Pier 70 Feasibility Analysis · Final Report Pier 70 Feasibility Analysis Prepared for: Port of San Francisco Prepared by: Economic & Planning Systems, Inc. ROMA Design Group

Final Report

Pier 70 Feasibility Analysis Prepared for: Port of San Francisco Prepared by: Economic & Planning Systems, Inc. ROMA Design Group January 2010

EPS #17007

Table of Contents

1. EXECUTIVE SUMMARY ............................................................................................ 1

Introduction .............................................................................................................1

Financial Analysis Structure........................................................................................1

Development Program...............................................................................................3

Summary of Results and Key Findings .........................................................................3

Summary of Findings ................................................................................................7

2. PURPOSE AND METHODOLOGY................................................................................... 9

Purpose and Limitations.............................................................................................9

Evaluation Methodology .............................................................................................9

3. LAND USE PROGRAM ........................................................................................... 13

Uses Programmed................................................................................................... 13

Other Uses Considered ............................................................................................ 15

4. REVENUES ....................................................................................................... 17

Real Estate Revenues .............................................................................................. 17

Public Financing Sources.......................................................................................... 20

Private Capital Investment ....................................................................................... 23

5. COSTS............................................................................................................ 41

Sitework and Waterfront Improvements .................................................................... 41

Rehabilitation and Adaptive Reuse ............................................................................ 42

Ongoing Costs ........................................................................................................ 43

Costs Excluded from Pier 70 Feasibility Analysis.......................................................... 43

6. FEASIBILITY RESULTS .......................................................................................... 55

Financial Feasibility Analysis..................................................................................... 55

Summary of Investments and Returns....................................................................... 55

7. SENSITIVITY TESTS............................................................................................. 63

Sensitivities Tested ................................................................................................. 63

Results of Tests ...................................................................................................... 64

Appendix A: Additional Support Tables

Appendix B: Sensitivity Results

List of Tables and Figures

Table 1. Project Description Summary..............................................................................3

Table 2. Pier 70 Project Development Costs ......................................................................4

Table 3. Pier 70 Project Revenues ...................................................................................5

Table 4. Cost and Revenue Comparison............................................................................6

Table 5. Description of Uses Included in Feasibility Analysis ................................................. 13

Table 6. Project Description for 50 Acres ........................................................................ 16

Table 7. Summary of Vertical Pro Forma Results ............................................................. 19

Table 8. Summary of Rehabilitated Building Pro Forma Factors ......................................... 19

Table 9. Adaptive Reuse: Space by Type/Lease Rates ..................................................... 24

Table 10. Phasing Assumptions ....................................................................................... 25

Table 11. Infrastructure Financing District Bond and Debt Service Calculations ..................... 31

Table 12. Mello-Roos CFD Bond Debt Service Calculation ................................................... 34

Table 13. New Payroll Tax Calculation.............................................................................. 37

Table 14. Proposition D Revenues ................................................................................... 40

Table 15. Adaptive Reuse Pro Formas .............................................................................. 45

Table 16. Rehabilitated Buildings Cash Flow ..................................................................... 51

Table 17. Sources and Uses Table ................................................................................... 57

Table 18. Development Cash Flow................................................................................... 58

Table 19. Sensitivity Descriptions.................................................................................... 63

Table 20. Sensitivity Test Results .................................................................................... 66

Figure 1. Illustrative Development Plan—Preferred Master Plan, Pier 70 ................................8

Economic & Planning Systems, Inc. 1 P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc

1. EXECUTIVE SUMMARY

In t rod uc t ion

Pier 70 is an industrial brownfields development opportunity situated along San Francisco’s renowned waterfront. The site comprises 65 acres located along the City’s Central Waterfront just south of Mission Bay, bounded by Mariposa Street to the north, Illinois Street to the west, 22nd Street to the south and, to the east, San Francisco Bay. It is home to an unparalleled collection of historic, maritime industrial buildings as well as the largest, non-naval ship repair facility on the West Coast—all of the historic buildings are in need of significant investments to mitigate and repair deterioration. The Port of San Francisco (Port), as the site owner, retained a team of consultants to conduct technical analyses related to historic structures, environmental conditions, urban design, and market and financial feasibility analysis. The results of the technical work guided the preparation of a Preferred Master Plan for the site. This Report is one of several studies that support the plan (which has been drafted concurrently with this Report).

The Port retained Economic & Planning Systems, Inc. (EPS) to lead the Preferred Master Plan efforts and to conduct financial feasibility testing during the preparation of the document. Pier 70 presents unique development opportunities and challenging financial requirements. Although the site includes a significant amount of land suitable for revenue-generating new development, the costs associated with rehabilitation of historic structures, new infrastructure, environmental remediation, and open space development will require the coordination of investments from both public and private entities to achieve the primary goals of the project—creation of a mixed-use waterfront district, historic rehabilitation, open space, and enhanced public waterfront access.

EPS conducted financial feasibility analysis throughout the preparation of the Preferred Master Plan, testing various land use densities and use-types to shape the ultimate Plan. This Report details EPS’s key findings, assumptions, and information sources related to the feasibility analysis of the Pier 70 site. The actual project cash flow will depend on the timing, use, and extent of public financing options, the timing and actual costs of site development investments, and the rate of absorption and achievable values of new development and rehabilitated buildings.

F ina nc ia l Ana lys i s S t ruc ture

EPS prepared a financial model for the Pier 70 project that arrayed project costs and revenues into an annual cash flow for the development entity for a 30-year period. The model excludes the 15-acre BAE shipyard including its buildings and BAE’s lease payments to the Port. The financial analysis is similar to a base reuse or large-scale redevelopment project financial model. The financial model assumes that the Port will continue to own the land and enter into a long-term ground lease with a single development entity. A single developer for the site is an analytical assumption; the Port may lease the site in a difference manner. Consistent with

Pier 70 Feasibility Analysis Final Report 01/13/10


language contained in 2008 Proposition D,1 the model assumes that the Port will receive rent from the Pier 70 developer equivalent to the current interim income from the site, about $3 million per year.

In the cash flow model, the developer would undertake the “horizontal” development for the 50-acre site: infrastructure, site preparation, park and open space and pier/wharf projects. The developer would also rehabilitate the historic buildings and build the parking structures required on the site. As modeled, rather than constructing new buildings—the “vertical” development, the development entity would enter into land leases with developers or users for building sites. The developer and/or its subtenants, not the Port, would bear the capital costs of implementing the Plan.

The overall financial flows to the development entity modeled are:

• Rent from tenants of rehabilitated historic buildings and interim rent from existing tenants in the early years;

• Ground rent from the new building sites;

• Receipt of public finance funds as they are available to pay for allowed public uses;

• Parking income from structured parking; and

• Debt and investment from the private sector as required.

The financial analysis tests whether the public financing and expected real estate revenues are sufficient to attract the private sector investment needed for the Plan to succeed, but does not imply a preferred financing structure. A base case and a set of sensitivity analyses were prepared to evaluate Pier 70‘s financial feasibility.

The development costs included in the financial feasibility analysis include site preparation, environmental remediation, infrastructure (new streets and utilities), parks, pier and wharf improvements, parking improvements and historic rehabilitation. Cost estimates reflect a planning level of detail for the infrastructure, parks, remediation and other site costs. The historic building costs were developed with the benefit of field visits and a conceptual reuse program informed by historic architects, structural engineers hazardous materials experts and cost estimators. All of the capital cost estimates include a factor for soft costs including planning, entitlement and contingency. Also included are two ongoing costs to the development entity: base rent to the Port and environmental remediation monitoring.

1 Proposition D is a measure passed by San Francisco voters in November 2008, amending the City Charter (adding section B7.310) to allow the Port to utilize a portion of payroll tax and transient occupancy tax revenues collected from Pier 70 employers and hotel guests (if any) for specified investments at Pier 70. The full text of this charter section is an appendix of the Preferred Master Plan.



Parking is expected to be distributed throughout the site. Parking revenues are not expected to be sufficient to fund structured parking. The financial model reflects parking costs in two ways: a portion is included in the development pro forma for new and rehabilitated buildings and parking structures are a development cost.

Deve lopment P rog ra m

The Pier 70 Preferred Master Plan contains a framework for development of 50 acres of the site, excluding the 15-acre ship repair facility. The Plan includes more than 700,000 square feet of historic, rehabilitated building space, 3.09 million square feet of new development, and 22.6 acres of parks and open space, including a 7- and a 2-acre waterfront parks. Table 1 details this project description. Figure 1 illustrates the site plan included in the Preferred Master Plan document. The site plan demonstrates one approach to implementing the parameters contained in the Preferred Master Plan.

Table 1. Project Description Summary

Item Total (Yrs 0-20)

Rehabilitated Buildings (sq ft.) 721,569New Development (sq.ft.) 3,097,079

Total (sq.ft.) 3,818,648

Demolished Buildings (sq.ft.) 172,709

Parking Spaces 2,943Parking Ratio (spaces per 1,000 bldg. sq.ft.) [1] 1.03

Parks and Open Space (acres) 22.60

[1] The ratio is slightly above 1.0 space per 1,000 because of the higher parking ratio afforded the medical land use.

Summa ry o f Resu l t s and Key F ind ings

Results

The financial feasibility analysis evaluates the capital flow from the perspective of a master development entity that would prepare the site for new development (including environmental remediation and new infrastructure), complete rehabilitation of historic resources, and provide public amenities such as parks and open space. The revenues generated by these investments include historic building lease revenues, ground lease revenues (for new development pads), and available public financing sources such as federal historic tax credits, Infrastructure Financing District (IFD) bond, Mello-Roos Community Facilities District (CFD) bond, San Francisco 2008 Proposition D revenue, and San Francisco 2008 Proposition A Park Bond. The cash flow analysis results in two financial measures, both on an unlevered basis: (1) internal rate of return (IRR) and (2) cash flow net present value (NPV). Because potential private partners for the Port will each have unique preferences and mechanisms for establishing private financing for a project



like Pier 70, no assumptions on private financing are included nor has analysis been done to create a levered cash flow.

Development Costs

Table 2 reports costs used in the financial feasibility analysis totaled over a 30 year time period without including inflation (2009 dollar value). The largest cost item, historic rehabilitation, is shown before the application of federal tax credits.

Table 2. Pier 70 Project Development Costs

Item 30-year Total(thousands, 2009$)

Capital CostsHistoric Building Rehabilitation $355,000Piers/Wharfs $60,000Infrastructure and Site Preparation $70,000Structured Parking $30,000Parks/Open Space $30,000Site Remediation $20,000

Subtotal $565,000

Ongoing Costs - over 30 yearsBase Rent to Port $85,000Remediation Monitoring $5,000

Subtotal $90,000

Total Costs $655,000

Note: All capital costs include a 29 percent factor to cover planning, entitlement, and contingency. Rehabilitation costs include asbestos and lead paint abatement. Structured parking costs are adjusted for net parking revenues. Because of the planning level nature of these costs projections, estimates are shown to the nearest ten million.

Project Revenues

Table 3 summarizes the revenues from the project. The public financing sources available to the project are discussed above. The financial feasibility model estimated the public funding resources, based on the development program concept in the Preferred Master Plan, assumptions about timing, land and property values, and mix of users. Property tax projections assume that possessory interest tax (the property tax equivalent) is assessed on rehabilitated and new buildings.

Payroll tax projections factor in existing City payroll tax incentives for biotech and clean tech uses. If additional future users of Pier 70 are exempt from property or payroll taxes -- e.g., government or certain nonprofit users – assessment district, IFD revenue and Proposition D revenues could be reduced. Tax-exempt users will be required to pay an equivalent share of infrastructure and other costs to support Pier 70 public benefits and infrastructure.



Table 3. Pier 70 Project Revenues

Item 30-year Total(thousands, 2009$)

Development RevenueGround Lease - New Development $220,000Historic Building Lease $260,000Interim Lease Revenue $20,000

Subtotal $500,000

Public FinancingPark Bond Proceeds $10,000Proposition D Bond Proceeds $40,000Land-Secured Bond Proceeds (Mello-Roos) $80,000Infrastructure Financing District (IFD) Proceeds $110,000Historic Tax Credit $70,000

Subtotal $310,000

Revenue Total $810,000

Note: Because of the planning level nature of the revenue project, estimates are shown to the nearest ten million and exclude inflation. IFD revenues reflect receipt of 65 percent of the growth in property tax revenues.

New development and historic building rehabilitation projects will pay impact fees to support transportation improvements, affordable housing and child care facilities. These fees total about $70 million for the planned development program. These fees are included in the soft costs in the financial model.

Ground lease revenue from new development is based on the land value resulting from building feasibility analysis for each land use category. These ground lease revenues were adjusted downward to reflect the impact of CFD financing which imposes a special tax on new development sites. Lease revenue estimates for rehabilitated buildings were based on conceptual use programs for the various historic spaces and market rate rents.

Most project costs will occur periodically during the project timeline. In contrast, most revenues will be realized on an ongoing basis (e.g., ground lease and historic building lease revenues). In order to compare costs with revenues, revenues are shown here in constant 2009 dollars summed over 30 years.

Cost and Revenue Comparison

Development of Pier 70 will require a substantial outlay of capital. Including all costs and contingencies associated with preparing the land for new development and rehabilitating historic buildings, expenditures total $655 million, in constant 2009 dollars. Over a 30-year horizon, the development entity receives $810 million in revenues, but the costs of the project occur far earlier in time than the revenues generated. In particular, in the first five years, key 20th Street historic buildings (101, 102, 104, and 113/114) are projected to be rehabilitated, requiring an investment of $80 million, after adjustments for historic tax credits. A lender or investor must advance funds to move the project forward; these funds must later be returned with a risk-



appropriate level of interest. The cash flow shows a total of $165 million of private capital invested before the development entity realizes a return on that investment.

The financial cash flow includes all of the public financing sources secured to date and evaluates the “internal rate of return” (IRR) realized by the development entity. As presented, the project reflects an IRR of 10.2 percent. Real estate development projects of this complexity and risk generally require an IRR of 15 percent or more, reflecting the market returns required on a mix of private debt and investor equity.

This “feasibility gap” is the difference between the net present value (NPV) of the costs and revenues summarized over time, reflecting the risk adjusted, time-value of money. An NPV discount rate of 15 percent (reflecting a blend of private sector debt and equity) is used here. Because most of the revenues accrue after the development costs, this illustrative cash flow analysis demonstrates a feasibility gap of $46 million on a NPV basis. See Table 4 for the revenue and cost comparison on an NPV basis.

The $46 million feasibility gap indicates further refinement of the Pier 70 financial structure is required. Sensitivity testing demonstrates several pathways to a feasible project. Access to lower cost financing mechanisms, additional IFD revenues from State share of tax increment , and tuning the timing and magnitude of costs incurred will be the most important factors in closing the feasibility gap. The Port anticipates that real estate developers can bring additional insights into refining the project land use program, cost estimates and financing plan to meet market demands and assist in finding the best users for historic buildings, while meeting the Plan goals. Concerted efforts by the Port, its constituents and its partners to access additional funding sources and achieve additional value from the site will be needed to realize a successful project.

Table 4. Cost and Revenue Comparison

Item NPV (at 15%)(thousands)

RevenuesReal Estate Revenue $99,000Public Financing $94,000Historic Tax Credits $30,000

Subtotal $223,000

CostsHistoric Building Rehabilitation $150,000Infrastructure and Parking Structures $52,000Remediation $16,000Parks $16,000Rent to Port $25,000Piers/Wharfs $10,000

Subtotal $269,000

Net Result ($46,000)IRR 10.2%

Note: A detailed version of this information is provided in Table 17.



Summa ry o f F ind ings

The analysis demonstrates that development of the Preferred Master Plan may be feasible; however, its success depends upon significant private investment and additional financial resources beyond the “base case” assumptions, as described below.

1. The feasibility of development at Pier 70 requires a significant level of private investment.

With $565 million in capital costs to prepare the site for development, rehabilitate historic resources, and provide park and open space amenities, the revitalization of Pier 70 will require that the Port partner with a private entity with a proven track record for complex and successful redevelopment projects as well as financial resources sufficient to bring the long-term vision for Pier 70 to market.

2. In addition, funding beyond that included in the “base case” will be needed to generate a feasible project.

As shown in Table 4, the “base case” land use scenario results in a project IRR of 10.2 percent and has an NPV of negative $46 million calculated with a 15 percent discount rate. Several potential funding opportunities have not been included in the “base case” analysis such as additional IFD revenue, funds from other local revenues, and state, philanthropic, and/or federal grants. The results of the “base case” analysis indicate that additional funding will need to be secured in order to create the conditions which will attract private investments.

3. The infusion of one or more additional funding sources improves the project’s financial feasibility significantly.

Several of the sensitivities tested evaluate the feasibility effects of additional outside funding sources. The potential sources of outside funding tested include: the State’s portion of IFD funding (allows the project to capture the State’s share of site property tax increment), grants and philanthropic sources, and additional public funding from another source. These funding sources increase the project’s NPV significantly, with a combination of the State’s share plus additional outside grants resulting in a positive NPV for the Project.

4. Measures which delay expenditures without affecting revenue generation will further improve project feasibility.

The base case cash flow assumes that the infrastructure costs are substantially front-loaded in the project with 100 percent installed by year 10. A more detailed project plan and cash flow may reveal potential cost efficiencies which minimize or delay expenditures. One alternative

tests this potential efficiency by delaying infrastructure and environmental remediation costs.2 Combining additional public funding and enhanced IFD revenues with a delay in expenditures results in a project NPV of positive $20.0 million, achieving project feasibility.

2 It is important to note that this analysis did not test the physical or operational constraints associated with the timing and phasing of infrastructure or environmental remediation costs. The analysis only speaks to the financial implications of delaying investments. To the extent that spreading out these costs through time is not physically or practically possible, this alternative could not be implemented.

P I E R 7 0 P R E F E R R E D M A S T E R P L A N 5 1

1000 200 300’N

VERY SIGNIFICANT RESOURCE

SIGNIFICANT RESOURCE

CONTEXT RESOURCE

OPEN SPACE

SHIP REPAIR

BUILDING REMOVED

NEW BUILDING PADS

1A

1B

2A2B

3B

5A

6A

6B

6C

6D

6E

8A7A

5 C

5 B

3A

2CSHIP REPAIR

IRISHHILL

CRANE COVEPARK

SLIPWAYS PARK

New Building Sites

This diagram indicates potential sites for the general placement of buildings within each of the blocks. These building sites are not to be construed as the actual shape of future buildings, but rather as a general envelope for new buildings. The building sites were developed in consideration of the size and depth of building floorplates for potential new uses as well as in consid-eration of historic relationships such as the slipways and the objectives for creating visual and pedestrian linkages and open space relationships. Variations within these building sites is encouraged to create a finer grain scale and pattern that provides the appropriate context for the historic building and the district. Varia-tions in the building sites which achieve the desired density can also be considered if they comply with the historic district and other goals of the Plan.

Figure 1. Illustrative Development Plan—Preferred Master Plan, Pier 70

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2. PURPOSE AND METHODOLOGY

Purpos e a nd L im i ta t ions

The Preferred Master Plan provides a structure for development of Pier 70 that defines the elements of the Historic District, retained ship repair activity, new waterfront parks, and the envelope of supportable new development on the site. The Preferred Master Plan establishes a flexible development program. Phasing of improvements will need to be adaptable to changing market conditions and specific development and tenanting opportunities.

The purpose of including financial feasibility analyses throughout the drafting of the Pier 70 Preferred Master Plan is to ensure that the ultimate Plan reflects a development program which could achieve feasibility. To that end, feasibility analysis has been an integrated part of the master plan effort, helping to shape the direction of the Plan from the early stages through the development of the preferred land use concept.

Because feasibility testing relies upon estimates of market values and cost estimates, it reflects a snapshot of real estate economics at the time of the analysis. Though every effort has been taken to employ conservative estimates which avoid inflating the feasibility of the Plan, a positive, feasible result does not ensure success at Pier 70. Achieving the Pier 70 Master Plan, for any combination of land uses, will require a partnership with the private sector and a significant level of private investment well in advance of financial returns being realized.

Eva lua t ion M ethodo logy

The feasibility analysis has been completed assuming a master developer entity would prepare the 50-acre site for new development and manage the rehabilitation of all historic resources. The Master Developer framework was used for analytic purposes – it does not indicate a preferred transaction structure. (Note that the feasibility analysis does not include the ship repair operation.) Costs such as planning, entitlement, environmental remediation, infrastructure replacement, parks, and historic rehabilitation are compared with revenues anticipated from ground leases for new development and building leases for the rehabilitated building space and available public funding sources. The Preferred Master Plan provides flexibility in the mix of uses which may be included in newly development building space and rehabilitated buildings. In order to project revenues, this analysis assumed a specific mix of uses with sensitivity analysis to consider additional uses.

These revenues and costs are arrayed in an annual cash flow to determine the net present value of revenues and investments and the project’s internal rate of return. Various land use programs—in terms of intensities and uses—were tested in this manner. The program contained in the Preferred Master Plan reflects a result which meets the Port’s key goals for Pier 70—historic preservation, open space and shoreline access, and maintenance of the working shipyard. The feasibility analysis considers the viability of this development program to attract private investment.



The evaluation methodology includes known costs and revenues expected to be associated with Pier 70 development, as described in the Preferred Master Plan. These costs and revenues are all shown to be borne by and accrue to a master developer. In reality, the Port may make early investments in the property, as funds are available for specific purposes like historic building stabilization or environmental remediation.

Real Estate Revenues

Revenues are expected to accrue to the master developer from: (1) leases of existing, rehabilitated building space and (2) lease revenue for land at Pier 70 on which new development

will be constructed.3 The base case analysis assumes ground lease revenues instead of land sales, reflecting the Port’s retention of site ownership. To estimate the achievable lease revenues for rehabilitated building space and for developable land, the analysis employed two estimating techniques:

• Rehabilitated building space rent. Adaptive reuse concepts have been developed by the Planning Team for buildings intended for rehabilitation under the Preferred Master Plan. The concepts include estimated leasable square feet, use, (e.g., cultural/institutional, office, retail, industrial, etc.) and market rents. Using market rents for each use, revenues from the rehabbed buildings are estimated.

• Residual land lease value. Excluding rehabilitated buildings, parks and open space, public right of ways, and the shipyard, ROMA and the planning team estimated the total area available for new development. Based on the results of EPS’s December 2007 Pier 70 Master Plan Market Analysis and direction from the Port, three types of uses are included in the feasibility analysis for new development in the Plan: biotech, medical office, and general office space. The analysis includes estimates of expected land lease payments from the development types.

Public Financing

Public financing mechanisms which are required to facilitate upfront investments needed to prepare the site for redevelopment are also included in the analysis. Two key financing sources are:

• Infrastructure Financing District. Under State legislation, the Port may utilize tax increment financing through a mechanism called an IFD. The legislation allows the IFD to capture 65 percent of tax increment to fund infrastructure at the site. In addition, legislation is pending that would allow the Port to capture an additional 25.3 percent of the tax increment that would otherwise go to the State’s Educational Revenue Augmentation Fund. These annual tax revenues could support tax allocation bonds to be used for infrastructure and other public improvements on the site. The State’s portion is not included in the base case financial feasibility analysis, as it is an uncertain funding source.

3 The Preferred Master Plan illustrates a development program within rehabilitated buildings and the intensity of new development at the site.



• Mello-Roos Community Facilities District. A CFD may be used to establish a special tax on property within the district. The tax revenues can be used to secure CFD bonds for qualifying capital improvements, and can also be used to support ongoing maintenance and services. The special tax typically would be paid by owners or tenants of buildings on the site, although it can be structured to be paid initially by the site developer. The financial feasibility analysis assumes that building developers would discount sublease payments to a master developer to reflect the additional cost burden of the special tax.

In addition to the revenues from building and land leases, known non-Port funds are included as sources of investment to the project. Non-Port funding sources included in the analysis are:

• Federal historic tax credits which are available for applicable rehabilitation costs. • San Francisco Proposition A Park Bond funding for the waterfront park. • Proposition D payroll and transient occupancy tax revenue.

Proposition D was passed by San Francisco voters in November 2008, amending the City Charter to allow the Port to utilize a portion of payroll tax and transient occupancy tax revenues collected from Pier 70 employers and hotel guests (if any) for specified investments at Pier 70. Proceeds from the taxes may be used on a pay-as-you-go basis, or could be used to support revenue bonds.

Costs

Costs related to the redevelopment of Pier 70 include demolition of some existing structures, environmental remediation, building rehabilitation, new utilities, structured parking, park and open space development, and pier and wharf repair. These cost estimates are based on Port, in-house estimates and outside consultant efforts. Several additional documents are available that provide the background on cost estimates including Conceptual Estimate of Probable Construction Cost Based on Assessment of Building Conditions (M. Lee Corporation, July 2008).



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3. LAND USE PROGRAM

The land use program elements evaluated in the feasibility analysis are based on a collaborative planning effort led by EPS and ROMA Design Group under the direction of Port staff and incorporates key findings of technical analyses prepared by Carey & Company (historic preservation), OLMM Engineers (cost estimates), M Lee Corporation (cost estimates), and Treadwell and Rollo (environmental investigation). The sections below describe the types of uses included in the program and the total development at buildout of the project. These uses are included for evaluation purposes; actual uses may vary.

Uses P rogram med

A variety of development types and uses were considered for inclusion in the land use program. The mix of uses included is based on a market study of development prospects at Pier 70 (see Pier 70 Master Plan Market Analysis, released December 2007). Those which were selected for inclusion in the feasibility analysis are detailed in Table 5.

Table 5. Description of Uses Included in Feasibility Analysis

Use Development Characteristics

Biotech

The configuration of biotech buildings tends to vary by the size and type of company occupying the space. Smaller companies and research institutions are likely to require wet lab space for testing and experiments as well as more traditional office space. Mature or larger companies may require these research and office spaces as well as significant product production space.

Because of the need many biotech users have for precise control of temperature, moisture, and other elements and the difficulty in creating this type of space in an older building, biotech space is confined in the Pier 70 Plan to newly developed buildings only. New biotech buildings will have high floor-to-ceiling heights to accommodate the necessary heating, ventilating, and air conditioning (HVAC) systems.

Medical Office Medical office is included as a specific use because of the site’s proximity to the new University of California, San Francisco Mission Bay Hospital. This type of use is included within the new development portion of the land use program.

General Office General office uses are anticipated to be a large portion of the mix of uses. General office uses incorporated in the feasibility analysis include new office space and space in rehabilitated office or other types of buildings (e.g., industrial or warehouse) converted to office uses.



Table 5. Description of Uses Included in Feasibility Analysis (continued)

Use Development Characteristics

Retail/Restaurant/ Entertainment/ Cultural/Institutional

Aside from small cafes which may be integrated in new biotech or office space, the land use program includes retail, restaurant, entertainment, cultural and institutional uses within the historic buildings. Many of these structures—with their expansive interior spaces—are well-suited to uses which will allow public access. The Union Iron Works complex (Buildings 113/114 and 115/116) is anticipated to serve as the center of these types of uses.

Industrial/Warehouse Several of the existing buildings appear best suited for continued industrial or warehousing functions. These include Buildings 2 and 111.

Parking For the feasibility analysis, parking needs are expected to be met by locating parking throughout the site. To that end, parking space has been included in parking structures, within new buildings, and in appropriate portions of rehabilitated structures.

Parks and Open Space

Parks and open space are included throughout the land use program, specifically along the shoreline (Crane Cove Park and along the eastern edge of the site), adjacent to Irish Hill, and along 20th Street.

Table 6 summarizes this land use program.

Parking assumptions within the financial model seek to balance the pitfalls of providing too much parking—which would encourage single-occupancy vehicle commutes and displace valuable, revenue-generating space—with undersupplying parking which may decrease office and biotech rents and weaker the viability of uses reliant on visitors. With the goal of providing “just enough” parking, the parking ratio included in the financial analysis is 1.0 parking spaces per 1,000 square feet of building space. Parking ratios in central business cores with easy access to frequent transit service may have parking minimums of 0.5 spaces per 1,000 square feet or parking maximums which may be provided. Conversely, suburban office developments like those in South San Francisco and other areas on the Peninsula typically number 3.0 to 4.0 spaces per 1,000 square feet. The ratio selected for Pier 70 is in-line with recent development at Mission Bay, which has a similar density and commute profile as Pier 70.

The illustrative build-out scenario includes half of the required spaces within the vertical building pro formas and half in stand-alone parking structures. This means that the costs and revenues associated with building and operating the parking areas are included in the vertical pro formas of new construction and in a vertical pro forma for the parking structure. To the extent that adapted, historic structures appeared to be able to accommodate parking, a portion of spaces are also included in the historic rehabilitation and reuse pro formas.



Other Uses C ons ide red

Two other uses have been considered for the land use program: residential and hotel. Descriptions of these uses and the rationale for their exclusion from the current land use program are provided below.

Residential

Residential uses have been excluded from the land use program in order to avoid conflicts between residents and shipyard operations. When a ship is in drydock, the shipyard frequently operates throughout the day and night, generating typical heavy industrial operation impacts around the clock. In addition, a residential development at Pier 70 would likely be isolated from residential neighbors. With longstanding industrial uses across Illinois Street and a power plant site to the south (where residential uses are restricted), there are few known opportunities for residential conversions near Pier 70.

However, new residential units have been developed along both Illinois and Third Streets in recent years, indicating market support for housing in the area. In addition, the concentration of jobs anticipated at buildout of the land use program provides a rationale for incorporating housing into the program to offer new employees opportunities to live nearby. While residential uses have not been incorporated into the feasibility analysis, the integration of residential uses has been financially tested in the Sensitivities section of the Report.

Hotel

The employment capacity of the Preferred Master Plan combined with existing and planned commercial space and the future hospital at Mission Bay indicates the Central Waterfront area’s potential for becoming a significant new activity-center in the City. Employment and medical services in the area may be sufficient to support the development of a hotel. Although a hotel is an appropriate use at Pier 70, hotel square footage is not included in the financial feasibility analysis. Development of a hotel at Pier 70 would generate both land lease revenues as well as Proposition D transient occupancy taxes, potentially improving the project’s economics in a significant, favorable manner. A hotel use is excluded from the base case financial feasibility analysis in order to avoid skewing the analysis by assuming that a less common use will be developed at the site.

Table 6Project Description for 50 Acres (excludes 15 acres of ship repair uses)Pier 70 Financial Feasibility Analysis; EPS #17007


Rehabilitated Buildings (sq. ft.) [1], [2]Office 343,326Industrial/PDR 181,211Institutional 100,111Retail 73,363Parking 21,265Other (non-revenue generating) 2,294Subtotal 721,569

New Development (sq. ft.) ]2]Biotech Office 1,268,437Medical Office 126,844General Office 1,141,593Parking Structure 560,205Subtotal 3,097,079

Total Development and Rehabilitated (sq. ft.) 3,818,648

Demolished Building Square Footage 172,709Parking Parking in Structure (spaces) 1,724Parking in Individual Buildings (spaces) 1,211Total spaces provided 2,935Parking Ratio (spaces per 1,000 bldg. sq. ft.) [2] 1.0

Parks / Open Space Acreage [3]Crane Cove Park 7.73Irish Hill 1.53Shipways Park 4.89Central Plaza 0.41Blocks 1-6 Open Space/Plazas 8.03Total Parks and Open Space 22.60

[1] Square footage is shown for historic buildings by the type of use used in the model. Several buildings areexpected to accommodate a mix of uses.

[2] Parking is in part provided in structures and in part within buildings. Square feet by use reflects the total gross building square feet, a portion of which is used for parking.

[3] The ratio is slightly above 1.0 space per 1,000 due to the higher parking ratio afforded the medical land use.[4] Equal to 984,569 sq, ft. Open space on "blocks" 1 through 6 includes plazas and the spaces between development

within the blocks as illustrated in the Preferred Master Plan.

Source: Port of San Francisco; ROMA Design; Economic & Planning Systems

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4. REVENUES

Revenue sources include direct revenue from site users (lease revenue) and public revenue. The sections below describe the types and magnitude of revenues.

Rea l E s ta te Reve nues

The project will receive rent revenues from rehabilitated building leases and ground leases for new development pads.

Ground Lease Revenue

Revenues will be generated through ground lease revenue. The value of the ground leases are based on land values determined by the difference between vertical construction costs and the capitalized value of the building. Revenues from new development uses has been estimated by: (1) Establishing assumptions for net rents from tenants; (2) Estimating direct and indirect building construction costs; (3) Including cost overruns (contingency) and a builder profit; (4) Capitalizing revenues, net of total costs which results in the residual land value for the given use; and (5) Assuming that a proportion of the residual land value (8.5 percent) represents the land lease value. The land lease value is the cash flow that a horizontal developer may expect to receive from a vertical developer, constructing particular uses and amounts of leasable building space. These steps result in an estimate of the value of the land generated by the development. The ground rent per use is developed in 2009 dollars in a series of vertical pro formas included in Appendix A. Descriptions of assumptions used for capitalization rates, ground lease factors, and parking are included below.

Capitalization Rates

A capitalization rate (cap rate) is the ratio between the net operating income of an asset and the total market value of the asset. In the vertical pro formas for Pier 70 buildings, capitalization rates are used as assumptions to estimate the market value of the net operating income. Cap rates reflect the perceived risk associated with the project including the estimated development costs, vacancy rate, and building lease rates. Historic capitalization rates in San Francisco’s office market range from about 5 percent to 9 percent (i.e., net operating income is between 5 and 9 percent of total market value). Three different cap rates are applied in the vertical pro formas:

• New commercial development. Given the various opportunities and constraints of development at the site, a cap rate in the middle of the historic range has been selected for all new commercial development modeled at Pier 70 (7 percent).

• Rehabilitated buildings. While some of the rehabilitated buildings may provide unique and spectacular spaces, other older buildings adapted for modern uses may not provide the same level of amenities and functionality that new construction supplies. Rather than



differentiating among the buildings and projecting how the market will view these buildings, a single cap rate has been applied to all historic buildings, at the high end of the historic range (8.5 percent).

• Parking structure. A conservative cap rate has been applied to parking structures (9 percent)

Ground Lease Factor

The residual land value results from subtracting total development costs from the building value. This represents the value of the land, given the assumed development program built. In order to calculate the annual lease rate a developer would be willing to pay for the right to construct the project, a ground lease rate factor is applied to the residual land value. For modeling purposes, the ground lease factor selected (8.5 percent) is equivalent to a conservative capitalization rate for the San Francisco land.

Parking Assumptions

The portion of parking for the project that is provided within the building pads (0.5 spaces per 1,000 square feet of building space with another 0.5 spaces per 1,000 included in standalone parking structures) is included in the pro formas by use. To estimate lease revenue, the building size is reduced to account for the portion occupied by parking. Parking revenues are included assuming monthly parking rates of $225 in 2009 values and daily rates of $8 per space.

New Building Development Revenue

Values for ground leases vary according to use, as shown in Table 7, below. Appendix Tables A1 through A8 provide details on the vertical costs and revenues associated with new development by type of use. For example, Table A1, the biotech use pro forma, illustrates the square feet of new development assumed in the analysis and the revenues and costs associated with the construction and occupancy of the development. The calculation results in an estimated residual land lease value. This lease value is applied to the revenue section of the project cash flow.

Reversion Value

At the end of the 30-year cash flow period, the lump-sum value of future ground lease and rehabilitated building lease revenues are included in the analysis for the NPV and IRR measures. This means that at the end of the 30 years, the development entity may sell its interest in the site. This potential sale value is estimated to be equal to the present value of future lease income less annual costs (e.g., base rent to the Port, environmental monitoring costs, etc.).



Table 7. Summary of Vertical Pro Forma Results

Item BiotechMedical

OfficeGeneral

Office

End User Rent/Price

$50 $46 $40 / building Sq. Ft./year (NNN)

$150 /room per night

$510,000 / Unit $3 /Sq. Ft. per month

Construction Cost

$435 $348 $352 /building Sq. Ft. $299 /building Sq. Ft.

$452 /building Sq. Ft.


Building Value $509 $407 $410 /building Sq. Ft. $362 /building Sq. Ft.



Residual Land Value

$75 $59 $58 /building Sq. Ft. $64 /building Sq. Ft.



Ground Rent $6 $5 $5 /building Sq. Ft./year

$5 /building Sq. Ft./year



For-Sale Condominiums

Rental ApartmentsHotel

Existing Building Lease Revenue

In order to estimate likely revenues and costs of rehabilitated buildings, the Port team and consultant developed an adaptive reuse program. The program includes total building square footage and use for each building expected to be included in the land use plan. The uses included in the adaptive reuse program are office, institutional/ cultural, retail, warehouse or storage, retail, and parking. Lease revenues associated with these uses range in value from $15 to $36 per square foot per year. All of the lease rates contained in the historic buildings analysis are based on advertised space for rent in late 2007 in the Dogpatch/Potrero Hill/Showplace Square area of the City. Table 8 illustrates the average result for all historic buildings in terms of the end user price (lease rate), the rehabilitation cost, the building value based on the capitalized lease stream, and net value of the rehabilitated building.

Table 8. Summary of Rehabilitated Building Pro Forma Factors

Item

End User Rent/Price

$26 / building Sq. Ft./year (NNN)

Construction Cost $456 /building Sq. Ft.

Building Value $231 /building Sq. Ft.

Net Rehabilitated Building Value

($134) /building Sq. Ft.

Average

Table 9 illustrates the uses by building and expected lease revenues. The uses and building square feet devoted to each use were developed based on site tours by ROMA, EPS, and the Port and extensive discussions regarding the most appropriate use for each building. These represent the leasable square footage. In several cases, large single-story buildings are assumed to be subdivided with mezzanine areas.



Timing of Development

The absorption rate of new development and occupancy of existing building space is a primary driver of the feasibility of the Plan. Based on the results of EPS’s market study completed for the Port for Pier 70, full Plan buildout assumes an 18-year absorption. This absorption period translates into an average of 170,000 square feet of new building space occupied annually. Table 10 illustrates the absorption of specific historic buildings and new development on an annual and cumulative basis.

Interim Leasing Revenues

At the present, Pier 70 has a number of existing tenants paying about $2.9 million a year in rent. The financial model assumes that these leases phase out over the first ten years of the development program and that the master developer receives the interim leasing revenue. The exact timing of termination of existing leases will be determined as the project is implemented. It is likely that some users can be relocated into rehabilitated historic buildings and retain operations at Pier 70.

Pub l i c F ina nc ing Sources

The financial requirements to adaptively reuse Pier 70 will require a full range of public and private financing sources and mechanisms integrated in a comprehensive financing strategy. A substantial portion of the funds needed for development of infrastructure and public facilities and to rehabilitate historic structures will come from real estate revenues generated by rehabilitated buildings and from new development. Financial analyses to date demonstrate that the economic value of new uses at Pier 70 cannot fund the extraordinary costs of historic rehabilitation, environmental remediation, parks, and new infrastructure. Public financing mechanisms are required to close the feasibility gap. This section discusses potential public financing tools in this implementation effort: Infrastructure Financing District , Mello-Roos Community Facilities District, and Pier 70 Proposition D funding.

Infrastructure Financing District

As discussed earlier, an IFD allows for growth in future property taxes to be captured and reinvested in the project. This revenue stream can be accessed by public bonds on a tax-exempt debt basis and can be used on an annualized, pay-as-you go basis as well. Property taxes grow significantly after rehabilitation and development is well underway, making this tool valuable. Only when public finance markets know that an adequate property tax revenue stream is in place, or soon will be, to pay back the bonds can bonds be issued. Property tax-based finance is a common tool used for redevelopment and new development projects in California.

IFD revenues are estimated by projecting the assessed value of new development and rehabilitated buildings, less any existing property assessed value. (Table 11 illustrates the calculation.) These values are based on the capitalized net operating income of the buildings. The difference between the two is the incremental assessed value. One percent of the incremental value is the incremental tax value and a portion of that amount may be captured for the project. Under the State legislation which enables the Port to create IFDs, the local portion of the tax increment may be captured by the Port for investments in the property including



infrastructure, historic rehabilitation, and other site improvements.4 The EPS analysis assumes that 65 percent of the total tax increment will be subject to use by the project. In order to calculate the amount of the IFD bonds, EPS completed the following steps:

• Estimate the value of the new uses (capitalized value of new construction plus capitalized value of rehabilitated buildings), less the existing value of the site.

• Multiply the incremental amount by 1 percent to calculate the tax increment (TI).

• Calculate 65 percent of the TI, reflecting the assumed portion of tax increment which may be diverted to IFD improvements.

• Use 65 percent of TI to make a bond payment with the coverage factor of 1.25

• Estimate bond proceeds assuming issuance over a 30-year term with the interest rate of 6.0 percent and an issuance cost of 10 percent.

Mello-Roos Community Facilities District

A CFD may be used to establish a special tax on property within the district. Creation of a CFD to finance the construction of new community infrastructure would levy additional property taxes on land located inside the district, creating a revenues stream to issue bonds. Table 12 projects the level of revenues which may be generated through the tax. The cumulative new assessed value created through the development of new development is shown. The analysis utilizes the following steps to estimate financing from CFD bonds:

• Estimate the overall development value.

• Base the CFD payment on 0.65 percent of the overall development value.

• Assume a cost of 12 percent for delinquencies and 0.5 percent for administration.

• The bond issuance is assumed over a 30-year term with an interest rate of 6.0 percent and an issuance cost of 5.0 percent.

The use of a CFD is considered to be a financing tool which may be selected by development partner(s). The special tax typically would be paid by owners or tenants of buildings on the site, although it can be structured to be paid initially by the site developer. The analysis assumes that building developers would discount sublease payments to a master developer to reflect the

additional cost burden of the special tax.5 Assuming a tax of 0.65 percent of assessed value,

4 Table 11 also calculates the State’s portion of the tax increment. This amount is calculated for illustrative purposes only, the revenue is not included in the base case project cash flow.

5 This estimate is based on EPS’s experience in prior projects. The tax amount is often viewed as somewhat separate from the lease rate, suggesting that tenants tend to partially discount the lease amount they are willing to pay by the amount of the CFD tax. This may change to a discount rate of 100 percent as tenants analyze how the tax may affect their total payments for space.



more than $120 million in bonds may be issued while new development is constructed. Note that although the tax value is calculated on ad valorem basis for modeling, the actual implementation would be structured some other metric, such as parcel or building size.

Proposition D

The other major source of public funding is the provisions for funding under the November 2009 Proposition D adding section B.7.310 to the San Francisco Charter. The Board of Supervisors can adopt a Pier 70 Finance plan that commits to Pier 70 a 20-year funding stream equivalent to up to 75 percent of the projected growth in payroll and hotel taxes generated by the Pier 70 project. The model only assumes payroll taxes are generated based on the expected building program. Table 13 details the calculation of this funding source. As shown, building square feet absorbed per year are translated into on-site employment, based on estimated employment density. Payroll taxes in San Francisco are calculated based on 1.5 percent of payroll.

In order to estimate the payroll of the various types of tenants which may locate at Pier 70, EPS consulted the Bureau of Labor Statistics estimates of average wages for the San Francisco area for several types of occupations including Office and Administrative Support; Life, Physical, and Social Science; Healthcare Practitioner, Technical and Healthcare Support; Office and Administrative Support; Business and Financial Operations; Computer and Mathematical Science; and Architecture, Engineering, and Legal. Because wages below a certain level and biotech companies which have been located in San Francisco for seven years or less are exempt from the payroll tax, only a portion of the total wages projected to be earned on site are included in the estimate of payroll taxes. Specifically, the following steps outline the approach in estimating the payroll tax:

• Estimated employment based on building densities with 450 square feet per employee for existing uses and new biotech space and between 275 and 350 square feet per employee for general and medical office space. These assumptions result in the total of 6,195 new employees.

• Calculate the total payroll by development type based on likely occupation assumptions by land use and income assumptions by industry provided by the Bureau of Labor Statistics. The incomes are estimated to range from an average of $39,400 for employees in existing uses to an average of $76,200 for biotech employees.

• Total payroll is estimated by adding up the aggregate incomes across land uses with 80 percent of the payroll assumed to be subject to the payroll tax. This assumption is based on the San Francisco payroll tax ordinance that exempts clean energy technology sector, jobs partially located in jurisdictions outside of San Francisco, and jobs with incomes below a minimum threshold, as defined by the City. In addition, positions in biotech are assumed to be subject to 50 percent of the payroll tax during the first seven years based on the payroll tax ordinance exemption for biotech firms during the first seven years of operation in the City.

• 75 percent of the 1.5 percent payroll tax is assumed to be invested into infrastructure and approved projects at Pier 70 which is equal to the maximum portion which may be used for this purpose, per the language in Proposition D.



Taking all of these assumptions into consideration, approximately $350,000 per year is expected to be generated from Proposition D-allowed payroll taxes.

For the purposes of analysis, payroll taxes generated are assumed to be used to support a revenue bond. Table 14 estimates the value of the bond. As shown, net of various administrative costs, the bond supported a payment equivalent to 75 percent of the payroll tax generation for 20 years, totaling $48.5 million assuming 6 percent interest rate and 5 percent issuance costs. This amount is included in the project cash flow in year 5. The other primary public funding source, federal historic tax credits, will be discussed in the next chapter.

Pr iva te Cap i ta l Inves tment

In addition to the above revenue sources, a substantial amount of private capital investment will be necessary to accomplish the redevelopment of Pier 70. Early investments will be needed for planning and predevelopment, environmental analysis, and entitlement activities. The model assumes a $2 million year 0 cost for this. Post entitlement, private capital will be needed for demolition, environmental remediation, grading, infrastructure, marketing, and other project development costs as development proceeds and project revenues increase over the course of buildout.

Table 9Adaptive Reuse: Space by Type/Lease RatesPier 70 Financial Feasibility Analysis; EPS #17007

Building Bldg. Sq. Ft. Office Industrial Institutional Retail Parking Other Office Industrial/PDR Institutional Retail Parking Other Total Ave.Numbers per

$36.00 $15.00 $20.00 $18.00 $4.50 $0.00 Sq.Ft. [2] [3] [4] [5] [6] [7]

101 56,268 56,268 0 0 0 0 0 $2,025,648 $0 $0 $0 $0 $0 $2,025,648 $36104 37,641 37,641 0 0 0 0 0 $1,355,076 $0 $0 $0 $0 $0 $1,355,076 $36102 8,424 0 0 0 8,424 0 0 $0 $0 $0 $151,632 $0 $0 $151,632 $18103 2,258 0 0 0 2,258 0 0 $0 $0 $0 $40,644 $0 $0 $40,644 $182 96,804 28,073 68,731 0 0 0 0 $1,010,634 $1,030,963 $0 $0 $0 $0 $2,041,596 $216 37,707 0 37,707 0 0 0 0 $0 $565,605 $0 $0 $0 $0 $565,605 $15110 3,910 0 0 0 1,955 0 1,955 $0 $0 $0 $35,190 $0 $0 $35,190 $9111 46,272 11,568 34,704 0 0 0 0 $416,448 $520,560 $0 $0 $0 $0 $937,008 $2052 24,983 0 24,983 0 0 0 0 $0 $374,751 $0 $0 $0 $0 $374,751 $15113-114 100,111 0 0 100,111 0 0 0 $0 $0 $2,002,220 $0 $0 $0 $2,002,220 $20115 36,867 0 0 0 27,650 9,217 0 $0 $0 $0 $497,705 $41,475 $0 $539,180 $15116 36,867 0 0 0 27,650 9,217 0 $0 $0 $0 $497,705 $41,475 $0 $539,180 $1512 162,335 162,335 0 0 0 0 0 $5,844,060 $0 $0 $0 $0 $0 $5,844,060 $3614 38,947 38,947 0 0 0 0 0 $1,402,092 $0 $0 $0 $0 $0 $1,402,092 $3621 10,172 0 5,086 0 5,086 0 0 $0 $76,290 $0 $91,548 $0 $0 $167,838 $1750 678 0 0 0 339 0 339 $0 $0 $0 $6,102 $0 $0 $6,102 $919 10,000 0 10,000 0 0 0 0 $0 $150,000 $0 $0 $0 $0 $150,000 $15Kneass 11,325 8,494 0 0 0 2,831 0 $305,775 $0 $0 $0 $12,741 $0 $318,516 $28Total 721,569 343,326 181,211 100,111 73,363 21,265 2,294 $12,359,733 $2,718,169 $2,002,220 $1,320,525 $95,691 $0 $18,496,338 $25.63

65 723,827Effective Parking Ratio 0.10

[1] Uses within each building are roughly proportioned, based on Port/ROMA/EPS walk-through of buildings. [2] Rent assumption reflects monthly lease rate of $3.00, which is consistent with typical rents in the area.[3] Rent assumption reflects monthly lease rate of $1.25, which is on the higher end of rents in the area. This rate is slightly above the expected average rent reported by non-profits;

to the extent that an institutional user is found, this rate may be higher.[4] Rent assumption reflects monthly lease rate of $1.67. Due to the unique nature of these users, this assumption is highly speculative.[5] Rent assumption reflects monthly lease rate of $1.50. This amount is consistent with the middle to lower end of advertised lease rates in the area.[6] Rent assumption reflects monthly lease rate of $.38. This amount is based on a parking pro forma which includes a mixture of monthly and daily parkers.

After operating expenses, the net revenue from parking is estimated at about $55 per square foot. This amount is converted into an annual lease payment.Parking tax generated on an annual basis from spaces included in this proforma total $900.

[7] Includes non-revenue generating uses such as public space or Port uses.

Sources: Port of San Francisco; ROMA Design; Economic & Planning Systems

Spaces provided @ 325 Sq.Ft. per space

Annual per sq.ft. rent assumption

RentTotal Sq.Ft. Devoted to Use

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24

Table 10Phasing AssumptionsPier 70 Financial Feasibility Analysis; EPS #17007

Building Use Total 0 1 2 3 4 5 6

Existing Buildings and Structures sq.ft. / %Building 101 Office Type 1 56,268 0 56,268 0 0 0 0 0Building 102 Adaptive Reuse 1 8,424 0 0 8,424 0 0 0 0Building 2 Adaptive Reuse 1 96,804 0 0 0 0 0 0 0Building 104 Office Type 1 37,641 0 0 0 0 0 37,641 0Building 6 Adaptive Reuse 1 37,707 0 0 0 0 0 0 0Knease Adaptive Reuse 1 11,325 0 0 0 0 0 0 0Building 110 Adaptive Reuse 1 3,910 0 0 0 0 0 0 0Building 111 Adaptive Reuse 1 46,272 0 0 0 0 0 0 0Building 52 Adaptive Reuse 1 24,983 0 0 0 0 0 0 0Building 113-114 Adaptive Reuse 1 100,111 0 0 0 0 100,111 0 0Building 115-116 Adaptive Reuse 1 73,734 0 0 0 0 0 0 73,734Building 12 Adaptive Reuse 1 162,335 0 0 0 0 0 0 0Building 14 Adaptive Reuse 1 38,947 0 0 0 0 0 0 0Building 21 Adaptive Reuse 1 10,172 0 0 0 0 0 0 0Building 19 Adaptive Reuse 1 10,000 0 0 0 0 0 0 0Building 50 Adaptive Reuse 1 678 0 0 0 0 0 0 0Park Space Parks/Open Space 1 634,612 215,062 0 0 0 0 0 0TOTAL Building Sq. Ft. Only, Excludes Demo'ed 719,311 0 56,268 8,424 0 100,111 37,641 73,734

New Buildings and Structures sq.ft.Building N8 Biotech Office 1,268,437 0 0 74,614 74,614 74,614 74,614 74,614Building N9 Medical Office 126,844 0 63,422 63,422 0 0 0 0Building N10 Office (General) 1,141,594 0 0 67,153 67,153 67,153 67,153 67,153Infrastructure N1 Structured Parking 560,205 0 0 0 0 0 0 0TOTAL Building and Parking SF 3,097,080 0 63,422 205,188 141,767 141,767 141,767 141,767

[1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratioof 1 space (325 square feet) for every 1,000 square feet of gross building space . [2] For years with parking deficits, surface parking is assumed to be provided.[3] Based on capitalized value.

Source: Economic & Planning Systems, Inc.

Year

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Building Use Total

Existing Buildings and Structures sq.ft. / %Building 101 Office Type 1 56,268Building 102 Adaptive Reuse 1 8,424Building 2 Adaptive Reuse 1 96,804Building 104 Office Type 1 37,641Building 6 Adaptive Reuse 1 37,707Knease Adaptive Reuse 1 11,325Building 110 Adaptive Reuse 1 3,910Building 111 Adaptive Reuse 1 46,272Building 52 Adaptive Reuse 1 24,983Building 113-114 Adaptive Reuse 1 100,111Building 115-116 Adaptive Reuse 1 73,734Building 12 Adaptive Reuse 1 162,335Building 14 Adaptive Reuse 1 38,947Building 21 Adaptive Reuse 1 10,172Building 19 Adaptive Reuse 1 10,000Building 50 Adaptive Reuse 1 678Park Space Parks/Open Space 1 634,612TOTAL Building Sq. Ft. Only, Excludes Demo'ed 719,311

New Buildings and Structures sq.ft.Building N8 Biotech Office 1,268,437Building N9 Medical Office 126,844Building N10 Office (General) 1,141,594Infrastructure N1 Structured Parking 560,205TOTAL Building and Parking SF 3,097,080



7 8 9 10 11 12 13

0 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 0

11,325 0 0 0 0 0 00 0 0 0 3,910 0 00 0 0 46,272 0 0 00 0 0 24,983 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 162,335 00 38,947 0 0 0 0 00 0 10,172 0 0 0 00 0 0 0 0 0 10,0000 0 0 0 678 0 0

167,395 0 0 25,700 0 0 146,36211,325 38,947 10,172 71,255 4,588 162,335 10,000

74,614 74,614 74,614 74,614 74,614 74,614 74,6140 0 0 0 0 0 0

67,153 67,153 67,153 67,153 67,153 67,153 67,1530 0 0 0 0 186,735 0

141,767 141,767 141,767 141,767 141,767 328,502 141,767

Year


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Building Use Total

Existing Buildings and Structures sq.ft. / %Building 101 Office Type 1 56,268Building 102 Adaptive Reuse 1 8,424Building 2 Adaptive Reuse 1 96,804Building 104 Office Type 1 37,641Building 6 Adaptive Reuse 1 37,707Knease Adaptive Reuse 1 11,325Building 110 Adaptive Reuse 1 3,910Building 111 Adaptive Reuse 1 46,272Building 52 Adaptive Reuse 1 24,983Building 113-114 Adaptive Reuse 1 100,111Building 115-116 Adaptive Reuse 1 73,734Building 12 Adaptive Reuse 1 162,335Building 14 Adaptive Reuse 1 38,947Building 21 Adaptive Reuse 1 10,172Building 19 Adaptive Reuse 1 10,000Building 50 Adaptive Reuse 1 678Park Space Parks/Open Space 1 634,612TOTAL Building Sq. Ft. Only, Excludes Demo'ed 719,311

New Buildings and Structures sq.ft.Building N8 Biotech Office 1,268,437Building N9 Medical Office 126,844Building N10 Office (General) 1,141,594Infrastructure N1 Structured Parking 560,205TOTAL Building and Parking SF 3,097,080



14 15 16 17 18 19 20

0 0 0 0 0 0 00 0 0 0 0 0 0

96,804 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 37,707 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 0 0 0 0 0 00 80,093 0 0 0 0 0

96,804 0 0 0 37,707 0 0

74,614 74,614 74,614 74,614 74,614 0 00 0 0 0 0 0 0

67,153 67,153 67,153 67,153 67,153 0 00 186,735 0 186,735 0 0 0

141,767 328,502 141,767 328,502 141,767 0 0

Year


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Item Total (Yrs 0-30) 0 1 2 3 4 5 6

Cumulative Development (sq.ft.)Rehabbed Building Area ( includes some parking sq.ft.) 719,311 0 56,268 64,692 64,692 164,803 202,444 276,178New Buildings (includes some parking sq.ft.) 2,536,875 0 63,422 268,610 410,377 552,143 693,910 835,676Parking Structure 560,205 0 0 0 0 0 0 0Total Development 3,816,391 0 119,690 333,302 475,069 716,946 896,354 1,111,854

Cumulative Parking Parking Demand (spaces) [1] 2,880 0 90 252 359 541 676 839Parking Supply (spaces)

in Rehabbed Buildings 65 0 5 6 6 15 18 25in Vertical Pro Formas 1,146 0 55 170 231 292 353 414in Structured Parking 1,724 0 0 0 0 0 0 0Total Supply (spaces) 2,935 0 60 176 237 307 371 439

(Surface Parking Required) (spaces) [2] 721 0 (31) (76) (122) (234) (305) (400)(Surface Parking Acres Required) (acres) 5.8 0.00 (0.25) (0.61) (0.98) (1.88) (2.45) (3.21)

Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]Building 101 $18,365,875 $0 $18,365,875 $0 $0 $0 $0 $0Building 102 $1,355,702 $0 $0 $1,355,702 $0 $0 $0 $0Building 2 $18,431,482 $0 $0 $0 $0 $0 $0 $0Building 104 $12,286,022 $0 $0 $0 $0 $0 $12,286,022 $0Building 6 $4,914,479 $0 $0 $0 $0 $0 $0 $0Knease $2,887,875 $0 $0 $0 $0 $0 $0 $0Building 110 $270,311 $0 $0 $0 $0 $0 $0 $0Building 111 $8,495,539 $0 $0 $0 $0 $0 $0 $0Building 52 $3,256,118 $0 $0 $0 $0 $0 $0 $0Building 113-114 $18,153,461 $0 $0 $0 $0 $18,153,461 $0 $0Building 115-116 $9,327,965 $0 $0 $0 $0 $0 $0 $9,327,965Building 12 $52,986,144 $0 $0 $0 $0 $0 $0 $0Building 14 $12,712,301 $0 $0 $0 $0 $0 $0 $0Building 21 $1,481,382 $0 $0 $0 $0 $0 $0 $0Building 19 $1,303,333 $0 $0 $0 $0 $0 $0 $0Building 50 $46,872 $0 $0 $0 $0 $0 $0 $0Other Rehabbed Buildings $0 $0 $0 $0 $0 $0 $0 $0

Assessed New Value by Land Use (2009, uninflated dollars) [3]Biotech Office $646,002,828 $0 $0 $38,000,166 $38,000,166 $38,000,166 $38,000,166 $38,000,166Medical Office $51,582,726 $0 $25,791,363 $25,791,363 $0 $0 $0 $0Office (General) $467,769,271 $0 $0 $27,515,839 $27,515,839 $27,515,839 $27,515,839 $27,515,839

TOTAL ASSESSED VALUE $0 $44,157,238 $92,663,071 $65,516,006 $83,669,467 $77,802,028 $74,843,971

[1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratioof 1 space (325 square feet) for every 1,000 square feet of gross building space .

[2] For years with parking deficits, surface parking is assumed to be provided.[3] Based on capitalized value.


Year

$1,331,629,688


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Cumulative Development (sq.ft.)Rehabbed Building Area ( includes some parking sq.ft.) 719,311New Buildings (includes some parking sq.ft.) 2,536,875Parking Structure 560,205Total Development 3,816,391Cumulative Parking Parking Demand (spaces) [1] 2,880Parking Supply (spaces)

in Rehabbed Buildings 65in Vertical Pro Formas 1,146in Structured Parking 1,724Total Supply (spaces) 2,935

(Surface Parking Required) (spaces) [2] 721(Surface Parking Acres Required) (acres) 5.8

Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]Building 101 $18,365,875Building 102 $1,355,702Building 2 $18,431,482Building 104 $12,286,022Building 6 $4,914,479Knease $2,887,875Building 110 $270,311Building 111 $8,495,539Building 52 $3,256,118Building 113-114 $18,153,461Building 115-116 $9,327,965Building 12 $52,986,144Building 14 $12,712,301Building 21 $1,481,382Building 19 $1,303,333Building 50 $46,872Other Rehabbed Buildings $0

Assessed New Value by Land Use (2009, uninflated dollars) [3]Biotech Office $646,002,828Medical Office $51,582,726Office (General) $467,769,271

TOTAL ASSESSED VALUE




$1,331,629,688

7 8 9 10 11 12 13

287,503 326,450 336,622 407,877 412,465 574,800 584,800977,443 1,119,209 1,260,976 1,402,742 1,544,509 1,686,275 1,828,042

0 0 0 0 0 186,735 186,7351,264,946 1,445,659 1,597,598 1,810,619 1,956,974 2,447,811 2,599,577

955 1,091 1,206 1,367 1,477 1,847 1,962

26 30 31 37 38 52 53475 536 597 658 719 780 841

0 0 0 0 0 575 575501 566 628 695 756 1,407 1,469

(454) (525) (578) (672) (721) (441) (493)(3.64) (4.22) (4.65) (5.40) (5.79) (3.54) (3.96)

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$2,887,875 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $270,311 $0 $0$0 $0 $0 $8,495,539 $0 $0 $0$0 $0 $0 $3,256,118 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $52,986,144 $0$0 $12,712,301 $0 $0 $0 $0 $0$0 $0 $1,481,382 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $1,303,333$0 $0 $0 $0 $46,872 $0 $0$0 $0 $0 $0 $0 $0 $0

$38,000,166 $38,000,166 $38,000,166 $38,000,166 $38,000,166 $38,000,166 $38,000,166$0 $0 $0 $0 $0 $0 $0

$27,515,839 $27,515,839 $27,515,839 $27,515,839 $27,515,839 $27,515,839 $27,515,839

$68,403,881 $78,228,307 $66,997,388 $77,267,663 $65,833,190 $118,502,150 $66,819,339

Year


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29



Cumulative Development (sq.ft.)Rehabbed Building Area ( includes some parking sq.ft.) 719,311New Buildings (includes some parking sq.ft.) 2,536,875Parking Structure 560,205Total Development 3,816,391Cumulative Parking Parking Demand (spaces) [1] 2,880Parking Supply (spaces)

in Rehabbed Buildings 65in Vertical Pro Formas 1,146in Structured Parking 1,724Total Supply (spaces) 2,935

(Surface Parking Required) (spaces) [2] 721(Surface Parking Acres Required) (acres) 5.8

Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]Building 101 $18,365,875Building 102 $1,355,702Building 2 $18,431,482Building 104 $12,286,022Building 6 $4,914,479Knease $2,887,875Building 110 $270,311Building 111 $8,495,539Building 52 $3,256,118Building 113-114 $18,153,461Building 115-116 $9,327,965Building 12 $52,986,144Building 14 $12,712,301Building 21 $1,481,382Building 19 $1,303,333Building 50 $46,872Other Rehabbed Buildings $0

Assessed New Value by Land Use (2009, uninflated dollars) [3]Biotech Office $646,002,828Medical Office $51,582,726Office (General) $467,769,271

TOTAL ASSESSED VALUE




$1,331,629,688

14 15 16 17 18 19 20

681,604 681,604 681,604 681,604 719,311 719,311 719,3111,969,808 2,111,575 2,253,342 2,395,108 2,536,875 2,536,875 2,536,875

186,735 373,470 373,470 560,205 560,205 560,205 560,2052,838,148 3,166,649 3,308,416 3,636,917 3,816,391 3,816,391 3,816,391

2,142 2,390 2,497 2,745 2,880 2,880 2,880

62 62 62 62 65 65 65902 963 1,024 1,085 1,146 1,146 1,146575 1,149 1,149 1,724 1,724 1,724 1,724

1,538 2,174 2,235 2,870 2,935 2,935 2,935(604) (216) (262) 0 0 0 0

(4.85) (1.74) (2.11) 0.00 0.00 0.00 0.00

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$18,431,482 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $4,914,479 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$38,000,166 $38,000,166 $38,000,166 $38,000,166 $38,000,166 $0 $0$0 $0 $0 $0 $0 $0 $0

$27,515,839 $27,515,839 $27,515,839 $27,515,839 $27,515,839 $0 $0

$83,947,487 $65,516,006 $65,516,006 $65,516,006 $70,430,485 $0 $0

Year


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30

Table 11Infrastructure Financing District Bond and Debt Service CalculationsPier 70 Financial Feasibility Analysis; EPS #17007

Item NPV (at 6%) Total 0 1 2 3 4 5 6 7

Base Value [1] $0 $0 $0 $0 $0 $0 $0 $0 $0 $0New Value [2] $7,709,740,907 $17,766,365,969 $0 $0 $46,846,414 $149,038,782 $225,758,400 $327,269,412 $426,714,490 $527,297,424AV Increment [3] $7,709,740,907 $17,766,365,969 $0 $0 $46,846,414 $149,038,782 $225,758,400 $327,269,412 $426,714,490 $527,297,424

Gross TI [4] $77,097,028 $177,663,000 $0 $0 $468,000 $1,490,000 $2,258,000 $3,273,000 $4,267,000 $5,273,000

65% Share of Tax Increment$50,113,068 $115,480,950 $0 $0 $304,200 $968,500 $1,467,700 $2,127,450 $2,773,550 $3,427,450

$40,090,454 $92,384,760 $0 $0 $243,360 $774,800 $1,174,160 $1,701,960 $2,218,840 $2,741,960Net Bond Payments $5,540,338 $11,120,200 $0 $0 $243,360 $531,440 $399,360 $527,800 $516,880 $523,120Pay As You Go revenues [5] $10,623,970 $23,096,190 $0 $60,840 $193,700 $293,540 $425,490 $554,710 $685,490

$71,945,109 $153,067,675 $0 $0 $0 $3,349,809 $7,315,182 $5,497,123 $7,265,078 $7,114,766($7,194,511) ($15,306,768) $0 $0 $0 ($334,981) ($731,518) ($549,712) ($726,508) ($711,477)

Net Bond Amount [6] $64,750,598 $137,760,908 $0 $0 $0 $3,014,828 $6,583,664 $4,947,411 $6,538,570 $6,403,289

Contingent: 25% Share of Tax Increment$19,505,548 $44,948,739 $0 $0 $118,404 $376,970 $571,274 $828,069 $1,079,551 $1,334,069

$15,604,438 $35,958,991 $0 $0 $94,723 $301,576 $457,019 $662,455 $863,641 $1,067,255Net Bond Payments $2,156,470 $4,328,324 $0 $0 $94,723 $206,853 $155,443 $205,436 $201,186 $203,614Pay As You Go revenues [5] $4,135,176 $8,989,748 $0 $23,681 $75,394 $114,255 $165,614 $215,910 $266,814

$28,003,250 $59,578,649 $0 $0 $0 $1,303,849 $2,847,294 $2,139,649 $2,827,792 $2,769,286($2,800,325) ($5,957,865) $0 $0 $0 ($130,385) ($284,729) ($213,965) ($282,779) ($276,929)

Net Bond Amount [6] $25,202,925 $53,620,784 $0 $0 $0 $1,173,464 $2,562,564 $1,925,684 $2,545,013 $2,492,357

[1] Assumed to be 0.[2] Includes value estimated by capitalizing net operating income for new uses and rehabilitated buildings. Value is shown

through project build-out.[3] Difference between new and base values.[4][5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.[6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year terms.

No further bonds are assumed to be issued once value stabilizes.Source: Economic & Planning Systems, Inc.

(Less) Issuance Costs @ 10%

Gross tax increment is calculated at 1% of the AV increment.

Additional Share Available for Bond (25.3%)

Available for Debt Service, @1.25 Coverage

Gross Bond Amt.,30-yr. term @ 6.0%

Share Available for Bond (65%)


Gross Bond Amt., 30-yr. term @ 6.0%(Less) Issuance Costs @ 10%


Page 1 of 3

31

Table 11Infrastructure Financing District Bond and Debt Service CalculationPier 70 Financial Feasibility Analysis; EPS #17007

Item NPV (at 6%) Total

Base Value [1] $0 $0New Value [2] $7,709,740,907 $17,766,365,969AV Increment [3] $7,709,740,907 $17,766,365,969

Gross TI [4] $77,097,028 $177,663,000

65% Share of Tax Increment$50,113,068 $115,480,950

$40,090,454 $92,384,760Net Bond Payments $5,540,338 $11,120,200Pay As You Go revenues [5] $10,623,970 $23,096,190

$71,945,109 $153,067,675($7,194,511) ($15,306,768)

Net Bond Amount [6] $64,750,598 $137,760,908

Contingent: 25% Share of Tax Increment$19,505,548 $44,948,739


$28,003,250 $59,578,649($2,800,325) ($5,957,865)

Net Bond Amount [6] $25,202,925 $53,620,784(Less) Issuance Costs @ 10%







8 9 10 11 12 13 14

$0 $0 $0 $0 $0 $0 $0$624,495,363 $739,055,466 $843,875,463 $955,949,675 $1,068,931,055 $1,264,334,078 $1,390,691,006$624,495,363 $739,055,466 $843,875,463 $955,949,675 $1,068,931,055 $1,264,334,078 $1,390,691,006

$6,245,000 $7,391,000 $8,439,000 $9,559,000 $10,689,000 $12,643,000 $13,907,000

$4,059,250 $4,804,150 $5,485,350 $6,213,350 $6,947,850 $8,217,950 $9,039,550

$3,247,400 $3,843,320 $4,388,280 $4,970,680 $5,558,280 $6,574,360 $7,231,640$505,440 $595,920 $544,960 $582,400 $587,600 $1,016,080 $657,280$811,850 $960,830 $1,097,070 $1,242,670 $1,389,570 $1,643,590 $1,807,910

$7,200,658 $6,957,296 $8,202,738 $7,501,282 $8,016,638 $8,088,215 $13,986,170($720,066) ($695,730) ($820,274) ($750,128) ($801,664) ($808,821) ($1,398,617)

$6,480,593 $6,261,567 $7,382,464 $6,751,154 $7,214,974 $7,279,393 $12,587,553

$1,579,985 $1,869,923 $2,135,067 $2,418,427 $2,704,317 $3,198,679 $3,518,471

$1,263,988 $1,495,938 $1,708,054 $1,934,742 $2,163,454 $2,558,943 $2,814,777$196,733 $231,950 $212,115 $226,688 $228,712 $395,490 $255,834$315,997 $373,985 $427,013 $483,685 $540,863 $639,736 $703,694

$2,802,718 $2,707,994 $3,192,758 $2,919,730 $3,120,322 $3,148,182 $5,443,848($280,272) ($270,799) ($319,276) ($291,973) ($312,032) ($314,818) ($544,385)

$2,522,446 $2,437,194 $2,873,482 $2,627,757 $2,808,290 $2,833,364 $4,899,463


through project build-out.[3] Difference between new and base values.[4][5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.[6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year




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Table 11Infrastructure Financing District Bond and Debt Service CalculationPier 70 Financial Feasibility Analysis; EPS #17007

Item NPV (at 6%) Total

Base Value [1] $0 $0New Value [2] $7,709,740,907 $17,766,365,969AV Increment [3] $7,709,740,907 $17,766,365,969

Gross TI [4] $77,097,028 $177,663,000

65% Share of Tax Increment$50,113,068 $115,480,950


$71,945,109 $153,067,675($7,194,511) ($15,306,768)

Net Bond Amount [6] $64,750,598 $137,760,908

Contingent: 25% Share of Tax Increment$19,505,548 $44,948,739


$28,003,250 $59,578,649($2,800,325) ($5,957,865)

Net Bond Amount [6] $25,202,925 $53,620,784(Less) Issuance Costs @ 10%







15 16 17 18 19 20 21

$0 $0 $0 $0 $0 $0 $0$1,549,292,276 $1,685,412,078 $1,827,408,294 $1,975,493,075 $2,138,503,218 $0 $0$1,549,292,276 $1,685,412,078 $1,827,408,294 $1,975,493,075 $2,138,503,218 $0 $0

$15,493,000 $16,854,000 $18,274,000 $19,755,000 $21,385,000 $0 $0

$10,070,450 $10,955,100 $11,878,100 $12,840,750 $13,900,250 $0 $0

$8,056,360 $8,764,080 $9,502,480 $10,272,600 $11,120,200 $0 $0$824,720 $707,720 $738,400 $770,120 $847,600 $0 $0

$2,014,090 $2,191,020 $2,375,620 $2,568,150 $2,780,050 $0 $0

$9,047,348 $11,352,132 $9,741,646 $10,163,951 $10,600,572 $11,667,071 $0($904,735) ($1,135,213) ($974,165) ($1,016,395) ($1,060,057) ($1,166,707) $0

$8,142,613 $10,216,918 $8,767,482 $9,147,556 $9,540,515 $10,500,364 $0

$3,919,729 $4,264,062 $4,623,322 $4,998,015 $5,410,405 $0 $0

$3,135,783 $3,411,250 $3,698,658 $3,998,412 $4,328,324 $0 $0$321,006 $275,466 $287,408 $299,754 $329,912 $0 $0$783,946 $852,812 $924,664 $999,603 $1,082,081 $0 $0

$3,521,506 $4,418,599 $3,791,748 $3,956,123 $4,126,069 $4,541,183 $0($352,151) ($441,860) ($379,175) ($395,612) ($412,607) ($454,118) $0

$3,169,356 $3,976,739 $3,412,574 $3,560,510 $3,713,462 $4,087,065 $0


through project build-out.[3] Difference between new and base values.[4][5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.[6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year terms.




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Table 12Mello-Roos CFD Bond Debt Service Calculations (Nominal $)Pier 70 Financial Feasibility Analysis; EPS #17007

Item Total 0 1 2 3 4 5 6 7

Cumulative Assessed Value (annual growth included) [1] a - $0 $0 $27,362,057 $127,683,325 $203,975,834 $284,006,357 $367,916,022 $455,850,765

Annual add-on-tax payment available, @ 0.65% [2] b=a*0.65% - $0 $0 $177,853 $829,942 $1,325,843 $1,846,041 $2,391,454 $2,963,030

Debt to Coverage Ratio @ 1.1 c=b/1.1 $0 $0 $161,685 $754,492 $1,205,312 $1,678,219 $2,174,049 $2,693,664

(Less) Delinquency @ 12% d=-(c*12%) ($27,573,380) $0 $0 ($19,402) ($90,539) ($144,637) ($201,386) ($260,886) ($323,240)

(Less) Administration @ 0.5% e=-(c*0.5%) ($1,148,891) $0 $0 ($808) ($3,772) ($6,027) ($8,391) ($10,870) ($13,468)

Net Annual Payments Available f=c+d+e $201,055,894 $0 $0 $141,474 $660,181 $1,054,648 $1,468,442 $1,902,293 $2,356,956

Net Incremental Bond Payments g - $0 $0 $141,474 $518,707 $394,467 $413,794 $433,851 $454,663

Cumulative Net Incremental Bond Payments h $0 $141,474 $660,181 $1,054,648 $1,468,442 $1,902,293 $2,356,956

Gross Bond Amt.,30-yr. term,@ 6.5%i=bond value of prior year"g" row $127,303,467 $0 $0 $0 $1,847,467 $6,773,621 $5,151,216 $5,403,604 $5,665,521

(Less) Issuance Costs @ 5% j=i*5% ($6,365,173) $0 $0 $0 ($92,373) ($338,681) ($257,561) ($270,180) ($283,276)

Net Bond Amount [3] k=i+j $120,938,294 $0 $0 $0 $1,755,093 $6,434,940 $4,893,655 $5,133,424 $5,382,245

Discount on Lease Revs. @ 75% [4] l=c*75% $150,587,276 $0 $0 $0 $121,264 $565,869 $903,984 $1,258,665 $1,630,537

[2] Between 0.50% and 0.75% are standard, add-on tax rates which the market is assumed to partially bear.


[1] Includes assessed value of new development only. 2% statutory growth applied annually to development, once built. 3% annual growth applied to reflect market growth during build-out.

[3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity. This is not meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Net bond is assumed to be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value stabilizes.

[4] It is assumed that a portion of this add-on tax will be discounted from total building and land lease revenues. For the purposes of analysis, 75% of the add-on tax is assumed to be discounted from lease payments.


Page 1 of 3

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Item Total

Cumulative Assessed Value (annual growth included) [1] a -

Annual add-on-tax payment available, @ 0.65% [2] b=a*0.65% -

Debt to Coverage Ratio @ 1.1 c=b/1.1

(Less) Delinquency @ 12% d=-(c*12%) ($27,573,380)

(Less) Administration @ 0.5% e=-(c*0.5%) ($1,148,891)

Net Annual Payments Available f=c+d+e $201,055,894

Net Incremental Bond Payments g -

Cumulative Net Incremental Bond Payments h

Gross Bond Amt.,30-yr. term,@ 6.5%i=bond value of prior year"g" row $127,303,467

(Less) Issuance Costs @ 5% j=i*5% ($6,365,173)

Net Bond Amount [3] k=i+j $120,938,294

Discount on Lease Revs. @ 75% [4] l=c*75% $150,587,276

8 9 10 11 12 13 14

$547,961,497 $644,404,254 $745,340,373 $850,936,654 $961,365,546 $1,076,805,320 $1,197,440,264

$3,561,750 $4,188,628 $4,844,712 $5,531,088 $6,248,876 $6,999,235 $7,783,362

$3,237,954 $3,807,843 $4,404,284 $5,028,262 $5,680,796 $6,362,941 $7,075,783

($388,555) ($456,941) ($528,514) ($603,391) ($681,696) ($763,553) ($849,094)

($16,190) ($19,039) ($22,021) ($25,141) ($28,404) ($31,815) ($35,379)

$2,833,210 $3,331,863 $3,853,749 $4,399,729 $4,970,697 $5,567,573 $6,191,310

$476,254 $498,653 $521,886 $545,981 $570,968 $596,876 $623,737

$2,833,210 $3,331,863 $3,853,749 $4,399,729 $4,970,697 $5,567,573 $6,191,310

$5,937,291 $6,219,251 $6,511,747 $6,815,135 $7,129,786 $7,456,080 $7,794,412

($296,865) ($310,963) ($325,587) ($340,757) ($356,489) ($372,804) ($389,721)

$5,640,427 $5,908,289 $6,186,159 $6,474,378 $6,773,297 $7,083,276 $7,404,691

$2,020,248 $2,428,466 $2,855,882 $3,303,213 $3,771,197 $4,260,597 $4,772,205




[3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity. This is not meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Netbond is assumed to be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value stabilizes.



Page 2 of 3

35


Item Total

Cumulative Assessed Value (annual growth included) [1] a -

Annual add-on-tax payment available, @ 0.65% [2] b=a*0.65% -

Debt to Coverage Ratio @ 1.1 c=b/1.1

(Less) Delinquency @ 12% d=-(c*12%) ($27,573,380)

(Less) Administration @ 0.5% e=-(c*0.5%) ($1,148,891)

Net Annual Payments Available f=c+d+e $201,055,894

Net Incremental Bond Payments g -

Cumulative Net Incremental Bond Payments h

Gross Bond Amt.,30-yr. term,@ 6.5%i=bond value of prior year"g" row $127,303,467

(Less) Issuance Costs @ 5% j=i*5% ($6,365,173)

Net Bond Amount [3] k=i+j $120,938,294

Discount on Lease Revs. @ 75% [4] l=c*75% $150,587,276

15 16 17 18 19 20 21

$1,323,460,871 $1,455,064,045 $1,592,453,301 $1,735,838,982 $1,885,438,474 $1,923,147,243 $1,961,610,188

$8,602,496 $9,457,916 $10,350,946 $11,282,953 $12,255,350 $12,500,457 $12,750,466

$7,820,451 $8,598,106 $9,409,951 $10,257,230 $11,141,227 $11,364,052 $11,591,333

($938,454) ($1,031,773) ($1,129,194) ($1,230,868) ($1,336,947) ($1,363,686) ($1,390,960)

($39,102) ($42,991) ($47,050) ($51,286) ($55,706) ($56,820) ($57,957)

$6,842,894 $7,523,343 $8,233,707 $8,975,077 $9,748,574 $9,943,545 $10,142,416

$651,584 $680,448 $710,365 $741,369 $773,497 $0 $0

$6,842,894 $7,523,343 $8,233,707 $8,975,077 $9,748,574 $9,748,574 $9,748,574

$8,145,186 $8,508,822 $8,885,753 $9,276,425 $9,681,299 $10,100,852 $0

($407,259) ($425,441) ($444,288) ($463,821) ($484,065) ($505,043) $0

$7,737,926 $8,083,381 $8,441,465 $8,812,604 $9,197,234 $9,595,809 $0

$5,306,838 $5,865,338 $6,448,579 $7,057,463 $7,692,923 $8,355,921 $8,355,921




[3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity. This is not meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Net bond is assumed to be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value stabilizes.



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Table 13New Payroll Tax CalculationPier 70 Financial Feasibility Analysis; EPS #17007

Total at Year EndingProject Item Buildout 0 1 2 3 4 5 6

Existing Buildings and Structures 719,311 0 56,268 8,424 0 100,111 37,641 73,734

New Buildings and StructuresBiotech Office 1,268,437 0 0 74,614 74,614 74,614 74,614 74,614Medical Office 126,844 0 63,422 63,422 0 0 0 0General Office 1,141,594 0 0 67,153 67,153 67,153 67,153 67,153

Total New Buildings and Structures 2,536,875 0 63,422 205,188 141,767 141,767 141,767 141,767

New Employment per year [1]Rehab. Buildings and Structures 400 sf per employee 1,798 0 141 21 0 250 94 184

(less) existing employment [2] 5% of new employment -90 0 -7 -1 0 -13 -5 -9Biotech Office 425 sf per employee 2,985 0 0 176 176 176 176 176Medical Office 350 sf per employee 362 0 181 181 0 0 0 0General Office 315 sf per employee 3,624 0 0 213 213 213 213 213

Total Incremental Employment 8,679 0 315 590 389 627 478 564

New Payroll (2009$)Rehab. Buildings and Structures [3] $39,400 a year $70,852,134 $0 $5,542,398 $829,764 $0 $9,860,934 $3,707,639 $7,262,799Biotech Office [4] $76,200 a year $227,423,342 $0 $0 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $13,377,844Medical Office [5] $60,200 a year $21,817,121 $0 $10,908,561 $10,908,561 $0 $0 $0 $0General Office [6] $58,200 a year $210,922,998 $0 $0 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $12,407,235

Total Payroll $531,015,594 $0 $16,450,959 $37,523,403 $25,785,079 $35,646,012 $29,492,717 $33,047,878

New Payroll Subject to Payroll TaxRehab. Buildings and Structures [7] 80% 80% 80% 80% 80% 80% 80%Biotech Office [8] 50% 50% 50% 50% 50% 50% 50%Medical Office [7] 80% 80% 80% 80% 80% 80% 80%General Office [7] 80% 80% 80% 80% 80% 80% 80%

Net Payroll Subject to Payroll Tax (2009$) $278,965,869 $0 $13,160,767 $26,005,370 $16,614,710 $24,503,457 $19,580,821 $22,424,949

New Payroll Tax Revenue (2009$) 1.5% of net payroll $4,184,488 $0 $197,412 $390,081 $249,221 $367,552 $293,712 $336,374Cumulative Payroll Tax (2009$) $0 $197,412 $587,492 $836,713 $1,204,265 $1,497,977 $1,834,351

[1] Square feet per employee take into account the factors used in the Mission Bay SEIR. New office space is assumed to have higher-density employment ratio because of more modernized and efficient floor plans and design relative to existing building inventory.

[2] Proposition D language notes that the revenue available will be incremental payroll tax revenues. This table includes several assumptions which render the calculation a conservative one. [3] Based on the Bureau of Labor Statistics (BLS) data for the Office and Administrative Support Occupations' annual wage average in the San Francisco-Oakland-Fremont MSA (SF-Oak-Frem).[4] Based on the BLS for the Life, Physical, and Social Science Occupations' annual wage average in the SF-Oak-Frem.[5] Based on the BLS data for the Healthcare Practitioner and Technical Occupations and Healthcare Support sectors' annual wage average in the SF-Oak-Frem.[6] Based on the BLS data for the Office and Administrative Support, Business and Financial Operations, Computer and Mathematical Science, Architecture and Engineering, and

Legal sectors' annual wage weighted average in the SF-Oak-Frem.[7] 80% of the overall payroll is assumed to be subject to payroll tax as clean energy technology sector, jobs partially located in other jurisdictions, and jobs with incomes below the threshold for the

payroll tax are exempt from the payroll tax ordinance. [8] The biotech industry is exempt from the payroll tax ordinance for the first 7 years a company is located in San Francisco. For the purposes of modeling the amount of payroll taxes biotech companies

at Pier 70 may contribute, a payroll tax "discount" of 50% is applied to the first 7 years of the program (this assumes that half of the biotech companies at Pier 70 will be exempt from the payroll tax). This discount is decreased to 30% for the remainder of the project buildout (with a 70% payroll tax payment rate), to account for tenants exhausting their 7 year exemption. The total payroll tax paidby biotech companies is lower than other uses based on the assumption that companies may move to the site while within their 7 year exemption period.

Source: BLS, San Francisco Payroll Tax Ordinance, Economic & Planning Systems, Inc.

Assumption


37



Existing Buildings and Structures 719,311 11,325 38,947 10,172 71,255 4,588 162,335 10,000

New Buildings and StructuresBiotech Office 1,268,437 74,614 74,614 74,614 74,614 74,614 74,614 74,614Medical Office 126,844 0 0 0 0 0 0 0General Office 1,141,594 67,153 67,153 67,153 67,153 67,153 67,153 67,153

Total New Buildings and Structures 2,536,875 141,767 141,767 141,767 141,767 141,767 141,767 141,767


(less) existing employment [2] 5% of new employment -90 -1 -5 -1 -9 -1 -20 -1Biotech Office 425 sf per employee 2,985 176 176 176 176 176 176 176Medical Office 350 sf per employee 362 0 0 0 0 0 0 0General Office 315 sf per employee 3,624 213 213 213 213 213 213 213


New Payroll (2009$)Rehab. Buildings and Structures [3] $39,400 a year $70,852,134 $1,115,513 $3,836,280 $1,001,942 $7,018,618 $451,918 $15,989,998 $985,000Biotech Office [4] $76,200 a year $227,423,342 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $13,377,844Medical Office [5] $60,200 a year $21,817,121 $0 $0 $0 $0 $0 $0 $0General Office [6] $58,200 a year $210,922,998 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $12,407,235

Total Payroll $531,015,594 $26,900,591 $29,621,358 $26,787,021 $32,803,696 $26,236,997 $41,775,076 $26,770,079


Net Payroll Subject to Payroll Tax (2009$) $278,965,869 $17,507,120 $22,359,302 $20,091,832 $24,905,173 $19,651,813 $32,082,277 $20,078,279

New Payroll Tax Revenue (2009$) 1.5% of net payroll $4,184,488 $262,607 $335,390 $301,377 $373,578 $294,777 $481,234 $301,174Cumulative Payroll Tax (2009$) $2,096,958 $2,432,347 $2,733,725 $3,107,303 $3,402,080 $3,883,314 $4,184,488







Assumption


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Existing Buildings and Structures 719,311 96,804 0 0 0 37,707 0 0

New Buildings and StructuresBiotech Office 1,268,437 74,614 74,614 74,614 74,614 74,614 0 0Medical Office 126,844 0 0 0 0 0 0 0General Office 1,141,594 67,153 67,153 67,153 67,153 67,153 0 0

Total New Buildings and Structures 2,536,875 141,767 141,767 141,767 141,767 141,767 0 0


(less) existing employment [2] 5% of new employment -90 -12 0 0 0 -5 0 0Biotech Office 425 sf per employee 2,985 176 176 176 176 176 0 0Medical Office 350 sf per employee 362 0 0 0 0 0 0 0General Office 315 sf per employee 3,624 213 213 213 213 213 0 0


New Payroll (2009$)Rehab. Buildings and Structures [3] $39,400 a year $70,852,134 $9,535,194 $0 $0 $0 $3,714,140 $0 $0Biotech Office [4] $76,200 a year $227,423,342 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $13,377,844 $0 $0Medical Office [5] $60,200 a year $21,817,121 $0 $0 $0 $0 $0 $0 $0General Office [6] $58,200 a year $210,922,998 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $12,407,235 $0 $0

Total Payroll $531,015,594 $35,320,273 $25,785,079 $25,785,079 $25,785,079 $29,499,218 $0 $0


Net Payroll Subject to Payroll Tax (2009$) $278,965,869 $26,918,434 $19,290,279 $19,290,279 $19,290,279 $22,261,590 $0 $0

New Payroll Tax Revenue (2009$) 1.5% of net payroll $4,184,488 $403,777 $289,354 $289,354 $289,354 $333,924 $0 $0Cumulative Payroll Tax (2009$) $4,588,265 $4,877,619 $5,166,973 $5,456,327 $5,790,251 $5,790,251 $5,790,251







Assumption


39

Table 14Proposition D Revenues (nominal $)Pier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-20) 0 1 2 3 4 5 6

Proposition D [1]Payroll Tax [2] 75% of payroll tax $74,351,358 $0 $152,500 $467,453 $685,724 $1,016,558 $1,302,424 $1,642,733TOT 75% of TOT revenue $0 $0 $0 $0 $0 $0 $0 $0

Total $74,351,358 $0 $152,500 $467,453 $685,724 $1,016,558 $1,302,424 $1,642,733

(Less) Issuance Cost @ 5.0% ($3,717,568) $0 ($7,625) ($23,373) ($34,286) ($50,828) ($65,121) ($82,137)Net Annual Payments Available $70,633,790 $0 $144,875 $444,080 $651,438 $965,730 $1,237,303 $1,560,597

$48,678,446 $0 $0 $0 $0 $48,678,446 $0

[1] Proposition D is a City charter amendment passed by voters in 2008 which, in part, allows the Port to use net payroll taxes generated at Pier 70 improvements at the site, as described in the proposition. [2] See Table 13 for details on employment projections.[3] Assumed to be bonded against 75% of revenues generated between year 5 and 25.

Formatting indicates year selected (for modeling purposes) in which a 20-year bond may be issues based on Proposition D revenues.


Net Bond Amt., 20-yr. term @ 6.0% [3]

FactorYear


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5. COSTS

The development costs included in the financial feasibility analysis encompass the full suite of improvements necessary to support new development, rehabilitate buildings, and provide a high-level of public amenities. The costs include site preparation, environmental remediation, infrastructure (new streets and utilities), parks, pier and wharf improvements, and historic rehabilitation. All of the cost estimates include a factor for soft costs including planning, entitlement and contingency.

S i tework a nd Water f ron t Improvements

Sitework and waterfront improvement expenditures are related to demolition, new infrastructure, environmental remediation, parks and open space, and piers and wharfs improvements. These cost estimates are based on a number of sources:

• Demolition. A small amount (170,000 square feet) of existing square footage is expected to be demolished. Demolition costs assume $25 in costs per building square foot. These costs are expected to be incurred relatively early in the cash flow, in years 2 through 4.

• Infrastructure. In order to support the development intensity envisioned for Pier 70, new infrastructure is needed. New streets are needed to provide access into the site and circulation among its destination points. To provide this site access and circulation, 18th, 19th and 22nd Streets are extended east onto the Pier 70 site while three new north-south streets will provide internal circulation and access to potential future development at the Mirant Potrero Plant site. In addition, 20th Street will be extended east to the Bay. New utilities including power, water, and sewer are also needed to support the site’s development. The estimated $46 million in costs for infrastructure for the site is estimated based on Mission Bay infrastructure costs which averaged $5,200 per linear feet of roadway. About two-thirds of the infrastructures costs are modeled early in the cash flow, in years 0 through 4. The remaining one-third is spread out through year 9.

• Parking structure. Costs to develop required separate parking structures are based on an estimated $25,000 per parking space.

• Environmental remediation. Environmental remediation is in several places in the cost estimate. The line item in the cost tables is for the site remediation for development sites and is included at $15 million which is then increased to include soft costs. The park costs include related remediation. Treadwell & Rollo estimated costs and quantities for a range of potential soil and groundwater remediation scenarios, ranging from "low" to "high" extent of remediation required, and probability-weighted by the likelihood that we will implement various remediation measures. Those costs are estimated at $19 million for development sites and $9 million for park sites. Building rehabilitation costs ($350 million) include $45 million for abatement of hazardous building materials such as lead-based paint and asbestos. In total, before soft costs, the model includes $66 million of costs to address hazardous materials.



• Parks. Given the intensity of development envisioned at Pier 70 and the existing need for parks and open space in the Central Waterfront area of the City, Crane Cove Park, Slipway Park, and the plazas and courtyards located throughout the land use plan will provide an important amenity to employees and residents in the area. Costs for development of these spaces are estimated including remediation, site work, restoration of the historic cranes at Crane Cove Park, and an array of park features. Costs to develop parks are estimated at $1.5 million per acre with an additional $1 million in expenditures included for restoration of the cranes at Crane Cove Park. These costs were based on recently constructed Port of Oakland waterfront park projects at Union Point and the Cryer Boat Works sites.

Roughly half of the costs of Crane Cove Park are incurred in year 1 using the Park Bond funds available. The remainder of the costs of that park is included in year 7. Other park costs are incurred in years 10, 13, and 15.

• Plazas/Open Space. The development pads include areas of plazas and open space. These would be built as part of the development of each site with the sub-developer of the site incurring these costs, rather than the Master Developer. The cost of this open space is reflected in the vertical development proposals.

• Piers/Wharfs. Expenditures totaling $45 million are included in the plan to stabilize and reconstruct portions of the old piers and wharfs at the site. This estimate is based on the Port’s 10-Year Capital Plan Fiscal Year 2008-2017 Update. These costs are projected to occur largely evenly from years 11 through buildout.

Rehab i l i t a t i on and Adapt i ve Reuse

The rehabilitation and adaptive reuse of historic structures is one of the primary goals of the Preferred Master Plan. Using the adaptive reuse program summarized in Table 9 to define the needed upgrades, the consultant team (architects, engineers, and cost estimators) and Port staff developed costs including historic preservation, seismic strengthening, mechanical and electrical upgrades, other architectural work, and soft costs (planning, entitlement, and contingency). These costs were based on field investigations and assessments of existing conditions as well as expected scope of rehabilitation. For example, where appropriate, the team identified the magnitude of new mezzanines to be added to buildings and included that in the cost program and in the projections of revenues. The detail of the rehabilitation program and costs are documented in the Conception Estimate of Probable Construction Cost Based on Assessment of Building Conditions (Condition Survey Evaluation; July 3, 2008).

Costs estimates were based on the building conditions as investigated in 2008. Costs are escalated at a rate of 3 percent per year to reflect construction cost inflation for the year in which the rehab occurs. An additional cost increase factor of 1 percent per year was included to reflect the fact that the costs of rehabilitating these buildings will increase faster than inflation because of deterioration. One means to reduce the costs of historic rehabilitation may be early investments in stabilization and weather proofing to forestall deterioration.

Building rehabilitation costs along with projected revenues by building and estimated historic tax credits are shown in Table 15. The table calculates, in most cases, a shortfall between capitalized revenues and rehabilitation costs. Table 16 arrays the feasibility shortfall in a cash



flow, illustrating when particular buildings are shown to be rehabilitated. As shown, roughly one building per year is rehabilitated during years 1 through 18 with a priority on the 20th Street corridor. In the final year of the cash flow used for the NPV and IRR calculations, the reversion value of the ground lease and the rehabilitated buildings is included. This is estimated at the capitalized value of the rehabilitated buildings annual lease revenues plus the capitalized value of the annual ground lease value for new development. This assumes that the master developer entity may sell its interest in the site and realize the residual value of the asset in year 30.

Ongo ing Cos ts

Two ongoing costs are included in the annual cash flow projections: environmental remediation monitoring and rent payments to the Port of San Francisco. Ongoing environmental monitoring (e.g., ground water monitoring) and reporting is likely to be required as part of the final remediation action plan and is estimated at $200,000 per year starting after the remediation program is completed.

Rent to the Port of San Francisco is projected at $2.9 million per year—equivalent to the current interim income from the site, excluding the ship repair leasehold. The terms of Proposition D require the Port to demonstrate that even with investing new lease revenue and property tax increment from the site into the project it requires additional public funding. It is likely that final development agreement between the developer and the Port will have a more complex rent structure than modeled herein.

The land lease and building rent projects are after the expenses of running the buildings. No assumptions have been made about the ongoing costs of maintaining the parks and infrastructure; either a community services district would fund these or they would be maintained by the Port or the City.

Cos ts Exc luded f rom P ie r 70 Feas ib i l i t y Ana lys i s

The following costs were not included in the project pro forma:

• Any off-site costs for infrastructure or transportation systems beyond those that would be supported by impact fees included in the project development cost pro formas. For example, no sewer system expansion is expected as a new pump station was built in the 1990s. Nearby roadway improvements are part of the City’s capital planning including plans for a general obligation bond.

• Electrical substation additions, as the site is adjacent to an existing substation.

• San Francisco Municipal Railway turn-around proposed at 19th Street including signalization of Illinois Street. These costs are included in the San Francisco Municipal Transportation Agencies capital plans.

• The cost of the new Ferry Terminal shown in the Preferred Master Plan.



• Costs of upgrading facilities within the ship repair area with the exception of the rehabilitation of Building 111 and the construction of the new 19th Street access road.

• Costs of interim improvements for surface parking prior to construction of parking garages. Revenues from surface parking are also not included during this time period.

Table 15Adaptive Reuse Pro FormasPier 70 Financial Feasibility Analysis; EPS #17007

Item Per Sq. Ft. Total Per Sq. Ft. Total Per Sq. Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Office Office

Lease Up Year 1-18 1 5 Gross Building Area 721,569 square feet 721,569 56,268 square feet 56,268 37,641 square feet 37,641Efficiency Ratio 85% 85% 85%Net Building Area (Sq. Ft.) 613,334 47,828 31,995

REVENUE ASSUMPTIONSGross Revenue (NNN) $25.63 /sq. ft. $15,721,882 $36.00 /sq. ft. $1,721,801 $36.00 /sq. ft. $1,151,815(less) Operating Expenses [1] (1,641,321) ($172,180) ($115,181)(less) Leasing and Marketing 6% ($943,313) 6% ($103,308) 6% ($69,109)(less) Vacancy Rate 4% ($628,875) 4% ($68,872) 4% ($46,073)

Subtotal $17 $12,508,372 $24 $1,377,441 $24 $921,452

Building Value (capitalized at 7.5%) [2] 7.5% $231 $166,778,298 7.5% $326 $18,365,875 7.5% $326 $12,286,022

REHAB COSTSHard Costs 187,972,144 $14,560,000 $10,340,000HazMat Abatement, Soft Costs and Contingency [3] 75% $140,979,108 75% $10,920,000 75% $7,755,000

Total Costs [2] $456 $328,951,253 $453 $25,480,000 $481 $18,095,000

(less) Historic Tax Credit 20.0% of rehab cost ($65,790,251) 20.0% of rehab cost ($5,096,000) 20.0% of rehab cost ($3,619,000)

Net Value ($134) ($96,382,704) ($36) ($2,018,125) ($58) ($2,189,978)

Note: the cost estimates exclude the additional deterioration factor of 1% a year.

[1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.[2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates

building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.[3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems

Assumption Assumption

Building 101Bethlehem Steel Admin Building

Building 104 Office BuildingSummary - All Structures

Assumption


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DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Retail Industrial/ Office Industrial / Other

Lease Up Year 2 11 18 Gross Building Area 8,424 square feet 8,424 96,804 square feet 96,804 37,707 square feet 37,707Efficiency Ratio 85% 85% 85%Net Building Area (Sq. Ft.) 7,160 82,283 32,051

REVENUE ASSUMPTIONSGross Revenue (NNN) $18.00 /sq. ft. $128,887 $21.00 /sq. ft. $1,727,951 $15.00 /sq. ft. $480,764(less) Operating Expenses [1] ($14,321) ($172,795) ($64,102)(less) Leasing and Marketing 6% ($7,733) 6% ($103,677) 6% ($28,846)(less) Vacancy Rate 4% ($5,155) 4% ($69,118) 4% ($19,231)Subtotal $12 $101,678 $14 $1,382,361 $10 $368,586


REHAB COSTSHard Costs $2,580,000 $16,570,000 $11,630,000HazMat Abatement, Soft Costs and Contingency [3] 75% $1,935,000 75% $12,427,500 75% $8,722,500

Total Costs [2] $536 $4,515,000 $300 $28,997,500 $540 $20,352,500

(less) Historic Tax Credit 20.0% of rehab cost ($903,000) 20.0% of rehab cost ($5,799,500) 20.0% of rehab cost ($4,070,500)

Net Value ($268) ($2,256,298) ($49) ($4,766,518) ($301) ($11,367,521)





Assumption AssumptionAssumption

Building 102 Powerhouse #1

Building 2 Welding Shop

Building 6 Light Warehouse


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DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Retail / Other Office Industrial


REVENUE ASSUMPTIONSGross Revenue (NNN) $9.00 /sq. ft. $29,912 $20.25 /sq. ft. $796,457 $15.00 /sq. ft. $318,533(less) Operating Expenses [1] ($6,647) ($79,646) ($42,471)(less) Leasing and Marketing 6% ($1,795) 6% ($47,787) 6% ($19,112)(less) Vacancy Rate 4% ($1,196) 4% ($31,858) 4% ($12,741)Subtotal $5 $20,273 $14 $637,165 $10 $244,209

Building Value (capitalized at 7.5%) [2] 7.5% $69 $270,311 7.5% $184 $8,495,539 7.5% $130 $3,256,118

REHAB COSTSHard Costs $1,040,000 $12,280,000 $5,036,220HazMat Abatement, Soft Costs and Contingen 75% $780,000 75% $9,210,000 75% $3,777,165

Total Costs [2] $465 $1,820,000 $464 $21,490,000 $353 $8,813,386

(less) Historic Tax Credit 20.0% of rehab cost ($364,000) 20.0% of rehab cost ($4,298,000) 20.0% of rehab cost ($1,762,677)

Net Value ($303) ($1,185,689) ($188) ($8,696,461) ($152) ($3,794,591)






Building 52 Plate Shop

Building 111Warehouse #1

Building 110 Yard Washroom


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DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Institutional / Retail Retail / Parking Office


REVENUE ASSUMPTIONSGross Revenue (NNN) $20.00 /sq. ft. $1,701,887 $14.63 /sq. ft. $916,606 $36.00 /sq. ft. $4,967,451(less) Operating Expenses [1] ($170,189) ($125,348) ($496,745)(less) Leasing and Marketing 6% ($102,113) 6% ($54,996) 6% ($298,047)(less) Vacancy Rate 4% ($68,075) 4% ($36,664) 4% ($198,698)Subtotal $14 $1,361,510 $9 $699,597 $24 $3,973,961


REHAB COSTSHard Costs $28,630,000 $17,990,000 $48,250,000HazMat Abatement, Soft Costs and Conting 75% $21,472,500 75% $13,492,500 75% $36,187,500

Total Costs [2] $500 $50,102,500 $427 $31,482,500 $520 $84,437,500

(less) Historic Tax Credit 20.0% of rehab cost ($10,020,500) 20.0% of rehab cost ($6,296,500) 20.0% of rehab cost ($16,887,500)

Net Value ($219) ($21,928,539) ($215) ($15,858,035) ($90) ($14,563,856)





Assumption Assumption Assumption

Building 113 - 114UIW Machine Shop

Building 115-116 Brass Foundry

Building 12 Plate Shop #2


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DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Office Industrial / Retail Retail / Other

Lease Up Year 8 9 11 Gross Building Area 38,947 square feet 38,947 10,172 square feet 10,172 678 square feet 678Efficiency Ratio 85% 85% 85%Net Building Area (Sq. Ft.) 33,105 8,646 576

REVENUE ASSUMPTIONSGross Revenue (NNN) $36.00 /sq. ft. $1,191,778 $16.50 /sq. ft. $142,662 $9.00 /sq. ft. $5,187(less) Operating Expenses [1] ($119,178) ($17,292) ($1,153)(less) Leasing and Marketing 6% ($71,507) 6% ($8,560) 6% ($311)(less) Vacancy Rate 4% ($47,671) 4% ($5,706) 4% ($207)Subtotal $24 $953,423 $11 $111,104 $5 $3,515

Building Value (capitalized at 7.5%) [2] 7.5% $326 $12,712,301 7.5% $146 $1,481,382 7.5% $69 $46,872

REHAB COSTSHard Costs $12,300,000 $3,220,000 $320,000HazMat Abatement, Soft Costs and Contingency [3] 75% $9,225,000 75% $2,415,000 75% $240,000

Total Costs [2] $553 $21,525,000 $554 $5,635,000 $826 $560,000

(less) Historic Tax Credit 20.0% of rehab cost ($4,305,000) 20.0% of rehab cost ($1,127,000) 20.0% of rehab cost ($112,000)

Net Value ($116) ($4,507,699) ($298) ($3,026,618) ($592) ($401,128)






Building 21 Electric Shop/Substation #5

Building 50 Beth Street Substation

Building 14 Granny's Movers


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DEVELOPMENT PROGRAM ASSUMPTIONSIntended Use Industrial Retail Office / Parking


REVENUE ASSUMPTIONSGross Revenue (NNN) $15.00 /sq. ft. $127,500 $18 /sq. ft. $34,547 $28.13 /sq. ft. $270,738(less) Operating Expenses [1] ($17,000) ($3,839) ($27,074)(less) Leasing and Marketing 6% ($7,650) 6% ($2,073) 6% ($16,244)(less) Vacancy Rate 4% ($5,100) 4% ($1,382) 4% ($10,830)Subtotal $10 $97,750 $12 $27,254 $19 $216,591

Building Value (capitalized at 7.5%) [2] 7.5% $130 $1,303,333 7.5% $161 $363,387 7.5% $255 $2,887,875

REHAB COSTSHard Costs $1,131,624 $484,900 $1,609,400HazMat Abatement, Soft Costs and Contingency [3] 75% $848,718 75% $363,675 75% $1,207,050

Total Costs [2] $198 $1,980,342 $376 $848,575 $249 $2,816,450

(less) Historic Tax Credit 20.0% of rehab cost ($396,068) 20.0% of rehab cost ($169,715) 20.0% of rehab cost ($563,290)

Net Value ($28) ($280,940) ($140) ($315,473) $56 $634,715





Building 103Steam Powerhouse #2

Assumption AssumptionAssumptionBuilding Kneass

Building 19 Garage #1


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Table 16Rehabilitated Buildings Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Building Total 0 1 2 3 4 5 6 7

Building Lease Revenue Lease Revenue (constant $) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 Lease Revenue (nominal $) [1] $751,284,582 $0 $0 $1,461,327 $1,616,273 $1,664,761 $3,293,066 $4,492,120 $5,487,300

Rehab Costs (constant 2009$) [2]Building 101 ($25,480,000) $0 ($25,480,000) $0 $0 $0 $0 $0 $0Building 102 ($4,515,000) $0 $0 ($4,515,000) $0 $0 $0 $0 $0Building 2 ($28,997,500) $0 $0 $0 $0 $0 $0 $0 $0Building 104 ($18,095,000) $0 $0 $0 $0 $0 ($18,095,000) $0 $0Building 6 ($20,352,500) $0 $0 $0 $0 $0 $0 $0 $0Knease ($2,816,450) $0 $0 $0 $0 $0 $0 $0 ($2,816,450)Building 110 ($1,820,000) $0 $0 $0 $0 $0 $0 $0 $0Building 111 ($21,490,000) $0 $0 $0 $0 $0 $0 $0 $0Building 52 ($8,813,386) $0 $0 $0 $0 $0 $0 $0 $0Building 113-114 ($50,102,500) $0 $0 $0 $0 ($50,102,500) $0 $0 $0Building 115-116 ($31,482,500) $0 $0 $0 $0 $0 $0 ($31,482,500) $0Building 12 ($84,437,500) $0 $0 $0 $0 $0 $0 $0 $0Building 14 ($21,525,000) $0 $0 $0 $0 $0 $0 $0 $0Building 21 ($5,635,000) $0 $0 $0 $0 $0 $0 $0 $0Building 19 ($1,980,342) $0 $0 $0 $0 $0 $0 $0 $0Building 50 ($560,000) $0 $0 $0 $0 $0 $0 $0 $0Other Buildings (rehab) $0 $0 $0 $0 $0 $0 $0 $0 $0Total (constant $) ($328,102,678) $0 ($25,480,000) ($4,515,000) $0 ($50,102,500) ($18,095,000) ($31,482,500) ($2,816,450)

Total with 1% Deterioration (constant $) [3] ($355,060,817) $0 ($25,480,000) ($4,560,150) $0 ($51,620,656) ($18,829,730) ($33,088,424) ($2,989,718)Total with 1% Deterioration (nominal $) [3] ($468,115,064) $0 ($26,244,400) ($4,837,863) $0 ($58,099,503) ($21,828,817) ($39,509,309) ($3,676,977)

(Less) Historic Tax Credits (constant $) [4] $71,012,163 $0 $5,096,000 $912,030 $0 $10,324,131 $3,765,946 $6,617,685 $597,944(Less) Historic Tax Credits (nominal $) [4] $93,623,013 $0 $5,248,880 $967,573 $0 $11,619,901 $4,365,763 $7,901,862 $735,395

Rehab Net Impact (constant $) $92,223,585 $0 ($20,384,000) ($2,270,679) $1,479,118 ($39,817,406) ($12,223,156) ($22,708,660) $2,069,902Rehab Net Impact (nominal $) $376,792,530 $0 ($20,995,520) ($2,408,964) $1,616,273 ($44,814,842) ($14,169,988) ($27,115,327) $2,545,719NPV (at 15%) ($72,930,531)

[1] Annual lease revenues for the year are shown for years 0-29. In year 30, lease revenues are capitalized at 10%.[2] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs. [3] Reflects an escalation cost of 1 percent due to deterioration starting in year 2.[4] Assumed at 20% of rehab cost.

Source: Economic & Planning Systems

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Building Total

Building Lease Revenue Lease Revenue (constant $) [1] $376,272,239 Lease Revenue (nominal $) [1] $751,284,582

Rehab Costs (constant 2009$) [2]Building 101 ($25,480,000)Building 102 ($4,515,000)Building 2 ($28,997,500)Building 104 ($18,095,000)Building 6 ($20,352,500)Knease ($2,816,450)Building 110 ($1,820,000)Building 111 ($21,490,000)Building 52 ($8,813,386)Building 113-114 ($50,102,500)Building 115-116 ($31,482,500)Building 12 ($84,437,500)Building 14 ($21,525,000)Building 21 ($5,635,000)Building 19 ($1,980,342)Building 50 ($560,000)Other Buildings (rehab) $0Total (constant $) ($328,102,678)

Total with 1% Deterioration (constant $) [3] ($355,060,817)Total with 1% Deterioration (nominal $) [3] ($468,115,064)

(Less) Historic Tax Credits (constant $) [4] $71,012,163(Less) Historic Tax Credits (nominal $) [4] $93,623,013

Rehab Net Impact (constant $) $92,223,585Rehab Net Impact (nominal $) $376,792,530NPV (at 15%) ($72,930,531)

8 9 10 11 12 13 14 15

$4,599,633 $5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894$5,826,677 $7,245,478 $7,612,156 $9,060,549 $9,366,283 $15,483,167 $16,236,944 $18,877,726

$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 ($28,997,500) $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 ($1,820,000) $0 $0 $0 $0$0 $0 ($21,490,000) $0 $0 $0 $0 $0$0 $0 ($8,813,386) $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 ($84,437,500) $0 $0 $0

($21,525,000) $0 $0 $0 $0 $0 $0 $0$0 ($5,635,000) $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 ($1,980,342) $0 $0$0 $0 $0 ($560,000) $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0

($21,525,000) ($5,635,000) ($30,303,386) ($2,380,000) ($84,437,500) ($1,980,342) ($28,997,500) $0

($23,077,713) ($6,101,898) ($33,142,366) ($2,629,001) ($94,204,246) ($2,231,499) ($33,001,860) $0($29,234,157) ($7,961,592) ($44,540,569) ($3,639,152) ($134,312,729) ($3,277,032) ($49,918,274) $0

$4,615,543 $1,220,380 $6,628,473 $525,800 $18,840,849 $446,300 $6,600,372 $0$5,846,831 $1,592,318 $8,908,114 $727,830 $26,862,546 $655,406 $9,983,655 $0

($13,862,538) $671,537 ($20,849,734) $4,442,333 ($68,794,075) $8,758,084 ($15,666,955) $12,116,894($17,560,648) $876,204 ($28,020,299) $6,149,228 ($98,083,901) $12,861,541 ($23,697,675) $18,877,726



Year


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Building Total






16 17 18 19 20 21 22 23

$12,116,894 $12,116,894 $12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$19,444,058 $20,027,380 $20,628,201 $21,893,365 $22,550,166 $23,226,671 $23,923,471 $24,641,175

$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 ($20,352,500) $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $0 ($20,352,500) $0 $0 $0 $0 $0

$0 $0 ($24,103,556) $0 $0 $0 $0 $0$0 $0 ($41,034,691) $0 $0 $0 $0 $0$0 $0 $4,820,711 $0 $0 $0 $0 $0$0 $0 $8,206,938 $0 $0 $0 $0 $0

$12,116,894 $12,116,894 ($7,165,951) $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$19,444,058 $20,027,380 ($12,199,551) $21,893,365 $22,550,166 $23,226,671 $23,923,471 $24,641,175



Year


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Building Total






24 25 26 27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $124,854,801$25,380,410 $26,141,823 $26,926,077 $27,733,860 $28,565,875 $29,422,852 $303,055,372

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $124,854,801$25,380,410 $26,141,823 $26,926,077 $27,733,860 $28,565,875 $29,422,852 $303,055,372



Year


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6. FEASIBILITY RESULTS

F ina nc ia l Feas ib i l i t y Ana lys i s

This section presents an assessment of the financial feasibility of the Pier 70 development. It incorporates the best available data on infrastructure and historic rehabilitation costs, and development phasing, market absorption, and financial assumptions derived from market studies and relevant data sources. It also makes assumptions regarding the availability of public funding sources, some of which will require special legislation or amendments to City policies and statutes, as discussed above.

The cash flow model used for this analysis represents the financial performance of the project from a master developer’s perspective because private sector investment will be necessary to successfully complete the project. For Pier 70 to attract investment necessary for this project, there must be a return on that investment commensurate with the risks incurred by the developer.

Summa ry o f Inves tments and Re turns

The realization of the Pier 70 Master Plan will require a substantial outlay of capital. Including all costs and contingencies associated with preparing the land for new development, rehabilitating the existing buildings included in the land use program, and environmental monitoring and other ongoing costs, expenditures total $655 million, in constant, 2009 dollars. Including inflation in this estimate puts the total at $800 million. Without the infusion of public financing, the building revenues and ground lease revenues do not generate a return on the expenditure investment sufficient to attract private capital to this project. On a constant dollars basis, including public financing sources in the cashflow including IFD, CFD, payroll tax, and historic tax credits results in positive net revenues of $163 million. Including a discount rate to reflect the risk adjusted, time value of money however, results in a negative financial result, with the NPV of the project

totaling negative $47 million.6 This result indicates that a feasible project will require additional public or philanthropic funding or lower cost financing mechanisms.

Table 17 summarizes the results of this analysis. The table illustrates the various revenues, costs, and public financing mechanisms on a net present value (NPV) basis, in total nominal dollars over the 30-year period, and in constant 2009 dollars. As shown, the revenues over time compared with total costs return a project IRR of 10 percent and an NPV of negative $46.8 million (assuming a 15 percent discount rate, over a 30-year period). This IRR represents a “blended” return to debt and equity funding the project. It is likely that leveraged returns to equity differ from returns to debt; actual returns will depend on the specific mix, type of funding, and timing of borrowing. The resulting project IRR is below a typical range of “feasible” projects which range from 15 to 25 percent.

6 15 percent discount rate, over 30-years.



Table 18 provides detailed project revenues, expenditures, and outside funding and public financing arrayed over a 30-year period. In addition to the various totals shown in the cash flow, the final row which reports the cumulative cash flow is an important feature of the analysis. As shown, in year 12 the cumulative cash investment reaches $166 million before revenues begin to outpace costs. The magnitude of equity investments at any given point in time will also depend on the developers’ investment horizon, business model, and other factors. Many complex master development projects create structures to spread investment risk over many parties.

Table 17Sources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007

Item NPV (at 15%) $2009 Summary[1] [2]

REVENUESNew Construction Ground Lease Revenue $56,016,522 $308,372,523Interim Leasing Income $10,623,793 $15,950,000Proposition A Park Bond $10,000,000 $10,000,000Infrastructure Financing District Bond (65% of T.I.) $29,883,663 $95,708,617Infrastructure Financing Pay As You Go $4,014,704 $15,454,140

Total Revenues $110,538,682 $445,485,280

EXPENDITURESSitework CostsDemolition $3,114,795 $4,317,725Infrastructure $32,076,218 $46,000,000Structured Parking $4,876,368 $23,921,635

Subtotal $40,067,382 $74,239,360Waterfront ImprovementsRemediation $11,590,520 $15,000,000Park Space and Open Space $12,661,348 $22,874,663Piers/Wharfs $7,866,045 $45,000,000

Subtotal $32,117,914 $82,874,663

Soft CostsPlanning & Entitlement $5,609,265 $9,855,701Project Management $2,887,412 $6,284,561Contingency $14,437,059 $31,422,805

Subtotal $22,933,736 $47,563,067

Subtotal Sitework, Waterfront, and Soft Costs $95,119,031 $204,677,089Rehabilitated Building Feasibility GapRehabilitation $148,633,125 $355,060,817(Less) Historic Tax Credits ($29,726,625) ($71,012,163)(Less) Historic Building Lease Revenue ($45,975,969) ($263,902,918)

Subtotal $72,930,531 $20,145,735

Ongoing Remediation Monitoring $889,236 $4,600,000

Base Rent To The Port $24,935,963 $87,000,000

Total Expenditures $193,874,761 $316,422,824

NET REVENUE BEFORE PROP D (See Note) ($83,336,079) $129,062,456IRR 8.2%

PROP D Bond $24,201,791 $41,990,455

NET REVENUE AFTER PROP D ($59,134,287) $171,052,911IRR 9.5%

CFD Public FinancingMello-Roos CFD $25,960,603 $83,796,470(Less) CFD Value Reduction @ 75% ($13,065,329) ($88,300,898)

Value of CFD $12,895,274 ($4,504,429)

NET REVENUE AFTER CFD FINANCING ($46,239,013) $166,548,483IRR 10.2%

MAXIMUM CUMULATIVE NEGATIVEMillions, Nominal ($165)

Note: This table provides details supporting Table 3. Here, revenues and costs are arranged in a particular order to arrive at the 'New Revenue BeforeProp D' subtotal. [1] Net present value is based on the discounted project cash flow in nominal dollars.[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing

remediation monitoring and base rent to Port are excluded.Source: Economic & Planning Systems, Inc.

Economic & Planning Systems, Inc. 1/15/2010 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls

57

Table 18Development Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 $4,599,633New Construction Ground Lease plus reversion value (2009$) [2] $438,172,337 $0 $323,899 $1,458,058 $2,268,317 $3,078,576 $3,888,835 $4,699,094 $5,509,353 $6,319,612Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000 $870,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0 $0

Total Revenues (2009$) $840,394,576 $10,000,000 $3,223,899 $5,445,498 $6,067,435 $6,587,694 $8,469,463 $9,911,173 $11,131,030 $11,789,245Total Revenues (inflated) 3.0% /yr $1,650,111,713 $10,000,000 $3,320,616 $5,777,129 $6,630,050 $7,414,508 $9,818,428 $11,834,459 $13,689,763 $14,934,262

EXPENDITURESSitework Costs (2009$)Demolition $4,317,725 $0 $0 $1,439,242 $1,439,242 $1,439,242 $0 $0 $0 $0Infrastructure [4] $46,000,000 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $3,066,667 $3,066,667 $3,066,667 $3,066,667Structured Parking [5] 657 spaces $23,921,635 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $74,239,360 $6,133,333 $6,133,333 $7,572,575 $7,572,575 $7,572,575 $3,066,667 $3,066,667 $3,066,667 $3,066,667Waterfront Improvements (2009$)Remediation $15,000,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $0 $0 $0Park Space and Open Space $22,874,663 $7,751,940 $0 $0 $0 $0 $0 $0 $6,033,769 $0Piers/Wharfs $45,000,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $82,874,663 $10,251,940 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $0 $6,033,769 $0Total Development Cost (2009$) $157,114,023 $16,385,273 $8,633,333 $10,072,575 $10,072,575 $10,072,575 $5,566,667 $3,066,667 $9,100,435 $3,066,667Soft Costs (constant 2009$)Planning & Entitlement [6] 5% of development cost $9,855,701 $2,819,264 $431,667 $503,629 $503,629 $503,629 $278,333 $153,333 $455,022 $153,333Project Management 4% of development cost $6,284,561 $655,411 $345,333 $402,903 $402,903 $402,903 $222,667 $122,667 $364,017 $122,667Contingency 20% of development cost $31,422,805 $3,277,055 $1,726,667 $2,014,515 $2,014,515 $2,014,515 $1,113,333 $613,333 $1,820,087 $613,333

Subtotal $47,563,067 $6,751,729 $2,503,667 $2,921,047 $2,921,047 $2,921,047 $1,614,333 $889,333 $2,639,126 $889,333Rehabilitated Building Feasibility Gap Rehabilitation [7] $355,060,817 $0 $25,480,000 $4,560,150 $0 $51,620,656 $18,829,730 $33,088,424 $2,989,718 $23,077,713(Less) Historic Tax Credits 20% of rehab cost ($71,012,163) $0 ($5,096,000) ($912,030) $0 ($10,324,131) ($3,765,946) ($6,617,685) ($597,944) ($4,615,543)

Subtotal $284,048,654 $0 $20,384,000 $3,648,120 $0 $41,296,525 $15,063,784 $26,470,739 $2,391,775 $18,462,171Ongoing Remediation Monitoring (2009$) [1] $6,600,000 $0 $0 $0 $0 $0 $0 $0 $200,000 $200,000Base Rent To The Port (2009$) [1] $113,100,000 $0 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

Total Expenditures (2009$) $608,425,743 $23,137,002 $34,421,000 $19,541,742 $15,893,622 $57,190,146 $25,144,784 $33,326,739 $17,231,336 $25,518,171Total Expenditures (inflated) 3.0% /yr $867,085,313 $23,137,002 $35,453,630 $20,731,834 $17,367,390 $64,368,014 $29,149,696 $39,793,869 $21,192,370 $32,325,655

Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8] $137,760,908 $0 $0 $0 $3,014,828 $6,583,664 $4,947,411 $6,538,570 $6,403,289 $6,480,593IFD Pay As You Go (inflated) $23,096,190 $0 $0 $60,840 $193,700 $293,540 $425,490 $554,710 $685,490 $811,850

Total IFD Proceeds (inflated) $160,857,098 $0 $0 $60,840 $3,208,528 $6,877,204 $5,372,901 $7,093,280 $7,088,779 $7,292,443NET REVENUE BEFORE PROP D $943,883,498 ($13,137,002) ($32,133,014) ($14,893,865) ($7,528,811) ($50,076,302) ($13,958,367) ($20,866,130) ($413,828) ($10,098,950)CUMULATIVE ($13,137,002) ($45,270,016) ($60,163,880) ($67,692,691) ($117,768,994) ($131,727,360) ($152,593,490) ($153,007,319) ($163,106,269)

PROP DBond Proceeds (inflated) [9] $48,678,446 $0 $0 $0 $0 $0 $48,678,446 $0 $0 $0

Public Financing Available NowGrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Mello-Roos CFD (inflated) $120,938,294 $0 $0 $0 $1,755,093 $6,434,940 $4,893,655 $5,133,424 $5,382,245 $5,640,427(Less) CFD Value Reduction @ 75% [10] ($162,572,252) $0 $0 $0 ($121,264) ($565,869) ($903,984) ($1,258,665) ($1,630,537) ($2,020,248)

Total Public Financing (inflated) ($41,633,958) $0 $0 $0 $1,633,830 $5,869,071 $3,989,671 $3,874,759 $3,751,708 $3,620,179

NET REVENUE AFTER PROP D AND CFD [11] $950,927,987 ($13,137,002) ($32,133,014) ($14,893,865) ($5,894,981) ($44,207,232) $38,709,751 ($16,991,371) $3,337,880 ($6,478,771)CUMULATIVE ($13,137,002) ($45,270,016) ($60,163,880) ($66,058,862) ($110,266,094) ($71,556,342) ($88,547,713) ($85,209,834) ($91,688,605)

FactorYear


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Item

REVENUESRehabilitated Building Lease plus reversion value (2New Construction Ground Lease plus reversion valuInterim Leasing Income (2009$) [3]Proposition A Park Bond (2009$)

Total Revenues (2009$)Total Revenues (inflated) 3.0%

EXPENDITURESSitework Costs (2009$)DemolitionInfrastructure [4]Structured Parking [5] 657

SubtotalWaterfront Improvements (2009$)Remediation Park Space and Open SpacePiers/Wharfs

SubtotalTotal Development Cost (2009$)Soft Costs (constant 2009$)Planning & Entitlement [6] 5%Project Management 4%Contingency 20%

SubtotalRehabilitated Building Feasibility Gap Rehabilitation [7](Less) Historic Tax Credits 20%

SubtotalOngoing Remediation Monitoring (2009$) [1]Base Rent To The Port (2009$) [1]

Total Expenditures (2009$)Total Expenditures (inflated) 3.0%

Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8]IFD Pay As You Go (inflated)

Total IFD Proceeds (inflated)NET REVENUE BEFORE PROP DCUMULATIVE

PROP DBond Proceeds (inflated) [9]

Public Financing Available NowGrantsMello-Roos CFD (inflated)(Less) CFD Value Reduction @ 75% [10]

Total Public Financing (inflated)

NET REVENUE AFTER PROP D AND CFD [11]CUMULATIVE

9 10 11 12 13 14 15 16 17 18 19

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894 $12,116,894 $12,485,480$7,129,871 $7,940,130 $8,750,389 $9,560,648 $10,370,907 $11,181,166 $11,991,425 $12,801,684 $13,611,943 $14,422,202 $14,422,202

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$13,262,926 $13,894,289 $15,295,922 $16,129,970 $20,914,190 $21,915,699 $24,108,319 $24,918,578 $25,728,837 $26,539,096 $26,907,682$17,305,110 $18,672,762 $21,173,133 $22,997,480 $30,713,193 $33,149,461 $37,559,975 $39,987,002 $42,525,847 $45,181,034 $47,182,783

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,973,878 $0 $0 $7,973,878 $0 $7,973,878 $0 $0$3,066,667 $0 $0 $7,973,878 $0 $0 $7,973,878 $0 $7,973,878 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,973,878 $9,775,624 $4,500,000 $15,360,834 $4,500,000 $12,473,878 $4,500,000 $4,500,000

$153,333 $46,319 $225,000 $398,694 $488,781 $225,000 $768,042 $225,000 $623,694 $225,000 $225,000$122,667 $37,055 $180,000 $318,955 $391,025 $180,000 $614,433 $180,000 $498,955 $180,000 $180,000$613,333 $185,275 $900,000 $1,594,776 $1,955,125 $900,000 $3,072,167 $900,000 $2,494,776 $900,000 $900,000$889,333 $268,649 $1,305,000 $2,312,425 $2,834,931 $1,305,000 $4,454,642 $1,305,000 $3,617,425 $1,305,000 $1,305,000

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0 $24,103,556 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0 ($4,820,711) $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0 $19,282,845 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,749,700 $17,495,754 $35,306,488 $22,915,476 $8,905,000 $19,191,303 $28,187,845 $8,905,000$15,575,753 $41,404,607 $15,237,924 $126,535,851 $25,693,105 $53,404,231 $35,701,565 $14,289,911 $31,720,300 $47,987,919 $15,614,971

$6,261,567 $7,382,464 $6,751,154 $7,214,974 $7,279,393 $12,587,553 $8,142,613 $10,216,918 $8,767,482 $9,147,556 $9,540,515$960,830 $1,097,070 $1,242,670 $1,389,570 $1,643,590 $1,807,910 $2,014,090 $2,191,020 $2,375,620 $2,568,150 $2,780,050

$7,222,397 $8,479,534 $7,993,824 $8,604,544 $8,922,983 $14,395,463 $10,156,703 $12,407,938 $11,143,102 $11,715,706 $12,320,565$8,951,754 ($14,252,310) $13,929,034 ($94,933,827) $13,943,071 ($5,859,308) $12,015,113 $38,105,030 $21,948,649 $8,908,821 $43,888,376

($154,154,515) ($168,406,826) ($154,477,792) ($249,411,619) ($235,468,548) ($241,327,856) ($229,312,743) ($191,207,713) ($169,259,064) ($160,350,243) ($116,461,867)

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$5,908,289 $6,186,159 $6,474,378 $6,773,297 $7,083,276 $7,404,691 $7,737,926 $8,083,381 $8,441,465 $8,812,604 $9,197,234

($2,428,466) ($2,855,882) ($3,303,213) ($3,771,197) ($4,260,597) ($4,772,205) ($5,306,838) ($5,865,338) ($6,448,579) ($7,057,463) ($7,692,923)$3,479,823 $3,330,277 $3,171,165 $3,002,100 $2,822,679 $2,632,486 $2,431,089 $2,218,043 $1,992,886 $1,755,140 $1,504,312

$12,431,577 ($10,922,034) $17,100,199 ($91,931,726) $16,765,750 ($3,226,822) $14,446,202 $40,323,073 $23,941,535 $10,663,962 $45,392,688($79,257,028) ($90,179,062) ($73,078,863) ($165,010,589) ($148,244,840) ($151,471,662) ($137,025,459) ($96,702,387) ($72,760,852) ($62,096,890) ($16,704,203)

Year


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59


Item

REVENUESRehabilitated Building Lease plus reversion value (2New Construction Ground Lease plus reversion valuInterim Leasing Income (2009$) [3]Proposition A Park Bond (2009$)

Total Revenues (2009$)Total Revenues (inflated) 3.0%

EXPENDITURESSitework Costs (2009$)DemolitionInfrastructure [4]Structured Parking [5] 657

SubtotalWaterfront Improvements (2009$)Remediation Park Space and Open SpacePiers/Wharfs

SubtotalTotal Development Cost (2009$)Soft Costs (constant 2009$)Planning & Entitlement [6] 5%Project Management 4%Contingency 20%

SubtotalRehabilitated Building Feasibility Gap Rehabilitation [7](Less) Historic Tax Credits 20%

SubtotalOngoing Remediation Monitoring (2009$) [1]Base Rent To The Port (2009$) [1]

Total Expenditures (2009$)Total Expenditures (inflated) 3.0%

Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8]IFD Pay As You Go (inflated)

Total IFD Proceeds (inflated)NET REVENUE BEFORE PROP DCUMULATIVE

PROP DBond Proceeds (inflated) [9]

Public Financing Available NowGrantsMello-Roos CFD (inflated)(Less) CFD Value Reduction @ 75% [10]

Total Public Financing (inflated)

NET REVENUE AFTER PROP D AND CFD [11]CUMULATIVE

20 21 22 23 24 25 26 27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $124,854,801$14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $14,422,202 $144,222,016

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $26,907,682 $269,076,817$48,598,266 $50,056,214 $51,557,901 $53,104,638 $54,697,777 $56,338,710 $58,028,871 $59,769,737 $61,562,830 $63,409,714 $653,120,059

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$9,000,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$9,000,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$9,000,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$450,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$360,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,800,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$2,610,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $29,000,000

$14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $31,000,000$26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433 $6,885,996 $7,092,576 $7,305,353 $75,245,137

$10,500,364 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$10,500,364 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$32,530,734 $44,289,301 $45,617,980 $46,986,519 $48,396,115 $49,847,998 $51,343,438 $52,883,742 $54,470,254 $56,104,361 $577,874,922

($83,931,133) ($39,641,832) $5,976,148 $52,962,667 $101,358,782 $151,206,781 $202,550,219 $255,433,961 $309,904,214 $366,008,576 $943,883,498

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0$9,595,809 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,234,657) ($7,790,051) ($19,436,912)$1,239,888 ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,355,921) ($8,234,657) ($7,790,051) ($19,436,912)

$33,770,622 $35,933,380 $37,262,059 $38,630,599 $40,040,194 $41,492,078 $42,987,518 $44,527,821 $46,235,597 $48,314,310 $558,438,010$17,066,419 $52,999,800 $90,261,859 $128,892,458 $168,932,653 $210,424,731 $253,412,249 $297,940,070 $344,175,667 $392,489,977 $950,927,987

Year


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Table 18 Footnotes

[1] Capitalized at 10%.

[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per

1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project: [6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.[8] Infrastructure Financing District. [9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section

while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic feasibility gap while on this table they are split among the revenues and expenditures sections.

Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc

[2] Assumes 8.5% of residual land value; capitalized at 10%.


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7. SENSITIVITY TESTS

EPS conducted several sensitivity tests which evaluate the impact on the financial feasibility results of additional funding, financing, land uses, and timing investments. As discussed earlier, the base case project does not represent a feasible project (assuming a 15 percent blended rate of return). The Port is exploring a number of opportunities for securing additional funding. These sensitivities were designed to test how achieving a higher level of outside funding may impact feasibility. The sensitivities tested and the results of the evaluation are summarized below.

Sens i t i v i t i es Tes ted

Based on Port direction and discussion of potential alterations to the assumptions contained in the base case financial feasibility analysis, EPS tested how changes to the base case would impact the feasibility results. The sensitivities tested are described below in Table 19.

Table 19. Sensitivity Descriptions

Sensitivity Name Sensitivity Description

Sensitivity 1–State Share of IFD

Includes the State’s 25.3 percent share of the tax increment above the base case scenario assumption of 65 percent, to be available to the project.

Sensitivity 2–Grant Funds, No Repayment

Includes an additional public or philanthropic funds inflow to the project of $40 million split between years 1 and 2.

Sensitivity 3–Additional Public Debt with Repayment

Includes an additional loan to the project at public sector debt rates of $40 million split between years 1 and 2 repaid, amortized over 30 years with a 6 percent interest rate.

Sensitivity 4–Ground Lease Site: Rental Residential

Assumes that ground lease proceeds for 205,000 square feet of new commercial uses in year 2 will be replaced by the same square

footage of rental residential subject to a long-term ground lease.7

Sensitivity 5–Sell Site: For-Sale Residential

Assumes that ground lease proceeds for 205,000 square feet of new commercial uses in year 2 will be replaced by revenue from the sale of land for an equivalently sized condominium development.

7 In order to maintain all of the other elements of the financial scenario while altering just the development use—changing commercial square footage to residential square footage—the sensitivity alters the use of the year 2 commercial development which totaled roughly 205,000 square feet in the base case financial model.



Table 19. Sensitivity Descriptions (continued)

Sensitivity Name Sensitivity Description

Sensitivity 6–Sell Site: Commercial

Assumes that ground lease proceeds for 205,000 square feet of new commercial uses in year 2 will be replaced by revenue from the sale of land for commercial uses, including biotech, medical office, and general office.

Sensitivity 7–Spread Costs

Assumes that infrastructure, environmental remediation, and demolition costs (costs plus all soft costs) will be incurred a year before new development, in proportion to the absorption of new development square footage during the initial 15 years of the project.

Resu l t s o f Tes ts

Testing the seven sensitivities reveals potential options for improving the project’s NPV above the 15 percent feasibility threshold. Table 20 illustrates the results of the tests.

Additional Funding Sensitivities. Sensitivities 1 (State Share of IFD), 2 (Additional Funds, No Repayment, and 3 (Public Loan with Repayment) all improve the project NPV significantly. Sensitivity2 which includes $40 million funding from sources outside of development at Pier 70, generates the highest positive impact on the financial feasibility of the project, improving the project NPV by $34 million. Including Sensitivities 1 and 3 in the cash flow also result in significant improvements, adding $13 million and $18 million, respectively, to the Project’s NPV.

Cost Management. Sensitivity 7 (Spread Costs) also had a considerable impact on the Project’s financials, improving the cashflow by more than $20 million by spreading infrastructure and environmental remediation costs over a 15-year period. This shows that a more refined look at the timing of costs could benefit the project pro forma. Similar gains to the project feasibility may be possible by spending funds to stabilize historic buildings and then rehabbing them later than the schedule included in this analysis. In particular, this could avoid the extraordinary cost inflation included due to projected deterioration.

Land Use Change. One sensitivities tests land use changes. Sensitivity 4 (Ground Lease Site 1: Rental Residential) tests a residential use on leased land. This alternative decreases the project NPV due to the estimated lower value of residential uses at the site compared with commercial uses. This affects the lease revenues and the projected assessed value and associated property taxes.

Sale versus Lease. Two sensitivities, Sensitivities 5 (Sell Site 1: For-Sale Residential) and 6 (Sell Site 1: Commercial) test the sale of land for development. The parcel tested as a saleable location is roughly equivalent to Site 1 in the site plan, the most northern parcel which is located adjacent to Crane Cove Park’s northeast edge. The sale of the land for residential use compared with leasing it for commercial uses results in an NPV decrease (Sensitivity 5)—due to the estimated lower land value. The sale of land for commercial uses results in a modest



improvement in the project’s NPV of almost $2 million (Sensitivity 6). With commercial land values estimated to be slightly higher than residential, the sale of land for residential uses also negatively affects the CFD and IFD values, further decreasing the project NPV.

Table 20Sensitivity Test ResultsPier 70 Financial Feasibility Analysis; EPS #17007

Change in NPVScenario Variation from Base Case IRR NPV from Base Case

($millions) ($millions)

Base Case -- 10.2% ($46.2) $0.0

1 State Share of IFD (both in the bond and in the pay as you go revenues)

11.4% ($33.6) $12.6

2 Public Loan ($20M in Year 1 $20 million in 2)

13.0% ($12.9) $33.4

3 Additional Public Debt with Repayment ($20M in Year 1 and $20 in Year 2 with repayment over 30 years)

11.0% ($28.6) $17.6

4 Ground Lease Site: Rental Residential (equal to Base Case Year 2 new building square feet)

8.9% ($63.7) ($17.4)

5 Sell Site: For-Sale Residential (equal to Base Case Year 2 new building square feet)

8.9% ($60.8) ($14.5)

6 Sell Site: Commercial (equal to Base Case Year 2 new building square feet) [1]

10.1% ($43.8) $2.5

7 Spread Costs (over 16-year period)

11.5% ($25.0) $21.3

[1] Note that in this case, the NPV is improved by the sensitivity while the IRR is not. This is because the discount rate being applied to calculate the NPV (15%) is higher than the IRR of the cashflow. Selling a site for commercial use does not provide an appreciable improvement for the Project cashflow.

Source: Port of San Francisco, Economic & Planning Systems

Economic & Planning Systems 1/15/2010 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls

66

APPENDICES:

Appendix A: Additional Support Tables

Appendix B: Sensitivity Results

Table A1Biotech Pro FormaPier 70 Financial Feasibility Analysis; EPS #17007

Item Per Bldg. Sq. Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSGross Building Area [1] 1,268,295 square feet 1,268,295Parking Ratio (Spaces per 1,000; Sq.Ft.) 0.50 Spaces per 1,000 GSF 177,289Parking Spaces 325 square feet 546 Building Floor Area (Sq. Ft.) (excludes parking sq. ft.) 1,091,007Net Floor Area with Efficiency Ratio 100% 1,091,007

REVENUE ASSUMPTIONSGross Building Revenue (NNN) $50.00 /sq. ft. $54,550,339(less) Operating Expenses 10% ($5,455,034)(less) Leasing and Marketing 5% ($2,727,517)(less) Vacancy Rate 4% ($2,182,014)

Building Revenue Subtotal $44,185,774Gross Parking Revenue-Reserved [2], [3] $225.00 /space/month $1,104,644Gross Parking Revenue-Daily [2], [3] $12.00 /space/day $409,128

Total Gross Revenue $1,513,772(less) Operating Expenses 30% ($454,132)(less) Vacancy Rate 2% ($30,275)

Parking Revenue Subtotal $1,029,365Net Revenue $45,215,139

Revenue Total (capitalized at 7.0%) 7.0% $509 $645,930,563

COST ASSUMPTIONSDirect CostsBuilding Construction Cost $280 /sq. ft. $305,481,898Site Improvement Cost [4] $15 /land sq.ft. $2,624,677Parking Cost $25,000 /space $13,637,585

Total Direct Costs $321,744,159

Indirect CostsSoft Costs [5] 15% $48,261,624Impact Fees $32 /sq. ft. $34,803,116Tenant Improvements $50 /sq. ft. $54,550,339

Total Indirect Costs $137,615,079

Contingency (% of total costs) 10% $45,935,924

Profit (% of total costs) 10% of total costs $45,935,924

Total Costs [6] $435 $551,231,086

Total Residual Land Value $75 $94,699,476Residual Land Lease 8.5% $6.35 $8,049,455

[1] Including parking.

in San Francisco. 75% of spaces are assumed to be occupied by monthly parkers.Daily rate is estimated based on Mission Bay parking lot rates. 25% of spaces assumed to be daily parking.

[3] Parking tax, calculated as 25% of parking revenue shown here, generated on an annual basis total $378,000.[4] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall space.[5] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.[6] Total costs are comparable to reported costs of the Gladstone building at the Mission Bay campus ($370 in 2004

per building square foot excluding parking) and the Alexandria Technology Center in South San Francisco that is estimated to cost $350 per building square foot (2009). The $280 per square foot direct costs is based on an articlerelated to reported costs for biotech construction of $250 to $300 per building square foot (September 2007).


Assumption

[2] Monthly rate is based on Colliers International Parking Survey, 2006; reflects "low" monthly, unreserved parking rate


Table A2Medical Office Pro FormaPier 70 Financial Feasibility Analysis; EPS #17007


DEVELOPMENT PROGRAM ASSUMPTIONSGross Building Area [1] 126,830 square feet 126,830Parking Ratio/ Parking Sq. Ft. [2] 1.19 Spaces per 1,000 GSF 35,458

Parking Spaces 325 square feet 109 Net Building Area (Sq. Ft.) 91,372Net Floor Area with Efficiency Ratio 100% 91,372

REVENUE ASSUMPTIONSGross Revenue (NNN) $46.00 /sq. ft. $4,203,104(less) Operating Expenses 10% ($420,310)(less) Leasing and Marketing 5% ($210,155)(less) Vacancy Rate 4% ($168,124)

Building Revenue Subtotal $3,404,514Gross Parking Revenue-Reserved [3], [4] $225.00 /space/month $220,929Gross Parking Revenue-Daily [3], [4] $12.00 /space/day $81,826

Total Gross Revenue $302,754(less) Operating Expenses 30% ($90,826)(less) Vacancy Rate 2% ($6,055)

Parking Revenue Subtotal $205,873Net Revenue $3,610,387

Revenue Total (capitalized at 7.%) 7.0% $407 $51,576,956

COST ASSUMPTIONSDirect CostsBuilding Construction Cost $250 /sq. ft. $22,842,954Site Improvement Cost [5] $15 /land sq.ft. $262,468Parking Cost $25,000 /space $2,727,517






Total Costs $348 $44,081,247

Total Residual Land Value $59 $7,495,709Residual Land Lease 8.5% $5.02 $637,135

[1] Including parking; based on the EPS Market Study finding related to the likely demand for medical office space as a result of the development of a new UCSF hospital on the south end of Mission Bay.[2] Medical office use is assumed to require a parking ratio above the standard 1.0 spaces per 1,000 sq.ft. development. Here,

a 1.2 spaces per 1,000 is included in the building pro formas. Combined with the 0.5 ratio included in the parking structure, the total for medical office is 1.7 spaces per 1,000 building square feet.

[3] Parking tax generated on an annual basis from spaces included in this proforma total $76,000.[4] Monthly space rate based on broker reports and daily rates based on Mission Bay structure rates. Daily parking assumed for 250

days each year. [5] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall building space.[6] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.


Assumption


Table A3Office Pro FormaPier 70 Financial Feasibility Analysis; EPS #17007


DEVELOPMENT PROGRAM ASSUMPTIONSGross Building Area [1] 1,141,466 square feet 1,141,466Spaces per 1,000 Sq.Ft. 0.50 Spaces per 1,000 GSF 159,560Parking Spaces 325 square feet 491 Net Building Area (Sq. Ft.) 981,906

REVENUE ASSUMPTIONSGross Revenue NNN $40.00 /sq. ft. $39,276,244(less) Operating Expenses 10% ($3,927,624)(less) Leasing and Marketing 5% ($1,963,812)(less) Vacancy Rate 4% ($1,571,050)

Building Revenue Subtotal $31,813,758Gross Parking Revenue-Reserved [2], [3] $225.00 /space/month $994,180Gross Parking Revenue-Daily [2], [3] $12.00 /space/day $368,215

Total Gross Revenue $1,362,395(less) Operating Expenses 30% ($408,718)(less) Vacancy Rate 2% ($27,248)

Parking Revenue Subtotal $926,428Net Revenue $32,740,186

Revenue Total (capitalized at 7.0%) 7.0% $410 $467,716,943.

COST ASSUMPTIONSDirect CostsBuilding Construction Cost [4] $230 /sq. ft. $225,838,403Site Improvement Cost [5] $15 /land sq.ft. $2,362,209Parking Cost $25,000 /space $12,273,826






Total Costs $352 $401,937,548

Total Residual Land Value $58 $65,779,396Residual Land Lease 8.5% $4.90 $5,591,249

[1] Including parking.[2] Monthly space rate based on broker reports and daily rates based on Mission Bay structure rates. Daily parking assumed for 250

days each year. Rates are shown prior to the 25% San Francisco parking tax. Monthly and daily rates total $300 and $15, respectively with the tax.

[3] Parking taxes, which are 25% of parking revenues, are calculated on an annual basis and total $341,000.[4] Based on and EPS survey of office developers (2007, inflated for 2009) in the San Francisco Bay Area.[5] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall space.[6] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.Source: Economic & Planning Systems, Inc.

Assumption


Table A4Structured ParkingPier 70 Financial Feasibility Analysis; EPS #17007

ItemPer Bldg Sq. Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSNew Development (sq. ft.) 3,097,080Amt. needed due to rehabbed bldg demand (sq.ft.) 205,589Residual new development (sq.ft.) 2,891,491Amt. devoted to parking (sq.ft.) 354,617Total structure size 560,205Total Parking Required (Spaces) 325 square feet per stall 1,724

(less) Assumed On-Street Parking 0.0 per 100 LF of roadway 0Required Parking 1,724

REVENUE ASSUMPTIONSGross Revenue-Reserved [3], [5] $225.00 /space/month $3,490,511Gross Revenue-Daily [4], [5] $12.00 /space/day $1,613,392Total Gross Revenue $5,103,903(less) Operating Expenses 30% ($1,531,171)(less) Vacancy Rate 2% ($102,078)

Subtotal $3,470,654

Revenue Total $69 $38,562,820

COST ASSUMPTIONSDirect Costs

Construction Cost [6] $25,000 per space $43,092,727

Indirect CostsSoft Costs [7] 25% $10,773,182


Profit (% of total costs) 10% $4,309,273

Total Costs $112 $62,484,454

Total Residual Land Value ($43) ($23,921,635)

[1] Excludes parking.[2] Excludes 47,000 square feet of parking provided in the rehabbed space.

[4] Estimated based on Mission Bay parking lot rates. 25% of spaces assumed to be daily parking.Daily parking revenue is based on 312-use days (6 days per week). Rate shown is before parking tax applied.

[5] Parking taxes, calculated as 25% of parking revenue included in this proforma, generated on an annual basis total $1,276,000.[6] Based on EPS experience with nearby projects.[7] Soft costs include architecture and engineering, permits and fees, legal, project management, and finance costs.


Assumption

[3] Monthly rate is based on Colliers International Parking Survey, 2006; reflects "low" monthly, unreserved parking rate in San Francisco. 75% of spaces are assumed to be occupied by monthly parkers. Rate shown is before parking tax is applied.

at cap. rate 9%

Economic & Planning Systems, Inc. 1/15/2010 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls

Table A5 Pro forma is not in use.Hotel Pro FormaPier 70 Financial Feasibility Analysis; EPS #17007

Item Assumption Per Room Per Sq.Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSSite 1a and 1b Building Pads (acres) 0.33Gross Development Square Footage (6-story building) 643 86,700Number of Rooms [1] 117 117Hotel Sq. Ft. 500 gross sq.ft per room 58,286Parking Ratio 0.75 spaces per hotel room 87Parking Square Footage 325 28,414

REVENUE ASSUMPTIONSGross Rental Revenue $150 $6,382,286Other Operating Revenue 25% $1,595,571

Subtotal $7,977,857Occupancy 70%

Total Revenue $5,584,500

(less) Operating Expenses 50% % of Total Rev $2,792,250(less) Capital Reserves 5% % of Total Rev $279,225Annual Net Operating Income $2,513,025

Total Value Capped at 8% $269,473 $362 $31,412,813

COST ASSUMPTIONSBuilding Construction Costs per Gross Sq. Ft. $150 /sq. ft. $13,005,000Parking Construction Costs $25,000 / space $2,185,714Direct Site Improvement Costs/Footprint Sq. Ft. $25 /sq. ft. $361,250

Soft Costs as % of Direct Costs [2] 20% of direct costs $3,110,393Impact Fees $0.00 /sq. ft. $0

Subtotal Construction & Soft Costs $18,662,357

FF&E/GLA Sq. Ft. $60 building sq.ft. $3,497,143

Contingency 10% $1,866,236

Profit (% of total costs) 10% $1,866,236

Total Costs $222,113 $299 $25,891,971

Residual Land Value (RLV) $47,360 $64 $5,520,841Residual Land Lease 8.5% $4,026 $5.41 $469,271

[1] Assumes a mid-rise density building, based on the building envelopes estimated by ROMA for the Pier 70 Preferred Master Plan.[2] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.

Source: PKF Consulting; Marshall & Swift; Economic & Planning Systems, Inc.


Table A6 Pro forma is not in use.Residential (Condo)Pier 70 Financial Feasibility Analysis; EPS #17007

Item Assumptions Per Unit Per Sq.Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSLand Area (acres, Sites 3a and 3b) 2.07Total Units (4-5 floor buildings) [1] 268 268Average Net Unit SF 830Living Square Footage % of Total 83%Gross Square Footage 1,000 268,051Parking Ratio [2] 0.80 214Parking Square Footage 325 69,693

REVENUE ASSUMPTIONSBase Sale Revenue [3] $510,000 per unit $136,705,905(less) Closing Costs 1.00% ($5,100) ($1,367,059)(less) Cost of Sales 3.00% ($15,300) ($4,101,177)

Revenue Total $489,600 $490 $131,237,669

COST ASSUMPTIONSDirect CostsBuilding Construction Cost $270 per gross sq.ft. $72,373,714Parking Construction Costs [4] $25,000 /space $5,361,016

Total Direct Costs $290,000 $290 $77,734,730

Indirect CostsSoft Costs [5] 30% $87,000 $87.0 $23,320,419

Contingency (% of direct + indirect costs) 10% $37,700 $37.7 $10,105,515Profit (% of direct + indirect costs) 10% $37,700 $37.7 $10,105,515

Total Costs $452,400 $452.4 $121,266,179

Total Residual Land Value $37,200 $37 $9,971,490

[1] The number is units is calculated based on the total building envelope modeled for Site 3 in the Preferred Master Plan illustrative site plan.[2] Many residential zoning districts in San Francisco do not require parking and are zoned for 0.75 spaces per 1 bedroom unit and 1.00 spaces per 2-bedroom uni

Here, with a mix of studio, 1-bedroom and 2-bedrooms units likely for this type of development, an assumption of 0.80 spaces per unit is assumed.[3] Weighted average of prices, based on sale price of $660 per square foot of living space for market rate units based on DQNews sales

average for the Pier 70 zip code in 2006 and $330 per square foot for BMR units; BMR units are assumed to make up 15% of the overall mix.[4] Parking costs estimated at $25,000 in direct costs per space.[5] Soft costs include architecture and engineering, permits and fees, legal, project management, and finance costs.



Table A7 Pro forma is not in use.Residential (Rental)Pier 70 Financial Feasibility Analysis; EPS #17007

Item Assumptions Per Unit Per Sq.Ft. Total

DEVELOPMENT PROGRAM ASSUMPTIONSLand Area (acres, Sites 3a and 3b) 2.07Total Units (4-5 floor buildings) [1] 324 324Average Net Unit SF 830Living Square Footage % of Total 83%Gross Square Footage 800 258,870Parking Ratio [2] 0.75 243Parking Square Footage 325 78,874

REVENUE ASSUMPTIONSBase Rental Revenue [3] $2.96 NLA sq.ft./month $9,539,864(less) Operating Expenses 20.0% of gross income ($1,907,973)(less) Vacancy 3.0% of gross income ($286,196)Gross Parking Revenue $225.00 /space/month $655,264

Net Operating Income $7,345,696

Total Value Capped at 6.5% $338,766 $423 $109,620,381

COST ASSUMPTIONSDirect CostsBuilding Construction Cost $230 per gross sq.ft. $59,410,585Parking Construction Costs [4] $25,000 /space $6,067,257

Total Direct Costs $202,350 $253 $65,477,843

Indirect CostsSoft Costs [5] 30% $60,705 $75.9 $19,643,353

Contingency (% of total costs) 10% $26,306 $32.9 $8,512,120Profit (% of total costs) 10% $26,306 $32.9 $8,512,120

Total Costs $315,666 $394.6 $102,145,435

Total Residual Land Value $23,100 $29 $7,474,946Residual Land Lease 8.5% $1,964 $2.45 $635,370

[1] The number is units is calculated based on the total building envelope modeled for Site 3 in the Preferred Master Plan illustrative site plan.[2] Many residential zoning districts in San Francisco do not require parking and are zoned for 0.75 spaces per 1 bedroom unit and 1.00 spaces

2-bedroom unit. Here, a rental development with a mix of studio, 1-bedroom and 2-bedrooms units is assumed to have 0.80 spaces per unit is assume[3] Weighted average of lease rates with $3.20 per square foot per month of living space for market rate units and $1.60 per square

foot for BMR units; BMR units are assumed to make up 15% of the overall mix.[4] The cost of sale of 3% is assumed.[5] Parking costs estimated at $25,000 in direct costs per space.[6] Soft costs include architecture and engineering, permits and fees, legal, project management, and finance costs.



Table A8Fiscal Benefits SummaryPier 70 Financial Feasibility Analysis; EPS #17007

Item Fee Total [1]

New Development Sq. Ft. [2] 2,536,591

City Impact FeesHousing ($/sq.ft.) [3] $19.96Child Care ($/sq.ft.) [4] $1.00Transit Fee ($/sq.ft.) [4] $10.94

Subtotal ($/sq.ft.) $31.90Total Impact Fees [5] $80,920,000

Annual Parking TaxEstimate at Buildout [6] $2,078,900

School District Impact Fees$/Sq. Ft. [7] $0.27Total School Impact Fees $685,000

[4] Based on interview with City staff.

Source: City of San Francisco, Economic & Planning Systems, Inc.

[7] Dollars per square foot for 2009 based on interview with San Francisco Unified School District staff.

[1] New development is assumed to pay City impact fees imposed on "office" uses. Given the density of development envisioned for Pier 70, the office use - which requires the highest fee level - appears to be the most applicable use. The use clearly includes office and medical uses. A portion of biotech or R&D development may be categorized under R&D or Production, Distribution, and Repair. If biotech/R&D uses were not categorized under office, the Housing fee would be reduced by about $6.00 per square foot.

[6] Parking tax estimate, which is based on San Francisco's parking tax rate of 25% of parking revenue, is shown on each vertical pro forma table.

[2] Assumes that roughly 500,000 square feet in parking structure development will not provide impact fee payments. [3] Fee amount based on July 15, 2008 Mayor's Office of Housing notice of fees.

[5] Fees are shown applied only to new development. Rehabilitation building square footage is excluded.


APPENDIX B:

Sensitivity Results

Tables B-1 and B-2 Sensitivity 1—State Share of IFD

Tables B-3 and B-4 Sensitivity 2—Public Loan

Tables B-5 and B-6 Sensitivity 3—Additional Public Debt with Repayment

Tables B-7 and B-8 Sensitivity 4—Ground Lease Site: Rental Residential

Tables B-9 and B-10 Sensitivity 5—Sell Site: For-Sale Residential

Tables B-11 and B-12 Sensitivity 6—Sell Site: Commercial

Tables B-13 and B-14 Sensitivity 7—Spread Costs

SENSITIVITY 1 STATE SHARE OF IFD

Table B1 - Sensitivity 1 Sensitivity 1: State Share of IFDSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007


REVENUESNew Construction Ground Lease Revenue $55,437,142 $305,250,276Interim Leasing Income $10,623,793 $15,950,000Proposition A Park Bond $10,000,000 $10,000,000Infrastructure Financing District Bond (90.3% of T.I.) $41,510,556 $132,948,454Infrastructure Financing Pay As You Go $5,576,675 $21,467,025

Total Revenues $123,148,165 $485,615,755



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735




NET REVENUE BEFORE PROP D ($70,729,770) $169,177,360IRR 9.0%

PROP D Bond $24,199,503 $41,986,485



Value of CFD $12,893,832 ($4,503,925)


MAXIMUM CUMULATIVE NEGATIVEMillions, Nominal ($138.9)

[1] Net present value is based on the discounted project cash flow in nominal dollars.[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation

monitoring and base rent to Port are excluded.Sources: Economic & Planning Systems, Inc.

Economic & Planning Systems, Inc. 1/11/2010 P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls

Table B2 - Sensitivity 1 Sensitivity 1: State Share of IFDDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8



EXPENDITURESSitework Costs (2009$)Demolition $4,317,725 $0 $0 $1,439,242 $1,439,242 $1,439,242 $0 $0 $0 $0Infrastructure [4] $46,000,000 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $3,066,667 $3,066,667 $3,066,667 $3,066,667Structured Parking [5] 1,733 spaces $23,933,705 $0 $0 $0 $0 $0 $0 $0 $0 $0






Required Public Financing (inflated)IFD Bond (90.3% of T.I.) (inflated) [8] $191,363,793 $0 $0 $0 $4,188,292 $9,146,228 $6,864,146 $9,083,583 $8,904,596 $8,994,089IFD Pay As You Go (inflated) $32,082,506 $0 $0 $84,521 $269,094 $407,614 $590,923 $770,620 $952,123 $1,127,666

Total IFD Proceeds (inflated) $223,446,300 $0 $0 $84,521 $4,457,386 $9,553,842 $7,455,069 $9,854,203 $9,856,719 $10,121,756NET REVENUE BEFORE PROP D $997,688,344 ($13,137,002) ($32,138,505) ($14,889,840) ($6,308,793) ($47,438,221) ($11,925,029) ($18,164,894) $2,282,962 ($7,352,884)CUMULATIVE ($13,137,002) ($45,275,507) ($60,165,348) ($66,474,141) ($113,912,362) ($125,837,391) ($144,002,285) ($141,719,323) ($149,072,207)




NET REVENUE AFTER PROP D AND CFD [11] $1,004,732,888 ($13,137,002) ($32,138,505) ($14,889,840) ($4,675,146) ($41,569,807) $40,738,040 ($14,290,568) $6,034,250 ($3,733,110)CUMULATIVE ($13,137,002) ($45,275,507) ($60,165,348) ($64,840,494) ($106,410,301) ($65,672,261) ($79,962,829) ($73,928,579) ($77,661,689)

FactorYear

Economic & Planning Systems, Inc. 1/11/2010P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls

Page 1 of 5

Table B2 - Sensitivity 1Development Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007


REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239New Construction Ground Lease plus reversion value (2009$) [2] $433,750,830Interim Leasing Income (2009$) [3] $15,950,000Proposition A Park Bond (2009$) $10,000,000

Total Revenues (2009$) $835,973,069Total Revenues (inflated) 3.0% /yr $1,641,351,422

EXPENDITURESSitework Costs (2009$)Demolition $4,317,725Infrastructure [4] $46,000,000Structured Parking [5] 1,733 spaces $23,933,705

Subtotal $74,251,430Waterfront Improvements (2009$)Remediation $15,000,000Park Space and Open Space $22,874,663Piers/Wharfs $45,000,000

Subtotal $82,874,663Total Development Cost (2009$) $157,126,093Soft Costs (constant 2009$)Planning & Entitlement [6] 5% of development cost $9,856,305Project Management 4% of development cost $6,285,044Contingency 20% of development cost $31,425,219

Subtotal $47,566,567Rehabilitated Building Feasibility Gap Rehabilitation [7] $355,060,817(Less) Historic Tax Credits 20% of rehab cost ($71,012,163)

Subtotal $284,048,654Ongoing Remediation Monitoring (2009$) [1] $6,600,000Base Rent To The Port (2009$) [1] $113,100,000

Total Expenditures (2009$) $608,441,313Total Expenditures (inflated) 3.0% /yr $867,109,378

Required Public Financing (inflated)IFD Bond (90.3% of T.I.) (inflated) [8] $191,363,793IFD Pay As You Go (inflated) $32,082,506

Total IFD Proceeds (inflated) $223,446,300NET REVENUE BEFORE PROP D $997,688,344CUMULATIVE

PROP DBond Proceeds (inflated) [9] $48,673,844

Public Financing Available NowGrants $0Mello-Roos CFD (inflated) $120,924,765(Less) CFD Value Reduction @ 75% [10] ($162,554,065)

Total Public Financing (inflated) ($41,629,300)

NET REVENUE AFTER PROP D AND CFD [11] $1,004,732,888CUMULATIVE

Factor

Sensitivity 1: State Share of IFD

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$7,056,290 $7,858,684 $8,661,079 $9,463,473 $10,265,868 $11,068,262 $11,870,656 $12,673,051 $13,475,445

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$13,189,346 $13,812,844 $15,206,612 $16,032,795 $20,809,151 $21,802,795 $23,987,550 $24,789,945 $25,592,339$17,209,104 $18,563,307 $21,049,508 $22,858,933 $30,558,939 $32,978,684 $37,371,822 $39,780,584 $42,300,237

$0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858 $4,500,000 $12,477,902

$153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243 $225,000 $623,895$122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594 $180,000 $499,116$613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972 $900,000 $2,495,580$889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666 $8,905,000 $19,196,493$15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651 $14,289,911 $31,728,878

$8,698,761 $10,255,947 $9,378,911 $10,032,213 $10,103,808 $17,487,015 $11,311,969 $14,184,708 $12,180,055$1,334,634 $1,523,903 $1,726,355 $1,930,253 $2,283,145 $2,511,424 $2,797,675 $3,043,471 $3,299,923

$10,033,395 $11,779,849 $11,105,266 $11,962,466 $12,386,953 $19,998,439 $14,109,644 $17,228,179 $15,479,979$11,666,746 ($11,061,451) $16,916,850 ($91,721,852) $17,252,787 ($427,108) $15,771,814 $42,718,852 $26,051,337

($137,405,461) ($148,466,912) ($131,550,062) ($223,271,914) ($206,019,127) ($206,446,236) ($190,674,421) ($147,955,569) ($121,904,232)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,907,628 $6,185,467 $6,473,654 $6,772,539 $7,082,484 $7,403,863 $7,737,061 $8,082,477 $8,440,521

($2,428,194) ($2,855,563) ($3,302,843) ($3,770,775) ($4,260,121) ($4,771,672) ($5,306,244) ($5,864,682) ($6,447,858)$3,479,434 $3,329,904 $3,170,811 $3,001,764 $2,822,363 $2,632,191 $2,430,817 $2,217,795 $1,992,663

$15,146,180 ($7,731,547) $20,087,661 ($88,720,088) $20,075,150 $2,205,083 $18,202,631 $44,936,647 $28,044,000($62,515,509) ($70,247,056) ($50,159,395) ($138,879,483) ($118,804,333) ($116,599,250) ($98,396,619) ($53,459,972) ($25,415,971)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$26,394,733 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319$44,935,267 $46,929,643 $48,337,532 $49,787,658 $51,281,288 $52,819,726 $54,404,318 $56,036,447 $57,717,541

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$12,708,067 $13,253,976 $14,587,428 $0 $0 $0 $0 $0 $0$3,567,392 $3,861,770 $0 $0 $0 $0 $0 $0 $0

$16,275,458 $17,115,746 $14,587,428 $0 $0 $0 $0 $0 $0$13,222,806 $48,430,417 $36,357,064 $44,020,745 $45,341,367 $46,701,608 $48,102,656 $49,545,736 $51,032,108

($108,681,425) ($60,251,008) ($23,893,944) $20,126,801 $65,468,168 $112,169,776 $160,272,432 $209,818,168 $260,850,276

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,811,618 $9,196,206 $9,594,736 $0 $0 $0 $0 $0 $0

($7,056,674) ($7,692,062) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)$1,754,944 $1,504,143 $1,239,750 ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)

$14,977,750 $49,934,561 $37,596,814 $35,665,759 $36,986,381 $38,346,622 $39,747,670 $41,190,750 $42,677,122($10,438,221) $39,496,340 $77,093,154 $112,758,912 $149,745,294 $188,091,916 $227,839,586 $269,030,336 $311,707,459

Year


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Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$14,277,839 $14,277,839 $14,277,839 $142,778,393

$0 $0 $0 $0$0 $0 $0 $0

$26,763,319 $26,763,319 $26,763,319 $267,633,194$59,449,067 $61,232,539 $63,069,515 $649,616,008

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$52,563,071 $54,139,963 $55,764,162 $574,370,871$313,413,347 $367,553,311 $423,317,473 $997,688,344

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)

$44,208,085 $45,906,228 $47,974,982 $554,936,133$355,915,544 $401,821,772 $449,796,754 $1,004,732,888


Page 4 of 5

Notes:[1] Capitalized at 10%.








Page 5 of 5

SENSITIVITY 2 GRANT FUNDS, NO REPAYMENT

Table B3 - Sensitivity 2 Senstivity 2 - Outside GrantSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007


REVENUESNew Construction Ground Lease Revenue $55,437,142 $305,250,276Interim Leasing Income $10,623,793 $15,950,000Proposition A Park Bond $10,000,000 $10,000,000Other Bonds $33,956,900 $40,000,000Infrastructure Financing District Bond (65% of T.I.) $29,880,245 $95,699,330Infrastructure Financing Pay As You Go $4,014,218 $15,452,455

Total Revenues $143,912,297 $482,352,060



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $24,199,503 $41,986,485



Value of CFD $12,893,832 ($4,503,925)






Table B4 - Sensitivity 2 Senstivity 2 - Outside GrantDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 $4,599,633New Construction Ground Lease plus reversion value (2009$) [2] $433,750,830 $0 $318,568 $1,439,530 $2,241,924 $3,044,318 $3,846,713 $4,649,107 $5,451,501 $6,253,896Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000 $870,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0 $0Other Funds (2009$) $40,000,000 $0 $20,000,000 $20,000,000 $0 $0 $0 $0 $0 $0









Total IFD Proceeds (inflated) $160,841,744 $0 $0 $60,840 $3,208,528 $6,877,074 $5,366,329 $7,093,280 $7,095,091 $7,285,871NET REVENUE BEFORE PROP D $976,901,788 ($13,137,002) ($11,538,505) $6,304,479 ($7,557,651) ($50,114,989) ($14,013,770) ($20,925,817) ($478,666) ($10,188,769)CUMULATIVE ($13,137,002) ($24,675,507) ($18,371,028) ($25,928,680) ($76,043,669) ($90,057,439) ($110,983,255) ($111,461,922) ($121,650,691)




NET REVENUE AFTER PROP D AND CFD [11] $983,946,332 ($13,137,002) ($11,538,505) $6,304,479 ($5,924,004) ($44,246,575) $38,649,299 ($17,051,491) $3,272,622 ($6,568,995)CUMULATIVE ($13,137,002) ($24,675,507) ($18,371,028) ($24,295,033) ($68,541,608) ($29,892,309) ($46,943,800) ($43,671,178) ($50,240,173)

FactorYear


Page 1 of 5



REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239New Construction Ground Lease plus reversion value (2009$) [2] $433,750,830Interim Leasing Income (2009$) [3] $15,950,000Proposition A Park Bond (2009$) $10,000,000Other Funds (2009$) $40,000,000








Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8] $137,748,024IFD Pay As You Go (inflated) $23,093,720





NET REVENUE AFTER PROP D AND CFD [11] $983,946,332CUMULATIVE

Factor

Senstivity 2 - Outside Grant

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$7,056,290 $7,858,684 $8,661,079 $9,463,473 $10,265,868 $11,068,262 $11,870,656 $12,673,051 $13,475,445

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$13,189,346 $13,812,844 $15,206,612 $16,032,795 $20,809,151 $21,802,795 $23,987,550 $24,789,945 $25,592,339$17,209,104 $18,563,307 $21,049,508 $22,858,933 $30,558,939 $32,978,684 $37,371,822 $39,780,584 $42,300,237

$0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858 $4,500,000 $12,477,902

$153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243 $225,000 $623,895$122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594 $180,000 $499,116$613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972 $900,000 $2,495,580$889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666 $8,905,000 $19,196,493$15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651 $14,289,911 $31,728,878

$6,261,567 $7,382,464 $6,751,154 $7,221,416 $7,272,951 $12,587,553 $8,142,613 $10,210,476 $8,767,482$960,700 $1,096,940 $1,242,670 $1,389,440 $1,643,460 $1,807,780 $2,013,830 $2,190,760 $2,375,360

$7,222,267 $8,479,404 $7,993,824 $8,610,856 $8,916,411 $14,395,333 $10,156,443 $12,401,236 $11,142,842$8,855,618 ($14,361,896) $13,805,408 ($95,073,462) $13,782,245 ($6,030,215) $11,818,614 $37,891,910 $21,714,201

($112,795,073) ($127,156,969) ($113,351,561) ($208,425,023) ($194,642,778) ($200,672,993) ($188,854,379) ($150,962,469) ($129,248,269)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,907,628 $6,185,467 $6,473,654 $6,772,539 $7,082,484 $7,403,863 $7,737,061 $8,082,477 $8,440,521

($2,428,194) ($2,855,563) ($3,302,843) ($3,770,775) ($4,260,121) ($4,771,672) ($5,306,244) ($5,864,682) ($6,447,858)$3,479,434 $3,329,904 $3,170,811 $3,001,764 $2,822,363 $2,632,191 $2,430,817 $2,217,795 $1,992,663

$12,335,051 ($11,031,992) $16,976,218 ($92,071,698) $16,604,608 ($3,398,023) $14,249,431 $40,109,704 $23,706,864($37,905,121) ($48,937,113) ($31,960,895) ($124,032,593) ($107,427,984) ($110,826,008) ($96,576,577) ($56,466,872) ($32,760,009)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$26,394,733 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319$44,935,267 $46,929,643 $48,337,532 $49,787,658 $51,281,288 $52,819,726 $54,404,318 $56,036,447 $57,717,541

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$9,147,556 $9,540,515 $10,500,364 $0 $0 $0 $0 $0 $0$2,567,890 $2,779,790 $0 $0 $0 $0 $0 $0 $0

$11,715,446 $12,320,305 $10,500,364 $0 $0 $0 $0 $0 $0$8,662,794 $43,634,976 $32,269,999 $44,020,745 $45,341,367 $46,701,608 $48,102,656 $49,545,736 $51,032,108

($120,585,475) ($76,950,499) ($44,680,499) ($659,755) $44,681,612 $91,383,220 $139,485,876 $189,031,612 $240,063,720

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,811,618 $9,196,206 $9,594,736 $0 $0 $0 $0 $0 $0

($7,056,674) ($7,692,062) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)$1,754,944 $1,504,143 $1,239,750 ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)

$10,417,738 $45,139,119 $33,509,749 $35,665,759 $36,986,381 $38,346,622 $39,747,670 $41,190,750 $42,677,122($22,342,270) $22,796,849 $56,306,598 $91,972,357 $128,958,738 $167,305,360 $207,053,031 $248,243,781 $290,920,903

Year


Page 3 of 5

















Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$14,277,839 $14,277,839 $14,277,839 $142,778,393

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$26,763,319 $26,763,319 $26,763,319 $267,633,194$59,449,067 $61,232,539 $63,069,515 $649,616,008

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$52,563,071 $54,139,963 $55,764,162 $574,370,871$292,626,792 $346,766,755 $402,530,917 $976,901,788

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)

$44,208,085 $45,906,228 $47,974,982 $554,936,133$335,128,988 $381,035,216 $429,010,199 $983,946,332


Page 4 of 5









Page 5 of 5

SENSITIVITY 3 PUBLIC LOAN

Table B5 - Sensitivity 3 Sensitivity 3 - Public LoanSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007


REVENUESNew Construction Ground Lease Revenue $55,437,142 $305,250,276Interim Leasing Income $10,623,793 $15,950,000Proposition A Park Bond $10,000,000 $10,000,000Additional Public Debt (less debt service) (2009$) $18,235,704 ($20,032,032)Infrastructure Financing District Bond (65% of T.I.) $29,880,245 $95,699,330Infrastructure Financing Pay As You Go $4,014,218 $15,452,455

Total Revenues $128,191,101 $422,320,028



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $24,199,503 $41,986,485



Value of CFD $12,893,832 ($4,503,925)





Economic & Planning Systems, Inc. 1/11/2010 P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls

Table B6 - Sensitivity 3 Sensitivity 3 - Public LoanDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item NPV (at 15%) Total (Yrs 0-30) 0 1 2 3 4 5 6 7

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677New Construction Ground Lease plus reversion value (2009$) [2] $433,750,830 $0 $318,568 $1,439,530 $2,241,924 $3,044,318 $3,846,713 $4,649,107 $5,451,501Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0Additional Public Debt (less debt service) (2009$) [4] $957,594 $0 $20,000,000 $18,630,429 ($2,659,362) ($2,581,905) ($2,506,704) ($2,433,693) ($2,362,809)

Total Revenues (2009$) $835,973,069 $10,000,000 $23,218,568 $24,057,399 $3,381,680 $3,971,532 $5,920,637 $7,427,494 $8,710,370Total Revenues (inflated) 3.0% /yr $140,272,607 $1,582,715,865 $10,000,000 $23,915,125 $25,522,494 $3,695,254 $4,469,994 $6,863,641 $8,868,816 $10,712,656

EXPENDITURESSitework Costs (2009$)Demolition $4,317,725 $0 $0 $1,439,242 $1,439,242 $1,439,242 $0 $0 $0Infrastructure [5] $46,000,000 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $6,133,333 $3,066,667 $3,066,667 $3,066,667Structured Parking [6] 1,733 spaces $23,933,705 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $74,251,430 $6,133,333 $6,133,333 $7,572,575 $7,572,575 $7,572,575 $3,066,667 $3,066,667 $3,066,667Waterfront Improvements (2009$)Remediation $15,000,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $0 $0Park Space and Open Space $22,874,663 $7,751,940 $0 $0 $0 $0 $0 $0 $6,033,769Piers/Wharfs $45,000,000 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $82,874,663 $10,251,940 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $2,500,000 $0 $6,033,769Total Development Cost (2009$) $157,126,093 $16,385,273 $8,633,333 $10,072,575 $10,072,575 $10,072,575 $5,566,667 $3,066,667 $9,100,435Soft Costs (constant 2009$)Planning & Entitlement [7] 5% of development cost $9,856,305 $2,819,264 $431,667 $503,629 $503,629 $503,629 $278,333 $153,333 $455,022Project Management 4% of development cost $6,285,044 $655,411 $345,333 $402,903 $402,903 $402,903 $222,667 $122,667 $364,017Contingency 20% of development cost $31,425,219 $3,277,055 $1,726,667 $2,014,515 $2,014,515 $2,014,515 $1,113,333 $613,333 $1,820,087

Subtotal $47,566,567 $6,751,729 $2,503,667 $2,921,047 $2,921,047 $2,921,047 $1,614,333 $889,333 $2,639,126Rehabilitated Building Feasibility Gap Rehabilitation [8] $355,060,817 $0 $25,480,000 $4,560,150 $0 $51,620,656 $18,829,730 $33,088,424 $2,989,718(Less) Historic Tax Credits 20% of rehab cost ($71,012,163) $0 ($5,096,000) ($912,030) $0 ($10,324,131) ($3,765,946) ($6,617,685) ($597,944)

Subtotal $284,048,654 $0 $20,384,000 $3,648,120 $0 $41,296,525 $15,063,784 $26,470,739 $2,391,775Ongoing Remediation Monitoring (2009$) [1] $6,600,000 $0 $0 $0 $0 $0 $0 $0 $200,000Base Rent To The Port (2009$) [1] $113,100,000 $0 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

Total Expenditures (2009$) $608,441,313 $23,137,002 $34,421,000 $19,541,742 $15,893,622 $57,190,146 $25,144,784 $33,326,739 $17,231,336Total Expenditures (inflated) 3.0% /yr $239,853,903 $867,109,378 $23,137,002 $35,453,630 $20,731,834 $17,367,390 $64,368,014 $29,149,696 $39,793,869 $21,192,370

Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [9] $29,880,245 $137,748,024 $0 $0 $0 $3,014,828 $6,583,664 $4,940,969 $6,538,570 $6,409,731IFD Pay As You Go (inflated) $4,014,218 $23,093,720 $0 $0 $60,840 $193,700 $293,410 $425,360 $554,710 $685,360

Total IFD Proceeds (inflated) $33,894,463 $160,841,744 $0 $0 $60,840 $3,208,528 $6,877,074 $5,366,329 $7,093,280 $7,095,091NET REVENUE BEFORE PROP D ($65,686,834) $876,448,232 ($13,137,002) ($11,538,505) $4,851,501 ($10,463,608) ($53,020,946) ($16,919,726) ($23,831,773) ($3,384,623)CUMULATIVE ($13,137,002) ($24,675,507) ($19,824,007) ($30,287,614) ($83,308,560) ($100,228,286) ($124,060,059) ($127,444,682)

PROP DBond Proceeds (inflated) [10] $24,199,503 $48,673,844 $0 $0 $0 $0 $0 $48,673,844 $0 $0

Public Financing Available NowGrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Mello-Roos CFD (inflated) $25,957,699 $120,924,765 $0 $0 $0 $1,754,897 $6,434,220 $4,893,108 $5,132,850 $5,381,643(Less) CFD Value Reduction @ 75% [11] ($13,063,867) ($162,554,065) $0 $0 $0 ($121,250) ($565,806) ($903,883) ($1,258,524) ($1,630,355)

Total Public Financing (inflated) $12,893,832 ($41,629,300) $0 $0 $0 $1,633,647 $5,868,414 $3,989,225 $3,874,326 $3,751,288

NET REVENUE AFTER PROP D AND CFD [12] ($28,593,500) $883,492,775 ($13,137,002) ($11,538,505) $4,851,501 ($8,829,961) ($47,152,532) $35,743,343 ($19,957,447) $366,666CUMULATIVE ($13,137,002) ($24,675,507) ($19,824,007) ($28,653,968) ($75,806,499) ($40,063,157) ($60,020,604) ($59,653,938)

FactorYear

Economic & Planning Systems, Inc. 1/11/2010P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls

Page 1 of 5


Item NPV (at 15%) Total (Yrs 0-30)

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239New Construction Ground Lease plus reversion value (2009$) [2] $433,750,830Interim Leasing Income (2009$) [3] $15,950,000Proposition A Park Bond (2009$) $10,000,000Additional Public Debt (less debt service) (2009$) [4] $957,594

Total Revenues (2009$) $835,973,069Total Revenues (inflated) 3.0% /yr $140,272,607 $1,582,715,865






Total Expenditures (2009$) $608,441,313Total Expenditures (inflated) 3.0% /yr $239,853,903 $867,109,378

Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [9] $29,880,245 $137,748,024IFD Pay As You Go (inflated) $4,014,218 $23,093,720

Total IFD Proceeds (inflated) $33,894,463 $160,841,744NET REVENUE BEFORE PROP D ($65,686,834) $876,448,232CUMULATIVE

PROP DBond Proceeds (inflated) [10] $24,199,503 $48,673,844

Public Financing Available NowGrants $0 $0Mello-Roos CFD (inflated) $25,957,699 $120,924,765(Less) CFD Value Reduction @ 75% [11] ($13,063,867) ($162,554,065)

Total Public Financing (inflated) $12,893,832 ($41,629,300)

NET REVENUE AFTER PROP D AND CFD [12] ($28,593,500) $883,492,775CUMULATIVE

Factor

Sensitivity 3 - Public Loan

8 9 10 11 12 13 14 15

$4,599,633 $5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894$6,253,896 $7,056,290 $7,858,684 $8,661,079 $9,463,473 $10,265,868 $11,068,262 $11,870,656

$870,000 $580,000 $290,000 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0($2,293,989) ($2,227,174) ($2,162,305) ($2,099,325) ($2,038,179) ($1,978,815) ($1,921,180) ($1,865,223)

$9,429,540 $10,962,172 $11,650,539 $13,107,287 $13,994,616 $18,830,336 $19,881,615 $22,122,328$11,945,059 $14,303,148 $15,657,350 $18,143,551 $19,952,976 $27,652,983 $30,072,727 $34,465,865

$0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $3,066,667 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $7,977,902 $0 $0 $7,977,902$3,066,667 $3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $926,374 $0 $0 $5,275,624 $0 $2,886,956$0 $0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000$0 $0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956

$3,066,667 $3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858

$153,333 $153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243$122,667 $122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594$613,333 $613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972$889,333 $889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809

$23,077,713 $6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0($4,615,543) ($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0$18,462,171 $4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$25,518,171 $11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666$32,325,655 $15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651

$6,474,151 $6,261,567 $7,382,464 $6,751,154 $7,221,416 $7,272,951 $12,587,553 $8,142,613$811,720 $960,700 $1,096,940 $1,242,670 $1,389,440 $1,643,460 $1,807,780 $2,013,830

$7,285,871 $7,222,267 $8,479,404 $7,993,824 $8,610,856 $8,916,411 $14,395,333 $10,156,443($13,094,726) $5,949,661 ($17,267,852) $10,899,451 ($97,979,419) $10,876,289 ($8,936,171) $8,912,657

($140,539,408) ($134,589,747) ($151,857,599) ($140,958,148) ($238,937,566) ($228,061,278) ($236,997,449) ($228,084,791)

$0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0$5,639,796 $5,907,628 $6,185,467 $6,473,654 $6,772,539 $7,082,484 $7,403,863 $7,737,061

($2,020,022) ($2,428,194) ($2,855,563) ($3,302,843) ($3,770,775) ($4,260,121) ($4,771,672) ($5,306,244)$3,619,774 $3,479,434 $3,329,904 $3,170,811 $3,001,764 $2,822,363 $2,632,191 $2,430,817

($9,474,951) $9,429,095 ($13,937,948) $14,070,262 ($94,977,654) $13,698,652 ($6,303,980) $11,343,474($69,128,890) ($59,699,795) ($73,637,743) ($59,567,481) ($154,545,135) ($140,846,483) ($147,150,463) ($135,806,989)

Year


Page 2 of 5

















Factor


16 17 18 19 20 21 22 23

$12,116,894 $12,116,894 $12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$12,673,051 $13,475,445 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839

$0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0($1,810,896) ($1,758,151) ($1,706,943) ($1,657,226) ($1,608,958) ($1,562,095) ($1,516,597) ($1,472,424)

$22,979,049 $23,834,188 $24,687,790 $25,106,093 $25,154,362 $25,201,225 $25,246,723 $25,290,895$36,874,628 $39,394,281 $42,029,310 $44,023,686 $45,431,575 $46,881,701 $48,375,331 $49,913,770

$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0$0 $7,977,902 $0 $0 $0 $0 $0 $0$0 $7,977,902 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $4,500,000 $4,500,000 $9,000,000 $0 $0 $0$4,500,000 $4,500,000 $4,500,000 $4,500,000 $9,000,000 $0 $0 $0$4,500,000 $12,477,902 $4,500,000 $4,500,000 $9,000,000 $0 $0 $0

$225,000 $623,895 $225,000 $225,000 $450,000 $0 $0 $0$180,000 $499,116 $180,000 $180,000 $360,000 $0 $0 $0$900,000 $2,495,580 $900,000 $900,000 $1,800,000 $0 $0 $0

$1,305,000 $3,618,591 $1,305,000 $1,305,000 $2,610,000 $0 $0 $0

$0 $0 $24,103,556 $0 $0 $0 $0 $0$0 $0 ($4,820,711) $0 $0 $0 $0 $0$0 $0 $19,282,845 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$8,905,000 $19,196,493 $28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000$14,289,911 $31,728,878 $47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118

$10,210,476 $8,767,482 $9,147,556 $9,540,515 $10,500,364 $0 $0 $0$2,190,760 $2,375,360 $2,567,890 $2,779,790 $0 $0 $0 $0

$12,401,236 $11,142,842 $11,715,446 $12,320,305 $10,500,364 $0 $0 $0$34,985,953 $18,808,244 $5,756,838 $40,729,019 $29,364,043 $41,114,788 $42,435,411 $43,795,652

($193,098,838) ($174,290,594) ($168,533,756) ($127,804,737) ($98,440,694) ($57,325,906) ($14,890,495) $28,905,156

$0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0$8,082,477 $8,440,521 $8,811,618 $9,196,206 $9,594,736 $0 $0 $0

($5,864,682) ($6,447,858) ($7,056,674) ($7,692,062) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)$2,217,795 $1,992,663 $1,754,944 $1,504,143 $1,239,750 ($8,354,986) ($8,354,986) ($8,354,986)

$37,203,748 $20,800,907 $7,511,782 $42,233,163 $30,603,793 $32,759,802 $34,080,425 $35,440,666($98,603,241) ($77,802,334) ($70,290,552) ($28,057,389) $2,546,403 $35,306,206 $69,386,630 $104,827,296


Page 3 of 5

















Factor


24 25 26 27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $124,854,801$14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $142,778,393

$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0($1,429,538) ($1,387,901) ($1,347,477) ($1,308,230) ($1,270,126) ($1,233,132) ($8,462,107)

$25,333,781 $25,375,418 $25,415,843 $25,455,090 $25,493,193 $25,530,187 $259,171,087$51,498,361 $53,130,491 $54,811,584 $56,543,111 $58,326,583 $60,163,559 $629,076,254

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $31,000,000$6,301,662 $6,490,712 $6,685,433 $6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

$45,196,700 $46,639,779 $48,126,152 $49,657,115 $51,234,007 $52,858,206 $553,831,117$74,101,856 $120,741,636 $168,867,787 $218,524,902 $269,758,909 $322,617,114 $876,448,232

$0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0

($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)

$36,841,714 $38,284,794 $39,771,166 $41,302,129 $43,000,271 $45,069,026 $534,396,379$141,669,010 $179,953,804 $219,724,970 $261,027,099 $304,027,370 $349,096,396 $883,492,775

Year


Page 4 of 5


[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.[4] Assumed an annual debt service amortized over 30 years at 6 percent interest rate; the last several years of payments are rolled up into year 30.[5] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.[6] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per




Source: Economic & Planning Systems, Inc



Page 5 of 5

SENSITIVITY 4 GROUND LEASE SITE 1 FOR RENTAL RESIDENTIAL

Table B7 - Sensitivity 4 Sensitivity 4 - Ground Lease for Rental ResidentialSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007



Total Revenues $97,699,299 $405,429,368



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $21,926,684 $38,043,111



Value of CFD $10,592,753 ($2,912,269)






Table B8 - Sensitivity 4 Sensitivity 4 - Ground Lease for Rental ResidentialDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 $4,599,633New Construction Ground Lease plus reversion value (2009$) [2] $399,159,628 $0 $139,069 $642,627 $1,436,272 $2,229,918 $3,023,564 $3,817,209 $4,610,855 $5,404,501Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000 $870,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0 $0








Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8] $127,247,660 $0 $0 $0 $2,473,705 $141,723 $4,767,036 $6,351,754 $6,216,473 $6,287,334IFD Pay As You Go (inflated) $20,123,740 $0 $0 $49,920 $52,780 $148,980 $277,160 $402,610 $529,490 $651,820

Total IFD Proceeds (inflated) $147,371,400 $0 $0 $49,920 $2,526,485 $290,703 $5,044,196 $6,754,364 $6,745,963 $6,939,154NET REVENUE BEFORE PROP D $857,490,431 ($13,137,002) ($32,323,389) ($15,769,875) ($9,120,051) ($57,617,975) ($15,290,157) ($22,258,062) ($1,861,684) ($11,611,474)CUMULATIVE ($13,137,002) ($45,460,391) ($61,230,266) ($70,350,317) ($127,968,292) ($143,258,450) ($165,516,512) ($167,378,196) ($178,989,669)


Public Financing Available NowGrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Mello-Roos CFD (inflated) $110,467,034 $0 $0 $0 $1,212,793 $24,256 $4,714,655 $4,949,646 $5,193,557 $5,446,694(Less) CFD Value Reduction @ 75% [10] ($145,868,432) $0 $0 $0 ($83,795) ($85,471) ($411,218) ($753,201) ($1,112,036) ($1,488,361)

Total Public Financing (inflated) ($35,401,398) $0 $0 $0 $1,128,998 -$61,215 $4,303,437 $4,196,445 $4,081,521 $3,958,332


FactorYear


Page 1 of 5

















Factor

Sensitivity 4 - Ground Lease for Rental Residential

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$6,198,146 $6,991,792 $7,785,438 $8,579,083 $9,372,729 $10,166,374 $10,960,020 $11,753,666 $12,547,311

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$12,331,202 $12,945,951 $14,330,971 $15,148,405 $19,916,012 $20,900,907 $23,076,914 $23,870,560 $24,664,205$16,089,421 $17,398,276 $19,837,415 $21,598,004 $29,247,335 $31,614,498 $35,953,080 $38,305,241 $40,766,174

$0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858 $4,500,000 $12,477,902

$153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243 $225,000 $623,895$122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594 $180,000 $499,116$613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972 $900,000 $2,495,580$889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666 $8,905,000 $19,196,493$15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651 $14,289,911 $31,728,878

$6,061,866 $7,176,322 $6,538,570 $7,002,390 $7,060,367 $12,355,643 $7,904,262 $9,978,567 $8,522,688$796,640 $928,590 $1,069,900 $1,212,380 $1,461,720 $1,621,230 $1,822,600 $1,994,590 $2,174,120

$6,858,506 $8,104,912 $7,608,470 $8,214,770 $8,522,087 $13,976,873 $9,726,862 $11,973,157 $10,696,808$7,372,174 ($15,901,419) $12,207,961 ($96,730,477) $12,076,317 ($7,812,860) $9,970,291 $35,988,487 $19,734,103

($171,617,495) ($187,518,914) ($175,310,953) ($272,041,429) ($259,965,113) ($267,777,973) ($257,807,682) ($221,819,195) ($202,085,092)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,709,372 $5,981,915 $6,264,660 $6,557,954 $6,862,153 $7,177,627 $7,504,758 $7,843,939 $8,195,576

($1,882,836) ($2,296,141) ($2,728,982) ($3,182,086) ($3,656,209) ($4,152,129) ($4,670,651) ($5,212,608) ($5,778,860)$3,826,536 $3,685,774 $3,535,679 $3,375,867 $3,205,944 $3,025,498 $2,834,107 $2,631,331 $2,416,716

$11,198,710 ($12,215,645) $15,743,640 ($93,354,610) $15,282,260 ($4,787,362) $12,804,398 $38,619,818 $22,150,819($106,081,048) ($118,296,693) ($102,553,052) ($195,907,662) ($180,625,401) ($185,412,763) ($172,608,366) ($133,988,548) ($111,837,729)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$13,340,957 $13,340,957 $13,340,957 $13,340,957 $13,340,957 $13,340,957 $13,340,957 $13,340,957 $13,340,957

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$25,457,851 $25,826,437 $25,826,437 $25,826,437 $25,826,437 $25,826,437 $25,826,437 $25,826,437 $25,826,437$43,340,287 $45,286,814 $46,645,418 $48,044,781 $49,486,124 $50,970,708 $52,499,829 $54,074,824 $55,697,069

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$8,896,320 $9,276,395 $10,236,244 $0 $0 $0 $0 $0 $0$2,361,320 $2,567,890 $0 $0 $0 $0 $0 $0 $0

$11,257,640 $11,844,285 $10,236,244 $0 $0 $0 $0 $0 $0$6,610,009 $41,516,127 $30,313,766 $42,277,867 $43,546,204 $44,852,590 $46,198,167 $47,584,112 $49,011,636

($195,475,083) ($153,958,956) ($123,645,190) ($81,367,322) ($37,821,119) $7,031,471 $53,229,638 $100,813,751 $149,825,386

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,560,088 $8,937,909 $9,329,484 $0 $0 $0 $0 $0 $0

($6,370,297) ($6,987,839) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436)$2,189,791 $1,950,070 $1,697,049 ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436) ($7,632,436)

$8,799,800 $43,466,197 $32,010,815 $34,645,432 $35,913,768 $37,220,154 $38,565,732 $39,951,677 $41,379,200($103,037,929) ($59,571,732) ($27,560,918) $7,084,514 $42,998,282 $80,218,436 $118,784,167 $158,735,844 $200,115,044

Year


Page 3 of 5

















Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$13,340,957 $13,340,957 $13,340,957 $133,409,570

$0 $0 $0 $0$0 $0 $0 $0

$25,826,437 $25,826,437 $25,826,437 $258,264,371$57,367,981 $59,089,020 $60,861,691 $626,875,414

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$50,481,985 $51,996,444 $53,556,338 $551,630,278$200,307,371 $252,303,815 $305,860,153 $857,490,431

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($7,632,436) ($7,548,641) ($7,546,965) ($18,860,621)($7,632,436) ($7,548,641) ($7,546,965) ($18,860,621)

$42,849,549 $44,447,803 $46,009,373 $532,769,656$242,964,593 $287,412,396 $333,421,769 $866,191,425


Page 4 of 5









Page 5 of 5

SENSITIVITY 5 SELL SITE 1 FOR-SALE RESIDENTIAL

Table B9 - Sensitivity 5 Sensitivity 5 - Sell Land for ResidentialSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007



Total Revenues $100,394,044 $399,244,945



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $21,926,684 $38,043,111



Value of CFD $10,781,537 ($3,034,921)






Table B10 - Sensitivity 5 Sensitivity 5 - Sell Land for ResidentialDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 $4,599,633New Construction Ground Lease plus reversion value (2009$) [2] $380,024,441 $0 $139,069 $139,069 $932,715 $1,726,361 $2,520,006 $3,313,652 $4,107,297 $4,900,943Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000 $870,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0 $0For-Sale Residential Land Sales $7,632,138 $0 $0 $7,632,138 $0 $0 $0 $0 $0 $0








Required Public Financing (inflated)IFD Bond (65% of T.I.) (inflated) [8] $127,975,599 $0 $0 $0 $2,995,503 $154,607 $4,773,478 $6,364,638 $6,229,357 $6,293,776IFD Pay As You Go (inflated) $20,349,160 $0 $0 $60,450 $63,570 $159,900 $288,340 $414,050 $541,060 $663,650

Total IFD Proceeds (inflated) $148,324,759 $0 $0 $60,450 $3,059,073 $314,507 $5,061,818 $6,778,688 $6,770,417 $6,957,426NET REVENUE BEFORE PROP D $831,383,323 ($13,137,002) ($32,323,389) ($8,196,634) ($9,137,715) ($58,160,930) ($15,856,297) ($22,835,013) ($2,456,542) ($12,231,094)CUMULATIVE ($13,137,002) ($45,460,391) ($53,657,025) ($62,794,740) ($120,955,670) ($136,811,966) ($159,646,979) ($162,103,521) ($174,334,614)


Public Financing Available NowGrants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Mello-Roos CFD (inflated) $111,194,270 $0 $0 $0 $1,732,158 $34,643 $4,725,250 $4,960,452 $5,204,580 $5,457,937(Less) CFD Value Reduction @ 75% [10] ($147,048,245) $0 $0 $0 ($119,679) ($122,073) ($448,552) ($791,281) ($1,150,878) ($1,527,980)

Total Public Financing (inflated) ($35,853,976) $0 $0 $0 $1,612,479 -$87,429 $4,276,699 $4,169,171 $4,053,702 $3,929,957


FactorYear


Page 1 of 5



REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239New Construction Ground Lease plus reversion value (2009$) [2] $380,024,441Interim Leasing Income (2009$) [3] $15,950,000Proposition A Park Bond (2009$) $10,000,000For-Sale Residential Land Sales $7,632,138














Factor

Sensitivity 5 - Sell Land for Residential

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$5,694,589 $6,488,234 $7,281,880 $8,075,526 $8,869,171 $9,662,817 $10,456,463 $11,250,108 $12,043,754

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$11,827,644 $12,442,394 $13,827,413 $14,644,848 $19,412,454 $20,397,350 $22,573,357 $23,367,002 $24,160,648$15,432,393 $16,721,536 $19,140,374 $20,880,051 $28,507,844 $30,852,822 $35,168,554 $37,497,179 $39,933,870

$0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858 $4,500,000 $12,477,902

$153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243 $225,000 $623,895$122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594 $180,000 $499,116$613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972 $900,000 $2,495,580$889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666 $8,905,000 $19,196,493$15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651 $14,289,911 $31,728,878

$6,074,750 $7,189,206 $6,551,454 $7,015,274 $7,066,809 $12,374,969 $7,917,145 $9,991,450 $8,535,572$808,730 $940,940 $1,082,510 $1,225,120 $1,474,850 $1,634,620 $1,836,250 $2,008,500 $2,188,290

$6,883,480 $8,130,146 $7,633,964 $8,240,394 $8,541,659 $14,009,589 $9,753,395 $11,999,950 $10,723,862$6,740,120 ($16,552,925) $11,536,414 ($97,422,806) $11,356,397 ($8,541,820) $9,212,298 $35,207,219 $18,928,853

($167,594,494) ($184,147,419) ($172,611,005) ($270,033,811) ($258,677,413) ($267,219,233) ($258,006,935) ($222,799,717) ($203,870,863)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,720,840 $5,993,613 $6,276,592 $6,570,124 $6,874,567 $7,190,289 $7,517,673 $7,857,112 $8,209,013

($1,923,247) ($2,337,361) ($2,771,025) ($3,224,971) ($3,699,952) ($4,196,746) ($4,716,161) ($5,259,028) ($5,826,208)$3,797,593 $3,656,252 $3,505,567 $3,345,153 $3,174,615 $2,993,543 $2,801,513 $2,598,085 $2,382,804

$10,537,713 ($12,896,672) $15,041,981 ($94,077,653) $14,531,012 ($5,548,278) $12,013,811 $37,805,303 $21,311,658($101,739,931) ($114,636,604) ($99,594,623) ($193,672,276) ($179,141,264) ($184,689,541) ($172,675,730) ($134,870,427) ($113,558,769)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$12,837,399 $12,837,399 $12,837,399 $12,837,399 $12,837,399 $12,837,399 $12,837,399 $12,837,399 $12,837,399

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$24,954,294 $25,322,879 $25,322,879 $25,322,879 $25,322,879 $25,322,879 $25,322,879 $25,322,879 $25,322,879$42,483,014 $44,403,822 $45,735,937 $47,108,015 $48,521,256 $49,976,893 $51,476,200 $53,020,486 $54,611,101

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$8,909,204 $9,289,279 $10,249,128 $0 $0 $0 $0 $0 $0$2,375,750 $2,582,580 $0 $0 $0 $0 $0 $0 $0

$11,284,954 $11,871,859 $10,249,128 $0 $0 $0 $0 $0 $0$5,780,050 $40,660,710 $29,417,169 $41,341,102 $42,581,335 $43,858,775 $45,174,538 $46,529,775 $47,925,668

($198,090,813) ($157,430,103) ($128,012,934) ($86,671,832) ($44,090,497) ($231,722) $44,942,816 $91,472,591 $139,398,259

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,573,794 $8,951,889 $9,343,744 $0 $0 $0 $0 $0 $0

($6,418,593) ($7,037,100) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682)$2,155,201 $1,914,788 $1,661,062 ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682) ($7,682,682)

$7,935,251 $42,575,498 $31,078,231 $33,658,420 $34,898,653 $36,176,093 $37,491,856 $38,847,092 $40,242,986($105,623,518) ($63,048,020) ($31,969,789) $1,688,630 $36,587,283 $72,763,376 $110,255,233 $149,102,325 $189,345,311

Year


Page 3 of 5

















Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$12,837,399 $12,837,399 $12,837,399 $128,373,994

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$25,322,879 $25,322,879 $25,322,879 $253,228,795$56,249,434 $57,936,917 $59,675,024 $614,652,750

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$49,363,438 $50,844,341 $52,369,671 $539,407,614$188,761,697 $239,606,038 $291,975,709 $831,383,323

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($7,682,682) ($7,563,003) ($7,560,610) ($18,892,340)($7,682,682) ($7,563,003) ($7,560,610) ($18,892,340)

$41,680,756 $43,281,338 $44,809,062 $520,515,274$231,026,066 $274,307,404 $319,116,466 $839,631,740


Page 4 of 5









Page 5 of 5

SENSITIVITY 6 SELL SITE 1 FOR COMMERCIAL

Table B11 - Sensitivity 6 Sensitivity 6 - Sell Land for Commercial UseSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007



Total Revenues $112,680,360 $424,394,364



Subtotal $32,117,914 $82,874,663


Subtotal $22,934,449 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $24,199,503 $41,986,485



Value of CFD $13,220,037 ($4,715,858)






Table B12 - Sensitivity 6 Sensitivity 6 - Sell Land for Commercial UseDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8

REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239 $0 $0 $1,377,441 $1,479,118 $1,479,118 $2,840,628 $3,762,080 $4,461,677 $4,599,633New Construction Ground Lease plus reversion value (2009$) [2] $391,154,275 $0 $318,568 $318,568 $1,120,962 $1,923,356 $2,725,751 $3,528,145 $4,330,539 $5,132,934Interim Leasing Income (2009$) [3] $15,950,000 $0 $2,900,000 $2,610,000 $2,320,000 $2,030,000 $1,740,000 $1,450,000 $1,160,000 $870,000Proposition A Park Bond (2009$) $10,000,000 $10,000,000 $0 $0 $0 $0 $0 $0 $0 $0Commercial Land Sales (2009$) $13,187,788 $0 $0 $13,187,788 $0 $0 $0 $0 $0 $0









Total IFD Proceeds (inflated) $162,494,234 $0 $0 $79,040 $4,128,990 $6,915,380 $5,405,025 $7,132,236 $7,128,125 $7,332,178NET REVENUE BEFORE PROP D $872,463,835 ($13,137,002) ($32,138,505) ($2,093,625) ($7,862,095) ($51,338,336) ($15,274,576) ($22,225,348) ($1,824,274) ($11,562,463)CUMULATIVE ($13,137,002) ($45,275,507) ($47,369,133) ($55,231,228) ($106,569,564) ($121,844,140) ($144,069,488) ($145,893,762) ($157,456,225)





FactorYear


Page 1 of 5



REVENUESRehabilitated Building Lease plus reversion value (2009$) [1] $376,272,239New Construction Ground Lease plus reversion value (2009$) [2] $391,154,275Interim Leasing Income (2009$) [3] $15,950,000Proposition A Park Bond (2009$) $10,000,000Commercial Land Sales (2009$) $13,187,788














Factor

Sensitivity 6 - Sell Land for Commercial Use

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$5,935,328 $6,737,722 $7,540,117 $8,342,511 $9,144,906 $9,947,300 $10,749,694 $11,552,089 $12,354,483

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$12,068,384 $12,691,882 $14,085,650 $14,911,833 $19,688,189 $20,681,833 $22,866,588 $23,668,983 $24,471,377$15,746,503 $17,056,828 $19,497,834 $21,260,709 $28,912,769 $31,283,128 $35,625,400 $37,981,769 $40,447,458

$0 $0 $0 $0 $0 $0 $0 $0 $0$3,066,667 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$3,066,667 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000$0 $926,374 $4,500,000 $0 $9,775,624 $4,500,000 $7,386,956 $4,500,000 $4,500,000

$3,066,667 $926,374 $4,500,000 $7,977,902 $9,775,624 $4,500,000 $15,364,858 $4,500,000 $12,477,902

$153,333 $46,319 $225,000 $398,895 $488,781 $225,000 $768,243 $225,000 $623,895$122,667 $37,055 $180,000 $319,116 $391,025 $180,000 $614,594 $180,000 $499,116$613,333 $185,275 $900,000 $1,595,580 $1,955,125 $900,000 $3,072,972 $900,000 $2,495,580$889,333 $268,649 $1,305,000 $2,313,591 $2,834,931 $1,305,000 $4,455,809 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$11,937,518 $30,808,916 $11,008,201 $88,754,890 $17,495,754 $35,306,488 $22,920,666 $8,905,000 $19,196,493$15,575,753 $41,404,607 $15,237,924 $126,543,251 $25,693,105 $53,404,231 $35,709,651 $14,289,911 $31,728,878

$6,280,892 $7,401,790 $6,770,480 $7,240,742 $7,298,719 $12,606,878 $8,161,939 $10,236,244 $8,793,249$981,630 $1,118,260 $1,264,380 $1,411,670 $1,666,080 $1,830,790 $2,037,360 $2,214,810 $2,399,930

$7,262,522 $8,520,050 $8,034,860 $8,652,412 $8,964,799 $14,437,668 $10,199,299 $12,451,054 $11,193,179$7,433,272 ($15,827,729) $12,294,770 ($96,630,130) $12,184,463 ($7,683,434) $10,115,047 $36,142,912 $19,911,759

($150,022,952) ($165,850,682) ($153,555,911) ($250,186,042) ($238,001,579) ($245,685,013) ($235,569,966) ($199,427,053) ($179,515,294)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,927,444 $6,205,680 $6,494,271 $6,793,569 $7,103,934 $7,425,742 $7,759,378 $8,105,240 $8,463,739

($2,498,022) ($2,926,788) ($3,375,493) ($3,844,877) ($4,335,705) ($4,848,767) ($5,384,882) ($5,944,892) ($6,529,673)$3,429,422 $3,278,893 $3,118,779 $2,948,692 $2,768,229 $2,576,975 $2,374,496 $2,160,347 $1,934,067

$10,862,695 ($12,548,837) $15,413,549 ($93,681,438) $14,952,692 ($5,106,460) $12,489,544 $38,303,260 $21,845,826($74,583,319) ($87,132,156) ($71,718,607) ($165,400,045) ($150,447,353) ($155,553,813) ($143,064,270) ($104,761,010) ($82,915,184)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$13,156,877 $13,156,877 $13,156,877 $13,156,877 $13,156,877 $13,156,877 $13,156,877 $13,156,877 $13,156,877

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$25,273,772 $25,642,357 $25,642,357 $25,642,357 $25,642,357 $25,642,357 $25,642,357 $25,642,357 $25,642,357$43,026,904 $44,964,029 $46,312,950 $47,702,338 $49,133,408 $50,607,411 $52,125,633 $53,689,402 $55,300,084

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$9,173,324 $9,559,840 $10,526,132 $0 $0 $0 $0 $0 $0$2,592,850 $2,805,270 $0 $0 $0 $0 $0 $0 $0

$11,766,174 $12,365,110 $10,526,132 $0 $0 $0 $0 $0 $0$6,805,159 $41,714,168 $30,271,185 $41,935,425 $43,193,488 $44,489,293 $45,823,971 $47,198,690 $48,614,651

($172,710,135) ($130,995,967) ($100,724,782) ($58,789,357) ($15,595,869) $28,893,424 $74,717,395 $121,916,085 $170,530,737

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,835,301 $9,220,362 $9,619,375 $0 $0 $0 $0 $0 $0

($7,140,125) ($7,777,182) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808)$1,695,176 $1,443,180 $1,177,567 ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808) ($8,441,808)

$8,500,335 $43,157,348 $31,448,752 $33,493,617 $34,751,680 $36,047,484 $37,382,163 $38,756,882 $40,172,843($74,414,849) ($31,257,501) $191,251 $33,684,868 $68,436,548 $104,484,032 $141,866,195 $180,623,078 $220,795,921

Year


Page 3 of 5

















Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$13,156,877 $13,156,877 $13,156,877 $131,568,774

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$25,642,357 $25,642,357 $25,642,357 $256,423,574$56,959,087 $58,667,859 $60,427,895 $622,407,319

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$50,073,091 $51,575,283 $53,122,542 $547,162,182$220,603,827 $272,179,111 $325,301,653 $872,463,835

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($8,441,808) ($8,258,553) ($7,812,757) ($19,489,544)($8,441,808) ($8,258,553) ($7,812,757) ($19,489,544)

$41,631,283 $43,316,731 $45,309,785 $527,672,638$262,427,204 $305,743,934 $351,053,719 $878,726,357


Page 4 of 5









Page 5 of 5

SENSITIVITY 7 MATCH RATE OF NEW DEVELOPMENT ABSORPTION WITH

INFRASTRUCTURE COST OUTLAYS

Table B13 - Sensitivity 7 Sensitivity 7 - Spread CostsSources and Uses TablePier 70 Financial Feasibility Analysis; EPS #17007



Total Revenues $109,955,397 $442,352,060



Subtotal $27,376,987 $82,874,663


Subtotal $18,017,536 $47,566,567


Subtotal $72,930,531 $20,145,735





PROP D Bond $24,199,503 $41,986,485



Value of CFD $12,893,832 ($4,503,925)






Table B14 - Sensitivity 7 Sensitivity 7 - Spread CostsDevelopment Cash FlowPier 70 Financial Feasibility Analysis; EPS #17007

Item Total (Yrs 0-30) 0 1 2 3 4 5 6 7 8



EXPENDITURESSitework Costs (2009$)Demolition $4,317,725 $104,238 $337,241 $233,003 $233,003 $233,003 $233,003 $233,003 $233,003 $233,003Infrastructure [4] $46,000,000 $1,110,529 $3,592,887 $2,482,358 $2,482,358 $2,482,358 $2,482,358 $2,482,358 $2,482,358 $2,482,358Structured Parking [5] 1,733 spaces $23,933,705 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $74,251,430 $1,214,767 $3,930,128 $2,715,361 $2,715,361 $2,715,361 $2,715,361 $2,715,361 $2,715,361 $2,715,361Waterfront Improvements (2009$)Remediation $15,000,000 $362,129 $1,171,594 $809,465 $809,465 $809,465 $809,465 $809,465 $809,465 $809,465Park Space and Open Space $22,874,663 $7,751,940 $0 $0 $0 $0 $0 $0 $6,033,769 $0Piers/Wharfs $45,000,000 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $82,874,663 $8,114,068 $1,171,594 $809,465 $809,465 $809,465 $809,465 $809,465 $6,843,233 $809,465Total Development Cost (2009$) $157,126,093 $9,328,835 $5,101,722 $3,524,826 $3,524,826 $3,524,826 $3,524,826 $3,524,826 $9,558,595 $3,524,826Soft Costs (constant 2009$)Planning & Entitlement [6] 5% of development cost $9,856,305 $2,466,442 $255,086 $176,241 $176,241 $176,241 $176,241 $176,241 $477,930 $176,241Project Management 4% of development cost $6,285,044 $373,153 $204,069 $140,993 $140,993 $140,993 $140,993 $140,993 $382,344 $140,993Contingency 20% of development cost $31,425,219 $1,865,767 $1,020,344 $704,965 $704,965 $704,965 $704,965 $704,965 $1,911,719 $704,965

Subtotal $47,566,567 $4,705,362 $1,479,499 $1,022,200 $1,022,200 $1,022,200 $1,022,200 $1,022,200 $2,771,993 $1,022,200Rehabilitated Building Feasibility Gap Rehabilitation [7] $355,060,817 $0 $25,480,000 $4,560,150 $0 $51,620,656 $18,829,730 $33,088,424 $2,989,718 $23,077,713(Less) Historic Tax Credits 20% of rehab cost ($71,012,163) $0 ($5,096,000) ($912,030) $0 ($10,324,131) ($3,765,946) ($6,617,685) ($597,944) ($4,615,543)




Total IFD Proceeds (inflated) $160,841,744 $0 $0 $60,840 $3,208,528 $6,877,074 $5,366,329 $7,093,280 $7,095,091 $7,285,871NET REVENUE BEFORE PROP D $919,789,532 ($4,034,198) ($27,446,053) ($5,952,527) $1,672,172 ($40,608,271) ($10,960,271) ($21,631,532) ($1,205,553) ($10,937,463)CUMULATIVE ($4,034,198) ($31,480,251) ($37,432,779) ($35,760,606) ($76,368,877) ($87,329,149) ($108,960,681) ($110,166,234) ($121,103,697)




NET REVENUE AFTER PROP D AND CFD [11] $926,834,076 ($4,034,198) ($27,446,053) ($5,952,527) $3,305,819 ($34,739,857) $41,702,797 ($17,757,206) $2,545,735 ($7,317,689)CUMULATIVE ($4,034,198) ($31,480,251) ($37,432,779) ($34,126,959) ($68,866,816) ($27,164,019) ($44,921,225) ($42,375,490) ($49,693,179)

FactorYear


Page 1 of 5

















Factor

Sensitivity 7 - Spread Costs

9 10 11 12 13 14 15 16 17

$5,553,056 $5,664,159 $6,545,533 $6,569,322 $10,543,283 $10,734,533 $12,116,894 $12,116,894 $12,116,894$7,056,290 $7,858,684 $8,661,079 $9,463,473 $10,265,868 $11,068,262 $11,870,656 $12,673,051 $13,475,445

$580,000 $290,000 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$13,189,346 $13,812,844 $15,206,612 $16,032,795 $20,809,151 $21,802,795 $23,987,550 $24,789,945 $25,592,339$17,209,104 $18,563,307 $21,049,508 $22,858,933 $30,558,939 $32,978,684 $37,371,822 $39,780,584 $42,300,237

$233,003 $233,003 $540,104 $233,003 $233,003 $540,104 $233,003 $0 $0$2,482,358 $2,482,358 $5,754,142 $2,482,358 $2,482,358 $5,754,142 $2,482,358 $0 $0

$0 $0 $0 $7,977,902 $0 $0 $7,977,902 $0 $7,977,902$2,715,361 $2,715,361 $6,294,246 $10,693,263 $2,715,361 $6,294,246 $10,693,263 $0 $7,977,902

$809,465 $809,465 $1,876,351 $809,465 $809,465 $1,876,351 $809,465 $0 $0$0 $926,374 $0 $0 $5,275,624 $0 $2,886,956 $0 $0$0 $0 $4,500,000 $0 $4,500,000 $4,500,000 $4,500,000 $4,500,000 $4,500,000

$809,465 $1,735,839 $6,376,351 $809,465 $10,585,089 $6,376,351 $8,196,421 $4,500,000 $4,500,000$3,524,826 $4,451,201 $12,670,597 $11,502,728 $13,300,450 $12,670,597 $18,889,684 $4,500,000 $12,477,902

$176,241 $222,560 $633,530 $575,136 $665,023 $633,530 $944,484 $225,000 $623,895$140,993 $178,048 $506,824 $460,109 $532,018 $506,824 $755,587 $180,000 $499,116$704,965 $890,240 $2,534,119 $2,300,546 $2,660,090 $2,534,119 $3,777,937 $900,000 $2,495,580

$1,022,200 $1,290,848 $3,674,473 $3,335,791 $3,857,131 $3,674,473 $5,478,008 $1,305,000 $3,618,591

$6,101,898 $33,142,366 $2,629,001 $94,204,246 $2,231,499 $33,001,860 $0 $0 $0($1,220,380) ($6,628,473) ($525,800) ($18,840,849) ($446,300) ($6,600,372) $0 $0 $0$4,881,518 $26,513,893 $2,103,201 $75,363,397 $1,785,199 $26,401,488 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$12,528,544 $35,355,942 $21,548,270 $93,301,916 $22,042,780 $45,846,558 $27,467,692 $8,905,000 $19,196,493$16,346,908 $47,515,429 $29,827,846 $133,026,222 $32,370,566 $69,347,032 $42,793,769 $14,289,911 $31,728,878

$6,261,567 $7,382,464 $6,751,154 $7,221,416 $7,272,951 $12,587,553 $8,142,613 $10,210,476 $8,767,482$960,700 $1,096,940 $1,242,670 $1,389,440 $1,643,460 $1,807,780 $2,013,830 $2,190,760 $2,375,360

$7,222,267 $8,479,404 $7,993,824 $8,610,856 $8,916,411 $14,395,333 $10,156,443 $12,401,236 $11,142,842$8,084,463 ($20,472,718) ($784,514) ($101,556,434) $7,104,785 ($21,973,016) $4,734,496 $37,891,910 $21,714,201

($113,019,234) ($133,491,952) ($134,276,466) ($235,832,900) ($228,728,115) ($250,701,131) ($245,966,635) ($208,074,726) ($186,360,525)

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$5,907,628 $6,185,467 $6,473,654 $6,772,539 $7,082,484 $7,403,863 $7,737,061 $8,082,477 $8,440,521

($2,428,194) ($2,855,563) ($3,302,843) ($3,770,775) ($4,260,121) ($4,771,672) ($5,306,244) ($5,864,682) ($6,447,858)$3,479,434 $3,329,904 $3,170,811 $3,001,764 $2,822,363 $2,632,191 $2,430,817 $2,217,795 $1,992,663

$11,563,897 ($17,142,814) $2,386,297 ($98,554,669) $9,927,148 ($19,340,825) $7,165,313 $40,109,704 $23,706,864($38,129,282) ($55,272,096) ($52,885,800) ($151,440,469) ($141,513,321) ($160,854,146) ($153,688,833) ($113,579,128) ($89,872,265)

Year


Page 2 of 5

















Factor


18 19 20 21 22 23 24 25 26

$12,116,894 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480 $12,485,480$14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839 $14,277,839

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$26,394,733 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319 $26,763,319$44,935,267 $46,929,643 $48,337,532 $49,787,658 $51,281,288 $52,819,726 $54,404,318 $56,036,447 $57,717,541

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$0 $0 $0 $0 $0 $0 $0 $0 $0

$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0$4,500,000 $4,500,000 $9,000,000 $0 $0 $0 $0 $0 $0

$225,000 $225,000 $450,000 $0 $0 $0 $0 $0 $0$180,000 $180,000 $360,000 $0 $0 $0 $0 $0 $0$900,000 $900,000 $1,800,000 $0 $0 $0 $0 $0 $0

$1,305,000 $1,305,000 $2,610,000 $0 $0 $0 $0 $0 $0

$24,103,556 $0 $0 $0 $0 $0 $0 $0 $0($4,820,711) $0 $0 $0 $0 $0 $0 $0 $0$19,282,845 $0 $0 $0 $0 $0 $0 $0 $0

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 $200,000$2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000 $2,900,000

$28,187,845 $8,905,000 $14,710,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000 $3,100,000$47,987,919 $15,614,971 $26,567,896 $5,766,913 $5,939,921 $6,118,118 $6,301,662 $6,490,712 $6,685,433

$9,147,556 $9,540,515 $10,500,364 $0 $0 $0 $0 $0 $0$2,567,890 $2,779,790 $0 $0 $0 $0 $0 $0 $0

$11,715,446 $12,320,305 $10,500,364 $0 $0 $0 $0 $0 $0$8,662,794 $43,634,976 $32,269,999 $44,020,745 $45,341,367 $46,701,608 $48,102,656 $49,545,736 $51,032,108

($177,697,731) ($134,062,755) ($101,792,755) ($57,772,011) ($12,430,644) $34,270,964 $82,373,620 $131,919,356 $182,951,464

$0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0$8,811,618 $9,196,206 $9,594,736 $0 $0 $0 $0 $0 $0

($7,056,674) ($7,692,062) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)$1,754,944 $1,504,143 $1,239,750 ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986) ($8,354,986)

$10,417,738 $45,139,119 $33,509,749 $35,665,759 $36,986,381 $38,346,622 $39,747,670 $41,190,750 $42,677,122($79,454,526) ($34,315,407) ($805,658) $34,860,101 $71,846,482 $110,193,104 $149,940,774 $191,131,525 $233,808,647

Year


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Factor


27 28 29 30

$12,485,480 $12,485,480 $12,485,480 $124,854,801$14,277,839 $14,277,839 $14,277,839 $142,778,393

$0 $0 $0 $0$0 $0 $0 $0

$26,763,319 $26,763,319 $26,763,319 $267,633,194$59,449,067 $61,232,539 $63,069,515 $649,616,008

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$200,000 $200,000 $200,000 $2,000,000$2,900,000 $2,900,000 $2,900,000 $29,000,000

$3,100,000 $3,100,000 $3,100,000 $31,000,000$6,885,996 $7,092,576 $7,305,353 $75,245,137

$0 $0 $0 $0$0 $0 $0 $0$0 $0 $0 $0

$52,563,071 $54,139,963 $55,764,162 $574,370,871$235,514,535 $289,654,499 $345,418,661 $919,789,532

$0 $0 $0 $0

$0 $0 $0 $0$0 $0 $0 $0

($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)($8,354,986) ($8,233,736) ($7,789,180) ($19,434,738)

$44,208,085 $45,906,228 $47,974,982 $554,936,133$278,016,732 $323,922,960 $371,897,942 $926,834,076


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Documents

Pier 70 Feasibility Analysis · Final Report Pier 70 Feasibility Analysis Prepared for: Port of San Francisco Prepared by: Economic & Planning Systems, Inc. ROMA Design Group