Laserfiche WebLink
8.A. — Pag&17T9f36andum <br />Financial Review of Proposed Sequoia Station Development <br />Figure 1: Existing Sequoia Station Site Plan' <br />a <br />a =a <br />a <br />W <br />Q t <br />a <br />hI <br />m <br />io r- <br />� f <br />d L n <br />O <br />M <br />FL CAMINo REAL <br />Nf1EU. alu 1462 <br />PI#tWd <br />Analytical Framework <br />MI <br />LON <br />September 28, 2020 <br />Page 2 <br />QLL <br />W <br />PYLON <br />OlD NAVI <br />For the purposes of this analysis, development feasibility is defined as a project that is likely to <br />generate a level of financial return typically needed to attract investment in the real estate <br />industry. EPS has evaluated this issue using a development pro forma model that simulates the <br />expected cash-flow from several building prototypes (e.g. a mixed-use office or residential <br />project). <br />As a proxy for development feasibility, EPS has estimated the likely residual land value for <br />alternative land use programs for the Sequoia Station site. Residual land value is defined as the <br />difference between total project development costs (including return on investment but excluding <br />land costs) and the market value of the finished product. Residual land value can provide a good <br />indication of what a real estate investor/developer might be willing to pay to acquire and <br />improve a site assuming the type of project under consideration can be built. <br />Table 1 summarizes five alternative land use concepts evaluated as part of this analysis. As <br />shown, EPS has compared the financial performance of two preliminary alternatives that roughly <br />correspond to those proposed by the developer against three hypothetical alternatives. The <br />hypothetical alternatives have been defined with input from City staff to test the economic <br />implications of critical land use parameters that are important to the planning process, including <br />1 Figure does not show existing below grade parking. <br />sna, «.,oaks a,zo,000=,o osz_0.eawooII,t,F s a a o eo oas oe a hese° oaS,tt Memo_ _. `09 <br />