4% from 2000 to
    2004.

    Complete results of the Oakland DRILLDOWN are available at:www.socialsocialcompact.org.

    "Social Compact's DRILLDOWN results challenge our perceptions by uncovering the hidden strengths in neighborhoods like East and West Oakland, Fruitvale, and Lower San Antonio," said Roger Haughton, CEO of The PMI Group, Inc., which along with Affinity Bank spearheaded the effort to bring Social Compact's DRILLDOWN to Oakland. "By generating a flow of capital that sparks business investment and creates jobs, Social Compact's research strengthens underserved communities. PMI is committed to providing the affordable housing that families in these neighborhoods need."

    Piloted in Chicago in 1998, the DRILLDOWN challenges the negative stereotypes that have traditionally defined many inner-city neighborhoods. Social Compact compiles its data from four tiers of information: a core demographic profile, proprietary corporate experience in the target markets, under-the-radar data on the cash economy and hidden populations, and a micro-market analysis of household strength. Through its research and analysis, Social Compact's ultimate goal is to fuel the long-term competitive strength of lower-income communities by attracting capital. Social Compact has delivered its DRILLDOWN to communities in Chicago, New York, Washington D.C., Houston, Jacksonville, and Cleveland.

    Sponsors of the Oakland DRILLDOWN include Affinity Bank, Annie E.
    Casey Foundation, First American Real Estate Information Services, Federal Home Loan Bank of San Francisco, Federal Home Loan Bank System, Evelyn and Walter Haas, Jr. Fund, NeighborWorks(R) America/Neighborhood Reinvestment Corporation, The PMI Foundation, Union Bank, US Bancorp and Washington Mutual.

    About Social Compact

    Social Compact is a coalition of business leaders from across the country who are promoting successful business investment in inner-city and rural communities. For twelve years, Social Compact has sponsored the highly competitive and prestigious Social Compact Awards that recognize successful business performance and investment in America's underserved neighborhoods. Social Compact is now further leveraging its leadership's combined business expertise to address some of the key impediments to private investment in inner-city communities, namely, negative stereotypes -- reinforced by poverty and deficiency data coupled with lack of dependable business-oriented market information -- and an absence of effective inner-city market analysis models.

    About The PMI Group, Inc.

    The PMI Group, Inc. (NYSE:PMI), headquartered in Walnut Creek, CA, is an international provider of credit enhancement products that promote homeownership and facilitate mortgage transactions in the capital markets. Through its wholly owned subsidiaries and unconsolidated strategic investments, the company offers residential mortgage insurance and credit enhancement products domestically and internationally, financial guaranty insurance, and financial guaranty reinsurance. Through its subsidiaries, The PMI Group, Inc. is one of the world's largest providers of private mortgage insurance with operations in the United States, Australia, New Zealand, and the European Union, as well as one of the largest providers of mortgage guaranty reinsurance in Hong Kong. For more information: pmigroup.com.

    Copyright Business Wire 2005

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    For more than 30 years, PMI has combined its risk management expertise and financial strength to serve the evolving needs of our customers and the world’s financial markets. PMI's insurance products support the mortgage finance system by providing protection to lenders and investors around the globe in the event of borrower default. By protecting mortgage lenders and investors from credit losses, PMI helps to ensure mortgages are available to prospective homebuyers. Through its strategic investments in the financial guaranty industry, PMI supports the infrastructure on which homeownership depends, including transportation, schools, hospitals, and utilities.

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