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We have reviewed the pro human ho and uses and financial projections)for the <br />approximately 125 units of rental housing proposed by Smart Company on Black H in <br />the Northwest Quadrant. <br />Background <br />The Stuart Company is well known and well respected in the Twin Cities market. Stuart <br />Nolan has 30 years experience in construction and long-term ownership of general <br />occupancy rental housing buildings. While other developers have specialized in <br />affordable housing programs or more complex fmancirg tmhniques, Stuart Company has <br />voided income or rent restrictions and has chosen a more classic approach to real ante <br />development. <br />Smart is proposing a $20,175,000 development, including land at a value of $500,000. <br />The sources for the project, as requested are <br />Developer Equity: $4,052,500 <br />Mortgage: 14,122,500 <br />City TIF: 2,000,000 <br />The typical method that we measure the appropriate level of public assistance is three- <br />fold: <br />1. Are costs in line with industry standards? <br />2. Are the assumptions for rents, vacancy, operating expenses too pessimistic, which <br />then makes the "need" appear higher than necessary? <br />3. Are the return on a{uity and developer fee reasormble? <br />FNen6Pmutlel� <br />Rosa Celle 151 MINDOm <br />Roeeaale,MN 551131106 <br />Phone'. 651E -8505 Fee 6516974555 <br />nnregerien-Mc n <br />�i EHLERS <br />LEADERS IN PUBLe FINAIWL <br />OTo: <br />Grant Femelim, City of New Brighton <br />2From: <br />Mark Ruff <br />W <br />Data: <br />Jub,21,2010 <br />S <br />Subject: <br />Proforma Review for Stuart Rental Housing Development <br />We have reviewed the pro human ho and uses and financial projections)for the <br />approximately 125 units of rental housing proposed by Smart Company on Black H in <br />the Northwest Quadrant. <br />Background <br />The Stuart Company is well known and well respected in the Twin Cities market. Stuart <br />Nolan has 30 years experience in construction and long-term ownership of general <br />occupancy rental housing buildings. While other developers have specialized in <br />affordable housing programs or more complex fmancirg tmhniques, Stuart Company has <br />voided income or rent restrictions and has chosen a more classic approach to real ante <br />development. <br />Smart is proposing a $20,175,000 development, including land at a value of $500,000. <br />The sources for the project, as requested are <br />Developer Equity: $4,052,500 <br />Mortgage: 14,122,500 <br />City TIF: 2,000,000 <br />The typical method that we measure the appropriate level of public assistance is three- <br />fold: <br />1. Are costs in line with industry standards? <br />2. Are the assumptions for rents, vacancy, operating expenses too pessimistic, which <br />then makes the "need" appear higher than necessary? <br />3. Are the return on a{uity and developer fee reasormble? <br />FNen6Pmutlel� <br />Rosa Celle 151 MINDOm <br />Roeeaale,MN 551131106 <br />Phone'. 651E -8505 Fee 6516974555 <br />nnregerien-Mc n <br />