Applicant Supplemental Documents for 8844 Burton Way — Beverly Hills City Council, March 24, 2026

633 West Fifth Street
Suite 5880
Los Angeles, CA 90071
213.557.7222
www.rpnllp.com
Dave Rand
213.557.7224
[email protected]
March 23, 2025

VIA EMAIL
Cindy Gordon
Assistant Director of Community Development/City Planner City of Beverly Hills
[email protected]

Re: 8844 Burton Way – Additional Documents for Appeal
Agenda Item F-1
Dear Ms. Gordon:

We represent 8844 Burton Way LLC (“Applicant”) concerning the Applicant’s appeal (“Appeal”) of the Planning Commission’s denial of the housing development project proposed at 8844 Burton Way.

Please include the attached documents in the administrative record for the Appeal hearing tomorrow night, Agenda Item F-1.

Sincerely,
Dave Rand
Dave Rand
Partner
of RAND PASTER & NELSON, LLP
Attachments
Exhibit A – Financial Analysis of Planned High-Rise Apartments Exhibit B – Cost Reduction Analysis
Exhibit C – Waiver Analysis
Exhibit A
Financial Analysis of Planned
High-Rise Apartments
8844 Burton Way
Beverly Hills, California
Prepared for 8844 Burton Way, LLC
March 20, 2026
8844 Burton Way | 16399.01 | March 20, 2026 | 2
Since 1967, RCLCO has been the “first call” for real estate developers, investors, the public sector, and non-real estate companies and organizations seeking strategic and tactical advice regarding property investment, planning, and development.

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INTRODUCTION
Key Findings 5
Impact of Views & Balconies 7
Financial Analysis 11
Disclaimers 14
Objectives
8844 Burton Way, LLC (“Client”) is planning the development of a new highrise apartment building at 8844 Burton Way in Beverly Hills, California. Current plans for the project call for a 26-story tower comprising 200 apartment units (including 22 affordable units: 14 extremely low income units and 8 moderate income units) and 318 parking spaces. The current design of the building has units on the northern and southern sides of the building, with full-length outdoor decks that all have transparent glass guardrails, providing both outdoor space as an extension of the unit as well as attractive views for future residents.

The City of Beverly Hills has requested that Client adjust the plans for the project’s balconies to feature opaque, 42-inch guardrails as opposed to the planned glass. Client believes these opaque balconies limit the view potential of the units and negatively impact the financial feasibility of the development.

Against this background, Client engaged RCLCO to provide a third-party Financial Feasibility Analysis of two development scenarios, one with glass guardrails on all units and one with opaque guardrails on all south-facing units. Analytical objectives of the Financial Feasibility Analysis included the following:
► Constructed a static financial model using Client’s initial assumptions, background materials, and plans, focusing on yield on cost to measure financial feasibility.
► Addressed the reasonableness of the inputs through industry expertise and market research.
► Evaluated the impact of views and transparent vs. opaque guardrails on achievable rents.
► Provided conclusions with respect to the feasibility or infeasibility of each scenario.
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Key Findings
8844 Burton Way | 16399.01 | March 20, 2026 | 6
Based on RCLCO’s analysis of the financial model and
understanding of financial feasibility for high-rise
multifamily apartment developments, our conclusions
are as follows:

The planned scenario that includes transparent balconies is financially feasible because the yield on total development cost is 5.06%, which is above the minimum threshold that would attract investment capital to a multifamily project in Beverly Hills, defined as a 5% threshold yield (market capitalization rate of 4% plus 100 basis points).

The alternate scenario with opaque balconies on half of the units is not financially feasible as the lower rents for these units reduces the project’s net operating income, and also the yield on cost. The yield on cost for this scenario is 4.05%, which falls below the minimum threshold.

Without the transparent balconies, the project would not be capitalized and built. Therefore, the planned configuration of the units and balconies is not merely to increase profitability or enhance returns, but instead are essential to take advantage of the main benefit of high-rise construction – attractive and expansive views.

RCLCO selected these financial feasibility thresholds because they represent typical benchmarks that a lender would expect for a typical multifamily development before deciding to proceed with financing.
► Yield on total development cost, which is calculated as net operating income (i.e., gross income less an allowance for vacancy and operating expenses) divided by total development cost (i.e., land costs, hard costs, soft costs, and financing costs), is frequently used by the real estate industry as an initial project feasibility screening measure. ► The minimum threshold for return on development cost, which we assumed as 100 basis points above the applicable market capitalization (or “cap”) rate for new development at this location, accounts for entitlement and construction risk on part of the developer and is typically the return a developer would be expected to show in order to attract outside capital to the project.

The basis for the following conclusions is summarized on the subsequent pages.

KEY CONCLUSIONS
Summary of Investment Feasibility (Yield on Cost)
8844 Burton Way; Beverly Hills, California
Source: Client; RCLCO

TRANSPARENT

BALCONIES
OPAQUE

BALCONIES
Total Development Costs (Land, Hard, Soft, Financing) $359,257,472 $359,257,472 Net Operating Income (Gross Income less Vacancy & Expenses) $18,176,197 $14,537,258 Yield on Cost (NOI / Costs) 5.06% 4.05%
Minimum Threshold (Cap Rate + Spread) 5.00% 5.00%
Financially Feasible? (Above Minimum Threshold?) YES NO 8844 Burton Way | 16399.01 | March 20, 2026 | 7
Impact of Views &
Balconies
8844 Burton Way | 16399.01 | March 20, 2026 | 8
High-rise apartment developments offer a range of benefits to both renters and property owners. In addition to creating greater density on a site and an alternative to lower-density product types, they provide an elevated lifestyle experience through design features, such as floor-to-ceiling windows and expansive views, among other amenities and services. These qualities are integral to the market positioning and financial performance of most high-rise developments.

In the Los Angeles region, and other urban markets, views are consistently used as a primary selling point in marketing materials. Developers and property managers use views and outdoor space on balconies not only to differentiate their projects but also to justify the rents. A few examples in Los Angeles include:
► Ten Thousand: At Ten Thousand, another one of Crescent Heights’ highrise developments in Los Angeles, the development’s website highlights “Signature Views from the Pacific Ocean to the Hollywood Hills,” supported by imagery showcasing views in every direction. ► Landmark: On the website for Landmark in West Los Angeles, the first listed feature is “Unparalleled Ocean, City and Mountain Views” followed by “Expansive Balconies for Indoor/Outdoor Living.”
► Alloy: The newest high-rise in the Los Angeles region, Alloy’s website lists both “Floor-to-Ceiling Windows” and “Panoramic Views of Los Angeles” as key amenities.
► Vision on Wilshire: This property promotes “Panoramic Possibilities” and “magnificent views from almost anywhere you look.”
These examples demonstrate that views are not simply aesthetic enhancements, but rather are central to the market appeal and rent structure of high-rise apartment developments. Additionally, as seen in the photo to the right, these units all feature fully transparent floor-to-ceiling windows and balconies also feature transparent guardrails.

IMPLICATIONS OF VIEWS & BALCONIES
Source: Property Websites; RCLCO
South View at Ten Thousand
Views from Living Room/Kitchen at Landmark
8844 Burton Way | 16399.01 | March 20, 2026 | 9
While high-rise construction provides differentiating benefits, it also requires substantially higher development costs compared to mid-rise or low-rise alternatives. As a result, high-rise project feasibility is often highly sensitive to relatively small changes in income assumptions. Further, the increased costs of high-rise construction are usually only supportable with increased rents generated by the construction type, some of which can be attributed to views.

Any factor that negatively impacts achievable rents can have a disproportionate effect on project feasibility.

In this case, the city’s requirement to use opaque materials for half of the units, specifically those on the south side of the building, has no meaningful impact on construction cost, but it does significantly affect revenue potential.

The partial loss of views in these units undermines a key attribute that supports the projected rents for those units. Prospective tenants would easily perceive the difference within the building; touring a north-facing unit would showcase expansive views and glass guardrails, while units across the hall would present a different experience. All else being equal, those units are expected to lease at lower rents, directly reducing the project’s overall net operating income and yield on cost, the key metric used to determine financial feasibility.

IMPLICATIONS OF VIEWS & BALCONIES
Source: Client; RCLCO
Rendering of Living Room Views with Transparent and Opaque Balconies at 8844 Burton Way 8844 Burton Way | 16399.01 | March 20, 2026 | 10

IMPACT OF VIEWS & BALCONIES ON ACHIEVABLE RENTS
Source: CoStar; RCLCO
RCLCO’s analysis suggests units without clear views and floor-to-ceiling windows could be discounted by up to 25%.

It is difficult to assess the exact premium or discount attributed to transparent balconies, particularly because all comparable high-rise apartment buildings in Los Angeles have transparent balconies and floor-to-ceiling windows.

To assess this value trade-off, RCLCO examined the pricing relationships between high-rise buildings and mid-rise buildings, with the primary differences being views and floor-to-ceiling windows.
► For this analysis, RCLCO selected three pairs of proximate apartment buildings in Los Angeles; each pair comprised of one high-rise and one mid-rise building, with minimal differences in location, and the properties in each pair share the same developer and were developed at a similar time. ► RCLCO compared the rents between each pair after making adjustments for other differences between the buildings, such as age, unit size, unique features, etc.

These adjustments are an attempt to isolate the impact of views and floor-to-ceiling windows. On average, the mid-rise apartments are priced at a 25% discount to their high-rise counterparts after these adjustments. ► If we assume all of the difference in rents are due to impacted views and natural light, then the units with opaque balconies could achieve rents that are 25% lower than units with transparent balconies.
» These results are consistent with the experience of Client, where units in their buildings without views are priced 25% below units with expansive views and natural light.

Mid-Rise Adjusted Discount to Paired High-Rise
-27%
-25% -24%
-25%
-30%
-25%
-20%
-15%
-10%
-5%
0%
Atelier / Eighth & Grand AVEN / WREN ARQ / VOX Average
8844 Burton Way | 16399.01 | March 20, 2026 | 11
Financial Analysis
8844 Burton Way | 16399.01 | March 20, 2026 | 12

FINANCIAL MODEL
*Reduces the rents for units with opaque balconies by 25%. **Expense ratio increases by about 5% for the opaque balcony scenario as fixed expenses remain constant but variable expenses (e.g., property management) decrease based on the decline in rents. ***Lenders typically require a Debt Service Coverage Ratio (DSCR) of at least 1.15x.

Source: Client; RCLCO

TRANSPARENT

BALCONIES OPAQUE BALCONIES

CONSTRUCTION COSTS
Land Cost $150,000 /unit $30,000,000 $30,000,000
Hard Cost $755 /NSF $232,612,480 $232,612,480
Soft Cost 25% of Hard Costs $58,153,120 $58,153,120
Financing Cost 12% of Land/Hard/Soft Costs $38,491,872 $38,491,872 Total $359,257,472 $359,257,472
RENTS Units Avg. SF Avg. Rent Avg. Rent
North Facing Market-Rate Units 89 1,646 $14,500 $14,500 South Facing Market-Rate Units* 89 1,646 $14,500 $10,875 Affordable Units 22 687 $1,102 $1,102
Total 200 308,096 $13,026 $11,413

OPERATIONS
Gross Potential Rent $31,262,808 $27,391,308
Other Income 2% $625,256 $547,826
Gross Potential Income $31,888,064 $27,939,134
Vacancy 5% ($1,594,403) ($1,396,957)
Net Effective Income $30,293,661 $26,542,177
Operating Expenses** 40% ($12,117,464) ($12,004,920)
Net Operating Income $18,176,197 $14,537,258
DEBT
Total Project Cost (from Above) $359,257,472 $359,257,472 Debt (80% Loan-to-Cost) $287,405,978 $287,405,978
Interest (5.5%) $15,807,329 $15,807,329
NOI (from Above) $18,176,197 $14,537,258
DSCR*** 1.15x 0.92x
8844 Burton Way | 16399.01 | March 20, 2026 | 13

FINANCIAL FEASIBILITY
Source: Client; RCLCO
RCLCO arrived at Total Development Cost and Net Operating Income figures given the assumptions presented on the previous page. We assume that most of the categories/line items related to development costs and operating expenses presented in this analysis hold true in each development scenario, with the exception of several variable line items (rents and variable operating expenses).

To assess the financial feasibility of each development scenario, we employed a commonly-used industry metric—yield on cost—to measure the return on total development cost in each scenario. Yield on cost is calculated by dividing the stabilized net operating income (gross rental and other income, less vacancy and operating expenses) by the total development cost (the sum of land acquisition costs, hard costs, soft costs, and financing costs). Investors and lenders typically require a yield on cost equal to the market capitalization rate (“cap rate”) plus a spread to reflect the developer’s risk. The spread is typically 100 basis points for multifamily apartments. Based on recent transactions and historical relationships between properties in Beverly Hills and the broader Los Angeles region, the market cap rate for a high-rise apartment development in Beverly Hills is assumed to be 4.00%. Given this cap rate, plus 100 basis points, the target yield on cost for this project would be 5.00%.

Given these assumptions, the planned development with transparent balconies is financially feasible while the scenario with opaque balconies on the southfacing units is not financially feasible.

Summary of Investment Feasibility (Yield on Cost)
8844 Burton Way; Beverly Hills, California

TRANSPARENT

BALCONIES
OPAQUE

CRITICAL ASSUMPTIONS
Our conclusions are based on our analysis of the information available from our own sources and from the client as of the date of this report. We assume that the information is correct, complete, and reliable.

We made certain assumptions about the future performance of the global, national, and local economy and real estate market, and on other factors similarly outside either our control or that of the client. We analyzed trends and the information available to us in drawing these conclusions. However, given the fluid and dynamic nature of the economy and real estate markets, as well as the uncertainty surrounding particularly the near-term future, it is critical to monitor the economy and markets continuously and to revisit the aforementioned conclusions periodically to ensure that they are reflective of changing market conditions.

It is important to recognize that stable and moderate growth patterns are historically not sustainable over extended periods of time, the economy is cyclical, and real estate markets are typically highly sensitive to business cycles. Further, it is very difficult to predict when inflection points in economic and real cycles will occur.

With the above in mind, we assume that the long-term average absorption rates and price changes will be as projected, realizing that most of the time performance will be either above or below said average rates.

Our analysis does not consider the potential impact of future economic shocks on the national and/or local economy, and does not consider the potential benefits from major "booms” that may occur. Similarly, the analysis does not reflect the residual impact on the real estate market and the competitive environment of such a shock or boom. Also, it is important to note that it is difficult to predict changing consumer and market psychology.

As such, we recommend the close monitoring of the economy and the marketplace, and updating this analysis as appropriate.

Further, the project and investment economics should be “stress tested” to ensure that potential fluctuations in revenue and cost assumptions resulting from alternative scenarios regarding the economy and real estate market conditions will not cause failure.

In addition, we assume that the following will occur in accordance with current expectations:
► Economic, employment, and household growth
► Other forecasts of trends and demographic and economic patterns, including consumer confidence levels ► The cost of development and construction
► Tax laws (i.e., property and income tax rates, deductibility of mortgage interest, and so forth) ► Availability and cost of capital and mortgage financing for real estate developers, owners and buyers ► Competitive projects will be developed as planned (active and future) and that a reasonable stream of supply offerings will satisfy real estate demand ► Major public works projects occur and are completed as planned Should any of the above change, this analysis should be updated, with the conclusions reviewed accordingly (and possibly revised). 8844 Burton Way | 16399.01 | March 20, 2026 | 16
Reasonable efforts have been made to ensure that the data contained in this study reflect accurate and timely information and are believed to be reliable. This study is based on estimates, assumptions, and other information developed by RCLCO from its independent research effort, general knowledge of the industry, and consultations with the client and its representatives. No responsibility is assumed for inaccuracies in reporting by the client, its agent, and representatives or in any other data source used in preparing or presenting this study. This report is based on information that to our knowledge was current as of the date of this report, and RCLCO has not undertaken any update of its research effort since such date.

Our report may contain prospective financial information, estimates, or opinions that represent our view of reasonable expectations at a particular time, but such information, estimates, or opinions are not offered as predictions or assurances that a particular level of income or profit will be achieved, that particular events will occur, or that a particular price will be offered or accepted. Actual results achieved during the period covered by our prospective financial analysis may vary from those described in our report, and the variations may be material. Therefore, no warranty or representation is made by RCLCO that any of the projected values or results contained in this study will be achieved.

Possession of this study does not carry with it the right of publication thereof or to use the name of "Robert Charles Lesser & Co." or "RCLCO" in any manner without first obtaining the prior written consent of RCLCO. No abstracting, excerpting, or summarization of this study may be made without first obtaining the prior written consent of RCLCO. This report is not to be used in conjunction with any public or private offering of securities or other similar purpose where it may be relied upon to any degree by any person other than the client without first obtaining the prior written consent of RCLCO. This study may not be used for any purpose other than that for which it is prepared or for which prior written consent has first been obtained from RCLCO.

GENERAL LIMITING CONDITIONS
rclco.com
Exhibit B
Cost Reduction Analysis
8844 Burton Way
Beverly Hills, California
Prepared for 8844 Burton Way, LLC
March 20, 2026
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 2 Since 1967, RCLCO has been the “first call” for real estate developers, investors, the public sector, and non-real estate companies and organizations seeking strategic and tactical advice regarding property investment, planning, and development.

Collaborative and actionable strategy
planning, and operational, portfolio,
and capital consultation to real estate
enterprises.

Customized real estate advisory to
institutional investors built on a legacy
of thought leadership and analytical
rigor.

Where
We Work
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RCLCO Office Location
Larger dot = more engagements
Learn more about RCLCO at RCLCO.com
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 3 Project Director
Derek Wyatt, Managing Director
P: (310) 203-3035 | [email protected]
Project Manager
Philip Carney, Principal
P: (240) 669-5635 | [email protected]
Additional Authors
Nick Ferrante, Senior Associate
Authors
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 4

TABLE OF CONTENTS / OBJECTIVES
► Proposed Project Overview 5
► Parking Dimensions 6
► Balcony Encroachments Into Setbacks 7
► Basement Garage Encroachment Into Setback 8
► Disclaimers 9
8844 Burton Way, LLC (“Client”) is planning the development of a new highrise apartment building at 8844 Burton Way in Beverly Hills, California. Current plans for the project call for a 26-story tower comprising 200 apartment units (including 22 affordable units: 14 extremely low income units and 8 moderate income units) and 316 parking spaces. For the proposed project, Client is requesting three off-menu incentives that “result in identifiable and actual cost reductions, to provide for affordable housing costs, as defined in Section 50052.5 of the Health and Safety Code.”

1. Deviate from required parking stall sizes and drive aisle widths.

2. Allow balconies to encroach into side and front setback areas.

3. Allow basement garage to encroach into front/street side setback without locating garage two feet lower than the grade of the adjacent sidewalk.

Against this background, RCLCO was engaged to provide a third-party expert report analyzing the cost reduction associated with the requested incentives.

Analytical objectives of this report included the following:
► Comparing base-case zoning and code requirements to the proposed incentive-based project design.
► Quantifying the extent to which the requested incentives provide actual and identifiable cost reductions to the proposed project to allow for the provision of affordable housing units.
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 5

PROPOSED PROJECT OVERVIEW
Renderings of Proposed Project
8844 Burton Way, LLC (“Client”) is planning the development of a new high-rise apartment building at 8844 Burton Way in Beverly Hills, California.
► The proposed development is on a 26,779 square foot lot that would yield 308,096 net rentable square feet.
» Balcony area comprises 41,523 square feet.
► The project consists of one high-rise building comprising a total of 200 total units. » The building would include 178 market-rate units.
» Overall, the project would provide 22 affordable dwelling units, representing approximately 11% of the total proposed units.
► The proposed project includes 316 vehicle parking spaces.

Overview of Proposed Project

PROPOSED
Lot Area (SF) 26,779
Net Rentable Square Feet 308,096
Balcony Square Feet 41,523
# of Market-Rate Units 178
# of Affordable Units 22
Total Units 200
Total Vehicle Parking Spaces 316
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 6

COST REDUCTION

PARKING DIMENSIONS
1 Accounts for incremental construction and excavation costs associated with deeper below-grade construction. Assumes a cost of $100 per square foot for the first below-grade parking level, with an 18% cost increase for each additional level Source: 8844 Burton Way, LLC; RCLCO
Deviating from the required parking stall dimensions and drive aisle widths allows the project to reduce the number of subterranean parking levels, lowering overall construction costs, including for the affordable housing units. ► Under existing zoning requirements, parking stalls must measure 9 feet by 19 feet, with a minimum drive aisle width of 26 feet. » The proposed project utilizes parking stall dimensions of 8 feet 6 inches by 18 feet and drive aisle widths ranging from 20 to 22 feet, resulting in a more efficient parking layout and increased parking capacity per level. » These smaller stalls and narrower aisles allow parking to be consolidated from six below-grade levels to three, reducing total below-grade parking area by 73,197 square feet.
► In addition to reducing the number of parking levels and total below-grade square footage, the proposed scenario benefits from lower construction costs, as the required scenario requires deeper excavation and construction, which is more expensive to execute. » Based on cost assumptions derived from comparable subterranean parking projects in Los Angeles County, parking construction costs are assumed at $160 per square foot for the required project and $120 per square foot for the proposed project. ► Applied to the 73,197 square feet of incremental parking area that would be required to achieve compliance, this results in a total cost reduction of $14,526,560. ► Accordingly, the requested deviation from the required parking stall dimensions and aisle widths provides a clear and identifiable reduction in overall parking costs, as well as a reduction in the project’s parking cost per square foot, by improving parking efficiency, reducing the total area allocated to structured parking, and in turn reducing the number of required below grade parking levels. Parking construction represents a significant fixed cost component of the project, and these efficiencies generate meaningful project-wide savings that apply across the full unit mix, including the affordable units, and directly support their inclusion in the development.

Cost Reduction Driven by Requested Parking Space and Aisle Sizes

REQUIRED PROPOSED DIFFERENCE / COST REDUCTION
Parking Space Dimensions 9' x 19' 8'6" x 18' -6" x -1'
Minimum Parking Aisle Widths 26' 20' to 22' -4' to -6'
Levels of Below-Grade Parking 6 3 -3
SF Per Below-Grade Parking Level 23,929 23,459 -470
Below-Grade Parking SF 143,573 70,376 -73,197
Below-Grade Parking Cost / SF $160 $120 -$40
Total Below-Grade Parking Cost $22,971,680 $8,445,120 -$14,526,560 8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 7

COST REDUCTION

BALCONY ENCROACHMENTS INTO SETBACKS
Source: 8844 Burton Way, LLC; RCLCO
Allowing balconies to encroach beyond three feet into setback areas improves feasibility by preserving revenue and reducing per-square-foot costs, supporting the provision of affordable units. ► BHMC §10-3-2811.C allows balconies to encroach no more than three feet into required front and street side yard setbacks under the required scenario. ► The proposed scenario expands allowable balcony encroachments to up to 9 feet 2 inches, increasing total rentable square footage by preserving both interior unit area and balcony space that would otherwise be lost under the required scenario. » This expanded balcony encroachment results in approximately 28,006 additional square feet of rentable area under the proposed scenario relative to the required scenario.
► At a monthly rent of $7.45 per square foot, calculated based on both residential interior and balcony square footage, the additional rentable area supported by the proposed scenario generates approximately $2.5 million in incremental gross potential annual rent, as reflected in the first table below. » This equates to more than $12,500 in additional annual gross rental income per unit relative to the required scenario. ► Furthermore, the additional 28,006 square feet of rentable area under the proposed scenario leads to a reduction in construction costs on a per square foot basis, as reflected in the second table below.
» This equates to a cost reduction of $49 per square foot in the proposed scenario relative to the required scenario. ► Accordingly, the requested allowance for balconies to encroach into the required side and front setback areas provides an actual and identifiable financial benefit to the project by increasing total rentable residential and balcony area. This expansion of rentable area directly increases gross potential rent and overall project revenue without increasing land area or base density. Similarly, the additional square footage in the proposed scenario reduces construction costs on a per square foot basis. The resulting incremental revenue and per-square-foot cost reduction create additional capacity to help offset the costs associated with delivering affordable housing units and directly support their inclusion within the project.

Rent Increase Driven by Proposed Balcony Setback Encroachment

KEY ASSUMPTIONS REQUIRED PROPOSED DIFFERENCE / RENT INCREASE Residential + Balcony SF 321,613 349,619 28,006
Monthly Rent / Resi + Balcony SF $7.45 $7.45 $0.00
Gross Potential Annual Rent $28,758,494 $31,262,808 $2,504,314

KEY ASSUMPTIONS REQUIRED PROPOSED DIFFERENCE / COST REDUCTION Residential + Balcony SF 321,613 349,619 28,006
Estimated Total Construction Costs $346,214,039 $359,257,472 Construction Cost Per Square Foot $1,076 / SF $1,028 / SF -$49 / SF Per-Square-Foot Cost Reduction Driven by Proposed Balcony Setback Encroachment 8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 8

COST REDUCTION

BASEMENT GARAGE ENCROACHMENT INTO SETBACK
Source: Caltrans; 8844 Burton Way, LLC; RCLCO
Allowing the basement garage to encroach into front and street-side yard setbacks without locating the garage two feet below the adjacent sidewalk grade reduces total construction costs, including for the affordable housing units. ► BHMC §10-3-2811.E allows basement garages to encroach into required front and street-side yard setbacks provided the garage is located a minimum of two feet below the adjacent sidewalk grade.
► Under the proposed scenario, the basement garage is located approximately 6 feet 10 inches above the adjacent sidewalk grade, meaning it is 8 feet 10 inches higher than the required scenario while still encroaching into the required front and street-side setbacks. This reduced depth significantly decreases the amount of excavation required.
► The 8 feet 10 inches difference in garage depth, applied across a below-grade parking floorplate of 24,399 square feet, results in approximately 215,524 cubic feet (7,982 cubic yards) less excavation under the proposed scenario relative to the required scenario. ► At an assumed site excavation cost of $132 per cubic yard, the reduced excavation depth under the proposed scenario would lower excavation costs by approximately $1.05 million.
► Accordingly, the requested allowance for the basement garage to encroach into the required front and street side setbacks without being lowered two feet below the adjacent sidewalk grade provides an actual and identifiable reduction in development costs by materially reducing required site and parking excavation.

Because excavation and below grade parking construction represent significant fixed cost components of the project, this modification directly reduces those baseline costs. The resulting savings lower overall project expenditures and directly support the financial feasibility of including the proposed affordable housing units within the development.

Cost Reduction Driven by Proposed Garage Depth

REQUIRED PROPOSED DIFFERENCE / COST REDUCTION
Below-Grade Parking Cost $8,445,120 $8,445,120 $0
P1 Depth (Relative to Grade) -2’ +6’ 10” +8’ 10”
Below-Grade Floorplate SF 24,399 24,399 0
Cubic Feet to be Excavated 215,524 0 -215,524
Cubic Yards to be Excavated 7,982 0 -7,982
Site Excavation Cost Per Cubic Yard $132 $132 $0
Total Added Excavation Cost $1,051,000 $0 -$1,051,000
Total Below-Grade Parking Cost $9,496,120 $8,445,120 -$1,051,000 8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 9 Disclaimers
8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 10

As such, we recommend the close monitoring of the economy and the marketplace, and updating this analysis as appropriate.

In addition, we assume that the following will occur in accordance with current expectations:
► Economic, employment, and household growth
► Other forecasts of trends and demographic and economic patterns, including consumer confidence levels ► The cost of development and construction
► Tax laws (i.e., property and income tax rates, deductibility of mortgage interest, and so forth) ► Availability and cost of capital and mortgage financing for real estate developers, owners and buyers ► Competitive projects will be developed as planned (active and future) and that a reasonable stream of supply offerings will satisfy real estate demand ► Major public works projects occur and are completed as planned Should any of the above change, this analysis should be updated, with the conclusions reviewed accordingly (and possibly revised). 8844 Burton Way Cost Reduction Analysis | 16399.01 | March 20, 2026 | 11 Reasonable efforts have been made to ensure that the data contained in this study reflect accurate and timely information and are believed to be reliable. This study is based on estimates, assumptions, and other information developed by RCLCO from its independent research effort, general knowledge of the industry, and consultations with the client and its representatives. No responsibility is assumed for inaccuracies in reporting by the client, its agent, and representatives or in any other data source used in preparing or presenting this study. This report is based on information that to our knowledge was current as of the date of this report, and RCLCO has not undertaken any update of its research effort since such date.

GENERAL LIMITING CONDITIONS
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Exhibit C

1. MAX HEIGHT IN ZONING CODE
Waiver of maximum stories and height in zoning code
Loss of 174 units.

MAX BUILDING HEIGHT PER CODE PROPOSED

8.7 UNITS PER FLOOR AVERAGE
200 UNITS TOTAL

8.7 UNITS PER FLOOR AVERAGE
26 UNITS TOTAL

3. SETBACKS AND ENCROACHMENTS
Waiver of setbacks and permissible encroachments
Loss of 1.5 units per floor = 32 units total.

5. OPEN SPACE
Reduction of required amount of usable outdoor living space required for each unit
Loss of 2 units per floor = 42 units total.

6. SETBACK ALONG BURTON WAY
Reduction of required setback along Burton Way
Loss of 1 units per floor = 21 units total.

7. MODULATION
Waiver of front building modulation
Modulation required per BHMC §10-3-2806(C) = 4% Aggregate Principal Building Area (or 1,500 sf, whichever is less)
Aggregate Principal Building Area = 16,928 sf x 26 = 440,128 sf 4% x 440,128 sf = 17,605 sf > 1,500 sf
1,500 sf Area of Modulation Required
Loss of 1 unit.

8. MODULATION
Waiver of modulation requirements for a Large Scale Multiple Residential Development
Additional Modulation Required per BHMC §10-3-2806(E) = Width of Principal Building Area x 5 ft x Stories = 198 ft x 5 ft x 26 stories
= 25,740 sf of Additional Modulation Required
= 990 sf of Modulation per floor
Loss of 2 unit per floor = 42 units total.

10. SETBACK ALONG ALLEY
Reduction of rear setback requirement
Loss of 1 unit per floor = 21 units total.

11. BUILDING LENGTH
Waiver of requirement that if building exceeds maximum length then portions of building above ground will be considered separate buildings (BHMC § 10-3-2809) Loss of 2 units per floor = 42 units total.

12. MAX HEIGHT IN GENERAL PLAN
Waiver of maximum height requirements in general plan

MAX BUILDING HEIGHT PER CODE PROPOSED
35 UNITS TOTAL
Loss of 165 units.
200 UNITS TOTAL

8.7 UNITS PER FLOOR AVERAGE 8.7 UNITS PER FLOOR AVERAGE

Beverly Hills City CouncilMarch 24, 2026

Beverly Hills City Council
March 24, 2026