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Financial Scenario The financial analysis of any most site/lmation slats wiW the ability ofthe marketplace to produce rents Mat can cover the development cat of Me complex. Common marker conditions in this markegionvi would suggest achievable mats of $1.31 par square foo. Weare currently MMe markelplace(and haw been for the last year and aha1Q on a product very similar in what is being proposed where the required ream) ram needs are $1.]0 per sgtmre foot. Ifwe are talking about a prieer Mat is coming online in 2013, $1.70 persquarefootispmbablyarealnumbernced�wsuppontheaeralwrtofthep jest. If Ne City contributes land in some fashion Mad will help reduce Me rent needed to produce an economically feasible transaction in this location and marnotdiev. Below we have laid out suario Mot identifies the profmma tort an development Mat would #art onsWetion in 201 L No matter wbet the abilityofthe minket m pay the rent is, this is a true cat of a project starting in 2011 and coming online are 2012, early 2013. What the challenge will be is how we ver Me financial gap ptadmN by this market sae's ability to pay a tae of only approximately $1.40 s.f. in Me year 2013. Pmiect Development Costs Land Coss OJ" Design Costs 1,291,000.00 Development Cas¢ 1,658,923.00 Financing Costs 647,227.10 Capitalized Interest 1,184,967.00 Concoction Com 24,400000.00 Markefing&Management 95,000.00 C ssfingeacy445883.00 Prijemad DendopmentCa6 30,363,000.00 We know, Mom ways of financing these types ofconsec[ions: 1) Tred'fioal Equity Deb[— Today equity would need to be about 40%, of Me mal cost The ream on equity over a 10 -year period of time world need to be 12-14%. The debt which would need to be 30 years would have stood somewhere mound 7%w today's maketplaw. Provided on the attached pages ruse two cash flow analysis. One is at the rent rale of $1.40 per square Mae and Me other at $1.70 persquare f LThe debt is 60pl, ofthe total developmentcwtetr/,mr30years. Basex! on Me two cash flow analysis munched you can see Mm the arum on equity would be below what the current equity market is requiring for traditional foaming, 2) HUD)- WHILD were brought into the equation for financing they would dimme some modifications to our typical product They are typically lagging M what they will permit to be built versus what Me market is asking to be built. Be Mat as it may, HUD is a viable option provided we could get an equity player to put up about 20Yo equity with a restricted return that HIT) requites. The Equity participant could either be MW pury investor or Me City through its EDA or BRA.