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City of Santa Ana <br />Proposal for Services <br />July 15, 2014 <br />Page 2 of 8 <br />rent levels, vacancy rates, absorption rates, and other factors that may impact market <br />potential. <br />Kosmont will perform a brief review of property sales and /or tenant lease rates for <br />different product types to provide corroboration for observed market pricing levels, as <br />well as to provide insight into the potential for success of different development <br />approaches. <br />Task 3: Highest and Best Use Analysis <br />Kosmont will identify the potential highest and best use of the Site based on the results <br />of the site and market analyses, an understanding of Client's goals, entitlement and <br />development constraints identified including political and community issues which may <br />affect or delay development approvals. Kosmont will provide an analysis identifying the <br />market -based highest and best use and include supporting market data and assessment <br />of financial viability based on relevant metrics and other factors as may be appropriate. <br />Such analysis will include the results of initial meetings with the Elks property ownership <br />to ascertain the fundamental direction and priorities of the Elks. <br />Task A: Initial discussions with Elks and Zoo Representatives! Initial Letter of <br />Intent or MOU <br />Kosmont will engage in discussions with representatives from the Elks Lodge and Santa <br />Ana Zoo to determine commonalities and preferred approaches to the project based on <br />various site plan options. As part of that process, Kosmont will assess the potential for <br />the Elks to relocate some or all of their activities to other adjacent or nearby sites <br />(preliminary), which will also include confirming parking requirements and zoo operations <br />preferences in terms of primary entrance and other considerations, Kosmont can also <br />evaluate the potential for a joint use in the form of a combined facility as a potential use <br />that would accommodate special events and other activities. <br />Based on these discussions and prior activities, Kosmont can explore various strategic <br />alternatives that could be pursued through a Memorandum of Understanding (MOU) or <br />initial Letter of Intent and assist with identifying and drafting preliminary terms and <br />conditions to move forward in a binding transaction. <br />Task 5: Preliminary Financial Analysis and Summary of Analysis <br />Kosmont will provide a standard summary development pro forma illustrating the <br />projected Costs and expenses associated with the highest and best use analysis and <br />estimated net operating income and rate of return projections. Consultant will use <br />available "off the shelf' cost data and will not require the services of construction cost <br />estimator unless requested by Client (would be additional cost). <br />Deliverables for Tasks 1 through 6 will be a summary of Kosmont's findings in <br />PowerPoint or memo format including the development pro forma. <br />KOS MONT COMPANIES <br />866 South Figueroa Street 361h Floor Los Angeles CA 90017 ph 213.417.3300 fx 213.417.3311 www.kosmontcom <br />25B -12 <br />