BASE ZONING ALTERNATIVE 84, , , ,734 3,000 15,000 33,239 15,000. See Residual Land Value $61,685,000 13,222,000 13,954,000

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Godwin Barber
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Club Restaurant Retail Design Showroom Parking Required Parking Spaces Number of Subterranean Parking Levels 84,506 4 45 119,973 119,973 1.

1 SUMMARY TABLE DEVELOPMENT ALTERNATIVES ECONOMIC VALUATION TOOL I. Program Summary Site Area (SF) Building Height Number of Floors Number of Feet Gross Building Area (SF) Total Subject to FAR Calculations Floor Area Ratio (FAR) Net Leasable Area (SF) Hotel Spa/Gym Club Restaurant Retail Design Showroom Parking Required Parking Spaces Number of Subterranean Parking Levels 84, , , ,734 3, ,000 33,239 15, , , , ,348 1,052 2,462 18,730 23,267 10, Construction Costs Land Costs Hard Costs Soft Costs Financing Costs Total Construction Costs Per SF GBA See Residual Land Value $61,685,000 13,222,000 13,954,000 $88,861,000 $741 See Residual Land Value $134,604,000 29,255,000 32,319,000 $196,178,000 $692 N~t O(!erating Income Hotel Commercial Parking Total Net Operating Income $3,463,000 3,589,000 1,694,000 $8,746,000 $11,889,000 3,550,000 3,712,000 $19,151,000 Project Com(!onent Values Total Net Operating Income Weighted Cap Rate Total Project Value $8,746, % $127,067,000 $19,151, % $259,179,000 V. Residual Land Value Estimate Total Project Value (Less) Developer Profit (Less) Total Construction Costs Residual Land Value Per SF of Land Area $127,067,000 (15,248,000) (88,861,000) $22,958,000 $272 $259,179,000 (31,101,000) (196,178,000) $31,900,000 $377 VI. Estimated Value Creation Difference in Residual Land Value Per SF of Land Area $8,942,000 $106 File name: Robertson Lane Mixed Use_S 2118; Summary; trb ATTACHMENT N

2 APPENDIX A SUPPORTABLE LAND VALUE Filename: Robertson Lane Mixed Use_S 2118; Base Zoning PF; trb

Spaces $40,000 /Space Level4 0 Spaces $45,000 /Space New Construction Building Costs Hotel 100 Rooms $160,000 /Room Spa/Gym 3,000 Sf Spa/Gym GBA $185 /Sf Spa/Gym GBA Restaurant 15,000 Sf Restaurant

3 APPENDIX A- TABLE 1 TOTAL CONSTRUCTION COSTS I. Hard Costs Site Costs 84,506 Sf Land $20 /Sf Land Demolition Costs 84,506 Sf Land $15 /Sf Land Subterranean Parking Costs Level Spaces $30,000 /Space Level2 223 Spaces $35,000 /Space Level 3 0 Spaces $40,000 /Space Level4 0 Spaces $45,000 /Space New Construction Building Costs Hotel 100 Rooms $160,000 /Room Spa/Gym 3,000 Sf Spa/Gym GBA $185 /Sf Spa/Gym GBA Restaurant 15,000 Sf Restaurant GBA $185 /Sf Restaurant GBA Retail 33,239 Sf Retail GBA $185 /Sf Retail GBA Design Showroom 15,000 Sf Showroom GBA $185 /Sf Showroom GBA Hotel FF&E / Commercial Tl Allowance Hotel 100 Rooms $35,000 /Room Spa/Gym 3,000 Sf Spa/Gym GBA $35 /Sf Spa/Gym DLA Restaurant 15,000 Sf Restaurant GBA $50 /Sf Restaurant GLA Retail 33,239 Sf Retail GBA $30 /Retail GLA Design Showroom 15,000 Sf Showroom GBA $25 /Sf Showroom GLA Contractor Costs 20% Other Direct Costs $1,690,000 1,268,000 6,660,000 7,805, ,000, ,000 2,775,000 6,149,000 2,775,000 3,500, , , , ,000 10,281,000 Total Hard Costs 119,973 Sf GBA $S14 /Sf GBA $61,685,000 Soft Costs Arch, Eng & Consulting Costs 8% Direct Costs Public Permits & Fees 119,973 Sf GBA $20.00 /Sf GBA Taxes, Ins, Legal & Acctg Costs 3% Direct Costs Marketing & Leasing Costs 63,239 Sf Commercial GBA $3.00 /Sf Comm. GBA Hotel Pre-Opening/ Wkg Capital 100 Rooms $7,500 /Room Development Management Fee Indirect Cost Cont. Allowance 4% Direct Costs 5% Other Indirect Costs $4,935,000 2,399,000 1,851, , ,000 2,467, ,000 Total Soft Costs $13,222,000 Financing Costs Land Carrying Costs $22,957,000 Loan Amount 6.50% Interest Interest During Construction $88,861,000 Loan Amount 5.50% Interest Loan Origination Fees Construction Loan $88,861,000 Loan Amount 2.50 Points Permanent Loan 5 $76,240,000 Loan Amount 2.50 Points $2,984,000 6,842,000 2,222,000 1,906,000 Total Financing Costs $13,954,000!Total Construction Costs 119,973 Sf GBA $741 /Sf GBA sss,s61,ooo I The direct costs assume that prevailing wage requirements will not be imposed on the Project. Includes contractors' fees, general requirements, builder's risk insurance, and a direct cost contingency allowance. Based on a 24-month development period with a 100% average outstanding balance. Assumes an 18-month construction period with a 60% average outstanding balance, and a 6-month absorption period with a 100% average outstanding balance. Based on a 6.88% weighted average capitalization rate and a 60% loan-to-value ratio. Prepared by: Keyser Marston Associate s, Inc. Filename: Robertson Lane Mixed Use_5 2118; Base Zoning PF; trb

APPENDIX A- TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME Hotel Component I. Hotel Income Room Sales Revenues $315 /Room 100 Rooms $9,198,000 Food & Beverage 20.

0% Department Sales $23,000 /Room $2,300,000 Food & Beverage 70.0% Department Sales $17,200 /Room 1,717,000 Other 30.

4 APPENDIX A- TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME Hotel Component I. Hotel Income Room Sales Revenues $315 /Room 100 Rooms $9,198,000 Food & Beverage 20.0% Gross Sales $24,500 /Room 2,453,000 Other 5.0% Gross Sales $6,100 /Room 613,000 Gross Sales $12,264,000 " Distributed Expenses Rooms 25.0% Department Sales $23,000 /Room $2,300,000 Food & Beverage 70.0% Department Sales $17,200 /Room 1,717,000 Other 30.0% Department Sales $1,800 /Room 184,000 Total Distributed Expenses $4,201,000 Undistributed Expenses General & Administration 10.0% Gross Sales $12,300 /Room $1,226,000 Marketing 7.0% Gross Sales $8,600 /Room 858,000 Utilities 3.0% Gross Sales $3,700 /Room 368,000 Maintenance & Operations 5.0% Gross Sales $6,100 /Room 613,000 Total Undistributed Expenses $3,065,000 Management Fees 3.0% Gross Sales $3,700 /Room $368,000 v. Fixed Expenses Property Taxes 1.1% Value $4,915 /Room $492,000 Insurance 1.5% Gross Sales $1,800 /Room 184,000 FF&E Replacement Reserves 4.0% Gross Sales $4,900 /Room 491,000 Total Fixed Expenses $1,167,000 VI. Hotel Net Operating Income 28% Gross Sales $3,463,000 Assumes an 80% average occupancy rate. Filename: Robertson Lane Mixed Use_S 2118; Base Zoning PF; trb

APPENDIX A TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME I. Commercial Income Restaurant Retail Design Showroom CAM Reimbursements Commercial Component 15,000 Sf Restaurant GLA $70.

00 /Sf/Year $1,050,000 2,327,000 900,000 949,000 Gross Commercial Income (Less) Vacancy Allowance 10.

5 APPENDIX A TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME I. Commercial Income Restaurant Retail Design Showroom CAM Reimbursements Commercial Component 15,000 Sf Restaurant GLA $70.00 /Sf/Year 33,239 Sf Retail GLA $70.00 /Sf/Year 15,000 Sf Showroom GLA $60.00 /Sf/Year 63,239 Sf Commercial GBA $15.00 /Sf/Year $1,050,000 2,327, , ,000 Gross Commercial Income (Less) Vacancy Allowance 10.0% Gross Commercial Income $5,226,000 (523,000) Effective Gross Commercial Income $4,703,000 Commercial Oeerating Exeenses CAM Expenses 63,239 Sf Commercial GBA $15.00 /Sf/Year $949,000 Management Fee 3.50% Effective Gross Income 165,000 Commercial Operating Expenses $1,114,000 $3,589,000 I. Parking Income Hotel Room Spaces Meeting Room Spaces Commercial & Transient Spaces Parking Component 100 Spaces $45 /Space/Day 35 Spaces $20 /Space/Day 313 Spaces $6 /Space/Day $1,051, , ,000 Total Parking Income $1,918,000 Parking Expenses 448 Spaces $500 /Space/Year $224,000 $1,694,000 Total Project Net Operating Income I. Hotel Net Operating Income $3,463,000 3,589,000 1,694,000!Total Project Net Operating Income ss.146,ooo I Equates to $5.83 per square foot per month. Equates to $5.83 per square foot per month. Equates to $5.00 per square foot per month. Assumes an 80% average occupancy rate, and an 80% utilization rate. Assumes that the spaces are used 260 days per year. Assumes that the spaces average 75% occupancy. Filename: Robertson Lane Mixed Use_S 2118; Base Zoning PF; trb

Project Value s1z1,061,ooo I Supportable Land Value Project Value $127,067,000 (Less) Developer Profit 12% Project Value (15,248,000) (Less) Total Construction Costs (88,861,000)!

6 APPENDIX A TABLE 3 ESTIMATED SUPPORTABLE LAND VALUE I. Project Net Operating Income Hotel Net Operating Income $3,463,000 3,589,000 1,694,000!Total Project Net Operating Income ss,746,ooo I Project Value Total Project Net Operating Income $8,746,000 Wghtd Avg Capitalization Rate 6.88%!Project Value s1z1,061,ooo I Supportable Land Value Project Value $127,067,000 (Less) Developer Profit 12% Project Value (15,248,000) (Less) Total Construction Costs (88,861,000)!supportable Land Value 84,506 Sf Land $272 /Sf Land szz,9ss,ooo I Based on the weighted average of an 8.00% capitalization rate for the hotel component, a 5.75% capitalization rate for the commercial component, and a 7.00% capitalization rate for the parking component. Filename: Robertson Lane Mixed Use_S 2118; Base Zoning PF; trb

7 APPENDIX B SUPPORTABLE LAND VALUE Filename: Robertson Lane Mixed Use_S 2118; Project WO Factory; trb

Spaces $35,000 /Space 2,975,000 Level 3 157 Spaces $40,000 /Space 6,280,000 Level4 157 Spaces $45,000 /Space 7,065,000 Levels 157 Spaces $50,000 /Space 7,850,000 LevelG 150 Spaces $55,000 /Space

8 APPENDIX B TABLE 1 TOTAL CONSTRUCTION COSTS 1 I. Hard Costs Site Costs 84,506 Sf Land $25 /Sf Land $2,113,000 Demolition Costs 84,506 Sf Land $15 /Sf Land 1,268,000 Subterranean Parking Costs Level 1 44 Spaces $30,000 /Space 1,320,000 Level2 85 Spaces $35,000 /Space 2,975,000 Level Spaces $40,000 /Space 6,280,000 Level4 157 Spaces $45,000 /Space 7,065,000 Levels 157 Spaces $50,000 /Space 7,850,000 LevelG 150 Spaces $55,000 /Space 8,250,000 New Construction Building Costs Hotel 241 Rooms $215,000 /Room 51,815,000 Spa/Gym Club 1,052 Sf Spa/Gym GBA 2,462 Sf Club GBA $280 /Sf Spa/Gym GBA $280 /Sf Club GBA 295, ,000 Restaurant 18,730 Sf Restaurant GBA $280 /Sf Restaurant GBA 5,244,000 Retail 17,691 Sf Retail GBA $280 /Sf Retail GBA 4,953,000 Existing Building Rehabilitation Design Showroom 10,325 Sf Showroom GBA $25 /Sf Showroom GBA 258,000 Public Reta il 5,576 Sf Retail GBA $25 /Sf Retail GBA 139,000 Hotel FF&E / Commercial Tl Allowance Hotel 241 Rooms $40,000 /Room 9,640,000 Spa/Gym 1,052 Sf Spa/Gym GBA $35 /Sf Spa/Gym DLA 37,000 Club 2,462 Sf Club GBA $35 /Sf Club GLA 86,000 Restaurant 18,730 Sf Restaurant GBA $50 /Sf Restaurant GLA 937,000 Retail 23,267 Sf Retail GBA $30 /Retail GLA 698,000 Design Showroom 10,325 Sf Showroom GBA $25 /Sf Showroom GLA 258,000 Contractor Costs 20% Other Direct Costs 22,434,000 Total Direct Costs 283,328 Sf GBA $47S /Sf GBA $134,604,000 Soft Costs Arch, Eng & Consulting Costs 8% Direct Costs $10,768,000 Public Permits & Fees 283,328 Sf GBA $20.00 /Sf GBA 5,667,000 Taxes, Ins, Legal & Acctg Costs 3% Direct Costs 4,038,000 Marketing & Leasing Costs 65,777 Sf Commercial GSA $3.00 /Sf Comm. GSA 197,000 Hotel Pre-Opening/ Wkg Capital 241 Rooms $7,500 /Room 1,808,000 Development Management Fee 4% Direct Costs 5,384,000 Indirect Cost Cont. Allowance 5% Other Indirect Costs 1,393,000 Total Indirect Costs $29,255,000. Financing Costs Land Carrying Costs $31,900,000 Loan Amount 6.50% Interest $5,184,000 Interest During Construction $196,178,000 Loan Amount 5.50% Interest 18,343,000 Loan Origination Fees Construction Loan $196,178,000 Loan Amount 2.50 Points 4,904,000 Permanent Loan $155,507,000 Loan Amount 2.50 Points 3,888,000 Total Financing Costs $32,319,000!Total Construction Costs 283,328 Sf GBA $692 /Sf GBA s196,11s,ooo I Per direction from City staff, costs associated with relocation and rehabilitation of the Factory Building were not included in the scope; relocation and rehabilitation were introduced to the Project to avoid a CEQA impact to a cultural resource. The direct costs assume that prevailing wage requirements will not be imposed on the Project. Includes contractors' fees, general requirements, builder's risk insurance, and a direct cost contingency allowance. Based on a 30-month development period with a 100% average outstanding balance. Assumes an 24-month construction period with a 60% average outstanding balance, and a 6-month absorption period with a 100% average outstanding balance. 6 Based on a 7.39% weighted average capitalization rate and a 60% loan-to-value ratio. Filename: Robertson Lane Mixed Use_s 2118; Project WO Factory; trb

APPENDIX B - TABLE 2 ESTIMATED STABILIZED.NET OPERATING INCOME ROBERTSON lane MIXED-USE PROJECT Hotel Component I. Hotel Income Room Sales Revenues $380 /Room 241 Rooms $26,741,000 Food & Beverage 25.

0% Department Sales $22,200 /Room $5,348,000 Food & Beverage 70.0% Department Sales $29,900 /Room 7,200,000 Other 50.

9 APPENDIX B - TABLE 2 ESTIMATED STABILIZED.NET OPERATING INCOME ROBERTSON lane MIXED-USE PROJECT Hotel Component I. Hotel Income Room Sales Revenues $380 /Room 241 Rooms $26,741,000 Food & Beverage 25.0% Gross Sales $42,700 /Room 10,285,000 Other 10.0% Gross Sales $17,100 /Room 4,114,000 Gross Sales $41,140,000 Distributed Expenses Rooms 20.0% Department Sales $22,200 /Room $5,348,000 Food & Beverage 70.0% Department Sales $29,900 /Room 7,200,000 Other 50.0% Department Sales $8,500 /Room 2,057,000 Total Distributed Expenses $14,605,000 Undistributed Expenses General & Administration 8.0% Gross Sales $13,700 /Room $3,291,000 Marketing 7.0% Gross Sales $12,000 /Room 2,880,000 Utilities 3.0% Gross Sales $5,100 /Room 1,234,000 Maintenance & Operations 5.0% Gross Sales $8,500 /Room 2,057,000 Total Undistributed Expenses $9,462,000 Management Fees 3.0% Gross Sales $5,100 /Room $1,234,000 V. Fixed Expenses Property Taxes 1.1% Value $7,002 /Room $1,687,000 Insurance 1.5% Gross Sales $2,600 /Room 617,000 FF&E Replacement Reserves 4.0% Gross Sales $6,800 /Room 1,646,000 Total Fixed Expenses $3,950,000 VI. Hotel Net Operating Income 29% Gross Sales $11,889,000 Assumes a 80% occupancy rate. Filename: Robertson Lane Mixed Use_S 2118; Project WO Factory; trb

APPENDIX B TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME Commercial Component I. Commercial Income Club 2,462 Sf Club GBA $70.00 /Sf/Year $172,000 Restaurant 18,730 Sf Restaurant GBA $75.

50 /Sf/Year 412,000 CAM Reimbursements 65,777 Sf Commercial GBA $15.00 /Sf/Year 987,000 Gross Commercial Income $5,225,000 (Less) Vacancy Allowance 10.

10 APPENDIX B TABLE 2 ESTIMATED STABILIZED NET OPERATING INCOME Commercial Component I. Commercial Income Club 2,462 Sf Club GBA $70.00 /Sf/Year $172,000 Restaurant 18,730 Sf Restaurant GBA $75.00 /Sf/Year 1,405,000 Retail 23,267 Sf Retail GBA $70.00 /Sf/Year 1,629,000 Design Showroom 10,325 Sf Showroom GBA $60.00 /Sf/Year 620,000 Outdoor Dining Space 10,993 Sf Outdoor Dining $37.50 /Sf/Year 412,000 CAM Reimbursements 65,777 Sf Commercial GBA $15.00 /Sf/Year 987,000 Gross Commercial Income $5,225,000 (Less) Vacancy Allowance 10.0% Gross Commercial Income (523,000) Effective Gross Commercial Income $4,702,000 Commercial 0Rerating ExRenses CAM Expenses Management Fee 65,777 Sf Commercial GBA 3.50% Effective Gross Income $15.00 /Sf/Year $987, ,000 Commercial Operating Expenses $1,152,000 $3,550,000 Parking Component I. Parking Income Hotel Room Spaces Spaces $45 /Space/Day $2,533,000 Meeting Room Spaces 146 Spaces $20 /Space/Day 759,000 Commercial & Transient Spaces Spaces $6 /Space/Day 795,000 Total Parking Income $4,087,000 Parking Expenses 750 Spaces $500 /Space/Year $375,000 $3,712,000 Total Project Net Operating Income I. Hotel Net Operating Income $11,889,000 3,550,000 3,712,000!Total Project Net Operating Income s19,1s1,ooo I Equates to $5.83 per square foot per month. Equates to $6.25 per square foot per month. Equates to $5.83 per square foot per month. Equates to $5.00 per square foot per month. Equates to 50% of the restaurant lease rate. Assumes a 80% average occupancy rate, and an 80% utilization rate. Assumes the spaces are used 260 days per year. Assumes that the spaces average 75% occupancy. Filename: Robertson lane Mixed Use_s 2118; Project WO Factory; trb

Project Value $2s9,119,ooo I Supportable Land Value Project Value (Less) Developer Profit (Less) Total Construction Costs 12% Project Value $259,179,000 (31,101,000) (196,178,000)!

11 APPENDIX B - TABLE 3 ESTIMATED SUPPORTABLE LAND VALUE I. Project Net Operating Income Hotel Net Operating Income!Total Project Net Operating Income $11,889,000 3,550,000 3,712,000 $19,1s1,ooo I Project Value Total Project Net Operating Income Wghtd Avg Capitalization Rate $19,151, %!Project Value $2s9,119,ooo I Supportable Land Value Project Value (Less) Developer Profit (Less) Total Construction Costs 12% Project Value $259,179,000 (31,101,000) (196,178,000)!supportable Land Value 84,506 Sf Land $377 /Sf Land $31,900,ooo I Based on the weighted average of an 8.00% capitalization rate for the hotel component, a 5.75% capitalization rate for the commercial component, and a 7.00% capitalization rate for the parking component. Filename: Robertson Lane Mixed Use_S 2118; Project WO Factory; trb

MEMORANDUM. Ariel Socarras, Associate Planner City of Santa Monica. Jing Yeo, Acting Principal Planner

MEMORANDUM. Ariel Socarras, Associate Planner City of Santa Monica. Jing Yeo, Acting Principal Planner MEMORANDUM ADVISORS IN: Real Estate Redevelopment Affordable Housing Economic Development SAN FRANCISCO A. Jerry Keyser Timothy C. Kelly Kate Earle Funk Debbie M. Kern Reed T. Kawahara David Doezema LOS