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Judson Brown, City of Santa Ana <br />Lacy Street Project: Preliminary Financial Gap Analysis <br />Table 1: Estimated Construction Costs <br />Table 2: Estimated Available Revenue <br />Table 3: Financial Gap Calculation <br />Estimated Construction Costs (Table 1) <br />EXHIBIT 2 <br />January 18, 2019 <br />Page 4 <br />KMA reviewed Habitat's January 2, 2019 pro forma and then independently prepared a <br />pro forma analysis of the Project. The resulting construction costs are estimated as <br />follows: <br />Direct Costs <br />The direct costs assume that the Project will not be subject to State of California and/or <br />Federal Davis Bacon prevailing wage requirements. As noted previously, the design <br />elements proposed for the Project are more in line with custom home developments. <br />As such, it is difficult to estimate the appropriate direct costs without more detailed <br />plans and drawings. Thus, for the purposes of this preliminary financial gap analysis, <br />KMA utilized the direct cost estimates provided by Habitat. The direct costs can be <br />summarized as follows: <br />1. The on-site improvement costs are estimated at $8 per square foot of land area, <br />or $124,000. <br />2. The building costs are estimated at $144 per square foot of GBA, or $460,000. <br />This equates to an average of $230,000 per unit. <br />3. A 4% allowance for general requirements is provided, which equates to $23,000. <br />4. Per Habitat, the Project's construction (estimated at 12 months) will require the <br />supervision of two Habitat staff members. The supervision costs are estimated <br />at $120,000, or $60,000 per Habitat staff member. <br />5. KMA included a $36,000 direct cost contingency allowance, which is equal to 5% <br />of other direct costs. <br />KMA estimates the total direct costs at $763,000. This equates to $238 per square foot <br />of GBA or an average of $381,500 per unit. <br />1901009:SA:TRB <br />80A-16 19090.017.011 <br />