When I create a
Visual Studio Community 2015 Community
A problem was encountered creating the sub project 'App1.WinPhone'. This project requires a Visual Studio update to load. Right-click on the project and choose 'Download Update'
Uninstall Xamarin completely, and reinstall it. That happened to me as well. I would uninstall Visual studio too. Install that first, then install Xamarin.
Edit: I know this sucks to do, but it was what the Xamarin team had me do to resolve it. As far as I know this is the official fix as of last week.