residential housing analysis

This section was prepared by Zimmerman/Volk Associates, Inc. It was completed September 20, 2006. 4B Page 4B.1 residential housing analysis

STUDY CONTENTS MARKET POSITION ANALYSIS 4B.31 Introduction 4B.31 Market Potential 4B.53 Potential Housing Market 4B.75 Table 1: Potential Housing Market 4B.97 4B.10 Table 2: Target Residential Mix By Household Type 4B.14 12 Table 3: Target Groups For Multi-Family For-Rent 4B.15 13 Table 4: Target Groups For Multi-Family For-Sale 4B.16 14 Table 5: Target Groups For Single-Family Attached For-Sale 4B.17 15 Table 6: Target Groups For Urban Single-Family Detached For-Sale 4B.18 16 Target Markets 8 4B.19 Table 7: Summary Of Selected Rental Properties 4B.21 19 Table 8: Summary Of Selected For-Sale Properties 4B.31 29 Table 9: Optimum Market Position 4B.37 35 4B.39 4B.41 Appendix A: Calculations of Residential Values 4B.45 43 Optimum Market Position 17 Market Capture 37 Potential Alternative Development Scenarios 39 Building and Unit Types 4B.51 49 Multi-Family 4B.52 50 Multi-Family Unit Types 4B.53 51 Single-Family Attached 4B.54 52 Single-Family Detached 4B.54 52 Traditional Neighborhood Development 4B.55 53 Methodology 4B.57 55 Assumptions and Limitations 4B.73 71 Rights and Study Ownership 4B.74 72 o Page 4B.2

M A R K E T P O S I T I O N A N A L Y S I S Fort Monroe City of Hampton, Virginia September 20, 2006 INTRODUCTION This study identifies the market potential for new market-rate dwelling units both new construction and existing units, including adaptive re-use of non-residential buildings to be leased or sold within a redevelopment of Fort Monroe, a military installation located on Old Point Comfort at the tip of the Virginia Peninsula surrounded by the Chesapeake Bay to the east and south, and Mill Creek to the west. The property is a national historic landmark, containing dozens of attractive residences in addition to non-residential buildings; the fort itself, which is surrounded by a moat and contains the Casemate Museum; and the Old Point Comfort Lighthouse. Because of the illustrious history of the site, the exceptional beauty of the existing buildings, and the extraordinary water views that are available from the property, this analysis encompasses the market for new second/vacation housing units as well as year-round primary units. From the market perspective, the redevelopment of Fort Monroe holds the potential to become a development of national importance, attracting future residents and property owners from a larger draw area than would normally apply to new developments in Hampton Roads. The depth and breadth of the potential market for the site have been determined using Zimmerman/Volk Associates proprietary target market methodology. In contrast to classical supply/demand analysis which is based on supply-side dynamics and baseline demographic projections target market analysis establishes the optimum market position for a property derived from the housing preferences and lifestyle characteristics of households in the draw area and within the framework of the relevant housing market context. Page 4B.3

The target market methodology is particularly effective in defining housing potential because it encompasses not only basic demographic characteristics, such as income qualification and age, but also less-frequently analyzed attributes such as mobility rates, lifestyle patterns and compatibility issues. This study therefore has determined: Where do the potential renters or buyers for new primary and second/vacation dwelling units within a redevelopment of Fort Monroe currently live (the draw areas); Who are the potential renters/buyers and what are they like (the target markets); How many are likely to rent or purchase at the site if appropriate housing units were to be made available (depth and breadth of the market); What are their housing preferences in aggregate (multi-family, single-family attached and detached); What will they pay to rent or purchase newly-created dwelling units on the site (market-entry rents and prices); and What are their alternatives (supply-side analysis relevant new construction in Hampton Roads). The target market methodology is described in detail in the METHODOLOGY section at the end of this study. NOTE: Tables 1 through 6 outline the depth and breadth of the market for new year-round primary and second/vacation housing units within a redevelopment of Fort Monroe. Tables 7 and 8 summarize relevant supply-side data. Table 9 details the optimum market position for new dwelling units on the site. Tables 1 through 9 are located after the METHODOLOGY section. The Appendix Tables, which are included in a separate document, contain migration and target market data covering the appropriate draw areas for the site. Page 4B.4

MARKET POTENTIAL American households, perhaps more than any other nation s, have always demonstrated extraordinary mobility. Last year, depending on region, between 16 and 18 percent of American households moved from one dwelling unit to another. Household mobility is higher in urban areas and in the West; a higher percentage of renters move than owners; and a higher percentage of younger households move than older households. Analysis of migration, mobility and geo-demographic characteristics of households currently living within defined draw areas is therefore integral to the determination of the depth and breadth of the potential market for new year-round primary and second/vacation dwelling units to be developed within the Fort Monroe site. (See Appendix Tables and METHODOLOGY below.) Based on migration analysis as derived from taxpayer records compiled by the Internal Revenue Service the principal draw areas for new primary housing development on Fort Monroe are the local (City of Hampton) and the regional draw areas (the Cities of Newport News, Norfolk, Virginia Beach, Chesapeake, Poquoson and Portsmouth, and Suffolk, and York and Isle of Wight Counties). The analysis also factors in the market potential from all other counties represented in City of Hampton migration. As derived from migration analysis, then, the draw area distribution of market potential for new year-round residences in the City of Hampton would be as follows (see Appendix One, Table 6): Market Potential By Draw Area City of Hampton, Virginia City of Hampton (Local Draw area): Regional Draw Area: Balance of US: Total: 39.8 percent 26.1 percent 34.1 percent 100.0 percent SOURCE: Zimmerman/Volk Associates, Inc., 2006. Migration analysis often demonstrates a correlation between source counties for purchasers of primary residences and purchasers of second/vacation homes. In addition, as noted above, because Page 4B.5

of the history of the site, exceptional beauty of the existing buildings, and the potential for extraordinary water views, the market for new housing is likely to extend beyond the region. A s extrapolated from migration data, then, and in combination with anecdotal information from real estate agents and other knowledgeable sources, the most promising draw areas for vacation/second homes within Fort Monroe are the Washington, D.C. draw area (the District of Columbia, Arlington and Fairfax Counties, Virginia; and Montgomery and Prince George s Counties, Maryland); the Baltimore Draw Area (City of Baltimore and Baltimore County, Maryland); the Philadelphia Draw Area (Philadelphia, Chester and Delaware Counties, Pennsylvania); and the New York Draw Area (Manhattan, Brooklyn, and Queens Boroughs, New York; Westchester County, New York; and Bergen County, New Jersey). The draw area distribution of market potential for new second/vacation homes in Fort Monroe would therefore be as follows (see Appendix One, Table 12): Market Potential By Draw Area Second/Vacation Units FORT MONROE City of Hampton, Virginia Washington, D.C. Draw Area: 26.9 percent Baltimore/Philadelphia Draw Areas: 15.1 percent New York Draw Areas: 37.6 percent Balance of the U.S.: 20.4 percent SOURCE: Zimmerman/Volk Associates, Inc., 2006. Total: 100.0 percent The Washington, Baltimore, Philadelphia, and New York draw areas form the core of market potential, given appropriate marketing and advertising within those areas. As the property becomes established as a destination, the principal draw areas are likely to expand to include households from further afield. Page 4B.6

POTENTIAL HOUSING MARKET As determined by the target market methodology, in the year 2006, up to 6,750 empty nesters and retirees, younger single- and two-person households, and traditional and non-traditional families represent the potential market for new year-round primary and second/vacation housing units within a traditional neighborhood redevelopment of Fort Monroe. The housing preferences of these draw area households according to tenure (rental or for-sale), housing type and broad financial capacity can be arrayed as follows (see also Table 1): Potential Market For New Housing Units New Year-Round and Second-Vacation Housing Units FORT MONROE City of Hampton, Virginia NUMBER OF PERCENT HOUSING TYPE HOUSEHOLDS OF TOTAL Multi-family for-rent 680 10.1% Multi-family for-sale 1,280 19.0% Single-family attached for-sale 1,120 16.6% Low-range single-family detached 280 4.1% Mid-range single-family detached 1,370 20.3% High-range single-family detached 2,020 29.9% SOURCE: Zimmerman/Volk Associates, Inc., 2006. Total 6,750 100.0% The potential market typically includes the full range of housing types, corresponding to target household preferences, as follows (see also BUILDING AND UNIT TYPES below): Multi-family for-rent (e.g. apartments and/or lofts within multi-unit buildings); Multi-family for-sale (e.g. apartments and/or lofts within multi-unit buildings); Single-family attached for-sale (e.g. townhouses/rowhouses and/or duplexes); and Single-family detached houses (e.g. bungalows and/or cottages, two-story houses, as well as the largest and most expensive houses or mansions). Multi-family rental apartments represent just over 10 percent of the market potential; however, only a small segment of that market potential is for year-round rental units. Vacation rentals Page 4B.7

should be accommodated, as they are in other resort locations, through seasonal rental of individually-owned units. However, rental multi-family has been presented in this initial analysis; whether to include this housing type in the ultimate housing mix can be determined through the charrette process. Depending on the amount of land available for new residential development, higher-density housing types condominiums and townhouses will maximize unit yield. Given the spectacular views available, ranging from open water to an urban skyline, there is more than sufficient market potential for both condominiums and townhouses to achieve higher densities on the site. However, the distribution of a full range of housing types excluding large-lot single-family detached units, and based on the housing preferences and income levels of the draw area households that represent the potential market for new year-round and second/vacation housing units on the site would be as follows (see again Table 1): Target Residential Mix New Year-Round and Second-Vacation Housing Units FORT MONROE City of Hampton, Virginia NUMBER OF PERCENT HOUSING TYPE HOUSEHOLDS OF TOTAL Multi-family for-rent 680 16.3% (lofts/apartments, leaseholder) Multi-family for-sale 1,280 30.6% (lofts/apartments, condo/co-op ownership) Single-family attached for-sale 1,120 26.8% (townhouses/duplexes, fee-simple/ condominium ownership) Urban single-family detached 1,100 26.3% (detached houses, fee-simple) SOURCE: Zimmerman/Volk Associates, Inc., 2006. Total 4,180 100.0% Page 4B.8

Table 1 Potential Housing Market Derived From New Unit Purchase And Rental Propensities Of Draw Area Households With The Potential To Rent/Purchase Year-Round And Second-Vacation Units Fort Monroe The City of Hampton, Virginia The City Of Hampton; Regional Draw Counties; All Other U.S. Counties Draw Areas for Year-Round Units Washington, D.C. Metro Draw Area; Baltimore Metro Draw Area; Philadelphia Metro Draw Area; New York Metro Draw Area; Balance of the U.S. Draw Areas For Second-Vacation Units Total Households With The Potential To Rent/Purchase Year-Round/Second-Vacation Units At Fort Monroe 6,750 Potential Housing Market Year-Round and Second-Vacation Units Single- Multi-.................. Family........................ Family........ Attached............... Detached............. For-Rent For-Sale All Ranges Low-Range Mid-Range High-Range Total l Households: 680 1,280 1,120 280 1,370 2,020 6,750 x Distribution}: 10.1% 19.0% 16.6% 4.1% 20.3% 29.9% 100.0% Target Residential Mix Year-Round and Second-Vacation Units (Excluding Large-Lot Detached) Single- Multi-...... Family............ Family........ Attached.... Detached.. For-Rent For-Sale All Ranges Urban Total Total Households: 680 1,280 1,120 1,100 4,180 {Mix Distribution}: 16.3% 30.6% 26.8% 26.3% 100.0% NOTE: Reference Appendix Tables. SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.9

TARGET MARKETS The market for urban housing is now being fueled by the convergence of the two largest generations in the history of America: the 82 million Baby Boomers born between 1946 and 1964, and the 78 million Millennials, who were born from 1977 to 1996. Boomer households have been moving from the full-nest to the empty-nest life stage at an accelerating pace that will peak sometime in the next decade and continue beyond 2020. Since the first Boomer turned 50 in 1996, empty nesters have had a substantial impact on urban, particularly downtown housing. After fueling the dramatic diffusion of the population into everlower-density exurbs for nearly three decades, Boomers, particularly affluent Boomers, are rediscovering the merits and pleasures of urban living. At the same time, Millennials are just leaving the nest. The Millennials are the first generation to have been largely raised in the post- 70s world of the cul-de-sac as neighborhood, the mall as village center, and the driver s license as a necessity of life. As has been the case with predecessor generations, significant numbers of Millennials are heading for the city. They are not just moving to New York, Chicago, San Francisco and the other large American cities; often priced out of these larger cities, Millennials are discovering second, third and fourth tier urban centers. The convergence of two generations of this size simultaneously reaching a point when urban housing matches their life stage is unprecedented. This year, there are about 41 million Americans between the ages of 20 and 29, forecast to grow to over 44 million by 2015. In that same year, the population aged 50 to 59 will have also reached 44 million, from 38 million today. The synchronization of these two demographic waves will mean that there will be an additional eight million potential urban housing consumers nine years from now. The potential market for new for-sale year-round and second/vacation housing units within a resort-oriented development of Fort Monroe consists of a range of predominantly two-person households older empty nesters and retirees, as well as younger singles and couples and Page 4B.10

traditional families. The target groups for the site can be characterized by housing preferences as follows (see also Tables 2 through 6): HOUSEHOLD TYPE Target Residential Mix By Household and Unit Types New Year-Round and Second-Vacation Housing Units FORT MONROE City of Hampton, Virginia PERCENT... MULTI-FAMILY...... SINGLE-FAMILY... OF TOTAL FOR-RENT FOR-SALE ATT. FOR-SALE DET. FOR-SALE Empty-Nesters & Retirees 47% 31% 62% 43% 44% Traditional & Non-Traditional Families 25% 29% 5% 27% 45% Younger Singles & Couples 28% 40% 33% 30% 12% Total 100% 100% 100% 100% 100% SOURCE: Zimmerman/Volk Associates, Inc., 2006. The largest general market segment is composed of older households (empty nesters and retirees). A significant number of these households have children who no longer live at home; another large percentage are retired, with incomes from pensions, savings and investments. The primary residences of nearly 57 percent of these households are in the Washington, Baltimore, Philadelphia, and New York draw areas; a significant number of the units purchased by these households are likely to be used as second or vacation homes prior to retirement. These older households are quite dissimilar in their attitudes from family-oriented households. They have different expectations, and paramount among them is the perceived ease and convenience of singlelevel living, meaning a master suite on the ground floor and few stairs in the unit. They want their dwelling unit to accommodate, to the fullest extent possible, their ability to age in place. These potential purchasers are also among the most affluent households in the country Old Money; Urban, Small-Town, and Suburban Establishment; Affluent Empty Nesters; and Cosmopolitan Elite, among other. These older households make up more than 60 percent of the market for condominium units (multi-family for-sale) and 43 to 44 percent of the market for Page 4B.11

townhouses (single-family attached) and detached houses on the site. Older households represent more than 38 percent of the market for year-round residences, and 46 percent of the market for second/vacation homes. As noted above, over the next several years, this group of households should comprise a significantly larger proportion of the market as increasing numbers of the Baby Boom generation enter the empty-nest lifestage. The next largest general market segment is composed of younger households (younger singles and couples). Although these households have not yet reached their full income potential, those that represent the potential market for Fort Monroe have incomes above the median for each group. The largest potential markets for the site in this segment are e-types, The VIPs, New Bohemians, Upscale Suburban Couples, and Ex-Urban Power Couples, one-third of whom are currently living in Hampton Roads. These households are predominantly dual-income professionals, small business owners, or knowledge workers. Younger singles and couples represent 40 percent of the market for rental units, approximately a third of the market for condominium units (multi-family forsale), 30 percent of the market for townhouses (single-family attached), and just 12 percent of the market for detached houses on the site. Younger households make up approximately 25 percent of the market for both year-round residences and second/vacation homes. The smallest general market segment is comprised of family-oriented households (traditional and non-traditional families). Traditional families contain a married man and woman with an average of two or more children. These can also include blended families, in which each parent was previously married to another individual and each has children from that prior marriage. Non-traditional families, which during the 1990s became an increasingly larger proportion of all U.S. households, encompass a wide range of family households, from a single parent with one or more children, an adult caring for younger siblings, a grandparent with custody of grandchildren, to an unrelated couple of the same gender with adopted children. The largest potential markets for the sites in this segment are traditional family-oriented households. The households in several of the groups that are the primary markets for new primary and second/vacation housing within Fort Monroe Full-Nest Urbanites, The Social Register, The Page 4B.12

Entrepreneurs, and Exurban Elite have, on average, two or more children, aged in their teens and/or pre-teens. Heads of these traditional family households are business people, including professionals and small business owners. Family-oriented households comprise just five percent of the market for new condominiums (multi-family for-sale), 27 percent of the market for new townhouses (single-family attached), and 45 percent of the market for new detached houses within Fort Monroe. More than 25 percent of the market for year-round residences are family households, who also comprise just under 29 percent of the market for second/vacation homes. (Reference APPENDIX FOUR, TARGET MARKET DESCRIPTIONS, for greater detail on each target group.) Page 4B.13

Table 2 Target Residential Mix By Household Type Derived From New Unit Purchase And Rental Propensities Of Draw Area Households With The Potential To Rent/Purchase Year-Round And Second-Vacation Units Fort Monroe The City of Hampton, Virginia Multi- Single-...... Family............ Family........ Attached.... Detached.. Total For-Rent For-Sale All Ranges Urban Number of Households: 4,180 680 1,280 1,120 1,100 Empty Nesters & Retirees 47% 31% 62% 43% 44% Traditional & Non-Traditional Families 25% 29% 5% 27% 45% Younger Singles & Couples 28% 40% 33% 30% 12% 100% 100% 100% 100% 100% SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.14

Table 3 Target Groups For Multi-Family For-Rent Fort Monroe City of Hampton, Virginia..... Number of Households..... Empty Nesters Year- Second- Percent of & Retirees Round Vacation Total Total Urban Establishment 20 80 100 14.7% Small-Town Establishment 0 30 30 4.4% Suburban Establishment 10 0 10 1.5% Affluent Empty Nesters 10 20 30 4.4% Cosmopolitan Elite 10 0 10 1.5% Mainstream Retirees 30 0 30 4.4% Subtotal: 80 130 210 30.9% Traditional & Non-Traditional Families The Entrepreneurs 30 0 30 4.4% Ex-Urban Elite 10 10 20 2.9% Full-Nest Urbanites 40 40 80 11.8% Unibox Transferees 10 20 30 4.4% Full-Nest Exuurbanites 10 0 10 1.5% New-Town Families 30 0 30 4.4% Subtotal: 130 70 200 29.4% Younger Singles & Couples e-types 0 40 40 5.9% Fast-Track Professionals 10 0 10 1.5% The VIPs 60 0 60 8.8% Upscale Suburban Couples 0 30 30 4.4% New Bohemians 20 60 80 11.8% Twentysomethings 50 0 50 7.4% Subtotal: 140 130 270 39.7% Total Households: 350 330 680 100.0% SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.15

Table 4 Target Groups For Multi-Family For-Sale Fort Monroe City of Hampton, Virginia..... Number of Households..... Empty Nesters Year- Second- Percent of & Retirees Round Vacation Total Total Old Money 30 140 170 13.3% Urban Establishment 30 180 210 16.4% Small-Town Establishment 40 50 90 7.0% Suburban Establishment 40 30 70 5.5% Affluent Empty Nesters 40 50 90 7.0% Cosmopolitan Elite 40 30 70 5.5% Cosmopolitan Couples 30 0 30 2.3% New Empty Nesters 30 0 30 2.3% Mainstream Retirees 30 0 30 2.3% Subtotal: 310 480 790 61.7% Traditional & Non-Traditional Families The Entrepreneurs 10 20 30 2.3% Full-Nest Urbanites 10 10 20 1.6% New-Town Families 10 0 10 0.8% Subtotal: 30 30 60 4.7% Younger Singles & Couples e-types 10 130 140 10.9% Ex-Urban Power Couples 10 10 20 1.6% Fast-Track Professionals 10 20 30 2.3% The VIPs 60 10 70 5.5% Upscale Suburban Couples 10 20 30 2.3% New Bohemians 10 120 130 10.2% Twentysomethings 10 0 10 0.8% Subtotal: 120 310 430 33.6% Total Households: 460 820 1,280 100.0% SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.16

Table 5 Target Groups For Single-Family Attached For-Sale Fort Monroe City of Hampton, Virginia..... Number of Households..... Empty Nesters Year- Second- Percent of & Retirees Round Vacation Total Total Old Money 10 80 90 8.0% Urban Establishment 10 130 140 12.5% Small-Town Establishment 20 30 50 4.5% Suburban Establishment 20 10 30 2.7% Affluent Empty Nesters 20 30 50 4.5% Cosmopolitan Elite 30 40 70 6.3% Cosmopolitan Couples 20 0 20 1.8% New Empty Nesters 20 0 20 1.8% Mainstream Retirees 10 0 10 0.9% Subtotal: 160 320 480 42.9% Traditional & Non-Traditional Families The Social Register 20 80 100 8.9% The Entrepreneurs 10 50 60 5.4% Nouveau Money 20 0 20 1.8% Ex-Urban Elite 10 0 10 0.9% Full-Nest Urbanites 20 40 60 5.4% Unibox Transferees 10 20 30 2.7% Full-Nest Exurbanites 10 0 10 0.9% New-Town Families 10 0 10 0.9% Subtotal: 110 190 300 26.8% Younger Singles & Couples e-types 10 70 80 7.1% Ex-Urban Power Couples 20 10 30 2.7% Fast-Track Professionals 20 10 30 2.7% The VIPs 50 10 60 5.4% Upscale Suburban Couples 20 20 40 3.6% New Bohemians 10 80 90 8.0% Twentysomethings 10 0 10 0.9% Subtotal: 140 200 340 30.4% Total Households: 410 710 1,120 100.0% SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.17

Table 6 Target Groups For Urban Single-Family Detached For-Sale Fort Monroe City of Hampton, Virginia..... Number of Households..... Empty Nesters Year- Second- Percent of & Retirees Round Vacation Total Total Old Money 30 200 230 20.9% Urban Establishment 0 150 150 13.6% Small-Town Establishment 20 20 40 3.6% Suburban Establishment 10 0 10 0.9% Affluent Empty Nesters 10 10 20 1.8% Cosmopolitan Elite 30 0 30 2.7% Cosmopolitan Couples 0 0 0 0.0% New Empty Nesters 0 0 0 0.0% Mainstream Retirees 0 0 0 0.0% Subtotal: 100 380 480 43.6% Traditional & Non-Traditional Families The Social Register 20 170 190 17.3% The Entrepreneurs 40 40 80 7.3% Nouveau Money 40 30 70 6.4% Ex-Urban Elite 60 50 110 10.0% Full-Nest Urbanites 0 20 20 1.8% Unibox Transferees 0 20 20 1.8% Full-Nest Exurbanites 0 0 0 0.0% New-Town Families 0 0 0 0.0% Subtotal: 160 330 490 44.5% Younger Singles & Couples e-types 0 40 40 3.6% Ex-Urban Power Couples 0 30 30 2.7% Fast-Track Professionals 0 0 0 0.0% The VIPs 40 0 40 3.6% Upscale Suburban Couples 10 10 20 1.8% New Bohemians 0 0 0 0.0% Twentysomethings 0 0 0 0.0% Subtotal: 50 80 130 11.8% Total Households: 310 790 1,100 100.0% SOURCE: Claritas, Inc.; Zimmerman/Volk Associates, Inc. Page 4B.18

OPTIMUM MARKET POSITION From a market perspective, the assets of the site are considerable, including: Adjacency to, and panoramic views of, the Chesapeake Bay; The historic environment of the site; and The limited new resort construction available in Hampton Roads. From a market perspective, the challenges of the site are few, and include: Limited automobile access to the site (although some buyers are likely to view this as an asset); and The current lack of neighborhood-oriented retail within a reasonable drive of the site. Summary information for relevant rental and for-sale (covering both attached and detached) communities is provided as follows: for rental properties, the cities of Hampton, Newport News, Norfolk, and Portsmouth (see Table 7 following this section); for for-sale properties, the cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News (see Table 8 following Table 7). The optimum market position for Fort Monroe has therefore been developed based on a variety of factors, including but not limited to: Development of the property using the principles of traditional neighborhood design; The site s assets and challenges; The new unit primary and second/vacation home purchase propensities of draw area households; Building heights and densities sufficient to preserve the historic context as well as to promote neighborhood vitality; and A high-profile marketing campaign throughout Hampton Roads and the Washington, Baltimore, Philadelphia and New York metropolitan areas. Page 4B.19

Based on the characteristics of the target households, the residential context, and development of the property using the principles of the New Urbanism, the optimum market position for new resort-oriented residential development within Fort Monroe is as follows (see also Table 9 following Table 8): Optimum Market Position New Year-Round and Second-Vacation Housing Units FORT MONROE City of Hampton, Virginia HOUSING BASE RENT/ UNIT SIZE RENT/PRICE ANNUAL TYPE PRICE RANGE RANGE PER SQ. FT. MARKET CAPTURE MULTI-FAMILY FOR-RENT 16.3% 34 Soft Lofts $750 to 550 to $1.27 to $1,400/mo. 1,100 sf $1.36 MULTI-FAMILY FOR-SALE 30.6% 64 Soft Lofts $225,000 to 750 to $290 to $435,000 1,500 sf $300 Apartments $325,000 to 900 to $350 to $1,000,000 2,500 sf $400 SINGLE-FAMILY ATTACHED FOR-SALE 26.8% 56 Townhouses/ $475,000 to 1,500 to $313 to Duplexes $875,000 2,800 sf $317 URBAN SINGLE-FAMILY DETACHED FOR-SALE 26.3% 55 Houses $725,000 to 1,800 to $383 to $1,150,000 3,000 $403 SOURCE: Zimmerman/Volk Associates, Inc., 2006. Base prices for existing units, or new units developed through adaptive re-use of existing buildings, have been calculated at an average of between $300 and $400 per square foot, depending on unit condition, configuration, and square footage. All rents and prices are in year 2006 dollars and apply to the first marketing phase only. The recommended price levels place the units within the current purchasing capabilities of the target households and establish an optimum initial market position for residential development within Fort Monroe. The proposed prices do not include buyer options and upgrades, or view or location premiums, which are likely to be significant, depending on location. Page 4B.20

Table 7 Page 1 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... Eastern Hampton..... Cordoba (1972) 168 95% occupancy 100 Spanish Trail 84 1br/1ba $525 to 434 to $1.00 to Pool, patio, $575 576 $1.21 Curtesy officer. 48 2br/1ba $675 741 $0.91 36 2br/1.5ba $750 1,100 $0.68 Hampton Harbor (1991) 246 100% occupancy 8A Hampton Harbor Ave. 246 2br/2ba $699 to 1,120 $0.62 to Playground/courtyard, $719 $0.64 Security guard, Patios. Bridgeport (1998) 180 100% occupancy 100 Bridgeport Cove Dr. 132 2br/2ba $701 988 $0.71 Clubhouse, pool, 48 3br/3ba $809 1,156 $0.70 Playground/courtyard, Fitness center. Foxcroft I (1972) 104 100% occupancy 263-D Clemwood Parkway 16 1br/1ba $625 660 $0.95 Swimming pool, 33 2br/1.5ba $725 1,080 $0.67 Playground/courtyard, 40 2br/2ba $825 960 $0.86 Fireplaces, patios. 15 3br/2.5ba $1,125 1,440 $0.78 Harbor Square (1970) 368 93% occupancy 101 West Pembroke Avenue 44 1br/1ba $645 612 $1.05 Playground. 276 2br/1ba $700 to 860 to $0.81 to $845 860 $0.98 48 3br/1.5ba $899 1,036 $0.87 Page 4B.21 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 2 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... Eastern Hampton (continued)..... Kensington Square (1976) 184 94% occupancy 59 Stapleford Way 56 1br/1ba $660 660 $1.00 Clubhouse, pool, 56 2br/1.5ba TH $905 1,080 $0.84 Playground/courtyard, 56 2br/2ba $875 960 $0.91 Fitness center, 16 3br/2.5ba $1,250 1,440 $0.87 Fireplaces, patios. Mill Creek Landing (1998) 54 95% occupancy 117 B Atlantic Avenue 42 2br/2ba $960 to 1,216 to $0.79 to Controlled Access, $1,075 1,290 $0.83 Patios. 12 3br/2ba $1,165 to 1,334 to $0.87 to $1,235 1,334 $0.93 Willow Oaks (1972) 99 100% occupancy 600 Willow Oaks Blvd. 24 2br/2.5ba $925 1,300 $0.71 Swimming pool, 75 3br/2.5ba $1,025 to 1,675 to $0.61 to Playground/courtyard. $1,125 1,765 $0.64 Fireplaces, patios...... Western Hampton..... Coliseum (1980) 182 99% occupancy 135A Pine Chapel Road 78 1br/1ba $625 700 $0.89 Courtesy officer, 104 2br/1.5ba $715 960 $0.74 Patios. Cambridge (1976) 465 98% occupancy 5109 Goldsboro Dr. 68 1br/1ba $640 700 $0.91 Swimming pool, 372 2br/1ba $740 to 850 to $0.72 to Playground/courtyard, $865 1,200 $0.87 Storage, patios. 25 3br/2ba $1,000 1,500 $0.67 Falcon Creek (2006) In lease-up 4900 Falcon Creek Way 1br/1ba $850 727 $1.17 Walking trails; 2br/2ba $1,020 to 894 to $1.03 to Clubhouse; pool; $1,035 1,001 $1.14 business center. Page 4B.22 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 3 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... Western Hampton (continued)..... Northampton Village (1974) 567 94% occupancy 103-A Kathann Dr. 145 1br/1ba $660 to 638 to $0.91 to Swimming pool, $670 736 $1.03 Tennis, fitness center,. 119 2br/1.5ba $780 916 $0.85 Playground/courtyard, 212 2br/2ba $795 924 $0.86 Patios. 91 3br/2ba $890 1,085 $0.82 Township in Hampton 296 96% occupancy Woods (1987) 176 1br/1ba $699 to 500 to $1.12 to Clubhouse, pool, 260 Marcella Road $899 800 $1.40 Tennis, fitness center, 120 2br/2ba $995 to 1,050 to $0.95 to Fireplaces, patios. $1,119 1,150 $0.97 Spinnaker Cove (1987) 210 95% occupancy 102 Misty Cove 105 1br/1ba $680 to 600 to $1.13 to Clubhouse, pool, $725 600 $1.21 Tnnis, fitness center, 105 2br/2ba $880 to 1,000 to $0.88 to Fireplaces, patios, $965 1,000 $0.97 Storage. Addison at Hampton (1986) 276 95% occupancy 2 Wyndham Dr. 192 1br/1ba $730 to 489 to $1.18 to Clubhouse, pool, $885 749 $1.49 Tennis, fitness center, 84 2br/2ba $1,010 to 904 to $1.07 to Storage, fireplaces, $1,085 1,010 $1.12 Patios. Hampton Center (1985) 418 97% occupancy 6001 Terrell Lane 178 1br/1ba $699 to 689 to $0.98 to Pool, tennis courts, $865 880 $1.01 Ftness center, 66 2br/1ba $859 to 950 to $0.90 to Fireplaces, patios. $910 950 $0.96 120 2br/2ba $935 to 1,100 to $0.85 to $975 1,100 $0.89 54 3br/2ba $1,135 to 1,350 to $0.84 to $1,279 1,475 $0.87 Page 4B.23 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 4 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... Western Hampton (continued)..... Signature Place (1991) 232 97% occupancy 101 Signature Way 96 1br/1ba $765 to 642 to $1.05 to Clubhouse, pool, $880 839 $1.19 Tennis, fitness center, 24 2br/1ba $945 to 927 to $1.02 to Fireplaces, patios, $955 927 $1.03 Storage, garages. 96 2br/2ba $985 to 1,082 to $0.91 to $995 1,100 $0.90 16 3br/2ba $1,199 1,270 $0.94 Tradewinds (1989) 284 95% occupancy 2 Tradewinds Quay 96 1br/1ba $747 to 700 to $1.07 to Clubhouse, pool, $754 700 $1.08 Tennis, fitness center, 134 2br/2ba $904 to 950 to $0.95 to Storage, garages, $914 950 $0.96 Patios. 54 3br/2ba $1,110 to 1,210 to $0.92 to $1,130 1,210 $0.93 Bridgewater on the 216 95% occupancy Lake (1997) 72 1br/1ba $770 to 775 to $0.99 to Clubhouse, pool, 507 Marcella Road $865 865 $1.00 Tennis, fitness center. 118 2br/2ba $985 to 1,050 to $0.94 to Storage, garages, $1,045 1,100 $0.95 Patios. 26 3br/2ba $1,105 to 1,150 to $0.95 to $1,135 1,200 $0.96 Lake Ridge (2004) 282 97% occupancy 900 Lake Ridge Road 186 2br/2ba $1,080 to 1,000 to $1.08 to Clubhouse, pool, $1,100 1,000 $1.10 Business center. 96 3br/2ba $1,300 to 1,200 to $1.08 to $1,320 1,200 $1.10 Page 4B.24 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 5 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Newport News..... Earle of Warwick 107 100% occupancy Square (1986) 40 1br/1ba $495 to 750 to $0.66 to Swimming pool, 40 Maxwell $505 750 $0.67 Playground/courtyard, 31 2br/1.5ba $610 1,100 $0.55 Patios. 28 2br/2ba $635 1,050 $0.60 8 3br/2ba $800 1,200 $0.67 Newport Trace (1987) 132 100% occupancy 802 Constance Dr. 2 1br/1ba $605 900 $0.67 Clubhouse, pool, 130 2br/2ba $675 to 900 to $0.75 to Storage, $690 900 $0.77 Fireplaces. Chesapeake Bay (1987) 300 96% occupancy 550 St. Michael's Way 208 1br/1ba $760 to 486 to $1.20 to Clubhouse, pool, $965 806 $1.56 Tennis, fitness center, 92 2br/2ba $960 to 926 to $0.99 to Playground/courtyard, $1,074 1,082 $1.04 Fireplaces, storage, patios. On the Square (2002) 147 100% occupancy 3100 William Styron Square 30 1br/1ba $850 to 665 to $1.28 to Clubhouse, fitness, $1,050 956 $1.10 Business center, 93 2br/2ba $1,052 to 1,002 to $1.05 to Storage, carports, $1,487 1,289 $1.15 Fireplaces, patios. 24 3br/2ba $1,300 to 1,192 to $1.09 to Mid-rise. $1,450 1,235 $1.17 Jefferson Point (1985) 208 97% occupancy 128 Jefferson Point Lane 108 1br/1ba $665 to 536 to $1.30 to Clubhouse, pool, $949 732 $1.24 Tennis, fitness, 24 2br/1ba $900 to 908 to $0.99 to Business center, storage. $1,025 908 $1.13 Fireplaces, patios. 76 2br/2ba $855 to 789 to $1.10 to $1,130 1,027 $1.08 Page 4B.25 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 6 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Newport News {continued}..... Waverton Place *282 97% occupancy Impressions (1989) 102 1br/1ba $745 to 860 to $0.87 to Clubhouse, pool, 501 Coral Key Place $765 860 $0.89 Fitness, tennis, 120 2br/2ba $870 to 1,086 to $0.80 to Patios, courtyard. $890 1,086 $0.82 *132 additional units 60 3br/2ba $970 to 1,280 to $0.76 to under construction. $990 1,280 $0.77 Windsor Crossing (1986) 156 97% occupancy 12-C Cedarwood Way 36 1br/1ba $779 700 $0.95 Swimming pool, 120 2br/2ba $949 to 1,000 to $1.11 to Tennis, courtyard, $969 1,100 $0.88 Storage, patios. Park Place (2004) 361 99% occupancy 675 Town Center Dr. 37 1br/1ba $872 to 806 to $1.08 to Clubhouse, pool, $1,081 806 $1.34 Business center, fitness, 62 2br/2ba $1,131 to 1,154 to $0.98 to Carport, patios. $1,119 1,154 $0.97 Mid-rise. 12 3br/2ba $1,504 to 1,346 to $1.12 to $1,700 1,346 $1.26 Harbours (1985) 396 96% occupancy 502 Waters Edge Drive 96 1br/1ba $799 to 774 to $1.03 to Clubhouse, pool, $875 774 $1.13 Tennis, courtyard, 264 2br/2ba $959 to 1,050 to $0.91 to Fireplaces, storage, $1,015 1,050 $0.97 Patios. 36 3br/2ba $1,099 to 1,185 to $0.93 to $1,350 1,185 $1.14 Forest Lake at Oyster 296 96% occupancy Point (1988) 72 1br/1ba $895 to 780 to $1.03 to Clubhouse, pool, 307 St. Thomas Drive $928 905 $1.15 Tennis, fitness, 64 2br/1ba $977 960 $1.02 Fireplaces, storage. 120 2br/2ba $1,022 1,052 $0.97 40 3br/2ba $1,189 1,235 $0.96 Page 4B.26 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 7 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Norfolk..... Lafayette Towers (1964) 168 98% occupancy 4601 Mayflower Rd. 124 1br/1ba $664 to 500 to $0.91 $868 950 $1.33 to High-rise 41 2br/2ba $1,027 to 1,300 to $0.79 $1,127 1,300 $0.87 3 3br/2ba $1,144 to 1,800 to $0.64 $1,244 1,800 $0.69 Breezy Point (1997) 640 100% occupancy 8600 Glen Myrtle Avenue 384 1br/1ba $680 650 $1.05 Tennis courts, pool, 256 2br/1ba $830 850 $0.98 fitness center. Pembroke Towers (1964) 168 100% occupancy 601 Pembroke Ave. 120 1br/1ba $700 to 409 to $1.18 to Pool. $980 832 $1.71 High-rise 36 2br/2ba $1,125 to 1,104 to $1.02 $1,235 1,104 $1.12 12 3br/2ba $1,350 to 1,242 to $1.09 $1,480 1,242 $1.19 Beechwood (1984) 136 88% occupancy 7872 Ogden Ave. 24 1br/1ba $610 to 675 to $0.90 to Tennis courts, $660 to 695 to $0.95 Playground/courtyard. 88 2br/2ba $750 to 900 to $0.83 $810 990 $0.82 24 2br/1.5baTH $825 951 $0.87 24 3br/2ba $910 1,231 $0.74 John Knox Towers (1975) 150 93% occupancy 1210 Colonial Ave. 137 1br/1ba $675 to 422 to $1.25 to Clubhouse. $705 562 $1.60 High-rise 13 2br/1ba $850 692 $1.23 Page 4B.27 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 8 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Norfolk {continued}..... Hague Towers (1965) 256 100% occupancy 330 Brambleton Ave., West 190 1br/1ba $725 to 528 to $1.21 to Pool, $965 800 $1.37 fitness center. High-rise 17 2br/1ba $945 to 1,056 to $0.89 to $1,280 1,056 $1.21 49 2br/2ba $965 to 1,056 to $0.91 to $1,300 1,056 $1.23 Hampton Creek Aptss (1988) 118 100% occupancy 1612 Little Creek Rd., West 18 1br/1ba $785 825 $0.95 Pool. 100 2br/1ba $885 1,000 $0.89 Dockside (1986) 153 97% occupancy 390 Military Highway, S. 27 1br/1ba $740 to 684 to $1.08 to Clubhouse, pool, $760 684 $1.11 tennis courts, 126 2br/2ba $850 to 924 to $0.92 to fitness center. $870 924 $0.94 Ghent Village (1981) 140 100% occupancy 100 Westover Ave. 28 1br/1ba $775 to 569 to $1.36 to Clubhouse, pool, $1,045 804 $1.30 tennis courts, 102 2br/2ba $1,445 1,279 $1.13 fireplaces. 10 3br/2ba $1,545 1,334 $1.16 Crystal Lake (1985) 96 96% occupancy 5535 Virginia Beach Blvd. 96 2br/2ba $920 1,050 $0.88 Pool, storage. $975 1,200 $0.81 Page 4B.28 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 9 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Norfolk {continued}..... Park Crescent (1991) 288 95% occupancy 6450 Crescent Way 39 1br/1ba $1,010 910 $1.11 Clubhouse, 204 2br/2ba $1,310 1,285 $1.02 tennis, fitness center, 45 3br/2ba $1,500 1,560 $0.96 business center, fireplaces. Bristol at Ghent 268 Under Construction. 1600 Granby Street 1br/1ba $925 to 565 to $1.64 to 5-Story parking garage $1,245 825 $1.51 Business Center, 2br/2ba $1,425 to 1,036 to $1.38 to clubhouse, pool, $1,695 1,192 $1.42 Fitness Center. 3br/2ba $1,925 to 1,324 to $1.45 to $1,955 1,324 $1.48 Heritage at Freemason 184 100% occupancy Harbour (2000) 42 1br/1ba $1,066 to 768 to $1.39 to Clubhouse, 200 College Place $1,259 1,026 $1.23 fitness center, 97 2br/2ba $1,345 to 1,071 to $1.26 to fireplaces, carports $1,484 1,189 $1.25 45 3br/2ba $1,472 to 1,189 to $1.24 to $1,887 1,361 $1.39 Brambleton at Duke 248 Project Proposal. 20-Story building 1br/1.5ba n/a n/a n/a 3br/2ba n/a n/a n/a Rents reportedly will start at $1,250 to $2,400 Page 4B.29..... City of Portsmouth..... Heights at Olde Towne (1973) 148 93% occupancy 303 Effingham St. 56 1br/1ba $1,030 604 $1.71 Clubhouse, pool, 74 2br/1ba $1,220 872 $1.40 business and 18 3br/2ba $1,495 1,122 $1.33 fitness centers. SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 7 Page 10 of 10 Summary Of Selected Rental Properties Cities of Hampton, Newport News, Norfolk, and Portsmouth, Virginia June, 2006 Number Unit Reported Reported Rent per Property (Date Opened) of Units Type Base Rent Unit Size Sq. Ft. Additional Information Address..... City of Portsmouth {continued}..... Myrtles at Olde Towne (2004) 246 95% occupancy 850 Crawford Parkway 146 1br/1ba $1,060 to 751 to $1.41 to Clubhouse, pool, $1,375 811 $1.70 sports courts, 11 1br/1.5ba $1,270 to 936 to $1.36 to fitness center, $1,484 936 $1.59 garages. 89 2br/2ba $1,430 to 1,095 to $1.31 to $1,740 1,137 $1.53 Harbor Tower Apts. (1983) 191 95% occupancy One Harbor Court 94 1br/1ba $1,060 to 763 to $1.39 to Clubhouse, pool, $1,210 795 $1.52 fitness center, saunas, High-rise building 93 2br/2ba $1,230 to 1,050 to $1.17 to garages. $1,605 1,075 $1.49 4 2br/2.5ba $2,200 to 2,100 to $1.05 to $2,500 2,100 $1.19 Page 4B.30 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 8 Page 1 of 6 Summary Of Selected For-Sale Properties Cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News, Virginia January/June, 2006 Total Total Sales Unit B e d s / Unit Price Unit Size Price Per Lots/ (Monthly Development (Date Opened) Type B a t h s Range Range Sq. Ft. Units Average) Developer/Builder.... City of Hampton........ Water-Oriented.... Mainsail at Southall Landing 36 31 Mainsail, LLC. TH 3br/2.5ba $339,900 to 2,010 to $169 to 3br/3.5ba $521,467 2,705 $193 Condominiums At Bridge Street 30 Turzac Homes CO 2br/2.5ba $444,995 to 1,267 to $351 to 5br/2.5ba $674,995 1,913 $353 Phoebus Condominiums 40 21 Ocean Properties CO 2br/2.5ba $594,995 to 1,746 to $341 to reservations 3br/2.5ba $1,194,995 3,062 $390 Lakes at Howe Farms S F 4br/2.5ba $630,000 to 3,100 to $163 to 5br/3.5.5ba $860,000 5,264 $203.... City of Hampton........ Non-Water-Oriented.... Gosnold Hope Townhomes 28 26 Pace Construction TH 3br/2.5ba $255,000 to 1,722 to $146 to $259,000 1,773 $148 Reserve at Kings Cove 27 12 (1.5) Platinum Homes, LLC SF 4br/2.5ba $327,500 to 2,340 to $135 to 5br/2.5ba $360,200 2,673 $140 Hayes Farm Estates S F 4br/2.5ba $367,500 2,600 $141 4br/3ba $379,900 2,700 $141 3br/2.5ba $407,500 2,700 $151 3br/2.5ba $407,900 2,700 $151 4br/3ba $421,900 3,000 $141 4br/2.5ba $434,500 3,040 $143 5br/2.5ba $439,500 3,325 $132 Page 4B.31 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc. Spec Homes.

Table 8 Page 2 of 6 Summary Of Selected For-Sale Properties Cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News, Virginia January/June, 2006 Total Total Sales Unit B e d s / Unit Price Unit Size Price Per Lots/ (Monthly Development (Date Opened) Type B a t h s Range Range Sq. Ft. Units Average) Developer/Builder.... City of Norfolk........ Water-Oriented.... Lafayette River 130 n/ a Lafayette River Properties LLC CO 1br/1ba $269,900 to 900 to $227 to 7-story building 3br/2ba $499,900 2,200 $300 The Landings at Bolling Square 174 60 Collins Enterprises CO 2br/2ba $329,900 to 1,231 to $268 to 28 in 1st Phase 3br/2ba $575,900 1,980 $291 TH 3br/2ba $399,900 to 2,114 to $189 to 31 in 1st Phase 4br/3.5ba $799,900 2,931 $273 Tanners Landing 27 15 Axis Development CO 2br/2ba $375,000 to 1,589 to $236 to 3br/2ba $650,000 2,550 $255 The Spectrum at Willoughby Point 327 n/a Futura Group CO 1br/1ba $349,900 to 1,000 to $333 to TH 3br/2.5ba $1,000,000 3,000 $350 Harbor Walk (7/03) 237 54 (3.0) Genesis Group CO 3br/2ba $375,000 to 2,018 to $190 to 1- & 2-Story 4br/3ba $506,500 2,670 $186 TH 3br/2.5ba $390,750 to 2,425 to $161 to $396,608 2,450 $162 Page 4B.32 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 8 Page 3 of 6 Summary Of Selected For-Sale Properties Cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News, Virginia January/June, 2006 Total Total Sales Unit B e d s / Unit Price Unit Size Price Per Lots/ (Monthly Development (Date Opened) Type B a t h s Range Range Sq. Ft. Units Average) Developer/Builder.... City of Norfolk........ Non-Water-Oriented.... 388 Boush Street 94 72 Collins Enterprises LOFT 1br/1ba $153,500 to 770 to $199 to 6-story building 1br/1.5ba $209,500 976 $215 CO 1br/1ba $153,500 to 790 to $194 to 3br/2ba $425,500 1,921 $221 Ghent on the Square 111 71 (8.1) 105 Westover Ave. CO 1br/1ba $204,000 to 799 $255 to $210,000 $263 Condo Conversion. 2br/2ba $239,500 to 1,024 to $234 to $267,500 1,038 $258 3br/2ba $279,000 to 1,234 $226 to $315,000 $255 The Row at Ghent 84 60 (3.9) Bristol Develop. Group LLC CO 1br/1.5ba $242,900 to 969 to $227 to 5-story buildings 2br/2ba $295,900 1,305 $251 Also includes 268 rental apts. The Rotunda 66 n/ a Genesis Group CO 1br/1ba $268,280 to 976 to $366 to Adaptive re-use Penthouse 2br/2.5ba $926,160 2,531 $275 Granby Tower (12/05) 309 Marathon Develop. Group CO 1br/1ba $277,900 to 793 to $350 to 31-story building 1br/1.5ba $388,900 1,071 $363 2br/2ba $397,900 to 1,148 to $347 to 2br/2.5ba $709,900 1,762 $403 3br/2.5ba $689,900 to 1,977 to $275 to 4br/3.5ba $1,200,000 4,370 $349 Page 4B.33 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 8 Page 4 of 6 Summary Of Selected For-Sale Properties Cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News, Virginia January/June, 2006 Total Total Sales Unit B e d s / Unit Price Unit Size Price Per Lots/ (Monthly Development (Date Opened) Type B a t h s Range Range Sq. Ft. Units Average) Developer/Builder.... City of Norfolk........ Non-Water-Oriented {continued}.... Harbor Heights 99 77 Robinson Development CO/ 1br/1.5ba $295,500 to 1,104 to $268 to Group LOFT 3br/3ba $850,000 2,436 $349 16-story building The Ellington 20 5 Ellington Partners, LLC CO 1br/1ba $345,300 to 1,300 to $264 to 4-story building 3br/2ba $475,950 1,800 $266 East Beach East Beach Development Manor CO 2br/2ba $439,000 to 1,387 to $317 to $469,900 $339 Fourplex CO 2br/2ba $439,000 to 1,281 to $318 to 3br/2ba $599,000 1,886 $343 Villas 2br/2.5ba $477,500 to 1,482 to $322 3br/2.5ba $580,500 1,803 $322 CO 3br/2ba $529,900 to 1,800 to $294 to 3br/3ba $625,000 2,068 $302 TH 3br/2.5ba $565,000 to 1,850 to $220 to 4br/3.5ba $749,000 3,400 $305.... City of Portsmouth........ Non-Water-Oriented.... New Port 1,628 n/a L. M. Sandler & Sons CO 1br/1ba $150,000 to 850 to $176 to TH 3br/2ba $400,000 2,000 $200 S F 3br/2.5ba $268,110 to 1,838 to $120 to 3br/2.5ba $361,521 3,015 $146 Sterling Point TH 3br/2.5ba $277,900 1,147 $242 37 Page 4B.34 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.

Table 8 Page 5 of 6 Summary Of Selected For-Sale Properties Cities of Hampton, Norfolk, Portsmouth, Virginia Beach, and Newport News, Virginia January/June, 2006 Total Total Sales Unit B e d s / Unit Price Unit Size Price Per Lots/ (Monthly Development (Date Opened) Type B a t h s Range Range Sq. Ft. Units Average) Developer/Builder.... City of Portsmouth........ Non-Water-Oriented {continued}.... Park View S F 3br/2.5ba $429,000 to 2,739 to $157 to 3br/2.5ba $489,000 2,812 $174.... City of Virginia Beach........ Water-Oriented.... Old Beach Village 196 n/ a Hampton Roads Housing Lofts 1br/1ba $289,000 to 752 to $314 to 2br/2ba $489,000 1,558 $384 Flats 2br/2ba $499,000 to 1,543 to $314 to 4br/3.5ba $989,000 3,146 $323 The Sanctuary @ False Cape (9/04) 248 192 (9.1) Futura Group CO $550,000 to 1,400 to $393 to 6-story building $1,300,000 2,700 $481 Point Chesapeake 158 n/ a Teny-Peterson Residential & CO 2br/2.5ba $789,000 to 2,000 to $375 to Napolitano Enterprises 4br/3ba $1,500,000 4,000 $395 Ocean Park 27 11 CO 3br/2ba $923,895 to 2,276 to $406 to $1,312,500 2,618 $501.... City of Virginia Beach........ Non-Water-Oriented.... The Residences at Town Center Armada Hoffler CO 1br/1ba $360,000 to 816 to $441 to 119 48 20-story building 3br/2ba $3,000,000 3,450 $870 Page 4B.35 SOURCE: Collaborative Community Research & Design; Zimmerman/Volk Associates, Inc.