SR 09-23-2014 7B (2)City Council Report
City of
Santa Monied
To: Mayor and City Council
City Council Meeting: September 23, 2014
Agenda Item:'
7 —,31
From: Andy Agle, Director of Housing and Economic Development
Karen Ginsberg, Director of Community and Cultural Services
Subject: Affordable Housing Commercial Linkage Fee and Parks and Recreation
Impact Fee
Recommended Action
Staff recommends that the City Council introduce for first reading the attached ordinances
that create an affordable housing commercial linkage fee and a parks and recreation
impact fee to facilitate developer contributions to affordable housing and parks and
recreation and achieve Council objectives in those areas.
Executive Summary
Council has directed staff to further study both an affordable housing commercial
linkage fee and a parks and recreation impact fee to mitigate the impacts of
development on affordable housing and parks and recreation needs. Consultants
conducted nexus analyses to assess how new commercial development increases the
need for affordable housing and how new development increases the need for parks
and recreation facilities, and determined the maximum allowable fees that could be
charged to mitigate those impacts. A financial feasibility analysis was also conducted to
evaluate the financial feasibility implications of the two proposed fees on new
development. As a result of this analysis, staff recommends that Council introduce for
first reading two ordinances that would establish the following fees for new
development:
® an affordable housing commercial linkage fee ranging from $3.07 to $11.21
per square foot, depending on the type of commercial use, and
® a parks and recreation impact fee of $4,138 to $7,636 per residential unit and
$1.27 to $3.11 per square foot of nonresidential development, depending on
the land use.
The proposed impact fees are not projected to generate the level of revenues to
become primary funding sources for affordable housing or parks and recreation, but
would supplement other funding sources. Any development subject to these new fees
would not be subject to the existing Parks and Recreation Facilities Tax or the Housing
and Parks in -lieu fee currently in the Municipal Code.
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Background
On December 11 2012, Council provided direction to staff to study an affordable
housing commercial linkage fee and, on September 8, 2009, Council directed staff to
pursue a parks and recreation impact fee.
Affordable Housing Commercial Linkage Fee
The Municipal Code currently contains two mechanisms that support affordable housing
development. The Affordable Housing Production Program (AHPP) requires developers
of market -rate multi- family housing developments to contribute to affordable housing
production to help meet the City's affordable housing needs (SMMC section 9.56,
adopted July 21, 1998). The AHPP would not be changed by implementing the new fee,
which would only apply to commercial development.
The Housing and Parks in -lieu fee (SMMC Section 9.04.10.12, adopted April, 1986)
applies to general office development over 15,000 square feet (or 10,000 square foot
additions to existing development). The current fee is $5.15 per square foot for the first
15,000 square feet of applicable development and $11.45 per square foot above that.
However, the fee does not apply to creative office or other commercial development,
and due to its limited applicability, has generated very modest funding for affordable
housing. In fact, the Housing and Parks In -Lieu Fee has not generated any revenue at
all for housing or parks in four of the last five years. In the one revenue - generating year,
$123,785 in revenue was generated and was split between housing and parks. Any new
development subject to the new affordable housing commercial linkage fee would not
be subject to this existing fee.
On February 28 2012, Council held a study session to consider a variety of issues
related to affordable housing in Santa Monica. At the study session, Council indicated
its support for preparation of a nexus study to establish a linkage fee for commercial
development that would help address the demand it creates for new affordable housing.
The nexus study was designed to analyze the relationship between commercial
development, job creation, and the demand for affordable housing.
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On December 11 2012, Council directed staff to prepare an ordinance for Council
consideration which would establish an affordable housing linkage fee for commercial
development.
Parks and Recreation Impact Fee
The Municipal Code currently contains two fee mechanisms that support park and
recreation improvements. The first is the Parks and Recreation Facilities Tax (SMMC
Section 6.80, adopted July 1973). It establishes a Parks and Recreation Facilities Fund
to support the acquisition, improvement, and expansion of public park, playground, and
recreation facilities. The tax requires that each new dwelling unit be assessed a
one -time fixed fee of $200, but exempts units built for senior housing and persons with
disabilities. The $200 amount of the tax has never been adjusted since adoption of the
ordinance.
The second mechanism is the Housing and Parks in -lieu fee (SMMC section
9.04.10.12, adopted April, 1986) which, as previously described, applies to general
office development over 15,000 square feet or 10,000- square foot additions to existing
office development, and has generated extremely modest revenues in recent years.
Any new development subject to the new parks and recreation impact fee would not be
subject to either the Parks and Recreation Facilities Tax or the Housing and Parks
in -lieu fee.
On July 1, 1997, Council approved the Parks and Recreation Master Plan. The Open
Space Element which was prepared simultaneously was finalized and adopted on
July 24 2001. Since adoption, these documents have guided City investments in a
broad range of parks, open space, and recreation facilities.
The financing and implementation section of the Master Plan states that "Funding
sources should equitably share the burden among all park and recreation facility users.
Everyone who lives, works in, and visits the City of Santa Monica benefits from
amenities offered by the parks, beaches, and various recreational facilities.
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Therefore, funding used to implement the Master Plan should come from all users of
parks and recreation facilities to the extent possible ".
On May 12 2.009 and August 31 2009, both the Planning Commission and the
Recreation and Parks Commission recommended to Council that the fees for parks be
re- examined. On September 8 2009, Council subsequently directed staff to pursue the
creation of an open space linkage fee that would consider both residential and
commercial development.
Discussion
Proposed Affordable Housing Commercial Linkage Fee
Following Council's direction on February 28, 2012 to prepare a nexus study to
establish a commercial linkage fee to help mitigate the impacts on affordable housing,
the Rosenow Spevacek Group, Inc. (RSG), a consulting firm that has prepared similar
studies throughout California, completed a nexus study and fee analysis for
Santa Monica (Attachment A). The nexus study was designed to analyze the
relationship between commercial development, job creation by job type and salary
range, and the demand for affordable housing.
A linkage fee is designed to assess the financing gap associated with building
affordable housing to meet the needs of workers related to specific commercial uses.
On December 11 2012, Council directed staff to prepare an ordinance for Council
consideration which would establish an affordable housing linkage fee for commercial
development. The proposed affordable housing /commercial linkage fee would help
mitigate the impacts of commercial development on affordable housing. The fee would
be based on the need for affordable housing development that is generated when
various types of commercial developments are built (creative office space, hotel, retail
and entertainment, medical, industrial /light manufacturing, institutional, and hospitals).
The variety of jobs and varied degrees of compensation for workers in commercial use
developments generates housing demands for households at extremely low, very low,
low. and moderate incomes.
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In studying the potential linkage fee, RSG completed the following analysis:
1. Forecasted what percentage of households associated with workers in new
commercial developments would seek housing in Santa Monica (roughly
one - third).
2. Analyzed the employment density and wage levels associated with various
commercial uses to determine the number of lower- income employees per
square foot.
3. Estimated the development funding gap associated with the cost of building
affordable housing to serve the housing needs of the lower- income worker
households (the gap between the cost of developing an affordable housing unit
and the projected revenue the unit can generate).
4. Based on the three factors above, calculated a per- square -foot cost that could be
paid by new development to provide affordable housing gap financing to serve
the housing needs of new, lower- income worker households.
The full development cost to address the affordable housing needs of new worker
households varies widely based on the type of commercial development, the targeted
affordability of the housing, and affordable housing funding mechanisms. The RSG
study identified development costs averaging approximately $535 per square foot,
depending on these factors. Based on their analysis, RSG determined that the
maximum allowable fee that could be charged to cover the full cost of new affordable
housing development would range from $61.43 to $224.11 per square foot, depending
on the type of commercial use, as outlined in Table 5 -2 of the Nexus Study in
Attachment A and summarized in Table 1 below.
In setting housing linkage fees, most jurisdictions establish a financially feasible
percentage of the full cost to be captured from new development, given comprehensive
consideration of other development fees and their collective impact on the financial
feasibility of new development. Therefore, staff recommends that the fee be adopted at
five percent of the maximum allowable amount. Fee amounts would range from $3.07
to $11.21 per square foot, depending on the type of commercial use, as outlined in
Table 5 -2 of the Nexus Study in Attachment A and summarized in Table 1 below.
The proposed ordinance would provide a credit for existing commercial land uses that
are retained or rebuilt as commercial. The proposed fee would exempt places of
worship, City projects, day care centers, private K -12 schools, square footage used for
outdoor dining in the public right -of -way, and any commercial component of multi - family
rental housing developed by nonprofit housing providers that meet certain criteria as
defined in the proposed ordinance.
Table 1: Proposed Affordable Housing Commercial Linkage Fee
LAND USE
MAXIMUM FEE (per sf)
PROPOSED FEE (per sf)
Office
$224.11
$11.21
Hospital
$123.02
$6.15
Hotel
$61.43
$3.07
Retail
$195.07
$9.75
Industrial
$150.52
$7.53
Institutional
$204.55
$10.23
Creative Office
$191.74
$9.59
Medical Office
$137.78
$6.89
Proposed Parks and Recreation Impact Fee
Economic & Planning Systems, Inc., a consulting firm that has prepared similar studies
throughout California, completed a parks and recreation nexus study and fee analysis
for Santa Monica (Attachment B). The study meets the requirements of state law by
demonstrating the reasonable relationship between the proposed fees and the projected
impacts of development on parks and recreation needs.
Existing and forecasted (2010 to 2030) demographic and economic and visitor
information was used to define baseline conditions and help determine current service
standards. Population growth estimates were based on information provided in the
Land Use Circulation Element (LUCE) and its Environmental Impact Report (EIR).
Forecasts of future population and employment growth were used as the basis for
determining the associated growth in the parks service population (i.e. who will use
parks) and the corresponding future need for parks capital projects and facilities to be
funded in part by the fee.
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The study established the current replacement value for all City parks and recreation
facilities of $378.6 million and 131.4 acres as a baseline. It set a service standard for
use of the parks based upon population and acreage of 1.19 acres per 1,000 people.
By examining projected development and determining the associated growth in
residents, workers and hotel guests, the study concluded that the projected increase in
development would result in a 9.1 percent (10,123 resident equivalents) increase in
demand for parks and recreation facilities.
Using the factors described above, the study determined that the City would need to
increase park land by 12 acres to maintain the existing service standard. The study
estimated the costs of new park facilities, including land acquisition at $126 million to
meet the demand generated by the new users. In order to distribute the proposed fee in
a manner that acknowledges the predominant use of parks by residents, the study
developed resident equivalency levels with one non - resident employee having an
equivalent demand as 0.2 residents, and one overnight visitor having an equivalent
demand to that of 0.15 residents. Using these resident equivalency levels, the study
estimated the distribution of the new service population by land use as being 78 percent
residential and 22 percent non - residential (office, medical, retail, hotel, and institutional)
and set the maximum justifiable fees as shown in Table 2 below. The study also
examined comparable fees in other jurisdictions (Table 13, Attachment B) and
determined that if Santa Monica were to charge the maximum justifiable fee, the fees
would exceed all other jurisdictions that were surveyed.
Similar to housing linkage fees, in setting parks linkage fees, most jurisdictions establish
a financially feasible percentage of the full cost to be captured from new development
considering other development fees that are charged and the overall impact on the
financial feasibility of new development. With this in mind, staff recommends that the
parks and recreation impact fee be adopted at 25 percent of the maximum justifiable
fee, and that any new development subject to the new fee not be subject to either the
Parks and Recreation Facilities Tax or the Housing & Parks in -lieu fee. The proposed
ordinance includes a credit for existing units and square footage that is removed. It also
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proposes to exempt places of worship, City projects, day care centers, private K -12
schools, square footage used for outdoor dining in the public right -of -way, affordable
housing deed restricted to very low- income and low- income households, and
multi - family rental housing developed by nonprofit housing providers that meet certain
criteria as defined in the proposed ordinance.
Table 2: Proposed Parks and Recreation Impact Fee
LAND USE
MAXIMUM FEE
PROPOSED FEE
FEE BASIS
Residential
Single Family
$30,543
$7,636
per unit
Multi - Family (Studio /1 Bed)
$16,554
$4,138
per unit
Multi - Family (2 + bed)
$26,661
$6,665
per unit
Nonresidential
Office /Creative Office
$9.24
$2.31
per sq. Ft.
Medical Office /Hospital
$5.08
$1.27
per sq. Ft.
Retail
$5.98
$1.49
per sq. Ft.
Hotel
$12.45
$3.11
per sq. Ft.
Industrial
$5.18
$1.30
per sq. Ft.
Feasibility Analysis
HR &A Advisors, Inc. (HR &A) evaluated fourteen prototype development scenarios,
including the Transportation Impact Fee (TIF) and all other applicable City fees, as well
as the proposed affordable housing commercial linkage fee and the parks and
recreation development impact fee. The study produced findings regarding financial
feasibility implications of the two proposed fees for seven developments. The analysis
also considered adjustments to the base fees for versions of those same developments
that exceed baseline zoning standards to assist the Planning Commission, and
eventually the Council, in their consideration of the forthcoming Zoning Ordinance
update.
The prototypes that were studied initially included one all- commercial (retail /office)
prototype in Downtown and two prototypes on Wilshire Boulevard, including one
all- commercial (retail /office) and one mixed -use retail /residential (Attachment C).
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HR &A conducted further analysis in response to the Planning Commission's request at
its May 14, 2014 meeting to examine four additional mixed -use retail /residential
prototypes, all on smaller sites (15,000 sq. ft.) and with mostly smaller buildings (27,000
to 40,000 sq. ft.). These included three mixed -use residential /retail prototypes in the
Mixed -Use Boulevard Low (Santa Monica Boulevard and Pico) and General
Commercial (Lincoln south of 1 -10) designations, and one Downtown mixed -use
retail/residential prototype (see Attachment D).
The supplemental analysis also examined the impacts of designating 10 percent of the
housing as affordable to very low- income households (at 50 percent of area median
income) compared to the initial analysis which assumed five percent of the housing
would be designated as affordable to extremely low- income households (30 percent of
area median income). All scenarios studied in both sets of analyses included key
assumptions regarding a fee credit for existing square footage and land value derived
through a residual -land -value analysis. The square footage and unit counts were
derived in coordination with City planning staff and based on mixed -use developments
that have been recently proposed or constructed in Santa Monica.
HR &A's analysis measured the feasibility of the prototypes using the same three
thresholds that were used in the analysis for the Transportation Impact Fee:
® Up to a 20 percent change in residual land value after addition of the new fees;
® minimum 10 percent developer profit margin and up to 15 percent change in
profit margin after addition of the new fees; and
® minimum return on total development cost of 0.75 to 1.00 over the weighted
average cap rate for the prototype and a change in return on cost up to 0.02 with
the fees.
HR &A determined that the parks and recreation impact fee could be set at 25 percent of
the maximum justifiable fee amount without rendering any of the prototypes infeasible,
which corresponds with staff's recommendation. HR &A also determined that the
affordable housing linkage fee could be set at 4.5 percent of the maximum justifiable fee
amount, which is slightly lower than staff's recommendation of setting the fee at
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five percent of the maximum. Staff believes that applying five percent of the maximum
fee amount is warranted because the difference on per- square -foot basis is very small
and highly unlikely to cause a feasible project to become infeasible.
The recommendation also reflects the high priority the City places on affordable
housing.
Proposed Ordinances
Notable elements of the affordable housing commercial linkage fee ordinance
(Attachment E) include:
® Definitions and Applicability of Fee: Fee applies to developments that have a
commercial component and a gross new or additional floor area of 1,000 square
feet or more, including changes in use that increase the demand for affordable
housing. The ordinance exempts certain nonprofit or governmental uses from the
fee, exempts commercial portions of 100 percent affordable- housing
developments, and exempts re- occupancy of existing square footage if there is
no change in use. The ordinance defines various types of commercial land use.
® Fee Amounts: Establishes the affordable housing commercial linkage fee on a
per- square -foot basis as outlined in Table 1 above for various types of
commercial uses. Credit is given for existing commercial uses on the property
according to the per- square -foot fee value assigned to the commercial use that
existed on the site previously.
® Timing of fee amount and payment: The fee amount is calculated and must be
paid prior to issuance of a building permit.
Notable elements of the parks and recreation development impact fee ordinance
(Attachment F) include:
® Definitions and Applicability of Fee: Fee applies to developments that have a gross
new or additional floor area of 1,000 square feet or more, including changes in use
that increase demands on the parks and recreation system, as well as residential
development which adds dwelling units. The ordinance exempts certain nonprofit or
governmental uses from the fee and exempts re- occupancy of existing square
footage if there is no change in use. The ordinance defines various types of
commercial land use.
® Fee Amounts: Establishes the parks and recreation_ impact fee on a per- square -foot
basis as outlined in Table 2 for single - family and multi - family residential uses and
various types of commercial uses. Credit is given for existing uses on the property
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according to the per- square -foot fee value assigned to the type of use that existed
on the site previously.
® Timing of fee amount and payment: The fee amount is calculated and must be paid
prior to issuance of a building permit, except for residential uses where state law
requires payment before final inspection or the issuance of a certificate of
occupancy, whichever comes first.
Notable elements of both fee ordinances (Attachments E and F) include:
• Accounting: The ordinances establish separate reserve accounts for each fee, to be
used solely for the purposes of collecting and disbursing each fee.
• Use of Funds: The ordinances establish the parameters for the disbursement of
funds so that affordable housing commercial linkage fee revenues are used solely
for the production or preservation of affordable housing and parks and recreation
impact fee revenues are used solely for the acquisition and development of open
space, parkland, and recreation facilities to meet demand generated by new
development per the needs identified in each fee's Nexus Study.
• Automatic Annual Fee Adjustment: The fees adjust annually on July 1, beginning in
2015, by a percentage equal to the appropriate Engineering Construction Cost
Index.
• Fee Revision: The Council may periodically revise the amount of the fees or the
automatic adjustment by resolution.
• Implementation Schedule: The fees apply to all development applications meeting
the criteria for applicability that are submitted or determined complete .after the
effective date of the Ordinances.
® Refund of Payment: If a fee is paid but the corresponding project is not built, an
applicant may request a refund, which shall be granted if the fees have not yet been
expended.
Legal Considerations
The California Legislature passed Assembly Bill (AB) 1600 in 1987, the California
Mitigation Fee Act. As defined in AB 1600, a development impact fee is not a tax or
special assessment, but rather a fee that is charged by a local agency in connection
with approval of a development project for the purpose of defraying all or a portion of
the cost of public facilities related to the development project (Gov. Code § 66000(b) ).
The Parks & Recreation Development Impact Fee study and proposed fees comply with
the Mitigation Fee Act, including the amendment added by AB 3005 in 2008. If the fees
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are adopted, annual reports would be submitted to Council providing specific
information about the receipt and use of such fees as required by the Mitigation Fee
Act.
California courts have not required affordable housing in -lieu fees to meet the legal
requirements of the California Mitigation Fee Act. For example, in Home Builders Ass'n
v. City of Napa (2001) 90 Cal.AppAth 188,Action Apartment Ass'n v. City of Santa
Monica (2008) 166 Cal.AppAth 456, the appellate court identified the requirement to
provide affordable housing as traditional land use legislation. In Building Industry Assn
of Cent. California v. City of Patterson (2009) 171 Cal.AppAth 886, however, a different
court of appeal found that while the in lieu affordable housing fee under review in that
case was not subject to the Mitigation Fee Act, it was subject to the reasonable
relationship test set forth in San Remo Hotel L.P. v. City And County of San Francisco
(2002) 27 CalAth 643, 670 ( "San Remo "). Therefore, for the purposes of this linkage
fee, the Commercial Nexus Study & Linkage Fee analysis has been undertaken to
clearly demonstrate the relationship of the fee to its proposed expenditures.
Commission Action
On November 20, 2012, a presentation on the affordable housing commercial linkage
fee nexus study was made to the Housing Commission. The Housing Commission
unanimously adopted a motion supporting the creation of the fee. The Housing
Commission recommended that 18 to 20 percent of the maximum justifiable fee be
adopted. Staff recommends adopting the fee at five percent of the maximum justifiable
amount due to more recent information gleaned through the feasibility analysis outlined
above. Staff has kept the Housing Commission updated on the results of the feasibility
analysis and on staff's recommendation to Council. The Commission is supportive of
establishing the fee at the highest feasible level.
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On July 18, 2013 a presentation on the nexus study was made to the Recreation and
Parks Commission. The Recreation and Parks Commission adopted a motion in
support of staff's recommended fee levels.
On May 14 2014 and August 13 2014, presentations on proposed fees were made to
the Planning Commission in the context of the Commission's discussion of the
community benefits portion of the Zoning Ordinance update. At the May 14, 2014
meeting, the Planning Commission requested analysis of additional prototypes to study
some smaller prototypes, a wider variety of prototypes, and prototypes more
comparable to recently approved and pending projects. At the second meeting, when
presented with additional analysis indicating that fees are not anticipated to render any
potential developments infeasible, including the additional prototypes analyzed, the
Planning Commission recommended moving forward with the fee structures proposed
for the affordable housing commercial linkage fee and parks and recreation impact fee.
Recommendations regarding the community benefits system and tiered fee levels will
be forthcoming as part of the Zoning Ordinance update.
Alternatives
1. The City Council could modify the affordable housing commercial linkage fee or the
parks and recreation impact fee in order to charge different fees.
2. The City Council could choose to not adopt an affordable housing commercial
linkage fee nor a parks and recreation impact fee.
If Council pursues Alternative 1 by charging lower fees, fewer affordable housing
developments and parks and recreation facilities would be built and fewer of the impacts
of new development would be mitigated. The Council could choose to charge higher
fees, though not more than the maximum legally justifiable amount identified in the
nexus studies. If Council pursues Alternative 2, affordable housing and parks and
recreation impacts from new development would not be addressed, jeopardizing City
goals in these areas.
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Environmental Analysis
The proposed ordinance is not a project pursuant to CEQA Guideline section
15378(b)(4), which excludes from the definition of Project "the creation of government
funding mechanisms or other government fiscal activities, which do not involve any
commitment to any specific project which may result in a potentially significant physical
impact on the environment." Alternatively, the proposed ordinance is exempt from the
provisions of the California Environmental Quality Act (CEQA) pursuant to Section
15061(b)(3) in that it can been seen with certainty that the proposed ordinance does not
have the potential to significantly impact the environment, since the proposed ordinance
amendment is a fee that will be levied on projects that will be evaluated in compliance
with CEQA on their own merits.
Public Outreach
Both the affordable housing commercial linkage fee and the parks and recreation impact
fee have been discussed in concept for many years. Discussion of the fees has recently
been included in community outreach as part of the community benefits discussion
occurring in regards to the Zoning Ordinance update. In general, members of the
community have been supportive of the adoption of such fees. Additionally, staff has
communicated directly with members of the business community and Downtown Santa
Monica, Inc. regarding the proposed fees. Notice of the proposed fees was published in
the Santa Monica Daily Press on September 12, 2014 and September, 18, 2014.
Copies of the nexus studies and financial feasibility analysis were made available at that
time at the City Clerk's Office and on the City's web site.
Next Steps
If adopted on second reading, the ordinances would go into effect 60 days thereafter,
giving staff sufficient time to make administrative changes necessary to implement the
fees.
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Financial Impacts & Budget Actions
There is no immediate fiscal impact or budget action necessary as a result of the
recommended action. If approved, collection of the fees would commence in
FY 2014 -15. Revenues would be received at accounts 04264.408690 (AFFORDABLE
HOUSING COMMERCIAL FEES) and 04501.408710 (PARKS AND REC IMPACT
FEES). Revenues will depend on the volume and nature of new development, and
revenue projections would be included in future year budgets as warranted. Funding for
park and recreation projects and for affordable housing development loans would be
included in future -year budgets.
Prepared by: Sarah Johnson, Principal Administrative Analyst
Melissa Spagnuolo, Senior Administrative Analyst
Approved:
Forwarded to Council:
l
c
Andy Agle, Directo Rod Gould
Housing and Economic Development City Manager
Karen Ginsberg,
Community and
Attachments:
A: Commercial (Non - Residential) Nexus Study and Linkage Fee Analysis
B. Parks and Recreation Development Impact Fee Study
C. HR &A Memo Estimating Financial Feasibility of Tier 2 vs. Tier 1 Development Fees
D. HR &A Memo — Proposed New Development Fees Analysis Update
E. Proposed Affordable Housing Commercial Linkage Fee Ordinance
F. Proposed Parks and Recreation Impact Fee Ordinance
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Attachment A
Commercial
(Non-Residential)
Nexus Study &
July 25, 2013
ri �}. e
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
TABLE OF CONTENTS
INTRODUCTION.................................................................................................. ..............................1
Background...................................................................................................... ..............................2
AffordabilityLevels ............................................................................................ ..............................3
Summaryof Findings ........................................................................................ ..............................4
ReportOrganization .......................................................................................... ..............................6
DataSources .................................................................................................... ..............................6
SECTION 1: NEXUS CONCEPT AND ASSUMPTIONS .......................................... ..............................7
LegalBackground ............................................................................................. ..............................7
Non - Residential Nexus Study Methodology .......................:................................ ..............................8
The Relationship Between Job Growth and Population Growth ........................... .............................11
The Relationship Between Non - Residential Development and Job Growth .......... .............................11
Housing Needs of New Population vs. Existing Housing Need ............................ .............................12
SubstitutionFactor ........................................................................................... .............................12
EmploymentMultipliers .................................................................................... .............................12
Discount for Changing Industries ...................................................................... .............................13
SECTION 2: LOCAL ECONOMIC INPUTS AND ADJUSTMENTS ......................... .............................14
BuildingPrototypes .......................................................................................... .............................14
EmployeeDensity ............................................................................................ .............................14
Occupational Distribution by Building Prototype ................................................. .............................16
Employee Compensation .................................................................................. .............................18
Employment Patterns (Industry Change Factor) ................................................. .............................18
Unemployment................................................................................................ .............................19
CommutePatterns ........................................................................................... .............................20
SECTION 3: MICRO ECONOMIC JOBS HOUSING ANALYSIS ............................ .............................21
Approach......................................................................................................... .............................21
Step 1: Establish Building Prototypes ......................................................... .............................21
Step 2: Estimate Total New Employees ...................................................... .............................21
Step 3: Adjustments for Market Conditions .................................................. .............................22
Step 4: Adjustment from Employees to Employee Households ..................... .............................23
Step 5: Occupational Distribution of Employees .......................................... .............................23
Step 6: Estimate Distribution of Employee Wages ....................................... .............................26
Step 7: Estimate Household Income Category Distribution ........................... .............................26
Step 8: Estimate New Households that Meet Income Criteria ....................... .............................27
Step 9: Calculate Worker Households Income Categories and Adjust for Commute Patterns ......27
Summary.. .................................................................................................................................... 2
28
R S G
3
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANAL YSIS
City of Santa Monica
SECTION 4: AFFORDABLE HOUSING COSTS ......................
Introduction......................................... ...............................
Affordable Housing Cost ....................... ...............................
Rental Apartments Valuation ............... ...............................
Affordable Housing Development Funding Gap .....................
SECTION 5: FEE ANALYSIS AND RECOMMENDATIONS......
Approach and Methodology .................. ...............................
Rental Apartment Projects .................... ...............................
Mitigated Development Funding Gap ..... ...............................
Impact Linkage Fee Calculation ............ ...............................
Impact Linkage Fee Consideration ........ ...............................
ATTACHMENTS ..................................... ...............................
Attachment 1: Occupational Categories and Wage Data........
Attachment 2: Affordable Housing Product Type Pro Formas.
Attachment 3: Linkage Fee Alternatives . ...............................
® PSG
4
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
INTRODUCTION
This Commercial (Non - Residential) Nexus Study ( "Nexus Study ") and Linkage Fee Analysis (collectively
referred to as the "Report") has been prepared by the Rosenow Spevacek Group ( "RSG ") for the City of
Santa Monica ( "City') to analyze the affordable housing needs created by the development of non-
residential buildings in the City.
The primary goal of this Nexus Study is to demonstrate the "reasonable relationship" between the
purpose of the affordable housing fee, the fee amount, the revenue generated, and the impacts of
commercial development that the proposed use of that revenue is intended to address. I
The Nexus Study identifies the linkages between new non - residential land uses, the net number of new
employees and employee households generated by businesses occupying these land use buildings, and
the need for affordable housing units for these new employees. The Linkage Fee Analysis quantifies the
cost mitigation associated with developing affordable housing units based on the identified need resulting
from employees generated by new commercial development.
Factors examined by the Nexus Study include the variety of jobs and varied degrees of compensation for
workers in new non - residential buildings which in turn creates a demand for housing at all affordability
levels. The Nexus Study quantifies the housing needs of new employees by income category within a
variety of land use categories. The Nexus Study examines eight types of non - residential land uses, as
identified in the City's 2010 Land Use and Circulation Element (LUCE) that are anticipated to be built over
the next twenty years; they include office, hospital, hotel, retail, industrial, institutional, creative, and
medical office. Each land use type results in a different mix of employment and income affordability
levels due to the density of jobs, the type of jobs, and the corresponding employee compensation. The
Nexus Study identifies the net number of new employee households living in the City, by affordability
level, generated by the development of each of the land use types cited above. The resulting number of
net new households indicates the number of housing units needed by income category. The affordable
housing impact linkage fee is then ascertained based upon the cost to mitigate the affordable housing
need generated by such development based on the development funding gaps associated with producing
affordable housing units for each income category.
This Nexus Study and Linkage Fee Analysis has been prepared to satisfy the requirements of reasonable
relationship test set forth in San Remo, as well as to inform the decision makers as to the impacts
associated with new non - residential development.
I California courts have not required affordable housing in -lieu fees to meet the legal requirements of the
California Mitigation Fee Act (AB 1600, 1987, Gov. Code § 66000 et seq.). For example, in Action
Apartment Assn v. City of Santa Monica (2008) 166 Cal.AppAth 456, the appellate court identified the
requirement to provide affordable housing as traditional land use legislation. In Building Industry Assn of
Cent. California v. City of Patterson (2009) 171 Cal.App.4th 886, however, a different court of appeal
found that while the in lieu affordable housing fee under review in that case was not subject to the
Mitigation Fee Act, it was subject to the reasonable relationship test set forth in San Remo Hotel L.P. v.
City And County of San Francisco (2002) 27 CalAth 643, 670 ("San Remo'). Therefore, for the purposes
of this linkage fee, this analysis has been provided to clearly demonstrate the relationship of the fee to its
proposed expenditures.
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Background
The City Santa Monica adopted an Affordable Housing Production Program (AHPP) Ordinance to assist
in the production of affordable housing units in the community. The AHPP is applicable to new market
rate multifamily residential units constructed in the City. For program consistency purposes, the
requirements and provisions under the AHPP, as amended June 11, 2013, are used in determining the
income groups incorporated in this Study for purposes of identifying new employment segmented by
income category, calculating affordable housing costs and the corresponding supportable linkage fee
amounts. The following is a summary of the requirements and provisions set forth in the AHPP
Ordinance.
The AHPP is applicable Citywide to each new multifamily project involving the construction of two
or more market rate units. Market rate projects include but are not limited to apartments,
condominiums, townhouses or the multifamily residential component of a mixed use project.
Projects exempt from the AHPP include designated landmark buildings or contributing structures
to an adopted Historic District retained or preserved on -site as part of a multifamily project,
multifamily rental housing projects to be developed by a nonprofit housing provider receiving
financial assistance through a City housing trust fund program, non - residential projects, and
projects for which a development application was determined complete prior to May 25, 2006.
Multifamily ownership projects of four or more units may satisfy the affordable housing
requirement by one of the following options:
a. Providing the affordable units on -site; or
b. Providing the affordable units off -site.
In addition to the options established above, all other multifamily projects may also choose one of
the following options:
a. Paying an affordable housing fee; or
b. Acquiring land for affordable housing.
For ownership projects of not more than fifteen units in multifamily residential districts at least: 1)
twenty percent (20 %) of the total units must be designated as ownership units for moderate -
income households; or 2) twenty percent (20 %) of the total units must be designated as rental
units for low- income households.
® For ownership projects of sixteen or more units in multifamily residential districts at least: 1)
twenty -five percent (25 %) of the total units must be designated for moderate - income households
as ownership units; or 2) twenty -five percent (25 %) of the total units must be designated for low -
income households as rental units.
For all other multifamily projects that elect to develop the affordable units on -site at least: 1) five
percent (5 %) of the total units for extremely low- income households; 2) ten percent (10 %) of the
total units for very low- income households; 3) twenty percent (20 %) for low- income households;
or 4) one hundred percent (100 %) for the total units for moderate - income households.
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® The AHPP requires the deposit of any payment made pursuant to the AHPP to an affordable
housing reserve account separate from the General Fund to be used only for the development of
very low- and low- income housing, administrative costs related to the production of housing, and
monitoring and evaluation of the Affordable Housing Production Program.
Affordability Levels
The City's Land Use and Circulation Element of the General Plan provides data regarding the need for
affordable housing in the City. The City's affordable housing needs are largely defined by the Regional
Housing Needs Assessment (RHNA) promulgated by the Southern California Association of Governments
(SCAG), which allocates the regional housing demand, by income category, to local jurisdictions as
targets to be addressed in their respective Housing Elements. Santa Monica's fifth cycle RHNA for the
period January 2014 through October 2021 reflects a total need for 1,674 new residential housing units,
which include an allocation of 25.5% for very low income households, 16.1% for low income households,
17.0% for moderate income households, and 41.5% for above moderate income households. The
maximum income level for lower and moderate income households, as defined in the California Health
and Safety Code and as promulgated by the Housing and Community Development Department ( "HCD ")
is 120% of the area median income CAW).
The LUCE showed that 60% of the households in the City make less then 120% AMI, and identified that
72% of the City's households are renters, which is the highest proportion of renter households among all
Los Angeles County cities. Moreover, the LUCE indicates that 35% of renter households of the very low -
and low- income households within the City are overpaying for housing z. The federal Housing and Urban
Development Department's ( "HUD ") threshold for overpayment is when households spend more than
30% of their gross monthly income on rent or mortgage payments. Overpayment is a critical issue,
because it leaves households with insufficient funds for other necessities, such as food, health care,
clothing, and utilities. Extremely low -, very low- and low- income households are not the only households
in the City who are affected by the City's high housing costs.
The City's affordable housing needs can be demonstrated through review of the following information.
The 2012 U.S. Census American Community Survey data placed the median household income in Santa
Monica at $68,842 ($5,737 per month). Based on Apartments.com and Craig's List data for August 2012
of new and existing apartments in the City, the median monthly rent for a one - bedroom apartment is
$2,339, increasing to $3,546 for a two - bedroom apartment. This data indicates that a household would
need to make approximately $7,796 per month to afford a median priced one - bedroom apartment within
the City, or $11,820 per month to afford a median priced two - bedroom apartment. These rents represent
approximately 136% and 206% of the $68,842 ($5,737 per month) median income respectively.
According to the LA Times /DataQuick data, in August 2012 the median price for ownership
condominiums in the City ranged between $470,000 and $775,000, with an average of $668,200. Based
upon these prices, the estimated monthly housing cost, including principal and interest (based upon 80
percent financing loan), taxes, insurance, and HOA fees would be about $4,435. Therefore, in order to
2 A defined by State HCD,extremely low -and very low- income households generallyearn not more than 30% and
50 %of area median income respectively; low- income households earn notmorethan 160 %.ofthe very low- income
limits forhigh costareas such as Los Angeles County, where the limit reflects about 105% of the area median
income; and moderate - income householdsearn notmore than 120 %of the area median income.
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afford a median priced condominium in the City, the wage earner in a single earner household would
need to make approximately $14,785 per month to conform to the 30% housing cost target.
The minimum wage in the State of California is $8 per hour (or $16,640 per year), which is less than 18%
of what is needed to rent a one - bedroom apartment in the City. This means that a full -time dual income
household, where both workers make minimum wage, would not be able to afford to rent a median priced
apartment within the City. It is expected that a portion of the new workers including lower income
households working at low -wage jobs in new non - residential land uses developed in the City would seek
housing within the City. However, due to a short supply of affordable units, many households would
either be forced to live outside of the City (in which they work), or spend a large portion of their income on
housing, or live in substandard conditions.
The California Health and Safety Code (H &SC) provides a general definition of low and moderate income
limits and identifies the calculation of the respective affordable housing costs and rents for each income
category. Pursuant to the Health and Safety Code, HCD establishes and publishes annually the
Qualifying Income Limits by income category adjusted for household size, The income limits and
affordable housing cost criteria under the Health and Safety Code are widely used and generally
applicable for various affordable housing programs implemented in local jurisdictions including those by
redevelopment agencies and projects using redevelopment housing set -aside funds, those by housing
authorities, and those under density bonus programs. The City's AHPP Ordinance, as amended, adopted
the same criteria as identified under the Health and Safety Code. Accordingly, this Nexus Study uses the
H &SC and AHPP income limits and rents criteria. The income category limits are generally defined as
follows:
Extremely Low - Income households earning 30% or less of the area median income;
Very Low - Income households earning 50% or less of the area median income;
Low - Income households earning 80% or less of the area median income; and
Moderate - Income households earning 120% or less of the area median income.
As footnoted above, however, Los Angeles County is identified as a high housing cost area by HCD and
HUD, which results in the household income limits for the lower income categories exceeding the
percentage of area median incomes identified above.
The Nexus Study will identify the affordable housing need, by income category, generated by the
development of new non - residential buildings in the City, including office, hospital, hotel, retail, industrial,
institutional, creative, and medical office uses. Such buildings will house new jobs, many of which will be
low paying, thus generating the need for housing affordable for those wage earner households.
Summary of Findings
The following provides a summary of the Nexus Study findings, which are detailed in Sections 1 through
3, and the Linkage Fee Analysis, as detailed in Sections 4 and 5 of this Report. The City's LUCE
estimates that approximately 3.49 million square feet of non - residential development will occur during the
twenty year period from 2010 to 2030. Based on the City's LUCE data analysis derived from the Los
Angeles Unified School District 2008 School Fee Justification Study, which is used to identify employee
density, it is estimated that new non - residential development in the City will create a total of about 6,918
net new worker jobs after adjustment for market factors. Further, based on a combination of data from the
2002 Economic Census and the 2012 American Community Survey, it is projected that the estimated
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COMMERCIAL (NEXUS STUDY AND LINKAGE IEE ANALYSIS
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employment growth will result in about 6,122 new worker households, of which its is conservatively
estimated that approximately 2,082 households (34 %) may live in the City.
An analysis of data for the Los Angeles County MSD provided in the OES Occupational Employment and
Wage Estimates, the BLS Occupation and Wage Survey, and from the California Economic Development
Department identifies that a substantial portion (69.7 %) of the new worker households generated by the
development of various new non - residential land uses would require housing affordable at the extremely
low -, very low -, low -, and moderate - income levels (refer to Table 3 -9). The following is a summary of the
future affordable housing need for 1,451 units in the City generated by non - residential development,
which is broken down as follows:
216 (15.0 %) Extremely Low - Income Households
687 (47.3 %) Very Low - Income Households
424 ( 29.2 %) Low - Income Households
124 (8.5 %) Moderate Income Households
This Report also provides an analysis of the housing impact linkage fee associated with the affordable
housing need generated by the non - residential development in the City. The linkage fee analysis (refer to
Sections 4 and 5) translates the affordable housing need generated by each of the land use building
prototypes (refer to Sections 1 through 3). This was done by adjusting the affordable housing need into
square feet and multiplying that need by the cost to produce housing affordable in each of the income
categories. Table 1 -1 below summarizes the maximum supportable impact fee on a square foot basis for
each of the building prototypes, as well as a range of recommended reduced impact fees for the City's
consideration. The recommended reduced fee levels are meant to avoid adverse economic impacts on
the developers of new non - residential projects in the City. As discussed in Section 5 of the Linkage
Analysis, the final impact linkage fee is recommended at between 5% and 25% of the maximum
supportable fee established by the Non - Residential Nexus Study for each of the identified land uses.
Table 1 -1, shown below, demonstrates the range of impact fees per land use.
Per Square Foot Non - Residential Impact Fees' Table 1 -1
Santa Monica Linkage Fee Analysis
Source: Table 5 -2
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Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Full impact Fee
$224.11
$123.02
$61.43
$195.07
$150.52
$204.55
$191.74
$137.78
5%
$11.21
$6.15
$3.07
$9.75
$7.53
$10.23
$9.59
$6.89
10%
$22.41
$12.30
$6.14
$19.51
$15.05
$20.45
$19.17
$13.78
Impact Fee Options
15%
$33.62
$18.45
$9.21
$29.26
$22.58
$30.68
$28.76-
$20.67
(per Square Foot)
20%
'$44.82
$24.60
$12.29
$39.01
$30.10
$40.91
$38.35
$27.56
25%
$56.03
$30.76
$15.36
$48.77
$37.63
$51.14
$47.93
$34.45
Source: Table 5 -2
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Report Organization
This Report contains five sections, as follows:
Section 1 — Nexus Concept and Assumptions: This section presents a summary of the linkage
concept and some of the key issues surrounding nexus analyses for jobs and housing.
Section 2 — Local Economic Inputs and Adjustments: This section provides an overview of the
economic conditions in and around the City, including those key to the Non - Residential Nexus
Study.
Section 3 — Micro Economic Jobs Housing Analysis: This section describes the analysis which
was performed, linking jobs and housing relationships to the land uses and building prototypes
examined.
Section 4 — Affordable Housing Costs: This section examines the cost to produce affordable
housing units in the City. This analysis was used to associate a cost with the need for affordable
units, as identified in Section 3.
Section 5 — Fee Analysis and Recommendations: This section combines the information from the
analyses in Sections 3 and 4 to formulate the maximum non - residential affordable housing impact
fees for the City. This section also adjusts and provides recommendations regarding the final fee
levels, in order to provide reduced economic impact to developers of non - residential property in
the City.
Data Sources
RSG has prepared this Report using the most current and verifiable data available. Sources used include
the US Census ('Census'), California Economic Development Department ( "CEDD "), Department of
Labor - Bureau of Labor Statistics ( "BLS "), California Department of Housing and Community
Development, the Southern California Association of Governments ( "SCAG "), and First American Title
MetroScan Information Service. The Census, CEDD, and BLS data and materials are widely used for
demographic and econometric analyses including nexus studies prepared for a large number of
jurisdictions in California, In addition, at the direction of City staff, employee density factors used in the
LUCE were used as a basis for determining the estimated total new jobs resulting from the development
of each land use type.
RSG believes that these data sources are deemed to be reliable and believed to provide accurate and
relevant information for this analysis. Nonetheless, RSG cannot guarantee their accuracy and assumes
no liability for information from these sources or others.
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SECTION 1: NEXUS CONCEPT AND ASSUMPTIONS
Section 1 outlines the nexus concept and the assumptions used in the analysis. The analysis is centered
on the linkages between population growth, non - residential development, employment, employee wages,
and the demand for housing. The analysis connects the development of certain new non - residential land
use building types, employees who will work in those building types,, and the generated need for
affordable housing. The model utilizes data from a number of sources including the BLS, CEDD, Census
including the 2012 U.S. Census American Community Survey (ACS), HCD, and SCAG. In addition,
conservative assumptions were used in order to not overstate the affordable housing need generated.
Legal Background
The first inclusionary housing ordinances were adopted in the early 1970's. In analyzing initial challenges
to them, courts characterized affordable housing and in lieu fee ordinances as traditional land use and
zoning regulation, and not as exactions or impacts fees.
The traditional land use ordinance position has been most clearly adopted by the New Jersey Supreme
Court in Southern Burlington County NAACP v. Township of Mount Laurel, (N.J. 1983) 456 A.2d 390. In
1990, in Holmdel Builders Ass'n v. Township of Holmdel, (N.J. 1990) 583 A.2d 277, the New Jersey
Supreme Court revisited the issue while reviewing the constitutionality of affordable housing fees required
by several New Jersey cities. The court explained that "inclusionary- zoning devices," including
inclusionary in -lieu fees, are land use ordinances that bear a "real and substantial relationship to the
regulation of land" because they are specifically designed to help create affordable housing and will
therefore affect "the nature and extent of the uses of land and of buildings... " Id. at 286 -87. The court
held that inclusionary in -lieu fees are not exactions similar to impact fees, because the affordable housing
requirements are not based on the impact of a project, but rather on the "the relationship that . . .
development has on both the need for lower- income residential development and on the opportunity and
capacity of municipalities to meet that need ..." Id. at 288.
In Home Builders Ass'n v. City of Napa, 90 Cal.App.4th 188 (2001), the first published California case
regarding inclusionary zoning, the City of Napa argued that its inclusionary ordinance was a land use
ordinance that merely regulated the use of a small part of a development, and that inclusionary in -lieu
fees were not impact fees because the underlying inclusionary requirement was not a monetary exaction,
but rather a land use control, and fees were paid only at the election of the developer. In rejecting
plaintiffs claims that the City's ordinance was an invalid exaction under Nollan v. California Coastal
Commission, 483 U.S. 825 (1987) and Dolan v. City of Tigard, 512 U.S. 374 (1994), the Court of Appeals
treated Napa's inclusionary zoning ordinance as "economic legislation that is generally applicable to all
development in City." Id. at 197. In Action Apartment Ass'n v. City of Santa Monica, 166 Cal.AppAth 456
(2008), the Court similarly considered the City's inclusionary housing ordinance a traditional land use or
zoning legislation and not an exaction.
No California court has treated a generally applicable inclusionary housing ordinance as imposing an
impermissible per se exaction or required in -lieu affordable housing fees to meet the legal requirements
of the California Mitigation Fee Act. In Building Industry Ass'n of Cent. California v. City of Patterson
( "Patterson ") (2009) 171 Cal.App.4th 886, however, the Court of Appeal applied the "reasonable
relationship" test to an inclusionary affordable housing in -lieu fee, assuming that it was a generally
applicable impact fee and without ever considering (at least in the published opinion) whether the
underlying requirement was an exaction or a land use requirement. Nonetheless, the language in
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Patterson characterizes the in -lieu fee under review as not substantively different from the in -lieu housing
fee reviewed in San Remo, and subject to the requirement that there be a reasonable relationship
between the amount of the fee and the "deleterious public impact of the development." 27 CalAth 643,
670 -71. This study has been provided to satisfy the requirements of San Remo.
Non - Residential Nexus Study Methodology
The following discussion provides an overview of the general concepts and methodology used in the Non -
Residential Nexus Study. The analysis links the construction of new non - residential land uses to a net
increase of new workers in the City. These new workers will need housing within a reasonable distance
of their jobs, some of which will be in the City. The compensation levels paid to some of these workers
will result in them needing housing which is affordable at the extremely low -, very low -, low -, or moderate -
income levels.
Briefly summarized in Figure 1 -1 below are the basic analytical steps utilized to conduct the Nexus Study.
A more detailed description of the methodology associated with each step is provided in Section 3, the
Micro Economic Jobs Housing Analysis.
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Nexus Analysis Process Figure 1 -1
Step 1: Establish Building Prototypes
The analysis is conducted based on inclMdual non - residential land use building types for the land
uses identified in the City's LUCE. For analysis purposes, prototypical 100,000 square feet of
building area for each of the land use types identified in the LUCE was analyzed. The analysis of
indiNdual building types is based on general conditions within the City, as identified by City staff.
Step 2: Estimate Total New Employees
Estimate the number of new permanent direct employees which will be generated by the
construction of the eight new non - residential land use building types. Employee density factors
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COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
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were used to estimate the number of employees in each land use type. The employee density
factors used in the Nexus Study are detailed in Section 2 of this Report.
Step 3: Adjustments for Market Conditions
This step incorporates into the analysis any changes in the local economy (including increases in
unemployment) and the type of jobs and industries which make up the region. Specifically,
declines and /or other shifts in the local economy can affect how new non - residential space is
occupied. The result of these market condition adjustments is a reduction in the number of
employees generated from the development of new non - residential land uses.
Step 4: Adjustment from Employees to Employee Households
This step adjusts the number of employees /workers to account for households in which there is
more than one wage earner. In order to adjust for this consideration, a ratio of 1.13 workers per
worker households is used in this analysis based on City Census data.
Step 5: Occupational Distribution of Employees
Job types are then associated with the land use prototypes to produce a distribution of employees
by occupation. To do so, NAICS industry sectors were correlated to jobs depending on the
likelihood that the industries would be housed in each building type. Next, the NAICS industry
sectors are linked to OES occupation categories. This step is important because it links building
types with occupational categories. Occupational categories are then linked to wage data
addressed in the next step.
Step 6: Estimate Distribution of Employee Wages
Occupational data generated in Step 5, is combined with wage and salary information from the
County (based upon NAICS and CEDD data) to estimate the distribution of employee wages.
Employee wages were then converted to household wages using the employees per household
ratio used in Step 4.
Step 7: Estimate Household Income Category Distribution
The results from Steps 5 and 6 allow the estimated number of employee households from the
previous step to be categorized into household size (number of persons) by income, based on
City Census data. This step is important because it allows the households created to have
income and size associated with them.
Step 8: Estimate the Households that Meet Income Criteria
The previous step distributed households into size and income categories. The households are
then allocated to specific income categories (extremely low -, very low -, low -, moderate- and
above moderate - income households) per the income limits identified under the H &SC and the
AHPP. Once the households have been placed into their respective income categories, it is
possible to show the number of housing units required to meet the needs of the extremely low -,
very low -, low -, and moderate - income households generated by the construction of each of the
building prototypes.
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Step 9: Adjust for Commute Patterns
This step adjusts the total number of households by the percentage of employees /workers who
currently live in the City. This step reduced the number of new households needing housing by
approximately 66 %. This adjustment is necessary since not all of the new employees generated
by new non - residential buildings will live in the City. The adjustment reflects a combination of
data from the 2012 Economic Census and the 2012 American Communities Survey data, which
indicates that approximately 34% of the workers in Santa Monica also live in the City. The 34%
factor reflects a reasonable and conservative estimate based on empirical data, while it may be a
greater percentage subject to net increases in availability of housing units in the City.
Step 10: Calculate Total Affordable Housing Needs Created by Non - Residential Buildings
This final step adjusts the worker household per 100,000 square feet of building to calculate the
total new worker households by income category that would live in the City pursuant to the LUCE
land use development projections. The resulting total new worker households living in the City
serve to 'reflect the total number of affordable housing units, by income category which is
attributable to the total estimated non- residential land use types, if the City's land use projections
are fulfilled.
The Relationship Between Job Growth and Population Growth
The linkage analysis assesses the growth in extremely low -, very low -, low -, and moderate - income
households within the City generated by new development, and subsequent lack of affordable housing
units available to these new households. A major contributing factor for population growth in most
communities is job growth. Households would not arrive or stay in the community if jobs were not
available in or near the area to support them. This trend is typically long term since economic cycles and
other factors including the availability of housing units can result in population growth without jobs. For
these reasons, this analysis is specifically designed to address the long term linkage between the
development of new non - residential land uses, job growth, and the resulting need for housing affordable
to very low -, low -, and moderate - income households.
The Relationship Between Non - Residential Development and Job Growth
If population growth is in part driven by job growth, then what is the source of employment growth? Many
factors contribute to the growth in employment in different areas. These factors tend to be interrelated
and associated with outside forces. A major contributing factor is the development of new non - residential
land uses, which will house jobs. The rationale behind a. non - residential nexus study is that the
construction of these new buildings is largely, but not solely, responsible for growth. Nonetheless, in the
City of Santa Monica, new non - residential construction is an important factor contributing to population
growth, while it is also an essential condition that precedes growth.
As mentioned, new construction itself encourages population growth. This relationship was most recently
seen during the ten year period 1995 through 2005, when construction activities in California were one of
the main drivers of a thriving economy. In many regions including Los Angeles County, the development
industry frequently serves as a proactive force inducing growth to occur, especially with projects of a
speculative nature.
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Lastly, new non - residential construction in particular encourages job growth because it precedes
population growth. Job growth would not occur in our modern service economies without buildings to
house new workers. In fact, the inability to develop new workspace will often constrain or even halt job
growth in an area.
Housing Needs of New Population vs. Existing Housing Need
The Housing Element for the City, the City Inclusionary Housing Annual Report, and other materials
indicate that while the housing needs of the existing lower- income households in the City are generally
being met in accordance with the City's RHNA distribution, future activities to ensure affordable housing
may be hampered by diminished funding availability. Moreover, many existing households, especially
those at the lowest income levels, overpay for housing (payment of more than 30% of income for rent, as
set forth in federal and state guidelines), live in overcrowded conditions, or cannot live in the City and
must live and commute from less expensive locations.
This Nexus Study does not address the housing needs of the existing population or the needs resulting
from new residential construction, which was addressed in the 2005 Update Nexus Between New Market
Rate Multifamily Developments in the City of Santa Monica and the Need for Affordable Housing. While
new employment associated with residential development may result in some minor overlap with the new
jobs resulting from new non - residential development, for a number of reasons, including but not limited to,
building vacancy /under utilization, unemployment, under employment and part time employment factors,
it is deemed to be very minor and would not generally induce a significant level of new commercial or
other non - residential development. Accordingly, this Nexus Study focuses solely on documenting and
quantifying the housing needs of net new households generated by new non - residential buildings.
Substitution Factor
Any new building in the City may be occupied either partially or entirely by workers or firms relocating
from elsewhere. When a business relocates to a new building, there is a space in an existing building
that is vacated. In turn, the vacated building will likely be filled by a combination of newcomers in the City
or existing workers. Somewhere in this cycle, new jobs will be added to the region. The net effect is that
new buildings accommodate new employees, although not necessarily inside of the new buildings
themselves.
Employment Multipliers
The Non - Residential Nexus Study does not address the concept of multipliers. Multipliers refer to the
concept that the income generated by certain types of jobs recycles through the economy, resulting in
additional jobs. This Nexus Study omits such multiplier effects, because they are largely accounted for in
the City's Residential Nexus Study, which measures the impact of new household spending on the need
for affordable housing units. The assumption in the Residential Nexus Study is that the associated new
jobs may be largely employed within existing businesses and buildings (or assist in generating the need
for new buildings, as discussed under "Substitution Factor"), and occupy new housing units. These new
households themselves, and their need for affordable housing, are addressed in the Non - Residential
Nexus Study. Their household spending and the need it generates for affordable housing (through the
generation of new jobs) was analyzed in the Residential Nexus Study.
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12
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Discount for Changing Industries
It is general practice in the preparation of a nexus analysis to examine the major sectors of the local
economy and determine if there are long term trends in employment suggesting either decline or
restructuring. In the case of long -term decline of one or more industries or sectors, it is appropriate to
recognize that all new jobs may not be net new jobs. An analysis of the major sectors of the local
economy and their recent trends was performed for this analysis and can be found in Section 2 of this
Report.
4_® ISG
s
17
13
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
SECTION 2: LOCAL ECONOMIC INPUTS AND ADJUSTMENTS
This section examines some of the key local factors that affect the nexus analysis. These items include
market characteristics such as land use types, employee densities, occupational distribution per building
type, and compensation levels. This section also examines several key adjustments which must be made
in the nexus analysis, including those relating to changing industries and employment trends,
unemployment, and commuter patterns.
Employment patterns and trends were determined by analyzing statistics reported in the North American
Industry Classification System ( "NAICS ") report and the annual Occupational 'Employment Statistics
Survey ( "OES ") from the BLS. Industries listed in the NAICS data were matched to building types and
OES occupation categories providing the basis for determining the jobs created by new non - residential
developments. Recent historical trends of employment were determined by analyzing the last five years
of OES statistics.
Building Prototypes
The nexus analysis is centered on the linkages between population growth, new development,
employment, employee salary, and the demand for housing. Non - residential development generally
induces job growth, which results in the demand for housing including an increased need for affordable
housing in the City. The first step in the analysis is to identify what types of non - residential land uses
have recently been developed in the City or are likely to be developed in the future. Specifically, eight
non - residential land uses, as identified in the City's LUCE, and corresponding building types were chosen
for the analysis, including:
1. Office
2. Hospital
3. Hotel (Hospitality)
4. Retail & Entertainment
5. Industrial /Light Manufacturing
6. Institutional
7. Creative /Post Production
8. Medical Office
Employee Density
After identification of land use building prototypes, the next step in the analysis is to estimate the number
of employees who would work in such buildings. For ease of analysis and presentation, a prototypical
100,000 square feet of building area was examined for each of the land use types.
Each land use type has different employment densities as the demand for space is related to the level
and type of employment. Employment densities measure the average amount of space that each
employee occupies. The use of employment densities were used to estimate the number of employees
for each land use type. The employment densities used in this Nexus Study reflect the employee density
factors used in the LUCE. Densities are shown as the number of gross square feet occupied per
employee. Identification of the employee density is derived from factoring the estimated median employee
per acre, which is divided by the median floor area ratio (FAR) for the particular land use building types
(SSG
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18
14
COMMERCIAL NEWS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
adjusted for building efficiency. The following provides the employee densities used for each of the eight
land use building prototypes.
Office — 275 square feet per employee: Average employee office density in urban areas is usually
within the 200 to 300 square feet per employee range, however, these averages typically include
high rise office buildings, which are much more efficient than low -rise offices more commonly
found in suburban areas such as in Santa Monica. Additionally, the density can also vary
depending on the type of office activity, for example, corporate headquarters versus office -
support activities.
Hospital — 560 square feet per employee: The average hospital and medical employee density is
very similar, to office uses. This category includes a variety of uses, from in- patient facilities
where densities are lower, to out - patient facilities where densities are greater because beds and
living facilities are not present.
Hotel (Hospitality) — 1,500 square feet per employee: Hospitality employee densities can vary
greatly depending on the type of hotels present in a geographic area. For example, a City or area
with a larger percentage of full- service hotels will have a greater employee density than an area
with mostly limited - service hotels. This is because full - service hotels include additional facilities
such as restaurants, spas, or retail, and also require a greater level of customer service, thus
increasing the number of employees. According to the LUCE, approximately 40 percent of the
City's hotel inventory are full - service or luxury hotels. The City anticipates both luxury and
limited - service or budget - friendly hotels to be constructed due the City's beachfront proximity and
excellent regional access; an average employee density for these types of hotels was used.
Retail & Entertainment — 425 square feet per employee: This category covers many different
uses, including restaurants, big box retail centers, smaller neighborhood - serving retail centers,
and street -front retail, which is typically found in downtown areas. The City is primarily served by
shopper -good retail such as specialty clothing retail and convenience goods such as
supermarkets and drugstores. According to the LUCE, the City is underserved by major
drugstores and anticipates increased development in the future.
Industrial / Light Manufacturng— 500 square feet per employee: This category includes a variety
of uses, including light industrial, manufacturing, fabricating, business incubator space, emerging
technology, and research and development.
Institutional — 300 square feet per employee: This category covers a wide variety of buildings that
serve the needs of the community including government, education, and cultural facilities.
Creative / Post - Production — 275 square feet per employee: This category includes
entertainment services, post - production industry related to motion pictures and television, and
other information - related occupations. Uses include film and music production, art galleries and
studios, and record production and studios 3.
Medical Office — 500 square feet per employee: This category includes out - patient services.
3 As defined by the 2010 LUCE and BLS.
15
19
COMMERCIA -_ NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Occupational Distribution by Land Use Types
This segment of the analysis involves allocation of jobs by occupation in the land use prototypes. For this
portion of the analysis BLS data on the distribution of different occupational categories was used to
estimate the occupational distribution in each of the land use prototypes.
The North American Industry Classification System groups establishments into industries based on the
activity in which they are primarily engaged at a national level. Establishments that do similar things in
similar ways are classified together. The NAICS reports employment distributions for the 22 industry
sectors shown in Table 2 -1 at the national level 4. The percentages shown in Table 2 -1 represent the
distribution of the major occupational categories within each building prototype. For example, within an
office building, 20.3% of the workers are categorized as being within "office and administrative support
occupations" whereas 5.6% are categorized as "computer and mathematical science" occupations. The
BLS provides statistics that correlate NAICS industry sectors to Occupation Employment Survey
occupation categories at a metropolitan statistical level (MSD). The distributions of occupations within
land use types are used in the Non - Residential Nexus Study to associate the employment generated from
new buildings to occupations and annual incomes.
4 This distribution uses national level data as local NAICS data is not readily available.
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COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Employee Compensation
An important component of the analysis is the compensation paid to employees in the new non-
residential land uses. Since compensation can vary greatly for similar jobs, depending on what
geographic region that job is located in, it is important to use local data when estimating the wages of the
new employees. For this analysis the occupational data previously shown in Table 2 -1 is combined with
wage and salary information from the BLS Occupation Wage Survey for the Los Angeles /Long
Beach /Glendale Metropolitan Statistical District and from the CEDD, as shown in Attachment 1. The
wage and salary information in Attachment 1 was used to calculate the income related to specific
occupations. The OES occupational categories are the same as those used by the CEDD. The
distribution of jobs within the occupational categories was estimated to be the same as the distribution
with the MSD, of which the City of Santa Monica is a part.
Employment Patterns (Industry Change Factor)
During the past four years, the national and regional economies have experienced a significant decline
not seen since the Great Depression. Since 2007, a large number of job losses in certain occupation
groups were mitigated only in part by gains in other occupation groups, while the growth for all
occupations remained fairly flat at less than 1 %. The chart on the following page identifies the percent
change of all the major occupational groups listed by the OES from 2007 -08 through 2011 -12 for the Los
Angeles County MSD. Since 2007, the region experienced substantial losses in management, protective
services, construction, extraction, installation, maintenance and repair occupations. On the bright side,
the region experienced substantial gains in the business and financial, computer and mathematical,
community and social service, and health care occupations. The other occupation groups experienced
modest gains, in part due to shifting occupational choices.
During the period from 2011 to 2012, the California EDD reported the largest year over increases for the
leisure and hospitality employment sector including accommodation and food services, arts,
entertainment and recreation occupations for the Los Angeles Metropolitan Statistical Division. Increases
were also reported for the professional and business services sector, 55% of which was in the
administrative and support services occupation, with gains also occurring in the professional, scientific,
technical and management occupations. The information and government sectors both experienced
declines in employment levels.
The growth in some occupations, along with the steep decline in others, suggests that future new
employment generated by new non - residential land uses will be in some part taken by existing workers
changing from one occupation category to another. To account for this, a conservative 10% reduction
was applied, identified herein as the Industry Change Factor, for jobs generated by the construction of
new non - residential buildings.
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_:
COMMERCIAL, NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Percent Change of Employees by Occupation from 2007 to 2012 (Los Angeles -Long Beach -
Glendale Metropolitan Statistical DhAslon) Hgum 2 -1
Santa Monica Non - Residential Nexus Study
50%
40%
30%
20%
10%
0%
-10%
20%
-s0%
40%
50%
Swace-LYaasuio(IMor Sl Semis Ms OeaM -GMdak MCRmorfm 5ob.ffiml Llivisbn)
Unemployment
New employment generated by the development of new non - residential land uses will also be taken, in
part, by unemployed workers. From 2000 to 2007, the unemployment rate in the City averaged 4.8 %,
while during the period from 2008 to 2010, the City's unemployment rate increased to a high of 10.4 %,
but is beginning to decline, as shown in Table 2 -2. The declining rates during the past three years reflect
improvements in the economy, with the national unemployment rate dropping to 7.3% during the second
quarter of 2013.
Since the Nexus Study analyzes the impacts of future development, it was assumed that the
unemployment rate will again return to the historical average of approximately 4.8% sometime in the
future. The current unemployment rate, however, may serve to reduce the number of new jobs created by
new non - residential buildings and taken by new workers moving to the area. For this reason, the number
of new workers generated by the development of new non - residential land uses was adjusted downward
by 7% to account for existing unemployed (and underemployed) workers who would hypothetically take
some of the new jobs in these land uses (Unemployment Factor). The key assumption for this adjustment
is that the existing unemployed workers already have housing and would not need new housing units.
23
W
r
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Historical Unemployment Rates (Santa Monica)
Table 2 -2
Santa Monica Non - Residential Nexus Study
9.6%
2010
Unemployment
Year
Rate
2000
4.4%
2001
4.6%
2002
5.5%
2003
5.7%
2004
5.3%
2005
4.4%
2006
3.9%
2007
4.1%
Pre - Recession Average
4.8%
2008
6.1%
2009
9.6%
2010
10.4%
2011
10.1%
2012
9.0%
20131
7.6%
Note: The State data varies slightly from the data presented in the City of
Santa Monica Comprehensive Annual Report (June 30, 2011)
1 Preliminary May 2013 figure, published June 21, 2013
Source: State of California Employment Development Department, Historical Unemployment
Rates (Labor Force).
Commute Patterns
This section provides a brief summary of commute trends and relationships. The major relationship of
interest in a nexus analysis is the share of jobs within the City that are held by residents of the City.
There is no empirical data available to identify the number of new employees in the City who would
choose to live in the City. One source of information, however, regarding commute relationships and
patterns is the U.S. Census data, which according to the 2011 American Community Survey data for the
City, reflected that 34% of Santa Monica residents responded that they currently lived in the same city as
where they worked (Santa Monica). Based on this data and data from the 2002 Economic Census, it is
conservatively estimated that a similar number of the new workers in Santa Monica would choose to live
in the City if housing were reasonably available.
It is important to recognize, however, that the above relationship does not necessarily represent the
demand for housing in the City, but it does reflect the historical data regarding housing availability and
occupancy in the City. it should also be noted that even if housing were available and affordable, it is
unlikely that 100% of people would live and work in the same city. The choice of where one lives
depends on many additional factors such as spouse employment, schools, style of housing, types of
amenities, local services, family and social networks, and so on.
For the nexus analysis, as reflected by data identified above, it is projected that 34% of the worker
households in the new non - residential buildings would live in the City.
24
20
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
SECTION 3: MICRO ECONOMIC JOBS HOUSING ANALYSIS
This section details the analysis performed to establish the linkage between the construction of different
types of non - residential land uses and the need for affordable housing in the City. Unlike the analyses
used for the LUCE Environmental Impact Report (EIR) and the Transportation Impact Fee (TIE), which
are based on vehicle trip generation factors, the non - residential development linkage is based on the net
number of jobs directly resulting from the development of new non - residential uses. The analysis
computes the number of new jobs estimated to be housed in the land use building types and the income
categories in which the new workers would typically fall. This section uses data and information from
previous sections, and should not be considered a separate document.
Approach
The micro economic jobs housing analysis establishes the linkage between the construction of new non-
residential buildings and an increased need for affordable housing. The linkage is identified for each land
use land use building type. This section will connect employment growth in the City that results from the
development of non - residential buildings and the need for affordable housing. The analysis starts with a
prototypical 100,000 square feet of building area for each land use building type. Through the series of
steps enumerated below, the total number of workers in each land use type are calculated and then
converted to worker households whose incomes are then estimated. Based on each household's
income, they are placed into the subject income categories (either extremely low -, very low -, low -,
moderate - incomes) and their need for affordable housing is established.
Step 17 Establish Building Prototypes
As discussed in Section 2, the analysis begins with an identification of what types of non - residential land
uses have recently been constructed or may be constructed in the future in the City. This analysis is
conducted based on individual non - residential building types for the land uses identified in the City's
LUCE. For analysis purposes, prototypical 100,000 square feet of building area for each of the land use
types included were analyzed.
Step 2: Estimate Total New Employees
The next step in the nexus analysis is to estimate the number of new direct permanent employees that
would work in each of the eight prototypical non - residential land uses identified in Section 2. The detailed
calculation of new employment is shown in Table 3 -1. Employee density factors were used to estimate
the number of employees in each of the buildings. These factors were based on statistics for Santa
Monica per the LUCE. Employee densities are shown as the amount of building square feet occupied per
employee, which are then used to estimate the total number of new direct permanent employees who will
work in each of the prototype buildings. For example, it is estimated that the employee density factor for
new office buildings is 275 square feet per employee (refer to Section 2 for details regarding employee
densities for each land use). Using this factor, the 100,000 square feet of building area for the office land
use type would house 363.6 employees.
®
PSG
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COMMERCIAL NEXUS FEE ANALYSIS
of Santa Monica
Employee Households Generated by Product Type (Per 100,000 Square Feet) Table 3 -1
Santa Monica Non- Residentlal Nexus Study
Medical
Office Hospital Hotel Retail Industrial Institutional Creative Office
176.6 -66.7 " 235.3 200.0 ' 333.3 ' 363.6
SOn City of Santa Monica,referfo Secflon 2foreWfoyeedensity details by land use.
Step 3: Adjustments for Market Conditions
Adjustments to the total number of new direct permanent employees for each 100,000 square feet of
building type are then made to reflect changes in the local economy, including unemployment and
changing industries. Specifically, declines and /or other shifts in the local economy can affect how new
non - residential buildings are occupied. The adjustments included the following:
® An adjustment is made for changing industries taking into account any declines, changes, or
shifts within specific sectors of the local economy, recognizing that new space is not always
100% equivalent to net new employees. From 2005 through 2007, economic production grew
rapidly, at the end of 2008 and through 2011 economic growth stalled and sharply declined.
Even with the recent decline, however, certain occupation groups achieved substantial gains in
employment. The growth in some occupations, along with the steep decline in others, suggests
that future new employment generated by new non - residential buildings will be in some part taken
by existing workers changing from one occupation category to another. To account for this, a
conservative 10% industry change factor reduction was applied to jobs generated by the
construction of new non - residential buildings. Detailed information regarding industry changes is
provided in Section 2.
An additional adjustment is made for unemployment. From 2000 to 2007, the unemployment rate
in the City averaged 4.8 %, as detailed in Section 2. From 2008 to 2010 the unemployment rate
increased to 10.4% due to the economic recession. More recently, the unemployment rate has
dropped to 7.6% and is expected to continue to decline reflecting the improving economy. The
current unemployment rate will serve to reduce the number of new jobs created by new non-
residential buildings and then taken by new workers moving to the area. For this reason the
number of new workers generated by the development of new non - residential buildings was
adjusted down by 7% to account for existing unemployed workers who would hypothetically take
some of the new jobs in these buildings. Detailed information regarding local and regional
unemployment is provided in Section 2. A 7% unemployment adjustment factor is applied for this
analysis.
These two adjustments, when combined, account for an 17% reduction in the total number of new direct
permanent employees within the non - residential land use prototypes. It is not anticipated that these jobs
will not materialize, but instead will be taken by existing residents in the City or surrounding area, that are
either unemployed or may lose their job because they work in a declining industry. One of the key
assumptions used to make these adjustments is that the existing workers already have housing and
would not need new housing units.
oPSG
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COMMERCIAL. NEXUS STUDY MID LINKAGE FEE ANALYSIS
of Santa Monica
Employee Households Generated by Product Type (Per 100,000 Square Feet)
Table 3 -2
Santa Monica Non - Residential Nexus Study
Medical
Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Prototypical Building Size BF)
100,000
100,000
100,000
100,000
100,000
100,000
100,000
100,000
Building Square Feet per New Employee
275
560
1,500
425
500
300
275
500
Employees per 100,000 SF Building -
363.6
"'178.6
66.7
` 235.3 '
200.0
333.3
' 363.6
200.0
Industry Change Factor (decrease of) t
10%
10%
10%
10%
10%
10%
10%
10%
Unemployment Factor (decrease of)
7%
7%
7%
7%
7%
7%
7%
7%
Employees Generated
301.8
.'.1:148.2
<. 55.3
":195.3.
<166.0
276.7
'. 301.8
166.0
t The Industry Change Factor adjusts for future changes from one occupation to another by existing employees.
Source: 2010 US Census; Bureau of Labor Statistics; Cky of Santa Monica; refer to Section 2 for employee density details by land use.
Step 4: Adjustment from Employees to Employee Households
This step converts the number of employees /workers created into the number of employee households
created. To estimate the number of workers per household in the City, Census data was gathered for the
number of households and the number of individuals in the labor force. Using these datasets it is
estimated that there are 1.13 workers per household in the City. The modified employee density numbers
from Step 3 are adjusted by a factor of 1.13 to identify the number of new worker households.
Employee Households Generated by Product Type (Per 100,000 Square Feet) Table 3 -3
Santa Monica Non - Residential Nexus Study
Medical
Office Hospital Hotel Retail Industrial Institutional Creative Office
Employees per 100,00051- &eliding 3b3.b ':1/66 `. be./ '.236.3 ZUU.0 333.3 '. 363.6 ZUU.0
Industry Change Factor (decrease of) ' 10% 10% 10% 10% 10% 10% 10% 10%
Unemolovment Factor (decrease on 7% 7% 7% 7% 7% 7% 7% 7%
Employees Ueneratent 301.6 7461 r: 0ou 190.3 ibb U:' a /b./ oU1.6 ibaU
Employees per Household" 1.13 1.13 1.13 1.13 1.13 1.13 1.13 1.13
Employee. Households Generated 266.1 ,130.7 48.8 172.2 .146.4: 243.9. 266.1 '146.4
'The Industry Change. Factor adjusts for future changes from one occupation to another by existing employees.
According to the 2000 US Census, them we reapp rouamtely1.13.rmrsperhousehold. Wmker households generated are therefore total employees divided bywn,kers per
household.
Source: W10 US Census; Bureau of Labor Slatisiics City of Santa Monica; refer to Section 2 for employee c@nsity details by land use.
Step 5: Occupational Distribution of Employees
The new worker households created is then associated with occupations and land use types. Utilizing
BLS NAICS codes with the land use types and linking industry sectors to OES occupation categories the
analysis estimates the occupational composition of employees in the different building types. The
occupational mix for each building type is designed to be consistent with the use categories described in
the City Zoning Code. This step is important because it links land use building types with occupation
categories, and occupational categories can be linked to wages in the next step. The occupations that
reflect the expected mix of activities in the new non - residential land uses are shown in Section 2, Table 2-
1 at a national level.
e Office building uses typically reflect a wide range of professional occupations. As summarized in
Table 2 -1, office and administrative support occupations represent the largest percentage of
office related employment at 20.3 %, education, training, and library occupations represent the
next highest percentage at 14.8 %, with Business and financial operations occupations third at
8.2 %. Sales and related occupations, and management occupations are also two of the higher
23
1 R 5C
., 27
COMMERCIAL NEXUS STUDY AND LINKAGE FLU ANALYSIS
of Santa Monica
occupational categories for office buildings, representing 7.8% and 6.6% of the employees
respectively.
• Hospital and medical office building uses occupation distributions are the same and, as expected,
typically house a large amount of healthcare workers. However, the employees also work in
other occupations, such as office and administrative support, and cleaning and maintenance
operations. Healthcare practitioners and technical occupations represent the highest percentage
of employees at 24.3 %, office and administrative support occupations at are also high at
17.4 %,as well as healthcare support occupations at 14.1 %.
• Hotels typically employ workers from three main occupational categories. These occupational
categories include food preparation and serving related occupations at 47.2 %, building and
grounds cleaning and maintenance occupations at 11.7 %, and office and administrative support
occupations at 10.7 %. Together these three occupational categories make up 69.6% of hotel
workers.
• Retail and entertainment uses (restaurants and movie theaters) typically employ workers from
three main occupational categories. They include food preparation and serving related
occupations at 22.2 %, sales and related occupations at 23.2 %, and office and administrative
support occupations at 17.4 %. Together these three occupational categories make up 62.8% of
retail and entertainment use workers.
• Industrial / Light Manufacturing buildings employees are dispersed somewhat more broadly but
the higher distributions occur in three occupation categories. These categories include office and
administrative support at 17.1 %, construction and extraction at 13.2 %, and production
occupations at 13.3 %. Many other occupational categories account for more than 24% of the
employees, including management, business and financial, computer and mathematical,
architecture and engineering, building and grounds cleaning and maintenance, and transportation
occupations.
• Institutional buildings employees are also more broadly dispersed with the highest distribution
occurring in the office and administrative support occupations at 19.4 %, followed by education,
training and library occupations at 12.4 %. and healthcare practitioners and technical occupations
at 10.6 %.
Creative building employees reflect the highest distribution naturally occurring in the arts, design,
entertainment, sports, and media occupations at 17.0% and the computer and mathematical
science occupations at 16.3 %, reflecting a combined 33.3 %. Office and administrative support
occupations, however, has the highest distribution at 19.2 %, while sales and related occupations
comprise 12.9% of the distribution.
Table 3 -4 identifies the total net number of new direct permanent employee households by occupation
(adjusted for unemployment, changing industries, and multiple wage earner households) for each of the
hypothetical 100,000 square feet of building area applying the distribution of occupations by land use
building type at a national level. In the next step correlates these employee occupations with the wages
associated with each occupational category and grouped by income level.
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COMMERCIAL NEXUS STUDY AWLS LINKAGE FEE ANALYSIS
of Santa Monica
Step 6: Estimate Distribution of Employee Wages
In Step Six, the occupational data from Step Five is combined with wage and salary information for Los
Angeles County from the NAICS and CEDD. The wage and salary information summarized in Table 3 -55
was used to calculate the incomes related to specific occupations at a local level. The OES occupational
categories and jobs are the same as those used by the CEDD. The distribution of jobs within the
category was estimated to be the same as the distribution within the Los Angeles -Long Beach - Glendale
MSD, of which the City is a part. Mean incomes for each job type were taken from the NAICS and CEDD
for Los Angeles County, that were then converted from an in individual employee /worker to household
wages using the employees per household ratio (1.13) and used to estimate the number of very low -, low -
and moderate - income households in each occupational category in Step 7.
DES Occupation Categories with CEDD Wage Data for Los Angeles-Long Beach - Glendale MSD Table 3 -5
Santa Monica Non - Residential Nexus Study
Sources: 2010 US Census Bureau of Labor Statistics; and California Department of Housing and Community Development
Step 7: Estimate Household Income Category Distribution
The individual wage data was used to estimate the number of households that fall into the very low -, low -,
and moderate - income categories by assuming that individuals in multiple- earner households, on average,
earn a similar wage. The same ratio of workers - per - household used in Step Three, was used to adjust
the wage data for individual employees to that of households. Households of more than one person were
conservatively estimated to, on average, have more than one worker.
a More detailed wage data is identified in Attachment 1.
26
R S G
C'° 30
% of Employees in Specific
Total Employees
Occupations of Each Major
Mean Annual
DES Occupation Category
in MSD
Category
Wage
All Occupations
''- 3,871,190
:'.$52,130'.
Management Occupations
213,120
5.5%
$122,930
Business and Financial Operations Occupations
210,760
5.4%
$74,910
Computer and Mathematical Occupations
95,740
2.5%
$84,710
Architecture and Engineering Occupations
71,400
1.8%
$91,630
Life, Physical, and Social Science Occupations
33,220
0.9%
$75,830
Community and Social SeNce Occupations
63,000
1.6%
$50,790
Legal Occupations
38,440
1.0%
$124,160
Education, Training, and Library Occupations
235,550
6.1%
$59,360
Arts, Design, Entertainment, Sports, and Media Occupations.
143,960
3.7%
$87,920
Healthcare Practitioners and Technical Occupations
199,510
5.2%
$85,170
Healthcare Support Occupations
99,780
2.6%
$30,710
Protective SeNce Occupations
109,500
2.8%
$49,370
Food Preparation and Serving Related Occupations
336,370
8.7 %
$21,750
Building and Grounds Cleaning and Maintenance Occupations
102,110
2.6%
$26,660
Personal Care and Serne Occupations
88,320
2.3%
$27,690
Sales and Related Occupations
398,300
10.3%
$40,440
Office and Administrative Support Occupations
696,120
18.0%
$37,530
Fanning, Fishing and Forestry Occupations
2,840
0.1%
$26,990
Construction and Extraction Occupations
89,830
2.3%
$54,090
Installation, Maintenance, and Repair Occupations
116,370
3.0%
$48,490
Production Occupations
249,130
6.4%
$31,800
Transportation and Material MoNng Occupations
277,830
7.2%
$33,710
Sources: 2010 US Census Bureau of Labor Statistics; and California Department of Housing and Community Development
Step 7: Estimate Household Income Category Distribution
The individual wage data was used to estimate the number of households that fall into the very low -, low -,
and moderate - income categories by assuming that individuals in multiple- earner households, on average,
earn a similar wage. The same ratio of workers - per - household used in Step Three, was used to adjust
the wage data for individual employees to that of households. Households of more than one person were
conservatively estimated to, on average, have more than one worker.
a More detailed wage data is identified in Attachment 1.
26
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C'° 30
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
After adjusting individual employee income to household income, those households were placed in
income categories based on the 2013 AHPP income limits. Household size distribution is based on
Census data for the City. After households have been distributed into size categories they now have
income and size associated with them. These two sets of data allow the households to be distributed into
the AHPP income categories, which are categorized by household size and income. Table 3 -6 reflects
the 2013 qualifying household income limits for the City as established in the AHPP.
2013 Income Limits by Household Size (Santa Monica) Table 3 -6
Santa Monica Non - Residential Nexus Study
Very Low Income $29,900 $34,200 $38,450 $42,700 $46,150 $49,550 $52,950
Low Income $47,850 $54,650 $61,500 $68,300 $73,800 $79,250 $84,700
Moderate Income $54,450 $62,200 $70,000 $77,750 $83,950 $90,200 $96,400
Source: California Department of Housing and Community Development 2013 Income Limits
Step 8: Estimate New Households that Meet Income Criteria
This step allocates the new worker households created into specific income categories (extremely low -
,very low -, low -, and moderate - incomes) pursuant to the City's AHPP 2013 income categories as
indicated in Table 3 -6. Households falling at or below the income limits were placed in their
corresponding income category. After all worker households were placed into their respective income
categories, totals were generated for each income category. Table 3 -7 summarizes the total number of
new worker households by land use type and income category, before an adjustment for employee
commuters is made.
Generated Need for Affordable Housing -Before Adjusting for Commuters
Table 3 -7
Santa Monica Non - Residential Nexus Study
Medical
Household Income Categories Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Extremely Low Income 16.7
10.5
17.4
38.6
16.7
14.7
13.8
11.8
Very Low Income 84.5
53.1
20.6
70.8
55.3
79.4
61.0
59.5
Low Income 57.5
26.7
5.3
30.1
36.1
51.6
59.9
29.9
Generated 179.0 195.7 44.3.. 146.2. 117.5 162.9
266.1 - :'.130.7 ..48.8 172.2 146.4... 243.9 266.1 146.4 -
Note: Refer to Attachment l for detailed wage data by owupation type.
Souxes: US Census Bureau, Bureau of Labor Statistics, Califomia Department of Housing and Community Development, and City of Santa Monica
Step 9 Calculate Worker Households Income Categories and Adjust for Commute Patterns
This step adjusts the total number of worker households needing affordable housing by the percentage of
current workers in the City who may also live in the City. This adjustment is made because, as discussed
in Section 2, not all of the new employees in new non - residential buildings will live in the City. This
adjustment is reflected in Table 3 -8, which shows the total number of new worker households, by income
category and building type that would live in the City. This also reflects the number of affordable housing
units needed to accommodate the new employment in the City that results from the non - residential land
types.
® 1\SG
31
27
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Generated Need for Affordable Housing -After Adjusting for Commuters Table 3 -B
Santa Monica Non - Residential Nexus Study
of Santa Monica Employees with Jobs inside City limits 34%
-.61.2 <. 32.7 ,'15.2 50.0 40.2 55.7 ` %529 "36.6
91.0 44.7 ''16.7 5B.9.. 50.0 83.4 -91.0 -
Note: Refer to Attachment t for detailed wage data by occupation type.
Sources: US Census Bureau, Bureau of Labor Statistics, California Department of Housing and Community Development and City of Santa Monica
Step 10 - Calculate Total Affordable Housing Needs Created by Non - Residential Buildings
The final step in the analysis adjusts the worker household per 100,000 square feet of land use building
area to calculate the total worker households, by income category, that would live in the City based on
anticipated City growth. This is reflected in Table 3 -9, which multiplies the factors identified in Table 3 -8
by the total estimated square feet for the non - residential building types to be developed during the period
2010 to 2030, as identified in the LUCE. The resulting total net new worker households living in the City
serves to reflect the total number of affordable housing units, by income category, which is attributable to
the total estimated non - residential building types if the City were to be built -out as envisioned in the
LUCE.
Total Projected Affordable Housing Need (2010 -2030)
Table 3.9
Medical
Household Income Categories
Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Extremely Low Income
5.7
3.6
5.9
13.2
5.7
5.0
4.7
4.0
Very Low Income
28.9
18.1
7.1
24.2
18.9
27.1
20.9
20.3
Low Income
19.6
9.1
1.8
10.3
12.3
17.7
20.5
10.2
Moderate Income
70
1.8
0.3
23
39
5 B
6 q
9 1
-.61.2 <. 32.7 ,'15.2 50.0 40.2 55.7 ` %529 "36.6
91.0 44.7 ''16.7 5B.9.. 50.0 83.4 -91.0 -
Note: Refer to Attachment t for detailed wage data by occupation type.
Sources: US Census Bureau, Bureau of Labor Statistics, California Department of Housing and Community Development and City of Santa Monica
Step 10 - Calculate Total Affordable Housing Needs Created by Non - Residential Buildings
The final step in the analysis adjusts the worker household per 100,000 square feet of land use building
area to calculate the total worker households, by income category, that would live in the City based on
anticipated City growth. This is reflected in Table 3 -9, which multiplies the factors identified in Table 3 -8
by the total estimated square feet for the non - residential building types to be developed during the period
2010 to 2030, as identified in the LUCE. The resulting total net new worker households living in the City
serves to reflect the total number of affordable housing units, by income category, which is attributable to
the total estimated non - residential building types if the City were to be built -out as envisioned in the
LUCE.
Total Projected Affordable Housing Need (2010 -2030)
Table 3.9
Santa Monica Non - Residential Nexus Study
Medical
Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Total
Estimated 2010 LUCE Net Change 448,980
763,123
628,578
566,803
0
196,029
699,709
187,327
3,490,549
Extremely Low Income 25.6
27.4
37.3
74.8
0.0
9.8
33.1
7.5
215.5
Very Low Income 1291
138.5
44.8
137.1
0.0
53.2
146.0
38.1
687.3
Low Income 88.2
69.6
11.4
58.4
0.0
34.7
143.2
19.1
424.5
v oral ngemssmtalveeapanerarea -[14.1 zgy.o.: yV,J 203.L -' U.U. 109.2 31U3 55.6 1450.0'-
BAs discnssed In this Report, the Ineome Limits far Los Angeles County ate unlqub In that lower income is equal to median income.
Sources: City or Santa Monica Land Use aM Circulation Element (LUCE, 20fo), US Census aureuu; Bureau or Labor Slatidies, and Catiromia Dapadmen( of Housing and Communlly
Summary
As summarized in Table 3 -9, the total development of 3.49 million square feet of non - residential buildings
to be developed during the period 2010 -2030 would generate about 2,082 new worker households living
in the City; 1,451 of those households would earn less than 120 %' of the area median income, of which
1,327 would be lower- income (extremely low -, very low- and low- incomes). For non- residential buildings,
the highest new worker household generating land use building type is creative, followed by hospital and
medical offices, followed by office, then retail buildings.
The net new worker household data for each building type shown in Table 3 -9 is summarized as follows:
a _ 28
32
COMMERCIAL. NEXUS STUDY AND LINKAGE rEE ANALYSIS
of Santa Monica
1. The development of 950,450 square feet of hospital and medical buildings would generate a total
of 434.6 worker households living in the City; 318.1 of those households would earn less than
120% AMI, of which 300.1 would be lower- income.
2. Similarly, the development of 448,980 square feet of office buildings would generate a total of
408.4 new worker households living in the City; 274.7 of those worker households would earn
less than 120% of the area median income, of which 243.5 would be lower- income.
3. The estimated 566,803 square feet of retail development would generate 333.6 worker
households living in the City; 283.2 of those worker households would earn less than 120% AMI,
of which 270.2 would be lower- income.
4. The estimated 699,709 square feet of creative buildings would generate 636.5 worker households
living in the City; 370.3 of those worker households would earn less than 120% AMI, of which
322.2 would be lower- income, reflecting the lowest percentage (50.6 %) of lower income
households of any land use building type.
5. In contrast, the development of 628,578 square feet of hotel buildings would generate 104.8
worker households; 95.3 of those worker households would earning less than 120% AMI, of
which 93.4 would be lower- income, reflecting the highest percentage (89.1 %) of lower income
households of any building type.
6. The development of 196,029 square feet of institutional buildings would generate a total of 163.5
new worker households living in the City; 109.2 of those households would earn less than 120%
of the area median income, of which 97.8 would be lower- income.
Since the Industrial land use category is not expected to grow, there is no net employment generation
reflected for the land use.. The data presented in the tables above are used in Section 5 to produce to
total supportable per square foot impact linkage fees for each building type.
v °a
_Y ®" I v
33
29
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
SECTION 4: AFFORDABLE HOUSING COSTS
The Non - Residential Nexus Study as presented in Sections 1 — 3 demonstrated the demand generated
for new affordable housing units in the City as a result of the development of eight prototypical non-
residential buildings identified in the LUCE. This demand is presented in terms of worker households
which in turn generate the need for new housing units. In order to translate this need into an appropriate
impact fee, the cost to develop affordable housing units in the City must be calculated. Discussions with
City staff along with a review of currently proposed and recently completed projects in the City indicate
that multifamily rental housing units (apartments) rather than ownership housing units (townhomes or
condominiums) will be primarily developed in the City and will be the primary residential option for new
worker households of very low -, low -, and moderate - incomes. Therefore, the following analysis is based
on costs associated with rental housing units. A prototypical apartment development with a density of 50
dwelling units per acre was created to estimate the cost to develop affordable units in the City. The
impact linkage fees calculated in Section 5 use the estimated development cost to identify the funding
gap associated with the construction of a rental product.
Introduction
Affordable housing costs are generally a function of the Qualifying Income Limits and the Area Median
Income adjusted for family size appropriate to the unit. As discussed previously, the City's AHPP defines
qualifying annual income limits and establishes the maximum allowable monthly rents per income
category adjusted for household size appropriate for the unit. A summary of the AHPP 2013 Qualifying
Income Limits is provided in Table 3 -6.
The calculation of affordable housing rents is based on the allowable limitation by income category of a
household, adjusted for family size, multiplied by the area median income adjusted for that household
size.
Affordable Housing Cost
Affordable housing cost for rental units is established annually for the AHPP to reflect the affordable
housing cost, including an allowance for utilities, in terms of the maximum affordable monthly rent per
income category adjusted for household size as a percentage of the gross AMI allowing for the deduction
of an allowance for utilities. The AHPP calculation of affordable rent is as follows:
• For extremely low- income households, the product of 30% times 30% of the AMI adjusted for
family size appropriate for the unit.
• For very low- income households, the product of 30% times 50% of the AMI adjusted for family
size appropriate for the unit.
• For low- income households, the product of 30% times 60% of the AMI adjusted for family size
appropriate for the unit.
• For moderate - income households, the product of 30% times 100% of the AMI adjusted for family
size appropriate for the unit.
The AHPP 2013 maximum affordable gross monthly rent, before deducting an allowance for utilities, for
each income category by unit size is summarized in Table 4 -1.
C a IZSG 30
34
COMMERCIAL NEXUS STUDY AND LINKAGE fF E ANAI-,Y SIS
of Santa Monica
2013 Maximum Monthly Affordable Rents
Table 4 -1
Santa Monica Linkage Fee Analysis
Extremely Low
Maximum Allowable Very-Low Maximum
Low Maximum
Moderate Maximum
Unit Type
Rent Allowable Rent
Allowable Rent
Allowable Rent
Studio
$340
$567
$680
$1,247
1 Bedroom
$389
$648
$778
$1,426
2 Bedroom
$437
$729
$875
$1,603
3 Bedroom
$486
$810
$972
$1,782
4 Bedroom
$525
$875
$1,050
$1,925
Basedon California Departmentof Housing and CommunityDevelopment2013 Income Limits
Rental Apartments Valuation
The valuation of rental apartment units is a function of the annual gross income of a unit reduced by
vacancies and operating expenses to determine the net operating income ( "N01f). The industry practice
in establishing the value of rental units is to apply a reasonable market capitalization rate to the NOI to
identify the value based on the ability to achieve a comparable investment rate to similar properties.
Since vacancies and operating costs are generally spread evenly across all units in a project, it is fairly
easy to determine the NOI potential of a unit based on comparable market vacancy factors and operating
costs. A lenders underwriting standards would generally use a 5% vacancy factor. Comparable annual
operating expenses (excluding real estate taxes) for an affordable rental unit are approximately $5,600
per unit. The exclusion of real estate taxes for affordable apartments is deemed reasonable under the
assumption that most affordable apartment projects are constructed in conjunction with non -profit housing
developers and receive exemptions from property taxes.
In estimating the value of rental apartment projects, it is useful to use a weighted average basis reflecting
the blended rents, mix of bedrooms and unit sizes in a project based on similar affordable rental
apartments in the area. In Santa Monica, the bedroom size -unit mix for market -rate and affordable rental
apartment projects is fairly similar. For purposes of this analysis for a typical 50 unit affordable apartment
development, a mix of 25% studio units, 25% one - bedroom, 25% two - bedroom and 25% three - bedroom
units of 500, 600, 850, and 1,080 square feet respectively is used, with the weighted average unit size of
about 758 square feet. The affordable net monthly rent, after deducting an allowance for utilities, for each
unit size and income category is used to determine the weighted average rent for each income category,
as follows:
• For extremely low- income units the weighted monthly rent is $351 ($0.46 /s.f.)
• For very low- income units the weighted monthly rent is $626 ($0.83 /s.f.).
• For low- income units the weighted monthly rent is $764 ($1.01 /s.f.).
• For moderate - income units the weighted monthly rent is $1,452 ($1.92 /s.f.).
The market value gap reflects the difference between the capitalized value of the affordable unit and
estimated cost to develop the unit, which will generally closely approximate the costs of constructing
market rate units in the area. A key distinction between the market value gap and the development
35
31
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
funding gap is that the capitalized value of the market rate unit may exceed the actual development cost
of the unit, due to the market forces of supply and demand which may serve to increase prices above the
cost to produce or replace the unit. Use of the capitalization approach to identify the value of income -
restricted affordable units is problematic in that the selection of the appropriate capitalization rate is
impeded by investor perception of risks associated with the long -term rent restrictions which may not
keep pace with inflating operating costs. Tables 4 -2 and 4 -3 reflect the calculation of the capitalized
values and the respective market value gap for affordable rental units under the City's AHPP.
2013 Monthly Affordable Rents Market Capitalization (per Unit) Table 4 -2
Santa Monica Linkage Fee Analysis
I Extremely Low - Income categorygross income does notexceed operating costs. Therefore, the gross income amount
includes an additional $140 /month rentsubsidyto cover operating costs, which could be com prised ofCDBG or
(bpi allocation.
Rental Apartment Market Valuation Gap (per Unit) Table 4 -3
Santa Monica Linkage Fee Analysis
Extremely Low-
Extremely Low-
Very Low-
Low-
Moderate -
Income
Incomet
Income
Income
Income
Gross Income
$5,895
$7,514
$9,167
$17,428
Less 5 %Vacancy
($295)
($376)
($458)
($871)
Less Operating Costs
($5,600)
($5,600)
($5,600)
($5,600)
Net Operating Income
$0
$1,539
$3,108
$10,956
Capitalized Value @ 5.5% Rate
$0
$56,512
$199,207
I Extremely Low - Income categorygross income does notexceed operating costs. Therefore, the gross income amount
includes an additional $140 /month rentsubsidyto cover operating costs, which could be com prised ofCDBG or
(bpi allocation.
Rental Apartment Market Valuation Gap (per Unit) Table 4 -3
Santa Monica Linkage Fee Analysis
Extremely Low-
Very Low-
Low-
Moderate-
Income�
Income
Income
Income
Unit Value2 $0
$27,973
$56,512
$199,207
Construction Cost23 ($274,391)
($274,454)
($274,519)
($274,844)
Allocated Land Cost2 ($130,000)
($130,000)
($130,000)
($130,000)
Market Valuation Gap ($454,640) ($376,481) ($348,007) ($205,637)
Unit Value for Extremely Low Income category is zero due to the fact that the gross rent revenue does not exceed estimated
operating costs. The Market Valuation Gap referenced reflects the inclusion of an additional rental subsidy ($140) amortized
at 2 %, which equates to an increase of $50,249.
2 Refer to Attachment 2 for calculations
3 Based on a 6.0% Loan and 6.5% construction interest.
Note: Allocated Land Cost based on $149.22 per square foot divided by the assumed 50 units per acre density.
RSC
36
32
COMMERCIAL NEXUS STUDY AND LINKAGE FEE —ANALYSIS
of Santa Monica
Affordable Housing Development Funding Gap
The development funding gap is more useful in reflecting the subsidy or assistance amounts needed to
create affordable housing units for multifamily rental units. Calculation of the development funding gap
analysis reflects the difference between the total cost of developing the unit and the amortized value of
the net operating income of the unit, as reflected by the maximum supportable loan amount and the
capitalized value of excess cash flow. Two steps are used to illustrate the incremental increases in the
funding gap associated with affordable housing units including the calculation of the construction funding
gap and calculation of the development funding gap that reflects the inclusion of the land cost.
The major cost components for affordable housing units are similar to those for market rate units in terms
of unit -cost, with the exception perhaps for somewhat smaller unit sizes, slightly lower quality materials
and finishes, and a lower developer fee. For this analysis, the estimated development costs were based
on independent construction cost data obtained from Marshall and Swift Valuation Services, which is a
national comprehensive database that is updated monthly and serves the development and insurance
industries. Since a nexus analysis should address the lower end of the housing market to reflect
affordability, this analysis focuses on rental apartments (see Attachment 2 for multifamily rental housing
pro forma).
For affordable rental apartments, the construction funding gap is reflected by the difference between the
direct construction cost of the unit and the amortized value of the affordable unit's projected net operating
income. The construction funding gap amount is increased for the allocated land cost to reflect the total
development funding gap associated with producing the affordable units. The weighted average
development funding gaps for an affordable rental unit by income level are summarized in Table 4 -4.
Rental Apartment Development Funding Gap (per Unit) Table 4.4
Santa Monica Linkage Fee Analysis
Extremely -Low
Very-Low
Low
Moderate
Income
Income
Income
Income
Amortized NOI $0
$22,244
$44,938
$158,406
Construction Costt 2 ($274,391)
($274,454)
($274,519)
($274,844)
Allocated Land Cost' ($130,000)
($130,000)
($130,000)
($130,000)
Development Funding Gap ($454,640) ($382,210) ($359,582) ($246,438)
r Amortized NOI for Extremely Low Income category is zero due to the fact that the gross rent revenue does not exceed estimated
operating costs. The Development Funding Gap referenced reflects the inclusion of an additional rental subsidy ($140) amortized
at 2 %, which equates to an increase of $50,249.
3 Refer to Attachment 2 for calculations
' Based on a 6.0% Loan and 6.5% construction interest.
Note: Allocated Land Cost based on $149.22 per square foot divided by the assumed 50 units per acre density.
37
33
COMMERCIAL NEXUS .STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
The development funding gap amounts shown in Table 4 -4 were used in conjunction with the affordable
housing need calculated by the nexus analysis in Section 3, to determine the applicable impact linkage
fees for new non - residential buildings, as discussed in Section 5.
`p r
38
34
C®RIAEROIAL NE)CUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
SECTION 5: FEE ANALYSIS AND RECOMMENDATIONS
The Affordable Housing Impact Linkage Fee ("Linkage Fee ") for non - residential projects in the City
reflects the financial equivalent needed to develop housing units affordable to extremely low -, very low -,
low- and moderate- income persons and families in accordance with the quantified housing needs
generated by the development of non - residential projects, as shown in the Non - Residential Nexus Study.
The estimated funding deficit or "gap" amount reflects the cost associated with developing housing units
affordable to extremely low -, very low -, low -, and moderate - income households. The estimated funding
gap is determined based on the difference between the total allowable housing cost, as reflected by the
amortized value of the operating income for each income category, and the estimated cost to develop the
affordable housing unit.
Approach and Methodology
The methodology for identifying the full financial equivalent of producing affordable housing units reflects
the assumption that the impact is reflected by the total funding gap associated with the cost of producing
the required affordable housing unit(s). The following summarizes the methodology used for identifying
the development funding gap and the corresponding impact fee amounts.
1. Identification of the current affordable housing costs in accordance with the requirements under
the H &SC and the AHPP, which provides the methodology for calculating affordable housing
costs for rental units.
2. Determination of the total rent revenue, with deductions for utilities, based on the maximum net
rent limits per each income category.
3. Preparation of development financial including pro forma cost analysis for a prototypical rental
apartment (50 dwelling units /acre) on a weighted unit basis using comparable market building
prototypes and unit sizes to estimate direct and indirect construction costs, financing costs, base
developer fee, and estimated land costs, to identify the total estimated development costs. A
detailed development financial pro forma for the prototypical rental apartment complex is included
as Attachment 2.
4. Calculation of the net operating income reflecting the difference between the total annual net rent
revenues less the annual operating expenses, which is use to establish the amortized value or
maximum loan amounts that may be derived for each income category.
5. The difference between the total estimated development cost and the full amortized value of the
net operating income per unit reflects the affordable development funding gap associated with the
affordable rent for each income category.
6. The weighted average development funding gap for each income category is then multiplied by
the income category's proportion of the total affordable units generated, as reflected in the Non -
Residential Nexus Study (Section 3).
e ®6 RSG
RE
35
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Rental Apartment Projects
The median market rental rates for apartments within the City were reviewed to identify the market rental
rate based on unit sizes and median rents. The data was used to identify the median market rent as
$1,470 per month, while the corresponding weighted affordable housing rent is $351 for extremely low -
income unts, $626 for very low- income units and $764 for low- income units. As identified in Section 4,
current market conditions and construction cost estimates for a prototypical 50 -unit apartment
development would result in development funding deficits for affordable apartment units as follows (refer
to Table 4 -4):
Extremely Low - Income Unit $454,640
Very Low - Income Unit $382,210
Low - Income Unit $359,582
Moderate - Income Unit $246,438
As footnoted, the weighted extremely low- income rent at $351 is not sufficient to fund the annual operating
expenses for the unit and must therefore rely on an additional monthly rent subsidy of $140 per unit. The
rent subsidy amount is amortized a 2% for 30 years to identify present value, which is added to the cost in
order to identify the total gap funding amount for the extremely low- income units (see Attachment 2).
The indicated development funding deficits reflect the financial impacts associated with producing the
affordable rental units without the benefit of tax credits to leverage the project, which would also reflect
the 100% impact fee amount necessary for the City to produce an affordable unit for each income
category. Affordable rental apartment projects often receive financial assistance from local, State, and
Federal funding sources including 4% or 9% low income housing tax credit equity to reduce the funding
deficits to make the development more financially feasible. The future availability of such assistance,
however, cannot be assured. Accordingly, the funding gap analysis uses the 100% funding gap amount
as the basis for determining the impact fee amounts. Table 5 -1 identifies the development funding deficits
for affordable rental units.
Apartment Unit Gap Summary Table 5 -1
Santa Monica Linkage Fee Analysis
r Apartment development assumption based on 50 dulac density with market mix reflecting 25% Studio, 25% 1 SR units, 25% 2 BR
units, and 25% 3 BR units
2 Development assumptions based on a 6.0% loan and 6.5% construction interest.
3 Weighted cost per unit for all income categories.
Source: Refer to Attachment 2
36
40
Extremely Low-
Very Low - Income
Low - Income
Moderate - Income
Income Unit
Unit
Unit
Unit
Construction Funding Gape :
($274,391)
($252,210)
($229,582)
($116,438)
(excludes land cost allocation)
Total per unit construction costs :
$274,577
Development Funding Gape :
($454,640)
($382,210)
($359,582)
($246,438)
(includes land cost allocation)
Total per unit development cost ':
$404,577
r Apartment development assumption based on 50 dulac density with market mix reflecting 25% Studio, 25% 1 SR units, 25% 2 BR
units, and 25% 3 BR units
2 Development assumptions based on a 6.0% loan and 6.5% construction interest.
3 Weighted cost per unit for all income categories.
Source: Refer to Attachment 2
36
40
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Impact Linkage Fee Calculation
As indicated above, the recommended methodology for identifying a maximum impact fee amount reflects
the assumption that the Linkage Fee should reflect the amount necessary to fund 100% of the cost to
develop the affordable unit(s); that is the full production cost of the affordable unit. The funding gap is
translated into a per square foot fee by utilizing the unit need per 100,000 square foot by income
category. The financial impacts associated with the affordable housing units are determined by
multiplying the development funding gap by the affordable housing generated need as identified in Table
3 -8 of the Nexus Study (shown below).
Generated Need for Affordable Housing - After Adjusting for Commuters Table 3 -8
Santa Monica Non - Residential Nexus Study
% of Santa Monica Employees with Jobs inside City limits 34%
I OtaI HROWaOle Neetl Generatea : .01.2 ':3Z./ 1b.Z 'WU'r 4D.Z bb./ °bZ.9 - 30.0
Over - Moderate Income 29.8 12.0 1.5 8.9 9.9 27.7 38.0 13.4
44.7 :;16.7- 56.9 `.` 50.0 63.4 :.91.9 "50.0
Note: Refer to Attachment l for detailed wage data by occupation type.
Sources. US Census Bureau, Bureau of Labor Statistics Califomia Department of Housing and Community Deyelo ment, and Cily of Santa Monica
The Linkage Fee for each land use type on a per square foot basis is derived by multiplying the gap
funding amount times the number of households indentifed in Table 3 -8 for each building type, with the
sum divided by 100,000 based on the 100,000 square foot building prototype. For example, the per
square foot linkage fee for extremely low- income units without any financial assistance for the office
building type is calculated as follows:
$454,640 (Gap) X 5.7 (Households) = $2,591,448 /100,000 square feet = $25.91
The impact fee for each income group and land use type is calculated as illustrated above, with the sum
of the impact fees for each income group within each land use type identifying the full impact fee
associated with each land use type. Table 5 -2 identifies the full impact fee per square foot as a result of
the construction of non- residential development for the three scenarios identified above. Table 5 -2 also
provides reduced impact fee alternatives of between 5% and 25 %, as found in other communities to
mitigate the cost impacts to future non - residential development in the City. The reduced impact fee
considerations are addressed below.
$R1 C
41
37
Medical
Household Income Categories
Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Extremely Low Income
5.7
3.6
5.9
13.2
5.7
5.0
4.7
4.0
Very Low Income
28.9
18.1
7.1
24.2
18.9
27.1
20.9
20.3
Low Income
19.6
9.1
1.8
10.3
12.3
17.7
20.5
10.2
Moderate Income
7.0
1.8
0.3
2.3
3.2
5.8
6.9
2.1
I OtaI HROWaOle Neetl Generatea : .01.2 ':3Z./ 1b.Z 'WU'r 4D.Z bb./ °bZ.9 - 30.0
Over - Moderate Income 29.8 12.0 1.5 8.9 9.9 27.7 38.0 13.4
44.7 :;16.7- 56.9 `.` 50.0 63.4 :.91.9 "50.0
Note: Refer to Attachment l for detailed wage data by occupation type.
Sources. US Census Bureau, Bureau of Labor Statistics Califomia Department of Housing and Community Deyelo ment, and Cily of Santa Monica
The Linkage Fee for each land use type on a per square foot basis is derived by multiplying the gap
funding amount times the number of households indentifed in Table 3 -8 for each building type, with the
sum divided by 100,000 based on the 100,000 square foot building prototype. For example, the per
square foot linkage fee for extremely low- income units without any financial assistance for the office
building type is calculated as follows:
$454,640 (Gap) X 5.7 (Households) = $2,591,448 /100,000 square feet = $25.91
The impact fee for each income group and land use type is calculated as illustrated above, with the sum
of the impact fees for each income group within each land use type identifying the full impact fee
associated with each land use type. Table 5 -2 identifies the full impact fee per square foot as a result of
the construction of non- residential development for the three scenarios identified above. Table 5 -2 also
provides reduced impact fee alternatives of between 5% and 25 %, as found in other communities to
mitigate the cost impacts to future non - residential development in the City. The reduced impact fee
considerations are addressed below.
$R1 C
41
37
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Per Square Foot Non - Residential Impact Fees without LIHTC Mitigated Funding Table 5 -2
Santa Monica Linkage Fee Analysis
3 -8
Impact Linkage Fee Consideration
For comparison purposes, a survey of similar jurisdictions' non - residential impact linkage fees was
conducted, with the result summarized in Table 5 -5. There is a wide range in the linkage fee amounts
imputed, which nevertheless reflect a fairly substantial reduction from the full cost associated with the
affordable housing funding gap. In the immediate area, the City of Los Angeles has recently completed a
nexus study and linkage fee analysis using a similar approach and methodology as this Report. While
still pending review and action, the Los Angeles linkage fee alternatives appear to be similar as those
evaluated herein, reflecting a range for consideration from the lower -end range to the higher -end range
as identified and discussed below.
The full financial impacts associated with the demand generated by non- residential uses in Santa Monica
are very substantial, with the full added costs very likely to impede future development in the City.
Accordingly, reduced fee levels were evaluated, which are meant to avoid adverse economic impacts on
the developers of new non - residential projects in the City. A range of reduced fee amounts of between
5% and 25% were evaluated for comparison to other jurisdictions, as well as to identify to potential cost
impacts to the construction of the various building types (see Attachment 3). The low -, mid -, and high -
range fee amounts at 5 %, 10% and 15% respectively, generally reflect the range of fees imputed in other
jurisdictions, with San Francisco being highest at the mid - range. The fee schedule range under review in
the City of Los Angeles ($5.69 to $18.09 at the reduced 15% level) is slightly lower than the reduced 10%
level reflected in this Report primarily due to the lower affordable housing funding gap requirements in the
City, which result from a combination of lower cost building types, lower land costs, and no prevailing
wage impacts.
d
R"IG
42
38
Development
Medical
Funding Gap
Office
Hospital
Hotel
Retail
Industrial
Institutional
Creative
Office
Average
Extremely Low Income
$454,640
$25.91
$16.35
$26.99
$59.96
$25.91
$22.80
$21.48
$18.31
$2711
Very Low Income
$382,210
$110.44
$69.36
$27.21
$92.44
$72.31
$103.76
$79.72
$77.68
$79.12
Low Income
$359,582
$70.63
$32.77
$6.51
$37.03
$44.36
$63.65
$73.59
$36.71
$45.66
Moderate Income
$246,438
$17.13
$4.54
$0.73
$5.64
$7.94
$14.34
$16.94
$5.09
$9.04
Full Impact Fee
$224.11
$123.02
$61.43
$195.07
$150.52
$204.55
$191.74
$137.78
$161.03
-
'5%
- $11.21
':$6.15
'$3.07
$9.75
"$7.53
$10.23
- .$9.59
$6.89
$8.05
Impact Fee Options
10%
$22.41
$12.30
$6.14
$19.51
:$15.05
$20.45
$19.17
- .$13.78
$16.10
L(per Square Foot)
15%
$33.62
$18.45
$9.21
$29.26
$22.58
$30.68
$28.76
$20.67
$24.15
20%
$44.82
$24.60
$12.29
$39.01
$30.10
$40.91
$38.35
$27.56
$32.21
25%
$56.03
$30.76
$15.36
'$48.77
- $37.63
$51.14
$47.93
$34.45
$40.26
3 -8
Impact Linkage Fee Consideration
For comparison purposes, a survey of similar jurisdictions' non - residential impact linkage fees was
conducted, with the result summarized in Table 5 -5. There is a wide range in the linkage fee amounts
imputed, which nevertheless reflect a fairly substantial reduction from the full cost associated with the
affordable housing funding gap. In the immediate area, the City of Los Angeles has recently completed a
nexus study and linkage fee analysis using a similar approach and methodology as this Report. While
still pending review and action, the Los Angeles linkage fee alternatives appear to be similar as those
evaluated herein, reflecting a range for consideration from the lower -end range to the higher -end range
as identified and discussed below.
The full financial impacts associated with the demand generated by non- residential uses in Santa Monica
are very substantial, with the full added costs very likely to impede future development in the City.
Accordingly, reduced fee levels were evaluated, which are meant to avoid adverse economic impacts on
the developers of new non - residential projects in the City. A range of reduced fee amounts of between
5% and 25% were evaluated for comparison to other jurisdictions, as well as to identify to potential cost
impacts to the construction of the various building types (see Attachment 3). The low -, mid -, and high -
range fee amounts at 5 %, 10% and 15% respectively, generally reflect the range of fees imputed in other
jurisdictions, with San Francisco being highest at the mid - range. The fee schedule range under review in
the City of Los Angeles ($5.69 to $18.09 at the reduced 15% level) is slightly lower than the reduced 10%
level reflected in this Report primarily due to the lower affordable housing funding gap requirements in the
City, which result from a combination of lower cost building types, lower land costs, and no prevailing
wage impacts.
d
R"IG
42
38
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
City of Santa Monica
Non - Residential Linkage Fees for California Jurisdictions - Table 5 -5
Santa Monica Linkage Fee Analysis
Jurisdiction
Population' Region
Year Adopted
Office Feet
Retail Feet
Blended Feet
Berkeley3
115,716 Bay Area
1993
n/a
n/a
$4.00
Culver City,
39,210 Southern California
n/a
None
None
None
Cupertino'
59,620 Bay Area
1993
n/a
n/a
$5.56
Hollywood (City of Los Angeles)0
3,863,839 Southern California
n/a
None
None
None
Oakland'
399,326 Bay Area
2002
n/a
No
$4.74
Palo Alto
66,368 Bay Area
1984
n/a
n/a
$18.44
Pasadena'
140,020 Southern California
n/a
None
None
None
Pleasanton
71,871 Northern California
Unknown
n/a
No
$2.83
San Diego (City)0. 0
1,326,238 Southern California
1990
$1.06
$0.64
n/a
San Francisco (City & County)'°•"
825,811 Bay Area
1996
$22.83
$21.30
n/a
San Luis Obispo (County) 12
272,177 Coastal California
2008
$2.25
$3.24
None
Santa Barbara
89,681 Coastal California
n/a
None
None
None
Sonoma (County)"
490,423 Northern California
2005
$2.40
$4.15
None
Walnut Creek 14
65,684 Bay Area
2005
n/a
n/a
$5.00
West Hollywood's
34,853 Southern California
1986
n/a
n/a
$2.85
' Population projections from California Department of Finance as of January 1, 2013.
$ /square foot of new development.
' Fee by land use. Industrial - $2.00. 7,500 square -foot threshold.
4 City staff indicated there is currently no discussion regarding the adoption of a fee.
5 Fees by land use. Office /Industrial /Hotel /Retail /R &D - $5.56, Planned Industrial Park - $2.79.
0 Under review.
r 25,000 square -foot exemption.
8 Certain uses exempt, including churches, colleges and universities, commercial recreation, hospitals and convalescent facilities, private
clubs, lodges, fraternal organizations, private educational facilities, retail uses smaller than 1,500 square feet, hazardous materials
storage, and on site childcare.
B Fees by land use. Hotel - $0.64, Research & Development - $0.80, Manufacturing - $0.64, Warehouse - $0.27.
10 Fees by land use. Entertainment - $21.30, Hotel - $17, 10, PDR- $17,95, R &D- $15.21, Small Enterprise/Workspace- $17.95.
11 25,000 square -foot threshold.
12 Fees by land use. Hotel - $3.40, Industrial - $1.35, Commercial Greenhouses - $0.07, Other Non - Residential - $2.97.
" Fees by land use. Commercial Hotels - $2.40, Industrial /warehousing /agricultural processing - $2.48, excludes first 2,000 square feet
of building floor area.
14 1,000 square -foot exemption.
"10,000 square -foot threshold.
Sources: California Department of Finance, City fee schedules, and phone calls with jurisdictions conducted in July 2013.
( ",
,i/ G
.�
43
39
ATTACHMENTS
COMMERCIAL NEXUS STUDY AND LINKAGE ME ANALYSIS
of Santa Monica
40
44
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
Attachment 1: Occupational Categories and Wage Data
® I G
City of Santa Monica
41
COMMERCIAL NEWS STUDY AND LINKAGE FEE ANALYSIS
City of Santa Monica
OEB 0ccupalio9 Celagmles W ith CEDD Wage Data for Los Alnjole9 -Long Beach- Glendal0 Metropolitan Division
213,120:
6mtta Mamm Non - Residential Nexus Study
Chief E.cusideas
el.no
19%
$213,400
Trial
%of Employees in Specific
31.3%
$130,060
Employeesln-
Oxupations of Each Major
Mean Annual
OES Occupation Category
MSH
Category
Wage
All Occupaustas -
'. 3.871,190
.
$52,130
Ma Occupations
213,120
%nagement
5b
$122,930
Business and Financial Operations Occti,mions
210,760
5.4%
$74,910
Computer antl Mathematical Occupations
95,740
25 °.
$84,710
Architecture and Enlinooring Occupations
71,400
1.8%
$01,630
Life, Physlcal, mid Social Science Occupations
33,220
0.9%
$75,830
Community and Social Service Occupations
63,000
1.6°4
$50,790
Legd Ocmpaiens
311,440
1.0%
$424,160
Education, Training, and Library Occupations
235,550
6.1%
$59,360
Arts, Design. Enterlainnlent, Sports, slid Media Occupations
143,960
3.7%
$87,920
Healthcare Practitioners and Technical Occupations
199,510
5.2e
$85,170
Heathcare Support Occupations
99,780
26%
$30,710
Protective Bartle. Occupations
100,600
28%
$49,370
Food Preparation and Serving Related Occupations
336,370
&7%
$21,750
Building and Grounds Chiming and Maintenance Occupations
102,110
26%
$26,660
Personal Care mid Service Occupations
BB,320
23%
$27,690
Sales and Related Occupations
398,300
10.3%
$49,446
Office and AdMnlstrativa Support Occupations
696,120
18.0%
$37,530
Fanning, Fishing, and Emmet, Occupations
2,840
0.1%
$26,9Bo
Construction end Extraction Occupations
89,830
23%
$54,090
Instdlalioq Maintenance, end Repair Oes.'atims%
116,370
3.0%
$48,490
Production Occupations
249,130
6.4%
$31,890
Transportation and Material Moving Occupameas
277,830
7.2%
$33,710
Management Occupdi0pp
213,120:
<:$122,930
Chief E.cusideas
el.no
19%
$213,400
General unit Operations Managers
86,860
31.3%
$130,060
Legidators
320
02%
$59,070
Advedising and Promdims Managers
1,480
07% -
$138,040
Mediating Managers
7,620
16%
$134,190
Sales Managers
181150
7.6%
$125,450
Public Retailers and Fmdraising Managers
2,090
1.0%
$119,200
Administrative Services Managers
8,770
4.1%
$99,500
Computer and Information Systems Managers
8,880
4.2%
$130,430
Financial Managers
10,450
9.1%
$143,050
Industrial Production Managers
4,820
23%
$1W620
Purchasing Managers
2.220
1.0%
$117.040
Transportation, Storage, and OiAdbution Managers
3,640
13%
$87,720
Compensation and Benefits Managers
610
03%
$113,920
Human Resources Managers
3.430
1.6%
$116.730
Training and Oevelopmenl Managers
700
0.3%
$114,640
Conalmc0on Mmagers
4,460
2t%
$105,110
Emicifon Adminmthinrs, Preselect and Childcare CentalPm gram
1,690
08%
$571890
Education Administra tors, Elementary and Secondary School
5,430
25%
$103.170
Education Administrdors, Poclsecandmy
3,470
1.8%
$98,680
Education Adminhsualors, All Other
940
0.4%
597.210
Architectural and Engineering Managers
6,720
12%
$150,580
Food Service Managers
6,910
32%
$51,440
Fuperal Sormse Managers
130
0.1%
$98,870
Lodging Managers
810
0.4%
$57,660
Medical and Health SeNces Managers
7,160
3.4%
$112,130
Natural Sciences Managers
870
0.4%
$150,x20
Po9masters and Mail SUpeddentlen(s
80
00°.
$89,89$
Property, Real Ealms, and Community Association Manrgere
8,830
32%
$73,940
Sodol and Ccomuuly Service Managers
3.840
i.8%
$73,560
Emergency Management Direclas
120
01%
$109,150
Managers,A110ther
8,480
4.11%
$121,570
Business aid Financial operation. Occupation.
- 210,700
$74,810
Agents and Basiness Managersaf Adble, Performers, and Athletes
3,230
1.5%
$722,030
Buyers and Puehasing Agents. Farm Reenacts
220
0.1%
$71.310
Whdesahe and Retail Buyers, Except Fami Products
5,050
2414
$52,970
Purrhasing Agents Excepl V✓ndesale, Retail, and From Pmduds
9,110
4.3%
$84,200
Clalms Adjusters, Examiners, and lnveslMJal.
8,320
39%
$63,520
Insurance Appraisers, Auto Damage
220
0.1%
$56,040
Compliance Officers
7,220
3.4%
$71,780
Cost EStimstas
4,310
20%
$66.110
Human Resources Specialists
11.640
&5%
$67,060
Labor Retailers Spedallets
2,990
1.4%
$63,040
Logisticians
3,030
1.4%
$82,170
64ana9ement Analysts
10,270
7.7%
$87,750
Meeting. Conversion. and Event Planners
1.840
09%
553,030
Pomerania.
7,350
0.6%
$63.200
Compensation, Benefits, and JOB Analysis Specialists
3,180
1.5%
563,670
Training and Devalopment Specifsts
4,680
22%
$64,390
Martel Research Analysts and Marketing Specialists
16,990
&1%
$67,210
Business Operations Specialists, All Other
3(L080
14.3%
$74.410
0- ® �.)CG
.r v
46
42
C®MMfuRCOL. NEXUS STUDY AND LINKAGE r E ANALYSIS
of Santa Monica
Accounlonts and Audilore
41,240
1&6%
$15,530
Apprelcurs and ASSeswm of Real ESOte
1,080
0.5%
$76,240
Budge) Analysts
2,600
1,3%
$76.150
Credit Analysts
1,700
06%
$73,590
Financial AmAyds
9,010
4.37.
$107,260
Personal Financial Advisors
5,750
Z7Ne
582,130
Insurance Ueiguenrace
2,460
1.2%
$71,640
Finandal Examiners
910
0.4%
$77,520
Credit Counselors
800
014%
$45,820
Loan Officers
6,600
3.1%
$90,510
Tax Examinemmal Gmledo.. and Rovenuo Agents
1,570
01%
S74,47D
Tax Preparers
1,990
0.9%
543,430
Finandal Specialists, All Other
5,280
25%
$65,220
Computer and Mathematical Occupations
'95,740
:$84,710
Computer and Information Reacerch 5aienlisfs
0
00%
$117,580
Computer Systems Analysts
12,480
13.0%
$01.55D
Information Secunly Analysts
1,330
1.4%
$90,520
Computer Programmers
0,350
9.8%
583,430
Software Developers, Applications
15,670
16.4%
593,270
Software Developers, System s Software
13.280
13.9%
$113,080
Web Devdcgers
4,210
4.4°4
$63,430
Oalabase Adminislunces
2,320
Z4%
- $96,470
Network and Computer Systems Adonletralas
0,600
10.1%
$80,460
Computer Newwork Architects
4,260
4.4 °4
$90,500
Cempuler User Support Speciallds
13,340
13191/.
$51.550
Computer NeMnrk Supped Specialists
3,560
3.7%
$86,270
Computer Occupations, All Other
2,770
Z9%
$73,880
Actuaries
380
0.4%
$80,820
Mathematicians
260
0.3 °A
$100,050
Operators Research Analysts
1,380
1.4%
$86,260
SUAisildans
520
05%
$81,010
Ardillactre and Engineering Occupations
71,400''
`:$01,630
Architects. Except Landscape and Naval
3,050
4.3%
$91,040
Landscape Architects
280
0.4%
$76,810
Cadographere and Phologrammebisis
180
03%
$75,240
Sn.ycre
520
07%
$84,510
Aerospace Engineers
9,210
12,9%
$118,070
Bleard&.l Engineers
540
0.8%
$69,240
Meanest Engineers
880
09%
$101,080
Gvil Engineers
6,660
93%
$92,030
Computer Hardwam Engineers
1230
1.9%
$113,460
Electrical Engineers
5,890
S0%
$104,750
Elect.la Engineers, Except Computer
0,040
8.5%
$100,370
EndrenmeMal Engineers
1,100
L5%
S97,170
Health and Safety Engineers, Except Mining Safely Engineers and inspectors
570
08%
$92,580
Indusldal Engineem
5,440
7.6%
$96,490
Materials Engineem
1,240
1.7%
$102,780
Mechanical Engineers
0,200
88%
$92,720
Mining and Geological Engineers, Including Mining Safety Engineers
0
0.0%
$98,560
Petroleum Engineers
490
07%
$105,300
_
England ,Ail Other
2,760
30%
$94,120
Architectural and Chll Drafters
2,550
36%
$57,580
Eleclncal and Electronics Drafters
1,340
1.9%
$56,190
Mechanical grafters
1,150
1.6%
$53,980
Evaflere.All Olhor
640
0.9%
$52.310
Aerospace Engineering and Operatiens Technicians
830
1.2 °4
$67,070
Cnil Engineering Technicians
1,250
1.8%
$62,200
El,rnwel and Eleclsnias Engineers, Technidans
4,450
6.2%
$65,240
Electa,hachanical Technicians
220
0.3%
$54,800
Emunme ental Engineering Technicians
710
L0%
861,710
Industrial Engineering Technidans
1,100
1.6%
$61,330
Mechanical Engineering Technicians
870
1.2%
$57,860
Engineering Technidans, Except prepare, All Otter
1,520
Z1%
$67,350
Surveying and Mapping Technicians
320
0.4%
$68,620
Life, Physical. and Social Science Occupations
'- 33,220
/- $75,830
Food SdenOSts and TechneiogNts
440
1.3%
$60,150
Biochemists and Biophyddsts
1,010
309g,
587,900
Mkrabidagids
510
1.5%
$70,590
Zodogisls and Wldife eldegioo
0
0.0%
$77,590
Biological Scientists, All Other
0
00%
$74,830
Conservation SdeNlsls
90
03%
$81,190
Foresters
60
02%
$52,300
Epidemidogisis
0
0.0%
556,250
Medlcai Scientists, Except Epid midogics
5,000
15.1%
$91,130
Lire Sdentisis, All Other
140
0.4%
$71,360
Astranomere
290
09%
$105,590
Phyddsts
1,050
3.2%
$94,770
Atmospheicand Space Sdentisis
0
0(%
$100,270
Chemists
2,160
OS%
$08,940
Materials Scientists
350
1.1%
$85,620
EgAropmental Scientists and Spedalids, Including Health
1,620
4.9%
$79,760
Geondent ^,Is, Except Hydratoglds and Geographers
860
Z6%
$100,270
, Y)ws('
-11,
47
43
COMMERCIAL NEXUS STUDY AND LINKAGE FEE/ -M'I -I YSIS
of Santa Monica
Hydrologists
0
aWA
5102,090
Physical Scientists, All Other
130
(14%
$102,990
Economists
780
23%
$116.140
Survey Researchers
420
L3%
$67,920
Clinical, Counseling, and School Psychdagista
5.830
17.5%
S70,330
Psyda4ogias, Al Other
190
O6%
$81,050
ddoa
Sp gid
210
0.6%
503,160
Urban and Regional Planners
Lg90
0.0%
$78,930
Anthropologists and Archeologists
70
02%
$60,760
Hislodans
0
0.0%
$78,980
Send ScienliSS and Related WorNem, All Other
11130
34%
$95,130
Agricultural and Food Science Technicians
450
1.4%
$31,210
gidpgioal Technlcians
L420
4.3%
$46,850
Chemical Technicians
1,240
33%
$44,020
Gevb9ical ad Peboleum Technicians
140
0.4%
$58,880
SOdal Sdence Research Assistants
610
1.8%
$49,350
Enoronm enlalSilence and Prdaction Technicians, Including Health
270
0.8%
$51,250
Palencia Sdence Technicians
520
1.6%
$79,220
Forest and Conservation Technicians
550
V%
340,650
His, Physical. and Social Science Technicians, All Other
1.430
14%
$49,030
Community and Social Servtca Occupations
-' 63,000
sl$50,790
Substance Abase and Behavioral Usorder Counselors
2,830
4.5 °b
330,920
Educational, Guldenw, School, and Vocational Counselors
0,480
15.0%
$70,080
Marriage and Family Therapists
2,280
3.0%
$40.190
FAenIM Health Counselors
2370
38%
$49,310
Rehabifindien Counselors
2,880
4.6%
$35,940
Coensakne,AllOther
1,190
1.8%
$39,410
Child. Faulty, and ScOool Social Workers
8,780
13.0%
551,260
Healthcare Social Workers
$220
5.1%
$61,800
idenlat Health and Substance Abuse Social Workers
3210
6.1%
$51,010
Sodel Wakers,Ail Other
3,590
5]%
$61590
Healh Educators
1Sao
24%
$47,450
Probation OfOcersand Correctional Treatment Specialists
4,020
G.4%
$70,850
Sochi and Human Service Assistants -
12,220
19.4%
$34,350
Community Heald Workers
Lila
1.8%
$40,740
Community and Social Seance Specialists, All Other
2,680
4.3%
$40,500
Clergy
11100
1_7%
S60,270
Wedaro, R.Harus AclMlies and Etlucog.
470
117%
$52,010
Religious Workers, All Other
130
0.21e
$35,900
Legal Occupations -
':38,440 `'
$124,150
Lavyer¢
23,130
60.2%
$152,210
Judicial Law Clerks
840
22%
$65,210
Administrative Law Judges.Adludlcalas, and Heamlg Officam
590
1.5%
$91,320
Arbarmors, Mediabrs,and Conciliators
650
1.7%
$120,960
Judges, Magistrate Judges, and Magistrates
440
1.1%
$168,090
Paralegma and Legal Assislanls
8,000
20.8%
$59,610
Coed Report.
920
24%
$74,030
Tdre Examiners, Absladas, and Searchers
"To
39 %
$52,710
Legal Suppot Workers, All Other
2,380
82%
$57,61)0
Educatlon, Tiaining said Library Occupations
' .235,550
'.. $59,360
guidance Teachers, Postsecondary
1.840
0.8%
$109,270
Campuler Sdence Teachers, P.alsewndary
1,110
0.6%
$107,700
kialhemalical Science Teachers , Postsecondary
1,660
07%
$108,680
Archlledure Teachers, Postsecondary
130
'11%
$86.120
Engin¢¢rng Teachers, Postsecondary
940
0.4%
$121,590
Agricultural Sciencec Teachers ,Poslsacendary
60
0.0%
$0
gicandral Science Teachers ,Postsecondary
880
04%
3108,080
Atmospheric. Earth. Manna, antl Space Sd¢Ows Teachers. Postsecondary
690
03%
$122.000
Chemistry Teachers, Postsecondary
420
02%
5113880
Environmental Science Teachers. Postsecondary
40
0.0 -4
$122120
Phydcs Teachers, Poslsecon ory
370
0.2%
$113,310
Anthropologyand ArcheoiogyTeachero Paststtondary
160
0.1%
$98,690
Area, Ethnic. and Cultural Sludies TeacL¢rs. Postsecondary
260
(11%
$88.740
Economics Teacher% Postsecondary
260
0.1%
$121.600
Geography Teachers, Postsewndary
60
00%
$102,790
Po5lical Science Teachers ,Poslsacendary
300
0.1%
387,940
Psychology Teachers, Postsecondary
1,100
OS%
$94,470
Soddegy Teachers, Pastsecmdary
260
0.1%
$103,620
Social Sciences Teachers. Postsecondary, All Other
630
0.3%
$134.830
Health Spedadles Teacher% Postsecondary
2,520
LI%
$98,770
Nursing lnslrudas and Teachers, Pastse¢wda y
820
03%
$98,680
Education Teachera, Postsecondary
1,240
0514
$73,780
Library Sciance Teachers, Paslsecondary
70
00%
$97,100
Cominal Justice and law Enforcemanf Teacher, Peslseccadary
140
0.1%
$67,040
Law Teachers, Postsecondary
190
0.1%
$158,560
Social Work Teachers, Poslsacendary
0
00%
593,460
Art, Omma, and M05icTeachms. Paslsecmdary
4,620
20%
$93,530
Communlcellons Teachers, Postsecadary
940
(14%
$108,510
English Language and Ltletalure Teachers, P.Aceeondary
L840
(18%
5707,120
Foreign Language and Ldealare Teachers, Postsecondary
1,310
06%
$78,640
History Teachers, Pasteaccedary
420
02%
$105,930
Phdoeophy and Religion Teachers , Postsecondary
470
02%
$90,020
48
44
COMMERCIAL NEXUS STUDY AND LINKAGE FEE MaALYSIS
of Santa Monica
Graduate Teaching Assistants
2550
1,1%
543,470
Home Economics Teaches, Postsecondary
130
0.1%
$100,350
Recreation and Fitness Studies Teadlers, Postsecondary
650
0.3%
$07,070
Vacelional Education Teachers, Posisecondary
3,220
1.4%
$73,030
Postsecondary Teachers, All Other
8,830
37%
S73,230
Preschool Teachers, Except Special Education
11,040
4.9%
$33,070
Kindergarten Teochero, Except Epeclol Educallon
3.570
1.5%
585,080
Elementary School Teachers, Except Special Education
33,700
14.3%
$72,230
MWdie School Teacher; Except Spedal and Caree.Rechnical Educalim
10,470
4.4%
$67,460
Career7TechNcol Education Teachers, Urals Schod
0
00%
$60,180
Secondary School Teachers, Except Special and CamerRechnleal Eduwlion
25.800
11.0%
$67,810
Camex77echniwl Educalion Teachers, Secondary School
910
0.4%
570,790
Special Eduwlion Teachers, Preschool
690
0.3%
$51,330
Special Education Terelers, Kindergarten and Elementary School
2,730
1.2%
$07,720
Special Education Teachers, Middle School
1.040
0.4%
$61,920
Spedal Education Teachers, Secondary School
4,260
18%
$66,630
Speelal Education Teachers, All Other
0
0.0%
$49,200
Adult eaeic and Secondary Educalim and GleracyTeaMers and Instructors
2,510
1.1%
$71,000
Set Enrichment Educalim Teachers
3,940
11%
$41,080
Subsigule Teachers
20.860
89%
546,440
Teaolims and instructors. All Other, Except Sunshine Teachers
12.260
6.2%
550,860
Archidcs
360
02%
$43,400
Curators
340
0.1%
$69,200
Museum Technicians and Conservators
370
02%
$48,410
Limanans
2.470
1.0%
$69.620
Library Technidans
1.860
0.811/1
$40,860
AudioNSUal and WItimedia CClectlons5pedal'WS
330
0.1%
$43,760
Insimdorml Coordinators
$,too
22%
$72,360
Teacher Assistants
35.070
14.0%
$28,660
Educallon. Tialning, and Library WoAars, All Other
0
0.0%
$29,640
Ads, Design, Warainmenp Sports. and Media Occupations
143,960`
.'.$87,920
Ad Directors
2,830
20%
$118,590
Craft Adics
400
0.3%
$61.70D
Fine Artists, Including Painters, Sculptors, and Illustrators
3,080
2.1%
$07,600
8 niumuia Artists antl Ardmaters
5, 730
4.0%
$89,660
Adisls and Related Workers, All Other
no
02%
$58,580
Commerdai and iard.,i i it Designers
1,290
09%
$57,130
Fireman Decliners
3.200
22%
$72,420
Floral Designers
650
0.5%
$29,420
Graphic Designers
9.260
04%
$57,020
Inledor Designers
1,820
1.3%
$62,300
Merchandise Olsplayem and Winos/ Trammed
1,490
I.M.
$33,170
Set and Exhibit Designem
1370
1.0%
$63,750
Designers. Al Other
770
0.5%
$54,600
Producers and Directors
19,570
138%
$137,560
Athletes and Sports COmpelitors
0
0.0%
$12B,180
Coaches antl Boards
5,490
3816
$47.000
Umpires, Referees, and Other Spells Officials
460
OSIA
$25,100
Danvers
860
R6%
$D
Music Direclos and Composers
400
03%
508,930
MdStdiene and Singers
2.670
1.9%
s0
Enledeiners and Pedernales, Spuds and Related Workers All Other
1,350
0.0%
50
Radio and TeleNSion Announcers
910
06%
$72,710
Public Address System and Other Announcers
400
03%
$74,840
Reporters and Corespondents
1,450
1.0%
$52,400
Public Relations Specialists
7.800
5.4%
$76,250
lid ors
4.100
28%
$60,810
Technical Writers
WO
0.7%
$76,600
Writers and Authors
4.160
2.9%
$119,530
Interpreters and Transiadrcs
2,160
1.5%
$02590
Media and COmmunlcalion Workers, Ali Other
6.200
4.3%
$65,830
Audio and Video Equipment Technicians
3,940
2.7%
$54,770
Broadwsl Technicans
4,160
29%
549,460
Sound Engineering Technicians
2,470
1.>%
$7271D
PhdeOraphers
1,680
1.2'6
$59,650
Sperm Operators, Telouran, Video, and Motion Picture
1,700
1.2%
$76,120
Film and Video Editors
4, 760
33%
$95,550
Media and Communication Equipnrent Workers, All Other
3,020
2.1%
$72,630
RoaOheere Practitioners and Technical Occupations -
'199,510
<$85,170
Chiropractors
710
0.4%
$06,140
Den9ste. Gee.t
3,420
I. >%
$120,710
Orel and Maxilbfacial Surgeons
0
00%
5153,410
Orthodontists
0
0016
$240,270
Den9ds, All Other Specaliss
80
00%
$152,460
Chatham, and Nuhi$unlds
1,740
09%
$65,570
Cplomtldsls
980
05%
$102,940
Phnrmacieds
6?50
31%
$121,900
Aneslhesldr,isls
0
00%
17
Family and Gmerai Praditioners
3200
1.011.
$190,200
Inlernisls, General
1,400
OJ%
$204,610
Obstedrians and Gynecologists
450
02%
523%450
Pediatricians, General
1,240
06%
$187,450
Psyeldalrlsls
0
00%
$174,150
45
(/ R6 G
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Surgeons
1,210
a6%
5220,480
Physicians and Surgeons, Ad Other
7,740
39%
$197,030
Physidam Assistants
1,680
0.8%
$105,720
Podiatrists
260
at%
$81,310
Ocaupallonol Therapists
2,490
1.2%
589,890
Physical Therapists
4,880
24%
$88,430
Radiation Therapists
370
02%
$04,200
Recleatbnal Ther,loa
no
02%
$59,970
Respiratory Thmausts
4,780
249A
$68,890
Speechionguage Pathologists
2 ,550
1.3%
$83,450
Exercise Physiologisin
0
0.0%
$59,340
Therepide, All Other
910
05%
$40,090
Veterinarians
880
0.4%
$111,470
Regislered Nurses
69,540
34.9%
$88,990
Nurse Anesthcisls
270
0.1%
$172,310
Nuomli icivdves
60
00%
$129,760
Nose Practilianars
2.370
1.2%
$89,500
Auddorjsls
010
0.3%
$77,040
Health Diagnosing and Treating Purnmilioners, All Other
840
0.4%
562,410
Medical and Clinical Laboratory TechrNlc 4s
2.980
1.5%
$74,500
Medical and Clinical Laboratory Technicians
5.730
29'k
$39,050
Dental Hygienists
4,780
24%
$98,750
Cmdiovmsalar Technale,hs and Technicians
1,120
0.6%
$57,500
Dagnosllo Medical SOnographers
1,180
O.G%
$75,460
Nuclear Medrdne Technologists
410
02%
$Dl.640
Radiologist Technologists
4,160
21%
$00,430
Magnetic Resonance Imaging Technologists
450
0,2%
$04,840
Emergency Medical Technicians and Pammediw
-4,610
23%
$28,290
Detelio Tedinkians
680
0.3%
$20910
Pharmaoy Technicans
7,200
3.7%
$36,810
Psychiatric Technicians
1,700
0.0%
546,740
Resandmq Therapy Technidans
240
al%
$49,560
Surgical Technologists
20510
1.51
$51,000
Velednary TeolndegistS and Teftidans
1)550
0.8%
$37,200
Ophlhaimtc fAeQaal Technicians
510
0.3%
$36,090
Licensed Padlcal and Licensed Vocational Nurses
19,700
9.9%
$50,300,
Medical Records and Health inform each Technicians
4,990
25%
$39,900
Oplldons, Dispensing
1,900
1,0%
$34,060
Ortudists and Pholb. ft,
0
0.0%
$72,120
Hearing Ald Specialms
390
0.2%
$50,970
Health Te.Irmas ids and Tachnidans, Ail Other
4,080
20%
$42,490
Ocmrp Ummul Health and Safety Specloiisis
1,760
a9%
570,980
Occupational Health and Safely Terhnlchus,
180
0.1%
$48,600
AlhlsOa Trainer
260
0.1%
$50,300
Heahhcare Practilonets and Technical Workers, All Other
11400
0.7%
$6,3560
Healthcare Support Occupations
99,780''
$30,718
Home HealN Aides
14,020
14.1%
$24.070
PsyolrerrAides
570
0.0%
$27,480
Nursing Assistants
31,710
31.8%
$27,640
Ordedee
1,550
1.6%
$29,180
Occupational TherupyAsslshmb
350
0.4%
$64.000
Ocwpalional ThampyAldes
190
0.2%
$33,630
Physical Therapist AsdstaMS
1.180
L2%
$50,900
Physical Therapist Aides
1,400
1.515
$20,440
Massage Therapists
2,190
22%
$35,310
Dental Assistants
10.340
10.4%
$35.050
Medical Aestchuls
22,670
22.7%
$33,200
Medical Equipment Reamers
1,720
1.7%
$32,230
MedirelTrenscriplionkto
1,350
1.4%
S48 .730
PharmaoyAldes
2.450
25%
$23.020
Veterinary Assisants and Laboratory Animal Careakers
1.580
105%
520.370
Phlebotomists
3,180
3.2%
$38,180
Healthcare Support Worker, All Other
3280
33%
$35,270
Protective SerNce Occupdmns
100,500 '
"$10,370
First -Line SapeMsos el Ceneclienal Officers
140
0.1%
S87,230
First-Line Supervisors of Palms and Detectives
900
0.8%
$133,390
First4Jne Supervisors of Fire Fighting and Prevention Workers
300
113%
$452,770
Find -Line SupeMs or s of Prolechre SeMce Workers, A9 Other
2.400
22%
$48,430
Firefi9hlers
7,150
6.5%
$83,290
Fire Institution; and lnvesfiealore
210
0.2%
$93.110
Cormdlonal Officers and Jaaao
3,780
15%
$56,130
Daledives and criminal invedigalors
3,090
2.8%
$tal,760
Parking Enforcement Workers
340
a3%
543,480
P.M. and Sheriff's Patrol ORlcare
24,590
22.5%
$84,810
Animal Control Workers
260
02%
$48,040
Pinale Detectives and lnvesggalors
800
03%
$63,310
Gaming Samsfitance Officers and Gaming Investigators
120
0.1%
533,500
Searity Guards
51.950
47.4%
$26.220
Crossing guards
0
0.012.
$23,740
Weguads, Ski Palyd, and Other Reaeallonal PrdedNa Sevice Workers
3,560
13%
$30,700
Tram,am a can Seeudly Screamers
2,750
25%
$38,010
Protective Samoa Workers, Ali Other
3,580
3.3%
536,880
. r,SG
PLO
46
COMMERCIAL A L NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Food Preparation mid 8ervliig Related Occupations ' .
1336,370
'$21,750
Chefs and Head Cooks
2,820
0.8%
$47,520
Fire ine Supervisors of Food Preparation and Sii Workers
22,350
0.6%
$30.430
Cooks, FmA Food
30,]]0
AM
$18080
Cooks, Insfilulion antl Cafeteria
5,260
1.6%
$28,540
Cooks, Resonant
28,600
7.9%
$23,100
Cooks, Shari Order
3.090
a9A
523,700
Cooks, An Other
810
02%
$28,070
Food Preparation Workers
31,670
9.4%
$19,730
Badanders
12,23D
3.6%
$22,970
Combined Food Prepaation and SeMng Workers, Including Fast Food
77,360
23.0%
$20,040
Counter Allendonls Golden, Food Concession, and Coffee Shop
19,140
3066
$21,430
VJa3ers and Waitresses
04,290
19.1%
$21,030
Food Servers, 14muszlaurest
5,590
1.6%
525,500
Nair, Room and Cafeteria Allendanlsand Badender Helper.
17,000
5.1%
520,180
Dishoashers
16,850
50%
$19,250
Hosts and Hosieeses. Restaurant. Lounge, and Coffee Shop
8,410
26%
$19.990
Food Prmpaa6on and Serving Related Workers, Al Other
1,480
04%
$20,150
9u11dmg and Grounds Cleanln0 and Maintenance Occupations
102,110
-: $26,660
Find -Line SupeMsors of Housekeeping and Janllodal Workers
3.660
3.5%
$41.260
Fird-Linm SupoName of Landscaping, Lavin Service, and Greundskesping Workers
1,370
1.3%
$49,000
Janitors and Cleaners, Except Maids and Housekeeping Cleaners
53410
52.3%
$25,750
Maids and Housekeeping Cleaners
20,700
203%
$22,870
Building Cleaning Worker,, A0 Other
100
01%
$2TOW
Peel Cenird W.Ria,
2230
22%
$31,120
Landscaping and Groundskeeping Workers
19,090
107%
$27,880
Peslidde Hungers, Sprayers, and Applicators, Vegetation
120
0.1%
$35,740
Tree Tritimerrs and Palms.
1.310
1.3%
533.620
Grounds Maintenance Workers, All Other
0
Bv/.
$28,140
Penconal Care mid Service Occupallm¢
118,320 `/:
)$27,890,
Gaming Sups"ems
500
0.6%
$41,83(1
First -Line Samerd ears 0 Personal Sendce, Workers
3,5al
4.0%
$45.100
AnenalTralners
400
0.6%
$40,200
Replaced Animal Caretakers
4,080
4.6%
$23,270
Sanding Bealem
31030
3.4%
$0
Burning and Sports Book Walms and Runners
210
02°/
$37,200
Gaming S.N. Workers. Al Other
D
00%
$28,520
Mallon Picture Protecgonisk
0
00%
$27,600
Ushers, Lobby Attendants, and Ticket Takers
5,830
6.6%
$21,560
Amuscmanl and Recreation Atendand
6,420
7.3%
$23,910
Costume Alfendand
440
0.5%
$53,160
Laker Room. Carl,... antl Dressing Room Abandanls
1,040
1.2%
$22,070
Entertainment Attendants and Related Workers. All Other
70
0.1%
$28,950
Embalmers
130
0.1%
542,740
Funeral Altendanls
380
0.4%
$28,800
Mergers, Undertakers, and Trimmed Oluclms
430
0.5%
$0
Barba'
0
0.0%
$20,700
Hairdressers, Hairaly0ds, and Cosmetologists
5,650
6.4%
$29,930
Makeup Mists, Theatrical and Pedemance
430
OS%
579,820
Manicurists and Pedicidets
3.270
37%
520,100
ShampOcera
0
Ili
$20,620
Skin ca re Specialists
1,900,
22%
$32,390
Brennan. panoramic! Bellhops
1,460
1.7%
$23,050
Concierges
GOD
07%
$29,320
Tour Guides and Escorts
380
0.4%
527,030
Trave10.1des
320
0.4%
$41,830
Childcare Worker.
15,410
17.411,
$24,150
Personal Care Aides
12,450
14.1%
521,720
Filne9s Tnaicenimed Aerobics instructors
5,790
6.G%
$47,510
Recreation Workers
0.640
10.0%
$26,400
Residential Adhsors
1,200
MR4
$34,250
Personal Care and Se lce Workers, All Other
D
00%
$26,510
Sales and Related Occupations
3911,300
` $40,440
Fka-LIne Sup.Neds at Pilot Sales Wake.
31,730
8.01k
$44.180
Fiat- l- IeSupeNcors of Him - Retail Sales Workers
6, 790
t]%
$71,170
Cashiers
85,330
21,4%
$22,530
Counter and Rental Clerks
23,620
59%
528,420
Pads Salespersons
4,410
1.1%
$33,89D
Retail Salespersons
120.620
303%
$26,650
Advedieing Sales Agents
5,510
1.4%
$74,200
Insurance Saics Agents
7,960
20%
561,140
Sec i6es, Commodities, and Financial Semsec Sales Agents
100630
27%
$112,360
Tavel Agents
3,220
01
$36,740
Sales Represenleirves, Smdces, All Other
23,770
OB%
$63,660
Sales RepresentaMes, Wholesale and Manufacturing, Technical and Seenllfic Products
Ana
237.
$112,120
Soles Repic%motel Wes, Wholesale and himmArcludr, Except Terlrnieal and Scientific Products
43,690
110%
$84,8110
Demonstrators and Product Promoters
3,110
0.8%
$29,430
Models
70
0.0%
$48,320
Real Estate Brokers
1,620
0.4%
$130,440
Real Estate Sales Agents
2,940
01%
$52,910
Sales Engineers
21110
05%
$95,640
TNemarketers
6,870
1.7%
$25,750
x3
(Gij `G
9
51
47
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
0nar-IODoor Sales Wa rs, News and street Vendors, and Related Workers
430
01%
$24,980
Sales and Related! Worker-., Al Other
4,520
1.1%
$35,680
OIOCe and Adminlslrellve Support Occupellons -
' 696,120
':$37,530
First-Line SupeMsom of Office and AdminlatmWe Support Waders
48,590
TOO,
558,110
SWilchboard Operators, Including Anw,ming Service
3,850
06ar.
$29,590
Telephone Operators
910
01%
538,790
Co mmonlcaliche Equipment Operators, All Other
90
0.0%
$29,180
Bill and Acceml Called...
14,060
2.0%
$40.500
Billing and P6,uing Clerks
15,830
Z3%
$36,960
8odtkeeping, Accanfing, and Auction Clerks
49,980
7.2%
$40,47D
Gaming Cage Workers
450
01%
$28,300
P.yrdl and Timekeeping Clerks
5,250
08%
$43,720
Procurement Clerks
2,160
03%
$38,390
Teners
14,650
21%
$26,530
Financial Clerks, All "her
1,610
02%
$41,040
Brokerage Clerks
1,080
0.2%
$50,610
Correspondence Clerks
850
0.1%
$40,700
Court, Municipal, and License Clerks
2,270
03%
544.720
Credit Authorizers. Checkers, and Clerks
880
0.1^G
$40,650
Customer Sedee Representatives
66,710
8.1%
$37,600
Eligibility Interviewers, Government Programs
0,710
1.0%
$41,830
File Clerks
0,140
OD%
S30,670
Hotel, Motel, and Resort Desk Clerks
4,000
06%
$23,510
InleMewers. Except Eligibility and Loan
7080
1.1%
537,400
Lill Assistants, Clerical
200
0.404
$27,160
Loan lnlaMewers and Clerks
3,590
05%
$47,060
New Accounts Clerks
1A20
0.7%
536,090
Order Clerks
9,890
1.4%
533,180
Human Resources Assistants, Except Pagdl and Timekeeping
3,700
0.5%
$43.270
Receptionists and information Clerks
27,080
3.0%
$28,630
Reservation and Transportation Ticket Agents and Travel Clerks
5,770
08%
$35,660
infomration and Record Clerks, All Other
4,200
O61k
$40,550
Cargo and Freight Agents
7,130
1.0%
$42.770
Couriers and Massengale
4,020
O.N.
$27,730
P.5ce, Fire, and Ambulance Dispatch...
840
at%
$51,290
dispatchers, Except Polk., Fire, and Ambulance
5,690
0.8%
$39,290
Miler Reader %Willies
1,050
02%
$46,540
Panel Samoa Clerks
1,790
03%
$51,540
Postal SeMce Mail Carders
8,620
1.2%
$55,610
Portal SeMce Mai Sorters, Process ors, and Processing Machine Operators
5,150
07%
$50,290
Production, Planning, and Experitlng Clerks
13,040
1.9%
$48,880
Shipping, Reachhur, and Traffic Clerks
31,410
4s14
$29,640
Small Clerks and Order Fillers
57,050
82%
525,070
Weighers, Measurers, Checkers, and Samplers, Recordoorchg
3,360
0.5%
$27,100
Executive Secretaries and Executive Administrim. Assistants
30,470
4.4%
$56,370
Legal Secretarles
9,500
1.4%
$52,600
Madlealsociabries
18,510
23%
$361390
Secretaries pnd Adminlslralise Assistants, Except Legal, Medical, and Executive
54,040
7.8%
$37,640
Computer Operators
1,850
0.3 %
$41,020
Dal. Entry Keyers
6,940
I.0%
$31,000
Word Processors and Typists
11210
1.6%
$40,450
Decide, Pubichane
360
DA%
542,050
Insurance Claims and Policy Processing Clerks
0,320
0.0%
$39,210
Mail Clerks and Mad Machine Operators, Except Postal Service
2,330
03%
$30,060
Office Calks, General
92,100
132%
$30,430
Office Machine Op status. Except Computer
2.800
0.4%
532.650
Proofreaders and Copy Markers
280
0.0 °h
$47,860
Statistical Awtoonls
270
0.0%
$43,790
Office and Administrative Support Workers, All Other
17,110
25%
$27,310
Fropo liq; Fishing, and Foeslry.Occupations
-2,840
$26,990
First- Line $upeMsote of Forming, Fishing, and Forestry Workers
170
6.0%
$62,490
Agdcullural inspectors
280
9.9%
$50,930
Graders and Seders, Agricultural Products
150
5.3%
$21,410
Farmworkers and Laborers, Crop. Nursery. and Greenhouse
1.760
61.6%
520.600
Farmworkers, Farm, Ranch, and Aquactllural Animals
270
0.5%
$28,020
Constipation and Extraction Occupations
89,830'
r($Sd'mdd
First -Line SupeMsors of Con stmo6on Trades and Extraction Workers
7.330
8.2%
$74,570
B.formakers
110
0.1%
$69,880
Btldlm awns and Blecomitsons
430
0.61/1
$61,620
Stonemasons
180
03%
$42,670
Carpenters
10,680
it
552,040
Carpet Installers
730
0.8%
543,730
Floor Layers, Except Comm. Wood, end Hard Tiles
0
00%
$50,570
Floor Sanders and Finishers
0
00%
$38,000
Tile antl Marble Sellers
4imia
fP%
$40,460
Cement Masons and Concrete Finshisrs
2,050
2.3%
546,890
Termaze Workers and Finishers
370
0.4%
$42.140
Construction Laborers _
17,890
19.9%
$42,140
Pakng, Surfzdr, , and Tamping Entril nl Operators
400
a4%
$61,100
Opened, Engineers and Other Construction Equipment Operators
3,480
39%
$75,810
Drywall and Calling Tile installers
2,890
29%
552,570
Tapers
500
66%
553,190
RSG
62
In
COMMERCIAL NEXUS STUDY AND LINKAGE FEE AMLYSIS
of Santa Monica
Eladdislans
9,810
10.9%
$64,100
Glaziers
720
08%
$60,720
Insulation Waikato, H.,. Ceirng.and Wall
0
0.0%
$31,080
Insulation Workers, Mechanical
a
Moss
$45,920
Pointers, Ccaslrucllon and Mehhomnoe
4260
4.7%
541,910
Paperhangers
0
0.0%
$41,330
Pipeleyers
709
08%
S51,070
Plumbers, Plpefiters, and Sieam0lers
0,920
7.7%
$06,330
Plaslxers and SlumcMasons
1,500
19%
$53,670
Relafmcing Iron and Rebx,WOrka.
210
02%
$68,160
Roofers
1,890
21%
$44,130
Sheet Metal Warke,s
2.350
2.6%
$54,880
Structural iron and Sled Workers
920
I.M.
$51,390
Solar Pholwdlalo Installers
100
0.1%
$04,990
Helpers -Brickm aeons, Blackm aeons, Stonemasons, and Tile and Marble Setters
690
0.8%
$28,450
Helpers - Carpenters
500
Gi
$34,700
Helpers- Eladdit,W.
1,450
1.6%
$37,890
Helpers - Painters, Paperhangers, Mastro , and Stucco Masons
040
(17%
$36,560
Helpers- Pipelayers, Plumbers. Plpefdlers, and Gleamfillers
970
1.1%
s0
Helpers. Construction Trades, All Other
0
0.0%
$31,460
Construction and Building lnsper tors
1.680
1.9%
576.800
Elevator lustallers and Repairers
620
0.7%
$89,650
Fence Erectors
0
00%
$36,250
Hazardous Materials Removal Workers
750
0.8%
$47,160
Highway Maintenance Workers
400
0.4%
$52.090
Sepilc Tank Sumitomo and Sewer Pipe Cleaners
300
04%
$36.840
Construction and Related Workers, All Other
340
- 04%
$40,220
Derrick Opemlers, Oil and Gas
210
02%
$59,540
Rotary Othl Operators. 011 and Gas
0
00%
567,600
Service Unit Operators, Oil. Gas, and Mining
240
0.3%
$74.110
Earth D9ocre. Except 011 and Gas
0
0.0%
$61,710
Roustabouts, at and Gas
240
(13%
$46,170
Extraction Workers, All Other
0
MA
$39,760
Installatldn, Maintenance. and Repair Occupations
110,370`..
'i.$48,400.
First-time Supervsors of Mechanics, Installers, and Repairers
1D.Ma
8.0%
$71,500
Computer, Aulom ated Teller, and Office Machine R Vacate
2,900
25%
$44,520
Radio, CelWaq and Tower Equipment lnsalere and Repairers
370
03%
$56,370
Telecommunication Equipment Installers and Repairers, Except Line Installers
a19D
TWA
$55,840
ANonta Technicians
0
0.0%
$59,700
E1scldc Moles, Power Tod, and Related Repairers
410
0.4%
$54,480
Electrical and Electronics Installers and Repairers, Transpmetion Equipment
410
04%
$65,520
Elacldcai and Electronics Repairers, Commercial and Industrial Equipment
1,5311
1.3%
554,000
Elacldcal and Elsdmntre Repalrem, Paverhovse, Substation, and Relay
43D
04%
$88,50D
Eleetronlc Equipment Installers amt Repairers, Motor Vehicles
290
0.2%
$30,080
Electronic Home Entertainment Equipment Installers and Repairers
0
0.0%
$34,000
Security add Fire Alarm Systems lnstallcic
1,850
1.6%
$46,200
Alraafl Mechanics and SeMce Technicians
3,950
Sir%
$60,890
Aulomotve Body and Related Bhaatrma
2,850
24%
$40,310
Automehe Glass Installers and Repairers
230
02%
$25,840
Automotive SeMce Technicians and Mechanics
13,160
11.3%
538,740
Bus and Trud, Mechanics and Olesel Engine Specialists
4.000
42%
$53,120
Farm Equipment Mechanics and Service Technicians
130
0.1%
546,M00
Moods Heavy Equipm car Mechanic, Except Engines
2,520
22%
$58,300
Rail Car Repairers
170
0%
$45,700
Motorboat Medram. and Smviem Technideas
90
01%
$0
Motorcycle Mechanics
290
02%
$39.560
Outdoor Power Equipment and Other Small Engine Mechanics
410
0.1%
540,010
Bicycle Repairers
350
03%
$22.100
Recreational Velede SeMce Trehremes
0
00%
$49,530
Tire Repairers and Changers
two
1.6%
$32,600
Mechanical Door Repairers
0
001/6
$53.900
Control and VaiW Installers and Repairers, Except Mechanical Door
1,350
1.2%
$02.600
Heating, Air Conditioning, and Refiigersllon Mechanics and Installers
3,Ban
63%
$53,370
Home Appliance Repairers
a
00%
$34,180
Industrial Machinery Mechanics
5,430
43%
$57.630
Maintenance Workers, Machinery
2,010
V%
$40.180
1,01 rights
0
0.07.
$59,500
Electrical P..r•Line Installers and Repairers
1,360
1.2%
$85,250
Telecommunications Use Installers and Repalrem
4,170
3.6%
555,270
Came. and Phdogophic Equipment Repairers
220
02%
$51.040
Medlcal Equipment Repairers
580
0.6%
$51,000
Muskat lnstrum ant Repairers and Tuners
200
02%
$32,240
Precision Instrument and Equpm4nl Repairers, All Other
a
00%
566,960
IdaiMenance and Repair Workers, General
27,500
23.6%
$39,980
Cain, Vending, and Amusement Marble. SeMcers antl Repairers
500
0.4%
$35,200
Locksmflhs and $afe Repairers
580
0.5 °/n
$40,680
Riggers
0
00%
$56,800
Helpers-- Inslallonen, fdalntenance, and Repair Wakers
4,110
35%
$31,380
Installation, Maintenance, and Rapalr Workers, All Other
4,150
16%
$33,820
Production Occupations
:249,130"
"$31,800.
First-Line Supervisors of Production and Operating Workers
16,390
(12%
$55,890
Aircraft Structure, Surfaces, Rigging, and Systems Assemblers
1,530
MM
537,53a
Coll When, Tapern, and flu "bers
400
02%
$21,630
49
'M
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Electrical and Eledronie Equipment Assemblers
4,260
1.7%
83D,370
Eleclranechanlcal Equipment Assemblers
1,130
05%
$28830
Engine and Other Machine Assemblers
190
0.1%
$3%940
Stmdural Metal Fabricators and Filters
1.020
0.7%
$32,630
Fiberglass Laminators and Fabricators
540
0.2%
$28,920
Team Assemblers
21,320
86%
$26,560
Assemblers and Fabdoet., Arl Other
4,850
20%
$27 ,730
Bakers
7,400
3.0%
$25,740
Butchers and Meat Cutters
5,040
2.0%
$26810
Meal, peakry, antl Fish Cutters and Trimmers
3,430
1.4%
$21,580
Slaughterers and Meal Packers
000
03%
$22,510
Food and Tobacco Roasting, Baking, and Drying Machine Operators and Tentlers
260
011%
$27,600
Food Betchmakers
3,940
1.6%
$26040
Food Cooking Machine Operators and Tenders
650
0.3%
$25,710
Food Procesv, Workers, All Other
550
0.2%
$26,310
Computer- Conrdled Machine Tod Operators, Metal and Flesh.
3,100
1.2%
$37,260
Compeer Numerically Controlled Machine Toot Programmers, Metal and Plastic
900
0.4%
$58,060
Extruding and Droving Machine Echoic, Operators, and Tenders, Metal and Radio
1,400
0.6%
$29,440
Forging Machine Setters, Operdms, and Tenders, Metal and Plastic
1,140
0.5%
$33,830
Roiling Machine Setters, Operators, and Tenders, Metal and Plastic
1,090
0.4%
528,200
Culling, Punching, and Press Machine Setters, Operators, and Tenders, Metal and Plastic
4,250
1 .7%
$28,800
DnUng and Boring Machine Tool Sellers, Operators, and Tenders, Metal and Plastic
860
0.3%
$34,300
Grinding. Lapping, Polishing, and Buffing Machine Tool Setters, Operators, and Tenders, Metal and Plastic
3,660
1.4%
529,840
Lathe and Turning Machine Tool Setters, Operators, and Tenders, Metal and Plastic
1,400
0.6%
$41,870
Wind and Planing Machine Setters, Operators, and Tenders, Meld and Plastic
740
0.3%
$34,170
Machinists
8,610
35%
$37,720
MdaFRefieng Furnace Operators and Tenders
0
00%
$37,820
Pourers and Casters, Metal
300
0.1%
$31,100
Made) Makers, Metal and Plastic
100
DO%
$39,270
PaBemmainim, Model and Plastic
70
0.0%
536,640
Foundry Mold and Coremakers
250
0.1%
$29,350
Molding, Coremaking, and Casting Machine Sellers, Operators, and Tenders, Metal and Plastic
3,620
1.5%
524,380
Multiple Machine Tod Bolters, Operators, and Tenders, Metal and Plastic
1,270
65%
$33,050
Tool and Die Makers
990
0.4%
$48,870
Welders, Cutlers, Solderers, and Brazers
5,410
22%
$36,570
Welding, Soldering, and Brazing Machine Setters. Operators, and Tenders
830
0.3%
$36,830
Heat Treating Equipm ant Setters, Operators, and Tenders, Metal and Plastic
640
03%
$34,920
Layout Workers, Metal and Plastic
160
0.1%
$36,750
Plating and Coxi Machine Setters, Operators, and Tenders, Metal and Plastic
1,380
0.6%
$32.810
Tool Grind. ,Files, and Sharpeners
330
0.1%
$36,580
Metal Workers and Plastic Workers, All Other -
600
0.2%
$34,880
Progress Technicians and Workers
1.320
O5%
$44,590
Printing Press Operators
5,000
20%
$30,470
Print Binding and Flashing Workers -
1,420
0.6%
$28,980
Laindryand Dry-cleaning Workers
7,250
29%
$21,670
Presser; Textile, Garment, and Related Materials
2,300
0.9%
$21,590
Sewing Machine Operators
21,870
8.8%
$20,300
Shoe and Leather Workers and Repairers
0
0.0%
$24,690
Sewers, Hand
550
0.2%
$27,080
Terms, Dresumakers. and Custom Severn
1,750
0.7%
$30,210
Textile Bleaching and Dydng Machine Operators and Tenders
1,870
0.8%
$22,160
Textile Cutting Machine Setters, Operators, and Tenders
2,460
1.0%
$22,700
Textile Knitting and Weaving Machine Setters, Operators, and Tenders
890
0.4%
$20,370
Textile Winding, Twisting, and Drawing Out Machine Setters, Operators, and Termites
200
0.1%
$20,300
Extruding and Forming Machine Setters, Operators, and Tenders, Sl0lhdic and Glass Fibers
230
0.1%
$28,320
Fabric and Apparel Pallemmakers
1,930
0.8%
$49,340
Upholsterers
1,740
0.7%
$29,030
Textile. Apparel, and Fundahings Workers, All Other
1,130
0.5%
$23,190
Cabinetmakers and Bench Carpenters
1,810
0.7%
$40,230
Furniture Finidmrs
540
02%
$28870
Sawing Mashers Sellers, Operators, and Tenders, Wood
350
0A%
$24,280
Woodworking Machine Setters, Operators, and Tenders, Except Saving
860
0,3%
526,380
Woodworkers, AR Other
300
0.1%
$21,510
Power Distributors and Dispatchers
240
O/%
$93,070
Power Plant Operators
1,270
05%
$84,220
Stationary Engineers and Boiler Operators
710
0.3%
$62,500
Water and Wastewater Treatment Plant and System Opera tors
1,560
0,6%
$71,800
Chemical Plant and System Operators
320
0.1%
$45,880
Gas Plant Operators
160
01%
$71,930
Petroleum Pump System Operators, Refinery Operators, and Gaugers
1,410
06%
$73,950
Plant and System Operators, All Other
220
0.1%
$63,320
Chemical Equipment Operators and Tenders
660
0.3%
$44,210
Saparafing, Reading, Clarifying, Precipildhig. and 5181 Machine Setters, Operators, and Tenders
680
03%
$40,400
Crushing, Grinding, and Polishing Machine Setters, Operators, and Tenders
420
0.2%
$29,350
Grinding and Polishing Workers, Hand
1,440
06%
$26,630
Mixing and Blending Machine Sellers, Operators, and Tenders
3.200
1.3%
$31,760
Cutters and Trimmers, Hand
1,390
0,6%
$22,030
Cutting and Slicing Machine Sellers, Operators, and Tenders
1,860
07%
$28,550
Extruding, Forming, Pressing, and Compacting Machine Setters, Operators, and Tenders
8B0
0.4%
$28,280
Furnace, Kiln, Oren, Drier, and Kettle Operators and Tenders
390
02%
$39,550
Inspectors, Testers, Seders, Samplers, and Weighers
13,300
53%
$37,230
Jewelers and Precious Slone and Metal Workers
1,050
04%
$34,080
Dental LaboratoryTechnldans
1,250
65%
$50,450
Medical Appliance Technicians
280
0.1%
$37,500
Ophthalmic Laboratory Technicans
140
0.1%
$28,260
R'S G
54
50
COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Packaging and Filling Machine Operators and Tenders
12,820
6,1%
$26,140
Cooing, Pointing, and spraying Machine Sellers, Operators, and Tenders
2,460
1.0%
S27,630
Painters. Transpodafian Equipment
L000
0.8%
$3070
Painting, COagnq, aad Beemalirg Workers
760
03%
$28,060
Semiconductor Processors
000
BA%
332,210
Phofogrephic Process Workers and Processing Maehine Operators
1,608
07%
337,080
Adhesive Bonding Machine Operators and Tenders
560
02%
S24,030
Cleaning, Washeig, and Mood Pickling Equipment Opemlors and Tenders
580
0.2%
$24,570
Cooling and Freezing Equlpm ant Operators and Tenders
90
0.0%
$25,080
Etchers and Engravers
290
0,1%
$33,700
Mdders, Shapero, and Casters, Except Metal and Plasge
630
03%
$27,440
Paper Goods Machine Setters, Ope ,.fats. and Tenders
2.040
08%
S32,070
Tire Builders
120
0.0%
$20,470
Helpers - Production Workers
13,160
53%
$23,440
Production Workers, AR Other
5,240
Z1%
$31,820
Transportalon and Meddal Moving Occupations
277,830
"$33,710
Aircraft Cargo Handling SUperdvss
0
0.01A
$56050
First -Line SUperdsma of Helpers. Laborers, antl Material Movers, Hand
6,070
2.27u
$46,170
First -Line SuperAsors of Tranymrla110n and MatedaHAadng Machine and Vehicle Operators
6.370
Z31A
$58,600
Alffine Pilots, Copilots. and Flight Engineers
2.940
0,0%
$125,570
Commercial Pilots
010
0.3%
$84,210
Airfield Operations Specialists
150
0.1%
554,910
Flight Attendants
4,540
1.6%
$35,360
Ambulance Drivers and Attendants. acept Fmergeney Medical Technicians
230
0.1%
520,420
Bad D W,% Transit and Intercity
8,390
3.01/.
$40,500
one Drivers, School or Special Client
7,980
79%
$30,840
Wwr /Sales Workers
10,670
3.8%
528,680
Heavy and Tractor-Trager Truck Drivers
31.260
112%
541,500
Light Truck or Delivery Services Orivers
24,430
8.8%
$33,060
Taxi Cdvers and Chauffeurs
4,610
1.7%
$24.020
Motor Vehicle Operators, All Other
2,270
0.8%
$41,190
Suitors end Medina Oilers
0
O.11%
$30,810
Captains, Metes. and Pods of Water Vessels
1.000
0.4%
594.020
Ship Engineers
0
0.014
$81,020
Parking Lot Attendants
10,790
3.9%
$20,950
AummoWe and Watervaft Service Attendants
850
0.3%
$24,060
Traffic Technidane
90
00%
$42,170
TmnspodaBon inspeclore
560
02%
574,370
Transported. Attendants, Except Flight Attendants
540
02%
$30,020
Transportation Workers, All Other
L990
0.7%
$0
Caaveyor Opemtors and Tenders
740
0.3°6
$32,370
Excavating and Loading Machine and Omgline Operators
230
0.1%
$52,750
Industrial Truck and Tractor Operators
18,090
5.8%
$40,520
Cleaners of Vehicles and Equipment
13,160
4.73%
$22,410
Laborers and Freight, Stock, and Material Movers, Hand
75,160
27.1%
$26,270
Machine Feeders and Ofibeards
0
OVVA
$25,770
Packers and Package,., Hard
28,800
10.4%
$21,200
Pump Opemlors, Except Wellhead Pumpers
0
0.0%
$42,010
Wellhead Pampers
0
0.01A
$60,780
Refuse and Recyclable hlatedal Cdleclom
4,280
1.5%
541,730
Material Mating Wokers.All Other
2.640
1.0%
$62,080
®, RSG
55
51
GC)11/iMURCIAL NEMSSTUDYANDLINKAGE IFEEANALYSIS
Attachment 2: Affordable Housing Product Type Pro Forma
x
56
of Santa Monica
52
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COMMERCL L NEXT) S STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
®,s
58
54
Median
VL ''
Low
Moderate
Market Rate
Market
Average
Market
EL Income
Income
Income
Income
Apartments
Unit Mix
Unit Size
Rent
Rent `
Rent
Rent
Rent
Studio
25%
500
n.a.
$290
$517
$630
$1,197
1 Bedroom
25%
600
$2,339
$330
$589
$719
$1,367
2 Bedrooms
25%
850
$3,546
$371
$663
$809
$1,537
3 Bedrooms
25%
1,080
$4,409
$412
$736
$898
$1,708
Wt.Avg.
758
n.a.
$351
$626
$764
$1,452
®,s
58
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COMMERCIAL NEXUS STUDY AND LINKAGE FEE ANALYSIS
of Santa Monica
Attachment 3: Linkage Fee Alternatives
61
57
Direct
Total
Construction Construction
Analysis
of Full Impact Fee
Analysts of
Reduced Impact
Fee
Analysis of
Reduced Impact
Fee
Binding Type
Cost'
Co,,**
1W %Fee
%Direct
%Total
5 %Fee
%Direct
%Total
30 %Fee
%Direct
%TOtat
Office
$299.00
$695.35
$115.05
38.5%
16.5%
$5.75
1.9%
018%
$11.51
3.8%
1.7%
R &D
$148.00
$344.19
$115.05
77.7%
33.4%
$5.75
3.9%
1.7%
$11.51
7.8%
3.3%
Gov /Instutional
$251.00
$583,72
$24.66
9.8%
4.2%
$1.23
0.5%
0.2%
$2.47
1.0%
0.4%
Hotel
$262.00
$609.30
$65.21
24.9%
10.7%
$3.26
1.2%
0.5%
$6.52
2.5%
1.1%
Medical Offices
$323.00
$751.16
$134.10
41.5%
17.9%
$6.71
2.1%
0.9%
$13.41
4.2%
1.8%
Hospitals
$529.00
$1,230.23
$141.53
26.8%
11.5%
$7.08
1.3%
0.6%
$14.15
2.7%
1.2%
Out Centers
$418.00
$97209
$134.10
32.1%
13.8%
$6.71
1.6%
0 .7%
$13.41
3.2%
1,4%
Light Ind /Manufacturing
$91.00
$211.63
$45.43
49.9%
21.5%
$2.27
2.5%
1.1%
$4.54
5.0%
2.1%
Restaurants
$314.00
$730.23
$96.54
30 .7%
13.2%
$4.83
1.5%
0 .7%
$9.65
3.1%
1.3%
Fast Ford
$259.00
$602.33
$96.54
37.3%
16.0%
$4.83
1.9%
0.8%
$9.65
3 .71/5
1.6%
Drug Stores
$162.00
$376.74
$96.54
59.6%
25.6%
$4.83
3.0%
1.3%
$9.65
6.0%
2.6%
Retail Stores
$202.00
$469.77
$96.54
47.8%
20.6%
$4.83
2.4%
1.0%
$9.65
4.6%
2.1%
Neighborhood Retail
$119.00
$276.74
$96.54
81.1%
34.9%
$4.83
4.1%
1.7%
$9.65
8.1%
3.5%
Super Markets
$135.00
$313.95
$96.54
71.5%
30.7%
$4.83
3.6%
1.5%
$9.65
7.2%
3.1%
Mega Whze Stores
$69.00
$160.47
$96.54
139.9%
60.2%
$4.83
7.0%
3.0%
$9.65
14.0%
6.0%
The S %fees,, /lest the
lem,,,nd
The 10 %fees reflect®r
midrange
range more closely
that wouldresult in a
nominal
approxlmatingthahmader
Increase
to tota / Cnstruction
experience
in other
cities,
cosh.
Analysis of
Reduced Impact Fee
Analysis of Reduced Impact Fee
Analysis of Reduced impact Fee
guiding Type
15 %Fee
%Direct
%Total
20 %Fee
%Direct
%Total
25 %Fee
%Direct
%Total
Office
$17.26
5.8%
2.5%
$23.01
7.7%
3.3%
$28.76
9.6%
4.1%
R &D /Cealive
$17.26
11.7%
5.0%
$23.01
15.5%
6.7%
$28.76
19.4%
8.4%
Gov /Imbaionel
$3.70
1.5%
0.6%
$4.93
2.0%
0.894
$6.17
25%
1.1%
Hotel
$9.78
3.7%
1.6%
$13.04
5.0%
2.1%
$16.30
6.2%
2.7%
Medical Offices
$20.12
6.2%
2.7%
$26.82
8.3%
3.6%
$33.53
10.4%
4.5%
Hospitals
$21.23
4.0%
1.7%
$28.31
5.4%
2.3%
$35.38
6.7%
2.9%
Out Centers
$20.12
4.8%
2.1%
$26.82
6.4%
2.8%
$33.53
8.0%
3.4%
Light Ind /Manufacturing
$6.81
7.5%
3.2%
$9.09
10.0%
4.3%
$11.36
12.5%
5.4%
Restaurants
$14.48
4.6%
2.0%
$19.31
6.1%
2.6%
$24.14
7.7%
3.3%
Fast Food
$14.48
5.6%
2.4%
$19.31
7.5%
3.2%
$24.14
9.3%
4.0%
Drug Stares
$14.48
8.9%
3.8%
$19.31
11.9%
5.1%
$24.14
14.9%
6.4%
Retail Stores
$14.48
7.2%
3.1%
$19.31
9.6%
4.1%
$24.14
11.9%
5.1%
Neighborhood Retail
$14.48
12.2%
5.2%
$19.31
16.2%
7.0%
$24.14
2131.
8.7%
Super Market,
$14.48
10.7%
4.6%
$19.31
14.3%
6.1%
$24.14
17.9%
7.7%
Mega Whse Stores
$14.48
21.0%
9.0%
$19.31
28.0%
12.0%
$24.14
35.0%
15.0%
The 15 %fees reflect the higher
end range approximating
the San
Frvnclscofeeschedule.
' DireRCOnstuairn rost derviedfrom Marshall &AVi
/t Voluv[Ion
Service data.
" Total COnelrucflon Crstexludes land aortand assumesdirertmst to re /lecfa6out43 %of the total Cnstruction
cost.
Nate: Linkage Fee mtsmentive, In tables are expressed as a pereent
increase to Direct
Construction and Total Construction
Costs.
61
57
Economic & Planning Systems, Inc.
One Kaiser Plaza, Suite 14.10
Oakland, CA 94612 -3604
510.841.9190 tel
510.740.2080 fax
Oakland
Sacramento
Denver
Los Angeles
www.epsys.cont
Parks and Recreation
Development Impact Fee Study
Prepared for:
City of Santa Monica
Prepared by:
Economic & Planning Systems, Inc.
August 2013
EPS #121077
Table of Contents
1. INTRODUCTION, RESULTS, AND RECOMMENDATIONS .......................... ............................... 1
Report Background and Legal Context .......................................... ............................... 1
Maximum and Recommended Fee Schedules .................................. ..............................2
Methodology, Assumptions, and Sources ........................................ ..............................4
Fee Program Implementation and Administration ............................ ..............................5
ReportOrganization .................................................................... ..............................7
2. POLICY AND FINANCING CONTEXT ............................................... ............................... 8
Parks and Recreation Master Plan ................................................. ..............................8
Parks and Recreation Funding ....................................................... ..............................9
3. MITIGATION FEE ACT NEXUS FINDINGS ....................................... ............................... 11
4. DEVELOPMENT FORECAST AND NEW PARKS DEMAND ........................ ............................... 12
Existing and Forecast Demographic and Employment Growth ........ ............................... 12
Service Population and New Parks Demand ................................. ............................... is
S. PARKS AND RECREATION FACILITIES AND COSTS ............................ ............................... 19
Parkland................................................................................. ............................... 19
Parks and Recreation Capital Facilities ........................................ ............................... 20
6. DEVELOPMENT IMPACT FEE CALCULATIONS BY LAND USE .................. ............................... 22
Cost Allocation by Land Use ....................................................... ............................... 22
MaximumFee Estimates ............................................................. .............................23
7. PARKS AND RECREATION FEE COMPARISONS ................................. ............................... 26
Context.................................................................................. ............................... 26
FeeComparisons ..................................................................... ............................... 27
List of Tables
Table 1
Maximum and Recommended Development Impact Fees ......... ..............................3
Table 2
Baseline and Projected Growth in Housing and Resident Population .......................
13
Table 3
Employment and Projected Growth in Nonresidential Uses ..... ...............................
14
Table 4
Hotel Development and Projected Growth ........................... ...............................
15
Table 5
Baseline and 2030 Projected Service Population ................... ...............................
16
Table 6
Estimated Required Parkland Investment to Serve New Growth ............................
19
Table 7
Cost Estimates of Existing City Parks & Recreation Facilities .. ...............................
20
Table 8
Total Parks Fee Program Costs ........................................... ...............................
21
Table 9
Distribution of New Service Population by Land Use Category .. .............................22
Table 10
Fair -Share Cost Allocation by Land Use Fee Category ............ ...............................
23
Table 11
Estimated Maximum Parks Fee per Unit .............................. ...............................
24
Table 12
Maximum Development Impact Fee Estimates with Administrative Costs ...............
25
Table 13
Comparison of Park Fees ................................................... ...............................
28
1. INTRODUCTION, RESULTS, AND RECOMMENDATIONS
This Development Impact Fee Report provides the City of Santa Monica (the City) with the
necessary technical documentation to support the adoption of a Citywide Development Impact
Fee Program to fund parks and recreation capital facilities, including land acquisition, parks
improvements, and facilities. It has been prepared by Economic & Planning Systems, Inc. (EPS)
under the management of the Community & Cultural Services Department, the Planning and
Community Development Department, and the City Attorney's office. The new parks and
recreation development impact fee schedule is intended to replace the City's current Parks and
Recreation Facilities Tax as well as the parks component of the Housing and Parks In -Lieu Fee.
Report Background and Legal Context
The City of Santa Monica's current tax and fee schedule includes two one -time charges on new
development that support parks and recreation improvements - a flat one -time $200 per
residential unit Parks and Recreational Facilities Tax (Santa Monica Municipal Code Section 6.8)
and, as of July 2013, a $5.11 per square foot Housing and Parks In -Lieu Fee (Santa Monica
Municipal Code Section 9.04.10.12) on general office only, that is adjusted monthly using an
inflation index. The $5.11 per square foot fee applies to the first 15,000 square feet of general
office development and increases to $11.35 per square foot for additional development above
this size. About half of the revenues from the Housing and Parks in -lieu fee are available to fund
parks and recreation improvements. Together, these charges provide only modest revenues to
the City due to the low tax on residential development, relative to most cities with parks and
recreation fees, and the limited number of general office uses that pay the mitigation fee.
The establishment of a new set of parks and recreational capital facilities fees has become
prudent in light of: (1) the limited revenues being generated by existing parks funding sources,
(2) the loss of other sources of potential capital improvement funding (e.g., redevelopment),
(3) the City's ongoing commitment to expanding and improving its parks and recreational
amenities, and, (4) the increasing number of California jurisdictions that are successfully
generating parks and recreation capital facilities revenues through development impact fees
under the Mitigation Fee Act and /or parkland in -lieu fees under the Quimby Act.
The Mitigation Fee Act (A131600 et seq.) allows the City of Santa Monica to adopt parks and
recreation development impact fees on new development to fund the associated, additional costs
of providing parks and recreation capital facilities. Unlike Quimby Act parkland in -lieu fees, an
alternative form of parks and recreation development fees, the Mitigation Fee Act allows for fees
to be charged to all new development that increases the need for capital facilities., As a result,
the Mitigation Fee Act is the preferred statutory authority for establishing the new parks and
recreation development impact fee schedule in the City of Santa Monica.
, Quimby Act fees under the Subdivision Map Act can only be charged on new, subdivided residential
development. In other words, the Quimby Act fees would not apply to apartment development or any
nonresidential development, a substantial portion of forecasted future development in the City.
Economic & Planning Systems, Inc. 1 P:lunma�1uonsamanow� Pa.esreejR�cdUuonrenon e- 1- 13_cuEWdon
Parks and Recreation Development Impact Fee Study
Report 08101113
This Report provides the necessary technical analysis to support a schedule of fees to be
established by an Impact Fee Ordinance and Resolution. The Mitigation Fee Act allows the City
to adopt, by Resolution, the Parks and Recreation Fee Schedule consistent with the supporting
technical analysis and findings. provided in this Report. The Resolution approach to setting the
fee allows periodic adjustments of the fee amount as may be necessary over time, without
amending the enabling Ordinance.
The technical analysis in this Report estimates the parks and recreation fee schedule that will
fund new development's "fair share" contribution to future City investments in parks and
recreation capital facilities. The key requirements of the Mitigation Fee Act that determine the
structure, scope, and amount of the proposed Fee Program are as follows:
Collected for Capital Facility and Infrastructure Improvements. Development impact
fee revenue can be collected and used to cover the cost of capital facilities and infrastructure
required to serve new development and growth in the City. However, impact fee revenue
cannot be used to cover the operation and maintenance costs of these or any other facilities
and infrastructure.
• Cannot Fund Existing Needs. Impact fee revenue cannot be collected or used to cover
deficiencies in existing City capital equipment and facilities. The portion of capital costs
required to meet the needs of the City's existing population must be funded through other
sources. Capital facility investments that increase service standards for existing and new
development must be split on a "fair share" basis according to the proportion attributable to
each.
Must Be Based on a Rational Nexus. An impact fee must be based on a reasonable
nexus, or connection, between new growth and development and the need for a new facility
or improvement. As such, an impact fee must be supported by specific findings that explain
or demonstrate this nexus. In addition, the impact fee amount must be structured such that
the revenue generated does not exceed the cost of providing the facility or improvement for
which the fee is imposed.
The City can choose to charge parks and recreation development impact fees below the
maximum, supportable fee schedule. Such downward adjustments in the fee schedule, if
selected, are typically based on policy considerations related to considerations of development
feasibility, fee levels in peer cities, or the unique characteristics of individual development types,
such as affordable housing.
u. . - - `.
Table 1 shows the City's maximum supportable parks and recreation fee schedule as well as the
recommended fee schedule. The maximum fee schedule is based on the nexus findings and
technical analysis contained in this Report and represents the maximum parks and recreation
fees the City could charge consistent with the Mitigation Fee Act. The recommended fee
schedule reflects a downward adjustment based on considerations of the parks and recreation
fees charged in others cities and development feasibility analysis conducted for the City. The
new parks and recreation development impact fees will apply to new residential and
nonresidential development to fund a share of future parks and recreation capital facilities
investments in the City. The fee estimates include a 2 percent fee program administration fee,
Economic & Planning Systems, Inc. 2 P-u21000U21077sanraAfoni� PaeSF �Re pan 121077mPOn a- 1- 13CUEr ..ao�
Parks and Recreation Development Impact Fee Study
Report 08101113
consistent with other Mitigation Fee Act program administrative costs in many other California
jurisdictions.2
Table 1 Maximum and Recommended Development Impact Fees'
Fee Categories
Persons/
Household
Estimated
Maximum Fee
Recommended
Feet
Residential (Average)
1.667
$20,238
$5,060
per Dwelling Unit
Single Family Units
2.515
$30,543
$7,636
per Dwelling Unit
Multi Family Units (Studio /1 bedroom)
1.363
$16,554
$4,138
per Dwelling Unit
Multi Family Units (2+ bedrooms)
2.196
$26,661
$6,665
per Dwelling Unit
Nonresidential
Office/ Creative Space
.$9.24
$2.31
per Sq. Ft.
Medical Office/ Hospital
$5.08
$1.27
per Sq. Ft.
Retail
$5.98
$1.49
per Sq. Ft.
Hotel
$12.45
$3.11
per Sq. Ft.
Industrial
$5.18
$1.30
per Sq. Ft.
[1) Includes fee program implementation and administrative costs.
[2) Recommended fees include a discount of 75 percent across the board. The City will determine whether to remove
this discount overtime.
Sources: Cityof Santa Monica; Economic & Planning Systems, Inc.
As shown in Table 1, the maximum parks and recreation development impact fees are $20,238
per average residential unit, ranging from $16,554 to $30,543 depending on the estimated
occupancy densities for different housing product types and between $5.08 per square foot and
$12.45 per square foot for nonresidential uses. Under the maximum fee schedule, new
development would generate new revenues capable of funding sufficient parks and recreation
improvements and land acquisition to maintain the current service standard in the City. The
maximum parks and recreation development impact fee levels are particularly driven by the
substantial investments that would be required to acquire additional land for parks in the City
with land acquisition costs accounting for about 72.6 percent of the maximum fee level.
2 The 2 percent administration cost is designed to cover the costs of preparation of the development
impact fee as well as the required reporting, auditing, collection and other annual administrative costs
involved in overseeing the program. Development impact fee programs throughout California have
applied similar administrative charges.
Economic & Planning Systems, Inc. 3 PN21000�t21077 a Wnim Pzr ,Fee�kepotl1121077report e- 1- 13cuenrdo«
Parks and Recreation Development Impact Fee Study
Report 08101113
Fee comparisons with other cities indicate that at these maximum levels, the City would be
adopting parks and recreation fees at the highest end of the spectrum for California jurisdictions
on both future residential and nonresidential development.3 In addition, development feasibility
analysis conducted by HR&A has indicated that the collective increases in transportation, parks
and recreation, and affordable housing fees will pose feasibility challenges to new development if
adopted at the'maximum, allowable levels. As a result, the recommended parks and recreation
development impact fee schedule is below the maximum fee level. Specifically, a substantial
reduction of the maximum fee (75 percent) is recommended that results in overall recommended
fee levels at 25 percent of the maximum level. This reduction seeks to balance the importance
of investments in parks and recreation facilities to maintaining quality of life in the City with the
cost burdens new fees place on new development.
As shown in Table 1, the recommended fee level is an average of $5,060 per residential unit,
ranging from $4,138 to $7,636 per unit. For nonresidential development, the recommended fee
level ranges from $1.27 per square foot (medical office /hospital development) to $3.11 per
square foot (hotel development).
Methodology, Assumptions, and Sources
The results of this study are based on a variety of assumptions and sources. Details on the
methodology, assumptions, and sources are described in detail in Chapters 4, s, and 6.
Selected underlying assumptions and sources are summarized below: -
• Policy Framework. The 1997 Parks and Recreation Master Plan and the associated General
Plan Open Space Element outlined a series of strategies and potential investments to provide
for a substantial expansion in parks and recreation facilities in the City in the 2000 to 2020
timeframe. The Master Plan provides policy support for the establishment of new parks and
recreation fees. The Master Plan recognized the need for major investments and envisioned
contributions from a range of financing sources and from all types of park users. At this
time, the Master Plan has not been updated for the 2010 to 2030 period (though it continues
to guide investment strategies). In addition, no specific parks and recreation facilities or
parkland standards have been formally adopted.
• New Development Contribution. Because the City has not established a list of required
parks and recreation improvements for the 2010 to 2030 period, the current levels of
provision of parks and recreation facilities and parkland by the City were used as the basis
for determining the fair share contribution of new development. Specifically, the current
replacement value of all City parks and recreation facilities was estimated along with the
current number of City park acres. These current values and acres were converted into "per
service population" metrics. For example, the City's existing parkland of 131.4 acres was
divided by the estimated service population to obtain an existing level of service of 1.19
acres per 1,000 service population. This existing standard could then be applied to the
3 See Chapter 7 for detailed information on fee comparisons. Fee comparisons considered one -time
fees /taxes specifically for parks and recreation facilities and parkland in other cities. In other words,
comparisons included consideration of Quimby Act in -lieu parkland fees and one -time special taxes for
parks and recreation capital purposes.
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forecasted service population growth to help determine the fair share contribution of new
development and the associated fee levels.
• Growth and Development. The impact fee calculations are based on estimates of new and
existing development, population, employment, and overnight visitors for the 2010 to 2030
period. Some of these estimates relied on estimates of persons per household, square feet
per employee, and overnight visitorship per hotel room. These estimates relied on a number
of sources including the Land Use and Circulation Element (LUCE) and its EIR, Census 2010,
the Census American Community Survey, and California Department of Finance. The LUCE
was the key source for estimates of new development in the City.
• Park Demand and Cost Allocation. Capital costs were allocated to new development as
well as between different new land uses based, in part, on relative levels of demand. Service
population was used as the measure of demand, with equivalencies established between
residents, employees, and overnight visitors based on studies of other jurisdictions. This
resulted in estimates of one employee as the equivalent of 0.2 residents and one overnight
visitor as the equivalent of 0.15 residents. Costs were then allocated appropriately using
these relative demand factors and the relevant estimates of existing and future growth and
development.
• Current Parks and Recreation Facilities Replacement Costs. City staff inventoried its
full set of parks and recreation facilities. Subsequently, City staff developed planning -level
estimates of 2013 per square foot facilities values.
• Current Parkland and Value. A list of current City parks and recreation areas along with
the associated acreage was developed by City staff. EPS interviewed City staff and reviewed
information on recent land acquisition purchases to determine a planning -level estimate of
per acre land value.
• Fee Comparisons. Parks and recreation fee comparisons were based on a review of fee
schedules in a range of different cities. Fee comparisons are useful for general, comparison
purposes to inform City decisions concerning fee levels. As discussed in Chapter 7, fee
comparisons do not always capture the complete funding picture and, due to frequent
refinements and revisions, fee schedules are constantly changing.
T r
The Mitigation Fee Act includes a series of reporting requirements designed to ensure that
development impact fee revenues are properly accounted for, used appropriately, and that,
where funds are ultimately not used, are reimbursed. In addition, jurisdictions adopting fee
programs should determine their preferred approach to updating the fee schedule and whether
they intend to allow for exemptions, credits, and reimbursements (under any additional
circumstances). The following fee program implementation and administration parameters are
recommended for the City of Santa Monica's new parks and recreation development fee.
Credits, Reimbursement, and Exemptions
Under certain and limited circumstances, as determined by the City, the Impact Fee Resolution
could allow developers subject to the fee to obtain credits, reimbursements, or exemptions. In
cases of redevelopment, the demolition of space should provide a fee credit in a similar manner
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to the City's recently adopted transportation impact fee. In other words, the gross fee obligation
should be calculated based on the scale of the proposed new development, with a fee credit to
be applied for existing square footage to be removed (or retained) using the applicable fee for
the existing square footage (land uses).
All other fee credits and /or reimbursements should not be allowed by right but rather should be
subject to review by City staff and Council to ensure that such credits or reimbursements are
warranted and appropriate. Potential examples where fee credits and reimbursements might be
considered include: (1) cases where the City would prefer on -site dedication of parkland and
associated park improvements rather than fee payments, or, (Z) cases where a Development
Agreement specifically envisions extraordinary, direct investments in parks and recreation
facilities of equal to or greater value to the City than the applicable parks and recreation fees.
Exemptions where the City elects not to impose fees for certain categories of development, such
as affordable development are also an option, though alternative funding sources to offset a loss
in fee revenue would need to be provided.
Securing Supplemental Funding
The maximum, supportable development impact fee is set to cover the parks and recreation
facilities investments that will maintain citywide capital facilities standards as new growth occurs.
To the extent that the City's goals envision an overall increase in parks and recreation facilities
and parkland standards, supplemental funding will be required to cover these service -level
increasing investments. In addition, to the extent that exemptions are provided for particular
types of development, supplemental funding will be required to make up for this lost funding.
For the City of Santa Monica, any required supplemental funding (i.e., funding not from new
development) is most likely to be provided by State and federal grant funding and /or the City's
General Fund, though could also come from a number of other sources.
Annual Review and Periodic Study Update
The Mitigation Fee Act /AB 1600 (at Gov. C. §§ 66001(c), 66006(b)(1)) stipulates that each local
agency that requires payment of a fee make specific information available to the public annually
within 180 days of the last day of the fiscal year. This information includes the following:
• A description of the type of fee in the account
• The amount of the fee
• The beginning and ending balance of the fund
• The amount of fees collected and interest earned
• Identification of the improvements constructed
• The total cost of the improvements constructed
• The fees expended to construct the improvement
• The percentage of total costs funded by the fee
For the purposes of the new parks and recreation fee, a single account should be established into
which all fee revenues are placed. Because of the dynamic nature of growth and capital
equipment requirements, the City should monitor inventory activity, the need for improvements,
and the adequacy of the fee revenues and other available funding. To the extent, particular
issues are identified, adjustments to the fee program may be required.
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Without particular issues requiring immediate attention, it is recommended that the Impact Fee
Ordinance allows for an automatic annual adjustment to the fees based on the percent change in
the appropriate Construction Cost Index as published by Engineering News Record for the
preceding 12 months period. Over time, development forecasts may be revised, new policy
documents and associated goals for parks and recreation capital improvements might be adopted
(e.g., through revised Mater Plan), costs will change and evolve, and new information on the
sources of park demand (e.g., through intercept surveys) may become available, making
periodic technical updates prudent. Costs associated with this monitoring, reporting, and
updating effort are included in the parks and recreation development impact fee schedule and
are assumed to add 2 percent to fee program capital costs.
Surplus Funds
The Mitigation Fee Act /AB 1600 also requires that if any portion of a fee remains unexpended or
uncommitted in an account for five years or more after deposit of the fee, the City Council shall
make findings once each year: (1) to identify the purpose to which the fee is to be put, (2) to
demonstrate a reasonable relationship between the fee and the purpose for which it was
charged, (3) to identify all sources and amounts of funding anticipated to complete financing of
incomplete improvements, and (4) to designate the approximate dates on which the funding
identified in (3) is expected to be deposited into the appropriate fund ( §66001(d)).
If adequate funding has been collected for planned improvements, an approximate date must be
specified as to when the cost of the improvement will be incurred. If the findings show no need
for the unspent funds, or if the conditions discussed above are not met, and the administrative
costs of the refund do not exceed the refund itself, the local agency that has collected the funds
must refund them (Gov. C §66001(e)(f)).
Following this chapter, Chapter 2 provides the policy and financing context to the establishment
of a new parks and recreation development impact fee in the City of Santa Monica and Chapter
3 provides the required nexus findings under the Mitigation Fee Act. Chapter 4 describes the
existing and future development and associated demographic, economic, and visitor information.
It also describes the applied measures of relative demand by land use for parks and recreation
facilities. Chapter 5 estimates the new parks and recreation facilities and land costs that could
be allocated to new development and Chapter 6 estimates the maximum, supportable fees
under the Mitigation Fee Act. Chapter 7 provides information on parks and recreation fees
charged in other California jurisdictions to inform the City's policy decision concerning the
appropriate fee schedule for adoption.
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2. POLICY AND FINANCING CONTEXT
i
With substantial community input, the City of Santa Monica completed its Parks and Recreation
Master Plan in March 1997. The purpose of the Master Plan was "to guide the improvement of
the City's parks and recreational facilities over the next twenty years." The Master Plan was
based on the (General Plan) Open Space Element the draft of which was prepared
simultaneously and outlines specific actions to help implement Open Space objectives and
policies. The final Open Space Element was adopted in 2001.
The Parks and Recreation Master Plan has helped guide City investments in a broad range of
parks, open space, and recreation facilities. The Master Plan builds on and complements the
City's long history of park development as well as the recreational assets represented by the
beach, additional State recreation lands, and school district investments. The Master Plan called
for the "largest expansion of the park and recreational system in the history of the city ",
including the goal of adding tens of acres of new parks and thereby increasing the parks
inventory by as much as 50 percent. The Master Plan vision and goals were captured in a broad
array of Parks and Open Space strategies and Recreation Program strategies.
Financing Principles and Strategies
The financing and implementation section of the Master Plan included a number of project
consultant recommendations for financing capital and operating costs associated with the
proposed facilities and improvements. The City indicated that the financing strategies would be
refined in the context of short and long -term budget processes. For example, the Parks and
Recreation Master Plan states:
"Funding sources should equitably share the burden among all park and recreation facility users.
Everyone who lives and works in and visits the City of Santa Monica benefits from amenities
offered by the parks, beaches, and various recreational facilities. Therefore, funding used to
implement the Master Plan should come from all users of parks and recreation facilities to the
extent possible ".
Capital Facilities and Financing Sources
The Master Plan included a broad array of proposed capital facilities and improvements,
envisioned for the 2000 to 2020 period, along with preliminary cost estimates. The preliminary
cost estimates were for over $100 million in improvements in 1997 dollar terms. Improvement
categories included capital improvements in existing parks throughout the City as well as the
development of new parks and recreational facilities in the Civic Center, at the beach, and at
schools. The acquisition of additional parkland was also envisioned along with investments in
aquatic facilities. New ball fields, courts, and other recreational amenities are envisioned along
with new park buildings of a variety of types (community center, gymnasium, etc.).
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The financing and implementation chapter also identified a broad array of potential funding
sources for parks and recreational capital facilities. Unrestricted funding sources (to parks) and
competitive sources identified included General Fund Capital Improvement Program Funds, Tax
Increment funds, Transient Occupancy Tax funds and Civic Development Funds (Civic Center
only), and Community Development Block Grants. Dedicated capital funding sources, by
contrast were limited to, the existing park impact fee and tax, with the Beach Fund noted as a
potential source once maintenance costs were covered. The need for additional capital funding
from Citywide Community Facilities District or General Obligation Bond financing was viewed as
likely to accomplish the Master Plan goals in the preferred timeline.
Parks and Recreation Funding
As the City continues to move forward in achieving the Master Plan vision and responding to the
new and changing needs of the community, the need for new parks and recreation funding
continues. With multiple demands on unrestricted sources of City funding (General Fund Capital
Improvement Program, transient occupancy taxes etc.) and the loss of other important sources
of capital improvement revenue,(tax increment funding), parks and recreation funding cannot
rely solely on unrestricted funding sources.
The City's Municipal Code does currently place two "parks and recreation fees" on new
development to fund parks and recreation capital facilities:
• Parks and Recreation Facilities Tax (SMMC Section 6.8, adopted July 1973).4 The City
collects a dwelling unit /parks and recreation facilities tax of $200 per unit for its Parks and
Recreation Fund. The fee was set at a flat, non - increasing level and was at the same rate at
the time of the adoption of the Master Plan (1997).
• Housing and Parks In -Lieu Fee (SMMC Section 9.04.10.12, adopted April 1986). General
office development (including medical office, but excluding creative office) pays a Housing
and Parks In -Lieu Fee associated with a Parks Mitigation Fund. In -lieu payments satisfy the
Project Mitigation Measures of the 1984 Land Use and Circulation Element of the General
Plan. In -lieu fees are paid by new general office developments of over 15,000 square feet of
new construction or 10,000 square feet of additions to existing development. In -lieu fees are
updated monthly based upon the most current available Consumer Price Index (CPI) figure.
As of July 2013, the In -Lieu Fee was set at $5.11 per square foot for the first 15,000 square
feet and $11.35 per square foot for additional square footage above this amount.
These sources have, however, only generated modest funding for a variety of reasons. For
residential development, the fee is low and its value continues to erode with inflation over time.
For nonresidential development, only one sub - category of development (general office) is
required to pay the fee and the fee revenues are split between parks and housing purposes. In
addition, the definitions of general office (that pays the fee) relative to creative office (that does
not) has created implementation challenges and has reduced fee collection as the modern
workforce occupying new office space is increasingly viewed as creative.
4 SMMC = Santa Monica Municipal Code
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In the context of the need for additional funding to continue to implement the Parks and
Recreation Master Plan and to meet the parks and recreational needs of a growing service
population (residents, employees, and visitors), the City identified a Parks and Recreation
Development Impact Fee as a potential source of direct funding for future parks and recreation
capital facilities needs. The purpose of the fee, consistent with legal requirements (see below),
is to provide a direct funding source from new residential and commercial development for the
upgrade and /or expansion of parks and recreational facilities needed to accommodate additional
occupants of the new developments. The adoption of a parks and recreation development
impact fee (as described in Chapter 7) is common practice among California jurisdictions,
though the parameters of the fee program can vary widely. The recommended parks and
recreation development impact fee, if adopted, would replace one existing fee and a portion of
the existing In -Lieu fee devoted to parks.
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3, MITIGATION FEE ACT NEXUS FINDINGS
This chapter describes the necessary "nexus" between new development in Santa Monica and the
proposed capital facilities investments, as required under the Mitigation Fee Act - Government
Code Section 66000 (AB1600). The new parks and recreation development impact fees will
cover up to the investments in parks and recreation facilities, improvements, and land
acquisitions required to maintain existing levels of capital facilities service in the City - the "fair
share" contribution of new development.
Nexus findings address: (1) the purpose of the fee and a related description of the facility for
which fee revenue will be used, (2) the specific use of fee revenue, 3) the relationship between
the facility and the type of development, (4) the relationship between the need for the facility
and the type of development, and (S) the relationship between the amount of the fee and the
proportionality of cost specifically attributable to new development. The subsections below
describe the nexus findings for the Parks and Recreation Development Impact Fee.
Purpose
The fee will ensure an expansion in parks and recreation capital facilities in the City of Santa
Monica as new growth occurs.
Use of Fee
Fee revenue will be used for a broad range of parks and recreation capital facilities investments,
including the acquisition of land for parks, the improvement of existing and new parkland, and
development of new parks and recreation facilities.
Relationship
New development in the City of Santa Monica will increase the demand for and use of parks and
recreation facilities. Fee revenue will be used to help fund new parks and recreation facilities in
response to the increased demand.
Need
Each new development project - residential and nonresidential - will generate incremental, new
demand and use of the City's parks and recreation facilities by new residents, workers, and /or
visitors. New revenues to fund investments in additional parks and recreation capital
improvements are necessary to maintain parks and recreation capital facilities service standards
Proportionality
The maximum, supportable parks and recreation fee schedule was based on a parks and
recreation capital facilities cost estimate derived by applying the proportionate increase in
service population associated with new development to the existing service standard /value of
parks and recreation capital facilities. As a result, the fee program cost estimates are directly
proportional to the relative increase in new development.
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4. DEVELOPMENT FORECAST AND NEW PARKS DEMAND
This chapter describes existing and projected future development in the City of Santa Monica and
estimates the associated demographic and economic growth that support the park and recreation
development impact fee calculations. Forecasts of population and employment growth rely on
the growth projections of dwelling units and nonresidential building space developed for the
City's 2010 Land Use and Circulation Element (LUCE) Final EIR (EIR). The chapter also
estimates and describes the City's existing and new park and recreation service population (level
of demand) associated with residents, employees, and hotel guests, which is the basis for
determining the cost share allocatable to new development as well as allocating fee program
costs between residential and nonresidential land uses.
Existing (2010) and forecasted (2010 to 2030) demographic, economic, and visitorship
information are used for the following primary purposes in the fee calculation:
Estimates of existing development and associated, population, employment, and average
overnight visitor levels are used to define baseline conditions and help determine current
service standards;
Estimates related to population, employment, and visitor density (e.g., persons per
household, square feet per employee, hotel guests per occupied room) are used to estimate
population growth associated with the City's LUCE EIR's projected increase of 4,955 units,
employment growth associated with the projected net increase of 3.1 million building square
feet of employment type land uses, and average daily overnight visitor levels associated with
the projected increase of about 2,100 rooms.
Forecasts of future population and employment growth in the City are the basis for
determining associated growth in the parks service population and thus the future need for
park capital facilities which can be funded by the fee.
Existing and Forecast Dernograpnic and Ernpioyment
Growth
Residential Development and Population Growth
According to Census 2010, the City had a total population of 89,736 and an inventory of 50,912
dwelling units. With a household population of 87,551 and 46,917 occupied units, the City has
an average household size (persons per occupied unit) of 1.866 persons per household, with
multifamily units and single - family units averaging 1.667 and 2.515, respectively.5 With respect
to occupancy, a comparison of total units to occupied units suggests that the City had a vacancy
rate of 7.8 percent. However, excluding units counted vacant by nature of their use such as
second homes occupied only seasonally, the City's core residential vacancy rate was 4.4 percent.
5 Average household sizes for single - family and multifamily units based on American Community
Survey data from 2007 to 2011.
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The LUCE EIR forecasts an increase of 4,955 units to the City's inventory of housing units by
2030 of which only four units would be single - family units. The other 4,951 units or 99.9 percent
would be composed of multifamily units.6 To forecast the growth in household population
corresponding to this increase in dwelling units, EPS conservatively applies the 4.4 percent
vacancy rate and estimates that of the 4,955 total new units, 4,737 units will be occupied on
average. Based on an average household size of 1.667 (the current estimate for persons per
household in multifamily developments), the new occupied units will result in population growth
of 7,895 by 2030. Compared to the 2010 (baseline) population, this represents an 8.8 percent
growth in the City's population as shown in Table 2.
Table 2 Baseline and Projected Growth in Housing and Resident Population
Conditions
Housing Units
Total Occupied
(Households)
Population
Total in Households
Avg. HH
Size
Baseline (2010 Census)
50,912
46,917
89,736 87,551
1.866
Projected Growth'
44,955
44,737
7,895 77,895
1.667
Buildout(2030 Projection)
55,867
51,654
97,631 95,446
% Change (2010 -2030)
9.7%
8.8%
[1 ] Average household (HH) size measures the average number of persons in occupied units only.
Baseline HH size is based on all units citywide. Because future units are projected to be almost 100%
multifamily units, the HH size used to estimate future population is based on the current HH size in
multifamily units.
[2] Baseline employment data and projected growth are from the Citys 2010 LUCE Final EIR.
[3] Projected growth in housing units from the City of Santa Monica LUCE Final EIR, 2010. Estimate of
4,737 occupied units assumes a vacancyof4.4% based on 2010 census data. Population growth
was estimated byapplying the 1.667 persons per household to the occupied housing unit projections.
Source: Santa Monica LUCE Final EIR, April 2010; Census 2010; and Economic & Planning Systems.
Nonresidential Development and Job Growth
The City's LUCE EIR forecast that the City's inventory of nonresidential building space related to
employment uses will increase from 28.2 million to 31.3 million square feet by 2030, a net
increase of 3.1 million building square feet. This net increase is based on a gross increase of 3.5
million square feet of nonresidential uses including office, retail, medical office, hospital, hotel,
institutional and a projected reduction of about 380,000 in industrial space. Using employee
density assumptions for each land use, the LUCE EIR forecast net employment growth of 7,724
jobs associated with new nonresidential development as shown in Table 3.
6 Page 4.10 -12 Santa Monica LUCE FEIR, Volume 1.
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Table 3 Employment and Projected Growth in Nonresidential Uses
Employment Uses
New Bldg.
Sq. Ft.
Sq. Ft. per
Employee
Employment
Growth
Office
448,980
275
1,633
Retail
566,803
425
1,334
Creative /Post- Production
699,709
275
2,544
Medical Office
187,327
500
375
Hospital
763,123
500
1,526
Hotel (Employees)
626,578
1,500
418
Institutional
196,029
300
653
Educational
0
300
0
Projected Growth (Gross)
3,488,549
8,483
Industrial
(379,137)
500
(758)
Projected Growth (Net)
3,109,412
7,724
Baseline Employment
100,949
Projected Growth (Gloss)'
88.483
Buildout(2030 Projection)
109,432
Change (2010 -2030)
8.4%
[1] The fee analysis excludes industrial space for purposes of showing gross new Sq. ft.
upon which.the fee would be assessed. To the extent that a project includes new sq. ft
that replaces existing industrial sq. ft. such a projectwould be eligible for fee credits.
Source: Santa Monica LUCE EIR, 2010,
Hotel Development and Overnight Visitor Growth
In addition to employment growth, hotel development will increase the City's visitors. With an
estimated inventory of 3,700 hotel rooms and occupancy rates over 80 percent, the City
maintains an overnight visitor population (hotel guests) of over 6,000, about 7 percent of the
City's resident population. New hotel development will generate new out -of -town overnight
visitors, Increasing the City's service population.
Table 4 shows the current hotel development and EPS's estimate of the associated overnight
visitor population. Based on the City's LUCE EIR projected growth in hotel square feet of
626,600, EPS estimates an increase of 3,540 in the associated, average visitor population by
2030. This estimate is based on the assumption that average occupancy rates and occupants
per room will remain consistent over the planning period.
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Table 4 Hotel Development and Projected Growth
Occupancy Rate (2012) 84.3% 84.3%
Estimate of Occupied Rooms 3,129 4,899 1,770
Avg. Persons /Room 2.0 2.0
Estimated Guest Population 6,258 9,798 3,539
[1] Projected hotel rooms derived bydividing projected total hotel square feetbyaverage
hotel room size of approx 298 sq. ft.; average room size calculated using citywide
hotel sq. ft. data from the LUCE EIR and hotel room inventory data from the Santa
Monica Convention and Visitors Bureau.
Source: Santa Monica 2010 LUCE ER; PKF Consulting; Santa Monica Convention &
Visitors Bureau; and Economic & Planning Systems.
- a
The City's existing resident population, employment, and visitor population related to hotels form
the basis for determining its baseline level of demand (service population) and inform the
estimate of current service standards for parks and recreation facilities. Building on the existing
and forecast estimates of population, employment, and visitors —the key drivers of parks and
recreation demand — described in the previous section, this section estimates the existing service
population and shows how growth in residents, employees, and hotel guests will increase the
service population and generate new demand for parks and recreation facilities.
Studies have shown that the degree or extent to which the three groups of park users (residents,
employees, and visitors) utilize parks is different; residents in general use parks at a higher level
than nonresident users. Therefore, to derive a comprehensive service population that combines
all parks users, residents, employees, and hotel guests, we need to express the demand
generated by each group on an equivalent basis.
Table 5 summarizes the service population estimates by user group under existing conditions
and projected growth. As shown, the City is estimated to have a baseline parks - related service
population of 110,865 that is forecast to increase by 10,123 or 9.1 percent by 2030.
The following sections describe the methodology and assumptions used to determine residence -
equivalency factors for each of the three user groups.
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Baseline
Buildout
2010 -2030
Item Description
2010
2030
Net Growth
Hotel Sq. Ft.
1,108,000
1,734,578
626,578
Hotel Rooms'
3,712
5,811
2,099
Occupancy Rate (2012) 84.3% 84.3%
Estimate of Occupied Rooms 3,129 4,899 1,770
Avg. Persons /Room 2.0 2.0
Estimated Guest Population 6,258 9,798 3,539
[1] Projected hotel rooms derived bydividing projected total hotel square feetbyaverage
hotel room size of approx 298 sq. ft.; average room size calculated using citywide
hotel sq. ft. data from the LUCE EIR and hotel room inventory data from the Santa
Monica Convention and Visitors Bureau.
Source: Santa Monica 2010 LUCE ER; PKF Consulting; Santa Monica Convention &
Visitors Bureau; and Economic & Planning Systems.
- a
The City's existing resident population, employment, and visitor population related to hotels form
the basis for determining its baseline level of demand (service population) and inform the
estimate of current service standards for parks and recreation facilities. Building on the existing
and forecast estimates of population, employment, and visitors —the key drivers of parks and
recreation demand — described in the previous section, this section estimates the existing service
population and shows how growth in residents, employees, and hotel guests will increase the
service population and generate new demand for parks and recreation facilities.
Studies have shown that the degree or extent to which the three groups of park users (residents,
employees, and visitors) utilize parks is different; residents in general use parks at a higher level
than nonresident users. Therefore, to derive a comprehensive service population that combines
all parks users, residents, employees, and hotel guests, we need to express the demand
generated by each group on an equivalent basis.
Table 5 summarizes the service population estimates by user group under existing conditions
and projected growth. As shown, the City is estimated to have a baseline parks - related service
population of 110,865 that is forecast to increase by 10,123 or 9.1 percent by 2030.
The following sections describe the methodology and assumptions used to determine residence -
equivalency factors for each of the three user groups.
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Table 5 Baseline and 2030 Projected Service Population
Population/ Residence
Employment Equivalency Estimated Service Population
Park User Group 2010 2030 Factors 2010 2030 Growth %Growth
Formula: a b c d =a *c a =b *c f =e - d g =f /d
Residents 89,736 97,631 1.00 89,736 97,631 7,895 8.8%
Hotel Guests' 6,258 9,798 0.15 939 1,470 531 56.6%
Employees2 100,949 109,432 0.20 20190 21886 1.697 8.4%
Total Service Population 110,865 120,987 10,123 9.1%
[1] Demand equiviency factor is based on a review ofamlable visitor park use studies fortifies throughoutthe U.S. The
percent of visitors indicating usage of parks in the Citywas assumed to be a reasonable indication of the use
equivalency relative to residents. The proportionate use byvistors varied considerably, though it tended to fall in the 10
to 30% range for cities with abroad inventory of parks. The results from a 2007 study for the San Diego Convention &
Visitors Bureau that specifically measured the share of overnight visitors that visited a park and recreation destination
during their stay in the Citywas viewed as most comparable and was used as the basis of the resident - equivalency
assumption for Santa Monica.
[2] Demand equivalency factor reflects the equivalency ass um ptions assumed in parks and recreation fee studies for the
cities of San Francisco and Palo Alto. These studies relied on Park User Intercept Surveys to measure park usage of
non- resident employees relative to residents. Other studies showed higher resident - equivalency factors for employees,
while others did not attribute anydemand for employees. if park user surveys are conducted in the future in the City of
Santa Monica, the equivalency factors would be updated.
Source: Santa Monica LUCE FEIR, April 2010; Census 2010; and Economic & Planning Systems.
Residents — Relative Demand and Service Population
For purposes of this study, demand equivalency is measured relative to park demand by
residents. Because residents, on average, typically demonstrate the highest levels of use of
public parks and recreation facilities, one resident is assigned a residence - equivalency factor of
1.0. This means that the existing and future growth in the service population related to City's
residents is equal to the existing and future growth in resident population, i.e., represents a
baseline service population of 89,736 and growth of 7,895.
Employees - Relative Demand and Service Population
Demand factors for other users, employees and hotel guests, would ideally be estimated by
surveying the City's park users and determining the usage of employees and hotel guests
relative to residents. In the absence of such primary data, results from surveys conducted in
other cities were considered. There is a limited amount of research measuring aggregate City
park use by employees relative to residents. Relevant studies were identified for the cities of
Glendale, Los Angeles, Redwood City, and Palo Alto, California, and Eugene, Oregon, several of
which specifically informed parks and recreation development impact fee studies (Glendale,
Redwood City, and Palo Alto). Other cities, such as San Francisco, made assumptions concerning
employee- resident equivalency based on studies conducted elsewhere (in this case in Arizona).
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And some cities ignored workers' use /demand for parks and recreation facilities and tied all
demand to residential development.
Applying results from other cities poses challenges for a number of reasons, including differences
in the amount of parks, differences in the proximity of parks to employment areas, and
differences in the propensity of the local workforce to access park amenities. Of the cities
reviewed, the conclusions from the Palo Alto, Glendale, Redwood City, and San Francisco were
considered most relevant based on the clarity of their data for impact fee purposes as well as
their California location, general employment characteristics and scale, and availability of parks.
Results from the Palo Alto study showed a resident - equivalency factor of 0.2 for an employee.
This means that the demand for parks generated by 1 employee was equivalent to one -fifth the
demand generated by a resident. The estimate was based on the number of employees using
parks relative to total employment in the City compared to the number of residents using parks
relative to the city's total population. The San Francisco study assumed a similar resident -
equivalency factor of 0.2. A similar methodology was used in the Redwood City study which
determined a resident - equivalency factor of 0.5 per employee, while the City of Glendale
identified a residency - equivalency factor of 0.45 per employee. Given this broad range of
equivalency factors of between 0.2 and 0.5 and the exclusive focus by some fee programs on
residential development, EPS has assumed a 0.2 resident - equivalency factor for Santa Monica
employees for the purposes of this study.
With existing employment of 100,949 employees and gross employment growth of 8,483, the
estimated factor of 0.2 implies a baseline service population of 20,190 and projected growth of
1,697 in the service population associated with the City's employment land uses.
Hotel Guests - Relative Demand and Service Population
Research on hotel guests' use of a city's parks is also limited. The Santa Monica Convention and
Visitors' Bureau conducts an annual survey of visitors to the City which among other things asks
which destinations the respondents visit during their stay in Santa Monica. However, the results
do not include visits to city parks among the identified destinations. Therefore, it was not
possible to isolate from the results, how likely hotel guests were to visit city parks relative to
other destinations /attractions during their stay. Data on visits to Santa Monica Pier, Santa
Monica Beach, and Pacific Park (on the Pier) was reported but is not applicable to this study
because these parks and recreation amenities are not part of the City's inventory of park
facilities.
The Trust for Public Land recently summarized the findings of a range of studies on the
propensity of visitors to use local parks and recreation facilities. Reported results from park use
studies at City parks from a diverse set of cities across several States (Delaware, Washington,
Colorado, California, and Pennsylvania) indicated that between 5 percent (Wilmington, Delaware)
and 40 percent (Philadelphia) of overnight visitors (for all purposes) visited the local parks. On
average, about 20 percent of overnight visitors who spent time in parks had come specifically for
the park amenities. Visitor studies in several cities —San Diego, Denver, and Seattle— indicated,
directly or indirectly, that between 15 and 25 percent of overnight visitors spent time in parks in
these cities.
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The results from studies conducted for the San Diego Convention and Visitors' Bureau and the
California Travel and Tourism Commission provided the most meaningful results for application
to this study. The San Diego study estimated the number of overnight visitors that visited parks
in the City. About 20 percent of overnight visitors were found to spend time in the City's parks
(including its beaches), with 5 percent in San Diego to visit the parks as their primary reason
and the remaining 15 percent of overnight visitors visited a park in the City, incidental to their
visit.' While San Diego is different from Santa Monica in many respects, amongst the available
studies of park use by visitors, we believe that as major Southern California tourist destinations,
San Diego provides the best current indicator of the likelihood for overnight visitors in Santa
Monica to visit a park.
Based on the above discussion, this analysis assigned a resident - equivalency factor of 0.15 to
hotel guests /overnight visitors. As a result, overnight visitors represent an estimated baseline
service population of 939 and a projected growth of 531 between 2010 and 2030.
7 Visitors whose primary purpose of travel was to visit a park (not incidental) most likely visit major
attractions such as Balboa Park in San Diego or Santa Monica Beach in Santa Monica. By looking only
at incidental visits, we discount the share of visits to major attractions that are not representative of a
regular city park.
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5. PARKS AND RECREATION FACILITIES AND COSTS
This chapter estimates the supportable level of parks and recreation capital facilities costs
funding that can be charged to new development under the new fee schedule, consistent with
the Mitigation Fee Act. The capital facilities cost allocation is based on existing service standards
and is divided into two primary components, for purposes of analysis, investments in parkland
acquisition and investment in parks and recreation improvements and facilities.
Existing Parkland and Current Ratio
According to data provided by the City's Community and Cultural Services Department, the City's
inventory of parks includes 29 community and neighborhood parks, a swim center, and a
community garden on approximately 131.4 acres of parkland. This total does not include park
acreage under joint -use with school districts and the State Beach. Including these two park
resources, the park acreage within the City and accessible to residents totals 392 acres.
Based on the 131.4 acres of City parkland alone, the existing service standard is 1.19 acres per
1,000 service population (resident - equivalents), as shown in Table 6.
Table 6 Estimated Required Parkland Investment to Serve New Growth
Item Description
Citywide Park Acres
Baseline Demand for Parks (resident - equivalents)
Existing Parkland Standard (Acres per 1,000 resident - equivalents)
2010 -30 Growth in Parks Demand
Required Parkland Acquisition for New Development (Acres)
Cost per Acre'
Total Parkland Acquisition Cost
Amount
131.4
110,865
1.19
10,123
12.0
$7,623,000
$91,476,000
(11 Land cost of$175 persq.ft. is based on a reviewofa number of recent appraisals conducted
for properties in the City of Santa Monica.
Source: City of Santa Monica; and Economic& Planning Systems.
New Parkland and Estimated Cost Required to Serve New Development
To maintain the existing service standard, the City will need to increase parkland by 12.0 acres
based on the projected growth in service population of 10,123. To identify planning -level
estimates of land acquisition costs, EPS interviewed City staff and reviewed recent valuation
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appraisals for properties in the City. The area of focus was the area bounded by Lincoln
Boulevard (west), Wilshire Boulevard (north), Centmela Avenue (east), and the Santa Monica
Freeway (south). This is the general area where future parkland acquisitions are most likely to
occur, as indicated by City staff. Based on these appraisals, EPS estimated an average land cost
of $175 per square foot or $7,623,000 per acre. As shown in Table 6, based on the projected
need for 12.0 acres and the per -acre land cost estimate, the total cost to acquire new parkland
to serve new development is approximately $91.5 million.
r r ri
Existing Facilities and Estimated Value
City staff developed inventory estimates of different City parks improvement by square footage
and associated planning -level estimates of current park improvement costs. Currently, the City
has over 5.7 million square feet of improved park area on 131.4 acres containing a wide range of
improvements and facilities including baseball fields, soccer fields, dog parks, basketball courts,
tennis courts, children's playgrounds, a skate park, a swim center, and community rooms. Other
facilities include accessory buildings such as maintenance facilities, and amenities such as
parking lots, restrooms, bathrooms and kitchens. Table 7 shows a summary of inventory and
replacement value for each facility type. As shown in the table, the City's inventory of park
facilities has a total estimated value of $378.6 million based on replacement cost.
Table 7 Cost Estimates of Existing City Parks & Recreation Facilities
General Improvement
Total Sq. Ft.
Cost per
Sq. Ft.
Total Cost
Courts
271,500
$160
$43,440,000
Dog Parks
113,700
$26
$2,842,500
Fields - Baseball
701,100
$29
$20,331,900
Fields - Soccer
135,000
$12
$1,620,000
Community Gardens
36,400
$13
$473,200
Park Parking Lots
475,125
$8
$3,801,000
Park Buildings
127,200
$378
$48,081,600
Parks
3,346,253
$55
$184,043,915
Park - Botanical Gardens
375,894
$117
$43,979,598
Playground
160,600
$55
$8,833,000
Skatepark
26,000
$35
$910,000
Swimming Pool Facility
52,300
$388
$20,292,400
Total Existing Park & Recreation Facilities
5,821,072
$378,649,113
Source: City of Santa Monica
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Required Growth in Facilities and Cost Allocation to New Development
In order to continue providing parks and recreation services at standards currently provided to
existing residents, the city's inventory of parks and recreation facilities will need to be increased
at a rate corresponding to the growth in demand generated by new development. As shown in
Table 5, demand for park and recreation services as measured by service population is forecast
to grow by 9.1 percent during the planning period. Based on the current estimated value of
$378.6 million, a 9.1 percent expansion of the existing inventory of facilities to accommodate
future demand from new development would cost an estimated $34.6 million, as shown in Table
8. This represents the fair share contribution required from new development to address the
impact of increased demand on park improvements (excluding parkland) and maintain existing
service standards.
Total Costs Associated with New Development
Table 8 also shows the total estimated investment in parks and recreation capital facilities (park
improvements and parkland) required to maintain existing standards of service. As shown, this
totals $126 million in 2013 dollars, including $35 million in parks improvements (27 percent) and
$91 million (73 percent) in land acquisition costs. This is the maximum, supportable fee - funded
cost for inclusion in the development impact fee program.
Table 8 Total Parks Fee Program Costs
Program Cost Items
Capital Facilitiesllmprovements
Value of Existing Parks & Recreation Facilities
Projected Increase in Parks Demand
Park Facility Improvements to Serve New Growth
Land Acquisition
Required Parkland Acquisition to Sere New Growth
Total Parks Fee Program Costs
Source: CityofSanta Monica; and Economic& Planning Systems.
Estimated
Costs
$378,649,113
9.1%
$34,573,315
$91,476,000
$126,049,315
Economic & Planning Systems, Inc. 21 v:u2z000u2lo77Sa�tamoni PadrsFee%Re onvZlmhepoa 6-1-13 cuenrdor
6. DEVELOPMENT IMPACT FEE CALCULATIONS By LAND USE
The maximum, supportable parks and recreation development impact fee schedule was
determined based on the development forecasts and relative parks demand by land use
identified in Chapter 4 and new development's fair share contribution to future parks and
recreation capital facilities estimated in Chapter 5. This chapter describes the technical steps in
estimating the maximum fee schedule.
Cost Allocation by Land Use
Total fee program costs are allocated to each land use category based on the contribution of
each land use to the total increase in parks demand as measured by service population. Table 9
shows the total service population increase of 10,123 associated with new development and the
relative distribution of resident - equivalents by fee category (detailed calculations of service
population by land use are shown in Table A -1 in Appendix A). For fee purposes,
nonresidential land use categories with similar employment densities (and hence fee levels) were
combined to simplify fee program implementation and administration. Specifically, office and
creative /post - production uses were combined as were medical office and hospital uses. For
overnight lodgings, resident - equivalent calculations combine service population associated with
both guests and employees.
Table 9 Distribution of New Service Population by Land Use Category
Fee Categories
Resident-
Equivalents'
%of
Total
Residential
7,895
78%
Nonresidential
Office & Creative /Post- Production
835
8%
Medical Office/ Hospital
380
4%
Retail
267
3%
Hotelz
614
6%
Institutional
131
1%
Total
10,123
100%
[1 ] See Table A -1 for calculation of resident - equivalents by residential and
employment uses.
[2] Resident - equivalents based on guests and employees.
Source: Cityof Santa Monica; and Economic& Planning Systems.
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As shown in Table 9, residential land uses are expected to account for 78 percent of the
projected increase in parks demand. Among the 22 percent of new parks demand associated
with nonresidential uses, office and creative /past - production uses account for 8 percent, medical
office /hospital uses account for 4 percent, and hotels /overnight lodging for 6 percent. Retail
uses account for about 3 percent of expected future parks demand and institutional uses (public
uses) for about 1 percent.
As shown in Table 10, total fee program costs are allocated to each land use category based on
these relative contributions to new park demand.
Table 10 Fair -Share Cost Allocation by Land Use Fee Category
Land Use Fee Categories
Cost
Allocation
Capital
Improvements
Land
Acquisition
Total Costs
Residential
78%
$26,965,743
$71,347,463
$98,313,206
Nonresidential
Office & Creative /Post- Production
8%
$2,853,268
$7,549,336
$10,402,604
Medical Office/ Hospital
4%
$1,298,471
$3,435,566
$4,734,036
Retail
3%
$910,995
$2,410,362
$3,321,357
Hotel
6%
$2,098,492
$5,552,306
$7,650,797
Institutional
1%
$446,346
$1,180,968
$1,627,314
Subtotal Nonresidential
22%
$7,607,572
$20,128,537
$27,736,109
Total Fee Program Costs
100%
$34,573,315
$91,476,000
$126,049,315
Source: City of Santa Monica; and Economic & Planning Systems.
Maximum Fee Estimates
The maximum, new parks and recreation development impact fee schedule was derived from the
above cost allocations by land use category and the forecast of new development. Specifically,
costs allocated to the residential land use category were divided by the projected number of new
units to estimate the maximum fee per residential unit, while costs allocated to nonresidential
uses were divided by the projected new building square feet for the respective land use category
to estimate the maximum fee per square foot.
As shown in Table 11, the maximum, supportable fees range from $16,554 to $30,543 per
residential unit and between $5.08 and $12.45 for future nonresidential development. This is
the fee schedule that under the current development forecasts would result in the generation of
$126 million in fee revenues (2013 dollar terms) between 2010 and 2030.
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Table 11 Estimated Maximum Parks Fee per Unit
[II The LUCE EIR does not provide breakdowns of future residential units by type as shown here. The
differences in fee levels by unit type are based on relative differences in persons per household.
Source: Santa Monica LUCE Final EIR 2010; Economic& Planning Systems.
The costs of establishing, monitoring, reporting, and updating the fee program can be included in
the development impact fee schedule. Actual funding requirements for these functions will vary
by year, though are typically estimated at about 2 percent of fee program capital facilities costs
in other fee programs throughout California. In addition, because institutional uses are primarily
public uses, they will not be charged a fee, with the loss of fee revenues being made up from
other funding sources. A fee for industrial development is also shown (set at the same rate as
medical office /hospital) based on its similar assumed square feet per employee. The City
expects a net loss in industrial development in the City, though the fee level is shown to support
estimates of fee credits in cases of redevelopment of industrial space. Table 12 shows the
resulting maximum fee schedule with administrative costs added and institutional uses removed.
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Costs per Unit
New
Capital
Land
Fee Categories
Growth
Improvements
Acquistion
Total Cost
Residential Uses
Units'
ep rUnit
ep rUnit
per Unit
Single Family Units
$8,213
$21,731
$29,944
Multi Family Units (Studio /1 bedroom)
$4,451
$11,778
$16,229
Multi Family Units (2+ bedrooms)
-
$7,169
$18,969
$26,138
Subtotal /Average Residential
4,955
$5,442
$14,399
$19,841
Employment Uses
Sg R.
per sq. ft.
per sq. ft.
per sq. ft.
Office & Creative /Post- Production
1,148,689
$2.48
$6.57
$9.06
Medical Office/ Hospital
950,450
$1.37
$3.61
$4.98
Retail
566,803
$1.61
$4.25
$5.86.
Hotel
626,578
$3.35
$8.86
$12.21
Institutional
196,029
$2.28
$6.02
$8.30
Subtotal Nonresidential
3,488,549
[II The LUCE EIR does not provide breakdowns of future residential units by type as shown here. The
differences in fee levels by unit type are based on relative differences in persons per household.
Source: Santa Monica LUCE Final EIR 2010; Economic& Planning Systems.
The costs of establishing, monitoring, reporting, and updating the fee program can be included in
the development impact fee schedule. Actual funding requirements for these functions will vary
by year, though are typically estimated at about 2 percent of fee program capital facilities costs
in other fee programs throughout California. In addition, because institutional uses are primarily
public uses, they will not be charged a fee, with the loss of fee revenues being made up from
other funding sources. A fee for industrial development is also shown (set at the same rate as
medical office /hospital) based on its similar assumed square feet per employee. The City
expects a net loss in industrial development in the City, though the fee level is shown to support
estimates of fee credits in cases of redevelopment of industrial space. Table 12 shows the
resulting maximum fee schedule with administrative costs added and institutional uses removed.
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Table 12 Maximum Development Impact Fee Estimates with Administrative Costs
Fee Categories Estimated Feel
Residential (Average)
$20,238
per Unit
Single Family Units
$30,543
per Unit
Multi Family Units (Studio /1 bedroom)
$16,554
per Unit
Multi Family Units (2+ bedrooms)
$26,661
per Unit
Nonresidential
Office/ Creative
$9.24
per Sq. Ft.
Medical Office/ Hospital
$5.08
per Sq. Ft.
Retail
$5.98
per Sq. Ft.
Hotel
$12.45
per Sq. Ft.
Industria12
$5.18
per Sq. Ft.
[1 ] Administrative costs estimated to add 2% to fee program cost (and fees).
[2] Set equal to hospital because of similar employee generation rates per Sq. It
Sources: CityofSanta Monica; Economic& Planning Systems, Inc.
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7. PARKS AND RECREATION FEE COMPARISONS
This chapter compares both the maximum, supportable development impact fees with the park
fees (including Quimby Act park in -lieu fees and parks and recreation development impact fees)
adopted in selected Los Angeles /Orange County and San Francisco Bay Area communities. The
purpose of this comparison is to inform City policy decisions concerning the adoption of a new
parks and recreation fee schedule. It also compares the maximum parks and recreation fees -
see Table i - with the fees in these other communities.
As new Statewide referenda and legislation have limited the funding sources for and increased
the difficulty of establishing local financing tools to fund capital facilities, Quimby Act park in -lieu
fees and Mitigation Fee Act development impacts have become increasing important sources of
parks and recreation funding in jurisdictions throughout California. Fee comparisons can provick
helpful context to City policymakers in understanding how others are using these fees to fund
parks and recreation facilities. In comparing fee schedules, there are, however, several
important considerations to bear in mind:
Other Sources of Capital Facilities Funding from New Development. A number of
California cities still rely, in part or predominantly on other sources of parks and recreation
facilities funding from new development, meaning that parks and recreation fee comparisons
do not always tell the full story concerning the relative contributions of new development. In
particular, some cities impose exactions on new development through conditions of approval
of development entitlements. In these cases, developers privately set aside parkland and
construct improvements and facilities which are dedicated to the City. These investments
can be substantial though do not show up in a formal development fee schedule.$ It should
also be noted that some cities have Quimby Act dedication requirements, but do not provide
an in -lieu fee alternative.
Differing Development Values. Different California cities command very different values
of new development based on both the demand for new development and the supply
constraints on new development. Cities with higher development values will, on average, be
able to carry a higher fee burden than those with lower development values, limiting the
utility of absolute fee level comparisons without a broader value context. Furthermore,
differences in parks and recreation fees, especially Quimby Act fees or the components of
Mitigation Fees associated with land acquisitions, will directly reflect differences in
development values /market strength as these fees are directly tied to land values.
8 Another example is the establishment of financing districts, such as assessment districts or
Community Facilities Districts (CFDs), can result in ongoing revenue streams from new development
that can be used to issue bonds to fund parks and recreation capital facilities.
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Differing City Priorities and Discounts. Different parks and recreation fee levels may
indicate different City priorities. For example, some cities may place a higher priority on
investments in parks and recreation facilities relative to other cities. A number of cities do
reduce their fees below the maximum, supportable fee levels, often in reference to fees
charged at other cities or concerns about impacts on development feasibility. In some cases,
the reductions relative to the maximum fee levels are phased -out over time, in some cases
they are maintained through time, and, in some cases, they are in exchange for the provision
of other public benefits.
Table 13 compares the one -time fees on new development for parks and recreation facilities
and land (Quimby Act, Mitigation Fee Act, and other) for selected jurisdictions. Table B -1 in
Appendix B provides additional detail on the fee programs, including the uses of the fee
revenues, the year the fee was established, and the effective date of the fee currently shown.
Fees for particular product types (single family residential, multifamily (condominium),
multifamily (apartment), and office development) are shown. The Quimby Act allows cities to
charge parkland fees on subdivided residential development (single family and condominium
development) based on the standard of three acres per 1,000 residents (and, in select cases, up
to five acres per 1,000 residents). As a result, many cities solely adopt Quimby Act fees. For
the City of Santa Monica, where much of the future development is expected to be multifamily
rental development and non - residential development, the Quimby Act would be of more limited
use and, furthermore, would result in fees on subdivided residential development substantially
above those under the Mitigation Fee Act approach.
The fee program information in Table 13 combined with a closer look at the nexus studies and
enabling ordinances and resolutions associated with some of the fees established under the
Mitigation Fee Act indicate the following:
City of Santa Monica parks and recreation fees for multifamily development would
be at the highest end of the range among cities surveyed if adopted at the
maximum, supportable level. At the maximum level of between $16,500 and $26,700 per
multifamily unit, the City of Santa Monica fee level would charge among the highest fees
among those cities surveyed for condominium and multifamily development. The City of
Santa Monica fee level would be above the base fee in the City of Pasadena for one - bedroom
condominium and apartment multifamily development ($16,400 per unit). It should be
noted, however, that the City of Pasadena fee schedule includes a range of exemptions and
discounts with discounts of up to 30 percent in market rate unit fees (fee reduced to $11,500
per unit for one - bedroom units) if all required inclusionary units are developed on -site.
Other discounts include potential 35 to 50 percent fee discounts on workforce housing and a
flat $756 per unit for the following housing types: low or moderate income units, skilled
nursing units, student housing residences, among others.
Economic & Planning Systems, Inc. 27 A: 121000p1210nsantaMonia Par sreekReportV21077mpon 8-1 -13 cueNrao«
Parks and Recreation Development Impact Fee Study
Report 08101113
Table 13 Comparison of Park Fees*
Cities
Single
Family
Multifamily
(Condo)
Multifamily
(Rental)
Office
Type of Fee
Unit Assumptions:
1,800sq.ft.,
850sq.ft.,
850sq.ft,
per sq. ff.
3 bdrms
1 bdrm
1 bdrm
Los Angeles/ Orange Counties
Beverly Hills
$12,780
$6,035
$6,035
$7.10
Special Tax
Glendale'
$6,370
$6,370
$6,370
$3.26
Mitigation /Quimby
Long Beach
$4,613
$3,563
$3,563
n/a
Mitigation
Manhattan Beach'
$1,817
$1,817
n/a
n/a
Quimby **
Newport Beach'
$26,125
$26,125
n/a
n/a
Quimby **
Pasadena
$20,981
$16,428
$16,428
n/a
Mitigation
Redondo Beach
$4,500
$4,500
n/a
n/a
Quimby **
West Hollywood
$5,380
$5,380
n/a
n/a
Quimby **
Los Angeles
$3,216
$3,216
$200
n/a
Quimby /Special Tax
San Francisco Bay Area
Palo Alto'
$10,410
$3,446
$3,446
$4.42
Mitigation
Fremont
$29,093
$19,668
$19,668
n/a
Mitigation/ Quimby Act
Fairfield
$10,409
$7,091
$7,091
n/a
Mitigation /Special Tax
Livermore
$13,334
$7,950
$7,950
$2.42
Mitigation
Concord'
$11,470
$9,914
$9,914
n/a
Quimby **
* Fee data from review of Cities' fee information and schedules posted online and interviews with Citystaff,
** Applicable to residential developments that require the preparation of a subdivision map. Typically,
apartment projects do not require a subdivision map and thus may not be subject to quimbyfees.
[1] Current fee will e )pire on 11/30/2013, adopted fee level effective 12/1/2013 is $10,500 /unit and $4.89/ office
sq. ft.
[2] Multifamily rental projects are exempt from Park fees in Manhattan Beach. In Newport Beach, the in -lieu fee
only applies to new residential subdivisions.
[3] Includes a constructiontaxof$ 200 /unit for impact mitigation purposes. Quimby portion is $3,016/unit.
[4] Multifamily units over 900 sq.ft. are charged $6,814 /unit. For residential subdivisions of50 units or more,
parkland dedication in -lieu fees of$52,909 /SFR
[5] Fee nexus is Quimby based, but fees are applicable to all residential development, including subdivisions
and individual permit approvals.
Source: Various California cities; Economic & Planning Systems, Inc.
Economic & Planning Systems, Inc. 28 PN21000U21077santanowra _P34�ree�R�onu2lm7repon 6- 1- 13cuemcdo«
Parks and Recreation Development Impact Fee Study
Report 08101113
Compared to the relatively small sample of the surveyed cities that charge parks
and recreation fees, the maximum City of Santa Monica parks and recreation fees
would be the highest relative to the cities surveyed. The maximum fees of $9.24 per
square foot for office /creative space would be higher than office fees for the surveyed cities
charging such fees (identified range of between $2.42 per square foot and $7.10 per square
foot for office development in other cities). This includes the City of Beverly Hills and the
City of Palo Alto.
The hotel fee appears to be relatively unique and, at its maximum level, particularly
high relative to the other cities surveyed. A number of cities with parks and recreation
development fees do not establish a unique hotel fee. In cases where such hotel fees are
applied they are often applied at a general commercial rate or are derived based on
employment generation alone. As described in this report, the use of employment
generation alone as the driver of hotel - related demand would miss the substantive use and
demand for parks from overnight visitors. In accounting for estimated overnight visitors and
their estimated propensity to use parks and recreation amenities, this fee study appropriately
ties the hotel fee level with service demand. The maximum fee recommended fee of $12.45
per square foot would the highest nonresidential development fees among all cities surveyed.
It should, however, be noted that many hotel developments are subject to Development
Agreements that may require exactions that will not be shown in formal development fee
schedules.
Economic & Planning Systems, Inc. 29 P.�121000�121077Sa„wnomW Pad5rF %Reponuumneport 6-1 13
Attachment C
Anilyze.Aclvise. Act.
700 South Flower Street, Suite 2730, Los Angeles, CA 90017
T: 310 -581 -0900 1 F: 310 -581 -0910 1 www.hiaadvisors.com
To: Karen Ginsberg, Andy Agle and David Martin
From: Paul J. Silvern and Remy Monteko
Date: April 24, 2014
Re: Estimates of Financially Feasible Tier 2 vs. Tier 1 Development Fees
Cc: Barry Rosenbaum, Esq. and Alan Seltzer, Esq.
Per your request, HR &A Advisors, Inc. (HR &A) has estimated the incremental increase in certain
development fees that could be charged to Tier 2 development projects in excess of the fees that
would apply to a Tier 1 project on the same site. The estimates include incremental increases in
the City's adopted Transportation Impact Fee (TIF), plus the proposed new parks and recreation
fee and affordable housing impact "linkage" fee. The estimates are based on a financial
feasibility analysis that had been completed for the new parks and recreation and affordable
housing linkage fees as applicable to six prototypical Tier 1 and Tier 2 developments, but prior
to a decision to utilize a fixed fee schedule for those new fees, plus an increase in the TIF, for Tier
2 developments, as part of the pending Zoning Code update. Accordingly, we utilized the upper
limit of financially feasible cumulative net new parks and recreation and affordable housing
linkage fees for the six prototypes, as determined by our completed work, to estimate of how the
fees total could be allocated between the three types of fees, assuming the same percentage
increase for all three fees between Tier 1 and Tier 2 prototypes.
Table 1 summarizes the resulting estimates. It shows that, according to the financial feasibility
thresholds utilized in our completed analysis, a uniform 14 percent increase for all three fees for
Tier 2 prototypes would be feasible. Table 1 includes information about the physical
characteristics of the six prototypes utilized in the analysis, and the resulting net amounts for each
fee, as well as the cumulative total of all three fees. It also expresses the net fees (individually
and cumulatively) as percentages of total development cost and dollars per square foot.
vs, Inc. I Los Angeles I Nlew Yovk ( Wcishing9on, D.O.
1
Table 1
Estimated Net Development Fees, Tier 1 vs. Tier 2, for Six Prototypical Developments in the City of Santa Monica
Wilshire Commercial
Downtown Commercial
Wilshire Mixed -Use
Tier 1
Tier 2
Tier 1
Tier 2
Tier 1
Tier 2
Gross Floor Area
39,000
57,750
45,111
76,222
40,125
59,521
Net Floor Area
" 33,750
50,625
39,250
67,250
33,750
50,625
1 st Floor Rata 11
20,800
20,800
18,000
18,000
4,400
4,400
Upper Floor Office
12,950
29,825
21,250
49,250
-
-
Residential
-
-
-
-
29,350
46,225
#Residential Units
-
-
-
-
° 40 G
64
# Market Rate
-
-
-
-
38
59
#Affordable
-
-
-
-
2
5
Total Development Cost
$20,765,062
$31,515,848
$29,519,207
$50,107,651
$20,815,283
$30,844,815
Tier 2 Fees Factor
1.00
1.14
1.00
1.14
1.00
1.14
Net TIF Fees Amount
Amount
$427,315
$632,341
$347,875
$657,885
$0
$0
% x Total Development Cost
2.1%
2.0%
1.2%
1.3%
0.0%
0.0%
$ per Gross Square Foot
$10.96
$10.95
$7.71
$8.63
$0.00
$0.00
$ per Net Square Foot
$12.66
$12.49
$8.86
$9.78
$0.00
$0.00
Net Parks & Rec Fee Amount
Amount
$44,192
$88,044
$59,179
$133,006
$177,343
$297,316
% xTotal Development Cost
0.2%
0.3%
0.2%
0.3%
0.9%
1.0%
$ per Gross Square Foot
$1.13
$1.52
$1.31
$1.74
$4.42
$5.00
$ per Net Square Foot
$1.31
$1.74
$1.51
$1.98
$5.25
$5.87
Net Linkage Fee Amount
Amount
$214,432
$405,884
$273,558
$595,871
$0
$0
% xTotal Development Cost
1.0%
1.3%
0.9%
1.2%
0.0%
0.0%
$ per Gross Square Foot
$5.50
$7.03
$6.06
$7.82
$0.00
$0.00
$ per Net Square Foot
$6.35
$8.02
$6.97
$8.86
$0.00
$0.00
Total All 3 Net Fees Amount
Amount
$685,939
$1,126,269
$680,612
$1,386,762
$177,343
$297,316
% xTotal Development Cost
3.3%
3.6%
2.3%
2.8%
0.9%
1.0%
$ per Gross Square Foot
$17.59
$19.50
$15.09
$18.19
$4.42
$5.00
$ per Net Square Foot
$20.32
$22.25
$17.34
$20.62
$5.25
$5.87
Prepared by., HR &A Advisors, Inc.
The details of the fee calculations are shown in Table 2. It is important to note that "net fee"
amounts reflect a fee credit for existing retail assumed at each site. The TIF fee credit for existing
retail in the Wilshire mixed -use prototypes cancels out the TIF at both Tier levels. Similarly, for the
affordable housing linkage fee, which applies only to the ground floor retail in the Wilshire
mixed -use prototypes, the fee credit cancels out the linkage fee. The parks and recreation fees
are based on 25 percent of the maximum justifiable fee, per the nexus study on which the fee is
based, and the affordable housing linkage fee is based on 4.5 percent of the maximum
justifiable fee according to its nexus study. These percentages of the maximum justifiable fees
were determined in the course of our completed analysis of those fees, as discussed below.
I-IR &A Aovlsoizs, hic.
2
Tier I vs. Tier 2 Development Fees 1 2
Table 2
Calculation Doing for EStherted TIFlNev2Parks 8 Recreation and Affordable Housing Linkage Fees, Tier l vs. Tier 2, for
Six Prototypical Devaloprrents in the Cifyof Santa Monica
Poototy, Name
Commertlal
Laalion
Wlstake
LULEFer
1
Land Area
22,500
Oross Bldg. Anne (SF)
3%M
Residential Lat.
-
MaMel Rate
1
St....
22,503
Lve
22,503
288
22,500
AffinaWe
45,111
1ER
49125
2BR
$2,6o per unit
R.admob.1(Net Leasable SF)
-
Retell (Net Leasable SF)
2QBW
Olfice(Net Leasable SF)
12,950
letel (Net ..table SF)
8
Floor Area Barnstable to Ter 2
$ -
Ofioa
$ -
Resldential
-
TmalUnas
$D. perunit
Meant Rate Unim
13
Sludlm
$ -
1ER
$ -
2AR
$21.00 xleasable abra
Affordable Lots
$ -
1AR
1
scum
$
Commertlal
Commercial
Commertlal
Mixed Uw
Mixed Use
WpsMre
Dr.[ m
00rmtc:m
Wlsblre
WAZMm
2
1
2
1
2
22,503
22,502
22,503
22,503
22,500
52,150
45,111
76,222
49125
59,521
$2,6o per unit
-
-
40
64
$ 313,166 $
504,638
Market Rate -Area 2
8
59
$ -
$ -
$ -
13
20
Affordable
$D. perunit
II -
13
20
$ -
$ -
$ -
12
$21.00 xleasable abra
$ -
$ -
$ 328,0.'13
1
2
$
Retail Area
$30.10 nIn ... his area
1
3
$ - 3
-
$ 132,440
29,350
46,225
20,890
la,0.V
18'.
4,400
4,400
29,825
21,250
49,250
-
-
14,912
$ -
28,003
-
$ -
1G605
24
zz
8
7
1
2
1
1
Assumed Existing Retail Floor Area
4.5%
22,500
22,500
22500
22,500
225.
22,500
Fee Factor
1.14
LOS
1.14
Lon
1.14
1.00
1.34
TIF Feess
38,624
Oree
45%
$224.11 xleasablearea
$ 130,6. $
322,052
$ 214,301
Market Rate -Areal
$2,6o per unit
-
SebtOtalFee
$ 313,166 $
504,638
Market Rate -Area 2
$3,300 perunit
$ -
$ -
$ -
$ -
$ 9B,&q
$ 205,033
Affordable
$D. perunit
II -
$ -
$ -
$ -
$ -
$ -
Retall-Ateal
$21.00 xleasable abra
$ -
$ -
$ 328,0.'13
$ 328,000
$ -
$
Retail Area
$30.10 nIn ... his area
$ 626,080
$ 626,080
$ - 3
$ -
$ 132,440
$ 132,440
Office -Areal
$9 .70 x leasable area
$ 214,432 $
405,604
5 203,125
$ 516,135
$
Office -Area 2
$10.00 xleasable area
$ 139,850
$ 344,886
$ -
5 -
S -
$ -
Hotel Are. 1A2
$3.60 x leasable area
5
S w
$
$ -
$ -
$
subtotal
L.ca ux eaopmanKOII
$ 165940
$ 970966
$ 584125
$ 864,135
$ 231240
$ 337,473
Less: Fee cn Existing SF Area 1
$23.00 x leasable area
$ (236.250)
S (236.250)
S 15.09 r
S 1819 r $
Less: Fee 6n Existing SF Arco 2
$30.30 x leasable area
5 (338.625)
S (336,625)
5 -
$
S (339,625)
S (338,625)
NIRT TIF Fee
$ 427.315
S 632.341
S 342,625
$ 65],885
$
S
Proposed PaMs/Recseatlon Fee
25%x Maximum Fees
adderadmilon
Market Rate Housing 25%
Ll Bits 25%
$16,554 per unit
$ -
$ -
$ -
$ -
$ 107,601
$ 124,319
2, BRs 25%
$26,661 per unit
$ -
$ -
$ -
$ -
$ 29,983
$ 133,238
Attend d Housing 25%
$D per unit
$ -
$
$ -
$ -
$ -
$ -
Retail 25%
S5 9B xleasable area
$ 31,036
$ 31,036
$ 2y910
$ 26,910
$ 6,578
$ 6$28
Oman 25%
$924 xleasablearea
$ 29,915
$ 23,262
$ 49,08
$ 122,935
$ -
$ -
HDIeI 25%
$1252 xleasablearea
5
$
$ =
5
$ -
$
Subtotal Fee
$ 61,011
$ I.A.
$ 75,998
$ 149,025
$ 194,162
S 314,135
Less: Fec on EnIle, SF
Retell 25%
$598 xleasable area
5 (16,819)
$ (161.19)
$ Hellub
$ (16,819)
$ (16,819)
$ (16,819)
.be. 25%
$924 ,leased. area
$
$
Is
$ -
5 -
$ -
Net Fee
$ 44,192
$ .8,044
$ 59.179
S FSAW
$ 177343
$ 297,316
Propowd Affordable Housing Linkage Fee
0.6 %xMUlmum Fees
T.%I Development Cast $ 20,165,062 $ 31,531,103 S 29,519,207 $ 0,107,651 5 20.815,283 5 30,662,301
Fees PSF $ 1].59 r $ 19.11 r S Leek, r $ 18.19 r $ 4.42' $ 5.29
Fee ae %13av Sao 3.3 %r SS%' 2.3 %r 2.8 %r 0.9%, t0%
Prepared by: HR$A Able, Inc
P &A ADVISORS, INC. Tier 7 vs. Tier 2 Development Fees 1 3
4.5%
assumption
Retail
4,5%
$19500 xleasablearea
$ 182,586 $
102,585
$ 158,.7
$ 158,001 $
3 8,624 $
38,624
Oree
45%
$224.11 xleasablearea
$ 130,6. $
322,052
$ 214,301
$ 536,618, $
- $
-
SebtOtalFee
$ 313,166 $
504,638
$ 322,312
Is 694,626 $
39.624 $
36,524
Less: Fee an Exacting SF
Retail
4.5%
$19502, leasable area
$ (98,154) $
(98.154)
$ (98,754)
$ (90,754) $
(98.754) $
(90,254)
Ofes
45%
$224.N xleasable area
5 5
$
$ - 3
S
net Fee
$ 214,432 $
405,604
$ 2131566
$ 595,071 S
- $
Combined New Fees with 14•A
Increase for Fen S
5 685,.9 $
1,125,269
$ 660,612
S Langs268 $
111.343 S
207,316
L.ca ux eaopmanKOII
S 20,765,062 5
311515.648
1 29,519,201
S 60.107,651 S 20,615,283 5
30,844,615
Fees PSF
S 12.59 r $
less,,
S 15.09 r
S 1819 r $
4.42 ' 5
SAO
T.%I Development Cast $ 20,165,062 $ 31,531,103 S 29,519,207 $ 0,107,651 5 20.815,283 5 30,662,301
Fees PSF $ 1].59 r $ 19.11 r S Leek, r $ 18.19 r $ 4.42' $ 5.29
Fee ae %13av Sao 3.3 %r SS%' 2.3 %r 2.8 %r 0.9%, t0%
Prepared by: HR$A Able, Inc
P &A ADVISORS, INC. Tier 7 vs. Tier 2 Development Fees 1 3
The modeling approach on which the completed analysis for the proposed parks and recreation
and affordable housing linkage fees are based, and hence the estimated fees presented in this
memo, is the same approach used by HR &A to analyze the feasibility of the adopted TIF. As in
the TIF analysis, computer models were prepared to simulate the financial feasibility implications
of developing and operating each development prototype after construction completion, without
and with the two new fees. The development cost profile for the prototypes includes, in addition
to all the usual hard costs, soft costs and construction financing, all of the typical current public fee
requirements, including other City planning and construction fees, fees for child care, the arts,
open space, the new TIF, and the Santa Monica - Malibu Unified School District's school facilities
fee, as applicable. For the mixed -use prototypes with housing, the City's affordable housing
requirements were addressed by including five percent of residential units at Extremely Low -
Income rents in the Tier 1 prototype, and 7.5 percent in the Tier 2 prototype. For the no new fees
scenarios, the analysis assumes that the current Parks and Recreation Facilities Tax and Housing
and Parks Mitigation Fees would continue to apply, as well as the adopted TIF.
One feasibility model takes the form of a "residual land value" analysis, in which the cost for land
that a developer could afford to pay in order to earn a market - responsive return on investment is
derived, rather than assumed. This model is then used to measure the cumulative impact of the
new fees on the amount that a developer could theoretically afford to pay for land. We then use
the derived land values in a second feasibility model to test the resulting return on total
development cost and developer profit margin, again without and with the two proposed new
fees.
HR &A derived maximum allowable fee amounts based on analysis that systematically tested each
of the prototypes with different levels of the two fees (i.e., different percentages of the maximum
justified fees per the nexus studies) using multiple financial feasibility metrics, such as change in
residual land value, developer profit, and return on total development cost, after the addition of
the proposed new fees, individually and cumulatively. The resulting fees (25 percent of the
maximum justifiable fee for the parks and recreation fee and 4.5 percent for the affordable
housing linkage fee) reflect levels at which financial feasibility for each of the prototypes was
pushed to the limit of specified feasibility thresholds.'
Appendix A includes the summary sheets for all four models in the completed analysis that form
the basis for the conclusions about uniform increases in Tier 2 fees as shown in Table 1 (i.e.,
residual land value with neither of the proposed new fees; return on total development cost with
neither of the proposed new fees; residual land value with both of the proposed new fees; return
on total development cost with both of the proposed new fees).
We conclude, therefore, that the new parks and recreation and affordable housing linkage fees,
if adopted at the percentages of the maximum justifiable fee amounts utilized in our analysis, and
These thresholds, which were also used in the TIF analysis, include: (1) up to a 20% change in residual land value
after addition of the new fees; (2) 10% developer profit margin and up to a 15% change in profit margin after
addition of the new fees); and (3) return on total development cost of 0.75 -1.00 over the weighted average cap
rate for the prototype and a change in return on cost up to 0.02 with the fees.
FIR &A ADVISORS, INC.
4
vs. Tier 2 Development Fees 1 4
the estimated Tier 2 versus Tier 1 increases as presented in this memo, could be absorbed by
developers of projects like the prototypes analyzed, and result in financially feasible projects.
These results are sensitive to all of the assumptions used in the analyses described in this memo.
Changes in some of these assumptions, particularly leasable floor areas, hard construction costs,
rents and income capitalization rates, or the assumed new fee credits for replacement of existing
retail uses, could alter these results.
All dollar amounts presented in this memo and the underlying proposed new fees analysis are
stated in 2014 dollars, without inflation.
We are available to answer any questions that you may have about the estimates presented in
this memo.
H R &A Aovisoits,
5
Tier 1 vs. Tier 2 Development Fees 1 5
Appendix A:
Summary Sheets for Four Models Testing the Feasibility of Proposed New Development Fees
INC. Tier 1 vs. Tier 2 Development Fees 1 6
Residual Land Value
Results Summary - Tier 1 & 2 Development Prototypes (No Add'I Fees)
Plagues Summary, (see App. A)
Prototype Name
$
Commercial
Commercial
$
Commercial
S
Commercial
$
Mixed Us.
S
Mixed Use
LocaGOn
Wishire
Wilshire
Dmtntmvn
D.a vn
Wilshire
Wilshire
LUCEner
1
2
1
2
1
Residential Markel Rate
2
Permit Requirement
Not
$
-
#Parcels
S
3
$
3
$
3
$
3
Cap Rate
3
5.30%
3
Bldg. Height (Feet)
5.30%
32
5.30%
50
5.30%
32
5.30%
60
$
32
$ -
50
Stories(g)
$
2
$
3
$
2
Residential - Affordable
4
2
4
Site Arda(SF)
22,500
22,500
22,500
$
22,500
$ -
22,500
-
22,560
Gross Bldg. Area (SF)
S
39,000
$
5],]50
Cap R.I.
45,111
5.30%
76,222
40,125
59,521
Floor Area Ratio(FAR) - Gross Area
5.307.
133
5.30%
2.57
$
2.00
$ -
339
-
13e
-
2.05
Floor Area Put. (FAR) -Net Area
$
1.50
Retail
2.25
194
2.99
1.50
225
Net Leasable Areas
NOI
$
920,026
$ 920,026
S
1,044,981
$
1,044,981
$
194,621
$
Residential RIF)
Cap Rate
-
6.60%
-
-
-
29,350
46,225
Market Rate Units
S
-
5 13,939,788
-
15,833,045
-
15,833,045
-
2,948,803
38
2,948,803
59
Affordable Units
-
-
-
-
2
Not
6
Total Units
S 1,339,160
-
1,083,561
-
2,512,111
-
-
-
-
40
64
Retail (SF)
20,600
20,800
18,000
18,000
Value
4,400
9,092,656
4,400
Office (SF)
16,930,641
12,950
39,251,734
29,825
-
21,250
-
49,250
$
-
$ 34,834,163
-
H t 1 SIF)
$
55084779
$
22786878
$
-
Residual Land Value Estimate
-
-
-
Development Costs (see App. B &C &0)
Total Project Value
$
23,032,444
$ 34,864,163
$
32,763,686
$
Land Costs
see Residual Value
see
Residual Value
see Residual Value
see Residual Value
see
Residual Value
s ee Residual Value
Hard Costs
$
11,878,402
$
18,522,996
$
14,115,638
$
25,226,136
$
7,730,679
5
12,072,482
Soft costs
$
1,475,198
$
2,29],5]1
S
1,]4],108
$
3,118,269
$
1,125,843
$
1,]54,]07
Net Parks/Recreation Fee
It
$
$:
Total
$
4,765,180
$
S
5
$
Net Affordable Housing Linkage Fee
$
-
$
13,877,599
$:'
$
$285
$
$455
$
$689
TIF Fee
$
427,315
$
609,565
$
347,875
$
619,475
$
-
$
-
OfturCilyCosts (seeApp.E)
$
408,948
$
806,571
$
536,303
$
1,125,402
$
321,058
S
543,004
Other Soft Costs
0
0
0
0
0
0
Financing Costs
$
1198345
$
1865920
$
1666335
$
2,601,954
$
852,004
S
1.315.511
Total Development Cost
$
15,388,208
$
24,102,623
$
18,433,259
$
32,691,236
$
10,029,584
$
15,685,854
per GSF
$395
3417
$409
$429
$250
$264
Net Operating Income (N01) (see App. E)
Residential MareA Rate
Effective Gross income
$
-
$
-
$
-
S
-
$
1,322,014
S
2,058,361
Less: Operating Expenses
$
-
S
-
$
-
S
-
$
(288000)
S
(413,0001
Net Operating income
$
-
5
-
5
-
$
-
$
1,058,014
$
1,645,361
Residential- Affordable
Effective Gross Income
$
-
$
-
$
-
$
-
S
9,510
$
24,053
Less: Operating Expenses
$
-
$
$
-
$
$
(14,000)
$
(35,00
Net Operating Income
S
-
$
-
$
-
$
-
$
(4,490)
$
(10,947)
Retail
Elected Gress income
$
948,480
S
948,480
$
1,0]],300
$
1,077,300
$
200,640
$
200,640
Less: Operating Expenses
$
(28454)
$
(28,4541
$
(32,319
$
(32,319)
$
(6,01
$
(6.019)
Net Operating Income
$
920,026
$
920,026
$
1,044,981
$
1,044,981
$
194,621
$
194,621
Office
Elective Gross Income
$
649,201
$
1,492,873
$
1,197,285
$
2,776,584
$
-
$
-
Less :Operating Expenses
$
(19,4]87
$
(44,7867
$
(35.919)
$
183,29
$
-
$
Net Operating Income
$
581,930
$
1,339,160
$
1 083,561
$
2,512,111
$
-
$
-
Total Net Operefinut Income
$
1,501,956
2,269,186
$
2128542
S
3557092
$
1246145
S
1,829,035
Project Component Values (see App. F)
Residential Markel Rate
Not
$
-
$ -
S
-
$
-
$
1,056,014
$
1,645,361
Cap Rate
5.30%
5.307.
5.30%
5.30%
5.30%
5.30%
Value
$
-
$ -
$
-
$
-
$
19,924,792
$
31,044,547
Residential - Affordable
NOI
$
-
$ -
$
-
5
-
S
(4,490)
$
(10,947)
Cap R.I.
5.30%
5.30%
530%
5.30%
5.307.
5.30%
Value
$
-
$ -
$
-
$
-
$
(84,717)
$
(206,547)
Retail
NOI
$
920,026
$ 920,026
S
1,044,981
$
1,044,981
$
194,621
$
194,621
Cap Rate
6.60%
6.60%
5.60%
6.60%
6.60%
6.60%
Value
S
13,939,788
5 13,939,788
$
15,833,045
$
15,833,045
$
2,948,803
$
2,948,803
Once
Not
$
581,930
S 1,339,160
$
1,083,561
$
2,512,111
$
-
$
-
Cap Rate
6.40%
8.40%
6.40%
6.40%
6.40%
6.40%
Value
$
9,092,656
$ 20,924,375
$
16,930,641
$
39,251,734
$
-
$
-
Total P tVal ,
$
23,032,444
$ 34,834,163
$
32763686
$
55084779
$
22786878
$
33.786,803
Residual Land Value Estimate
Total Project Value
$
23,032,444
$ 34,864,163
$
32,763,686
$
55,084,779
$
22,]88,8]8
$
33,786.803
Lerin Developer Profit
$
(2,879,056)
$ (4,358,020)
$
(4,095,461)
S
(6,865,597)
$
(2,848,610)
$
(4,223,350)
Less: Total Development Cost
$
(15388 208)
$ (24.102,623)
$
(18433259)
$
(32,691.236)
$
(10,029,584
$
(15,68$854)
Resldual Land Value
Total
$
4,765,180
$ 6,403,520
S
10,234,966
$
15,507,946
S
9,910,684
S
13,877,599
Per SF Land Area
$212
$285
$455
$689
$440
5617
Within Market Range?
Marginal
Yes
Yes
Yes
Yes
Yes
HR &A Advlsars, Inc,
Page 018 Task Tier l&2 RLV No Feesv3alsd8ummary
9 4 -24 -14
Return ml Cost
Results Summary -Tier 1 & 2 Prototypes (No Adel Fees)
Progrem Summary (see App. A)
Prototype Name
Location
LUCE Tier
Permit Require and
k Parcels
Bldg. Height (Feet)
Studies(#)
Site Ame SF)
Gross Bldg. Area (SF)
Floor Area Raga (FAR) -Gross Area
Floor Area Rage (FAR) - Net Area
Net Leasable Areas
Residential (SF)
Market Rate Units
Affordable Units
Total Units
Retail (SF)
Office (SF)
Commercial Commercial Commercial Commercial Mixed Use Mixed Use
Wishire Wilshire Oowntovm Dovmtcvm Wlshire Wishire
1 2 1 2 1 2
3
3
3
3
3
3
32
50
32
60
32
50
2
3
2
4
2
4
22,500
22,500
22,500
22,500
22,500
22,500
39,000
5],]50
45,111
76,222
40,125
59,521
1.73
2.57
2.00
3.39
1 .78
2.65
1.50
2.25
1.74
2.99
1.50
2.25
-
2,297,571
-
-
29,350
46,225
$
1,125,634
$
.1,]54.78]
38
59
$
g
2
5
-
-
-
-
40
64
20,800
20,800
18,000
18,000
4,400
4,400
12,950
29,825
21,250
49,250
-
-
Development Costs (see App. B&C &D)
Land Casts
$
4,765,180
$
6,403,520
$
10,234,966
$
15,507,946
$
9,910,684
$
13,8]],599
Held Costs
$
11,878,402
$
18,522,996
$
14,115,636
$
25,226,136
$
7,730,679
$
12,072,482
Soft Costs
5
1,475,198
$
2,297,571
$
1,]4],108
$
3,118,261
$
1,125,634
$
.1,]54.78]
Not ParkslRecreation Fee
$..
$
g
$
$
$
Net Affordable Housing Linkage Fee
15
$
$
is
_
g
$.::
Net TIF Fee
$
427,315
$
609,565
It
347,875
$
619,475
$
$
Other City Costs (see App. F)
$
408,940
$
806,571
$
538,303
$
1,125,126
$
320,782
$
543,004
Other Soft Costs
$
-
$
-
$
$
$
-
$
Financing Costs
$
1.525356
$
23D5361
$
2.171070
$
3666167
$
1.532105
$
2,267931
Total Development Cost
$
20,480,399
$
30,945,584
$
29,152,968
$
49,263,111
$
20,620,084
$
30,515,803
per GSF
$525
$536
$646
$646
$514
$513
Net Operating income (NOI) (see App. E)
Residential - Market Rate
Etlecilve Grass income
$
-
$
_
$
-
$
-
$
1,322,014
$
2,058,361
Less: Operating Expenses
$
$
$
$
$
(266 0001
$
(413 0001
Net Opemling Income
$
$
-
$
-
$
-
$
1,056,014
$
1,645,361
Residential - Affordable
Effective Gross Income
$
-
$
-
$
-
$
-
$
9,510
$
24,053
Less: Operating Expenses
$
-
$
-
$
$
$
(140001
$
(350001
Net Opemgng income
$
-
$
-
$
-
5
-
$
(4,490)
$
(10,947)
Retail
Effective Gross Income
$
948,480
$
948,460
$
1,0]],300
$
1,0]],300
$
200,640
$
200,640
Less: Ossining Expenses
$
(284541
$
(28.4541
$
(323191
$
(32319)
$
(60191
$
(6019)
Net Operating income
$
920,026
$
920,D26
$
1,044,981
$
1,044,981
$
194,621
$
194,621
Office
Effective Gross Income
$
649,201
$
1,492,873
$
1,197,285
$
2,]]6,584
$
-
$
-
Less :Operating Expenses
$
(6]2]1)
$
(153,713
$
(113.7241
$
L26447
$
5
Net Operating income
$
581,930
$
1,339,160
$
1,083,561
$
2,512,111
$
-
$
-
Hotel
Effective Gross income
$
-
$
$
-
$
$
$
Less: Operating Expense.
$
-
$
$
$
$
$
Net Operating Income
$
-
$
-
$
-
$
-
$
-
$
-
TotdlNetOperatingincome
It
1501956
$
2,269,186
$
2,128,542
11,
3,557,092
$
1,246,145
$
1,829,035
Project Component Values (see App. F)
Residentia6Manut Rate
NOT
$
-
$
_
$
-
$
-
$
1,056,014
$
1,645,361
Cap Rate
5.30%
5.30%
- 5.30%
5.30%
5.30%
5.30%
Value
$
-
$
-
$
-
$
-
$
19,924,792
$
31,044,547
Residential Afiprdable
Not
$
-
$
-
$
-
$
-
$
(4,490)
$
(10,947)
Cap Rate
5.30%
5.30%
5.30%
5.30%
5.30%
5.30%
Value
$
-
$
-
$
-
$
-
$
(84,]1])
$
(206,547)
Retail
NOI
$
920,026
$
920,026
$
1,044,981
$
1,044,981
$
194,621
$
194,621
Cap Rate
6.60%
6.60%
6.60%
6.60%
6.60%
6.60%
Value
$
13,939,788
$
13,939,788
$
15,833,045
$
15,833,045
$
2,948,8[3
$
2,940,803
Office
NOI
$
584,930
$
1,339,160
$
1,083,561
$
2,512,111
$
-
$
-
Cap Rate
6.40%
6.40%
6.40%
6.40%
6.40%
6.40%
Value
$
9,092,656
$
20,924,375
$
16,930,641
$
39,251,734
$
-
$
-
Hotel
NOI
$
-
$
$
-
$
-
$
$
Cap Rate
7.90%
7.90%
7.90%
7.90%
7.90%
7.90%
Value
$
$
-
$
$
$
-
$
Total Protect Value
$
23.032,444
$
34,864,163
$
32763686
$
55084]]9
$
22788878
9
33768603
Developer Returns
Developer Profil
Total Project Value
$
23,032,444
$
34,864,153
$
32,763,686
$
55,084,779
$
22,786,878
$
33,786,803
Less: Total Development Cost
$
(20.480399)
$
(309455841
$
(29152960)
$
(49.2631117
$
(20620084)
$
(305158037
Pmfit
$
2,552,045
$
3,918,579
$
3,610,718
$
5,821668
$
2,168,794
$
3,2716DD
%of Value
11.1%
11.2%
11.0%
10.6%
9.5%
9.7%
Feasible?
Yes
Yes
Yes
Yes
Yes
Yes
Return an Total Development Cost
NOI
$
1,501,9%
$
2,259,186
$
2,128,542
$
3,557,092
$
1,246,145
$
1,829,035
Total Development Cost
$
(20,480,399)
$
(30,945,584)
$
(29,152,968)
$
(49,263,111)
$
(20 620,084)
$
(30,515,803)
Return on Cost
7.33%
7.30%
7.30%
7.22%
6.04%
5.99%
Feasible? Yes Yes Yes Yes Marginal Marginal
HR&AAdrisols, ke,
Page t of 8 Test Tier I & 2 ROC No Feese1turmummary
- 242014
Residual Land Value
Results Summary - Tier ] 8 2 (With All Fees)
Program Summary (see App. A)
Prototype Name
$
Commercial
Commercial
2,259,185
Commercial
Commercial
$
Mixed Use
Mixed Us.
Location
S
Wilshire
Project Component Values (see App. F)
Wlshire
Dovmt.
Dment.
Wlshire
Wilshire
LUCETier
1
2
1
2
1
2
Permit Requirement
NOI
$
-
5
-
$
-
N Parcels
-
3
1056,014
3
1,645,381
3
3
3
3
Bldg. Height (Fast)
32
50
32
Value
60
-
32
50
Stones ph
-
2
-
3
19,924,792
2
31,044,547
4
2
4
Site Area (SF)
22,500
22,500
22,500
22,500
NOI
22,500
22,500
Gross Bldg. Am.g3F)
-
39,000
-
5],]50
-
45,111
(4,490)
76,222
(10,947)
40,125
59,521
Floor Area Ratio(FAR) - Gross Area
1.73
2.57
2.00
339
1.78
2.65
Floor Area Rate(FAR) - Net Area
-
1.50
-
2.25
-
1 .74
-
2,99
(84,]17)
1.50
2.25
Net Leasable Areas
Residential (SF)
NOI
-
920,028
-
920,026
-
1,044,991
-
1,044,981
29,350
46,225
Market Rate Units
194,621
-
-
-
-
38
59
Affordable Units
-
Value
-
13,939788
-
13,939,788
-
15,833,045
2
5
Total Units
2,948,803
-
2,948,803
-
-
-
40
64
Retail (SP)
20,800
20,860
NOI
18,000
581,930
18,060
1,339,160
4,400
4,400
Office(SF)
2,512,111
12,950
-
29,825
-
21,250
49,250
-
-
Hotel SF
6,40%
6.40%
6.40%
Value
$
9,092,656
$
20,924,375
5
16,930,641
$
39,251,734
$
-
$
-
Total Project Value
$
23,032,444
$
Development Costs (see App. B &C &D)
5
32,763,686
$
55084]]9
$
22788878
$
33,786,803
Land Costs
see Residual Value
see
Residual Value
a ee
Residual Value
see
Residual Value
see
Residual Value
see Residual Value
Hard Costs
$
11,878,402
$
18,522,996
$
14,115,638
S
25,228136
$
7,730,679
$ 12,072,482
Son Costs
S
-
5
-
$
-
S
-
$
22,]88,8]8
$
Net Parkehilm ugicui Fee
$
5: 214,43E
IS
r <437,]8]
$
-- '273,558
-$
'627,953
$
-
I$ -
NetAHOrdable Housing Linkage Fee
$
14,192
$
°. 94,172
'$
` 59,179
' $
139,334
$
1]],343
$ 314,802
TIF Fees
$
427,315
$
609,565
$
347,875
$
619,475
$
-
$ -
OtherCity Corbs (see App. E)
$
408,948
$
806,571
S
536,303
$
1,125,402
$
321,058
$ 543,004
Ocher Soft Costs
$
1,482,957
S
2,313,530
$
1,757,091
$
3,141,288
$
1,131,163
$ 1,78.231
Financing Costs
5
1216626
$
1,903.520
$
1,709,854
$
2,653,189
$
664,539
$ 1337833
Total Development Cost
$
15,672,872
$
24,688,141
$
18,799,498
$
33,535,7]]
$
10,224,782
$ 16,032,352
per GSF
- $388239
$402
- $844,541
$428
- $195,198
$417
- $346,498
$440
$255
$269
-9.1%
-3.6%
-5.4%
-2.0%
-2.5%
Within Market Range?
Yes
Net Operating Income (NOI) (see App, E)
Yes
Yes
Yes
Yes
Yes
Residential Market Rate
Effective Gross Income
$
-
$
-
$
-
$
-
$
1,322,014
$ 2,058,361
Less: Operating Expenses
$
-
$
-
$
-
$
-
$
(2613.000)
$ (4130007
Net Operating Income
$
-
$
-
5
-
$
-
$
1,056,014
$ 1,645,361
Residential- Affordable
Effective Gross Income
$
-
$
-
$
-
$
-
$
9,510
$ 24,053
Less: Operating Expenses
$
-
$
-
$
-
$
$
(14,000)
S 135,400)
Net Center, Income
$
-
$
-
S
-
$
-
$
(4,490)
$ (10,947)
Retail
Eff,dW. Gross income
$
948,486
$
948,480
$
1,0]],300
$
1,077,300
S
200,640
$ 200,640
Less: Operating Expenses
$
(28454)
$
(28,45
$
(32,3191
$
(332,31
$
(6,019)
$ L6,019
Net Operating Income
$
920,026
$
920,028
$
1,044,981
$
1,044,981
$
194,621
$ 194,621
Office
Effective Gross income
$
649,201
$
1,492,873
$
1,197,285
$
2,776,584
$
-
$ -
Less :Operaling Expenses
$
(19,47
$
(44.786)
5
(35,919)
$
(83,298
$
$ -
NetOperatinginwme
$
581,930
$
1,339,160
$
1,083,561
$
2,512,111
$
-
$ -
Total Met Operafflnu Income
$
1,501,956
$
2,259,185
$
2128542
$
3557092
$
1,246,145
S
1.829035
Project Component Values (see App. F)
Residential Market Rate
NOI
$
-
5
-
$
-
5
-
S
1056,014
$
1,645,381
Cap Rate
5.30%
5.30%
5.30%
5.30%
5.307.
5.30%
Value
$
-
$
-
$
-
S
-
$
19,924,792
$
31,044,547
Residential Affordable
NOI
$
-
$
-
$
-
5
-
$
(4,490)
S
(10,947)
Cap Rate
5.30%
530%
5.30%
5.30%
5.30%
5.30%
Value
$
-
S
-
5
-
5
-
S
(84,]17)
$
(206547)
Retail
NOI
$
920,028
S
920,026
$
1,044,991
$
1,044,981
$
194,621
$
194,621
Cap Rate
6.6017a
660%
660%
660%
6.00%
660%
Value
S
13,939788
$
13,939,788
$
15,833,045
$
15,833,045
$
2,948,803
$
2,948,803
Office
NOI
$
581,930
$
1,339,160
S
1,063,561
$
2,512,111
$
-
5
-
Cap Rate
RAW
6.40%
6.40%
6,40%
6.40%
6.40%
Value
$
9,092,656
$
20,924,375
5
16,930,641
$
39,251,734
$
-
$
-
Total Project Value
$
23,032,444
$
34864163
5
32,763,686
$
55084]]9
$
22788878
$
33,786,803
Residual Land Value Estimate
Total Project Value
$
23,032,444
$
34,864,163
$
32,763,686
$
55,084,]]9
$
22,]88,8]8
$
33,785,803
Less: Developer Profit
$
(2,879,056)
$
(4,358,020)
$
(4,095,461)
$
(6,885,597)
$
(2848,610)
5
(4,223,350)
Less: TmsI Development Cost
$
(15,6]2,8]2)
$
(24,688.141)
$
(18,]99,4987
$
(33,535,7777
$
(10.224.782)
5
(180323527
Residual Land Value
Total
$
4,480,516
S
5,818,002
$
9,868,727
$
14,663,405
$
9,715,486
$
13,531,101
Per SF Land Area
$199
$259
$439
5652
$432
5601
Residual Land Value No Fees
$4,765,180
$6,403,520
$10,234,966
$15,507,946
$9.9101684
$13,877,599
Change in Residual Land Value
- $284,664
- $585,518
- $388239
- $844,541
- $195,198
- $346,498
Percent Change in Residual Land Value
46.054
-9.1%
-3.6%
-5.4%
-2.0%
-2.5%
Within Market Range?
Yes
Yes
Yes
Yes
Yes
Yes
HR &A Advisois, Inc.
9 Test Her 1 & 2 RLV WN FeecV3.4s emmmary
Page 1 of 8 4 -24 -2014
Return on Cost
Results Summary -Tier i & 2 Development Prototypes (Will, Add'l Fees)
Program Summary (see App. A)
Prototype Name
Commercial
$
Cone l
$
Cammercal
$
Gommeoalal
$
Mixed Use
Mixed Use
Location
Change in Profit
Wilshire
Wilshire
Dovmlovm
Dovminwn
Wlshire
Wilshire
LUCETIer
Feasible?
1
Effective Gross Income
2
-
1
-
2
1
2
Pound Requirement
1,322,014
$
2,058,361
Less: Operating Expenses
$
$
$
$
#Parcels
$
3
$
3
Net Operating Income
3
-
3
-
3
3
Bldg. Height (Fast)
-
32
1,056,014
50
1.645,361
32
$
60
$
32
50
stories (it)
Return on Cost
2
3
2
Effective Gross Income
4
-
2
4
Site Area (SF)
-
22,500
22,500
9,510
22,500
24,053
22,500
$
22,500
22,500
Gross Bld, Area RE)
$
39,000
$
5])50
$
45,111
$
76,222
Net Operating income
49125
59,521
Floor Area Ratio(FAR) - Gross Area
-
1.73
-
2.57
-
2.00
(4,490)
339
(10,947)
1.78
2.65
Floor Area Ratio(FAR) - Net Area
1.50
2,25
1 .74
2.99
1.50
2.25
Net Leasable Areas
948,480
$
948,460
$
1,0]],300
$
1,077,300
$
200,640
$
200,640
Residenlial(BE)
$
-
$
-
$
-
$
-
$
29,350
46,225
Market Rate Units
Net Operalin9 Income
$
920,026
-
920,026
-
1,044,981
-
1,044,981
30
59
Affordable Units
194,621
-
-
-
2
5
Total Units
-
Effective Gross In..
-
649,201
$
1,492,873
-
1,197,285
40
64
Retail (SF)
-
20,80D
-
20,800
$
18,000
$
18,000
$
4,400
4,400
Office, (BE)
$
12,950
$
29,825
Net Operating Income
21,250
561,930
49,250
1,339,160
-
1,083,561
Hotel (SFl
2,512,111
S
-
$
-
Hotel
76,250
Development Costs (see App. 8 &C &D)
Effective Gross income
$
-
$
-
Land C.Sts
$
4,7651180
$
6,403,520
$
10,234,968
$
15,507,946
$
9,910,6M
$ 13,8]],549
Hard Casts
$ ,
11,878,402
$
18,522,996
$
14,115,638
$
25,226,136
$
7,730.679
$ 12,072,482
Suitcases
$
1,482,957
$
2,313,530
$
1,]5],091
$
3,141,279
$
1,131,155
$ 1,764,231
Net Pads) #]nation Fee
It
°- 44,192
$
94,172:
It
59,179
It
"139,334
$
1]],343
$ 314,802
Net Affordable Housing Linkage Fee
$
214,432
$
437,787
:.$
273,558
It
- 627,953
$
-
HE Fee
$
427,315
It
'609,565
It
'347,615
$
619,475
$
-
$ -
Olhef City Costs (sea App E)
$
408,948
$
806,571
$
536,303
$
1,125,126
$
320,782
$ 543,004
Other Soft Costs
$
Cap Rate
$
5.30%
$
-
$
5.3D%
§
5.30%
$ -
FinandrigCosls
$
1,543636
$
2,342,962
$
2194597
$
3,720,402
$
1,644,640
$ 2,290,183
Total Development Cost
$
20,765,062
$
31,531,103
$
29,519,207
$
50,107,651
$
20,815,283
$ 30,662,301
per GSF
$532
$546
NOI
$654
$657
-
$519
$519
Net Operating Income (NOI) (see App. E)
pO[,v40
$
b,916,om
$
I3BIU,716
$
5,821,668
$
2,160,794
$
3,271,000
Change in Profit
Residential - Modest Rafe
-14.0%
-10.1%
14.5%
40%
- 10.6%
Feasible?
Yes
Effective Gross Income
$
-
$
-
$
$
$
1,322,014
$
2,058,361
Less: Operating Expenses
$
$
$
$
$
1266000)
$
(413,000)
Net Operating Income
$
-
$
-
$
-
$
-
It
1,056,014
$
1.645,361
Residential Affordable
$
(50,107,651)
$
(20,815,283)
5
(30,862,301)
Return on Cost
7.23'%
7.16%
7.21%
Effective Gross Income
$
-
$
-
$
-
$
$
9,510
$
24,053
Less: Operating Expenses
$
6L4%
$
580%
$
40.10%
$
-0.14%
$
(14000)
$
(35.000)
Net Operating income
$
-
S
-
$
-
$
-
It
(4,490)
$
(10,947)
Retail
Effective Gross Incense
$
948,480
$
948,460
$
1,0]],300
$
1,077,300
$
200,640
$
200,640
Less: Operating Expenses
$
(284541
$
(284547
$
132318)
$
(32,319)
$
(6019)
$
(8019)
Net Operalin9 Income
$
920,026
$
920,026
$
1,044,981
$
1,044,981
$
194,621
$
194,621
Office
Effective Gross In..
$
649,201
$
1,492,873
$
1,197,285
$
2,778,584
$
-
S
-
Less:OperatingExpenses
$
(672711
$
(153,713)
$
(113724)
$
(264,4731
$
$
Net Operating Income
$
561,930
$
1,339,160
$
1,083,561
$
2,512,111
S
-
$
-
Hotel
Effective Gross income
$
-
$
-
$
-
$
-
Less: Opemtin9Expenses
S
$
S
$
S
$
Net Operating Income
$
-
$
$
-
$
S
$
-
Total Net Operating Income
$
1,501,956
2,269,186
$
2,128,542
5
3557092
$
1,240,145
$
1,829,035
Project Component Values (see App. F)
ResidentElMorket Rate
NOI
$
-
$
$
$
$
1,055,014
$
1,645,361
Cap Rate
5.30%
5.30%
5.3D%
5.30%
5.30%
5.30%
Value
$
-
$
-
$
-
$
-
$
19,924,792
$
31,044,547
Residenflae- Affordable
NOI
$
$
-
$
$
-
$
(4,490)
$
(10,947)
Cap Rate
5.3014
5.30%
5.30%
5.30%
5.30%
5.30%
Value
$
-
$
-
$
-
$
-
$
(84,717)
$
(206,547)
Relief
Not
$
920,026
$
920,026
$
1,044,961
$
1,044,9111
$
194,521
$
194,621
Cap Rate
6.60%
8.60%
6.60ks
6.60%
6.60%
6.60%
V.W.
$
13,939,788
$
13,939,788
$
15,833,045
$
15,833,045
$
2,948,803
$
2,948,803
Office
Not
$
581,930
$
1,339,160
$
1,003,561
$
2,512,111
$
$
-
Cap Rate
6.40%
6.40%
6.40%
6.40A
6.40%
6.40%
Value
$
9,092,656
$
20,924,375
$
16.930,641
S
39,251,734
$
-
$
-
Hotel
Not
$
-
$
S
$
-
$
$
-
Cap Rale
7.90%
7.90%
7.90%
7.90%
7.90%
7.90%
Value
$
-
$
-
$
$
-
$
$
.
Total Project Value
$
23032444
$
34,854,163
S
32763666
$
55084779
$
22]800]6
$
33786803
Developer Relums
_
Developer Prole -
TOtdiProjectVdlue
$
23,032,444
$
34,664,163
$
32,763,666
$
55,084,779
$
22,788,678
$
33,786,803
Less: Total Development Cast
$
(20765052)
$
(31,531,103)
$
(2951920]1
$
(50,10],6511
$
(20,8152837
$
(30862301)
Pm6l
%7)f Mahe
$
2,267,382
7)a,
$
3,333,060
`u nix
$
9,244,479
aa.c
$
4,977,128
'o nac
$
1,9]3,595
L7)1..
$
2,924,502
'vv =i
Feasible? Yes Yes Yes Yes Marginal Marginal
(j AR&AMidsors, Inc.
Page ?Of 8 Test 1 &2 RCC WM Fees for mourn is b5ummary
4 -2014
pO[,v40
$
b,916,om
$
I3BIU,716
$
5,821,668
$
2,160,794
$
3,271,000
Change in Profit
-11.2%
-14.0%
-10.1%
14.5%
40%
- 10.6%
Feasible?
Yes
Yes_
Yes
Yes
Marginal
Marginal
Return on Total Development Cost
NOI
$ 1,501,956
$
2.259,186
$
2,128,542
$
3,557,092
$
1,246,145
$
1,829,035
Total Development Cast
$ (20,765,062)
$
(31,531,103)
S
(29,518,207)
$
(50,107,651)
$
(20,815,283)
5
(30,862,301)
Return on Cost
7.23'%
7.16%
7.21%
7.10%
5.99%
5.93%
Return on Cost No Fees
7,33%
130%
130%
7.22%
6L4%
580%
Change in Return on Cost
40.10%
-0.14%
-0.09%
-0.12%
-0.O6%
-0.07%
Feasible? Yes Yes Yes Yes Marginal Marginal
(j AR&AMidsors, Inc.
Page ?Of 8 Test 1 &2 RCC WM Fees for mourn is b5ummary
4 -2014
l �.lt
Anal ze. Advise. Act.
Y
700 South flower Street, Suite 2730, Los Angeles, CA 900 "17
1: 3 "10 -581 -0900 I F: 310 -581 -0910 1 www.hmadvisors.com
li _ t�1 0romirkDJ11 fl
To: David Martin, Karen Ginsberg & Andy Agle
From: Paul J. Silvern and Remy Monteko
Date: July 29, 2014
Re: Proposed New Development Fees Analysis Update
Cc: Barry Rosenbaum, Esq. & Alan Selzer, Esq.
In response to discussion at the Planning Commission's ( "Commission ") meeting on May 14, 2014,
we have completed an update to the analysis of the financial feasibility of the proposed new Parks
& Recreation Fee and Affordable Housing Linkage Fee, including increases for potential new fees
(and the Transportation Impact Fee) for Tier 2 projects, for the development prototypes presented
to the Commission at that hearing, as well as for new mixed -use retail /residential prototypes, as
requested by the Commission. As also requested by the Commission, we prepared a sensitivity
analysis for one of the new mixed -use prototypes to test the implications of assuming that the
required affordable housing is provided for 50 percent income households, rather than 30 percent
income households, as had been assumed in previous modeling work. This memorandum summarizes
the analysis update results for the previously presented prototypes, the additional prototypes and
the affordable housing sensitivity analysis. The memo also includes a general summary of the
modeling approach. A series of attachments are included, which present the modeling output that
is summarized in the memo.
Analysis Update Summary and Conclusions
Our analysis update included the following tasks:
We updated the residual land value and return on cost /developer profit margin models for
three pairs of Tier 1 and Tier 2 (six total) prototypes (four mixed -use commercial and two
mixed -use retail /residential), as presented to the Planning Commission on May14. The revised
analysis now reflects the actual proposed Tier 2 fee increase approach, rather than an imputed
estimate of the higher Tier 2 fees. This set of six prototypes includes two Tier /Tier 2 pairs with
commercial uses only (one on Wilshire Boulevard and one in the Downtown) and one mixed -use
pair with retail and residential uses on Wilshire. All of these prototypes are on larger 22,500
s.f. sites, and all buildings are about 39,000 or more gross square feet.
We then prepared modeling analysis for four new pairs of smaller Tier 1 and Tier 2 prototypes
(8 total), which include three pairs of Boulevard Low mixed -use retail /residential prototypes
and one additional pair of Downtown mixed -use retail /residential prototypes, all on smaller
138 &A Advisors, Inc. I Los Angeles I Now York I Washington, D.C.
15,000 s.f. sites, and all but one of which with smaller buildings of 27,000- 40,000 square feet
of gross floor area.
® We also prepared a sensitivity test on the new Downtown mixed -use retail /residential
prototypes to assess the implications of assuming 50 percent income units (i.e., 10% at Tier 1
and 15% at Tier 2) in lieu of 30 percent income units (i.e., 5% at Tier 1 and 7.5% at Tier 2), as
assumed in all of the other modeling work.
In preparing these analyses, we utilized the same modeling approach (i.e., residual land value
models without and with new fees; return on cost /developer profit margin models without and with
new fees), as in all of our prior work on this subject (and before that, on the financial feasibility
implications of the Transportation Impact Fee (TIF)). For the new prototypes, we maintained the
same basic assumptions as were used for the six prototypes previously presented to the Commission,
except where new assumptions were required for the specific characteristics of the new prototypes
(e.g., construction costs for smaller developments; commercial rents and apartment rents for the
boulevards).
Key conclusions we draw from the analysis update include the following:
• The previously estimated 1.14 fees increase factor for Tier 2 is still the maximum that enables
the six prototypes previously presented to the Commission to remain financially feasible,
according to the benchmarks we have used throughout this analysis process. The limiting
feasibility factor is primarily the all- commercial profile of most of these prototypes. But the 1.14
Tier 2 factor is also feasible for the eight new mixed -use retail /residential prototypes.
• For the all- commercial prototypes previously presented to the Commission, the cumulative impact
of the Tier 2 fees with a 1.14 factor increase is between about $15 and $20 per gross square
foot, or about 2.3% to 3.6% of total development cost. The cumulative impact of the Tier 2 fees
for the previously presented mixed -use retail /residential prototype on Wilshire is much less (i.e.,
$4 -$5 per square foot and about 1 % of total development cost), due to fee credits for assumed
existing retail.
• For the eight new mixed -use retail /residential prototypes, the TIF, under Tier 1 and Tier 2 with
a 1.14 factor increase, is fully offset by the credit for assumed existing retail on each site.
• For the new mixed -use retail /residential prototypes, the proposed new Affordable Housing
Linkage Fee is also fully offset, under Tier 1 and Tier 2 with a 1.14 factor increase, because:
1) the fee only applies to a very modest amount of ground floor retail in each prototype; and
2) the credit for assumed existing retail exceeds the fee amount applicable to retail space in
each prototype.
• Due to the fee credit for existing retail, only the proposed new Parks & Recreation fee has any
impact on the new mixed -use retail /residential prototypes.
• Therefore, the cumulative new fees for the new Tier 1 and Tier 2 mixed -use retail /residential
prototypes represent only about 0.3% to 1.5% of total development cost, assuming the Tier 2
increase is set at the 1.14 level that was derived from the six larger prototypes previously
presented to the Commission, most with much more commercial space.
• Because of the effects of the fees credit for assumed existing retail, it would be technically
possible to raise the Tier 2 increase factor above 1.14 for the new mixed -use retail /residential
prototypes and still achieve financially feasible results. But to do so would require a complex
I IR &A ADVISORS, INC.. New Fees Analysis Update 12
K
Tier 2 fee schedule that varies by street, project type and project scale, which could be difficult
to administer.
® For the new Downtown mixed -use retail /residential prototype, changing the assumed
affordable housing to 50 percent income units, from 30 percent income units as previously
assumed, and using the 1.14 Tier 2 factor, causes only a marginal change in the financial
feasibility results for that prototype. But it should be noted that the applicable difference in the
number of affordable units involved is very small (i.e., a Tier 2 net increase of +4 affordable
units when going from 30 percent income units to 50 percent income units, and a corresponding
reduction of four market rate units).
Updated Results for Previously Presented Mixed -Use Prototypes
Table 1 summarizes the updated fee results and feasibility conclusions for the six prototypes
presented to the Commission in May. As noted above, these are primarily all- commercial prototypes
on larger sites. Table 1 shows that, as previously reported to the Commission, according to the
financial feasibility thresholds utilized in our analysis, a uniform 14 percent increase for all three
fees for Tier 2 prototypes would be financially feasible. Table 1 includes information about the
physical characteristics of the six prototypes utilized in the analysis, and the resulting net amounts
for each fee, as well as the cumulative total of all three fees. It also expresses the net fees
(individually and cumulatively) as percentages of total development cost and dollars per gross and
net square foot. Finally, Table 1 summarizes the degree to which the cumulative incremental
additional net fees cost affects the financial feasibility of each prototype. All six of these prototypes
are either feasible or marginally feasible at the Tier 1 and Tier 2 levels.
As noted in our memorandum report for the May 14, 2014 Commission meeting, it is important to
note that "net fee" amounts shown in Table 1 (and in the subsequent Tables) reflect a fee credit for
existing retail assumed at each site. The TIF fee credit for existing retail in the Wilshire mixed -use
prototypes cancels out the TIF at both Tier levels. Similarly, for the proposed new Affordable
Housing Linkage Fee, which applies only to the ground floor retail in the Wilshire mixed -use
prototypes, the fee credit cancels out the Linkage Fee. Calculation details and other modeling results
for these prototypes are included in Attachment A.
HR &A ADVISORS WC. New Fees Analysis Update 13
11
Amount
% x Total Development Cost
$ per Gross SF
$ per Net SF
$214,432
1.0%
$5.50
$6.35
Table 1
$273,558
0.9%
$6.06
$6.97
$595,470
1.2%
$7.81
$8.85
$0
0.0%
$0.00
$0.00
$0
0.0%
$0.00
$0.00
Estimated Net Development Fees and Feasibility Results for 6 Prototypical Projects in the City of Santa Monica
Wilshire Mixed -Use Commercial Downtown Mixed -Use Commercial
Wilshire Mixed -Use Retail /Residential
Ter 1
Ter 2
Tier 1
Ter 2
Ter 1
Tier 2
Land Area
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg. Area (SF)
39,000
57,750
45,111
76,222
40,125
59,521
Net Leasable Area (NSF)
33,750
50,625
39,250
67,250
33,750
50,625
1st Floor Retail
12,950
29,825
21,250
49,250
4,400
4,400
Upper Floor Office
20,800
20,800
18,000
18,000
-
-
Residential
-
-
-
-
29,350
46,225
If Residential Units
-
-
-
-
40
64
# Market Rate Units
-
-
-
-
38
59
#Affordable Units
-
-
-
-
2
5
Total Dov lopment Cost(wlland)
$20,675,062
$31,336,235
$29,444,361
$49,696,524
$20,806,477
$30,842,884
Ter 2 Fees Factor
1.00
1.14
1.00
1.14
1.00
1.14
Net TIF Fees
Feasible?
MARGINAL
r YES
YES
YES
MARGINAL
Amount
$427,315
$632,112
$347,875
$657,499
$0
$0
% x Total Development Cost
2.1%
2.0%
1.2%
1.3%
0.0%
0.0%
$ per Gross SF
$10.96
$10.95
$7.71
$8.63
$0.00
$0.00
$ per Net SF
$12.66
$12.49
$8.86
$9.78
$0.00
$0.00
Net Parks& Rec Fees
Amount
$44,192
$87,995
$59,179
$132,914
$177,343
$297,162
% x Total Development Cost
0.2%
0.3%
0.2%
- 0.3%
0.9%
1.0%
$ per Gross SF
$1.13
$1.52
$1.31
$1.74
$4.42
$4.99
$ per Net SF
$1.31
$1.74
$1.51
$1.98
$5.25
$5.87
Amount
% x Total Development Cost
$ per Gross SF
$ per Net SF
$214,432
1.0%
$5.50
$6.35
$405,670
1.3%
$7.02
$8.01
$273,558
0.9%
$6.06
$6.97
$595,470
1.2%
$7.81
$8.85
$0
0.0%
$0.00
$0.00
$0
0.0%
$0.00
$0.00
Cumulative New Net Fees
Amount
$685,939
$1,125,777
$680,612
$1,385,882
$177,343
$297,162
% x Total Do%olopment Cost
3.3%
3.6%
2.3%
2.8%
0.9%
1.0%
$ per Gross SF
$17.59
$19.49
$15.09
$18.18
$4.42
$4.99
$ per Net SF
$20.32
$22.24
$17.34
$20.61
$5.25
$5.87
Resulting Residual Land Value
$11-and SF
$199
$267
$442
$670
$432
$603
Change
($13)
($17)
($13)
($19)
($8)
($14)
% Change
-6.0%
-6.1%
-2.8%
-2.8%
-1.9%
-1.9%
Feasible?
YES I
YES
I YES
YES
YES
YES
Resulting Developer Profit Margin
%x Project Value
9.8%
10.1%
10.1%
9.8%
8.7%
8.7%
• Change
-11.2%
- 10.0 %
-8.1%
-7.4%
-8.6%
-10.0%
Feasible?
MARGINAL
r YES
YES
YES
MARGINAL
MARGINAL
Resulting Return on Total Cost
% x Total Development Cost
7.23%
7.21%
7.23%
7.16%
5.99%
5.93%
Change (percentage points)
(0.10)
(0.90)
(0.07)
(0.06)
(0.05)
(0.06)
Feasible? YES I YES FMARGINAL I MARGINAL
' "Net" Fee Amount = Fee per land use NSF minus credit for The applicable to assumed existing development on each site (i.e., retail on one -half
Prepared by. HR &A Advisors, Inc.
1 -111&A ADVISOaS, INC. New Fees Analysis Update 14
Results for Eight Now Mixed -Use Retail /Residential Prototypes
Table 2 summarizes the fee results and feasibility conclusions for the six new prototypes on Pico,
Santa Monica and South Lincoln Boulevards, and in the Downtown area. As noted above, these are
all mixed -use retail /residential prototypes on smaller sites. Table 2 also shows that, according to
the financial feasibility thresholds utilized in our analysis, a uniform 14 percent increase for all three
fees for Tier 2 prototypes would be financially feasible. Once again, Table 2 includes information
about the physical characteristics of the new prototypes, and the resulting net amounts for each fee,
as well as the cumulative total of all three fees. It also expresses the net fees (individually and
cumulatively) as percentages of total development cost and dollars per square foot. It also
expresses the net fees (individually and cumulatively) as percentages of total development cost
and dollars per gross and net square foot. Finally, Table 2 summarizes the degree to which the
cumulative incremental additional net fees affects the feasibility of each prototype. All eight
prototypes are also either feasible or marginally feasible at the Tier 1 and Tier 2 levels.'
As noted above with respect to the Wilshire Boulevard mixed -use retail /residential prototype, the
fee credits for assumed existing retail cancel out the TIF fees that would otherwise apply, and the
Linkage Fee that would otherwise apply to the ground floor retail space in each of the new mixed -
use retail /residential prototypes. As a result of credit for assumed existing retail, the Tier 2 increase
factor for these prototypes could conceivably be increased above 1.14 and still fall within
feasibility thresholds used in the analysis. This is because, as a practical matter, a change to a
higher factor would apply only to the proposed Parks and Recreation Fee for the incremental
increase in the number of Tier 2 market rate units. Calculation details and other modeling results
for these prototypes are included in Attachment B.
The fact that several of these prototypes are deemed marginally feasible from a return on total development cost
perspective is a function of their being marginally feasible in the base case with no new development fees. The
incremental addition of the fees has a negligible impact on the feasibility metrics.
I-IR &A ADvisoRs, INS. New Fees Analysis Update 1 5
Table 2
Estimated Net Development Fees and Feasibility Results for 8 Prototypical Mixed -Use Retail /Residential Projects in the City of Santa Monica
Land Area
Gross Bldg. Area (SF)
Net Leasable Area (NSF)
1st Floor Retail
Residential
If Residential Units
# Market Rate Units
N Affordable Units
Total Development Cost (w /land)
Pico Blvd. Mixed -Use
S.M. Blvd. Mixed -Use
So. Lincoln Blvd. Mixed -Use
Retail /Residential
Retail /Residential
Retail /Residential
Tier
Tier
Tiers
Tiier2
Tier
Tier
15,000
15,000
15,000
15,000
15,000
15,000
27,247
31,557
27,247
29,973
27,247
35,868
22,500
26,250
22,500
23,145
22,500
30,000
3,000
3,000
3,000
3,000
3,000
3,000
19,500
23,250
19,500
20,145
19,500
27,000
24
29
24
26
24
34
23
27
23
24
1
31
1
2
1
2
25
3
$8,742,118
$10,266,227
$10,412,141
$10,743,272
$9,331,457
$12,078,960
1.00
1.14
1.00
1.14
1.00
1.14
Downtown Mixed -Use
Retail /Residential
15,000
40,140
33,750
4,000
29,750
37
35
2
$20,990,596
1.00
15,000
61,117
52,000
4,000
48,000
61
56
5
$30,888,927
1.14
Amount
$0
$0
- $0
$0
$0
$0
$0
$0
% x Total Development Cost
0.0%
a0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
$ per Gross SF
$O.OD
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$ per Net SF
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
Net Parks & Rec Fees
Amount
$106,145
$146,624
$106,145
$112,141
$106,145
$190,337
174074
391244
% x Total Development Cost
1.2%
1.4%
1.0%
1.0%
1.1%
1.6%
0.8%
1.3%
$ per Gross SF
$3.90
$4.65
$3.90
$3.74
$3.90
$5.31
$4.34
$6.40
$ per Net SF
$4.72
$5.59
$4.72
$4.85
$4.72
$6.34
$5.16
$7.52
Net Afford. Hsg. Fees
Amount
$0
$0
$0
$0
$0
$0
$0
$0
% x Total Development Cost
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
$ per Gross SF
$O.OD
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$ per Net SF
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
Cumulative New Net Fees
Amount
$106,145
$146,624
$106,145
$112,141
$106,145
$190,337
$174,074
$391,244
% x Total Development Cost
1.2%
1.4%
1.0%
1.0%
1.1%
1.6%
0.8%
1.3%
$ per Gross SF
$3.90
$4.65
$3.90
$3.74
$3.90
$5.31
$4.34
$6.40
$ per Net SF
$4.72
$5.59
$4.72
$4.85
$4.72
$6.34
$5.16
$7.52
Resulting Residual Land Value
$/Land SF
$100
$124
$211
$181
$139
$173
$688
$551
Change
-$B
-$11
48
-$8
-$8
-$14
-$14
-$35
%Change
-7.0%
-8.3%
-3.5%
-4.2%
-5.1%
-7.3%
-2.0%
-5.9%
Feasible?
YES
YES
YES
YES
YES
YES
YES
YES
Resulting Developer Profit Margin
% x Project Value
11.3%
11.0%
11.5% 11.5%
11.4%
11.0% 11.6%
11.0%
%Change
-9.5%
-11.3%
-7.9% -8.1%
-8.9%
-12.4% -7.1%
-12.0%
Feasible?
YES
YES
YES YES
YES
YES YES
YES
Resulting Return on Total Cost
% x Total Development Cost
6.14%
6.09%
6.17% 6.21%
6.23%
6.14% 6.21%
6.10%
Change (percentage points)
(0.08)
(0.10)
(0.07) (0.09)
(0.08)
(0.11) (0.06)
(0.10)
Feasible?
MARGINAL
MARGINAL
MARGINAL YES
YES
MARGINAL YES
MARGINAL
' "Net" Fee Amount = Fee per land use NSF minus credit for fee applicable to assumed existing development on each site (i.e., retail on one -half
of each site).
Prepared by. HR &A Adwsors, Inc.
INc:. New Fees Analysis Update 1 6
Results for the New Downtown Prototype Assuming 50 Percent Income Units
Table 3 summarizes the fee results and financial feasibility conclusions for the new Downtown
mixed -use retail /residential prototype if it were assumed that the required affordable units were
to be reserved for 50 percent income households (i.e., 10% for Tier 1 and 15% for Tier 2)
instead of 30 percent income households (i.e., 5% for Tier 1 and 7.5% for Tier 2). As noted
above, there is only a slight difference in fee amounts, due to small changes in the mix of market
rate and affordable units. The financial feasibility results are also affected by small changes in
net operating income, due to the differences between 50 percent income unit rents and 30
percent income rents, but applied again to very small differences in the numbers of those
respective units in these prototypes. Overall, there is no difference in the conclusion as to financial
feasibility when assuming 50 percent income units for this prototype. Calculation details and
model results are included in Attachment C.
I-IR &A ADVISORS, INC. New Fees Analysis Update 17
Table 3
Estimated Net Development Fees and Feasibility Results for a
Downtown Mixed -Use Retail /Residential Prototype,
With 30% Income Affordable Units vs. 50% Income Affordable Units
$/Land SF
With 30% Income
With 50 %Income
$605
Affordable Units
Affordable Units
-$14
Tier 1
Tier 2
Tier 1
Tier 2
Land Area
15,000
15,000
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
40,140
61,117
Net Leasable Area (NSF)
33,750
52,000
33,750
52,000
1st Floor Retail
4,000
4,000
4,000
4,000
Residential
29,750
48,000
29,750
48,000
# Residential Units
37
61
% 37
-:61
# Market Rate Units
35
56
<33
52
# Affordable Units
2
5
4
'9
Total Development Cost (w /land)
$20,990,596
$30,888,927
$19,608,972
$29,075,166
Tier Fees Factor
1.00
1.14
1.00
1.14
Net TI Fees
to assumed existing
development on each site (i.e., retail on
one -half of each site).
Amount
$0
$0
$0
$0
% x Total Development Cost
0.0%
0.0%
0.0%
0.0%
$ per Gross SF
$0.00
$0.00
$0.00
$0.00
$ per Net SF
$0.00
$0.00
$0.00
$0.00
Net Parks & Rec Fees
Amount
$174,074
$391,244
$159,132
$338,095
% x Total Development Cost
0.8%
1.3%
0.8%
1.2%
$ per Gross SF
$4.34
$6.40
$3.96
$5.53
$ per Net SF
$5.16
$7.52
$4.72
$6.50
Net Afford. Hsg. Fees
Amount
$0
$0
$0
$0
% x Total Development Cost
0.0%
0.0%
0.0%
0.0%
$ per Gross SF
$0.00
$0.00
$0.00
$0.00
$ per Net SF
$0.00
$0.00
$0.00
$0.00
Cumulative New Net Fees
Amount
$174,074
$391,244
$159,132
$338,095
% x Total Development Cost
0.8%
1.3%
0.8%
1.2%
$ per Gross SF
$4.34
$6.40
$3.96
$5.53
$/Land SF
$688
$551
$605
$454
Change
-$14
-$35
-$11
-$26
%Change
-2.0%
-5.9%
-1.8%
-5.5%
Feasible?
YES
YES
YES
YES
Resulting Developer Profit Margin
% x Project Value
11.6%
11.0%
11.7%
11.4%
% Change
-7.1%
-12.0%
-6.3%
-9.1%
Feasible?
YES
YES
YES
YES
Resulting Return on Total Cost
% x Total Development Cost
6.21%
6.10%
6.24%
6.14%
Change (percentage points)
(0.06)
(0.10)
(0.05)
(0.08)
Feasible?
YES
MARGINAL
YES
MARGINAL
' "Net" Fee Amount = Fee per land use NSF minus credit
for fee applicable
to assumed existing
development on each site (i.e., retail on
one -half of each site).
Prepared by., HR &A Advisors, Inc.
HR&A ADVISORS, Nc. New Fees Analysis Update 1 8
Summary of Feasibility Modeling Approach
The modeling approach on which the above results are based is the same approach used by HR &A
in all previous iterations of the analysis of the proposed new fees, as well as the financial feasibility
analysis for the adopted TIF. As in the TIF analysis, computer models were prepared to simulate the
financial feasibility implications of developing and operating each development prototype after
construction completion, without and with the two new fees. The development cost profile for the
prototypes includes, in addition to all the usual hard costs, soft costs and construction financing costs,
all of the typical current public fee requirements, including other City planning and construction fees,
fees for child care, the arts, open space, the new TIF, and the Santa Monica - Malibu Unified School
District's school facilities fee, as applicable. For the mixed -use retail /residential prototypes, the
City's affordable housing requirements were addressed by including five percent of residential
units for 30 percent income households in the Tier 1 prototypes, and 7.5 percent in the Tier 2
prototypes, except for the sensitivity test reported above where alternative assumptions were made
for 50 percent income units. For the no new -fees scenarios, the analysis assumes that the current
Parks and Recreation Facilities Tax and Housing and Parks Mitigation Fees would continue to apply,
as well as the adopted TIF (and including its allowable credit for assumed existing retail).
One feasibility model takes the form of a "residual land value" analysis, in which the cost for land
that a developer could afford to pay in order to earn a market- responsive return on investment is
derived, rather than assumed. This model is then used to measure the cumulative impact of the new
fees on the residual land value. We then use the derived land values in a second feasibility model
to test the resulting return on total development cost and developer profit margin, again without
and with the two proposed new fees.
In preparing this analysis we utilized the same real estate industry metrics in assessing the financial
feasibility of the proposed new fees as we used in the TIF analysis. In our view, it is not sufficient to
look at only one of these metrics, because they each measure a different set of financial
relationships. Rather, all three metrics should be considered together to assess feasibility.
To recap, the three feasibility metrics are:
• Change in Residual Land Value (RLV). As with the TIF, we started the analysis by not assuming
a particular land cost for each prototype, but instead derived the cost that an informed
developer could afford to pay for land and still earn a market - responsive return on completion
of each prototype. We then compared the change in the baseline RLV with the new RLV after
adding the cost of the proposed new fees. In general, it is our experience that a change in
residual land value up to about 20 percent would not render a development project infeasible
(i.e., that is the upper end of a reduction that could be successfully accommodated through
negotiations between a land seller and a developer).
• Change in Developer Profit Margin. As with the TIF, this analysis is performed in a Return on
Cost spreadsheet model separate from the RLV model. We import the baseline RLV model into
the Return on Cost model, and then calculate developer profit (i.e., (completed project value —
total development cost) / completed project value). We compare the profit margin resulting
from the base case with no new fees with calculations that include the proposed new fees and
derive both the dollar differences and the percentage change. In our experience a reduction in
developer profit of more than 15 percent would tend to render a development infeasible. In
addition, we check the resulting with -fees profit margin as a percent of total project value. In
our experience, this value should be at least 10 percent.
• Change in Return on Total Development Cost. This metric is calculated in the Return on Cost
model using the baseline RLV. It is calculated as (Net Operating Income / Total Development
HR8 A ADVISORS, INC. New Fees Analysis Update 1 9
9
Cost). We first calculate the Return on Cost for the base case version of each prototype without
the proposed new fees, and then compared that result with analysis that includes the new fees.
In our experience, a change in Return on Cost of more than 0.2 percentage points would tend
to indicate that a prototype is infeasible, because it would lower the margin between the return
on cost and the assumed income capitalization (or "cap ") rate to an unacceptable degree. For
this analysis we assume that the return on cost margin over the weighted average cap rate for
each prototype needs to be at least in the 0.75 -1.00 range.
As we have noted on numerous occasions in conducting real estate feasibility analysis of proposed
changes in City fees, land use policies or proposed development projects, there are rarely any
bright -line thresholds for determining financial feasibility in the real estate industry, in our
experience. That is because of differences in the levels of experience, investment objectives and
access to capital among developers working in the City, all of which can be affected by a particular
position in the real estate market cycle for one or more land uses. There will always be some
developers who require higher, or accept lower, financial feasibility thresholds to proceed with a
project, or who have a particular sensitivity to one feasibility metric (or a different metric than
employed in this analysis) above all others. However, lines must be drawn somewhere in conducting
the kind of analysis presented in this memo. We believe that for this analysis, as with the TIF analysis,
we have used reasonable feasibility metrics and established reasonable thresholds for each metric
to support decision making by the City Council.
HR &A derived maximum proposed new fee amounts based on prior analysis that systematically
tested each of the prototypes with different levels of the two fees (i.e., different percentages of
the maximum justified fees per the nexus studies), individually and cumulatively, using the 'same
financial feasibility metrics noted above. The resulting fees (25 percent of the maximum justifiable
fee for the parks and recreation fee and 4.5 percent for the affordable housing linkage fee) reflect
levels at which financial feasibility for each of the prototypes was pushed to the limit of specified
feasibility thresholds. This analysis was then adapted to test the maximum increase to the proposed
new fees and the TIF that could be applied to the net increase in dwelling units and commercial
floor area in Tier 2 versions of Tier 1 prototypes, and still fit within the feasibility thresholds utilized
in the analysis.
General Conclusions
We conclude from the above- described analysis that the proposed new Parks and Recreation Fees
and Affordable Housing Linkage Fees, if adopted at the percentages of the maximum justifiable
fee amounts utilized in our analysis, and the estimated Tier 2 versus Tier 1 increases of 1. 14, could
be absorbed by developers of projects like the prototypes analyzed, and result in financially
feasible projects.
These results are sensitive to all of the assumptions used in the analyses described in this memo.
Changes in some of these assumptions, particularly leasable floor areas, hard construction costs,
rents and income capitalization rates, or the assumed new fee credits for replacement of existing
retail uses, could alter the analysis results and conclusions based on those results
All dollar amounts presented in this memo and the underlying proposed new fees analysis are
stated in 2014 dollars, without inflation.
Attachment A (updated analysis of the previous six prototypes) includes the details of the net fee
calculations, and feasibility model results supporting the information in Table 1. Attachment B
(analysis of the eight new mixed -use retail /residential prototypes) presents similar information
supporting the information in Table 2. Attachment C presents support for the information presented
111M ADVISORS, INC. New Fees Analysis Update I 10
1E
in Table 3 regarding a different assumption about the household income level assumed for the
affordable units in each prototype.
We are available to answer any questions that you or members of the Planning Commission may
have about any of the information presented in this memo.
H° &A ADVIS02S, INC.
it
Fees Analysis Update I 1 1
Attachments
A. Updated analysis results for 6 prototypes previously presented to the Planning Commission:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
B. Updated analysis results for 8 new prototypes:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
C. Sensitivity test for Downtown mixed -use retail /residential prototype assuming 50% income
units:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
HR &A ADVISORS, INC.
12
New Fees Analysis Update 1 12
Updated analysis results for 6 prototypes previously presented to the Planning Commission:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
13
Residual Land Value
Results Summary -Tier 18 2 (Will, Asti Fees)
Program Summary (see App, A)
Total Net Operating Income
$
Mixed -Use
Mixed -Use
$
Mixed -Use
Mixed -Use
Mixed Use
Mixed -Use
Prototype Name
Commercial
Commercial
Commercial
Commercial
RetaigResidential
RetaNResidential
Location
Wilshire
Wlshire
Grams.
Dovmtovm
Wlshire
Wlshire
LUCETW
$
1
2
$
1
2
1
2
Permit Requirement
5.30%
5.30%
5,30%
5.30%
5.30%
5.30%
#Pamela
$
3
3
$
3
3
3
3
Bldg. Height (Feet)
32
50
32
60
32
50
Shares (4)
$
2
3
$
2
4
2
4
Site Area (SF)
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg. Area (SF)
$
39,00D
57,750
$
45,111
76,222
40,125
59,521
Floor Area poll, (FAR)- Gross Area
1.73
2.57
2.00
3.39
1.78
2.65
Floor Area Relio(FAR) -Net Area
$
1.50
2.25
$
T74
2.99
1.50
2.25
Net Leasable Areas
6.60%
6.60%
6.60%
6.60%
6.60%
6.60%
Residential (SF)
$
-
-
$
-
-
29,350
46,225
Markel Rate Units
-
--
-
-
38
59
Affordable Units
$
-
$ 1,339,160
$
1,083,561
$ 2,512,111
2
5
Tolal Units
-
-
-
6.40%
40
64
Relail(SF)
$
20,800
20,800
$
18,000
18,000
4,400
4,400
Office (SE)
$
12,950
29,825
$
21,250
49,250
-
-
_ Hotel {SF)
Development Costs (see App. B&C8D)
$
23,032,444
$ 34,864,163
$
32,763,686
$ 55,084,779
$ 22,788,878
$ 33,796,803
Land Costs
sea Residual Value
see Residual Value
see Residual Value
see Residual Value
sea Residual Value
see Resitlual Value
Ham Costs
$
11,878,402
$ 16,522,996
$
14,115,638
$ 25,226,136
$ 7,730,679
$ 12,072,482
Son Carl.
$
-
$ -
$
-
$ -
$ -
$ .
Net Parind Recreation Fee
$
44,192
$ 87,995
$
59,179
$ 132,914
$ 177,343
$ 297,162
Net Affordable Housing Linkage Fee
$
214,432
$ 405,670
$
273,558
$ 595,470
$ -
$ -
TIE Fees ' -
$
427,315
$ 632,112
$
347,875
$ 657,498
$
$ -
OtherCity Costs(see App. E)
$
408,94!1
$ 645,275
$
46S303
$ 752,762
$ 313,058
$ 530,204
Other Sell Crete
$
1,482,957
$ 2,308,219
$
1,755,051
$ 3,130,082
$ 1,130,923
$ 1,763,318
Financing C,uda
$
1,216,626
$ 1,Bg1007
$
1705047
$ 2,629,787
$ 863,973
$ 1,335680
Total Development Cost
$
15,872,872
$ 24,493,274
$
18,724,651
$ 33,124,649
$ 10,215,976
$ 15,998,845
per GSF
$402
$424
$415
$435
$255
$269
Net Operating Income (NOI) (see App, E)
Residenlial - Market Rate
Effective Gross Income
$
-
$ -
$
-
$ -
$ 1,322,014
$ 2,056,361
Less: Operating Expenses
$
$
$
$
$ 1266A00)
$ (4130007
Net Operating Income
$
-
$ -
$
-
$ -
$ 1,056,014
$ 1,645,361
Residential-Affordable
Effective Gross Income
$
-
$ -
$
-
$
$ 9,510
$ 24,053
Less: Operting Expenses
$
$
$
$
$ (14,000
$ (35000)
Net Operating Income
$
-
$ -
$
-
$
$ (4,490)
$ (10,947)
Retail
Effective Gross Income
$
948,480
$ 948,480
$
1,077,300
$ 1,077,300
$ 200,640
$ 200,640
Less: Operating Expenses
$
(28,454)
$ (28,454)
$
(32319)
$ (32319)
$ (6,019)
$ f6.0191
Net Operating income
$
920,026
$ 920,026
$
1,044,981
$ 1,044,981
$ 194,621
$ 194,821
Office
Effective Gross Income
$
649,201
$ 1,492,873
$
1,197,285
$ 2,776,584
$ -
$
Less: Operating Expenses
$
(19,476)
$ (44,786
$
(35,919)
$ (83,2981
$
$
Net Operating Income
$
581,930
$ 1,339,160
$
1,083,561
$ 2,512,111
$ -
$ -
Total Net Operating Income
$
1.501,955
$ 2,259,186
$
2,128.642
$ 3,557.092
$ 1.246,145
$ 1,829,035
Project Component Values (see App. F)
Residenlial - Market Rate
NOI
$
-
$ -
$
-
$ -
$ 1056,014
$ 1,645,361
Cap Rate
5.30%
5.30%
5,30%
5.30%
5.30%
5.30%
Value
$
-
$ -
$
-
$ -
$ 19,924,792
$ 31,044,547
Residential - Affordable
NOI
$
-
$ -
$
-
ti
$ (4,490)
$ (10,947)
Cap Rate
5.30%
5.30%
5.30%
5.30%
5.30%
5.30%
Value
$
-
$ -
$
-
$
$ (84,717)
$ (206,547)
Retail
NOI
$
920,026
$ 920.026
$
1,044,981
$ 1,044,981
$ 194,621
$ 194,621
Cap Rate
6.60%
6.60%
6.60%
6.60%
6.60%
6.60%
Value
$
13,939,788
$ 13,939,788
$
15,833,045
$ 15,833,045
$ 2,948,803
$ 2,948,803
Office
NOI
$
581,930
$ 1,339,160
$
1,083,561
$ 2,512,111
$ -
$ -
Cap Rate
6A(SA
6.40%
6.40%
6.40%
6.40%
6.40%
Value
$
9,092,656
$ 20,924,375
$
16,930,641
$ 39,251,734
$ -
$ -
Total Project Value
$
23032444
$ 34,664163
$
32,763,686
$ 55,084.779
$ 22.788,878
$ 33,706,803
Residual land Value Estimate
Total Project Value
$
23,032,444
$ 34,864,163
$
32,763,686
$ 55,084,779
$ 22,788,878
$ 33,796,803
Less: DeveloperProfil
$
(2,879,056)
$ (4,356,020)
$
(4,095,461)
$ (6,885,597)
$ (2,848,610)
$ (4,223,350)
Less: Total Development Cost
$
(15672872)
$ (24493274)
$
U8,724,651)
$ (33,124,649)
$ (102159767
$ (15998845)
Residual Land Value
Total
$
4,480,516
$ 6,012,869
$
9,943,574
$ 15,074,533
$ 9,724,292
$ 13,564,600
Change in Residual Land Value - $284,664 - $390,651 4291,392 - $433,413 - $186,392 - $312,992
Per BE Land Area - $12.65 - $17.36 - $12.95 - $19.26 -$0.28 - $13.91
Percent Change In Residual Land Value 80% -6.1% -2.8% -2.8% -1.9% -2.3%
Feasible? Yes Yes Yes Yes Yes Yes
HRBA Advlsam, ins.
Pa 14 8 Snmmer Test Tier 18 2 RLVNSN Feesvldhearmry
9 7- 242014
Appendix A
Physical Parameters
HR&A Amrsom, Inc.
Summer Test Ter 1 & 2 RLV Win FaesvIIA- Program
Page of8 7- 242014
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Prototype Name
Commercial
Commercial
Commercial
Commercial
RetaillResidential
R.mIgResidentlal
Location
Wflshire
WJShire
Dmvnimvt
Dmvntown
w1folde
Wishire
LUCE Area
LUCE Tier
1
2
1
2
1
2
Permit Requirement
DA
0 Parcels
3
3
3
3
3
3
Bldg. Height (Feet)
32
50
32
60
32
50
Stones ( #)
2
3
2
4
2
4
Land Arco s3F)
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg. Area (BE)'
39,000
57.750
45,111
76,222
40,125
59,521
Floor Area Ratio (FAR)- Gross Area'
1.73
2.57
2.00
3.39
1.78
2.65
Floor Area Ratio (FAR)-Net Area
1.50
2.25
1.74
2.99
1.50
225
Net Leasable Areas(SF)2
33,750
W.e25
39,250
67,250
33,750
50,625
Residential'
-
-
-
-
29,350
45,225
Retail
20,900
20,800
18,000
18,000
4,400
4,400
Office
12,950
29,825
21,250
49,250
-
-
Hotel
-
-
-
-
-
4 Hotel Rooms
-
-
-
-
-
-
ResidentialUnitMix
Office BE
12,950
29,825
21,250
49,250
-
-
Retail SF
2QUIX)
20,500
18,o00
18,000
4,400
4,400
Hotel SF
-
-
-
-
-
-
Reefilm ial BE Target
-
-
-
29,350
48,225
Estimate Units (based on avg, unit size)
-
-
-
40
64
Market Rate
Studio
-
-
-
-
475
475
1- BR(SF)
-
-
-
-
700
700
2- BR(SF)
-
-
-
-
1,600
1,000
studio
-
-
-
-
13
20
1 -BR (# units)
-
-
-
-
13
20
2- BR (6units)
-
12
19
Subtotal (# units)
-
-
-
-
38
59
Affordable
1- BR(SF)
-
-
-
-
600
600
2- BR(SF)
-
-
-
-
1,o00
1,000
1-BR (N units)
-
-
-
-
1
2
2 -BR ( #units)
-
1
3
Subtotal (# units)
-
-
-
-
2
5
Total Units
-
-
-
-
40
64
Parking
Residential
Market Rate QNd. avg. per unit)=
-
-
-
-
1.49
1.49
Akarnania(avg. pm.nip
-
-
-
-
LW
t00
Subtotal Sperms (9)
-
-
-
-
59
93
Retail
-
-
-
- -
2
5
Spaces /1,000 SF
3.3
3.3
33
3.3
3.3
3.3
Subtotal Spaces (#)
69
69
59
59
15
15
Office
Spaces /1,0005F
3.3
13
3.3
3.3
3.3
3.3
Subtotal Spaces (#)
43
98
70
163
-
-
Hotel
Spaces /Guest Room
0l5
0 .75
0.75
0.75
0.75
0]5
Subtotal Spaces (4)
-
-
-
-
-
-
Total Bourse
Number
112
167
129
222
74
108
Gross Area/Spgro(SF)- Surface
300
300
300
300
300
30D
Gross ArealSpece(SE) Subt.
350
350
350
350
350
350
Total Parking Are. (BE)
39,200
53,450
45,150
77,700
25,900
37,800
# Sudace
-
-
-
-
-
-
If SubLLevelsTotal
17
2.6
20
3.5
L2
1.7
Spamall-evels 1-2
112
111
129
111
77
112
SpaoaslLevels 3-5
-
56
-
111
(3)
(4)
Conabocfion Period (months)
16
18
18
18
18
18
' Per guidance provided by City Planning staff, basetl on recent development applications; emerging Downtmvn Specific Plan information;
and 2010 LUCE.
' Per HR&A, based on net -to -gross Roof area
assumptions (90% for retail; 87% for o(fiw and 85% for residential), and translation of total
gross floor area
to gross floor area per -Poor, based on: (1) street wall for first three Room; (2) assumed setbacks above 3rd floor.
3 Based on unit mix and net leasable floor
area by unit type, per City Planning Staff and HR&A.
4 Assumes 5% of Tier 1 and 7.5%, of Tier 2
units for 300A income households.
' Assumes 1.0 spacesAtudio; l.5 spaces /1
-BR unit and 2B s,ma sl2 -BR unit.
HR&A Amrsom, Inc.
Summer Test Ter 1 & 2 RLV Win FaesvIIA- Program
Page of8 7- 242014
Appendix A
Physical Parameters (con'd)
Prototype Name
Location
Grose Floor Area by Sicry
Site Area
Total Gross Bldg. Area
Total Floors
Floor 1
Fl oor 2
Floor 3
Floor 4
Floors
Floor 6
Total Gross Floor Area
FAR Gross Area
Net Floor Area by Stow
Floor 1
Floor
Floor
Floor
Floor 5
Floor6
Total
NeVGross Floor Area Overall
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
Commercial
Commercial
Commercial
Commercial
Retail /Residential
Retail /Residential
Wilshire
Wilshire
Dmvntown
Dmvnt.
Wilshire
Wishire
22,500
22,500
22,500
22,500
22,500
22,500
39,000
57,750
45,111
76,222
40,125
59,521
2
3
2
4
2
4
23,111
23,111
20,000
20,000
19,625
17.710
14,389
16,589
23,611
23,611
19,000
19,310
-
16,570
-
21,111
-
9,544
-
-
-
10,000
-
9,543
39,000
45,111
57,750
76,222
40,125
57,606
1.73
2.57
2.00
339
1.78
2.65
20,800
20,800
18,000
18,000
17,220
17,220
12,950
14,912
21,250
21,250
16,530
16,600
-
14,913
-
19,000
-
8,303
-
-
-
9,000
-
8,302
33,750
39,250
50,625
67,250
33,750
50,625
86.5%
87 .7%
87.0%
88.2%
90.0%
87.9%
Page Per e
HR osvIIAsars,loon
Summer Test ❑eri 82 RlV NA1M1 Feesvf /A- Program
1- 24 -2U14
Appendix B
Development Costs'
Per HRBA overall f n FIXt data and financial freesia, peer reviews of recent developments.
s 90 %x.lw1daled values, per Marshall & Son CCmme¢ial Cost Barber , 3m Quaker 2013; FARM Advisers, Inc., to account for grain hard wer and soft costs accounted for separately
BA nMlsor ;ma.
(qq( Sum m¢r_Le sl PxrlfltflLV WAn Fee sv lln -D¢v Ca
Pag. 4
1 '�OIB -24 -2014
MlxedUso
MixedUse
Mixedi
Mls.dLSe
MlxedLSe
MlxedLSo
Prototype Name
Assun n ons
Commercial
Commercial
Commercial
Commercial
RehliffResldentrA
ROWURe$Idenllal
Large,
Wdshire
Wilshire
Dmmtaxn
D.I.
w"Iftire
WkMro
.ad Area
n.WD
2zso0
22500
22500
22,500
z2ron
Gmas Bmg a.(.F)
39000
5],]w
45,111
76,222
40,125
59521
Net Leasable Neas(6F)
Residential
29,350
46.725
Retail
20,800
2D,B00
18,000
18,000
4,400
4400
OI( n
12950
29,825
21,250
a%250
-
-
Hurt l
Hotel Rooms
Subkuanean Radio,(apaced
112
167
129
M
]q
108
1-2Levels
112
111
129
111
71
112
35 Levels
-
56
-
111
(3)
(4)
Land COST
as RecrujOValue
see Residual Value
see
Residual Value
see Resltlual Value
see
ResWUal Value
see
Resltlual Value
Ham coat
(eadmderr Type
V
V
v
v
V
V
Building ConsLUGaNG$If
Vegas
$187
$181
$1]]
Sir.
$116
$131
OermbrrSrte Improvements
$15
par LandArea
$ 33],500
$
331,5.0
$
331,500
S 331,50)
$
331
$
331,500
(A Site Improvements
$100.000
Aft-mr.
$ 1001000
$
100000
$
100.000
$ 100.0))
$
1OD,000
$100.000
Building COre S Shell
Vedea
is 8,507,540
$
10,461990
$
7,997,729
$ 14,485,900
$
4638,845
$
].]96.656
Retail Tenant lmprovermnis
$i5
.Net Leasable &F
$ 728,000
S
720,000
$
630,000
$ 630,000
$
154,0.0
$
154 000
Office Tenant Improvements
$30
.Net Leasable SF
$ 300,500
$
694,150
$
637,500
$ 1.471,500
$
-
HoIeIFFBE
$25.000
xRooms
$ -
$
-
$
-
S -
$
-
$
-
Subterranean Parent
Selace
55000
per0pace
$
$
$
S
$
$
1 -2 Leval,
$30.000
p.,$pam
$ 31360.000
$
31340,000
$
3810000
$ 3,330,000
$
2310000
$
3.380.000
3 < levels
$ewer¢,
per Space
S
$
1.948.333
$
$ 3,¢65,000
S
(105,000)
S
(140,000)
CeWneency
4%
x$aRotor Hard Cost
$ 450.062
$
112.423
$
542.909
S 970236
$
297.334
S
464,326
.migal Hand COS1s
$ II.M.A02
$
18,522,996
S
14.115,63B
S 25,226,138
$
7,735879
$
12,072482
Soft Costs
Nel PgRolen -]fee Fee
Sea As,0
$ 214.432
$
405.670
S
2]y55S
S 595,470 . S
S
Net Affordable Housing linkage Fee
See App .D
$ 44192
S
87,995
$
59T19
$ 132914 R $
1]],343
S
297,162
Nut TIF Fee
Co. A,p.0
$ 421,315
S
632,112
$
341.675
$ 651,499 N $
S
(Wer CBy Perm's S Fees
See Art,C
$ 408.940
$
645.276
$
408,303
$ ]52,]62
S
313,058
$
530204
thus Community Bernelds Cost
Allovances
$
$
$
$
S
$
ABElgher Professional,
6%
xHard Cost,
$ ]12,]04
$
1.111.380
$
845838
$ 1,513,568
S
463,841
S
724,349
AfarketingM1easing Carte ens
Residernal
$1.50
x Net Leasable$F
$
$
$
$
$
220.125
$
340808
RelaNOlix.
$3DD
xNet Lea,e We SF
$ irl...
$
151.875
$
11].]50
$ 201.750
S
Ilft.
S
13,200
Legal B Aaound,
1%
xHard Costs
$ 110,104
$
185,230
$
141,156
$ 252,261
$
11,301
S
120,]25
Taxes B Insurer.
1%
xHow Cosh
$ 118,104
$
105,230
$
141.150
$ 252.261
$
11.307
$
120,126
PIeOPenl09 Ex ... sea
SUM
xNet Leas able SF
$
$
$
$
S
$
D..I.per Fee
3%
xHard Costs
$ 355352
$
555,690
$
41
$ 755184
S
231,B20
$
352,114
Contingency
3%
x Sublalal SOB Costs
$ ]5.)83
$
118,814
$
¢4.562
S 153.450
$
47,223
$
]6,45]
.bled SOB Costs
$ 2,5]],844
$
9,0]9,2]1
$
290],856
$ 5165726
$
1,621,324
S
2590,683
$ubtmai Ford ..0. Cade
$ 14.468,248
$
22.601
$
17)19.604
$ 30494.882
S
9,3520D3
$
14.083.166
Financing Costs
Loan Tend (month,)
18
Average Loan Balanre
.,be%
Cochadin Loan lnlereat Rare
550%
Consumer -Laos Interest
$ 115216
$
1,212,041
$
912,616
$ 1,635,281
$
601,5)1
$
186,312
Cwham,OOn Loan Fees
150%
$ 216.844
$
339034
$
255294
$ 457.423
$
140,290
$
219,947
(leapfrogged Pmfad Value
Per App E
Permanent Lean Percent. Value
6500%
Permanent Lean Fees
150%
$ 224,665
$
339926
$
531,071
$ 531,11
$
222.192
$
329,421
Subtotal Financing Costs
$ 1,216,626
$
1,891,007
$
4,705,041
$ 2,629,181
$
063,.13
$
1,335Sdm
Torsi Development Coal
Herds 3olle Hearst,
$ 15,812¢]2
5
24,493,214
$
16,124,851
$ 33,124,649
$
10215,9]6
5
15,998,845
par GSF
$ 40187
$
424.13
$
416.08
$ tilde.
$
25dfi0
$
26879
Per HRBA overall f n FIXt data and financial freesia, peer reviews of recent developments.
s 90 %x.lw1daled values, per Marshall & Son CCmme¢ial Cost Barber , 3m Quaker 2013; FARM Advisers, Inc., to account for grain hard wer and soft costs accounted for separately
BA nMlsor ;ma.
(qq( Sum m¢r_Le sl PxrlfltflLV WAn Fee sv lln -D¢v Ca
Pag. 4
1 '�OIB -24 -2014
APpendixC
Proposed New Fees, Existing City Fees $ Permit Costs
Planning PerrmW
Development Review
$15,558
Mixed Use
htixedLSO
Mixed -Use
Mixed-Use
Mw.dbU.o
Mixed Us.
Pmetype Name
Ass mnfon
Commercial
Commercial
commercial
Commonest
R.Lai0Resldentml
RetelOResldential
reach.
$
WhIos
WNW.
Dnvmlcvm
Ommlovm
LMamre
Wilehhe
Land Area
$ 1,684
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg.&an(SF)
$
39,000
57,750
45,111
76,222
40,125
59,521
Reeldentisi Units
$226
per project
$
226
$ 226
$ 226
$ 276
Markel Rate
$ 276
CEOA
Shades
Categorical ExampYOn
$14,622
13
20
1 -BR
$ 14,622
S 14,622
$ 14,622
$ 14,622
$ 14,622
13
20
2 B
$
-
-
-
-
12
19
Adorable
$200.000
per project
$
-
$ -
$
$
1 -BR
$
-
-
.leasable area
-
1
2
2 S
$ 18,266
-
-
-
-
1
3
Realden0al(Net Leasable 6F)
-
29,350
46,225
Robot (Met Leasable SF)
$
20,800
20,800
18,000
10000
4,400
4p00-
Office (Net LeaaableSF)
$0.51
12,950
29,825
21,250
49,250
-
-
Notel(NelLeasableSF)
$ 2,244
-
-
260,415
-
New Affordable Hag. Linkage Fee'
WA WA $
214,432
$ 405,670
$ 273,559
$ 595,470
$ - $
-
NewPadts Fee'
NIA WA $
44,192
$ 82,995
$ 59,179
$ 132,914
S 177.343 $
297,162
TIF Feese
$
422,315
$ 632,112
$ 342,875
$ 652,499
$ - $
-
Planning PerrmW
Development Review
$15,558
per project
$
-
$ -
$
$ -
$ -
$ -
Development Agreement
$25,000
per project
$
-
$
$
$
$
$
Multiple Permit Fee
$1684
per puJaN
$
1,544
$ 1,684
$ 1,684
$ 1,684
$ 1.684
$ 1,544
Architectural Bouice, Board
$1,684
per project
$
20,OOD
$ 1,684
$ 1,684
$ 1,684
$ 1,684
$ -
Coastal Zone Concept Reelew
$226
per project
$
226
$ 226
$ 226
$ 276
S 226
$ 276
CEOA
Categorical ExampYOn
$14,622
per project
$
14,622
$ 14,622
S 14,622
$ 14,622
$ 14,622
$ 14,622
Negagve DeGaaBOn
$25,445
per project
$
-
$ -
$
$ 81,540
$ 19,932
-
EIR
$200.000
per project
$
-
$ -
$
$
5
$
Subtotal
$3.18
.leasable area
$
16,442
$ 18,266
$ 18,266
$ 18,266
$ 1$266
$ 16,442
Other Requirements'
Midgatlon Fee on Office Space
$10.00
xleasableam. >l NK
$
-
$ -
S -
$ -
$ -
$ -
Recreational Part Tex
$]DO
xurtrts
$
-
$ -
$ -
$ -
$ -
$ -
Me Fee
New ResidentiaVCOmme¢Ial
1.00%
x$20015F
$
20,OOD
$ 115,500
S 90,222
$ 152,444
$ 60,250
$ 119,042
Tenant Improvements
1.00%
x$SOISF
$
16,825
$ 25,313
$ 19,625
$ 33,625
$ 2,200
$ 2,200
Chld Cam Fee
Market Rate Residamal
$133.40
parenit
$
$
S
$
$ 5,072
$ $975
RaWl
$463
.leasable am.
$
94,224
$ 94,224
$ 01,540
$ 81,540
$ 19,932
$ 19,932
Office
$6.34
.leasable area
$
82,103
$ 189,091
S 134,725
$ 312,245
$ -
$ -
Hotel
$3.18
.leasable area
$
-
$ -
$ -
$ -
$ -
$ -
School Fae6NesFee
Residen9al
$320
.leasable area
$
$
$
$
$ 93,920
S 147,920
Commerdal
$0.51
xleasable area
$
17213
$ 25.819
S 20.010
$ 34,228
$ 2,244
$ 2,244
Subtotal
1,
260,415
$ 449,947
41 346,130
$ 614,162
$ 203,618
$ 29%213
BIdg.iCOnslmdion Polmlls'
Plan Check
Residential 4. stories
$09127
xleasable area
$
$
$
$
$
$ 42,190
Commercial I OK SF
$11790
xleasable area
$26,603
$26,603
$23.022
$12,790
$5,628
$5,628
Commercial 11 OK SF14 clerics -
$1.3621
xleasable area
$
$14,711
$
$
$
$
Mechanical
$727
per project
$727
$727
$727
$727
$727
$727
FJecNCal
$727
per project
$727
$727
$727
$727
$727
$727
Prancing
$727
no, ".Joel
$727
$727
$727
$727
$727
$727
BmIding Permielue ecAmis
Mum land, 4+ Stodas
$1.0236
xleasable area
$
$
$
S
$
$ 47,316
Commercial l -$lory
$07782
xleasable area
$
16,187
$ 16,187
$ 14,008
$ 14,008
$ 3,424
$ 3,424X8
Commercial 4+ stories
$13581
xleasable area
$
$ 40,5D5
$ -
$
$
$
Tenantlmpms ... nee -10K SF
$03490
xleasable area
$
7,259
$ 7,259
$ 6,282
$ 3,490
$ 1,536
$ 1,536
TenanUmpmvermal, >10K SF
$02732
xleasable area
$
31538
$ 8,149
$ 5,806
$ 13,455
$ -
$ -
G- Wohnical Reports
$2,981
per projeq
$
$
$
$
$
$
Subtotal
$
65,760
$ 115,594
$ 51,299
$ 46,924
$ 12,769
$ 102,278
Utility Fees
Water Meters
$3,837
314'meler per project
$
3,837
$ 3,837
$ 3,837
$ 3,837
$ 3,837
$ 3,037
Ftaline Were
$18,195
4' male, per project
$
18,195 -
$ 18,195
$ 18,195
$ 18,195
$ 18,195
$ 18,195
Wastecater Capital Farplies
SNdoll -BR Units
$1,168
pa, writ
$
-
$ -
$ -
$ -
$ 32 .704
$ 52,660
2 -BR Units
$1,557
p,, unit
$
$
$
$
$ 20.241
$ 34,254
Concerned
$779
per 1,000 leasable OF
$
26,291
$ 39.437
$ 30576
$ 52,388
$ 3,428
$ 3,428
Subtotal
$
48,323
$ 61,469
$ 52,608
$ 74,420
$ 78,405
$ 112,274
per GSF
$10.49 If
$11.17
$10.39
$9.89
$7.80
$8.91
r See Appends Dfor caleulaAOn details.
e Per are Ordinance No 2420(CCS), adopted Mooch 12, 2011 Assumes TIF credit for existing retail on 50% ofcta area.
a Per Cilysll3l4 us slutlyrec mentla0ons. Assumes feecredBS for exsting retail an 50 %o(sile ema.
° Per de201a., and achedulea.
'
Includes meter and capilalfacilNes <M1arges.
,L HRSA Pdvival Ina.
1 Summer Tesl Terl a2fl LV NSIM1 Fe a svllCtity CO 1Da.a
Page f0 7- 241.14
Proposed TIFINew, Parks /Recreation and Afforable Housing Linkage Fees
AREA Advisers, Inc.
Summer Test Ter I E2 RLV Ntlh Feervt(0. Fee Analysis
Paue put 0 7-242014
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
M111xed -Use
Mixed-Use
Pmlolype Name
Commercial
Commercial
Commercial
Commercial
RrdmVResidential
Retal/ResWentidl
Location
Washita
Arshim
Dpvmlown
Downtown
Wlsbire
Wishile
LUCETier
1
2
1
2
1
2
Land Area
22,50D
22,500
22,500
22,500
22.500
22,500
Gross Bldg. Area (SF)
30,000
57,750
45,111
76,222
40,125
59,521
pestilential Unlls
-
-
-
-
40
64
Market Rate
Studios
-
-
-
-
13
20
FBR
-
-
-
-
13
20
2 Bit
-
-
-
-
12
19
Affordable
1 -BR
-
-
-
-
1
2
2 U
-
-
-
-
1
3
Residential (Not Leasable BF)
-
-
-
29,350
40,225
Retail (Net Leasable SF)
20,800
20,000
18,00D
10,000
4,400
4,400
Office (Net Leasable SF)
12,950
29,025
21,250
49,250
-
-
Hotel(NelLeasable SF)
-
-
-
-
-
-
Floor Area Attributable to Tel2
Office
-
14,912
-
28,000
-
Residenlial
-
-
-
-
-
16,605
Total Units
-
-
-
-
-
24
Markel Rate Units
-
-
-
-
-
22
Studies
0
1 -BR
7
2 -BR
7
Affordable Units
2
1 -BR
I
2 -BR
1
Assumed Exomm Retel(50 %xsite
area SF)
11.250
11.250
11,250
11,250
11.250
11,250
Fee Factor
'1.141
1.14
_. 1.14
119#
TIF Fees'
Market Rate -Area 1
$2,600 per unit
$ -
$ -
5 -
5 -
$ -
$ -
Market Rate Area 2
$3,300 per and
$ -
$ -
5 -
5 -
$ 125.400
$ 200,691
Affordable
Sees per mat
5 -
S -
$ -
$ -
$ -
S -
Retail Area 1
$21.00 xleasable area
$ -
5 -
$ 378,000
$ 370,000
$
$ -
Retail Arco 2
$30.10 xleasable area
$ 628,080
S 626,080
$ -
$ -
$ 132,440
S 132,440
Office Area 1
$9.70 xleasable area
$ -
5 -
$ 205,125
$ 515 .749
$ -
5 -
Office -Area2
$10.80 xleasable area
$ 139,860
$ 344,651
$ -
$ -
Hotel Arco l &2
$350 xleasable area
$
$
$
$
$
Is
Subtotal
$ 765,940
$ 970.737
$ 584,125
$ 893,749
$ 257,840
$ 341,131
Less: Fee on 50% Exlsiin0 Retail SF
Am. 1
$21.00 xleasable area
$ (236,25D)
$ (230,250)
Less: Fee on 50% Exlsiln0 Retail SF
Area 1
$30.10 xleasable area
S (338,625)
5 (338,625)
$
$
$ (330,625)
5 (330.625)
NET TIF Fee
$ 421,316
$ 632,112
$ 347,876
$ 657,499
$
$
Proposed ParkslRecamAlon Fee
259: x Maximum Fees
Assumptions
Market Rate Housing
25%
0 -1 Due
25%
$16,554 per unit
$ -
5 -
$ -
$ -
$ 107,601
$ 174.231
21 BRS
25%
$26,051 per unit
$ -
S -
$ -
$ -
5 79,983
$ 133,171.70
Affordable Housing
$0 per unit
$ -
$ -
$
$
$ -
$ -
Relml
25%
$5.98 xleasable area
5 31,096
$ 31,098
$ 26,910
5 26,910
5 6,578
$ 8,578
Office
25%
$9.24 xleasable area
$ 29,915
5 73,718
$ 49,088
$ 122,823
S -
$ -
Hard
25%
$12.52 xleasable area
5
$
$
$
$
$
Subtotal Fee
$ 61,011
$ 104,814
$ 76,998
$ 149,733
$ 194,162
$ 313,981
Less: Fee on Existing Retail SF
Retail
25%
$5.98 xleasable area
$ (16,819)
5 (16,810)
$ (16,819)
$ (16,819)
$ (16,819)
5 (16,819)
Office
25 -A
$9,24 xleasam area
$
$
$
3
5
3
Net Fee
$ 44,192
$ 87.996
$ 69,179
$ 132,914
4 177 343
$ 297,162
Proposed Affordable Housing Linkage Fee
4.5%x Maximum Fees
4.5%
Assumptions
Resign
4.5%
$195.07 xleasable area
$ 102,586
$ 182,586
$ 150,007
$ 158,007
5 38,624
$ 38,624
Orrice
4.5%
$224.11 xleasablearea
$ 130,600
$ 321.838
$ 214,305
$ 536,217
$
$ -
Subtotal Fee
is 313,186
$ 504,424
$ 372,312
$ 694,224
$ 38,624
3 38,624
Less: Fee on Posting Retail SF
Retail
4,5%
$195.07 xleasable area
$ (98,754)
S (98,754)
$ (98,754)
$ (98,754)
$ (98,754)
$ (98,754)
OIOCe
4,5%
$224.11 xleasable area
5
$
$
$
5
$
Net Fee
Is 214.432
$ 405670
$ 273,658
$ 695.470
$
3
Combined New Fees
3 606,939
$ 1,126777
$ 080,612
$ 1,$86882]
$ 177,343
$ 297162;
Fees Per GSF
$ 17.69
$ 19.49
$ 15.09
$ 18.18
$ 4.42
$ 4.99
Total Development Cost
$ 20,474.415
$ 30,847,408
$ 29,101,273
$ 48,995,000
$ 20,584,772
$ 30,485,116
Fee as %Law Cost
3.4%
3.6%
2.3%
2.8%
8.9%
t0%
AREA Advisers, Inc.
Summer Test Ter I E2 RLV Ntlh Feervt(0. Fee Analysis
Paue put 0 7-242014
Appendix E
Net Operating Income
Net Sinnott, income $ - $ - $ - $ - 5 1,055,014 $ 1,845,361
For -Rent Residential - Affordable (30% Imamx °
1 E RenWnff/Month
5 - $
2 -BR ReniNniVMOnth
Mixed -Use
Mixed Us.
Mixed -Use
Mixed Use
Mixed -Use
Mixed -Use
Prototype Name
Ass9mnthme
Commercial
Commercial
Commercial
Commercial
RetaiORsaidenfial
RetaillResiden(iai
Location
- $
%912
t48lshire
VWKWun
Seems..
Searswn
1M1415M11re
todlshire
Land Area
5 251
3.0% xEGI
22,509
22,500
22,590
22,590
22,500
22,500
G., Ric, Area (SF)
$ $
$
39,000
5],]59
45,111
76,222
40,125
59,521
Residential Units
- $
- $
-
-
-
-
40
64
Market Rate
(14000)
$ (35.00)
-
-
-
-
38
59
Studio
-
-
-
-
13
20
1 O
-
-
-
-
13
20
2 BR
-
-
-
-
12
19
AffoNabie
-
-
-
2
5
1 -BR
1
2
2 BR
-
1
3
Retail (Not Leasable SF)
20,600
20,800
18,000
18,000
4,400
4,400
Ones, (Met Leasable SF)
12,950
29,825
21,250
49,250
-
-
Hotei(NetLeasableSF)
-
-
-
parkMg Spaces
112
167
129
222
74
108
Residential
-
-
-
59
93
Retail
69
69
59
59
15
15
Office
43
90
70
163
-
-
Helel
0
0
0
0
0
9
Forrvfoot Residential Market Rater
Studio RenWniVMOnIM1
Vanes
$0
50
$o
$0
$2,043
$2,043
1 -SR RenWnNMOntb
Vanes
$2,945
$2,945
$3,100
$3,100
$2,945
$2,945
2 BR Ren1A1n8/Mi
Vents
$3,800
$3,809
$4,000
$4,000
$3,BO9
$3,600
Units McOrel9ear
$
- $
- $
-
$ -
$ 1,325,328
$ 2,063,520
Offer Income
5.0%
%Units Income $
$
5
$
$ 66,266
$ 103.1]8
Gross Income
$
- $
- $
-
$ -
$ 1,391,594
$ 2,166,695
Less Vacancy&ColleGlan Loss
5.0%
%Gress Income 5
$
$
$
$ (69,580
$ (106 335)
Effective Gross Income (EGO
$
- $
- 5
-
$ -
It 1,322,014
$ 2,050,361
Less: Operating Expenses (Intl. reserve)'
$ 7.000
xUnit $
$
- 5
-
$ -
$ (266.000)
$ (413.00)
Net Sinnott, income $ - $ - $ - $ - 5 1,055,014 $ 1,845,361
For -Rent Residential - Affordable (30% Imamx °
1 E RenWnff/Month
5 - $
2 -BR ReniNniVMOnth
$
Units lncomeffear
389
ONar Income
1.0%
Groan Income
- $
Less : Vacancy &C011eGlan LOSS
5.0%
Effective Gross Income (EGO
$ 437
Less: Operating Expenses (Ina reselva) 1
S 7,000
Halogenating income
Retail°
Average ReaC FIMorah(NNN)
Gross Rental lnermaNcer
Less: Vacency&Collectloo Loss
Effective Gross Income (EGO
Less: Unreimbamed Operating Expenses
Net Operating Income
office,
Avert, ReneSFIMONb(NNN)
Gress Rental Anomefyear
Pallor, lnexi
Loss: Vacancy, &Collection Loss
Effective Gross Income (EGO
Less: Unrehebumed Operating Expenses
Less: Parking Expense
Net Operating Income
Total Net Operating Income
Vedas
5 - $
- $
$
- S
389
5 389
5 - $
- $
- $
- 5
437
$ 437
5.0% xGmss Income
$ - 5
- 5
- $
- $
%912
5 25,08
x Units Income
It $
5
$
$
99
5 251
3.0% xEGI
5 - 5
- $
- $
- 5
19,011
$ 25,319
x Gross Inc...
$ $
$
$
$
(501)
$ (1266)
xPading income
$ - $
- S
- $
- $
91510
$ 24,053
x Unit
It $
5
$
$
(14000)
$ (35.00)
$ - $
- $
- $
- $
(4.490)
$ (10,947)
Vedas
$ 4.00
$ 4.00
$ 525
$ 525
$ 4.00
$ 4.00
5 998,400
$ 998,400
$ 1,134,000
$ 1,134,000
$ 211,20
$ 211,200
5.0% xGmss Income
$ (49.920)
$ 149920)
$ (56700)
$ (56.700)
$ (tg56o)
$ (10560)
xGross Income
$ 990,480
$ 948,480
$ 1,077,300
$ 1,077,30
$ 200,640
$ 200,840
3.0% xEGI
S 28,459
$ 23,454
$ 32.319
$ 32319
5 SCHE
$ 8018
xEGI
$ 920,028
$ 920,026
$ 1,044,901
$ 1,044,981
$ 194,621
$ 194,621
� InstBUte of Real ESlale Managvmonl annual operalitg cos(dala for epadmenl6uiMings in Los Angeles County
Per HRBA mvlew of maAet tlala and finenGai feasibility peer reWews of rewnl tlowlopmenis. Assumes VJilsM1ire resitlential rents= 95Be xtlowntown.
a Per Glyn rentsrecuth eantl d(10fsepiply);
° Assumes 5200fm9nIM1 reservetl (10 %of supply); $165ImonIM1 unreserved (85 °6); and 55991m0nih daily use (5 %).
HRdAAdvlsms, Ins.
6losts, lest Tier 162 RLV Wan 1sxW E -Net Ops [..me
Page ofb 1- 242914
$ 3.75
$ 3.75
$ 4.30
$ 4.30
$ - $ -
5 582,750
$ 1,342,125
$ 1,096,50
$ 2,541,30
$ - $ -
$2,223 Md. Atgrepaceff,
$ 95,589
$ 217,854
$ 155,610
$ 352,349
$ - $ -
5.0%
xGross Income
$ (291381
5 (67.108)
$ (54025)
$ (127065)
$ $
$ 649,201
It 1,492,873
$ 1,197,285
$ 2,775,504
$ - $ -
3.0%
xEGI
$ (19,476)
$ (44,786)
$ (35,919)
$ (83,298)
$ - $ -
50.0%
xPading income
$ (477951
$ (100.927)
$ 177.805)
$ (181175)
$ $
$ 581,930
$ 1,339,160
$ 1,083,561
$ 2,512,111
5 - $ -
$ 11501,956
$ 2,269,186
$ 2,120,542
it 3,557,092
$ 1,246,145 $ 1,029,035
� InstBUte of Real ESlale Managvmonl annual operalitg cos(dala for epadmenl6uiMings in Los Angeles County
Per HRBA mvlew of maAet tlala and finenGai feasibility peer reWews of rewnl tlowlopmenis. Assumes VJilsM1ire resitlential rents= 95Be xtlowntown.
a Per Glyn rentsrecuth eantl d(10fsepiply);
° Assumes 5200fm9nIM1 reservetl (10 %of supply); $165ImonIM1 unreserved (85 °6); and 55991m0nih daily use (5 %).
HRdAAdvlsms, Ins.
6losts, lest Tier 162 RLV Wan 1sxW E -Net Ops [..me
Page ofb 1- 242914
Appendix F
Residual Land Values
' Per Real Estate Research Corp., Real Estate Report 3N Quarter 2013, LOS Angeles Area data
s f0 -15% typical, per HR&A.
HRBA Achl Inc.
6ummer_Teet Tier 1 & 2 RIM Win FeesvIT- Resltlual Val fees
Peg6 8 of 8 7 -24 -2014
Mixed-Use
Mixed -Use
Mixed Use
Mixed -Use
Mixed Use
Mixed-Use
Pmlolype Name
Assumptions
Commercial
Commercial
Commercial
Commercial
RetalflResideotlal
RetaiYftesidential
Location
Wilshire
Within
Dnwnlmvn
OmvNmvn
Wilshire
Wilshire
Land Area
22,500
22,500
22,500
22,500
22,500
22,500
Gross BMg. Area (SF)
39,000
5],]50
45,111
76,222
40,125
59,521
Resldeniiei Units
MaAel Rate
Chad a
-
-
-
-
13
20
i -OR
-
-
-
-
13
20
2 -BR
-
-
-
-
12
19
AboNable
i -OR
-
-
-
-
1
2
2 -BR
1
3
Retail Mel Leasable BF)
2D,B00
20,800
18,000
10,000
4,400
4,400
Olfco (Net Leasable SF)
12,950
29,825
21,250
49.250
-
-
Hotel (Net Leasable OF)
-
-
-
-
-
-
Ppepct Value
Residential Markel Ends
Net Operating Income
From App,E $
-
$ -
$ -
$ -
S 1,056,014
$ 1,645,361
Cap Rate
5.30%
Value
NOPCap Rate $
-
$ -
$ -
S -
$ 19,924,792
S 31,044,50.)
Residential - Affordable
Net Operating Immune
From App,E $
-
$ -
$ -
$ -
$ (4,490)
$ (10,947)
Cap Rate
5.30%
Value
NOgCap Rate $
-
$ -
S -
$ -
$ (84,]1])
$ (206,547)
Relag
Net Operating Income
From App,E $
920,026
$ 920,026
$ 1.044,981
$ 1,044,981
$ 194,621
$ 104,621
Cap Rate'
6.60%
Value
NOUCap Rale $
13,939,788
$ 13,939,788
$ 15,833,045
$ 15,833,D45
$ 2,948,803
$ 2,948,803
Off.
Net Opemgng lemma
From App,E $
501,930
$ 133$160
$ 1,083,561
$ 2,512,111
$ -
$
Cap Rate'
6.40%
Value
NOUCaP Rate $
9,092,658
$ 20,924,375
It 16,93D,641
$ 39,251,734
$ -
$ -
Total ProjectVel9e
$
23,032,444
$ 34,864,163
$ 32,763,656
$ 65,084,]]9
$ 22,]88,8]8
$ 33,786,803
Residual Land Value Estimate
Total Project Value
From above $
23,032,444
$ 34,664,103
$ 32,763,686
$ 55,084]]9
$ 22,769,678
$ 33,786,803
Less: Developer Polar
12.50%
x Total Project Value $
(2,079,056)
$ (4,358,020)
$ (4,095,461)
$ (6,865,597).
$ (2040,610)
$ (4,223,350)
Less: Total Development Cast
From App,B $
(156]28]2)
$ (24493274)
S (18,724.8511
$ (33,124.649)
$ (10,215.9
$ (15998845)
Residual Land Value
Total
$
4.480,616
$ 6,012,869
11 9,943,574
$ 15,074,533
$ 9,724.292
$ 13,504,608
Per OF Land Area
$
199.13
$ 26734
$ 441.94
$ 669.98
$ 432.19
$ 60287
' Per Real Estate Research Corp., Real Estate Report 3N Quarter 2013, LOS Angeles Area data
s f0 -15% typical, per HR&A.
HRBA Achl Inc.
6ummer_Teet Tier 1 & 2 RIM Win FeesvIT- Resltlual Val fees
Peg6 8 of 8 7 -24 -2014
Return an CostlDeveloper Profit Margin
Results Summary -Tier 1 & 2 Development Prototypes (Will, AddYPees)
Program Summary (see App. A)
Net Operating Income (NON (see App. E)
-11.2%
Mixed -Use
8.1%
Mixed Des
-66%
Mixed Use
Mixed -Use
mixed Use
You
Micutruee
Prototype Name
Residential - Market Rate
Commercial
Relom on Total Development Cost
Comnterdal
Commercial
Commercial
RetaNeesidential
Retailmusidential
Location
$ 1,501,956 $
Whirl.
Effective Gross Income
Vbishire
-
Drones".
Downtown
VblShirs
-
Wish re
LUCE Tier
1,322,014
1
2,050,361
2
$
1
2
1
$
2
Parrun Requirement
$
(266.000
$
(413,00
Net Operating inrome
$
-
$
-
$
kPamela
$ -
3
1,056,014
3
1,645,361
3
3
3
3
Bldg. Height (Feet)
32
50
32
60
32
-
50
Stories (9)
$
2
5 -
3
9,510
2
4
2
$
4
Site Are. 3F)
22,500
22,500
$
22,500
22,500
22,500
Net OponlOg Toronto
22,500
Gross Bog. Area (SE)
$
39,000
$
57.750
$ -
45,111
76,222
40,125
(10,947)
59,521
Floor Area Bell. (FAR) -Gross Area
1 .73
2.57
200
339
1.70
265
Floor Area Ratio(FAR) - Net Area
$
1.50
$
2.25
$
134
2.99
1.50
200,640
225
Net leasable Areas
Less: Operating Expenses
$
(28,454
5
(20454)
$
(32,319
5 (32.319)
$
(6,019
ResldenGal(ST,
(6,01
-
$
-
$
920,026
-
29,350
$ 1.044,981
46,225
Markel Rate Units
$
-
Office
-
-
-
36
59
AgoNebts furs
-
-
$
649,201
$
2
$
5
Total Units
S
-
$
-
Less: Operating Expenses
$
-
40
(153713)
64
Retag(SF)
$ (264.473)
20,800
20,800
18,000
18,000
4,400
$
4,400
O(6ce mF)
1,083,561
12,950
$
29,825
$
21,250
49,250
-
-
Hotel (SF)
Bill Gross Income
$
76 250
Development Costs (see App. B&C &O)
-
$
-
$
$
-
$
Less: Operating Expenses
$
Land Costs
$
4,765,160
5
8,403,520
$
10,239 966
5 15,507,946
$ 9,910,684
$
13,877,599
Hard Costs
$
11,876.402
$
10,522,996
S
14,115,638
5 25,228,135
$ 7,730,679
5
12,072,482
Son Casts
$
1,462,957
$
2,308,219
5
1,755,051
$ 3,130,074
$ 1,130,915
$
1,763,702
Net ParkslRuses.1ion Fee
$
44,192
5
87,996
$
59,179
If 132,914
$ 177,343
5
297,162
Net Affordable Housing Linkage Fee
$
214.432
$
405,670
5
273,668
s 695,470
$ -
$
-
TIF Fee
$
427,315
$
632,112
$
347,876
5 657,499
$
$
-
OlherChy Costs (eeeApp.E)
$
400,948
$
645,275
$
460,303
$ 752,486
$ 312,782
$
543.04
Other Suit Costs
$
530%
$
-
$
$
5
$ -
$
-
FinancingCosts
$
1,543.636
$
2,330,440
$
2,169791
5 3.694.000
$ 1,544,074
$
2,288,935
Total Development Cost
$
20,765,062
$
31,336,235
5
29,444,361
$ 49,696,524
$ 20,006,477
5
30,842,884
par GSF.
$
$532
5 -
$543
(4,490)
$653
$652
$519
$518
Net Operating Income (NON (see App. E)
-11.2%
-10.0°5
8.1%
-7.4%
-66%
-10.0%
Fascias.?
Marginal
You
Marginal
Marginal
Residential - Market Rate
Marginal
Relom on Total Development Cost
NOI
$ 1,501,956 $
2,259,186
Effective Gross Income
$
-
$
-
$
-
$ -
$
1,322,014
$
2,050,361
Less: Operating Expenses
$
7.23%
$
5.99%.
$
Return on Cast No Fees
5
$
(266.000
$
(413,00
Net Operating inrome
$
-
$
-
$
-
$ -
$
1,056,014
$
1,645,361
Residential- Affordable
Effective Gross Income
$
-
$
-
$
5 -
$
9,510
$
24.053
Less: Operating Expenses
$
$
$
5
$
(14000)
$
(35,000
Net OponlOg Toronto
$
-
$
-
$
-
$ -
$
(4,490)
5
(10,947)
Relaii
Effective Grass Income
$
940,480
$
940,480
$
1,077,300
5 1,077,300
$
200,640
$
200,640
Less: Operating Expenses
$
(28,454
5
(20454)
$
(32,319
5 (32.319)
$
(6,019
$
(6,01
Net Operating Income
$
920,026
$
920,026
S
1,044,981
$ 1.044,981
$
194,621
$
194,621
Office
Effective Gross Income
$
649,201
$
1,482,873
$
1,197,285
5 2,776,584
S
-
$
Less: Operating Expenses
$
(67,271)
5
(153713)
$
(113724)
$ (264.473)
S
$
Net Ornstein, Income
$
581,930
$
1,339,160
$
1,083,561
$ 2,512,111
$
-
$
-
Hotel
Bill Gross Income
$
-
$
-
$
-
$
$
-
$
Less: Operating Expenses
$
$
$
5
$
$
Not Opemling Income
$
$
-
$
-
$
$
$
.
Teal Net Operating Income
$
1601966
$
2,269.186
$
2,128,642
$ 3657092
$
1,246.145
$
1828035
Project Component Values (see App. F)
Residential Markel Rate
Not
$
$
-
$
s -
$
1,056,014
$
1,645,361
Cap Rate
530%
5.301k
5.30%
5.30%
530%
5.30%
Valve
$
-
$
-
$
-
$ -
$
19,924,792
$
31,044,547
RuMdenllabAffordable
NOI
$
-
$
$
-
5 -
$
(4,490)
$
(10,947)
Cap Role
5.30%
5.30%
530%
5.30%
5.30%
5.30%
Valve
$
-
$
-
$
-
$
S
(84,717)
$
(200,547)
Relaii
NOI
$
920,026
$
920,D36
$
1,044,901
$ 1,044,981
$
194,621
$
194,621
Cap Role
660%
6.60%
660%
6.60%
6.60%
6.80%
Value
$
- 13,939,788
$
13,939,788
$
15,033,045
$ 15,833,045
$
2,940,003
$
2,948803
Ounce
NOI
$ _
581,930
$
1,339,160
$
1,003,561
$ 2,512,111
S
$
-
Call Role
6.40%
6.40%
BAD%
6.40%
6.40%
6.40%
Value
$
9,092,658
$
20,924,375
$
16,930,641
$ 39,251,734
$
-
$
-
Ha1el
NOI
$
S
-
$
$
S
-
$
Cap Rate
790%
7.90%
790%
7.90%
7.90%
TWITI,
Value
$
$
$
-
$
$
$
.
Total Project Value
$
23,032,444
$
34,884,163
$
32,763.686
$ 55.084,779
S
22,788,878
$
33.786,803
Developer Returns
Developer Pont
Total Project Value
S
23,032,444
$
34,004,163
$
32,763,606
5 55,084,719
$
22]88,870
$
33,786,003
Less: Tulal Development Cost
$
(20765062)
S
(IT330235)
$
(29444361)
$ (49.696,524)
$
(20.806.47➢
$
(30842084)
Proud
$
2267,382
$
3,527,928
5
3,319,325
$ 5,308,255
$
1,962,401
$
2,943,919
Change In Profit
-11.2%
-10.0°5
8.1%
-7.4%
-66%
-10.0%
Fascias.?
Marginal
You
Marginal
Marginal
Marginal
Marginal
Relom on Total Development Cost
NOI
$ 1,501,956 $
2,259,186
5 2,120,542 $
3,557,092
$ 1,246.145 $
1829,035
Total Development Cost
$ (20,765,962)- $
(31,336,235)
$ (29,444,361) $
(49,696,524)
$ (20,606,477) $
(30,842,884)
Return on Cast
7.23%
7.21%
7.23%
7.16%
5.99%.
6.93%
Return on Cast No Fees
7.33%
Z30%
7.30%
7.22%
604%
5.90%
Change in Return on Cost
_DA0%
-D.09%
-0.07%
-0.06%
-O05%
-0.06%
Feasible? Yea You Yes Ves Marginal Marginal
HR&AAddsms, Inc.
'L Sommer Test Terl & 2 ROCAlth Fescalm mmary
Page of0 7 -24 -2014
Results Summary - Tier 1 & 2 Development Prototypes (With Add'I Fees)
Appeml
Physical Parameters
HR&AAdAv.m, Inc.
Summer Test Tier 182 ROC War fescvVAPm,um
Pogo An 8 7- 242014
Mixed -Use
MixedUse
MixedUSe
Mixed -Use
Mixed-Use
Mixed-Use
Pmlotype Name
Commemial
Commercial
Commercial
Commercial
RetaiOResidenlial
RetaillHesidential
Location
Wish
Wifinire
Dovmteven
Downtown
Within,
6Mshire
LUCEAsm
LUCE Tier
1
2
1
2
1
2
Permit Regnimment
#Panels
3
3
3
3
3
3
Bldg Height (fact)
32
50
32
60
32
50
Stories (#)
2
3
2
4
2
4
Lord &as(SIT
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg. Ama(SF)4
39,000
57,750.
45,111
76,222
40,125
59,521
Floor Area Ratio(FAR)- Gmss Area
1 .73
2.57
2.OD
3.39
1 .78
265
Floor Area Bal,.(FAR) -Net Area
1.50
2.25
1 .74
2.99
1.50
225
Net Leasable Areas( SF)
33,750
50,625
39,250
67,250
33,750
5D,625
Resldeniiair
-
-
-
-
29,350
46,225
Retail
20,800
20,800
18,00D
18,000
4,400
4,400
Olf¢e
12,950
29,825
21,250
49,250
-
-
Holel
-
-
-
-
-
# Hotel Rcoms
-
-
-
-
-
-
ResidentialUnitMix
Market Rate
Studio
-
-
-
-
475
475
i- BR (SF)
-
-
-
-
700
700
2- BR(SF)
-
-
-
-
1,000
1,000
Studio
-
-
-
-
13
20
i -BR de units)
-
-
-
-
13
20
2- BR (#unus)
-
12
19
Subtotal (# units)
-
-
-
-
38
59
Affordable°
1- BR(SF)
-
-
-
-
600
600
2- BR(SF)
-
-
-
-
I.=
1,000
1 -BR( #units)
-
-
-
-
1
2
2 D Rings)
-
-
1
3
Subtotal ( #units)
-
-
-
-
2
5
Total Units
-
-
-
-
40
64
Parking
Residential
Markel Rate(wtd. mg. per unit)4
-
-
-
-
1.49
1.49
Affordable(avg. permit)
-
-
-
-
1.00
1.00
Subtotal Spaces (#)
-
-
-
-
59
93
Retail
-
-
-
-
2
5
Spaces11,000 SF
3.3
3.3
33
3.3
3.3
3.3
Subtotal Spaces ( #)
69
69
59
59
15
15
Office
Spacesll,000 SF
13
3.3
3.3
3.3
3.3
3.3
Subtotal Spaces M)
43
98
70
163
-
-
Total Spaces
Number
112
167
129
222
74
108
Gross AfealBpace(SF)Surface
300
300
300
300
3DD
300
Gross Aresepace(SF)Subl.
350
350
350
350
350
350
Total Parking Am. (SF)
39,200
58,450
45,150
77,700
25,900
37,800
#surface
-
-
-
-
-
#SnEL Levels Total
17
2.6
2.0
3.5
1.2
1.7
Spaces/Levels 1-2
112
111
129
111
77
112
Spaces/Levels 34
-
56
-
111
(3)
(4)
ConslmcBOn Period (months)
18
18
18
48
18
18
Per guidance provided by City Planning
staff, based on recant development applications; enraging Dovarm. Speed. Plan numeration;
and 2010 LUCE.
a Based on unit ndx and net leasable Boor
area by call type, per City Planning Staff and HRBA.
3 Assumes 6% of Tier 1 and 7odl of Tier
units for 30% income households.
4 Assumes 1.0 sprecalsiudio; LB sp ersll
-BR unit; and 2.0 spacm12 -BR unit
HR&AAdAv.m, Inc.
Summer Test Tier 182 ROC War fescvVAPm,um
Pogo An 8 7- 242014
AppendixA
Physical Parameters (con's)
FIRM Adnsm; Inc.
So.-, Tog Tier 182 ROC NM FeesvllAProgram
Pa9a 3 of 7- 262014
MixedLSe
Mixed -Use
Mixed -Use
Mixed -Use
Mixed -Use
MixedLSe
Prototype Name
Commercial
Comm emiai
Commeroial
Commercial
Reta111Resldentlal
R.W11Resldenddl
Location
Mbire
Wishire
Downtown
Oormlo.
Wlshm,
Wlshnn,
Gross FloorAree by Stow
Site Area
22,500
22,500
22,500
22,500
22,500
22,500
Total Gress Bldg, Area
39,OD0
57,750
45,111
76,222
40,125
59,521
Total Floors
2
3
2
4
2
4
Floor
23,111
23,111
20,ODD
20,000
19,625
19,625
Floor2
14389
16,569
23,611
23,611
19,00D
19,310
Floor
-
16,570
-
21,111
-
9,544
Heard
-
-
-
10,000
-
9,543
Floors
_
_
_
.
Floor 6
Total Gross Floor Area
39,000
57,750
45,111
76,222
40,125
59,521
FAR -Gross Area
1 .73
2.57
2.00
3.39
1 .78
2.65
Net Floor Area W Stow
Floors
20,800
20,800
18,ODD
18.00D
17,220
17,220
Floor
12,950
14,912
21,250
21,250
16,530
16,800
Floor
-
14,913
-
19,0DO
-
8,303
Floor4
-
9,000
8,302
Floor -
-
-
_
_
.
FIO0r6
Total
33,750
50,625
39,250
67,250
33,750
50,625
NellGress Floor Area Overall
88.5%
87 .7%
87.0%
00.2%
90.0%
85.1%
FIRM Adnsm; Inc.
So.-, Tog Tier 182 ROC NM FeesvllAProgram
Pa9a 3 of 7- 262014
Results summary - Tier i & 2 Development Prototypes (With Add 'I Fees)
Appeindix B
Development Costs
Land Crust $ 4,765,180 $ 6.403520 5 10.234955 $ 15,507,946 $ 9,910,684 $ 13,877,599
Hard coat
Caastmrnon Type
Mixewse
I4i.dd4e.
Madolilse
Mixedllse
nvxewae
lgxea Dae
Pmlorype Name
PsuOalmR Commercial
Commercial
Commeralal
Commented
RetaiVResid.,11a1
RelaNResidenllal
LoeaPar
wled.
Wields
D.M.
omvnlmvn
wlanbe
wlsldre
)end No.
22500
22500
22500
22,500
22,500
n,500
Gross Bldg. roaDF)
59,000
57,750
45,111
7$.222
49125
59,521
Net Leasable Areas (SP)
$ t0o0o0
$
to0,000
$109000
.Midi., Coco 85 hell
150%
Residential
$ 6,507,540
-
-
-
29350
46,225
Retail
20,800
2,800
10,0.00
$ 72g0O.
4.400
4.400
GRce
12,950
29,825
21,250
49,250
-
-
Lend
$ 694,750
$ 637.5.
$ 1477.5.
5
-
Hotel Froms
$250.
xR.-
$ -
$ -
$ -
$ -
noreeuanean During (spaces)
112
1.7
120
222
74
105
1-2 Levels
112
111
129
111
77
112
34 Levels
-
Re
-
111
(3)
(4)
Land Crust $ 4,765,180 $ 6.403520 5 10.234955 $ 15,507,946 $ 9,910,684 $ 13,877,599
Hard coat
Caastmrnon Type
18
v
V
V
V
V
V
Oulldin90onstugI5NG5'
6500%
Varies
5157
$181
$177
$190
$116
$131
DemolOm50e lm".'sna is
$IS
per tensile.
$ 337,500
$ 337,500
$ 337.s.
5 337,500
$
33],50)
$ 337,500
OMSAe Improvements
$IDOOOO
Nlarence
$ to0...
$ 100,000
$ to0,000
$ t0o0o0
$
to0,000
$109000
.Midi., Coco 85 hell
150%
Varies
$ 6,507,540
$ W.4619SU
5 7,997,729
$ 14,495,DW
$
4,636.845
$ ].]96,656
Preali Tenant Improvements
$35
xNet Leasable SF
$ 72g0O.
5 728,0.
$ 630,000
$ 630,000
S
159.000
$ 154 000
Office Tenant dr,devemanls
$30
.Net Leasable SF
$ 300,500
$ 694,750
$ 637.5.
$ 1477.5.
5
-
HotelFF &E
$250.
xR.-
$ -
$ -
$ -
$ -
$
-
$ -
..rananeanPadang
S 1,543,636
$ 2.330,448
5 2169791
5
3,694.0
$
1,541
$ 27200,935
Surface
$5,000
per 6pare
S
$
$
$
5
20,806,477
$
1 -2 Levels
$30000
per Space
$ 3,3601000
$ 3,340.000
5 3,670000
$ 3,330,.0
$
2,310,000
$ 3,360,000
34 Lease
$35,000
per Space
$
$ 1948,333
$
$ 3,085,000
$
(105 OW)
$ (140.0.)
Contingency
4%
x Surreal Hard Code
$ 456.682
$ 71 2,423
$ 5429.
$ 970.236
$
297.334
$ 464.320
Sauteed Hard Sees
$ 11,876,402
$ 16,522998
$ 14115631/
$ 26,226,136
$
7.73D,879
$ 12,072,482
Soft Costs
Net ParkeMecreation Fee
Sao A,,D
$ 44,192
$ 87.995
S 59179
$ 132,914
$
177,343
$ 297,162
Net Available housing linkage Fee
See App.D
$ 214.432
$ 405,670
$ 273,559
$ 595,470
$
-
$ -
"at TIP Fee
See A,,.
5 49,315
$ 632,112
$ 347.875
$ 657,499
5
$
Ome, Cle, records Fees
See A,,.
$ 400,940
$ 695275
S 468.303
5 752,486
$
312,702
$ 593,W4
Mise COmmuniM eenefns Sort
Alurvences
$
5
$
$
$
$
ABEONaaPmlesslonals
6%
xHard Costs
5 712,704
$ 1,111,380
$ 846,938
$ L513.588
$
453,841
$ 7-Dun
MaAeOngM1eaSing COnvNSSlons
R- raddea1
SZ50
Net Leasable SF
$
$
5
$
$
220.125
$ 346,888
Retaienfic,
$3.00
xNet Leasable IF
5 101.250
$ 151,875
$ 117,750
$ 201.750
$
13,2.
5 13,2.
Legal Aaountlne
1%
aHard COS.
$ 118,704
$ 165230
$ 141.155
S 252,2771
$
77,301
$ 120,725
Texas &Insumnce
1%
xHaA Costs
$ 118,784
$ 195.230
$ 141,156
$ 252,2(1
$
77.307
$ 120,725
PreApening Expenses
$4.00
xNet Leasable OF
$
5
$
$
$
$
Developer Fee
3%
aFort Corte
$ 350352
5 555,6.
$ 423,469
$ 756,784
$
231.920
$ .2,174
Contingency
3%
x Subtotal Soft Costs
S 75.3
$ N8.814
$ 84582
$ 453.450
$
47,215
5 75041
S.F.WlSOfl Costs
5 2.577,644
$ 4,070,271
$ 2.903.966
$ 5,208,442
5
1.621,040
$ 2603,057
Subtotal Held t SOBS Casts
$ 19.221428
S 29,005,787
$ 27,254,570
$ 46,002,524
# $
19,28293
$ 29553.949
Ffnandng Cases
Loan Tom hurrahs)
18
Average an Balance
6500%
Conslmction Loan raised Rate
6.50%
ConslmdlCn Lean Interest
$ 1,030,149
$ 1,555,435
$ 1,401,526
5
2,465,665
$
1,032,946
$ 1,531,205
Credited.. Loan Fees
150%
$ 2BB,321
$ 435.87
5 406818
$
690,030
$
288,936
$ 420,30D
Capeadued Projed Value
per A, E
Permanent Lean Percent x Value
6500%
Permanent Loan Fees
150%
5 224 See
$ 339,926
S 319446
$
537,077
# 5
222192
$ 329.421
Bublotal Financing Secure
S 1,543,636
$ 2.330,448
5 2169791
5
3,694.0
$
1,541
$ 27200,935
Total Development COS1
Hard r Sorer Freedom,
$ 20,765,062
$ 31.336,235
$ 29,444,361
$
49696,524
# $
20,806,477
$ 30.842,884
per G3F
$ 53244
$ 54262
$ 652.71
$
652 DO
$
P..
5 WAS
' Per HRBAdvc .11 of market data and SaneforolbTry .......cars .1,...fdevetopmems.
s BD %x cM.Wed values, par Ala¢hall & SNBC ander..1 Coal Parental out Ouarlep 2013; HRBA Arrears, be, to acwunt for outaln hard costs and soft costs accounted for separately
H To a""Inc.
mar Test filer l& 2 ROC win Feae,111.e rose
Pa 9e of8 sum _ 7- 29]014
Results Summary -Tier 1 & 2 Development Prototypes nth Add'1 Fees)
Appendix
Proposed New Fees, Existing City Fees & Permit Costs
' See Appendw O far calmla4m del.Ils.
Per new Ordnance No. 2420 (CGS), adopted March 12, 2013. Assumes TIF welt for exlsSnO men on 50% of rile area,
s Per Cilyde314Cit sfdymc mentla5ons. Assumes fee cacti°far exlsgn9 retail on 50 %o(stlearea.
' Per do.." -14 City fee schedules.
Indutles meter and capital ladlNes char0es.
Hi Adwas, Inc.
2 so-or last Ter l e a ROC Cho Fcosv l lCC Cost Potosi Pe 9e o18 7 ..11
Mixed Us.
Mixed-0se
Mbaeduso
diool Us.
Mixed us.
MirebUSe
Prototype Name
Ass minions
Commercial
Curnorefflid
Commercial
Commercial
Retai6Residential
ROWIR Wartfai
L ... Us.
Nhlshim
WI'h9e
Oovmlevm
Dmmlmm
Won'.
Wish[.
Land Nee
22,500
22,500
22,500
22,500
22,500
22,500
Gross Bldg. Area (6F)
39,000
5],]50
45,111
76,222
40,125
59,521
foodmi Who
Market Rate
SNdos
-
-
-
-
13
20
1 -6R
-
-
13
20
2 B
12
19
motors.
1 -8R
-
-
-
-
1
2
2 E
-
-
-
-
1
3
Rosidendal(Net Leasable SF)
29,350
46,225
Recall Spur Leasable SF)
20,000
20,000
18,000
18,000
4,400
4,400
On. (Net Leasable SF)
12,050
29,825
21,250
49,250
-
-
Hotel(NetLeasableSF)
-
-
-
_
.
New Affordable Hsg. Linkage Fee
NIA
WA
$ 214A32
$ 405,"0
$ 273,558
$ 595,470
$ -
$ -
New ParksFee,
WA
WA
$ 44,192
$ 87,995
$ 59,179
$ 132,914
$ 1]],343
$ 297,162
TIF Forma
$ 427,315
$ 632,112
$ 34],8]5
$ 657,499
S -
$ -
Planning Porous'
Development Review
$15,560
perpmjed
$ -
$ -
$ -
$ -
$ -
$
Development Agreement
$25,000
perpraject
§
$
$
$
$
$
Multiple Permit Fee
$1,684
perpraject
$ 1,544
$ 1,604
$ 1,684
$ 1,684
$ 1.684
$ 1,544
AchiNCMal Review Board
$1,604
perpmject
$
$ 1,684
$ 1,684
$ 1,684
S 1,684
ri
Coaslai Zone Concept ReVW
$276
perpraject
$ 276
$ 276
$ 275
$ -
$ -
$ 276
CEOA
Categorical 6anadiSe
$14.622
perpraject
$ 14,622
$ 14,622
$ 14,622
$ 14,622
$ 14,622
$ 14,622
Ne0ests Badaradon
$25,445
perpraect
$ -
$ -
$ -
$ -
$ -
$ -
EIR
$200,000
perpraject
$
$
$
$
$
$
Subtotal
§ 16,442
$ 18,266
$ 181260
$ 17.990
$ 17.990
§ 10,442
Other Requirements'
h1Nga0on Fee an Office Space
$10.80
xleasable area >15K
$ -
is -
$ -
$ -
$ -
$
Recreational Unit Tax
$200
xunits
$ -
$ -
$ -
$ -
$ .-
$ 12,800
Ah Fee
New RissidenllaGoormerdal
I.00b
x $2001SF
$ 70,000
$ 115,500
$ 90,222
$ 152,444
is 00,250
$ 119,042
Tenant lmpmvemenie
0.01
x$50SF
$ 16,875
$ 25,313
is 19,625
$ 33,625
$ 2.200
$ 2,200
Child Care Fee
Markel Rate Resident's]
$133.40
permit
$
$
$
$
$ 5,072
$ 7,875
Retail
$4.53
xleasable area
$ 94,224
$ 94,224
$ 01,540
$ 61,540
$ 19,932
$ 19,932
01fice
$6.34
xleasable area
$ 82,103
$ 109,091
is 134,725
$ 312,245
$ -
$ -
Hciel
3.18
xleasable are.
$ -
$ -
$ -
$ -
$ -
$ -
School Families Fee
Residen0al
$3.20
x leasable .,.a
$
$
$
$
$ 93,920
$ 147,920
Serum erti,]
0.51
or leasable area
$ 17.213
$ 25,819
S 20,018
S 34,298
$ 2,244
$ 2,244
Subtotal
$ 280,415
$ 449,947
$ 346,130
$ 614,152
$ 2031619
$ 312,013
BIdgJComatmdion Pumps'
Plan Cheek
Antimm rm
$09127
xleasable area
$
$
$
$
$
$ 42,190
Commercial 10K SF
$1.2790
xleasable mea
$26,603
$26603
$23,022
$12,790
$5,628
$5,628
Commercial >10K SF/4 stories
$13621
xleasable area
$
$14,711
$
$
$
$
Mechanical
$727
per project
$727
$727
$727
$727
$727
$727
Elecbical
$727
perPmled
$727
$]2]
$]2]
$727
$727
$727
Plumbing
$]2]
perpmject
$]2]
$727
$727
$]2]
$727
$727
Building Permileftemouans
Apartments
$1.0238
xleasable area
$
$
$
$
$
$ 47,316
Germicidal l -Story
$0.]]62
xleasable area
$ 16,167
$ 16,187
$ 14,008
$ 14,008
$ 3,424
$ 3,424 09
Commeldel 4e stores
$1.3581
xleasable area
$
$ 40,505
rt
$
$
$
Tenant lmpmeourn as<10K SF
$0.3490
xleasable ama
$ 7,259
$ 7,259
$ 6,282
$ 3,490
$ 1.636
$ 1,536
Tenant Improvements >10K SF
$02732
xleasable area
$ 3,538
$ 8,140
$ 5,806
$ 13.455
$ -
$ -
GeelechumalReports
$2.401
per project
$
$
$
$
$
$
Subtotal
$ 59,768
$ 115,504
$ 61.299
$ 45,924
$ 12,769
$ 102,275
Utility Fare
Wale, Meters
$3,837
314' star per stoical
$ 3,837
$ 3,837
$ 3,837
$ 3,037
$ 3,837
$ 3,837
Routine Meters
$10,195
4- meter per project
$ 18,195
$ 10,195
$ 18,195
$ 18,195
$ 18,195
$ 18,195
Wastewater Sr ital Fadltles
SNdich -BR Unds
$1.168
per aril
$ -
$ -
$ -
$ -
S 32,704
$ 52,560
2 -BR Urft
$1,557
per unit
$
$
$
$
$ 20.241
$ 34,254
Commercial
$779
per 1p001easable SF
$ 26,291
$ 39.437
$ 30,576
S 52,308
$ 3.428
$ 3,428
Subtotal
$ 48,323
$ 61,469
$ $2,605
$ 74,420
$ 78,405
$ 112,274
per GSF
$3.53#
$3.83
$3.15
$226
$2,78
$192
' See Appendw O far calmla4m del.Ils.
Per new Ordnance No. 2420 (CGS), adopted March 12, 2013. Assumes TIF welt for exlsSnO men on 50% of rile area,
s Per Cilyde314Cit sfdymc mentla5ons. Assumes fee cacti°far exlsgn9 retail on 50 %o(stlearea.
' Per do.." -14 City fee schedules.
Indutles meter and capital ladlNes char0es.
Hi Adwas, Inc.
2 so-or last Ter l e a ROC Cho Fcosv l lCC Cost Potosi Pe 9e o18 7 ..11
Appendix D
Proposed TIF /New ParkslRecieation and Aflorable, Housing Linkage Fees
Proposed Parks /Recreation Fee
25%x Maximum Fees
Assumotlons
Mixed Use
Mixed -Use
Mixed -Use
Mixed Use
MisombUs.
Mixed.Use
Prototype Name
25%
Commercial
Commercial
Commereial
Commercial
RelailaResidential
RatellResidenlial
Leeman
25%
$16,554 per unit
Pdlshire
Welkin,
Dm.uses
0 ... at .
Widere
VBisbim
WCETier
25%
$20,861 per unit
1
2
1
2
1
2
Land Am.
54 perun8
22,500
22,500
22,500
22,500
22,500
22,500
Glass Bid, Are. (CF)
25%
$5.98 xieaaablearea
39,000
5],]50
45,114
76,222
40125
59,521
Resklential Ures
25%
$9.24 xleasable area
-
-
-
-
40
64
Market Re[.
25%
$12.52 xleasable area
$
$
S
$
$
5
Studios
-
-
-
-
13
20
I -BR
-
-
-
-
13
20
2 -BR
25%
$5.98 xleasable area
-
-
-
-
12
19
Atanduble
25%
$024 x lea sable area
$
$
$
$
$
$
I BR
-
-
-
-
1
2
2 B
-
-
-
-
1
3
Residential (Net Leasable SF)
-
-
-
-
29,350
46,225
Retell (Net Leasable SF)
Assumotlons
20,800
20,900
10,000
10,000
4,400
4,400
Once Mel Leasable SF)
$195.07 xieaaablearea
$ 102,586
12,950
29,825
21,250
49,250
-
-
Hotel (NetLeaseble SF)
$224.11 xPasableams
$ 130,603
-
-
-
-
-
-
Hoor Area AlNbulable 10 ¶er g
$ 313,186
$ 504,424
$ 372,312
$ 694,224
$ 30,624
$ 38,624
Less: Fee on Existing Retell SF
OR.
-
14,912
-
28,000
-
Rates
Residenlial
$195.07 x leasable area
$ (98,754)
-
-
-
-
-
16,605
Total Units
$224.11 x leasable area
$
-
-
-
-
-
24
Market Rate Units
$ 214,432
-
-
-
-
-
22
Studies
$ 666,939
$ 1,tg19.49
$ 680,612
$ 9x3618.18
$ 1]],343
$ ; 9],199
a
i -BR
$
$ 19.49
$ 15,09
5 18.18
$ 4.42
$ 4.99
2
2 -BR
4,459
$ 20,d]43.4
$ 30,847,408
$ 28,101,273
$ 48,990.6
S 20,504,722
$ 39,d861.0
]
Agmdable Runs
3.4%
3.6%
2.3%
2.6%
0.9%
LO%
2
i -SR
1
2 -BR
1
Assumed Lose, Retail (50% .,to area)
11,250
11,250
11,250
11,250
11.250
11,25D
Fee Factor
', 114{
j1.14
1.14
.. 31s,
TIF Fees'
Market Rate -Areal
$2,600
per unit
$ -
$ - $
-
$ -
$ -
It -
Market Rate -Area 2
$3,300
per unit
$ -
$ - $
-
$ -
$ 125,400
$ 208,691
Affordable
$0.00
per unit
$ -
$ - $
-
$ -
$ -
It -
Retail -Area 1
$21.00
.leasable area
$ -
$ - $
378,000
$ 328,000
$ -
$ -
Retail -Area 2
$30.10
.leasable area
$ 626,080
$ 628,000 $
-
$ -
$ 132,440
$ 132,440
Office Areal
$9.20
.leasable area
$ -
$ - $
20.125
$ 515,749
$ -
$ -
Olfice -fines 2
$10.80
.leasable area
$ 139,880
$ 344,857
$ -
$ -
PotehArea l& 2
$3.60
xleasable area
$
$ S
$
$
5
Subtotal
$ 765,940
$ 920,]3] $
584,125
$ 893,749
$ 257,840
$ 341,131
Less: Fee on 50% Existing Retail SF Area 1
$21.00
.leasable area
$
(236,250)
$ (238,250)
Less: Fee on 50% Existing Bull SF Area 2
$30.10
xleasable area
$ (338,625)
$ (338,625) $
$
$ (336,625)
$ (338625)
NET TIF Fee
$ 427,316
It 632,112 $
34],8]6
$ 657,499
$
$
Proposed Parks /Recreation Fee
25%x Maximum Fees
HRBA AMI e" Inc.
Summer Testnwrl &2RGCWth Fe 14LFee Analysis
page of8 7- 243014
Assumotlons
Model Rate Housing
25%
0 -1 BRS
25%
$16,554 per unit
$ -
$ -
$ -
$ -
$ 107,601
$ 174,231
21 BRS
25%
$20,861 per unit
$ -
$ -
$ -
$ -
$ 79,983
5 133,172
AOmdeble Housing
54 perun8
$
$
$
$
$ -
$ -
Relml
25%
$5.98 xieaaablearea
$ 31,096
$ 31,096
$ 26,910
$ 26,910
is 6,578
$ 6,578
On's
25%
$9.24 xleasable area
$ 29,915
$ 23,]18
$ 49,088
$ 122,823
$ -
$ -
Holel
25%
$12.52 xleasable area
$
$
S
$
$
5
Subislai Fee
$ 61,011
$ 104,814
$ 75,998
$ 149,233
$ 194,162
$ 313,981
Less: Fee on LAW, Retail SF
Retail
25%
$5.98 xleasable area
$ (16,819)
$ (161619)
$ (16,819)
$ (16,819)
$ (10819)
5 (10,819)
Ofiee
25%
$024 x lea sable area
$
$
$
$
$
$
Net Fee
$ 44.192
$ 87995
S 59179
$ 132,914
$ 171,343
$ 297162
Proposed Affordable Housing Linkage Fee
4.5 %'hux]mum Fees
4.5%
Assumotlons
Retail
4,5%
$195.07 xieaaablearea
$ 102,586
$ 182,506
$ 150007
$ 158,007
$ 38624
$ 38,624
On.
45%
$224.11 xPasableams
$ 130,603
$ 321,038
$ 214,305
$ 536,217
$
$ -
SaMelaiFee
$ 313,186
$ 504,424
$ 372,312
$ 694,224
$ 30,624
$ 38,624
Less: Fee on Existing Retell SF
Rates
4.5%
$195.07 x leasable area
$ (98,754)
$ (96,7541
$ (98,754)
$ (98,754)
$ (90]54)
$ (98,754)
ORCe
4.5%
$224.11 x leasable area
$
$
$
$
$
$
Net Fee
$ 214,432
$ 405670
$ 273556
$ 595470
S
$
Combined Nmv Fees Will TierR Bump
$ 666,939
$ 1,tg19.49
$ 680,612
$ 9x3618.18
$ 1]],343
$ ; 9],199
Fees Per OSF
$
$ 19.49
$ 15,09
5 18.18
$ 4.42
$ 4.99
Total Development GOSt
4,459
$ 20,d]43.4
$ 30,847,408
$ 28,101,273
$ 48,990.6
S 20,504,722
$ 39,d861.0
Fee as %Oev Cost
3.4%
3.6%
2.3%
2.6%
0.9%
LO%
HRBA AMI e" Inc.
Summer Testnwrl &2RGCWth Fe 14LFee Analysis
page of8 7- 243014
Results Summary - Tier 1 & 2 Development Prototypes (With Add1 Fees)
Apparel. E
Net Operating Incame
Pmlotype Name
Location
Land Area
Gross bank. Area (6F)
ResldenOal Units
Mortal Rate
Studio
L-BR
2 B
Affo t able
L -BR
2 SR
Head (Net Leasable SF)
Office (Net Leasable SF)
Hotel (Not Leasable St)
Parking Spaces
Residential
Retail
Off"
Hotel
Mixed Us. Mixed -Use
Assumptions Commercial Commercial
Wishim Within,
22,500 22,500
39,000 5],]50
For -Rent Residential- Market Rate
69
Studio Re0lkhrit Onll1
59
1 B Ren UabMOnth
$3,800
2 B Renaln Anoth
98
Units lncomeNs.,
163
Mer Incame
5.0%
Gross Income
$0
Less: Vacancy &Collecion Loss
50%
Effective Gross income (EGI)
$2,945
Less: Canning Expenses (red. reserve)
$ 7,000
Net Operating Income
$3,890
For -Rent Residentiai- Affordable (30 %income(
$4,999
1 -BR Reat UnIVMOnth
$
2 -BR RBOlrllre Month
$
Units muarra r
$
Other income
1.0%
Gross income,
$
Less: Vacancy &Collection Loss
5.0%
Effective Gross Income (EGI)
$
Less: Operating Expenses gee. reserve)
$ 1,000
Net Operaling Income
Rend
Average RentartWonth (NNN)
Gues Rental lncoors"o.r
Less: Vacancy &Collection Loss
Egaclies Gm55 Income (EGI)
Less: Unreimbwsed Cancer, Expenses
No[ Operating Income,
Office,
Average ROTSFrlrbnlh(NNN)
Curse Rental lncema Year
Parking incomd
Less: Vacancy & Collection Lou
Elfedive Gross Income (EGI)
Less: UNelmbmsed Operating Expenses
Less: Parking Expense
Net O onalin0 income
Total Net Operating Income
20,000 20,800
12,950 29,825
112 16]
Mlxod -Use
Commercial
Ootvnlmvn
n,500
45,111
18,000
21,250
129
Mixed -Use
Commercial
D vent..
22,500
]6,222
18,000
49,250
222
Mixed Use
Reefiffeeslde0tlal
Wlshire
22,509
40,125
40
30
13
13
12
2
1
1
4,400
]4
59
15
Mixed -Use
Retaifflesidenlial
WlShirs
22,596
59,521
64
59
20
20
19
5
2
3
4,400
100
93
15
$2,043
69
69
59
59
$3,800
43
98
70
163
Vanes
$0
$0
$0
$0
Vanes
$2,945
$2,945
$3,100
$3,100
Vanes
$3,890
$3,090
$4,999
$4,000
$
5
$
3.0% xpar
$
x Units income
$
$
$
$
x Grass Income
$
$
$
$
xGress income
$
$
It
$
- $
$
$
$
$
xEGI
$
$
$
$
$ (35000)
5
$
S
$
Mixed Use
Reefiffeeslde0tlal
Wlshire
22,509
40,125
40
30
13
13
12
2
1
1
4,400
]4
59
15
Mixed -Use
Retaifflesidenlial
WlShirs
22,596
59,521
64
59
20
20
19
5
2
3
4,400
100
93
15
$2,043
$2,043
$2,945
$2,945
$3,800
$3,800
$ 1,325,328 $
2.063 520
$ 66,266 $
103176
S 1,391,594 $
2,166,896
$ (69,580 $
(108.335)
$ 1,322,014 $
2p58,361
S (266000) $
(413000)
$ 1,056,014 $
1,645,361
Vanes
$ - $
- $
- $
- $
389
$ 389
$ - $
- $
- $
- $
437
$ 437
5.0% xGmse Income
$ $
- $
- $
- $
9,912
$ 25.060
x Units Income
$ $
It
$
$
99
$ 251
3.0% xpar
$ - $
- $
- $
- $
10,011
$ 25,319
x Grass Income
$ $
$
$
$
(5011
$ (1,266)
xParkin0 income
$ - $
- $
- $
- $
9,510
$ 24,053
x EGI
$ $
$
$
$
(14,000)
$ (35000)
$ - $
- S
- $
- 5
(4,490)
$ (1D,947)
Vanes
$ 4.OD
$ 4.00
$ 5.25
$ 525
$ 4.00
$ 4.00
$ 998,400
$ 998,40D
$ 1,134,000
$ 1,134,000
$ 211,200
$ 211,200
5.0% xGmse Income
$ (49,9201
$ (49,920)
$ 158700)
$ (56700)
$ (10560
$ (10,560)
.Gross Income
$ 948,480
$ 948,480
$ 10]],300
$ 1,0]],300
$ 200,64
$ 200,540
3.0% xpar
$ (28.454)
$ (28454)
$ (32319)
$ (32,319)
$ (6019)
$ (6019)
xEGI
$ 920,026
$ 920,026
$ 1,044,881
$ 1,044.981
5 194,621
$ 194,621
r Per HRBA review of market data and finanola feasibility peer earns obmcenl dovelopments, Assumes W (shim resMeniid rents = 95 %xdmashern.
' Per CiIVs rent schedule and HRSA a.ssumpfiees.
s Assumes $200rmonth mserved (10% absently); $1651monlb unreserved (85 %); and $500rmenih daily use (5 %).
HRSAAdvisor; Irm_
puer_Ted Ler t &2 ROC Wih FeesVt@ -Not Ops lowers
Pa ,a o18 mm 7- 241014
$ 3.75
$ 3.75
$ 4.30
$ 4.30
$ - 5 -
$ 582,750
$ 1,342,125
$ 1,096,500
$ 2,541,300
5 - $ -
$2,223Wd.Aer.lSpaceNr.
$ 95,589
$ 217,854
$ 155,610
$ 362,349
5 - $ -
5A%
.Gross Income
$ (28138)
$ (67.106
$ (54,825
$ L27,06
5 $
$ 649,201
$ 1,492,873
$ 1,197,285
$ 2,]]6,584
$ - $ -
3.0%
xEGI
$ (19,476)
$ (44,786)
$ (35,919)
$ (83,290)
5 - 5 -
50.0 °A
xParkin0 income
$ (4],]95)
$ (108,92'p
$ (77 ,805
$ (181,17
5 5
$ 581,930
$ 1,339,160
$ 1,083,561
$ 2,512,111
$ - $ -
$ 1,601,950
$ 2,259,186
$ 2,128,542
$ 3,557,092
$ 1,246,145 $ 1,829,035
r Per HRBA review of market data and finanola feasibility peer earns obmcenl dovelopments, Assumes W (shim resMeniid rents = 95 %xdmashern.
' Per CiIVs rent schedule and HRSA a.ssumpfiees.
s Assumes $200rmonth mserved (10% absently); $1651monlb unreserved (85 %); and $500rmenih daily use (5 %).
HRSAAdvisor; Irm_
puer_Ted Ler t &2 ROC Wih FeesVt@ -Not Ops lowers
Pa ,a o18 mm 7- 241014
Results Summary - Tier 1 & 2 Development Prototypes (With Add9 Fees)
Appendix F
Return on Cost/0eveloper ProiRt Margin
HR&A AtlWSOrs, Ina
Suer_Test Ter t & 2 ROC W Retom Jb Fecoyifi on Cos
Page o(8 mm 7 -24 -2014
Mixed Use
Mixed -Use
Mixed -Ups
Mixed -Use
Mix abuse
Mixed Use
Prototype Name
Assumptions
Commercial
Commercial
Commercial
Commercial
RelelVeesldeptiai RetaillResidenllal
Location
Wlshire
Wlshim
Devout..
Downtown
within,
Wlshire
Land Area
22,500
22,500
22,500
22,500
22,500
22,500
Gross Pon. Area (89
39,000
57,750
45,111
76,222
40,125
59,521
Residential Units
Market Rate
Studio
-
-
-
-
475
475
1 B
-
-
-
-
13
20
2 B
-
-
-
-
12
19
Affordable
I -BR
1
2
2 -BR
-
-
-
1
3
Retail (Net Leasable SF)
20,600
20,800
1$000
18,000
4,400
4,400
0t8ce(NeLLartud a SF)
12,850
29,825
21,250
49,250
-
-
Project Value
Resldan9al-Market Rate
Net Operating income
From App,E $
- 5
-
$ -
$ -
$ 1,050,014 5
1645,361
Cap Rate
AxURS
Value
NOVCap Rate $
- $
-
$ -
5
$ 19,924,792 $
31,044,547
Ressmobal-A((oNable
Net OpemOng Income
From App,E $
- $
-
5 -
$ -
5 (4,490) $
(10,947)
Cap Rater
5.30%
Value
NOIICap Rate $
- $
-
$ -
$ -
$ (84,717) $
(200,547)
Recall
Net Operating Income
From App,E $
920,026 $
920,028
$ 1,044,981
$ 1,044,981
$ 194,621 $
194,621
Cap Rale1
6.60%
Value
NOVCap Rate $
13,939,788 $
13,939,768
$ 15,833,045
5 15.833.045
$ 2,940,803 $
2,940,803
Oft.
Net Operating Income
From App,E $
581,930 $
1,339,160
$ 1883,581
$ 2,512,111
$ - $
-
Cap Rate
BAD%
Value
NOVCap Rate $
9,092,658 $
20,924,375
$ 16,930841
$ 39,251,734
$ - 5
-
Hotel
Net Operating Income
$
- 5
-
$ -
$ -
$
Cap Rate'
Value
$
- 5
$ -
$ -
$ - $
-
Total Project Value
$
23,032,444 S
34,664,163
$ 32,763,686
$ 55,004,779
S 22,788,870 $
33,786,003
Developer Returns
Developer Profit
Total Project Value
From.hOVe $
23,032,444 5
34,864,163
$ 32,763,666
$ 55.084,779
$ 22,788,870 $
33,706,803
Less : Total Development Cost
From AN,B $
(20786,002) $
(31336235)
5 (29444361)
$ (49698524)
$ (2080647]1 $
(30842884)
Profit
$
2,267,382 $
3,527,928
$ 3,319,325
$ 5,388,255
$ 1,902,401 $
2,943,919
al, of Value
9.8%
10.1%
10.1%
9.6%
6.7%
6]1k
Relam on Total Development Cost
ND1
From App.E $
1.501,056 $
2,259,186
$ 2,128,542
$ 3,557,092
$ 1,240,145 $
1,029,035
Total Development Cast
From App.B $
(20,765,062) $
(31,336,235)
$ (29,444,381)
$ (49,696,524)
$ (20,808,47T) $
(30842,884)
Rule. oa 0.1
1.23%
7.21%
7.23%
Td6%
5.99%
5.93%
r Per Real Estate Research Cory.,
Real Estate Repo rk 3rd 0uadet2013, LOS
Angeles Area data.
HR&A AtlWSOrs, Ina
Suer_Test Ter t & 2 ROC W Retom Jb Fecoyifi on Cos
Page o(8 mm 7 -24 -2014
ATTACHMENT 8
Analysis results for 8 new mixed -use prototypes:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
30
Residual Land Valud
Results Summary - Tie] 14 2 Development Prototype$ (L4filll Add'1 Fees)
Pre Olam Summary (see App. A)
evelopment tests (see App, ms, ... )
sns,nLse
Pne.e.se
I,IIVebUxe
1.Rue.so
I.RdIs.
sneedDee
Rk..so
RldedUse
prototype Name
Rstalnftstl -"M
..Nsn eSldsmisl
ReWIIR- identlsl
RetalllResld -ftl
R.sennsilds.el
Relall.R Imentlal
Rela lURe51 tlen0ai
ps.n ResRRmD1
Isovs-
Piw Wmi
Piw
fi1.1 RI W.
BI,161vE.
So..-I, E3..
So tinvvin Blvtl.
C6o,.-
Re..Oxn
WGE rtes
1
2
I
2
1
2
1
2
Pemil Requirement
5
ee21,.4
$ 6,980.118
$ loss".
$
1],.1]90
SoRCOs.
Ne{pnkslRes -ROn Fee
'3
9 Parwls
61tl9 Hei9Ft(")
36
36
36
96
36
6
33
39
60
6W-D)
2
3
2
3
2
3
B
6Pe No.(BF)
15,0.
15.WJ
Itt.
15,.3
15,.3
lo'.
15,"
IS,WJ
Omss01d9, N0a(SF)
2].24]
3165]
2].24]
29,9]3
2].24]
35669
40,160
61.11]
Flom moo R..(EAR) -Gross Area
182
210
iB2
2.
182
239
2.
407
FIO6r NOa no. (FAR) -I4e1 Nea
150
1.15
1.60
168
IW
206
2.
346
Net LI- RIArees
$ 361(6]
$
594..2
Otlwr Om CO Sts
S
]04..2
$
Wsess
RedEenlsl(SF)
19,SW
23260
19503
2".1
111,5.
22(sI
29,]50
48,OPo
Mallet R.I. Un'N
YJ
27
23
24
ve
31
35
SS
Asso, 10 11nils
1
2
1
2
1
3
2
5
1e.1 Un'N
24
20
N
26
21
34
97
61
geGll(SF)
3,003
30.
3,OW
3.855
3,000
3,M0
9..0
4..v]
evelopment tests (see App, ms, ... )
Land Costa
see Resltlual
Valua
see RasiEUel Ve We
sae
Re vEUal Value
see Resitlnal Value
xeo
Resitl ual Valua
sea Rastlual Value
ue Resltlual Vxloa
see
Resltlual Value
H ertl Ga sls
$
0,421664
S
82]6.091
$
S,d21,864
5
599].183
5
ee21,.4
$ 6,980.118
$ loss".
$
1],.1]90
SoRCOs.
Ne{pnkslRes -ROn Fee
'3
100145
E
146.624
5
106,14S
f
112.141
$
106.14$
1 190'23]
1 1]4,6]4
$
$el.H4
He1AHortlable H.mmR LIn Ra90 FCe
f
1
-
$
-
E
$
3 -
1 -
$
-
tlFFee
$
E
5
3
E
1
3 ""Its
$
]9,]94
Otlesr II" C.. too. App E)
$
253.908
$
309,479
$
253.908
$
301..4
$
25].906
S 339124
$ 361(6]
$
594..2
Otlwr Om CO Sts
S
]04..2
$
Wsess
E
]04,9]2
S
066,379
$
]84.9]2
$ 1025983
5 1,149BP
$
1339842
'Moo.9COs.
5
596720
5
033.]60
S
563945
$
617.]]0
5
553107
$ ]18.526
$ 008.126
S
1.13e 1.
Total Oevefopme nl COS1
S
7,112969
$
8,229,810
$
7.135214
S
7.094,092
$
7.11%.
$ 8281.591
$ IO,d55,P0
E
2?093,114
•GSF
E261
5261
$262
$283
Sem
W.
$260
5361
Net Operalln9 Income (NOR (see App E)
ResldenSaH,larket Rafe
ERsc.e C toss In-..
$
026,925
$
74].37]
$
712,215
$
712215
$
630,825
S 099,721
$ 13288]0
$
?055,041
Low OPetaOy Expenses
E
(Ill.
5
1090.)
$
(161 W01
$
161 W])
S
(1810.1
$ (217.)
$ t252 1
4
pl. 0.1
NelOptatng In-
$
48]425
$
6503]]
$
551,215
$
551115
E
951.925
S 032.721
$ 10]66]0
E
1.663.04]
Resitle.. me. ln.,
$
4,479
S
8510
S
4,418
$
9,510
S
9,.9
$ 13,99]
$ 9,510
S
29p53
Less:lost,yExponsea
I-., of
1
7138
$
144.)
$
(]NO
S
II
5
(]WO
21.3
$ 21 d..0)
$
Ns Opxmtin9lnwma
$
R521j
$
(4490)
$
(2621)
$
.A.)
(4.493)
S
(2521)
$ 1]010)
$
$ (4.490)
5
110.04])
lnwma
E
730]2
$
]3.0]2
S
S"ID
$
1R.930
$
119]Po
E 11,
E 2V.,.
2]9.9.
Is- pOroes
Expenses
5
2216
$
122101
$
30931
$
3710
5
135911
pRl
E 35911
$ (]1821
$
$
1].182)
Net Operating lnwma
.It(:Opa'..
E
71656
$
71,168
$
93551
$
120.212
5
118,1.
E 116,109
$ 23?2I6
$
2J?210
Olfiw
ERaMOOrov l
$
-
$
-
$
-
-
E
-
6rO Expo uses
Less: em .,o
Op
$
5
S
$
$
$
$
$
$
Nol Opo mdq lnwme
$
-
1
-
E
$
-
$
$
$
9 -
$
-
Total Net O,ten I
S
538560
S
625543
$
692295
$
6688$]
E
581013
$ 7410.
$ 1304390
S
1685110
Projeot Camp ment Values(sm App F)
Resitle ndal ID1.1 Rale
Not
$
46]425
E
550X7
5
.1115
$
651,215
$
4(57.925
$ 632721
$ I.MAI0
$
1.6.,097
Cap R.I.
v.3%
53%
5.3%
53%
66%
5.3%
v.3%
5.3%
V.1-
5
Rlm. 10
$
10535415
$
10,400.263
$
104.283
$
8,018.340
$ 11..3132
$ 29319,528
$
31]93,390
Rasidentia$ARmtlffile
NOI
E
12,.1)
$
(9.990)
$
(25211
$
(9.4.)
$
12521)
$ (}010)
$ (4,990)
$
RUG)
Cep Reb
v.30%
530%
5.305
R..
5.30%
II..
v.30%
630%
Value
$
(,1].566)
$
(04,]1])
E
(47.566)
$
(84,717)
$
(47,566)
$ (132.264)
$ 181.]1]1
$
Rl6.54])
R.,m
NOI
$
71656
S
71.658
$
9301
3
120,212
$
110109
$ 116,109
$ 232216
S
232219
Cap Rate
660%
3.%
0(mM
660%
6..°b
6W%
660%
It.%
Value
$
I.OMA ]
$
1,08507
$
1.417.439
$
1621394
E
1759,227
$ 1.75%.7
$ ems,,455
$
3.510455
Offiw
Nol
S
-
5
-
E
-
$
-
E
-
E -
5 -
S
-
UpRa.
640%
6.90%
840%
640%
340%
640%
340%
04034
Velua
S
-
$
-
$
-
S
-
5
5 -
$ -
$
-
$
905]4]1
S
11536395
$
11770166
5
12136860
S
10531001
$ 13565.5
$ 237,18206
S
34]0524]
Resltlual Lantl Value ES6malo
Todl PreDt Valuo
$
9,657,471
$
11535395
S
11,]]0.156
$
121. .
5
10531..1
5 13.585.95
$ 23,]40266
$
39.7..29]
Le ss'. OOVabpar profit
5
112]2189)
$
(1442049)
$
(1.971,270)
S
11,517,1201
$
H 3163]5)
$ (1.695637)
$ (2900.533)
$
(4,338,156)
Le ss:..,.,s.pmanl Cost
5
1].112 H091
$
62299181
5
7135214
S
170946921
$
7119556
$ (9281.91)
$ (104557]01
S
220]31143
Residual Lantl Valoa
Todl
5
1.512,298
$
1664.426
$
3163,622
$
2,724,946
$
2,095.010
$ 2,.7,067
$ 10,32].963
S
0.2]3.0]7
Per SF Lantl Nea
$
101
$
124
5
211
$
182
$
1qO
S 1]d
E 608
$
552
Resitlnal Ls. Value No Feos
51,6.,139
$2,020217
$31]1,513
$2039,169
$2,202.911
Vts.17B
$10,522,754
$0.7]0677
than io Residual Lantl Value
S
(1m..R)
$
(161]90)
$
{107.011)
$
(114221)
E
110],841)
5 (108,310)
$ (198.]91)
$
{om.699)
por 6F Lantl Area
$
9.19)
$
(1078)
E
(].19)
$
1].61)
$
RAIR
$ (1322)
$ (13.)
$
I..)
vs-m ml,,. In Residual L. Value
d]%
-6.0 °n'
13%
i6%
d.9%
1".
.1 %,
57%
WNNIn 11elset R-Ijet
Yes
Yes
Yes
Is
Yea
Yes
Yos
Yes
31 sammer_1:ex T.- 1n2 R1v. Iss.I.-ot
Paae 1 nR 72414
RLV Resu16 Summary -TiuL 182 Develapmenl PLO101ypns HWIM1 Atl81 Fees)
Appendix
Pirysiml Panmefem
dlxebUse "Iced". LllxebUSO Mixed Use esnetl -Ilse M1llxebUse
Pmlelype Noma Reelind- lendfal R,NIMReslEenpal RoIaIIIRese-R.1 RetedIResltlenpal UetxddRxxeotial RetaNResl[enYsl
..eon Pico W. Pim fib1 Me'. xII BNE. So. U—In.. 3, Linoola 6lvtl.
LuCE aea
LUCE Tes I 2 1 2 1 2
Posen Requimmenl
Y Pamis
MN.UUSe Ixedles
Re.HeResltlenpal Rsheneeellentlal
oo-1— mmmnal
1 2
OIEg. HeIHbl dreel)
3p
36
3p
36
36
30
39
60
6lones(i)
2
3
2
x
2
3
3
is
Lantl Naa(6F)
1A.
le'.
IS,W3
M..
15,W3
15 WJ
15.WJ
H.
Goss Uld.s. 001
2].24]
3f.551
2].2x]
2 9,973
2],24]
35960
dale.
6111]
Flom Area Rapo(FAR)Gtoss Nee
182
2.10
IB2
2W
1 d
239
260
4,07
Floor Area Rob IFAR)'Rel Area
150
115
150
1..
150
203
225
348
Net L -seble I. -(9F%
215N
20,250
22,SW
24..
2And
30W0
33]50
51.955
Restdantsls
H..
23.250
19.50)
21095
1%.
2]W0
20150
dd..
Rohg
3,030
d..0
3,Wp
3,855
3AW
3,CW
4..
d..
IH OfeIROmns
enllalUnll ll lt
.11.
Olfiee 9F
Fisted 6F
Hotel
3,000
3,W0
3,0W
3855
3.W0
3, W3
q,Wp
-
9000
.8F
RaelOsnVa19F -(,—H
19,50]
23,220
19,50]
21045
19.524
2],34
29150
d],955
Estmale Unih (ba utl on avH.uml Nee)
Idarkot pale
21
29
2q
26
24
3q
37
60
Bbtllo
475
476
475
475
d75
475
415
475
(BF)
]00
]00
]00
]W
700
]00
]00
]03
2 HR
HBR 13F)
I,We
1,W0
1.OLb
1W3
1,0.'Is
I,
1.
I,
H
8
6
B
I1
11
12
12
1x
1g
1HRi ([unib)
B
9
8
B
10
12
19
2UH
HBR(Us nien
]
9
]
]
]
10
12
I6
arch)
23
2]
23
24
23
31
35
56
.ne,l(i
AROr
R Ix F)
6W
fiW
600
600
6W
600
603
600
,-B
1. WI
1.O
1,000
I. W
1,030
1, W
1 W
1
R p nits)
1
I
1
I
1
1
1
2
2
1 1
2
2
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2ER(in..1
1
1
1
1
3
3obloUl (i ulvls)
2
1
2
1
3
2
5
Tobl Units
24
29
21
26
2q
34
37
61
N dle.,
ReN4enpal
Messes do.(vdi xn, Por un2)o
1d8
150
1.18
1x8
"1d8
1.48
I60
1d9
ARmJable'd, 9er end
1W
103
1.M
1W
100
1W
1W
1C0
BobUUl 3pawe li)
Rehl
35
0
35
30
35
49
55
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6gm0.0)(K) 91
33
3.3
13
33
3J
33
3.3
33
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d""'
10
10
10
13
10
10
13
13
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33
33
33
33
33
33
33
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_
-
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6pamel
075
015
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0]5
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Sp
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Number
45
53
q5
51
q5
59
60
101
strose Antes ace(SF }6anc�o
303
3W
30J
300
3W
300
300
300
F)Sbb[
Gmsstedon,
350
3W
35p
350
350
350
350
350
s.(O
Tohl Partlig Aroa (6 F)
[..I
15.]59
U.M.
15.7A
17.850
15.753
20.6`A
23,BM
35,350
iOecesR.eh Toted
1.1
12
11
12
19
1p
24
6pausheve1s 12
q5
53
IS
51
do
q5
59
6B
101
3[aco Ytov¢h3 5
,-en xe-Pend(m.n.,
1p
18
1B
10
16
10
10
18
Per HOitlan. pmNiottItty Pla mines SUfi, hasetl
an recent tlevelopmenl
applio5o ns: emerglrg 0avmbxn ape rific Plan infnmx
on;axd WH)LUGE.
a PorHH.ba.donnelNx,oxxdor area essumptions(99%
in'
raUl anE dIx for se,
eensIds l), and tono.1- steed gross
9oorarea
bHmssflomareapereseebased o¢(1)sb¢el vn ll(orfirsl Wee flop
n;l2)aswmed sel6a[ks
above 3rtl floor.
6a ud an unilmu end nal loanable 11oor area by unit
type, por Cily
Pla nning Bbll entl HRBA
c Assumes 5 %ol Tior I aM] 5 %ol Tler2 nn1U br 3p
%lneome M1ouuM1Old
s.
s Azzumos 1.0 apaw 5hlvdo: l5 spew Nt -BP unl1: entl 20 spaces2BR unit
2 ilex Adman, Inc.
Pa 32 !B Sum _ 1IIxx R1Ax.1xrvI"i,,,,am
¢old
APPeitdixA
Physical Pammetem (coWdl
33 F -11A
lna
0ummer_Nen Ter ld2 RLV WITFI Fea wf /A9rrgram
Pa8a 3at8 J14 -14
Al lietlLSe
AldedUSe
llIudUS.
Mlietl.Use
Idx.tlL,e
AIISetlLSa
M1I UetlL Se
I.I IlleJ4 xn
9mblypo Nama
ReUII1ReslJenll ai
Ro.M.R Id..lal
Reta IUResIdenllal
RelalllResltle nBVl
R..M.e Id.Mal
0.elalllRe slEenll al
R.WW.sId.n9al
Rela lIIR.Il..ftl
Laa4on
Pim 6W
Pim
SM1I BIVd
81.1 Bhd
80. I—h Rlvd
So. Lincoln BN6
Dovnbvrn
Oovmlown
ry
15,117
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15,11]
15.11]
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IS.PoB
I6,W0
15.110
1 .1
ToU1 Gldd
Gross . Hea
2].29]
31 31 $57
2],26]
29,9]3
2],26]
35.869
40.140
61.117
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2
3
2
3
2
3
3
6
Fbor1
113]9
11,319
11,3]9
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11,3]9
113]9
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8,188
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16,369
11.994
14,369
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-
9.925
-
13,161
11,169
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-
11.199
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8.510
FloarB
8621
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2],29]
31,55]
2126]
29.973
2].24]
35.068
60,140
01,117
FAR loss Nea
182
2.10
162
211
162
239
2,68
401
Ne Fle Mea bvB Ory
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8,508
1D,113
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22,5M
26,258
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29.911
22.500
30,11
33,]68
51,955
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e?6k
632k
82.BK
83.1%
&1.0%
636rd
80.0%
858%
33 F -11A
lna
0ummer_Nen Ter ld2 RLV WITFI Fea wf /A9rrgram
Pa8a 3at8 J14 -14
RLV Result, SOMMI, Tier 1830evelopmeniprele,,,,s WIh Adel Fees)
App erela9
Oxv<IC pm<m COelel
merypur rm
Anumpllm'ri
Re r,l
l".
e1aie
malm�e,taaml'v1
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eee R, ma wile
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313'0
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$
$
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$
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3
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S
4
118145
111.141
$
1.11l
5
$
"I'le
5
391100
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ree Ppp.O $
$
$
-
3
5
5 -
5
5
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3
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3 3r4A79
$
S 36116,
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5
5
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5
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3
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$
i
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5
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5
196139
5
5
141156
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5
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3
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3
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559
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5
5
5
3
5
4
3
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ll
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5
5
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f ell,
3
6,111
5 69.1
$
3
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5
5311]
5 6'1.361
3
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$ 1.11
5
a,1ll
f elle,
3
S
fI001a
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5
$
$
3
$
3
S
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11
11:1d r-11 }
163,6.
$
5
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5 He'll
$
5
5
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}
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}
f
5
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$
1.140603
$ 11]99]9
5
11141.
$ 1a5,84a
a
1,703518
3
3..,
rudolal.1l asenx cerlx
3
6,566)w
3 I'ler63
5
836319
5 "Mi.
$
4:66]9
$ 8.1..1
5
9,38I,6H
5
16.351,693
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3
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$ 39039
S
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$ ere133
3
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$
98All
$ 19,3]
5
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a 134116
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papa were
peeepp.F
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Wan Remnly
156
3
5
3
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$
.1145
5 61],]36
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$ 718136
3
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5
1,].15,4Zz
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3
f
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3 B9JR9E
f
$
3
16A55,II6
f
ll,01 114
per CSF
$
361.3
5 t66 79
3
381.7
S 363.10
a
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3 zm11
5
266.06
3
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rdf — I1-1r, awprteMx.
.....I. eel- per He'I.I."A Camm l"C r, EZUWUUe YaTi —, miJ, MRSA MIeaez. Inc., baenuM wr wnax nale ze ru aM mn mis arcowualvl seynlel7
34 XF .I
rsw Reaulb $ummary -ner t 3 z cevdnpment Pmtnryces (With Md I Fees)
Appendlx0
P.p-d Nevv F., ExNlmn CH Fees &P -it Costa
91Jg3Cnnx4u[Ilnn Pemrll2
I.AxeJUZa
B4xeJUrn
etlLxo
etlL xe
FixeeL
Se
'uxetlJ)so
h4atlUxe
4xeEUSe
Pvololryo llama
9511cnx
RelallWesltleMla
flelalVResl6eMla
flelalMeiltlenlla
flelalMeilJen4a
RelalORexIJ¢nlla
ReIaIBReslJenlla
R¢IaIIIRezlJenlla PeIaIM¢slJeMla
Loralbn
xkassLk area $
11.1.
Pko BIVJ.
Pico
SI.I BNJ
SAI BW6
So.V
23,153 $
Sa.V NBp6
mm15,OT
Oo .n1o..l.
Ua
m15,OT
IaM AVea
53831
U.03]
U.Bi]
IS.W9
11,7
IS,VT
56116
$5,116
Commel[t¢I >IOK $Fld Jarlez
$11621
xkam b'a alea 5
GIass 0413A1ea 15 F1
3
S 3
V.247
2].24]
)1,5F]
2124]
23,0]3
31,204]
35,69
M.140
01,11)
PesNenRal Vnts
5]YI
A3]
$121
92]
5]2i
$1.
Ek Bakal
SI21
IKr po1M
SIZI
V.
IrlaMel Rala
$7.
$12!
5]2i
5]21
5]2]
Pfumblrp
Vn
wpoia�
5]2]
S]T
$121
a
S]Z1
5]P
8
B
0
B
I1
12
19
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8
B
6
B
IB.(v0
0
10
I2
19
2mR
162 5
d9, 133
]
9
]
]
i
]
10
12
IB
N.x
3.113
Commemkl4a slollez
b11501
xkam 5k area $
5
3 3
5
5
S
$
I BR
Tonanllmpmvamenls
50.3490
vk-bk area $
101>
$ 1.01]
$ 1,01] $
}d B9
1,017 h
10.41 $
I156 5
1343
?BR
SOZ132
•kavbk area $
-
1
$ $
I
- b
-
1
I
3
PesN¢n4a1111e1 Lea=zbb SF]
pse polxl $
13P'll
23259
19.E
21,045
$
1B,YA
2),W3
H.iW
09,WJ
Gd IVel Leau4H 3F)
41.158
f Sd.419
$ 61.158 $
3.OW
3.W9
}855
0.411 f
}W3
3,OW
4,0.0
4,OW
mreheal Leaa3be sFl
N41ellkler'
$1837
SV'mele15e1 gekq
$
$ 3B]] 5
30]1 S
303] $
1
}331 $
FneWe lAnfei
513,195
6 mzlee pev gojecl $
$
18,195
I.
I.
$ 18.195
New AI(ovtlaWe Nx &S1nMa9e Fee
Nrp
Illy $
10.195 5
16.1£$ $
10.15$
lNat a"BRUMS Fa[R1ks
flew PavFS Fee,
Nlp
Illy $
106145
S I..
5 05.115
$ 1?141
$
I..",
5
$ 1..4 $
201244
Feef
17.M $
S
16,]ID
S
S
$
S
S
12331
5
17. 5
]9 ]d4
6u4101a1
S
•3116
3
106,345
$ 196,6N
f 106,196
5 112MI
f
106,145
$ 190,33]
5 I.M. $
410,998
Pla mJng Pennlls'
Bublelal
f
66.133
f 63.111
f 55.133 5
$ $
61,311 $
65.136 $
68.)60 f
$
]4,689 f
$
VevelapneM Revleva
515.556
pnl pofeq S
-
5
5
5 15..ti0
5
Jlm. $
S IS.SS9
$ - 5
15.560
WvalopneM Agreemznt
5103,145
R ® 5
$13.8
$
$13.
M.
51 }p
$1476
51}]1
$1662
-
LIUI4d0vermaFee
a Pet m'ry GtJearta No. 2d201CCS), abopintl l,lar[ry I ?IDI3,Aawmzs TlF VN4lor evlilnp
-
ArtMeewalReNevvBOaeE
s2e s; 10.0]0 SF exlAinp vela0
ant IO.gp SF exhWg
oMce
m¢J ml lrm ue.
-
Coa9alZOnxGOn[e14Reuk'x
$
ASamesfeeveJ 451o1euslin91e1a0 on 50 %ol WUnlo'ane
151H1e61es,10.OW BF
eJYLr$IelallaM iO,WOSF etlsO,g oRUO aawmtlOr
$ 5
O
a Pet fY.1311 Cay fee wAMUks
Cakgohvl EVem ptlan
5146Y1
pev poleq $
1(612
5 14622
$ I46R
$ 14.622
5
Id 622
$ ]4,612
h 14,622 $
Id,6II
Re9a4ve lxdaa4an
5251445
-
EIR
f21WB
pvr pqM S
5
5
h
$
3 5
Su01o1a1
f
16.621
1 Al.
$ 19,611
5 )0.190
$
)
19.631
f )0.190
E 11.61E f
)0.190
M1 Re9 ^mmenl3
VMtiBa4on
Fee on O16m 3paoa
$I O B9
xleavde ere a a $
$ -
$ -
5 -
$
-
$
Wna1Vn8Tax
52M
ISK
xunlls
MaF
New ReWkMaVCam melG¢I
I.1
x$p
`v 4,994
S 63.115
$
$ 59,948
$
51,994
$ ]I.]30
$ $
122124
Tena,.Frt mmnwnla
IBJ%
.F $
x559I3F $
LSB]
$ 1$03
5 I,SW
5 1,928
$
I.SW
$ 1,5W
2.M
$ 2W3 $
2.OW
G m.I.
1IaM1el Rale Re iltleMal
513390
pxrurct 3
1910
$ 16W
b }WO
5 I.N.
$
6W6
$ 4,139
5 4,303 $
X.53
xka uUZ area $
13,59)
$ 11'+W
$ 13.5.4
$ 1].4W
$
13.59)
$ 135.W
5 I.A. $
I.
1B.fID
Olke
54.39
xkaiaW area 5
-
$ -
$ -
S -
5
-
$
$ - $
53.16
xkeeaGb area 4
-
5 -
5 -
5
5
5
5 - 5
5[MO1 FaaVles Fee
00
53.A
xka ssb'z vea $
82.AN
]4N3
5 62.403
$ fi1,3.
$
624W
$ 6I..
$ 9'+,p3 5
15Z.
CommelWl
5051
xle asaW aeel $
1539
$
E
5
$ 1960
5
1,530
$ L530
$ 2VW $
2049
Su5101a1
f
1)5,689
$ 161,i)9
5 1J6 }84
f 1&1,118
S
116.681
f 68.691
5 102 M5 f
)06.469
91Jg3Cnnx4u[Ilnn Pemrll2
q
PesMxn4al ApseMZMS
50.012)
xkassLk area $
11.1.
$ 31,2.
$ 1].]9J
I].]A9 3
24.613 S
23,153 $
43.310
mmncHl �10K SF
$11190
xkassNx area
53831
U.03]
U.Bi]
bl ?]W
$}B3]
$1,33]
56116
$5,116
Commel[t¢I >IOK $Fld Jarlez
$11621
xkam b'a alea 5
3
S 3
5
5
5
$
1 /z[ryaNml
5721
p ,I
5123
A9
5]YI
A3]
$121
92]
5]2i
$1.
Ek Bakal
SI21
IKr po1M
SIZI
V.
$]21
$7.
$12!
5]2i
5]21
5]2]
Pfumblrp
Vn
wpoia�
5]2]
S]T
$121
'27
S]Z1
5]P
$]Z3
SR]
B u eg nspecbans
,MAu
flesben.,l
$10236
xkav Ux alea $
IB.(v0
$ Y!,]Y3
S 19,9.
21542 5
S
I?335
5
2?335
162 5
d9, 133
0rxMS
CammelWllSlory
$0.]]62
xAav tla area $
?335
i
5 2535 $
$
3,OW $
. $
1. $
1113 $
3.113
Commemkl4a slollez
b11501
xkam 5k area $
5
3 3
5
5
S
$
Tonanllmpmvamenls
50.3490
vk-bk area $
101>
$ 1.01]
$ 1,01] $
}d B9
1,017 h
10.41 $
I156 5
1343
IOKSF
Tenant lmplaremenls>f OK Si
SOZ132
•kavbk area $
-
$
$ $
- $
$
- b
-
-
Geol¢NnplRepnA[
4?ISl
pse polxl $
$
$ $
$
$
$
5
SuMOlal
f
41.158
f Sd.419
$ 61.158 $
63.315 $
41.168 3
61,690 $
0.411 f
104.719
UIIfIy Sees
N41ellkler'
$1837
SV'mele15e1 gekq
$
$ 3B]] 5
30]1 S
303] $
1
}331 $
FneWe lAnfei
513,195
6 mzlee pev gojecl $
$
18,195
I.
I.
$ 18.195
$ IB.I BS $
IB,I Ya $
18.185 $
10.195 5
16.1£$ $
10.15$
lNat a"BRUMS Fa[R1ks
u9U URUeJ15
$1,169
I,e1 urv1 $
M.
b i1.1 BE
5 10336
S
19,655
17.M $
p.M $
16,]ID
2BR VnXZ
h1.651
ha..1 S
10,399
S
12331
S $
$
1213]
M.
M. 3
$
5
1]121 5
S
•3116
03,116
vgal
$P9
px11,AW Iea abY $f S
2337
S
S
1331 $
213]
Bublelal
f
66.133
f 63.111
f 55.133 5
$ $
61,311 $
65.136 $
68.)60 f
$
]4,689 f
$
106.565
30TAL
$
369.633
3 661,103
$ 3598)1 $
613,605 S
Jlm. $
.1.461 $
UTA41 f
1.15.460
pec GSF
$13.8
W.
$13.
M.
51 }p
$1476
51}]1
$1662
e App'M, G (ae caW W, &YGa
a Pet m'ry GtJearta No. 2d201CCS), abopintl l,lar[ry I ?IDI3,Aawmzs TlF VN4lor evlilnp
veU6 on 50 %olOmmlann
BNOSNee
s2e s; 10.0]0 SF exlAinp vela0
ant IO.gp SF exhWg
oMce
m¢J ml lrm ue.
s Pet CAy 5a14fiexus slWylemmmeMations.
ASamesfeeveJ 451o1euslin91e1a0 on 50 %ol WUnlo'ane
151H1e61es,10.OW BF
eJYLr$IelallaM iO,WOSF etlsO,g oRUO aawmtlOr
Pim Nle.
a Pet fY.1311 Cay fee wAMUks
51nJW.s melelaM mpXalANelas [M1alg es
35 mm..Ne.,n,laaR3v,JRF¢¢x.11
Pagx SOlB 1¢314
RLV Results Summary -Tler t 624ovelop,rcnt Prototypes (WM Add 'I pass)
AppendlaO
Proposed TIFINew PaMal2ecrealion and Alterable Housing Linkage Fres
tabs
.-dl,.
I.VxeYVae
1.!IxebVas
I.IiXas.,a
unnalln.
ks.ra
lou.,LSe
a
Pm.,. Vama
RelaNRealalket.
RelalMealde Mls
pdalailvidenk.
H supearker.
IaIOAes lopur
Res'llaw dude
RelappandeMia
rnare.s.
Laealun
pfeo Blvd
pine
SIA Bird
.11 .111.
Sn Harris Rlvd.
LI
So, neap. 914
Oed.a -a
own2lown
W[ETler
1
2
I
2
1
2
I
n..a
xe,JJ¢ f
IS,WO
15.033
Iin.
xellp
r'..
M""
fBR
ss BNO. Nea ISF)
Mal
3155]
2].24]
RO]3
2 >,2n41
/9,140
BL11]
Res..ppll s.
24
an
24
N
24
34
32
BI
Markelins.
23
1
p eI 154' Henn Ins, a. apse a an, area5
2q
23
sn
}5
5B
.an
B
k
B
0
Net Fro
12
IO
1 -BR
B
9
S
B
10
FL{
10
2-BR
]
8
]
L1q
]
10
12
4.....I
slant.
1
2
1
4.6¢ f
1
3
J.In f
-.
, BR
1.11
Paarr per unit $
$ - S
-
ar $
5
-
2-BR
133.294
Ma,ke[0.a[PNea2
a0A96,116
$3joD Peru 1 $
]59b
$ 4lpiB S
]S.
S ]O,f62 $
k'sopead".11ea". a,
19580
5 - b
le'.
21,015
19503
$O,. per unpt $
A,]50
an.OW
L,puk His, Leassbk SF)
3,m
a'.
3.
`BSS
J.WJ
J0.tl
9W3
.ean glel Leasbe SF)
5 - S
-
$ S
$
-
S OIWO 5
eq,W3
Petal-Nea2
IIIXei I11e1 Lea.u. 3F)
j30.50 xkasa0le area S
_
im
$ 9.9J 5
p0.30J
S 116.QM $
,3B] S
9.39
$ - $
fbw Nea AlkaNade to TIe,2
.golleal
$9]0 xkazable area 3
-
Bryio.a
W. ...ableaea
R allun6e)
5
2
Bote4Neal &2
10
$3E0 xk.ubkarea E
24
arnpa
To1aI V,Ns
5 $
S
3 5
earners
tabs
Berne
2
a
]
0R
d5%
3193.] xieasde mea
f x6,J3d 5
2
2a,$Ja 5
5
xB.SX 5
3
5 35,I1a S
]
2-BR
d5%
$.nli akasde area
-
5
5
$
$
2
$ S
]
Artol6zbp VNlz
5 xgJJd 5
xe,JJ¢ f
26 }W f
55,6¢0 5
x¢pN 5
xellp
5 J5,S13 S
soma
fBR
1
-
I
2
2.BR
qe%
5105. xkasab'e area
5 u..OY) 5
(65.0Y1 5
perpsa) $
(..BI8) 5
(G3.&l5) $
(..eJ5 )
S ("' ) $
1
p eI 154' Henn Ins, a. apse a an, area5
75
]SOJ
1..
1
5
U.
1.
1.
Net Fro
j 5
S
f
5
S
.a Fader
FL{
no '�.
S 108.1¢6 6
I ]qd
106145 f.
L1q
iD¢1H S
SSpr
B Fees'
4.....I
Feeapea05F
S Ja. f
4.6¢ f
J.9a f
5.19 $
J.In f
-.
Ma,ket 0.a[PNeal
1.11
Paarr per unit $
$ - S
-
ar $
5
-
5 V1,W0 $
133.294
Ma,ke[0.a[PNea2
a0A96,116
$3joD Peru 1 $
]59b
$ 4lpiB S
]S.
S ]O,f62 $
]5.9T E
Ot%
5 - b
0.6%
anfoulable
1.5%
$O,. per unpt $
-
5 - S
-
$ - $
5
-
5 $
9e l -Areal
$23.IX1 xleasable area S
5 - S
-
$ S
$
-
S OIWO 5
eq,W3
Petal-Nea2
j30.50 xkasa0le area S
_
im
$ 9.9J 5
p0.30J
S 116.QM $
,3B] S
9.39
$ - $
-
.golleal
$9]0 xkazable area 3
-
Bryio.a
W. ...ableaea
-
Bote4Neal &2
$3E0 xk.ubkarea E
S S
5 $
S
3 5
earners
$
]E6 ?OJ
$ $
Ina".
$ ter'. $
1E629 $
p12.
$ 1]509 $
23]246
Is- Fee on FtlzmO Rasa BF Nea 1
$x1M xk.abla ..a
S 05],5 ,
Iese, Fee on FnabB Rule SF Nea 2
$30.10 xkazable area 4
E 215 ]w $
J257»
$ 1225]501 S
sB S
ns]W
NETTFer.
t
2 5
f 5
5
S 1],600 5
l0,idd
Proposed paktansoreatkn Fee
26%xM1Wlmum Feez
1.Rate lkugrg
Yv%
B?suraPJ149S
..I u
od Rs
R%
516539 per 5
e5 ?IS
$ 96[5 $
66.216
$ S
?15 $
115216
S 03 ?N $
223,SIJ
h's
25x
320,661 par $
4065]
S 9.A9] 5
Sq
96,65]
...7
5 96.65] S
b.fi5] $
B4A.
E ]8824 b
I]3.16J
pMa,tlabk NOU9ip
$0 per un3 $
re"',
$ $
5 g
5
5 S
R.
25%
55.95 rp. an. $
9,905
$ 485 $
0,905
$ 5,1. S
4.485 $
$ BB S
oleo
25%
Ss1q x purais area $
-
$ - $
5
-
Rdel
25%
Misr xkassbr ar r S
4 $
5
Wa1Feo
f
111 ?50
E 15].8 >] f
111 }50
f 125,3. f
111 ?66 $
205,650
I 166,20] $
901,461
I s: Fee oa Faalu,, Retali 3F
Refa¢
25%
5548 aan.. sea $
(11,213)
E 111 ?I J) S
(11.21J)
S (11 213) S
(11,210) $
(11,21] )
S 1
1112J) $
(1f 213)
25%
'14 xkasbk erne $
5 f
f S
f
Net Fee
S
105,196
5 1d6.6U f
106,166
5 i12,i41 $
108.1 q6 5
19655]
$ t]401d $
E91xH
Propoaed ABDAaHe ROUSing..ad. Fa.
I6%xaHa]mum Fous
late � 3618 ...T.,¢xRLd4,,RF .elm 1x..,4
Berne
Re1ae
d5%
3193.] xieasde mea
f x6,J3d 5
.24.33E 5
2a,$Ja 5
5
xB.SX 5
:B.JN
5 35,I1a S
as.113
Bike
d5%
$.nli akasde area
j 5
5
5
$
$
$ S
SaMdal Fee
5 xgJJd 5
xe,JJ¢ f
26 }W f
55,6¢0 5
x¢pN 5
xellp
5 J5,S13 S
soma
Less: Fee oa FatisO Rela6 SF
Reask
qe%
5105. xkasab'e area
5 u..OY) 5
(65.0Y1 5
perpsa) $
(..BI8) 5
(G3.&l5) $
(..eJ5 )
S ("' ) $
f63.$Y)
OI6ce
ds%
uuru 1l kaaaIXa area
S
$
5
S
Net Fro
j 5
S
f
5
S
E 5
muar dFee.
S 108.1¢6 6
H.L.241 f
106145 f.
112 1411 $
iD¢1H S
100 }5] '.i5
195¢]4 f
4.....I
Feeapea05F
S Ja. f
4.6¢ f
J.9a f
5.19 $
J.In f
6dl
5 41a $
1.11
vekpmenla.at
f 2q,d1d,416 5
J0,941A09 f
50.101.x15 f
40,005,000 5
20 2 $
6¢40.¢%
JOp85,11E
4 MAIN112 f
a0A96,116
Feeaas %Bev Port
0.6%
e.6%
and
Ot%
0.6%
04%
1.5%
late � 3618 ...T.,¢xRLd4,,RF .elm 1x..,4
RLV Resulle Summary -Tier 1 & 20eveloplrcntPmtotypes )wth Acel I Fees)
AppandixE
Net Operating Income
Rolelype llama
loolbn
Rete Be. Are
G- a m tsE)
SNenbl ueni
I.Iarkel Pale
SIWb
1 -RR
3RR
pllortlab'a
10R
RR
tt.(t tee. "e F)
Otlta(.tte(Lea..abk SF)
Na[el (NeI Lea side
SF)
R@ M,l s
Pe(aa
Glfiz
ReSlEengaL l.la rkelflale
F 61ba Reg Z.Ierel
1 -BR Re NA.L111
2IBR Pe MNN01AOn111
VnAS lmpnoMear
gM1erlmv
1- 1.116Celleggn tell
wlwme (EGI)
exs OPo'p_ -eB Elp211YS� q. fe rve)' $
IIA GparaWpinmme
NeS'..BaI ex.We(U.,M[wne
FI BR RenINrv6l,fonlM1
2�BR ReNNnNl,foNll
Vnils lnmme/Yeal
gM1e:lrco
sslm
Leis eGI.- CoAadbnlos:
I.-. Gross lrvwne (EGI)
Less OpelalN9 Expenses (mulowrve)` g
Nel Gpx atin9lnmme
Rd.f
.e.Oe RaeV5Fr1A0.11(NNM
Less�nlall mmWee:
Vamnry8 co6eabn tos:
EIbGNe Gross Ir[ane (EGI)
less'.Vxehnbulxid Opeml'mg Erpenses
NeI OIR nlvg lnmma
o ad
Ave:a ge RenV8FlA90nN (N NM
es Re nlallrcvmette ar
paMiq lemme4
as Vaamy8 C00Mbn Las:
ERZGive G:Osslrcane (EGg
Less t,e h t`o Optalin2 Ex pens
Less'Pa:hp Ea- e
NelOm:a16,91nmme
TOY, NeI Op -te.,t 1ne.me
I.V[eEUie
NAxetlLSe
IAI[e Wie
I.YxeJLSe
113[eJLSe
1,'LetlLSe
I.IIx¢trVxe
Ii, Se
55� fIDi pJf -ega flefalMesitlenlla
ReIaIVResltleN la
flelal lJenlla
flelalMeilJentla
Ree. eIvla
4 ?325
flelalVR¢xlJenlla
,I
RelalORezlJenlla
PIm BNtl.
P'vi
31,1 BN0.
11a
SM BNJ
Lt- tlt
3a.LWaIn BNJ
So.LIfl 1, .1,Oa
So. Llnmin BlvJ.
Wnnlarvn
OonNOnn
150.tl
15,OT
15,0]3
y.W3
1
15.03
16,WJ
$
3)34]
S1,R]
Zl.x9]
28,8]3
M973
., 17
Z]R24
�' 3d
40,140
61,11]
S OX aVrvlslw
me $
z4
3],163 $
Ww S
$5,]W 5
81538 S
61
%b.6W
P
23
23
YJ
31
36
U
3
9
B
B
58X
I1
12
IB
8
B
8
B
0
f0
13
10
]
B
]
]
]
f0
13
IB
7,0]
Vell 5
(161 M3. W1 3
2
116f00.W1 S
Ml W3. W1 3
1161001 S
1317001 5
(252031
S 13929]1
5
07,925 5
5v,3]] 5
.1 ?I5 S
2
46],425 5
1
10]6,670
5 L6s ;047
5
399 S
3
S
5
J.Bb
1BU
303
100
dW3
4M)
M15
U
d5
51
45
59
69
101
q3
$
39
4,660
I9
55
BB
o
10
10
13
10
10
13
13
Va Iles $ ?I6 S 216 S $ 3. 5 3. 5 4
$ ]7. S 101520 S 9.4U S S 12600 5 5
50% xteosslneome S W. S P. S P. 5 116.6231 S 11630]1 S 16301 S (120]1 S 112,0])
S S 5 `514,,0 5 123p30 $ 119,]0 $ It9,70 5 Zi9,4W $ 25 .
]0'A i I S ]22161 S 5 5 3710 $ 691 S 3591 $ (1182) $ Il 1.4
G $ 11660 5 ]1 656 $ N,UI $ M212 $ It". $ It8,t. $ 352210 $ 253310
Vae¢s
SI¢13
SI.61J
SI eYb
1"..
$1613
51613
52160
$?1W
52625
4 ?325
5?&l5
5?fb5
5?3L5
4232$
U.IW
U,IW
Vatles
Vt.ro3
p,ro3
},m3
53.4m
g3.m3
y.W3
$4.
Sd0»
$
MO $
]49.?A $
714,.6 $
714,0. 5
630,00 $
851.850 $
M.
$ 2061.OA
S OX aVrvlslw
me $
31,. $
3],163 $
Ww S
$5,]W 5
81538 S
43593 $
%b.6W
S 10$.MV
S
5
651,500 $
]66.]13 $
741.7. S
749,70 $
E0I.. S
094443 $
1690,69
S
58X
.G -l- $
U. 4
$9336) $
131 4
IY7485 $
M. $
(44 .7 3
1699$01
S 110.1
$
638935 $
747)7] $
113.315 S
]13315 $
6]0.48 S
049.]31 5
13.66]0
S .05047
7,0]
Vell 5
(161 M3. W1 3
116900.01 S
116f00.W1 S
Ml W3. W1 3
1161001 S
1317001 5
(252031
S 13929]1
5
07,925 5
5v,3]] 5
.1 ?I5 S
5 5,215 5
46],425 5
n?nt $
10]6,670
5 L6s ;047
5
399 S
S
5
5
$
S
S
5
Ln 5
$
7 $
aQ S
.7 5
$
137
$ 43]
S
$
S
4,660
9,812 5
9,041 5
.
Id.599
9912
3 XMt
10%
xunda llvmne S
5
S
$
5
41 5
ItEt $
5
t,
3 Y+I
5
4715 $
10,011 $
14715 5
$
10,011 $
4,715 $
7.
14V. $
10,011
5 35,319
50%
xGroxx llvnme S
5
011 $
z36) 5
01) 5
$
V. $
9e
3 11269
$
4.4]9 $
9,510 $
44]9 $
8.610 $
. $
9510
S .4.033
/,00
xVrvl 5
V. 5
id WG $
110. 5
114 QU 3
170. 5
,.
N $
19.1. $
190.1
$ IS50.1
S
( ;s.p S
19,99) 5
(?52p 5
(4,90) S
( ;52p 5
(1.m01 $
(4,49)
4 (10947)
Va Iles $ ?I6 S 216 S $ 3. 5 3. 5 4
$ ]7. S 101520 S 9.4U S S 12600 5 5
50% xteosslneome S W. S P. S P. 5 116.6231 S 11630]1 S 16301 S (120]1 S 112,0])
S S 5 `514,,0 5 123p30 $ 119,]0 $ It9,70 5 Zi9,4W $ 25 .
]0'A i I S ]22161 S 5 5 3710 $ 691 S 3591 $ (1182) $ Il 1.4
G $ 11660 5 ]1 656 $ N,UI $ M212 $ It". $ It8,t. $ 352210 $ 253310
530.560 $ 635.51,, $ 812.344 4 668,937 $ ttlm1 $ 741630 S 1,]0459:1 S 1,006.110
`..e al Real E..Ie Na nagemeN annual.p .".1 tlala Iota... b M,,,e In LOS M9eks COVnly
a Pet HRBAIe. el mwtel celaaM( rdal Fee."Poel s0(re Mtleve bpme NVSltiere tel re -95 %x m,mlonn, PVw =BS %. W.Ie-OPm
antl apalMenl lenlsa evk'xp'eMUms al the appal Y011es. 1.YI IS axmmeJ lo e.Ieel se ee'e L
er CA�s:e nl wNed/e aM ltnA -.o.,
°pswmex 5200'mONM1.se1e)(101 01suppv); 516&moe.-- M(.etr. M$A9tnonlb tla }'use (5%).
37
le9eldl "I't
50% v teelG:oss lrmme S
SO% xEGI $
- 5
50 D% vPaMylrcome S
S
S
$ $
S
$
5
S
$
S
$
3
. $
530.560 $ 635.51,, $ 812.344 4 668,937 $ ttlm1 $ 741630 S 1,]0459:1 S 1,006.110
`..e al Real E..Ie Na nagemeN annual.p .".1 tlala Iota... b M,,,e In LOS M9eks COVnly
a Pet HRBAIe. el mwtel celaaM( rdal Fee."Poel s0(re Mtleve bpme NVSltiere tel re -95 %x m,mlonn, PVw =BS %. W.Ie-OPm
antl apalMenl lenlsa evk'xp'eMUms al the appal Y011es. 1.YI IS axmmeJ lo e.Ieel se ee'e L
er CA�s:e nl wNed/e aM ltnA -.o.,
°pswmex 5200'mONM1.se1e)(101 01suppv); 516&moe.-- M(.etr. M$A9tnonlb tla }'use (5%).
37
le9eldl "I't
PLV PUSUIh BUmmary-i1e1183 UevelapmeRIPZOIWl . l IW111f Atltli Feee)
AppentlliF
Pesl tlual Lantl Values
U ip &yESphH¢pp ap Warlerx013. LOa Myeks Nw Yrla
,wsx gp�ol PofaxRU.
38 S— Re, T., 192R19,a11
tAIVMLSe
ra,erypo llama
g55VNpyppS
RefalORes lJenJal
YI6M
�b
al
R.
R- m
91NenJ
51
..lJ.,
Sa LM
6o,AV 4e.l
W1
DR—R,-
pa
his
SW
Bby. Ma19Fl
]1.55]
11311
39g]3
n191
ssesB
90,190
61.11]
rzesbemm unn
m lnel Leauw sFl
-
ncaplmtea
-
-
xelell11a1ma ui,59 R,
-
Pmkaly
lu }a nlOg I--
From Pop.E S
<e]<ES
S SSB,]t)
3 SSI,x 15
5 551}15
5 90],25
5 P3,]31
$ 1,W 66]0
5 1.655 eaf
RI .1 R.I. $
BBiy)90
5 145]5.915
9 fo SpgxB)
$ RB..1.
3 OB19?f0
S I1 Pb,l ax
3 .1,314538
$ ]I ]9]S'A
m oNM
Rxlcp
ntiy lmvm
cram Mp.E 3
(xSxp
3 p.iPl
$ IE Sip
5 ((91
S R.4p
E (].010)
5 (1<iRR
5 11091x)
Sw•R
Vap,Pafe'
R1 ,I`. — 4
(9],55s)
E Iel,]17)
E 19],555)
5 (01]171
4 Id].zwl
5 11]i}w)
5 (01,1]1
3 ORR R,
el oyn6p lma�m
Fmm App,E d
11,656
5 11650
5 Rlssl
$ 134x13
3 IIII03
5 118103
5 3]3318
5 3]3318
G Ra
6,608
RoVC Vp R.. 5
1.15514]
5 I.OLS6f]
3 1.11x,1]9
E Ieil dfl
S 1]59]3]
S I,xs9]E]
$ 3518.x55
5 311B<55
Ilel yanNg lmorm
irem ApO.E 3
�
3 -
3 -
5
S -
5 -
5 �
i -
R4O1
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f
d
S
4
5
5
i
ilal Plokal va We
5
fesxpry
S I1.6lsAf5
f ft.z30,t 69
3 13.136,1 [o
j 15 }31,801
f 18666.0x5
S 3),I98,E6e
f Sd.xJ ;z11
llmale
air^Y
-el NVwaE
w s
1.15x.9]1
i 'I W9,aYV
E 111.., .1
5 iz.S09N
s m,531,W1
E 1x555095
5 2131M.
5 .N WI,
(533,19)
5 (I,99E,B91
(1,471.1.)
5
1310]5
$ ("."3)
5 (4].15)
rwwio�..wPnw(ld.s m cox
lzww
nem µ o- E 5
o11z
s 3]x99 B
5
s naw of
s n asw
5 936
5
118,3
s
MVaM1U
1,953
f
1.513}58
S 1, 569,'Zd
5 3.165,6]]
3 z.
f 3. 95
S ; ],65]
S
S B.
pe sF l+M Prea
f
181
3
f 311
S iB3
f 10
$ 114
$ 1.
S 653
U ip &yESphH¢pp ap Warlerx013. LOa Myeks Nw Yrla
,wsx gp�ol PofaxRU.
38 S— Re, T., 192R19,a11
Fe(um on Com /Developer Pmllt M1laryin
Fes ills Surrgrei Tier & 2 Development Protalypes (MMAW7 Fees)
Program 6 ummary (see App, A)
,an. J1
10 Bummer tlmv Ter 183 POO VA7H fee rvll5u mmary
-2114
Ir11RedU Se
MlaetlLso
MIxe4Lso
Mixed -Use
"Imes.
MIsse.so
Irft,,on Se
61load go.
those', U.-
R¢ ogint. mm ai
RoU IIlges ldenUal
Reixont.aldennal
R.'s"I¢slt.ms,
InlalW"Idengal
R..111R,omen11a1
Relainnesldennal
RetafteRsold -ml
Low SOm
PRe 8htl.
Fire Blvd
ml at,,
.1.I BhJ,
So, L'ercoln SRI
So,.-In Blvd
Posvnbnn
OoSetam
LUCET r
1
2
1
2
I
2
I
2
patron Repulremenl
6 paresis
Bile. Heigh lFOel)
36
35
en
36
36
Sa
39
60
Stones (1)
2
3
2
3
2
3
3
0
Sib .a (A,)
16,.13
1 roe,
75.10
1g..
mon,
15..17
Io..
15,N0
Cross pan An. (W)
2].24]
31.55]
2],24]
29,973
2724]
SIR.
A".
81.117
Floor Area No. 1AR) -Cross Ale.
182
2.10
102
1..
239
2.
4O]
Flo or Wee...,FAR)- Net Ne a
150
115
150
166
150
200
225
346
NetLeasablero-
Reads.1.1ml)
19,503
M.
19,503
21,045
IBSM
2],0.'1]
29,]50
A...
Marvat Rate Units
23
21
23
21
23
31
35
56
AgoIsblo Wits
1
2
I
2
1
3
2
5
ToUIUA,a
24
29
St
2q
3d
37
Retail (Sf)
3,W0
3.oW
3,055
3.CW
q.OW
4,000
oMae (SF)
Novel 1SF
O¢volopmonl Costs(soe App, 98080)
Load COS.
$
1.620.139
$ 202'021]
5 3211.515
$ 2839.103
3 2.202911
3 2,82.',178
5 10522.759
$ 0,778817
H.rd Cos.
$
5,421.664
$ 6.236091
$ 5.421.664
$ 699],183
3 5,421,664
3 6,903119
$ 7,865.126
$ 17,.11.7.
Solt Costs
N¢tls.,WR -aa... Fee
E
106,145
$ 146,834.
$ 108,145
E 112,141
3 106,145
$ 190,33]
$ 1]4,0]4
3 391,244
N¢t Amen.... Honoe Llmage Fee
$
-
3 -
3 -
b -
3 -
S -
b
$
]If Fee
$
3
5
b
3
S
$ 17,500
$ 70,]14
other City Cos. (as. App E)
$
251.658
$ 313,641
3 .1..
S 309,832
5 261656
$ 349,292
5 372,[05
$ 560,540
OMer SO8 COS 15
1
785217
5 959.233
$ ]85.21]
5 665,815
$ 105217
$ 1023]00
$ 1 153206
5 2340,4.1
Flesevon COS.
$
54].72]
$ 634.414
S 565996
S 618,322
5 %3.864
5 119246
5 A...,
S 1]33523
1.1 O aveb'gaom..at
3
8142118
5 10.268.227
$ 10,412,141
S 10143,272
$ 9.331.457
$ 1207B,96o
5 20,933,596
5 .. 8,92)
oer G6F
$321
IS.
I.
$.A
$392
5337
$523
I.
tieI Opera en l.I ...... 11(sea App, F)
Readontal Mortal...
Emesove Cross lnwma
$
M421
$ ]9],3]]
$ 112,215
S 112215
$ 628,425
5 049,721
5 132$610
5 2.055.847
Less: o",no, Erpon...
$
1810.1
3 1109 ¢U
$ Val W0
$ 11816001
$ 0610.1
$ (2170."13
S D1200g)
$ 392.131
Net In N.I.R I-ree
$
4.1.425
$ 556,3]]
$ 651.215
$ 551,215
$ 407,425
5 632,721
5 10]6,6]0
$ I.Sga..7
Rosiopeol ftwooble
Egro". Cross I....
$
AAm
$ 9,510
b 4.4]0
5 9,S10
S 9,419
$ 13.9.1
$ 3510
$ 24,053
Lass .parole, Expenses
$
17.1.1
S (1472.
$ (7,0301
$ (140.11
$ I1W0
5 121..131
5 (14.0001
5 135 W0)
Nal.,em n91nremo
$
(2521)
$ (MAN
$ 12.521)
5 (4,490)
1 (2521)
$ ()Ono)
5 (4.493)
5 (10947)
Feet
EI(eoNo Gmss Income
$
]3.0]2
$ 13,872
1 98.444
$ 123,030
$ 17,,]00
E Im.g.
$ MISS
$ A.
Less .'.net n Expenses
$
St216)
$ 12218
$ 20931
5 13]101
5 ISIS,
$ 35911
$ 9.1821
$ (7,1021
Nelopem8n9lorne.
$
71.A.
$ 71,6%
$ .1.551
5 1.212
$ 116,109
$ 116103
5 232218
$ .2.210
NO mwme
-
$ -
-
$
s -
$ -
$ -
$ -
loss: pareosa
cemergoonto a
5
$
$
$
$
5
$
NotO
Nel opeu5n91nwme
3
-
5-
$
5 -
$
$ -
5 -
5 -
$
5 -
5
TAaI Net.pero4np Tome
3
Con".
S 625543
$ 6422,5
$ 66693,
5 551mS
5 741.020
$ 1394r3A9
5 7085118
Proleat Campononl gains, (sea App. F)
.aroan4sl"Reat Rate
not
$
467,425
5 556311
$ 551215
$ 551215
5 46],425
$ 632.721
5 1.016.610
$ 1663047
Cap Rate
630%
630%
R.,
5SU5
5S0%
530%
530%
I'.%
V-1-$
6019,340
$ 10,8!5415
$ 139 .1203
5 Io,dN,203
$ 3819,340
$ 11,938.132
$ 20314620
3 31393,340
R.o'..elAnnafablo
Not
$
(2,521)
S (4,490)
$ (2521)
5 (4,4.)
$ (2,521)
$ U."IS
$ (4.493)
$ RA.4])
Cap Rate
630%
A..
530%
53PA
530%
530%
63U%
5S0%
Val.
$
(41,566)
$ (84.717)
5 (97,$66)
5 (84.711)
$ 19],568)
$ (132239)
$ (84,717)
5 (A659>)
porn
Not
$
71058
5 71,656
$ DFmI
$ 120212
$ 116109
$ 116109
$ 232,218
$ .2,218
Cep go.
660%
A.%
360%
860%
A.1
660%
3SSS
860%
Value
$
10.S..7
5 1,005.697
$ 1,41],439
$ 1.821394
$ 1159,22,
5 1.]69,4]
$ 3,510,455
5 3.513455
OMw
N01
$
i
E
5
$
S
$
5
Cap Rate
640%
640%
640%
B1O.
640%
640%
340%
840%
Val.
$
-
5 -
$ -
$ -
$ -
$ -
S
$ -
Total Pmpct 1.o
$
A.I.A.
$ 11536595
S 111/0158
$ 12130960
$ 10531031
S 13505095
.3]40268
S 34705248
Developer Returns
Developeles.
Tonal"Otest Value
$
9,651,471
5 11,5..395
$ 11,]]0,156
$ 12135,80
$ 1C.I.Sel
$ 13.565.095
$ 23,748,266
$ 34.7.1,248
Less: Ta.I Da........ Sosl
5
0]42110)
$ (10266.2211
3 (10412141)
$ (10]43272
$ (6331<5I1
$ (12073950)
S RSAC0596
$ (50008921
Profit
$
1.115353
$ 12]0168
$ 1358,015
S 1,393668
$ 1.199,544
$ 1000135
3 2,751,670
$ 3016.321
%ol Valuo
113'%
11.0°1e
11.3%
11.6%
11.41
11.01
11.6 -4
ll.oY
Fear' I. are
$
1.2321e4
5 1.431554
$ 10]4,096
$ 1517.1.
1, 13103]5
$ 1695,63]
$ 2,963533
5 4.539730
Clang. N Ina.
95%
-113%
-]9%
$1%
89%
-12,4%
1".
-120%
Fea slbie2
Yes
Yes
Yea
as
Yes
Yes
Yes
Yes
Freon on 1.1 .evelopmsnl Can
mg
$
536,560
5 625543
$ 642245
$ 660,.7
$ Sm'.IS
$ TAUS0
$ 1,304,598
$ 1.065110
Total Oevelonnont Cost
$
0,742118
$ 1.26S,221
$ 10412141
$ 10.743272
$ 9,331,457
$ 12.0,8,960
$ 20,9 .1,598
$ 30806027
Rehm an tosl
6141
60B3e
6.17 °%
6.21%
8.23%
6.14%
6.21%
8.10M
Re turn on Cast No Fees,
622%
6,19%
324%
320%
631%
625%
82]%
619%
Change In Rehm on Cost
4106%
L.1)%
d0]%
4107%
Oo0%
-0Rlll
Ira'%
2,09%
fee Ina!
IP ar9lnal
Marglnal
Marglnal
11 ... Real
Yos
Yes
Marglnal
Marginal
,an. J1
10 Bummer tlmv Ter 183 POO VA7H fee rvll5u mmary
-2114
ARPendi.A
Physical Parameters
40 gam _ HRBA Ativlwra. lnn.
mar No',v lkl ldz ROC NgTI Faary vM ram
pago RelO 1-2 ]¢0.14
Mlxe6Use
I.IIaedL.-
h1n d.o.
lllue Us.
MN.ULs.
IAIxed Use
AllxebUse
11.odle.
Pcood" Name
.1sUlResldenU.1
RelalUResltl en0 al
RelaNResM aortal
rye UIIIRas Menpal
Relallnn- ltle0a1
Ussd..sldenual
RetedUReeldenllal
ReUl.sld -LO
L,mL,n
Piw BNd
Poo Blvd,
.11 BNd
661 BNd,
6o, Linwln Bhtl,
So. Linwln elvd
C—dovm
Oownbwn
LUCENea
LUCE Per
1
2
1
2
1
2
1
2
Permit Repuilemsnl
i Palwls
Bltlp_Heip 61(Feel)
30
38
38
36
33
60
6lades(Y)
2
3
2
3
2
3
6
Lantl Alea(SF)
15.0
M.
IS. W3
IS W3
15,090
15.OW
15..
iS,OW
Gross 0M9 Area (n F"
27,297
31,55]
21,247
RH73
27,241
3 A.
g. "s.
0111]
Floor Ama Robs (FAR}GmsS Plea
102
2.10
102
2W
IC2
239
des
4.U7
Floor Ama Rab(FAR}Nel Pre.
L.
1.]5
1.
166
150
2.
225
340
Nel L.ses. Nsse(9Ff
22,5.
26,250
22,600
21,9W
225W
30..3
33,7.
51955
Rsoi..np
'U'.
23,2.
1%.
21,045
M.
2],M
.,I.
40,OW
R'bil
'
3,0.
3.0.
3,855
3,0.
3,.0
4,CW
1
011ie
Ho @1
AHobl Raoms
-
-
-
-
-
-
-
ResldenOalUnlllAlx
Offiw SF
ReUd6F
3,.0
3,W]
3.CW
3p S5
3,.0
3.0
4,.3
4,000
Reslden5al6F- Tar9e1
19,5.
23,2.
19,5.
21,045
19,503
27,0.
29,750
47,955
E.o..IUniA (ba utl on avp. unit dze)
2q
29
2d
2U
24
3d
3]
Markel flele
SWdio
-
-
-
-
Pis
1�Bfl (6I)
7. ].
7. ].
7. ].
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0
8
0
0
tl
12
19
1lUR(
1BR(...)
0
9
0
0
0
10
12
19
29R1(I
]
9
]
]
]
10
12
10
sn
9ubbbl((units)
23
21
23
24
23
31
35
50
AMOetlablea
241RU (SF)
1,0.
1,0.
1,A
1..0
1..0
1,.3
1,00
1,.0
1b Rli uni6)
f
1
I
1
1
2
1
1
2
2I l(I
nt
I
1
f
1
3
t
9u.ObUl((uNls)
1
2
1
2
1
3
2
5
iodl UniH
24
29
2d
29
2d
34
37
61
ParMn9
RevdenLsl
I.b that Rab (vzW. ev9. peeunll)a
140
150
1.40
IAB
198
198
150
149
ARordable(av9 Per undd
1.
IM
IW
1W
1CC
1W
1W
L.
6ubbUl n,on. (i)
35
43
35
38
35
99
55
8B
fle6il
Bps w s/1,O. BF
33
33
33
33
33
33
33
8ublodl 8paus(()
10
10
10
13
10
10
13
13
C.
Spacesll.AV 6F
33
33
33
33
33
33
33
odl
8pl.eslGUesI ROOM
0.75
075
0,75
Ol5
Ol5
075
075
075
s
Nu,mber mb,,
q5
.
45
51
45
59
6B
101
Gross Nso Cos. lS F
"SEE
Gmsi NealBpau (8 F)SU6t
Todl Padiy Aeoa (S F)
15.1.
10.55]
15,7.
17,053
IS,IW
20,650
23,80]
35.3.
a
ubL Leve is TOd1
9 SULL
11
1t
1.1
12
1.1
14
16
2d
Bpaces ls l2
d5
53
q5
51
45
59
0.9
101
6pauNL—evels 7-5
-
-
-
-
-
-
-
Consua.d.n Pedod(medhs)
1B
10
10
10
10
10
18
10
Pol guPOr gu idanw 1n95UR.basetlon
rewnl sovelepment appllatians; emedinp E-1— 6paobc Plan W— 6,
antl M. LUCE.
z Pes Nft3A. bautlon neHO9mu Hoar area sswmptlons(. %bcleUil
antl 6]M for for
le sitle nfiaB.aM panxla4on
olbUlgross BOOl
alga
Is groesdoor area lseeflool. Used on ll)s0eel
wall for firstN ee OVars; l2)assum atl uWacks aWVa 3rtl flooc.
s Baudonu nilmhantlnallaasa11e9oola...
by Uetil lyps, por CM1y planning SlaRaM HRBA.
' Assamaa s%br l I
boltla.
ft l C s,olnelz
s Assumes 10 spa u slaludo:lS spamslt
ss
R l.Ul30%mw —sZ2 -B
-aft uni[ antl 20 span s2 -BR unit
40 gam _ HRBA Ativlwra. lnn.
mar No',v lkl ldz ROC NgTI Faary vM ram
pago RelO 1-2 ]¢0.14
Appendix
Physical Pammeters (con'dj
Pmwry, Nam,
L —d-
k Axe or
1.16m ss OWg. Nea
T,el Fla,rs FI,m1
Floor2
Floor3
Fl,orq
Floors
1.11
Taul Gmcs FlmrAraa
FAAU, —Mea
dd It or ll,r
FI „r2
FI „r3
Fl6eeq
FIOO
FIOo18
Taid
Nn.—Fk,r Nea C-11
AlliebUSe
IAIie bUSe
MixebUse
MlxebUse
IA lxetl -Ilse
MI..d Use
MN.dU'.
hided! USe
R,lalllftesltlentlal
R,IalVgesltlenllal 0 R,Ia
IVResltlen0,l 0 R,1a111.MIentlal
RnWeA gtlen..l
0.ela lll0.esitlenllal
Reniplesidenual
AchIlReeld.r&I
Piev 6Nd
lire BNJ, 0
61.1 BNE, 0
6M 6Nd
6p Lincoln M,d
6,,.—I. INd
hmml,wn
O,"m m
15.
15,000
15 W0
15.OW
ii, W
16.W0
15.
M.
2],24]
31,55]
2],34]
29.973
R],2q]
35,BFP
4.j.
in 11]
3
B
11378
"el.
113]9
8,822
113]0
11379
1Z..
..led
14,369
IlAid
14,359
9,425
14366
13793
12,969
Min
-
].194
-
0425
-
9,195
13161
11.149
_
11.149
eAld
0,117
27,247
31,55]
27,24]
29.9]3
2],24]
35968
d0,1 d0
B1.tt]
1 i
210
102
200
182
23.
289
4➢]
10,W3
M.
10,.
0,5CO
M.
10,.0]
11.
7.205
12.503
n,.
12,.
0.2W
12.503
12,W3
113W
9.550
"A.
S7W
A.
7.
W
2.1n
26,250
Z.1i
24.900
22500
3enni
51955
026A
0324
626M
011k
4J OX
636A
B].Ob
BS Ob
Pa0e3 41
,10
RR6A..n.I-
6umme� Ne'x Tk1182 ROC VAiH Feen1 /A- 7129114
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42
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42
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43
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43
Appall. 0
Proposed TIFMes Parke Reereallnn and Algorable Housing Linkage Fees
PrOl ,I llama
iuxeaVSe IAxeaLsa
islusResHenlla 0 Relailu -ndmtia 0 Relandsunord.
Lamnw
PIroBXa. 0
Plao Ins.
GIA 91vJ.
LU[E ner
I g
g
I
Land.-
is ado
sead n
9
awg_Arez lsFl
2129]
al$5]
$ 93,350
Pe s!3e nIkI UMa
24
H
15
Ala Mel Rala
M,973
27
y,550
SIWbs
,11]
g
S -
3:R
17
01
Martel kale .I
gR
]
as
5 W.g10
a.
1
2
5 M.
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0
0
10
3R
9
]
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ResNenl'wl(Hel Leasshk SFl
19,59]
23238
19,59
Refa4(Rel Leases. aF)
3.W]
3.WJ
j2f AJ xkasable
Glhq Mal Leae
_
5 (659M)
halal Me ntlek1
$ -
S Bq,OW
5 (w.)
Moe Pa lon W .b net2
q5%
j30.30 xkazablearea S
19,SW
ohm
29,]59
gB4Obl
1955
Ree sal (ones)
-
5
qAb
idad Vrila
j9.)0 xleasable area g
-
$ -
L on
gR
..II, Urtils
III
23R
.w.se
layedus,
lisodLso
kim,lVse
.Nile
IndenR d.sala o
RelalMesl JeNia 0 Hulas Reelusuke
RelaNReslds.111 o
RelsioRwieen.
ell .11. 0
6a Lineoln Rlvd o ..Iknwkn.111.
g-e-,
sead n
9
g
S 3o.3N
o
$ 93,350
15,W1
13.OW
IS.
15
5
M,973
Ri.2sl
y,550
qp,1 L0
,11]
S -
S -
$
17
01
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31
as
5 W.g10
I
I
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5 M.
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0
0
10
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9
]
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10
2
$ -
2
5
kel alb Meal
45%
j2f AJ xkasable
5 165.015)
5 165,859)
3 165,835)
5 (659M)
5 ($$.SYI
$ -
S Bq,OW
5 (w.)
1
q5%
j30.30 xkazablearea S
19,SW
27weL
29,]59
gB4Obl
1955
3.M9
3,Wa
4.W1
qAb
Fee Faelol
III
fIQ
i f14.
319
114
]14�
nF Feed
fI W'0] xkay.:;::5
S 3o.3N
5 M334
$ 93,350
5 3o,J30
g 16.334 5
35,113
S 35,115
Ma Mal BZou al
q5%
Pesos perun It $
-
S
5
S -
S -
$
$ 91WJ
5 1...294
Martel kale .I
SVO, runs S
]S,mJ
5 W.g10
S ]5,441
S 79,oS2
S ]S.WO
5 M.
S -
S -
Mouwble
5e. pe-It S
-
b -
S
S -
$ -
$ -
S -
5
kel alb Meal
45%
j2f AJ xkasable
5 165.015)
5 165,859)
3 165,835)
5 (659M)
5 ($$.SYI
$ -
S Bq,OW
5 (w.)
ket al Areal
q5%
j30.30 xkazablearea S
91.1(0
5 93.$W
3
S fis p35
5 go
S mp3
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S
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-
$ -
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i -
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S -
S -
3
,dH -1earz
j10&J xkasable area S
-
$ -
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3
Note .1.2
$3f xleasable area 5
5 10fi]AO
$
4
S
j
S
S
E
$uhlalal
1 )W
131 .
$ .".
$ 1956.9
1652W
$ e".
$ 111 PU
231.244
Less: Fee on FaisWgRelaA $F Neal
521.9) afeasable area
$ 30p]4p16
f ]O.q]A06
f 39.1 %.11a
f a A96,0o0
f 20,603,1]2
$ Im".11a S
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k able area $
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leue.7.
0.6%
O.6X
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S
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]9144
p opose4ParksMaluelt nFee
35X+Fb .. F.I
se-ones
olaasl Rafe Huse,
25%
OI L's
3-a%
510,554 peruN $
.216
$ N.35
$ 55 ?I6
1 ]0,9N
5 es,uu
$
5 93,$29
3 213.313
2s Bus
25%
I.as peruN 5
46.oi)
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5
E 56,65]
S 40.55]
T.213
$
64435
5 ]0,931
3 1]3,is3
eked" kHouarg
. f+ruN 3
$
5
S
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5
RaisA
25%
55.88 see. .aeea $
5 4.435
$ 4L.e
$
S e'.
$
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omw
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-
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51252 xkassb. I- $
S
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E
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3
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5
ustone ee
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11).363
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f 117,369
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3 402,467
Less Fee an EJSMg Rela 0 5F
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35%
as. vka mb.arza S
=era
(11.31)(
5 (11213)
S (112131
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$ (11,213)
3 (11$13)
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wass,
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$
5
S
$
f
5
5
de"..
1
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f 550331
f 1]40]4
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Proposed Aendende H ... mg linkage Fee
I ll.l.']mum Fws
Page 8010 Surrvne�lkrr inr lax ROC \ATl aectm- pr.a 'an
III
6 scene
kis.0
fI W'0] xkay.:;::5
S 3o.3N
5 M334
$ 93,350
5 3o,J30
g 16.334 5
35,113
S 35,115
uwu
q5%
522411 xleaoe. aeea
5
$
5
S
3
5 g
S
Suololal Fee
3 AIM
$ 2edes
f 26,334
3 All.
f 35,053
$ 3901, S
55.119
f 06,tta
ao
Less Fe nFLStig Rela6 &F
ReUa
45%
$Itd.O]x ka ssMe area
5 165.015)
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3 165,835)
5 (659M)
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135.656)
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S
3
3
S
NN iee
S
5
$
5
f
f 5
5
aFees
5 10fi]AO
3 Sd(691j
f 106.146
f 112.UH
f 108.145
$ 19094] 1 f
1916]9
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I .. PI GSF
S
3
3 190
f 613
f 3.90
$ 611 f
d.]]
f ].II
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$ 30p]4p16
f ]O.q]A06
f 39.1 %.11a
f a A96,0o0
f 20,603,1]2
$ Im".11a S
sl.684.1I3
f 90A06.116
Fee aa% as us"
05%
e.6%
0.4%
011,
0.6%
O.6X
0.9A
1.6X
Page 8010 Surrvne�lkrr inr lax ROC \ATl aectm- pr.a 'an
Appenmx E
NO 0pnlalln9 Income
oblype Name
La mlbn
N P,ea
GmssRFI9. Pees (SF)
Reapn nGal Un9s
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sRtlw
20R
PIIOIaaIXa
RR
R
o,�O ma Lea=3h:a 31�
(Net Lea sshk SF)
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SIWe RnMNni:IAmN
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Un AS lnmmettear
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0
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1
0
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WE.711 $
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59
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101
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Naa: u,xe4nhmieJ opeMwa Expenmi
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51813
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51.613
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53.335
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14.493)
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$ 17.]W $ I.I,. 5 130453 $ 118.G]0 $ IM.OM $ 51240 $
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5 1J,812 $ ]3o]2 $ 24,443 S 1 $ 119]W 5 I1B,]W 5 99,424 5
x EGI S 12x161 S 111181 S 119931 $ 111181 S (1591) 5 0.,.,) E 0.182) $
-
5 -
50NIJ.RV9 -
50% xGnis lrcnme S E
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'In9lMe of fle al ESlale AY nagemenlamuel apmeeiq m9 J bl apaMleM WlNiysN WS MBeIes Ceunly
e PorHRLRm wotm aaM ka Mal leasldtiy ael nl Jere bpmenls Pssumxs VA lskleleL &nlbl eenlx =DS'bx m.mbun; Pry =BSX. Wrmlovm oHVx
mJepaame nl enls as evk'.v INeMUm auppzr Sn:Ixa.HOlel is aswmeJ to beaM6yaN,.nelea xo rvty poaurt
a P¢,CA /a cool wleaWe eM HRM eswmj bns.alN
e Rzwmez SxM'moMM1 le servM 1100 o1w�ly); 5 185 /rta nN Umeurvetl (BSM); alq $SOD'moNM1 aa.Ty uu (s X).
45 Sm� <.Ll1e.,r,,.1R.e5.1,HE«..,G,1<I
1,1018 314,4
$
5
5
S
$
5
1pb EGI $
5
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- $
S
$
- S
59.V! xPalMlrg lrrome S
5
- $
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� 5
$
� $ -
$
.1,11. $ 616,24] $ 60.145 S SSBASI $ 381101] $ ]411A0 5 ] }04199 $ UBS,11S
'In9lMe of fle al ESlale AY nagemenlamuel apmeeiq m9 J bl apaMleM WlNiysN WS MBeIes Ceunly
e PorHRLRm wotm aaM ka Mal leasldtiy ael nl Jere bpmenls Pssumxs VA lskleleL &nlbl eenlx =DS'bx m.mbun; Pry =BSX. Wrmlovm oHVx
mJepaame nl enls as evk'.v INeMUm auppzr Sn:Ixa.HOlel is aswmeJ to beaM6yaN,.nelea xo rvty poaurt
a P¢,CA /a cool wleaWe eM HRM eswmj bns.alN
e Rzwmez SxM'moMM1 le servM 1100 o1w�ly); 5 185 /rta nN Umeurvetl (BSM); alq $SOD'moNM1 aa.Ty uu (s X).
45 Sm� <.Ll1e.,r,,.1R.e5.1,HE«..,G,1<I
1,1018 314,4
Appendi.F
Retnm on CosWeveloper Profit Ra,gln
�Pe, Rail E9ala Reeeaml, COryRaE m031d 0uade1 N13, LOa M9zga Nea JaU
46
Pa9eB 010 hN.,J
on-eJ xe
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ftelalMeSlJeMla
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$ 1.0]6,610
5 1.663.977
Cap gale
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$ 10.535,415
$ 10,4W.20]
5 ID.4M.2B)
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5 II.9Y.132
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5 31,393.340
Nx1.p .RpI—
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(2521)
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$ 125211
5 (4.AVR
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S (1,010)
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Cap Rale
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(1) 569)
$ (BJ.i li)
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$ (04.71] )
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5 (132N1)
5 (ey7I7)
$ (200.541)
Rd O(zlal'ugimmz
Ftom APo.E $
71,655
S 71,050
$ 9J,S1
$ 120,212
$ 110.109
$ 116,109
$ 732216
$ 92210
Cap Rali
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L.A.
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$ 1.41],4)9
$ 1,B21,3M
$ 47FB,II]
$ 1,]5922]
5 3SIn055
5 3.518.455
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llo
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loo
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f 11.516 }95
3 11,]]0.169
f 13.115960
f 1016)4001
$ 11,665.495
f 23]46366
5 )4)05.343
vel., ReNmS
.—I" eb Plot
'
TOw .jR, voA
Fmm abvo S
$057.471
5 11,539,)95
5 I ,80,156
$ 12159.450
5 10531,W1
5 13,h5,�5
$ .,74R.
S 31.]W,293
ees TOlal Devebpm .Coi
Flom Ppp.O 5
10142110
$ no. II]1
S 110412141)
$ (1..70.3,Z12
5 1033115]
$ 1120]0
$ M..5951
$ (30 b99Z11
Pmfil
$
1.115,353
$ L.J.
5 1.3 Rolo
$ 1
,
. ,
275,620
3,.M.,
%o1V4
ll.X
I1.O.
11.0%
11.6-4
71.0-4
Rehm on ToU Ozvebpmo M Cog
65893]
$ 591,013
S ]41,SED
$ I,JW.
5 4855,110
Tolal Oxvebpmenl Cast
Flom A, $
(8,70;118
5 (1....
$ (1),412141
E 110,]93
3 (B 331.9571
S (120)9.14%
5 (:0,93250
5 (30.Om92])
geWmmCeY
6.16-4 p
6.09-4 N
6.1]% p
Z72)
6. IX N
Bi)% p
6.14-4 p
6.31-4 N
6.10%
�Pe, Rail E9ala Reeeaml, COryRaE m031d 0uade1 N13, LOa M9zga Nea JaU
46
Pa9eB 010 hN.,J
UVIYAMM
Sensitivity test for new Downtown mixed -use retail /residential prototype assuming 50%
income units:
1. Residual Land Value Impacts With Fees
2. Return on Cost /Development Profit Margin Impacts With Fees
47
Residual Land Value
Results Summary - Tier l 6 2 Development Prototypes (With Add'I Fees)
Program Summary (sea App. A)
With 60% Income Units
1,222,874
Mixed Use
Mixed Use
Prototype Name
RetdtllResldenflal
RetaiilResidential
Location
Downtown
Downtown
LUCETier
1
2
Permit Requirement
Soft Costs
S
If Parcels
$
1,544,018
Bldg. Height(Feep
39
60
Stoics (0)
3
6
Site Area (SF)
15,000
15,000
Gross Bldg.A.. (SF)
40,140
61,117
Floor Area Ratio(FAR) - Gross Area
2.68
4.07
Floor Area Ratio(FAR) - Net Area
2.25
3.46
Net Leasable Areas
544,438
Other Soft COSts
Residential (SF)
29,750
48,000
Market Rate Units
33
52
Affinf.le Units
4
9
Total Units
37
61
Retail (SF)
4,000
4,000
Oil. (5F)
-
-
Development Costs (see App. B &C &D)
$
1,222,874
S
1784116
Land Costs
see
Residual Value
see
Residual Value
Hard Casts
$
7.833,926
$
18,939,390
Soft Costs
S
986,947
$
1,544,018
Net Parks/Recreation Fee
$
159,132
$
372,163
Net Affordable Housing Linkage Fee
$
-
$
-
TIF Fee
$
-
$
6,808,671
Other Gil, Costs(see App. E)
$
359,499
$
544,438
Other Soft COSts
$
1,145,322
$
2,329,691
Financing Costs
$
868 340
$
1,705.052
Tellel Development Cast
$
10,386,219
$
21,890,934
per GSF
$
$256
$
$358
Net Operating Income (NOI) (see App. E)
860%
6,60%
Residen9al- Ma6ket Rate
$
3,518,455
$
3,518,455
Effective Gress Income
$
1,21],94]
$
1,908,018
Less: Cperating Expenses
$
(231O
5
(364,000)
Net Operating Income
$
986,947
$
1,544,018
Residential- Affordable
$
-
S
-
Effective Gross Income
$
31,709
$
70,880
Less: Operating Expenses
$
(28,000)
$
(63,0
Net Operating Income
$
3,709
$
7,880
Retail
Effective Gross Income
$
239,400
$
239,400
Less: Operating Expenses
$
(7.182
$
(7,182
Net Operating Income
$
232,218
$
232,218
Office
Effective Gross Income
$
-
$
-
Less: Op umfing Expenses
$
$
Net Operating Inwme
$
-
$
-
Total Net Operating Income
$
1,222,874
S
1784116
Project Component Values (see App. F)
ReamentiaFMarket Rate
$
22,210,078
$
32,799,549
NOI
S
986,947
$
1,544,018
Cap Rate
$
5.3%
$
5.3%
Value
$
10,621,642
$
29,132,415
Residential Affordable
$
9,067,599
$
6,808,671
NOI
$
3,709
$
7,880
Cap Rate
5.30%
5.30%
Value
$
69,981
$
148,679
Retail
$
(11)
$
(26)
NOI
$
232,218
$
232,218
Cap Rate
860%
6,60%
Value
$
3,518,455
$
3,518,455
Office
NOI
$
-
$
-
Cap Rate
6.40%
6.40%
Value
$
-
S
-
Total Project Value
$
22210078
$
3279)549
Residual Land Value Estimate
Total Project Value
$
22,210,078
$
32,799,549
Less: Developer Profit
$
(2,776,260)
$
(4,099,944)
Less: Total Development Cost
$
(103662197
$
(21,890,9347
Residual Land Value
Total
$
9,067,599
$
6,808,671
Per SF Land Area
$
605
$
454
Residual Land Value No Fees
$9,230,901
$7,204,595
Change in Residual Land Value
$
(163,302)
$
(395,924)
Per SF Land Area
$
(11)
$
(26)
Percent Change in Residual Land Value
-1.8%
-5.5%
Within Market Range?
Yes
Yes
HR& . Advisers, Inc.
OTTESTSunnier New Tier 182 RLV W41H FeesvInummary
Pa9 ofe 7 -24 -14
RED Results Summary -Tier 1& ] Development Pmtalypes (With Atl81 Fees)
Appendix
Ph,le.1 Pmamatmc
q 9 F RBA Arslwla. ". 4 OrrFrTfiner. unv Tou U2 me. 1- 1hAPlag ®m
loge 2 .16 1.2614
Infilblell.r.m.rentle
.lend me "norms.
,..Dr. Uses
Robeffi esidentlal Re1a111ftesl tle nYal
LowEon
Om,otore oo".-
Pu.Ekra
LUCE Per
Pemvt Reguilemenl
v Rakers
B I6g. Haight {Feel(
le
6O
.-v( /)
3
8
Lana Men (6F)
IS,PoC
15,aW
Cross Burg. no 'I),
90.190
Slur]
Floor ken Pon(FAR)- ter — Meal
2fi0
4,07
Floor Mea Co. (EAR) N.1 N..
225
J96
Net leasable Areas
33,]ad
51855
Rkro -Oals
2).7.
46,000
Rata it
4,030
Ouse
hotel
A Hotel Rowns
-
R.ClumeolUnlLlilt
O1fiw 6F
Rest SF
d..
4 W0
H.WCF
Re silan5at 61 -T.vk
n.'r.
47,955
F... us' (baser on a, unll cao)
37
fi0
sWbio
475
975
,.R (S')
]W
]�
24m pU)
1.
I..
R.er.
11
IB
PER ( ®-non
It
I]
vIUI Den.)
P
17
6ubbUtp orre
3J
52
Apeo ble
PeR m')
6W
60C
,up (m)
1,W0
1'.
1AR(p..)
2
5
.RUk's.)
2
4
sub... DLets)
4
g
Few Unne
37
k
Far "Ing
Res....
Molter peN(wlL m'6 Pe r..u)e
1.W
1m
AROMahls kvp.... unit)
100
1.
Subtotal Spaces ( ®)
54
BB
Retail
SWUtlLOW SF
fi3
SuhtoUl Spaces (/)
1J
13
O
SW,WJSF
fi 3
3 J
Subtotal Slaws(.)
-
-
OI
SWceYO,ockr'n)
075
ft75
SublolalSWwa { ®)
-
-
mSpewa
Numhur
67
g3
Cloys Mea/Space(SF],e,11w
300
3L0
pace (6F)S Ubt
350
350
Poor r,.v
iodl Peekng Ares (CF)
23,950
39.65)
I Cub' ' I evels Pont
I6
23
Speels t -2
6]
99
Spa w ...' shovels 35
Cor.CF n"a., us-.S)
In
10
Perguitlo. povMotl by Fir, plamlng s.N,
hasetl on..or revebpmere
apptssbsrs; emwaing Oovento m5ped5c Plan
lnlonnalon: and IDIO LUCE.
2 Per Ppk%.h— ,I an ne4logmss I ....... ...,Ions me. 111eta0 and 0]%
lot ositleners), antl ne—I.B nor bU I reve per ale s b gross flow. a per
C..' based on wall. 1P on three loo
s on.d on unit Liin antl net Irkne.........
by ..1 ms. pxI City ProsergMRBA.
°Aseemesl0%a1 Per 1 ml 154 olltw 2 en4v
1w50 %i— sonlvuseholds
s ku—se f s spesserstedo ;15C e,..1 -BR
r,t and 20 apaces2 -OR and
q 9 F RBA Arslwla. ". 4 OrrFrTfiner. unv Tou U2 me. 1- 1hAPlag ®m
loge 2 .16 1.2614
A,o.dl. A
Physical Pammeton(con'd(
JO
pogo 3 of
NRG APrinrs, lnn
V r5sr somme,_rve:r rer 1 o Rm uxm F..mvn- Fme� =m
With §A° laSame Unls
Irllre0.Fro
tAI[etlUSe
'.."e N =me
Relalllfles lEenllal
RIUtll.Moontlal
mcaevn
Dn W,m
Guwniown
ery
slb Naa
16,GU
15M
rv1=I Cross RlCg. Nea
a0.i d0
5t II]
TvUl 11—
a
0
Floor
MA.
e,1.
Floor2
'U.
100]]
llr.:3
13,161
11,1 0
Floord
-
I"I'll
Floarro
-
0540
Floer6
0621
I..l Gross FX ,Nea
40140
51,11]
FPRGross Ne=
2b3
40]
Na
Fbo,10
r 11
],205
11,3M
9,550
11..3
F la..4
11d50
9,]W
Fl o d
Fbo,.
ToUI
3].]50
5f 055
NoVGross Floor Nea Overall
9�,0%
650%
JO
pogo 3 of
NRG APrinrs, lnn
V r5sr somme,_rve:r rer 1 o Rm uxm F..mvn- Fme� =m
RLV Results Summary - Tier 1 & 2 Development Prototypes (With Add'I Fees)
Appendix B
Development Costal
t Per HR &A review of market data and financial feasibility peer reviews of recent developments
z 80% x calculated values, per Marshall & Swift Commercial Cost Estimator, 3rd Quarter, 2013;
HR &A Advisors, Inc., to account for certain hard costs and soft costs accounted for separately.
HR&A Advisors, Inc.
DT TEST Summer New Tier 1&2 RLV WITH Fmsvt/B -Dev Costs
PagN of 8 7 -24 -14
With 50% Income Units
Mixed -Use
Mixed -Use
Prototype Name
Retail /Residential
Retail /Residential
Location
Downtown
Downtown
Land Area
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
Net Leasable Areas (SF)
Residential
29,750
48,000
Retail
4,000
4,000
Office
-
-
Hotel
-
-
Hotel Rooms
-
-
Sublerranean Parking (spaces)
67
99
1 -2 Levels
67
99
3 -5 Levels
-
-
Land Cost
see Residual Value
see Residual Value
Hard Cost
Construction Type
V
Illb
Building Construction /GSF2
$126
$210
Demo /On -Site Improvements
$
225,000
$
225,000
Off -Site Improvements
$
100,000
$
100,000
Building Care & Shell
$
5,057,621
$
12,852,875
Retail Tenant Improvements
$
140,000
$
140,000
Office Tenant Improvements
$
-
Hotel FF &E
$
-
$
-
Sublerranean Parking
Surface
# $
- $ -
$
-
1 -2 Levels
f0 $
2,010,000 $ -
$
2,970,000
3 -4 Levels
# $
- $ -
$
-
Contingency
/f $
301,305 $
$
651,515
Subtotal Hard Costs
$
7,833,926
$
16,939,390
Soft Costs
Net Parks /Recreation Fee
$
159,132
$
372,163
Net Affordable Housing Linkage Fee
$
-
$
-
Net TIF Fee
$
-
$
-
Other City Permits & Fees
$
359,499
$
544,438
Misc. Community Benefits Cost
$
-
$
-
A &E /Other Professionals
$
470,036
$
1,016,363
Marketing /Leasing Commissions
Residential
$
223,125
$
360,000
Retail /Office
$
12,000
$
12,000
Legal & Accounting
$
78,339
$
169,394
Taxes & Insurance
$
78,339
$
169,394
Pre - Opening Expenses
$
-
$
-
Developer Fee
$
235,018
$
508,182
Contingency
$
48,465
$
94,558
Subtotal Soft Costs
$
1,663,953
$
3,246,492
Subtotal Hard +Sells Costs
$
9,497,879
$
20,185,882
Financing Costs
Loan Term (months)
Average Loan Balance
Construction Loan Interest Rate
Construction Loan Interest
$
509,324
$
1,082,468
Construction Loan Fees
$
142,468
$
302,788
Capitalized Project Value
Permanent Loan Percent x Value
Permanent Loan Fees
$
216,548
$
319,796
Subtotal Financing Costs
$
868,340
$
1,705,052
Total Development Cost
$
10,366,219
$
21,890,934
per GSF
$
258.25
$
358.18
t Per HR &A review of market data and financial feasibility peer reviews of recent developments
z 80% x calculated values, per Marshall & Swift Commercial Cost Estimator, 3rd Quarter, 2013;
HR &A Advisors, Inc., to account for certain hard costs and soft costs accounted for separately.
HR&A Advisors, Inc.
DT TEST Summer New Tier 1&2 RLV WITH Fmsvt/B -Dev Costs
PagN of 8 7 -24 -14
RLV Results Summary - Tier 1 & 2 Development Prototypes (With Add9 Fees)
Appendix C
Proposed New Fees, Existing City Fees & Permit Costs
HRSA Acids. ,ins.
nTTEST Summer New Tier 182 RLV WITH FeesvlloGly Cost Detail
Pag ofe T -24 -14
With s0i Income Units
Mixed -Use
Mixed -Use
Prototype Name
RelaillResidenfial
Refollmosidendal
Location
Downtown
Dovmloan
Land Area
15,000
15,OOD
Gross Bldg, Area (SF)
40,140
61,117
Residenlial Units
Market Rate
Studios
11
18
i -BR
11
17
2 -BR
11
17
Affordable
i -BR
2
5
2 -BR
2
4
Residential (Net Leasable SF)
29.750
48,000
Relail(Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
-
-
Hotel (Net Leasable SF)
-
-
New Affordable He,. Linkage Fee'
$
-
$
-
New Parks Fee'
It
159,132
$
372,163
TIF Fees'
$
$
Subtotal
$
159,132
$
372,163
Planning Permits'
Development Review
$
-
$
15,568
Development Agreement
$
-
$
-
MultplePermitFee
$
_
$
-
Architectural ReeiewBoard
$
-
$
Coastal Zone Concept Review
$
-
$
-
CEQA
Categorical Exemption
$
14,622
$
14,622
Negative Dart Station
$
-
$
-
EIR
§
$
Subtotal
$
14,622
$
30,190
Other Requirements'
Mitigation Fee on Office Space
$
-
$
-
Recreational Unit Tax
$
-
$
_
Ads Fee
New ReeidendaVCOmm nsiai
$
80,280
$
122,234
Tenant Improvements
$
2,000
$
2,000
Child Care Fee
Market Rate Residential
$
4,405
$
6,941
Retail
$
18,120
$
18,120
Office,
$
-
$
-
Hotel
S
-
$
-
School Facilities Fee
Residential
$
95,200
$
153,600
Comme¢ial
$
2.040
$
2,040
Subtotal
$
2D2,045
$
304,935
Eld0. /Construc6on Permits'
Plan Check
Residential Apartment
$
27,153
$
43,810
Commercial <10K SF
$5,116
$5,116
Commercial > t OK SF14 stories
$
$
-
Mechanical
$737
$727
Electrical
$727
$727
Plumbing
$727
$727
Building Peanitsflnspeclions
Residential Apartment
$
30,452
$
49,133
Commemial lStr'
$
3,113
$
3,113
Commemial 4n stores
$
-
$
-
Tenant improvements <iDKSF
$.
1,396
$
1,396
Tenant improvements>IOKSF
$
-
$
-
GeotechnicalReports
$
$
Subtotal
$
69,411
It
104,749
Utility Feei
Wale, Melef'
$
3,837
$
3,837
[Froure Metter
$
18,195
$
16,195
Wastewater Capital FanliOes
Sludioll-BR Units
$
28,032
$
46,720
2 -BR Units
$
20,241
$
32,697
Commercial
$
3.116
$
3,116
Subtotal
$
73,421
$
104,565
TOTAL
$
518,631
$
916,601
per GSF
$12.92
$15.00
See Appendix D for calculation datails.
' Per new Ordinance No 2420 (COS), adopted March
12, 2013. Assumes
TIF credit
for50 %ofsile also
3 Per City staff /nexus study recommendations. Assumes fee credits for exisling
retail on 50% of site area.
a Per FY 2013 -14 City fee schedules.
s Includes me tar and capita] facllllles charges.
HRSA Acids. ,ins.
nTTEST Summer New Tier 182 RLV WITH FeesvlloGly Cost Detail
Pag ofe T -24 -14
Proposed TIE /New ParkslRecreation and Afforable Housing Linkage Fees
Studios
With 600/6 Income Units
Acaern ions
Mixed -Use
Prototype Name
Romil/Resldential
Mixed -Use Retail /Residential
Location
Downtown
Downtown
LUCE Tier
1
2
Land Area
15,000
15,000
Gross Bldg. Area ISE)
40,140
61,117
Residential Units
37
61
Market Rate
33
52
Studios
11
18
1 -BR
11
17
2 -BR
11
17
Affordable
4
9
1 -BR
2
5
2 -BR
2
4
Residential (Net Leasable SF)
29,750
48,000
Retail (Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
-
'
Hotel (Net Leasable SF)
Market Rate -Area 1
-
Floor Area Attributable to Tier 2
IS
85,800
Office
Market Rate -Area 2
$3,30D
Residential (units)
$
24
Total Units
Affordable
$0.00
Studios
4.5%
Acaern ions
-
7
1 -BR
25%
4.51A
$195.07 xleasable area
$
7
2 -BR
25%
$16,554 per unit
$
91,047
7
Affordable Units
25%
$26,661 per unit
$
73,318
$ 166,498
1 -BR
35,113
$0 per unit
$
-
2
2 -BR
25%
$5.98 xleasable area
$
5,980
1
Assumed E istingRetail Fl rArea
25%
$9.24 xleasable area
$
15000
15000
Fee Factor
i ck
$12.52 xleasable area
$
-
1,141
TIE Fees'
Net Fee
$
170,345
$ 383,376
Market Rate -Area 1
$2,600
per unit
IS
85,800
$ 142,116
Market Rate -Area 2
$3,30D
per unit
$
-
$ -
Affordable
$0.00
per unit
$
-
$ -
Retail Area 1
$21.00
xleasable area
$
84,000
$ 84,000
Retail -Area 2
$30.10
x leasable area
$
-
$ -
Office -Area 1
$9.70
xleasable area
$
-
$ -
OfFlce -Area 2
$10.80
xleasable area
$
-
$ -
Hotel -Area 1 & 2
$3.60
xleasable area
$
-
$ -
Subtotal
$
169,800
$ 226,116
Less: Fee on 50% Existing SF Area 1
$21.00
x leasable area
$
(315,000)
$ (315,000)
Less: Fee on 50% Existing SF Area 2
$30.10
xleasable area
NET TIE Fee
$
Proposed Parks /Recreation Fee
25 %x Maximum Fees
Proposed Affordable Housing Linkage Fee
4.5% x Maximum Fees
4.5%
Acaern ions
Market Rate Housing
25%
4.51A
$195.07 xleasable area
$
35,113
0 -1 BRS
25%
$16,554 per unit
$
91,047
$ 210,898
2+ BRS
25%
$26,661 per unit
$
73,318
$ 166,498
Affordable Housing
35,113
$0 per unit
$
-
$ -
Retail
25%
$5.98 xleasable area
$
5,980
$ 5,960
Office
25%
$9.24 xleasable area
$
-
$ -
Hotel
25%
$12.52 xleasable area
$
-
$ -
Subtotal Fee
Net Fee
$
170,345
$ 383,376
Less: Fee on 50% Existing SF
-
Combined New Fees
y $
Retail
25%
$5.98 xleasable area
$
(11,213)
$ (11,213)
Office
25%
$9.24 xlaasable area
$
-
$ -
Proposed Affordable Housing Linkage Fee
4.5% x Maximum Fees
HRBA Advisers, Inc.
G�1
DT TEST Summer_ New Ter 182 RLV NTH FeesvlfD -Fee Analysis
PagNof 8 7 -24 -14
4.5%
Assumptions
Retail
4.51A
$195.07 xleasable area
$
35,113
$
35,113
off'.
4.5%
$224.11 xleasable area
$
-
$
-
Subtotal Fee
$
35,113
$
35,113
Less: Fee on 50% Existing SF
Retail
4.5%
$195.07 xleasable area
$
(65,836)
$
(65,836)
Office
4.'v%
$224.77 xleasable area
$
-
$
Net Fee
$
$
-
Combined New Fees
y $
159,132
$
372,163:?
Fees Per GSF
$
3.96
$
6.09
Total Development Cost
$
20,584,772
$
30,485,115
Fee as % Dev Cost
0.8%
1.2%
HRBA Advisers, Inc.
G�1
DT TEST Summer_ New Ter 182 RLV NTH FeesvlfD -Fee Analysis
PagNof 8 7 -24 -14
RLV Results Summary - Tier 1 & 2 Development Prototypes (With Add'I Fees)
Appendix E
Net Operating Income
' Institute of Real Estate Management annual operating cost data for apartment buildings in
Los Angeles County
' Per HR&A review of market data and financial feasibility peer reviews of recent developments.
s Per City's rent schedule and HR&A assumptions.
° Assumes $200 /month reserved (10% of supply); $165 1month unreserved (85%); and
$5001month daily use g%)
HRBA Advisors, Inc.
Pag §oA DTTESTSummer_New Tier l&2 RLV WITH Feesvl /E -Net Ops Income
of 8 7 -24 -14
With 50% Income Units
Mixed -Use
Prototype Name
RBtalpResidenthd
Mixed -Use Retail /Residential
Location
Downtown
Downtown
Land Area
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
Residential Units
37
61
Market Rate
33
52
Studio
11
18
1 -BR
11
17
2 -BR
11
17
Affordable
4
9
1 -BR
2
5
2 -BR
2
4
Retail (Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
-
_
Hotel (Net Leasable SF)
Parking Spaces
67
99
Residential
54
86
Retail
13
13
Once
Hotel
_
For -Rent Residential- Market Rate'
Studio RentUnIUMonth
$2,150
$2,150
1 -BR RenVUnit/Month
$3,100
$3,100
2 -BR RenflUmUManih
$4,000
$4,000
Units Income/Year
$
1,221,000
$
1,912,800
Other Income
$
61.050
$
95,640
Gross Income
$
1,282,050
$
2,008,440
Less: Vacancy & Collection LOSS
$
(64,103)
$
(100422)
Effective Gross Income (EGI)
$
1,217,947
$
1,908,018
Less: Operating Expenses (met. reserve)
$
(231,00
$
(364,000
Net Operating Income
$
986,947
$
1,544,018
For -Rent Residential - Affordable (50% income)'
1 -BR RenVUniUMonth
$
648
$
646
2 -BR Rent/UniVMonth
$
729
$
729
Units lncome7Year
$
33,048
$
73,672
Other Income
$
330
$
739
Oros. income
$
33,378
$
74,611
Less: Vacancy & Collection Loss
$
(1669)
$
(3731)
Effective Gross Income (EGI)
$
31,709
$
70,680
Less: Operating Expenses (Inc. reserve)'
$
(28,000)
$
(63000)
Net Operating Income
$
3,709
$
7,880
Retail'
Average Rent/SF /Month (NNN)
$
5.25
$
5.25
Gross Rental lncome/Year
$
252,000
$
252,000
Less: Vacancy & Collection Loss
$
(12.600
$
(12,600)
Effective Gross Income (EGI)
$
239,400
$
239,400
Less: Unreimbursed Operating Expenses
$
(7,182)
$
(7182)
Net Operating Income
$
232,218
$
232,218
Office'
Average RenVSF /Month (NNN)
$
-
$
_
Gross Rental l mume/Year
$
-
$
_
Parking Incom of
$
-
$
_
Less: Vacancy & Collection Loss
$
$
Effective Gross Income (EGI)
$
-
$
_
Less: Unreimbursed Operating Expenses
$
-
$
_
Less: Parking Expense
$
$
Net Operating Income
$
_
$
_
Total Net Operating Income
$
1,222,874
$
1,784,116
' Institute of Real Estate Management annual operating cost data for apartment buildings in
Los Angeles County
' Per HR&A review of market data and financial feasibility peer reviews of recent developments.
s Per City's rent schedule and HR&A assumptions.
° Assumes $200 /month reserved (10% of supply); $165 1month unreserved (85%); and
$5001month daily use g%)
HRBA Advisors, Inc.
Pag §oA DTTESTSummer_New Tier l&2 RLV WITH Feesvl /E -Net Ops Income
of 8 7 -24 -14
RLV Results Summary - Tier 1 & 2 Development Prototypes (With Add'I Fees
Appendix F
Residual Land Values
Project Value
Residential- Market Rate
Net Operating Income
With 50% Income Units
986,947
Mixed -Use
Mixed -Use
Prototype Name
Retail /Residential
Retail /Residential
Location
Downtown
Downtown
Land Area
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
Residential Units
Market Rate
$
3,709
Studio
11
18
1 -BR
11
17
2 -BR
11
17
Affordable
$
148,679
1 -BR
2
5
2-BR
2
4
Retail (Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
-
-
Hotel (Net Leasable SF)
Project Value
Residential- Market Rate
Net Operating Income
$
986,947
$
1,544,018
Cap Rate'
$
(2,776,260)
$
(4,099,944)
Value
$
18,621,642
$
29,132,415
Residential-Affordable
Net Operating Income
$
3,709
$
7,880
Cap Rate
$
605
$
454
Value
$
69,981
$
148,679
Retail
Net Operating Income
$
232,218
$
232,218
Cap Rate
Value
$
3,518,455
$
3,518,455
Office
Net Operating Income
$
-
$
-
Cap Rate
Value
$
-
$
-
Total Project Value
$
22,210,078
$
32,799,549
Residual Land Value Estimate
Total Project Value
$
22,210,078
$
32,799,549
Less: Developer ProfiC
$
(2,776,260)
$
(4,099,944)
Less: Total Development Cost
$
(10,366,219)
$
(21,890,934)
Residual Land Value
Total
$
9,067,599
$
6,808,671
Per SF Land Area
$
605
$
454
1 Per Real Estate Research Corp., Real Estate Report, 3rd Quarter 2013,
Los Angeles Area data.
2 10 -15% typical, per HR &A.
HR &A Advisors, Inc.
DT TEST Summer New Tier 1 &2 RLV WITH Feesvl /F- Residual Values
PagE05 of 8 7 -24 -14
Return on Cos0Oeveloprr PreFf Margin
Results Summary - Tier 18 2 Development Prototypes (With 4dd7 Fees)
Program Summary (see App. A)
Development Costs (see App. B&C&D)
With 50%
Income Units
$
Mixed -Use
Mixed -Use
Prololype Name
RataillResidentlal
RetailResldenlial
Location
Dovmlmvn
Downtown
LUCE Tier
1
2
Permit Requirement
$
986,947
Is Parcels
1,544,018
Net ParkslRecreation Fee
Bldg. Height (Feet)
39
60
Stores EB
3
6
Site Area (SF)
15,0D0
15,000
Gross Bldg. Area (SP)
40,140
61,117
Floor Ama Ratio(FAR) - Gross Area
2.66
4.07
Floor Area Ratio(FAR) - Net Area
2.25
3.46
Net Leasable Areas
Other Soft Costs
$
Residential ISE)
29,750
48,00
Market Rate Units
33
52
Affordable Units
4
9
Total Units
37
61
Retall(SET
4,000
4,000
Olfice(SF)
_
.
Development Costs (see App. B&C&D)
$
1,222,874
$
1,784.116
Land Costs
$
9,230,901
$
7,204,595
Hard Costs
IS
7,833,926
$
16,939,390
Son COSts
$
986,947
It
1,544,018
Net ParkslRecreation Fee
It
159,132
It
330,095
Net Affordable Housing Linkage Fee
$
-
It
29,132,415
TIF Fee
$
H.]%
$
114°%
Other City Costs (see App. E)
$
3]0,26]
$
560,006
Other Soft Costs
$
1,145,645
$
2,329,336
Financing Costs
$
669,101
$
1.]03]44
Total Development Cost
$
19,608,972
$
29,075,166
par GSF
$
$489
$
$476
Net Operating Income (NOI) (see App. El
$
6.60%
$
6.600
Residential - Markel R.I.
$
3,518,455
$
3,518,455
Effective Gross lncome
$
1,21],94]
$
1,908,016
Less: Operating Expenses
$
(231 0007
$
1364 000)
Net Operating Income
$
986,947
$
1,544,018
Residentlal- Aftomable
-
5
-
Effective Gmss lncome
$
31,709
$
70,880
Less: Operating Expenses
$
(28,000
$
(63,000
Net Operating income
$
3,709
$
7,880
Retail
Effective Gross Inwme
$
239,400
$
239,400
Less: Operating Expenses
$
o,182
$
(7182)
Net Operating Income
$
232,218
$
232,218
Office
Effective Gross Income
$
_
$
.
Less: Operating Expenses
$
$
Net Operating Inc...
$
-
$
-
Total Net Operating Income
$
1,222,874
$
1,784.116
Project Component Values (see A,,. F)
Residential - Market Rate
Not
$
986,947
It
1,544,018
Cep Rate
$
5.30%
$
5.30%
Value
$
18,621.642
$
29,132,415
Residential- Affomable
H.]%
114°%
NOI
$
3,709
$
7,860
Cap Rate
5.30%
5.30%
Value
It
69,981
$
148,679
Relail
Not
$
232,218
$
232,218
Cap Rate
$
6.60%
$
6.600
Value
$
3,518,455
$
3,518,455
Office
629%
6.22%
Not
$
-
$
-0.08%
Gap Rata
6.40%
6.40%
Value
-
5
-
Total Protect Value
$
22,210,078
$
32,799.549
Developer Returns
Developer Profit
Total Project Value
$
22,210,078
$
32,799,549
Less: Total Development Cost
$
(19 6089]21
$
(29,076,16
Profit
$
2,601,106
$
3,724,383
%of Vat ue
H.]%
114°%
Profit No Fees
$
2,]]6,260
$
4,096,518
Change in Profit
£.3%
-9.1%
Feasible?
yes
You
Return on Twsf Development Cost
NOI
$
1,222,874
$
1,784,116
Total Development Cast
$
(19,608,972)
$
(29,075,166)
Return on Cast
6.24%
614%
Return on Cost No Fees
629%
6.22%
Change in Return on Cost
-0.06%
-0.08%
Feasible? Yes Marginal
HRBAAdrisoq le,
fj OT TEST Summer Nevi Tier 182 ROC WITH FeesvI /Summary
Page ofe ] -24 -14
AppendixA
PM1Ysical Pa Mters
0
lln AA.—. NC.
UT TEST S-nen eUJla 71,192 RCC N9 TH FeesvllNRaglam
page 2 o1 3 73b10
Vi ',Int, Como VnUU
rmxm.9¢e rn.I.-
Peofolypo Name
flelalllRe sltlenllai RvNitiResidenllal
Wcafion
Uonnbvm Dovmbvm
LUCENea
LVCETIez
1 2
Petmil Regaimment
/Pa 1.
filtlg. HelgIn (Fee l)
39
6g
SNnes (/)
3
6
Land Nea (6F)
15. W]
15,060
o ss3ldg...(.)-
<U1.
61,117
Floor Nea R,w(FAR)Gloss Are al
263
907
FleerAma Ratia (FAR FNeI Nea
225
396
NR Leaabb Neas (6 FJz
33.]F9
Re9tle n5ala
29.](A
'It..
98,0.9
fteh6
9.W0
dOW
OR
obl
lNalelROOms
Resitlenllal Unit flit
Offi� SF
R.W
Re., SF
4,ON'
9.-
F
flesldsn4 al 6F -Ta lg of
Re,,f&
29,]rA
1],955
EsEmala Un16 (besed on evg. unN UZO)
3]
60
Garkel Rala
bUC
9]5
915
I ESF)
] 00
] 00
S
2 -0R I6 F)
I.W
SNdia
1 I
l a 3
1.RR (ff vnib)
L1
1]
z UR(ro oust
it
17
6 ubbN1 ( /uNls)
33
52
Attoedablea
IARISFI
600
6�
2RR(6 F)
1,000
1.W
IER( /-nib)
2
U 5
D9R (1-11)
2
9
S- blahl( / urvb)
9
0
Tobl UnNa
3]
61
PaeXing
Re5tle n0al
rla
160
199
.Re U, I, Iwrunil)s
O..,S(av9. per unN)
1.00
100
S
SubloUl spaus(Y)
51
BB
TiMl
Spawall,WJ SF
33
33
Sublobl Spaws(!)
13
13
OI!
Spaceslt ON SF
33
33
SuhloNl Spaces (/)
-
-
oll
S.W.1SosYROOm
0]5
075
6ubNYel spans( /)
-
-
us
N-mb r
6]
Unt
AlealSpaw (SF }6I.
300
3N
Gloss ace(6F)C -bL
tno.
350
359
.,W.3
iobl Pazpng Area (SF)
2JAW
39,659
re
/SUbL Levels TObl
L9
23
Spaw�Jl I -2
6]
99
Spaw1-1,t eveb 35
-
-
COnsWChan PedaE(nioalbs)
1B
13
Per gultlanceT pavlded by RN 11—imn sNN. ba ud on lewnt devd,onl
zpplicaEOns :n-ni ing PonnNVin bped(<
Plan and A 19 LUC E.
a PerHRBAhasedonnet9eglo ss fioorarea
sss-mpi— (U0%brmbll end 37%
(Orlorresltlxn4aH,antl tnn,.tion of Nlal grass
llo er area to gross Pool area
per- Pool,ns On stoat vt 11 t-11. lheee
pool¢.
aP nt lataor
entl nelIl
lly PlanningMPBA.
area by-n63%
is
o Ass -roes 10% If iierl entl 151, Tler2-niRNr
—niss 10%If
50% Inwmeho-sobold¢.
me
s Assumes I OspaualsNtlio� 15 ¢paw •II.BR
uniC and 20 slaw. BR uNt
0
lln AA.—. NC.
UT TEST S-nen eUJla 71,192 RCC N9 TH FeesvllNRaglam
page 2 o1 3 73b10
Appendix
r hpleal Parameters (ceti d)
58
Poa53.1.
.I- A"- -lao.
0T TEST Sammer xemner i 82 xOC 1M Tx T5.5vvA.vraOram
72 14
mm env. Isom.
lm e
..od..,.
Aliea.us.
Pre.1yp. Fame
R.do'..amenllol
aetolnrsosmendal
Lo.aeon
.—lmm
oo .,x
G '.- He., Nee ey El.
S ite Plea
IS'.
15.OW
I.IGro55 BIdp. Mee
40,140
id "ll
Total Floors
3
6
Floorl
1YAW
8,180
Floorl
12,9A9
10,9])
F.,S
13,161
11.149
Floor
-
11.1IS
Floor5
-
0.540
To orb
8621
Tool Gmss Fl-, N.a
40,140
61.117
Forbes 5Area
2.69
4n2
F.l Floor Area Fv B o
Floor
11,CW
7,205
Floor
11.3.
%1.
Floor
T 1 'A
9103
Toor4
-
USE
Floor5
Fl ... S
I..
ToUI
33,150
51955
NeVGmss Floor Nea Overall
90.0°/h
B50%
58
Poa53.1.
.I- A"- -lao.
0T TEST Sammer xemner i 82 xOC 1M Tx T5.5vvA.vraOram
72 14
Appendix 6
Development Costs'
With 50% Income Units
Mixed -Use
Mixed
-Use
Prototype Name
Retail /Residential
RetaillResidentlal
Location
Downtown
Downtown
Land Area
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
Net Leasable Areas (SF)
Residential
29,750
48,000
Retail
4,000
4,000
Office
-
-
Hotel
-
-
Holel Rooms
-
-
Subterranean Parking (spaces)
67
99
1 -2 Levels
67
99
3 -5 Levels
-
-
Land Cost
$
9,230,901
$
7,204,595
Hard Cost
Construction Type
V
illb
Building Construction /GSFz
$126
$210
Demo /On -Site Improvements
$
225,000
$
225,000
Off -Site Improvements
$
100,000
$
100,000
Building Core & Shell
$
5,057,621
$
12,852,875
Retail Tenant Improvements
$
140,000
$
140,000
Office Tenant Improvements
$
-
Hotel FF &E
$
-
$
-
Subterranean Parking
Surface
$
-
$
-
1 -2 Levels
$
2,010,000
$
2,970,000
3 -4 Levels
$
-
$
-
Contingency
$
301,305
$
651,515
Subtotal Hard Casts
$
7,833,926
$
16,939,390
Soft Costs
Net Parks /Recreation Fee
11 $
159,132
$
338,095
Net Affordable Housing Linkage Fee
# $
-
$
-
Net TIFFee
# $
-
$
-
Other City Permits & Fees
It $
370,267
$
560,006
Misc. Community Benefits Cost
$
-
$
-
A &E /Other Professionals
$
470,036
$
1,016,363
Marketing /Leasing Commissions
Residential
$
223,125
$
360,000
Retail /Office
$
12,000
$
12,000
Legal & Accounting
$
78,339
$
169,394
Taxes & Insurance
$
78,339
$
169,394
Pre- Opening Expenses
$
-
$
-
Developer Fee
$
235,018
$
508,182
Contingency
$
48,788
$
94,003
Subtotal Soft Costs
$
1,675,044
$
3,227,437
Subtotal Hard + Softs Costs
$
9,508,970
$
20,166,827
Financing Costs
Loan Term (months)
Average Loan Balance
Construction Loan Interest Rate
Construction Loan Interest
$
509,918
$
1,081,446
Construction Loan Fees
$
142,635
$
302,502
Capitalized Project Value
Permanent Loan Percent x Value
Permanent Loan Fees
# $
216,548
$- $
319,796
Subtotal Financing Costs
$
869,101
$
1,703,744
Total Development Cost
# $
19,608,972
$- $
29,075,166
per GSF
$
488.52
$
475.73
' Per HR &A review of market data and financial
feasibility peer reviews of recent developments.
2 80% x calculated values, per Marshall & Swift Commercial Cost Estimator, 3rd Quarter, 2013;
HR &A Advisors, Inc., to account for certain
hard costs and soft costs accounted for separately.
HR&A Advisors, Inc.
pp
DTTESTSummer_New Tier 1&2 ROC WITH Feesvl /B -Dev Costs
Pag6 4'of 8
7 -24 -14
Appendix C
Proposed New Fees, Existing City Fees & Permit Costs
Pmlotype Name
Location
Land Area
Gross Bldg. Area (SF)
Residen0al Units
Markel Rate
Studios
1 -BR
2 -BR
Affordable
1 -BR
2 -BR
Residential (Net Leasable SF)
Retail (Net Leasable SF)
Office (Not Leasable SF)
Hotel (Net Leasable SF)
New Atfordable Hog. Linkage Fee'
New Parks Fee'
TIF Fees'
Planning Permits'
Development Review
Development Agreement
Multiple Permit Fee
ArehitecWal Review Board
Coastal Zone Concept Review
CEOA
Categorical Exemptwo
Negative Declaration
EIR
Subtotal
Other Requtrements'
Mitigation Fee on Office Space
Recreational Unit Tax
Arts Fee
New ResidenliallCOmmealal
Tenant Improvements
Child Care Fee
Markel Rate Residential
Retail
Once
Hotel
School Facilities Fee
Residential
Commercial
Subtotal
With 50% Income Units
Mixed -Use Mixed -Use
RetaillResidential RetaillReeidenlial
Downtown Downtown
15,000 15,000
40,140 61,117
11 18
11 17
11 1]
2 5
2 4
29,750 48,000
4,000 4,000
$
5
$ 159,132
$ 338,095
Plan Check
$
$ 15,568
$
$
$ 1684
$ 1,684
$ 1,684
$ 1,664
$5,116
$5,116
5 14,622
$ 14,622
$
$
$
$
$ 17,990
It 33,558
$
$
$ 7,40D
$ 12,200
$ 80,280
$ 122,234
$ 2,009
$ 2,000
$ 4,405
$ 8,941
$ 18,120
$ 18,120
$
$
30,452
$ 49,133
$ 95,200
$ 153,60D
$ 2.040
$ 2,040
$ 209,445
$ 317,135
BIdg.IConstruollon Permits'
Plan Check
Residential Apartment
$
27,153
$ 43,810
Commemisl <10K SF
$5,116
$5,116
Commercial >10K SF14 stores
$
-
$ -
Mechanical
$727
$727
Electrical
$727
$727
Plumbing
$727
$727
Building Pemdisllns,xi ions
Residential Apartment
$
30,452
$ 49,133
Commercial "to,
$
3,113
$ 3,113
Commemisl 4. stories
$
-
$ -
Tenant improvemems <10K SF
$
1.396
$ 1,396
Tenant Improvements >10K SF
$
-
$ -
GeotechnicalReports
$
$
Subtotal
It
69,411
$ 104,749
Utility Fees
Water-Me(ers
$
3,837
$ 3,837
Finales Meters
$
18,195
$ 18,195
Wastewater Capital Facilities
StNeli -BR Units
$
28,032
$ 46,720
2 -BR Units
$
20,241
$ 32,697
Commercial
$
3.116
$ 3,116
Subtotal
$
73,421
$ 104,565
TOTAL
$
3]0,26]
$ 560,006
per GSF
$9.22
$9L6
' See Appendix D for calculation tletails.
e Pernew
lured. atloptetl Mamh
12, 2013. Assumes
TIF cretli(
retail on 5 % f si
for existing retail on 50% of site area.
s Per City stafflnexus study recommendation. Assumes
fee credits
for existing
retail oa 50% mat. area.
4 Per FY 2013 -14 City fee schedules.
a Includes meter and capital facilities charges.
HREAAdviwo, h o.
6 ITT TEST Summer New Tler Ib2 ROC NTH FeervllGGty Cost Oelsl
Page of8 7 -24 -14
Appendix D
Proposed TIF /New Parks /Recreation and Afforable Housing Linkage Fees
Studios
With 50% Income Units
Mixed -Use
Mixed -Use
Prototype Name
Retail /Residential
Retail /Residential
Location
Downtown
Downtown
LUCE Tier
1
2
Land Area
15,OOD
15,000
Gross Bldg. Area (SF)
40,140
61,117
Residential Units
37
61
Markel Rate
33
52
Studios
11
18
1 -BR
11
17
2 -BR
11
17
Affordable
4
9
1 -BR
2
5
2 -BR
2
4
Residential (Net Leasable SF)
29,750
48,000
Retail (Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
-
-
Hotel(NetLeasableSF)
-
4 1.141
Floor Area Attributable to Tier 2
Office
-
Residential (units)
Market Rate -Area 1
24
Total Units
per unit
$
Studios
5
1 -BR
5
2 -BR
5
Affordable Units
1 -BR
5
2 -BR
-
4
Assumed Existing Retail Floor Area
15.000
15000
Fee Factor
1.141
4 1.141
TIF Fees'
Market Rate -Area 1
$2,600
per unit
$
85,800
$ 142,116
Market Rate -Area 2
$3,300
per unit
$
-
$ -
Affordable
$0.00
per unit
$
-
$ -
Retail -Area 1
$21.00
xleasable area
$
84,000
$ 84,000
Retail -Area 2
$30.10
xleasable area
$
-
$ -
Office -Area 1
$9.70
xleasable area
$
-
$ -
Offce -Area 2
$10.80
xleasable area
$
-
$ -
Hotel -Area 1 & 2
$3.60
xleasable area
$
$
Subtotal
$
169,800
$ 226,116
Less: Fee on Existing SF Area 1
$21.00
x leasable area
$
(315,00D)
$ (315,000)
Less: Fee on Existing SF Area 2
$30.10
xleasable area
NET TIF Fee
$
$
Proposed Parks /Recreation Fee
26 %x Maximum Fees
Assumptions
Market Rate Hamadan
25%
41 BRS
25%
$16,554
per unit
$
91,047
$ 192,026
2 +BRS
25%
$26,661
perunit
$
73,310
$ 151,301
Affordable Housing
$0
per unit
$
-
$ -
Retail
25%
$5.98
xleasable area
$
5,980
$ 5,980
Office
25%
$9.24
x leasable area
$
-
$ -
Hotel
25%
$12.52
x leasable area
$
$
Subtotal Fee
$
170,345
$ 349,300
Less: Fee on Existing SF
Retail
25%
$5.98
xleasable area
$
(11,213)
$ (11,213)
Office
25%
$9.24
xleasable area
$
$
Net Fee
$
169,132
$ 330,095
Proposed Affordable Housing
Linkage
Fee
4.5 %xMaximum Fees
4.5%
Assumptions
Retail
4.5%
$195.07
xleasable area
$
35,113
$ 35,113
Office
4.5%
$224.11
xleasable area
$
-
$ -
Subtotal Fee
$
35,113
$ 35,113
Less: Fee on Existing SF
Retail
4.5%
$195.07
xleasable area
$
(65,836)
$ (65,836)
Combined New Fees J$ 159,132 $ 338,0951
Fees Per GSF $ 3.96 $ 5.53
Total Development Cost $ 20,584,772 $ 30,485,115
Fee as %Dev Cost 0.8% 1.1%
HR&A Advisors, Inc.
Pag §qq DT TEST Summer New Tier 1&2 ROC WITH Feesvt /D -Fee Analysis
B of 8 7 -24 -14
Appendix E
Net Operating Income
Prototype Name
Location
Land Area
Gross Bldg. Area (SF)
Residential Units
Market Rate
Studio
i -BR
2 -BR
Affordable
1 -BR
2 -BR
Retail (Net Leasable SF)
Office (Net Leasable SF)
Hotel (Net Leasable SF)
Parking Spaces
Residential
Retail
Office
Hotel
For -Rent Residential- Market Rate'
Studio Reni/UnIUMon81
1 -BR Rent/Unit/Month
2 -BR Rent/Unit/Month
Units Income/Year
Other Income
Gross Income
Less: Vacancy & Collection Loss
Effective Gross Income (EGI)
Less: Operating Expenses (Intl. reserve)'
Net Operating Income
For -Rent Residential - Affordable (50% income)°
1 -BR RenWniVMonth
2 -BR RenWniVMonth
Units Income /Year
Other Income
Gross Income
Less: Vacancy & Collection Loss
Effective Gross Income (EGI)
Less: Operating Expenses (Inc, reserve)'
Net Operating Income
Retail'
Average Reni/SF /Month (NNN)
Gross Rental income/Year
Less: Vacancy & Collection Loss
Effective Gross Income (EGI)
Less: Unreimbursed Operating Expenses
Net Operating Income
Office'
Average RenUSF /Month (NNN)
Gross Rental IncomeNear
Parking Income4
Less: Vacancy & Collection Loss
Effective Gross Income (EGI)
Less: Unreimbursed Operating Expenses
Less: Parking Expense
Net Operating Income
Total Net Operating Income
With 50% Income Units
Mixed-Us.
Mixed -Use
Retail /Residential
Retail /Residential
Downtown
Downtown
15,000
15,000
40,140
61,117
37
61
33
52
11
16
1
17
1
17
4
9
2
5
2
4
4,080
4,000
67 99
54 86
13 13
$2,150
$
$2,150
$3,100
$
$3,100
$4,000
$
$4,000
$ 1,221,000
$
1,912,800
$ 61,050
$
95,640
$ 1,282,050
$
2,008,440
$ (64103)
$
(100422)
$ 1,217,947
$
1,908,018
$ (231,000)
$
(364,000
$ 986,947
$
1,544,018
$ 648
$
648
$ 729
$
729
$ 33,048
$
73,872
$ 330
$
739
$ 33,378
$
74,611
$ (1,66
$
(3,731)
$ 31,709
$
70,880
$ (28,000)
$
(63,000
$ 3,709
$
7,880
$ 5.25
$
5.25
$ 252,000
$
252,000
$ (12,60
$
(12,600)
$ 239,400
$
239,400
$ (7,182)
$
(7,182)
$ 232,218
$
232,218
$ $
1,222,874 $ 1,784,116
' Institute of Real Estate Management annual operating cost data for apartment
buildings in Los Angeles County
x Per HR &A review of market data and financial feasibility peer reviews of
recent developments.
Per City's rent schedule and HR&A assumptions.
4 Assumes $200 1month reserved (10% of supply); $1651month unreserved
(85%); and $500 /month daily use (5 %).
HR&A Advisors, Inc.
g DT TEST Summer New Tier 182 ROC WTH FeesvI IE -Nat Ops Income
PagU ?of 8 7 -24 -14
Appendix F
Return on Cost/Developer Profit Margin
Office (Net Leasable SF)
Project Value
With 50% Income Units
Mixed -Use
Mixed -Use
Prototype Name
Retail/Residential
Retail/Residential
Location
Downtown
Downtown
Land Area
15,000
15,000
Gross Bldg. Area (SF)
40,140
61,117
Residential Units
Market Rate
$
18,621,642
Studio
11
18
1 -BR
11
17
2 -BR
11
17
Affordable
$
7,880
1 -BR
2
5
2 -BR
2
4
Retail (Net Leasable SF)
4,000
4,000
Office (Net Leasable SF)
Project Value
Residential- Market Rate
Net Operating Income
$
986,947
$
1,544,018
Cap Rate'
Value
$
18,621,642
$
29,132,415
Residential-Affordable
Net Operating Income
$
3,709
$
7,880
Cap Rate'
Value
$
69,981
$
148,679
Retail
Net Operating Income
$
232,218
$
232,218
Cap Rate'
Value
$
3,518,455
$
3,518,455
Office
Net Operating Income
$
-
$
-
Cap Rate'
Value
$
$
Hotel
Net Operating Income
$
Cap Rate'
Value
$
_
$
_
Total Project Value
$
22,210,078
$
32,799,549
Developer Returns
Developer Profit
Total Project Value
$
22,210,078
$
32,799,549
Less: Total Development Cost
$
(19,608,972
$
(29,075,166)
Profit
$
2,601,106
$
3,724,383
% of Value
11.7%
11.4%
Return on Total Development Cost
NOI $ 1,222,874 $ 1,784,116
Total Development Cost $ (19,608,972) $ (29,075,166)
Return on Cost 6.24% 6.14%
' Per Real Estate Research Corp., Real Estate Renort, 3rd Quarter 2013,
Los Angeles Area data.
HR &AAdvisors, Inc.
DT TEST Summer New Tier 1 &2 ROC WITH Feesv1lF- Return on Cost
PagO of 8 7 -24 -14
City Council Meeting: September 23, 2014 Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA ADDING CHAPTER 9.74 TO THE SANTA MONICA MUNICIPAL
CODE ESTABLISHING THE AFFORDABLE HOUSING COMMERCIAL LINKAGE FEE
PROGRAM, THE AFFORDABLE HOUSING COMMERCIAL LINKAGE FEE, AND
ESTABLISHING AN ADJUSTMENT AND WAIVER PROVISION
WHEREAS, new commercial development (creative office space, hotel, retail and
entertainment, medical, industrial /light manufacturing, institutional, and hospitals)
creates a variety of new jobs with varied degrees of compensation for workers in
commercial developments; and
WHEREAS, the addition of new workers in these new commercial developments
generates housing demands for households at extremely low, very low, low, and
moderate incomes; and
WHEREAS, due to housing and market conditions, new market -rate
development projects in the City have provided a disproportionate quantity of housing
units that are not affordable to all income groups creating an unbalanced housing stock;
and
1
WHEREAS, funds for construction, expansion or improvement of affordable
housing, including Federal and State housing finance and subsidy programs, are not
available to accommodate the needs caused by development projects which will
promote an inadequate supply of affordable housing stock within the City; and
WHEREAS, there is a low vacancy rate for housing affordable to persons of
extremely low, very low, low, and moderate income households; and
WHEREAS, Los Angeles County is the least affordable real estate market in the
country; and
WHEREAS, the City's existing rental housing stock is quickly becoming
unaffordable to very low and low income households; and
WHEREAS, due to the Costa - Hawkins Act, 63.3% of the controlled rental units
for which the Santa Monica Rent Control Board has registered rents have rented at
market rates; and
WHEREAS, since 1999, the median monthly rents for these units have increased
from $800 to $1,250 for studio /efficiency units, from $1000 to $1900 for one - bedroom
units, from $1400 to $2525 for two - bedroom units and from $1800 to $3201 for three or
more bedroom units; and
WHEREAS, due to these factors, workers of very low, low, and moderate income
are experiencing increasing difficulty in locating and maintaining adequate, safe, and
sanitary affordable housing within the City or even near the City; and
E
WHEREAS, the failure to provide adequate affordable housing for lower -wage
workers can force these workers to live in less than adequate housing within the City,
pay a significantly disproportionate share of their incomes to live in adequate housing
within the City, or commute ever - increasing distances to their jobs from housing located
outside the City; and
WHEREAS, the lack of affordable housing has detrimental impacts on traffic,
transit, and related air quality impacts and the demands placed on the regional
transportation infrastructure; and
WHEREAS, commercial uses in the City benefit from the availability of housing
close to their employees; and
WHEREAS, a Commercial (Non - Residential) Nexus Study & Linkage Fee
Analysis was prepared by Rosenow Spevacek Group, Inc. in July 2013 to analyze the
relationship between commercial development, job creation, and the demand for
affordable housing ( "Nexus Study'); and
WHEREAS, the Nexus Study demonstrates the reasonable relationship between
the purpose of the affordable housing fee, the fee amount, the revenue generated, and
the impacts of commercial development that the proposed use of that revenue is
intended to address; and
WHEREAS, more specifically, the Nexus Study documents the linkage between
new and expanded commercial development, the net number of new employees and
3
employee households generated by businesses occupying these land use buildings,
and the housing demands of these households; and
WHEREAS; as detailed, new housing affordable to persons identified in the
Nexus Study is not now being added to the supply in sufficient quantity to meet the
needs of the new employee households associated with new or expanded commercial
development; and
WHEREAS, the Nexus Study quantifies the cost mitigation associated with
developing affordable housing units based on the identified need resulting from
employees generated by new commercial development; and
WHEREAS, the City Council is imposing the fee established by this Ordinance in
order to partially close the this gap by using the fee to provide for increased affordable
housing; and
WHEREAS, the Santa Monica Municipal Code does not currently establish an
adequate mechanism to account for the impact that commercial development has on
increasing the need for affordable housing; and
WHEREAS, requiring commercial developers to assist in the production of
affordable housing is also consistent with the City's long- standing commitment to
achieve and maintain a suitable living environment including decent housing for all
economic levels; and
S
WHEREAS, this municipal commitment conforms with State and Federal policies
and is an important goal of the City's current Housing Element and its Consolidated
Plan; and
WHEREAS, Objective 2.0 of the City's 2013 -2021 Housing Element provides
that the City should develop new affordable housing financial programs, in part, through
the adoption of new local impact fees, including commercial development impact fees,
based on the recommendations of appropriate nexus studies; and
WHEREAS, this program will benefit the City as a whole since each development
which contributes to affordable housing through the payment of this fee assists in
augmenting the City's housing mix, helps to increase the supply of housing for all
economic segments of the community, and addresses the affordable housing need
generated by the development, thereby supporting a balanced community which is
beneficial to the public health, safety, and welfare of the City.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Santa Monica Municipal Code Chapter 9.74 is hereby added to the
Santa Monica Municipal Code to read as follows:
N".
Chapter 9.74
Affordable Housing Commercial Linkage Fee Program
9.74.010 Purpose and Findings.
(a) The purpose of this Chapter is to facilitate the development
and availability of housinq affordable to a broad range of households with
varying income levels within the City. As detailed in the findings supporting
the ordinance codified in this Chapter, the requirements of this Chapter
are based on a number of factors including but not limited to the City's
long - standing commitment to economic diversity; the serious need for
affordable housing as reflected in local State, and Federal housing
regulations and policies; the demand for affordable housing created by
commercial development: and the impact that the lack of affordable
housing production has on the health safety, and welfare of the City's
residents including its impacts on traffic transit and related air quality
impacts and the demands placed on the regional transportation
infrastructure Imposing a fee that is reasonably related to the burdens
created by new commercial development on the City's need for affordable
housing will enable the City to fund development of affordable housing
units that will contribute to addressing these impacts and fulfilling these
goals
(b) The City has prepared a Commercial Nexus Study and
Linkage Fee Analysis It shows and the City Council finds that there is a
reasonable relationship between the purpose for which the fees
established by this Ordinance are to be used and the type of development
0
protects on which the fees are imposed and between the amount of the
fees and the cost of the affordable housing units or portion of the units
attributable to the development on which the fees are imposed.
(c) It is the intent of the City Council that the fee required by this
Chapter shall be supplementary to any conditions imposed upon a
development project pursuant to other provisions of the Municipal Code,
the CitV Charter, the Subdivision Map Act the California Environmental
Quality Act, other state and local laws which maV authorize the imposition
of project specific conditions on development.
9.74.020 Applicability of Chapter.
(a) The regulations requirements and provisions of this Chapter
and Council resolutions adopted pursuant hereto shall apply to any
commercial portion of any new Project for which a development
application was determined complete or an application for change(s) in
existing use(s) was made on or after the effective date of this Ordinance.
Any protect subject to the provisions of this Chapter shall not be required
to comply with Part 9.04.10.12 of the Santa Monica Municipal Code
Project Mitigation Measures.
(b) Notwithstanding the above the following projects or portions of
projects as specified thereof shall not be subject to the requirements of this
Chapter:
(1) places of worship;
(2) City projects;
(3) day care centers;
(4) private K -12 schools;
(5) commercial portions of multi- family rental housing projects developed
by a nonprofit housing provider if the developer is receiving financial assistance
through a public agency, so long as the multi - family rental housing project is an
affordable housing protect meeting the requirements of Santa Monica Municipal
Code Section 9.04.02.030.025 and the project's affordable housing obligations
will be secured by a regulatory agreement, memorandum of agreement or
recorded covenant with a public agency for a minimum period of fifty -five years;
(6) re- occupancy of square footage in an existing building or structure if
there is no change of use;
(7) square footage used for outdoor dining in the public right of way.
If a development is exempt from the fee at initial construction, but later
converts to a commercial development subject to this Ordinance the converted
square footage will be deemed net new commercial square footage and the
housing impact fee shall be paid prior to final approval of a building permit.
9.74.030 Definitions.
For the purpose of this Chapter, the following terms shall be
defined as follows:
(a) "City Proiects" shall mean City public works projects and City
community facilities (e.g. libraries public parking structures, recycling
centers and community centers) not including public /private partnerships.
9
(b) "Nexus Study" shall mean the Commercial Nexus Study and
Linkage Fee Analysis prepared by Rosenow Spevacek Group Inc dated
July 2013.
(c) "Project' shall mean any development having a commercial
use component and gross new or additional floor area of one thousand
square feet or more or that changes an existing use to a different use that
increases the demand for affordable housing Gross floor area for the
purposes of this definition shall be the same as Section 9.04.02.030.315,
or any successor legislation but shall exclude parking area.
(d) "Affordable Housinq Commercial Linkage Fee' shall mean a
fee paid to the City by an applicant pursuant to Section 9 74 040 of this
Chapter in connection with approval of a project to contribute to the
creation of affordable housing production or preservation to offset
additional need for affordable housing generated by new commercial
development.
9 74 040 Affordable Housing Mitigation Requirement.
Except as provided in Section 9.74.050, the developer of a Project
shall pay an affordable housing commercial linkage fee in accordance with
the following:
(a) Affordable Housing Commercial Linkage Fee. Fees shall be
computed as follows:
1 All non - residential portions of a Project shall pay the
following based on the gross square footage of each use included in the
proposed Project:
(A) Retail: $9.75 square foot.
(B) Office: $11.21 per square foot.
(C) Hotel /Lodging: $3.07 per square foot.
(D) Hospital: $6.15 per square foot.
(E) Industrial: $7.53 per square foot.
(F) Institutional: $10.23 per square foot.
(G) Creative Office: $9.59 per square foot.
(H) Medical Office: $6.89 per square foot.
2 The land use categories identified in subsections (A) — (H),
above shall have the following meanings:
(A) Retail shall include: animal kennels and veterinary hospitals
auto repair, car wash, retail and wholesale construction - related materials
nurseries and garden centers entertainment and recreational facilities
gas stations art galleries nightclubs and bars Personal services Post-
secondary educational facility, private studio restaurants — fast food and
cafes restaurants — sit down retail durable goods retail food and
markets retail mixed, and retail non -food.
(B) Office shall include: financial institutions and office, and
eneral office
IL
(C) Hotel /Lodging shall include: hotels motels and other
overnight accommodations.
(D) Hospital shall include: full service hospitals.
(E) Industrial shall include: surface or structured auto inventory
storage City maintenance facilities and bus yards heavy industrial and
manufacturing light industrial utilities warehouse and self - storage and
wholesale distribution and shipping.
(F) Institutional shall include: educational and cultural facilities.
(G) Creative Office shall include: offices production spaces and
work spaces of establishments that are in the business of the
development of creative property, including but not limited to advertising,
architectural services broadcasting communications, computer software
design entertainment engineering graphic design interior design
internet content landscape design, and similar uses.
(H) Medical Office shall include: Medical office including
medical clinics and offices for medical professionals.
3 The amount of legally permitted non - residential square
footaae to be demolished in an existing buildinq or structure, or to be
removed from an outdoor area used as part of a service station or for auto
dealer sales display and inventory storage as a part of a Proiect shall be
a credit in the calculation of the Affordable Housing Commercial Linkage
Fee Outdoor area used as part of a gas station shall not include
setbacks landscaping parking and other paved areas used solely for
11
access and circulation. Credit shall be applied on a per square foot basis
according to per square foot fee assigned to the type of commercial use
that existed on the site prior to the new Project application submittal.
Timing of Fee Payment.
1 The Project applicant shall pay fees according to the
schedule of fees in place on the date the fees are paid except that the
applicant for a vesting tentative map for a development project shall pay
the fees in effect on the date the application for the vesting tentative map
is deemed complete as automatically adjusted.
2 No building permit for any Proiect shall be issued unless the
fees have been paid.
9.74.050 Fee Adjustments and Waivers.
(a) A developer of any Proiect subject to the fee described in
Section 9 73 040 (a) maV request that the requirements of this Chapter be
adiusted or waived based on a showing that applVinq the requirements of
this Chapter would effectuate an unconstitutional taking of property or
otherwise have an unconstitutional application to the propertV.
(b) To receive an adjustment or waiver, the applicant must submit
an application to the City Manager or her /his designee at the time the
applicant files a discretionary project application or if no such application
is required a building permit application The applicant shall bear the
burden of presenting substantial evidence to support the request and set
12
forth in detail the factual and legal basis for the claim including all
supporting technical documentation.
(c) The City Manager or her /his designee shall render a written
decision within ninety days after a complete application is filed The City
Manager's or designee's decision may be appealed to the CitV Council if
such appeal is filed within fourteen consecutive calendar days from the
date that the decision is made in the manner provided in Part 9.04.20.24,
Sections 9.04.20.24.010 through 9.04.20.24.050 of this Code or anV
successor thereto.
(d) If the City Manager or her/- is designee or City Council on
appeal upon legal advice provided by or at the behest of the City
Attorney determines that applying the requirements of this Chapter would
effectuate an unconstitutional taking of property or otherwise have an
unconstitutional application to the property the affordable housing fee
requirements shall be adjusted or waived to reduce the obligations under
this Chapter to the extent necessary to avoid an unconstitutional result. If
the City Manager or her /his designee or City Council on appeal
determines that no violation of the United States or California
Constitutions would occur through application of this Chapter, the
requirements of this Chapter remain fully applicable
(fl If an adjustment or waiver is granted any change in use
from the approved proiect shall invalidate the adjustment or waiver.
13
9.74.060 Fee Revenue Account.
Pursuant to Government Code Section 66006. the Affordable
Housing Commercial Linkage Fee Reserve Account is hereby established.
The fees paid to the City pursuant to the provisions of this Chapter shall
be deposited into the Affordable Housing Commercial Linkage Fee
Reserve Account and used solely for the purpose described in this
Chapter. All monies deposited into the Reserve Account shall be held
separate and apart from other City funds All interest or other earnings on
the unexpended balance in the Reserve Account shall be credited to the
Reserve Account.
9.74.070 Distribution of Affordable Housing Commercial
Linkage Fee Funds.
All monies and interest earnings in the Affordable Housing
Commercial Linkage Fee Reserve Account shall be expended solely on
the production or preservation of affordable housing to help fulfill the need
identified in the Nexus Study to increase the supply of housing affordable
to worker households of extremely low, very low, low, or moderate
income or such other report as maV be prepared from time to time to
document the reasonable fair share of the costs to mitigate the increased
need for affordable housing that is created bV new commercial
development Such expenditures may include but are not necessarily
limited to the following:
(a) Reimbursement for all direct and indirect costs incurred by
the City to fund the production of affordable housing pursuant to this
14
Chapter including but not limited to the cost of land and right -of -way
acquisition planning legal advice engineering design construction
construction management materials and equipment or issuing loans to
nonprofit affordable housing developers to acquire land and /or to
rehabilitate existing buildings or build new developments to increase the
supply of affordable housing units.
(b) Costs of issuance or debt service associated with bonds,
notes or other security instruments issued to fund affordable housing
needs identified.
(c) Reimbursement for administrative costs incurred by the City
in establishing or maintaining the Affordable Housing Commercial Linkage
Fee Reserve Account required bV this Chapter, including but not limited to
the cost of studies to establish the requisite nexus between the fee
amount and the use of fee proceeds and yearly accounting and reports.
No portion of the Affordable Housing Commercial Linkage Fee
Reserve Account may be diverted to other purposes bV way of loan or
otherwise.
9.74.080 Periodic Review and Adiustment of Affordable
Housing Commercial Linkage Fees.
To account for inflation in affordable housing development costs,
the fee imposed bV this ordinance shall be adjusted automatically on July
1 of each fiscal year, beginning on JuIV 1 2015 by a percentage equal to
the appropriate Construction Cost Index as published by Engineering
15
News Record or its successor publication for the preceding twelve (12)
months.
9.74.090 Fee Refunds.
(a) If an affordable housing commercial linkage fee is collected
on a Project and the permit for that Project later expires, is vacated or
voided before commencement of construction the developer shall upon
request be entitled to a refund of the unexpended housing commercial
linkage fee paid less a portion of the fee sufficient to cover costs of
collection accounting for and administration of the fee paid. Any request
for a refund shall be submitted in writinq to the Planning and Community
Development Director within one year of the date that the permit expires
or is vacated or voided Failure to timely submit a request for refund shall
constitute a waiver of any right to a refund.
(b) Fees collected pursuant to this Chapter which remain
unexpended or uncommitted for five or more fiscal years after deposit into
the Affordable Housing Commercial Linkage Fee Reserve Account shall
be accounted for or may be refunded as provided by state law.
9.74.100 Fee revision by resolution.
The amount of the affordable housinq commercial linkage fee and
the formula for the automatic annual adjustment established by this
Chapter may be reviewed and revised periodically by resolution of the City
Council This Chapter shall be considered enabling and directive in this
regard.
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9.74.110 Regulations.
The City Manager, or her /his designee is authorized to adopt
written administrative regulations or guidelines that are consistent with and
that further the terms and requirements set forth within this Chapter.
SECTION 2. This Ordinance shall apply to all development applications meeting
the criteria for applicability as defined herein determined complete after the effective
date of this Ordinance.
SECTION 3. The Council finds that the adoption of this ordinance is not a project
pursuant to CEQA Guideline section 15378(b)(4), which excludes from the definition of
Project "the creation of government funding mechanisms or other government fiscal
activities, which do not involve any commitment to any specific project which may result
in a potentially significant physical impact on the environment." Alternatively, the
proposed ordinance is exempt from the provisions of the California Environmental
Quality Act (CEQA) pursuant to Section 15061(b)(3) in that it can been seen with
certainty that the proposed ordinance does not have the potential to significantly impact
the environment, since the proposed ordinance amendment is a fee that will be levied
on projects that will be evaluated in compliance with CEQA on their own merits.
SECTION 4. Any provision of the Santa Monica Municipal Code or appendices
thereto inconsistent with the provisions of this Ordinance, to the extent of such
inconsistencies and no further, is hereby repealed or modified to that extent necessary
to effect the provisions of this Ordinance.
17
SECTION 5. If any section, subsection, sentence, clause, or phrase of this
Ordinance is for any reason held to be invalid or unconstitutional by a decision of any
court of competent jurisdiction, such decision shall not affect the validity of the
remaining portions of this Ordinance. The City Council hereby declares that it would
have passed this Ordinance and each and every section, subsection, sentence, clause,
or phrase not declared invalid or unconstitutional without regard to whether any portion
of the ordinance would be subsequently declared invalid or unconstitutional.
SECTION 6. The Mayor shall sign and the City Clerk shall attest to the passage
of this Ordinance. The City Clerk shall cause the same to be published once in the
official newspaper within 15 days after its adoption. This Ordinance shall become
effective 30 days from its adoption.
APPROVED AS TO FORM:
C ity
iE
City Council Meeting: September 23, 2014 Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA ADDING CHAPTER 9.75 TO THE SANTA MONICA MUNICIPAL
CODE ESTABLISHING THE PARKS AND RECREATION DEVELOPMENT IMPACT
FEE PROGRAM, THE PARKS AND RECREATION DEVELOPMENT IMPACT FEES,
AND ESTABLISHING AN ADJUSTMENT AND WAIVER PROVISION
WHEREAS, approximately 89,000 people live in the City, on weekdays there are
about 300,000 present in the City, and on weekends and holidays the number of
persons in the City soars to between 500,000 and 1 million; and
and
WHEREAS, new development will continue to occur in the City of Santa Monica;
WHEREAS, increased population due to this new development will place
additional burdens on the city -wide community and recreation facilities; and
WHEREAS, to maintain a similar level of service to the population, new facilities
are required; and
WHEREAS, the City has adopted an Open Space Element of its General Plan
and a Parks and Recreation Master Plan (Master Plan) to establish a long -range vision
for the future development of parks and open space; and
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WHEREAS, the Master Plan states that everyone who lives, works in, and visits
the City benefits from the parks, beach, recreational facilities, and associated amenities,
and funding should come from all parks and recreational facilities users to the extent
possible; and
WHEREAS, objectives of the Open Space Element include developing,
expanding and maintaining a diversified and balanced system of high - quality open
space; and
WHEREAS, the Open Space Element calls for heightening the sense of nature in
the City, including maintaining and expanding the community forest and promoting
biodiversity in and expanding city gardens; and
WHEREAS, Open Space Element Policy 1.4 states that opportunities should be
provided for the enjoyment of open space within every Santa Monica neighborhood; and
WHEREAS, Open Space Element Policy 9.1 calls for increasing physical access
to parks and open spaces, particularly for youth and persons with disabilities; and
WHEREAS, Chapter 3.5 of the Land Use and Circulation Element ( "LUCE ")
complements the objectives, goals, and policies of the Open Space Element and Master
Plan; and
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WHEREAS, LUCE Goal CE1 calls for the expansion of the amount, quality,
diversity, interconnectivity of parks, open spaces and recreational facilities throughout
the City; and
WHEREAS, these planning documents reflect the City's commitment to parks
and recreation for its citizens; and
WHEREAS, to implement these policies, the City intends to require every person
who develops or redevelops land in the City to mitigate the impacts of such
development or redevelopment by paying fees that will be used to develop parks and
recreation facilities; and
WHEREAS, a number of existing municipal code sections imposing fees on
development for parks improvements are antiquated and no longer reflect the needs of
the community; and
WHEREAS, a Parks and Recreation Development Impact Fee Study was
prepared by Economic and Planning Systems, Inc. in August 2013 to analyze the
relationship between new development in the City, the increased demand for and use of
parks and recreation facilities, and the amount of fee revenue necessary to fund new
parks and recreation facilities in response to the increased demand ( "Nexus Study ");
WHEREAS, the Nexus Study used the standard -based method to calculate the
fees to maintain the current level of service, i.e., the ratio of the value of existing
facilities divided by the current population to arrive at the per capita cost; and
9
WHEREAS, under this approach, the current levels for the provision of parks and
recreation facilities and parkland by the City were used as the basis for determining the
fair share contribution of new development; and
WHEREAS, the maximum, supportable parks and recreation fee schedule was
based on a parks and recreation capital facilities cost estimate derived by applying the
proportionate increase in service population associated with new development to the
existing service standard /value of parks and recreation capital facilities; and
WHEREAS, these fees will be used for a broad range of parks and recreation
facilities investments, including the acquisition of land for parks, the improvement of
existing and new parkland, and development of new parks and recreation facilities; and
WHEREAS, the amount of fees collected pursuant to this Ordinance is limited to
the cost of these public facilities attributable to new development and the amount of
these fees shall not include the cost of facilities attributable to demand generated by
existing development; and
WHEREAS, other sources of City revenue, including tax revenue will be used for
many public purposes and will not be sufficient to offset the burdens on parks and
recreation facilities created by new development.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Chapter 9.75 is hereby added to the Santa Monica Municipal Code
to read as follows:
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Chapter 9.75
Parks and Recreation Development Impact Fee
Program
9.75.010 Findings and Purpose.
(a) The purpose of this Chapter is to implement the goals,
objectives and policies of the City of Santa Monica's Open Space Element
and Parks and Recreation Master Plan when new development is
constructed within the City limits. Imposing a fee that is reasonably
related to the burdens on and increased demand for the City's parks and
recreation facilities created by new development will assist the City in
constructing the required capital improvements to support the fulfillment of
these goals objectives and policies.
(b) The City has prepared a Parks and Recreation Development
Impact Fee Nexus Study that demonstrates and the City Council finds,
that there is a reasonable relationship between the purpose for which the
fees established by this Ordinance are to be used and the type of
development projects on which the fees are imposed and between the
amount of the fees and the cost of the parks and recreation facilities or
portion of the facilities attributable to the development on which the fees
are imposed.
(c) It is the intent of the City Council that the fee required by this
Chapter shall be supplementary to any conditions imposed upon a
development protect pursuant to other provisions of the Municipal Code,
the City Charter, the Subdivision Map Act the California Environmental
5
Quality Act and other state and local laws which may authorize the
imposition of project specific conditions on development.
9.75.020 Applicability of Chapter.
(a) The regulations requirements and provisions of this Chapter and
Council resolutions adopted pursuant hereto shall apply to all new Projects for
which a development application was determined complete or an application for
change(s) in existing use(s) was made on or after the effective date of this
Ordinance Any protect subject to the provisions of this Chapter shall not be
required to comply with Chapter 6.80 or Part 9.04.10.12 of the Santa Monica
Municipal Code Project Mitigation Measures.
b) Notwithstandina the above, the followinq projects square footage
and affordable residential units shall not be subject to the requirements of this
Chapter:
(1) places of worship;
(2) City projects;
(3) day care centers;
(4) private K -12 schools;
(5) multi - family rental housing projects developed by a nonprofit housing
provider if the developer is receiving financial assistance through a public
agency so long as the multi - family rental housing project is an affordable
housing project meeting the requirements of Santa Monica Municipal Code
Section 9.04.02.030.025 and the project's affordable housing obligations will be
secured by a regulatory agreement memorandum of agreement or recorded
covenant with a public agency for a minimum period of fifty -five nears;
(6) re- occupancy of square footage in an existing building or structure if
there is no change of use:
(7) square footage used for outdoor dining in the public right of way; and
(8) affordable housing units deed restricted to extremely low, very -low
income, or low income households.
If a development is exempt from the fee at initial construction but later
converts to a development subject to this Ordinance the converted square
footage will be deemed net new square footage and the parks and recreation fee
shall be paid prior to final approval of a building permit or, if required by State
law, before the date of final inspection or the issuance of a certificate of
occupancy, whichever occurs first.
9.75.030 Definitions.
For the purpose of this Chapter, the following terms shall be
defined as follows:
(a) "City Projects" shall mean City public works projects and City
community facilities (e.g. libraries public parking structures recycling
centers and community centers) not including public /private partnerships.
(b) "Nexus Study" shall mean the Parks and Recreation
Development Impact Fee Nexus Study prepare- Economic & Planning
Systems Inc. dated August 2013.
M
(c) "Protect" shall mean any development having a gross new or
additional floor area of one thousand square feet or more, or that changes
an existing use to a different use that increases the demand on the parks
and recreation system or residential development of improved or
unimproved land which adds dwelling units. Gross floor area for the
purposes of this definition shall be the same as Section 9.04.02.030.315,
or any successor legislation, but shall exclude parking area.
"Parks and Recreation Development Impact Fee" shall
mean a fee paid to the City by an applicant pursuant to Section 9.75.040
of this Chapter in connection with approval of a protect to contribute to the
acquisition and development of open space parkland and recreation
facilities to meet demand generated by new development in order to
maintain current service levels consistent with the goals obiectives and
policies of the City's Open Space Element and Parks and Recreation
Master Plan.
9.75.040 Parks and Recreation Mitigation Requirement.
Except as provided in Section 9.75.050, the developer of a Project
shall pay a Parks and Recreation Development Impact Fee in accordance
with the following:
(a) Parks and Recreation Development Impact Fee. Fees shall
be computed as follows:
1 For Single Family residential development projects that
result in the addition of a dwelling unit:
(A) $7,636 per single family dwelling unit.
2 For Multi - Family residential development projects that result
in the addition of a dwelling unit:
(A) $4,138 per studio /one - bedroom multi - family dwelling
unit.
(B) $6,665 per multi - family dwelling unit with two or more
bedrooms.
3 All non - residential projects shall pay the following based on
the gross square footage of the proposed proiect:
A) Office: $2.31 per square foot
(B) Medical Office: $1.27 per square foot.
(C) Retail: $1.49 per square foot.
(E) Lodging: $3.11 per square foot.
(F) Industrial: $1.30 per square foot.
4 The land use categories identified in subsections (1) — (3),
above shall have the following meanings:
(A) Single Family Residential shall include Single Family.
(B) Multi - Family Residential shall include: congregate
care —non senior, congregate care — seniors, and multi — family.
(C) Office shall include: creative office financial
institutions and office and general office.
(D) Medical office shall include: full service hospitals and
medical offices including medical clinics and offices for medical
professionals.
(E) Retail shall include: animal kennels and veterinary
hospitals auto repair, car wash non - residential adult care facilities,
retail and wholesale construction - related materials, nurseries and
garden centers entertainment and recreational facilities, gas
stations and art galleries nightclubs and bars Personal services
Post - secondary educational facility private studio restaurants —
fast food and cafes restaurants — sit down retail durable goods,
retail food and markets retail mixed and retail non -food.
(F) Lodging shall include: hotels motels and other
overnight accommodations.
(G) Industrial shall include: surface or structured auto
inventory storage heavy industrial and manufacturing light
industrial utilities warehouse and self - storage and wholesale
distribution and shipping.
5 For mixed residential /nonresidential development the sum of
the fee required for each component as set forth above in
subdivisions (a)(2) and (a)(3) of this subsection.
6 The amount of legally permitted square footage to be
demolished in an existing building or structure as a part of a Proiect
10
shall be a credit in the calculation of the Parks and Recreation
Development Impact Fee.
(b) Timing of Fee Payment.
1 The Proiect applicant shall pay fees according to the
schedule of fees in place on the date the fees are paid except that the
applicant for a vesting tentative map for a development project shall pay
the fees in effect on the date the application for the vesting tentative map
is deemed complete as automatically adjusted.
2 No building permit for any Proiect shall be issued unless the
fees have been paid except for residential uses where state law requires
payment before final inspection or the issuance of certificate of
occupancy, whichever comes first If state law applies, a contract to pay
the fees shall be executed with the City, in which case no final inspection
shall be approved until the fees have been paid. If a residential
development proiect contains more than one dwelling unit and is approved
for development in phases the developer shall pay the fees in
installments based on the phasing of the residential development
protect Each fee installment shall be paid at the time when the first
dwelling unit within each phase of development has received its final
inspection.
3 For all Projects subiect to this Chapter, the City may require
the payment of fees at an earlier time if the fees will be collected for public
improvements or facilities for which an account has been established and
11
funds appropriated and for which the City has a proposed construction
schedule or plan prior to final inspection or the fees are to reimburse the
City for expenditures previously made.
9.75.050 Fee Adjustments and Waivers.
(a) A developer of any Project subiect to the fee described in
Section 9 75 040 may request that the requirements of this Chapter be
adjusted or waived based on a showing that applying the requirements of
this Chapter would effectuate an unconstitutional taking of property or
otherwise have an unconstitutional application to the property.
(b) To receive an adjustment or waiver, the applicant must submit
an application to the City Manager or her /his designee at the time the
applicant files a discretionary project application or if no such application
is required a building permit application The applicant shall bear the
burden of presenting substantial evidence to support the request and set
forth in detail the factual and legal basis for the claim including all
supporting technical documentation.
(c) The CitV Manager or her /his designee. shall render a written
decision within ninety days after a complete application is filed. The City
Manager's or designee's decision may be appealed to the City Council if
such appeal is filed within fourteen consecutive calendar days from the
date that the decision is made in the manner provided in Part 9.04.20.24,
Sections 9.04.20.24.010 through 9.04.20.24.050 of this Code or any
successor thereto.
12
(d) If the City Manager or her/his designee or City Council on
appeal upon legal advice provided by or at the behest of the City
Attorney, determines that applyinq the requirements of this Chapter would
effectuate an unconstitutional taking of propertV or otherwise have an
unconstitutional application to the property, the affordable housing fee
requirements shall be adiusted or waived to reduce the obligations under
this Chapter to the extent necessary to avoid an unconstitutional result. If
the City Manager or her /his designee or City Council on appeal
determines that no violation of the United States or California
Constitutions would occur through application of this Chapter, the
requirements of this Chapter remain fully applicable
(e) If an adjustment or waiver is granted, any change in use from
the approved project shall invalidate the adjustment or waiver.
9.75.060 Fee Revenue Account.
Pursuant to Government Code Section 66006 the Parks and
Recreation Development Impact Fee Reserve Account is hereby
established The fees paid to the City pursuant to the provisions of this
Chapter shall be deposited into the Parks and Recreation Development
Impact Fee Reserve Account and used solely for the purpose described in
this Chapter. All monies deposited into the Reserve Account shall be held
separate and apart from other CAV funds All interest or other earnings on
the unexpended balance in the Reserve Account shall be credited to the
Reserve Account.
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9.75.070 Distribution of Parks and Recreation Development
Impact Funds.
All monies and interest earnings in the Parks and Recreation
Development Impact Fee Reserve Account shall be expended solely on
the development design construction and administration costs related to
the acquisition of land for parks the improvement of existing and new
parkland and the development of new parks and recreation facilities
needed to accommodate additional occupants of new development
protects Such expenditures may include but are not necessarily limited
to the following:
(a) Reimbursement for all direct and indirect costs incurred by
the City to construct parks and recreation improvements pursuant to this
Chapter, including but not limited to the cost of land acquisition planning
legal consultation engineering design construction construction
management, materials and equipment.
(b) Costs of issuance or debt service associated with bonds,
notes or other security instruments issued to fund parks and recreation
improvements as identified
(c) Reimbursement for administrative costs incurred by the City
in establishing or maintaining the Parks and Recreation Development
Impact Fee Reserve Account required by this Chapter, including but not
limited to the cost of studies to establish the requisite nexus between the
fee amount and the use of fee proceeds and yearly accounting and
reports.
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No portion of the Parks and Recreation Impact Fee may be diverted
to other purposes by way of loan or otherwise.
9.75.080 Periodic Review and Adjustment of Parks and
Recreation Development Impact Fees.
To account for inflation in construction costs the fee imposed bV
this ordinance shall be adjusted automatically on July 1 of each fiscal
year, beginning on JuIV 1 2015 by a percentage equal to the appropriate
Construction Cost Index as published bV Engineering News Record, or its
successor publication for the preceding twelve (12) months.
9.75.090 Fee Refunds.
(a) If a Parks and Recreation development impact fee is
collected on a Project and the permit for that Protect later expires, is
vacated or voided before commencement of construction the developer
shall upon request be entitled to a refund of the unexpended Parks and
Recreation development impact fee paid less a portion of the fee
sufficient to cover costs of collection accountinq for and administration of
the fee paid AnV request for a refund shall be submitted in writing to the
Planning and CommunitV Development Director within one year of the
date that the permit expires or is vacated or voided Failure to submit a
timely request for refund shall constitute a waiver of any right to a refund.
(b) Fees collected pursuant to this Chapter which remain
unexpended or uncommitted for five or more fiscal years after deposit into
ib1
the Parks and Recreation Development Impact Fee Reserve Account shall
be accounted for or may be refunded as provided by state law.
9.75.100 Fee revision by resolution.
The amount of the Parks and Recreation development impact fees
and the formula for the automatic annual adjustment established by this
Chapter may be reviewed and revised periodically by resolution of the City
Council. This Chapter shall be considered enabling and directive in this
regard.
9.75.110 Regulations.
The City Manager, or her /his designee is authorized to adopt
written administrative regulations or guidelines that are consistent with and
that further the terms and requirements set forth within this Chapter.
SECTION 2. This Ordinance shall apply to all development applications meeting
the criteria for applicability as defined herein determined complete after the effective
date of this Ordinance.
SECTION 3. The Council finds that the adoption of this ordinance is not a project
pursuant to CEQA Guideline section 15378(b)(4), which excludes from the definition of
Project "the creation of government funding mechanisms or other government fiscal
activities, which do not involve any commitment to any specific project which may result
in a potentially significant physical impact on the environment." Alternatively, the
proposed ordinance is exempt from the provisions of the California Environmental
Quality Act (CEQA) pursuant to Section 15061(b)(3) in that it can be seen with certainty
`[y
that the proposed ordinance does not have the potential to significantly impact the
environment, since the proposed ordinance amendment is a fee that will be levied on
projects that will be evaluated in compliance with CEQA on their own merits.
SECTION 4. Any provision of the Santa Monica Municipal Code or appendices
thereto inconsistent with the provisions of this Ordinance, to the extent of such
inconsistencies and no further, is hereby repealed or modified to that extent necessary
to effect the provisions of this Ordinance.
SECTION 5. If any section, subsection, sentence, clause, or phrase of this
Ordinance is for any reason held to be invalid or unconstitutional by a decision of any
court of competent jurisdiction, such decision shall not affect the validity of the
remaining portions of this Ordinance. The City Council hereby declares that it would
have passed this Ordinance and each and every section, subsection, sentence, clause,
or phrase not declared invalid or unconstitutional without regard to whether any portion
of the ordinance would be subsequently declared invalid or unconstitutional.
SECTION 6. The Mayor shall sign and the City Clerk shall attest to the passage
of this Ordinance. The City Clerk shall cause the same to be published once in the
official newspaper within 15 days after its adoption. This Ordinance shall become
effective 30 days from its adoption.
D AS TO FORM:
MOU RIE
C ity
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