80B - JAMBOREE HOUSING PRE-LOAN COMMITMENT

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Judson Brown, City of Santa Ana February 21, 2019 Budget Inn: Preliminary Financial Gap Analysis Page 4 Estimated Development Costs (Table 1) KMA reviewed the Developer's February 14, 2019 pro forma and then independently prepared a pro forma analysis of the Project. The resulting development costs are estimated as follows: Property Assemblage Costs The following summarizes the property assemblage costs: 1. The Developer proposes to purchase the property for $15.09 million, or $165,800 per unit. The Developer did not provide an appraisal for review. The KMA analysis will need to be revised if the appraised value differs from the proposed purchase price. 2. It should be noted that the Developer does not anticipate any relocation costs for the Project, and a relocation plan was not provided for review. This analysis will need to be revised if the Project is ultimately subject to any relocation expenses. 3. The closing costs are estimated at $25,000, or less than 1% of the proposed purchase price. The total property assemblage costs are estimated at $15.11 million. Direct Costs The direct cost estimates assume that the Project will be subject to Federal Davis Bacon and/or State of California prevailing wage requirements. The direct costs applied in this analysis can be summarized as follows: The Developer assumes that the Project will not be required to complete any off- site improvements. City staff should verify the accuracy of this assumption. 2. The Developer estimates the residential rehabilitation costs at approximately $5.20 million, or $57,100 per unit. The Developer has not completed a physical needs assessment nor finalized the scope of rehabilitation. The KMA analysis will need to be revised if the residential rehabilitation costs differ than the estimates provided by the Developer for this analysis. TRB 80B-22 119090.17.009 19090.017.009