MEMORANDUM OF UNDERSTANDING
BETWEEN THE CITY OF COTATI AND SOUTHROCK VENTURES, LLC
This MEMORANDUM OF UNDERSTANDING (this “MOU”) is entered into as of January ____, 2026 by and among SOUTHROCK VENTURES, LLC, a Wyoming limited liability company, its successors and assigns (referred to herein as the “Developer” and sometimes “SouthRock”) and CITY OF COTATI, a California municipality (referred to herein as the “City”). The City and SouthRock (each a “Party” and together the “Parties”) acknowledge that the purpose of this MOU is to outline the salient business points between the Parties and memorialize the same in a Development Project Application (the “Application”) submitted by the Developer to the City, all as more particularly set forth below:
WHEREAS the Developer entered into a binding purchase agreement April 20, 2023 with Colvin Group Fund I LP (the “Seller”) to acquire four (4) vacant parcels totaling approximately 2.77 acres (the “Colvin Parcels”) at the time zoned Santero Way Specific Plan (“SWSP”), fully entitled for construction of up to ninety-eight (98) multifamily apartments within three (3) buildings, each three (3) levels high, and 5,587 square feet of commercial space, and conditions of approval from the City that included the development of a new public park on the Colvin Parcels, as well as requiring improvements to the adjoining vacant and undeveloped parcel owned by the City totaling 0.56 acres [24,395 square feet] (the “City Parcel” together with the Colvin Parcels are hereafter referred to as the “Project Site”) by way of a Public Improvement Agreement for use as a 32-stall overflow public parking lot (the fully entitled Project Site for up to 98 residential units is hereafter referred to as the “98-Unit Project”); WHEREAS the City initiated the process of updating the SWSP, and in February 2025 formally approved a variety of changes which pivoted the SWSP from an office-focused, medium density residential development to a mixed-use, high density, transit-oriented neighborhood (the “Updated SWSP”);
WHEREAS the Developer is proposing to construct approximately 170 multifamily apartments, 13,249 square feet of conditioned residential amenity spaces, 17,759 square feet of retail and office uses, and a 9,105 square feet active public space fronting a ground-level retail plaza by making the following changes to the 98-Unit Project: (i) removing the overflow public parking lot, (ii) reducing the size of the new community park fronting the intersection of Depot Way and Santero Way oriented towards the Cotati SMART Station, (iii) increasing the building height to four (4) levels for all buildings, and (iv) adding an additional building for a total of four (4) buildings within the Project Site (the “170-Unit Project”); WHEREAS the City has advised the Developer that the 170-Unit Project will trigger the need for a new Application and plan approval process, which subsequently requires the City and Developer to negotiate new agreements and approvals such as an Affordable Housing Regulatory Agreement, Development Impact Fee Deferral and Grant Agreement, Subdivision of Property Docusign Envelope ID: 979CE45B-4FC0-42DA-B902-B928DEEAB4CB 282 of 387
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and/or Lot Line Adjustment, Public Improvement Agreement(s), Use Permit(s) and various easements throughout the Project Site and an agreement where the City would convey the City Parcel to the Developer to be included in the Application within the Project Site for the 170- Unit Project in exchange for meeting the terms and conditions set forth herein (the “New Entitlements”);
WHEREAS the Developer desires clarity and a level of understanding from the City with regards to the City Parcel and the terms in which it will be conveyed to the Developer at the same time as the New Entitlements prior to the Developer committing additional capital towards 3
rd party costs required to complete a new Application and formal planning process; WHEREAS in July 2025 the City approved a resolution declaring the City Parcel as surplus property stating in part, “that the remainder of the City owned property would be best utilized to implement the community vision of the SWSP through the sale or exchange of property to allow contiguous complementary uses adjacent to the train station, as described and permitted in the SWSP.”;
WHEREAS in July 2025 the City simultaneously commissioned a 3rd party appraisal that estimated the City Parcel to have a fair market value of $450,000 (the “City Parcel Value”);
WHEREAS the Developer shall provide additional improvements desired by the City with a value equal or greater to the City Parcel Value, less any area improved for Public Rightof-Way, at an estimated pro rata rate equal to $18.45 per square foot (the “Pro Rata Exchange Rate”) that shall be confirmed by survey in and subject to the New Entitlements for the 170-Unit Project (the net area of the City Parcel is referred to as the “Net City Parcel” and the Pro Rata Exchange Rate multiplied by the Net City Parcel square feet is hereinafter referred to as the “Net Exchange Consideration”);
WHEREAS the existing purchase agreement between SouthRock and Colvin will not progress to a closing until New Entitlements are approved by the City; WHEREAS the Developer will not submit the Application until a clear path to control of the City Parcel is determined, negotiated, and conditionally acceptable to the Parties.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS in consideration of the mutual covenants and agreements set forth in this MOU, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
1. As part of the 170-Unit Project, the Developer shall complete offsite construction improvements desired by the City, beyond those required as a condition of approval for Docusign Envelope ID: 979CE45B-4FC0-42DA-B902-B928DEEAB4CB 283 of 387
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the 170-Unit Project, that collectively cost an amount equal to or greater than the Net Exchange Consideration to construct (the “Offsite Program”).
2. The City and Developer agree to negotiate in good faith to determine which offsite improvements are appropriate to be considered credit for the Developer towards the Net Exchange Consideration (the “Qualified Improvements”).
3. This MOU is intended as a non-binding statement of mutual understanding and does not create enforceable obligations. Binding obligations, if any, will be contained in the New Entitlements or a Purchase and Sale Agreement duly authorized by the City and executed by the Parties.
4. This MOU shall remain in effect until the earlier of: (i) binding agreements regarding the conveyance of the City Parcel to the Developer in exchange for the Qualified Improvements (ii) execution of a separate written agreement; or (iii) written notice of termination by either Party.
5. This MOU shall be governed by the laws of the State of California.
6. This MOU may be executed in counterparts, each of which shall be deemed an original.
7. This MOU embodies the entire understanding of the Parties regarding the subject matter herein.
8. The obligations undertaken by each Party pursuant to this MOU shall only be delegated or assigned to any other person or agency with the prior written consent of the other Party.
9. This MOU supersedes all prior or contemporaneous communications and proposals, whether electronic, oral, or written between the Parties with respect to the subject matter hereof. Any amendment or supplement to this MOU must be in writing and executed by the Parties hereto.
IN WITNESS WHEREOF, the Parties have executed this Memorandum of Understanding as of the date set forth below.
SouthRock Ventures, LLC
By: ___________________________
Name: David Byerly
Title: Managing Partner
City of Cotati
By: ___________________________
Name: Damien O’Bid
Title: City Manager
Docusign Envelope ID: 979CE45B-4FC0-42DA-B902-B928DEEAB4CB 284 of 387
Certificate Of Completion
Envelope Id: 979CE45B-4FC0-42DA-B902-B928DEEAB4CB Status: Sent Subject: City of Cotati - SouthRock Ventures, LLC MOU
Source Envelope:
Document Pages: 3 Signatures: 1 Envelope Originator:
Certificate Pages: 5 Initials: 0 Damien O'Bid
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Time Zone: (UTC-08:00) Pacific Time (US & Canada)
[email protected]
IP Address: 71.6.94.254
Record Tracking
Status: Original
12/23/2025 11:36:34 AM
Holder: Damien O'Bid
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: StateLocal
Storage Appliance Status: Connected Pool: Carahsoft OBO City of Cotati Location: Docusign Signer Events Signature Timestamp
David Byerley
[email protected]
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Signed using mobile
Sent: 12/23/2025 11:44:22 AM
Viewed: 12/23/2025 9:54:16 PM
Signed: 12/23/2025 9:54:25 PM
Electronic Record and Signature Disclosure:
Accepted: 12/23/2025 9:54:16 PM
ID: dcb05761-0737-4857-9390-c0591c5ec7f9
Damien O'Bid
[email protected]
City Manager
City of Cotati
Security Level: Email, Account Authentication
(None)
Sent: 12/23/2025 9:54:26 PM
Viewed: 1/7/2026 10:24:22 PM
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Blake Byerley
[email protected]
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Kevin Patterson
[email protected]
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Envelope Sent Hashed/Encrypted 12/23/2025 11:44:22 AM
Certified Delivered Security Checked 1/7/2026 10:24:22 PM Payment Events Status Timestamps
Electronic Record and Signature Disclosure
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All notices and disclosures will be sent to you electronically Electronic Record and Signature Disclosure created on: 12/20/2021 3:35:42 PM Parties agreed to: David Byerley
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Santero Way Surplus Property Location
This map is a user generated static output from an Internet mapping site and is for reference only. Data layers that appear on this map may or may not be accurate, current, or otherwise reliable.
0.2 THIS MAP IS NOT TO BE USED FOR NAVIGATION
0 0.08 0.15Miles
1: 4,800 6/28/2025
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APPRAISAL OF:
Depot Way
Cotati, CA 94931
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122 Calistoga Road, #364
Santa Rosa, CA 95409
(707) 575-7778
[email protected]
July 9, 2025
Mr. Damien O'Bid
City Manager
City of Cotati
PO Box 428
Cotati, CA 94931
RE: A Vacant 0.56 Gross Acre Site
Depot Way
Cotati, CA 94931
Dear Mr. O'Bid:
As requested by you, we have prepared an appraisal of the market value of the above referenced property. Our reasoning and analysis are presented in the following Appraisal Report.
The subject is a vacant 0.56 gross acre site located along Depot Way in Cotati, California. The subject's nominal developable area is diminished slightly by the fact that a portion of it is designated in the Santero Way Station Area Specific Plan for future dedication as access rightof-way. However, in Cotati density is based on gross site area and so this would not affect the number of units which could ultimately be approved for development. In addition, while the subject is currently zoned Santero Way, it is imminently to be re-zoned to Transit-Oriented Communities. The two zonings are very similar, and according to city officials a development proposal in accordance with either zoning would be permissible as of the date of valuation. The subject is more fully described in the enclosed report.
Based upon the research and analysis contained in the following report, the market value of the subject is concluded as follows:
Value Conclusions
Date Value Perspective Interest Appraised Value
July 1, 2025 Current Fee Simple $450,000
Valuation Scenarios
Market Value
The appraisal is subject to the Statement of Assumptions and Limiting Conditions and Certifications set forth in this report, as well as the following Extraordinary Assumptions and Hypothetical Conditions:
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122 Calistoga Road, #364
Santa Rosa, CA 95409
(707) 575-7778
[email protected]
No Preliminary Title Report was provided. The value opinion set forth in this appraisal report is subject to and conditioned upon the absence of any easements or encumbrances that would materially affect the subject's market value. The use of this extraordinary assumption may have affected assignment results.
None
Extraordinary Assumptions
Hypothetical Conditions
This letter and related exhibits must remain attached to the report in order for the value opinion set forth to be considered valid.
The appraisal that follows is a narrative appraisal report that sets forth the scope of the assignment, identification of the property, pertinent facts about the area and the subject property, comparable data, the results of the research and analyses and the reasoning leading to the conclusions set forth. The appraisal report has been prepared in conformance with our understanding of the Uniform Standards for Professional Appraisal Practice (USPAP) and the requirements of the Code of Professional Ethics and Standards of the Professional Appraisal Practice of the Appraisal Institute. It also conforms to the Title XI Regulations and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) updated in 1994 and further updated by the Interagency Appraisal and Evaluation Guidelines promulgated in 2010.
Respectfully submitted,
Robert A. Horning, MAI
California Certified General Appraiser
BREA License Number AG028396
Expiration: October 18, 2025
Ryan C. Ward, MAI
California Certified General Appraiser
BREA License Number AG026338
Expiration: December 22, 2026
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TABLE OF CONTENTS
AERIAL PHOTOGRAPH..................................................................................................................... 1 SUBJECT PROPERTY PHOTOGRAPHS............................................................................................... 2 EXECUTIVE SUMMARY .................................................................................................................... 4 IDENTIFICATION OF THE PROPERTY................................................................................................ 5 SCOPE OF WORK ............................................................................................................................. 6 STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS ........................................................ 9 DEFINITIONS.................................................................................................................................. 14 REGIONAL MAP............................................................................................................................. 17 COUNTY MAP................................................................................................................................ 18 CITY MAP....................................................................................................................................... 19 AREA ANALYSIS ............................................................................................................................. 20 THE ECONOMY, INFLATION, INTEREST RATES & CAP RATES........................................................ 26 NEIGHBORHOOD MAP.................................................................................................................. 29 NEIGHBORHOOD ANALYSIS .......................................................................................................... 30 SITE ANALYSIS ............................................................................................................................... 33 ZONING ANALYSIS......................................................................................................................... 36 HIGHEST AND BEST USE................................................................................................................ 40 APPRAISAL PROCESS ..................................................................................................................... 42 LAND VALUATION ......................................................................................................................... 44 CERTIFICATION OF ROBERT A. HORNING, MAI............................................................................. 64 CERTIFICATION OF RYAN C. WARD, MAI ...................................................................................... 65 QUALIFICATIONS OF ROBERT A. HORNING, MAI.......................................................................... 66 QUALIFICATIONS OF RYAN C. WARD, MAI.................................................................................... 67
ADDENDA
Flood Determination
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AERIAL PHOTOGRAPH
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SUBJECT PROPERTY PHOTOGRAPHS
View Northeast Along Depot Way (Subject To Right) View South Along Santero Way View Northwest Along Depot Way (Subject To Left) View Southeast Toward Terminus Of Depot Way Train Station Immediately Northeast Of Subject View South From North Boundary 296 of 387
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View West From East Portion View North From South Portion View Northeast From Southwest Portion
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EXECUTIVE SUMMARY
Property Type / Sub-Type
Address
City, State, Zip
County
Census Tract
Geocode
Number of Parcels 1
Assessor's Parcel Number 144-320-033
Total Land Area Acres Square Feet
Gross 0.56 24,394
Usable 0.56 24,394
General Plan Designation
Zoning
Shape Irregular
Topography Level
Flood Zone X (Flood Insurance is not required)
Panel # 06097C0879E
Panel Date 12/2/2008
Improvements
As Vacant
Exposure Time 6 to 12 months
Marketing Time 6 to 12 months
Property Identification
Site
Land - Mixed Use
Depot Way
Cotati, CA 94931
Sonoma
1512.03
38.3303594, -122.6909853
Santero Way Station Area Specific Plan
SW - Santero Way
Highest and Best Use
Exposure & Marketing Time
The highest and best use of the subject site as if vacant is considered to be the development of 100% multi-family residential uses or mixed commercial and multifamily residential uses in conjunction with a build-to-suit or pre-lease commitment for the commercial component.
None
Value Conclusions
Date Value Perspective Interest Appraised Value
July 1, 2025 Current Fee Simple $450,000
No Preliminary Title Report was provided. The value opinion set forth in this appraisal report is subject to and conditioned upon the absence of any easements or encumbrances that would materially affect the subject's market value. The use of this extraordinary assumption may have affected assignment results.
None
Extraordinary Assumptions
Valuation Scenarios
Hypothetical Conditions
Market Value
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IDENTIFICATION OF THE PROPERTY
Location, Address and Legal Description
The subject is located along the southwest side of Depot Way, just east of Santero Way and immediately southwest of the Cotati SMART station, in the City of Cotati, County of Sonoma, California. The subject is referred to as Sonoma County Assessor's Parcel Number 144-320-033 and does not have a situs address listed by the Assessor. In this report it has generally been referred to simply with an address of Depot Way, Cotati, Sonoma County, CA 94931.
The subject has been identified by the Assessor's Parcel Number.
Ownership and Recent History of Subject Property
The subject ownership is vested in City of Cotati.
Ward Levy Appraisal Group, Inc. is unaware of any transfers, offers, options or agreements to purchase pending on the subject property within the last three years.
Date of Inspection, Valuation and Report Date
Date of Inspection: July 1, 2025
Date of Value (Effective Date): July 1, 2025
Report Date: July 9, 2025
Extent of the Inspection
Role Name Inspected Extent Date of Inspection
Appraiser Robert A. Horning, MAI Yes On-Site 7/1/2025
Reviewer Ryan C. Ward, MAI Yes On-Site 6/25/2025
Real Property Tax and Assessment Data
The subject is not assessed for ad valorem tax purposes because it is owned by a public agency. 299 of 387
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SCOPE OF WORK
According to the Uniform Standards of Professional Appraisal Practice, it is the appraiser’s responsibility to develop and report a scope of work that results in credible results that are appropriate for the appraisal problem and intended user(s). Therefore, the appraiser must identify and consider:
• the client and intended users;
• the intended use of the report;
• the type and definition of value;
• the effective date of value;
• assignment conditions;
• typical client expectations; and
• typical appraisal work by peers for similar assignments.
Scope of Work
Client: City of Cotati
Intended Use: Assist in developing a sale price, and no other use is permitted.
Intended User: The City of Cotati, and no other user may rely on our report unless specifically indicated in the report.
The appraiser has not identified any purchaser or
borrower as an intended user of this appraisal. Receipt of a copy of the appraisal by such a party or any other third party does not mean that the party is an intended user of the appraisal. Such parties are advised to obtain an
appraisal from an appraiser of their own choosing if they require an appraisal for their own use. This appraisal
report should not serve as the basis for any property
purchase decision or any appraisal contingency in a
purchase agreement relating to the property.
Purpose of the Appraisal: The purpose of this appraisal is to estimate the market value of the subject property. The definition of market value used in this appraisal is as follows:
The most probable price which a property should bring in a competitive and open market under all conditions
requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is
not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions 300 of 387
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whereby:
1. buyer and seller are typically motivated;
2. both parties are well informed or well advised, and
acting in what they consider their own best
interests;
3. a reasonable time is allowed for exposure in the
open market;
4. payment is made in terms of cash in U.S. dollars or
in terms of financial arrangements comparable
thereto; and
5. the price represents the normal consideration for
the property sold unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale.1
Report Type: This is an Appraisal Report as defined by Uniform Standards of Professional Appraisal Practice under
Standards Rule 2-2(a). This format provides a summary of the appraisal process, subject and market data and
valuation analyses.
Property Identification: The subject has been identified by the Assessor's Parcel Number.
Inspection: A complete inspection of the subject property has been made, and photographs taken.
Information Sources: Obtaining the site size from the Assessor's records, researching local area use trends and construction activity from public agencies and local market participants,
determining probable marketing and exposure time based
on recent sales and interviews with local real estate
professionals, conducting telephone, electronic and
personal interviews with persons considered
knowledgeable regarding the subject property and
general market conditions, verifying the comparable
market data with at least one party to the transactions. 1 OCC, 12 CFR, Part 34, Subpart C-Appraisals 34.42 Definitions (g) 301 of 387
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Market Area and Analysis of
Market Conditions: A complete analysis of market conditions has been made.
Highest and Best Use Analysis: A complete as vacant highest and best use analysis for the subject has been made. Legally permissible, physically
possible and financially feasible uses were considered, and the maximally productive use was concluded.
Interest Appraised: Fee Simple
Personal Property, Fixtures and
Intangible Items: The valuation opinion included within this appraisal is for the real property only. No personal property, fixtures or intangible items of material value are included as part of the real property.
Valuation Analyses
Cost Approach: A cost approach was not applied as there are no improvements to analyze.
Sales Comparison Approach: A sales approach was applied as market participants consider similar type properties when determining the
subject's market value and thus the Sales Comparison
Approach is utilized in the analysis.
Income Approach: An income approach was not applied as the subject is not a typical income producing property.
Extraordinary Assumptions and Hypothetical Conditions
No Preliminary Title Report was provided. The value opinion set forth in this appraisal report is subject to and conditioned upon the absence of any easements or encumbrances that would materially affect the subject's market value. The use of this extraordinary assumption may have affected assignment results.
None
Extraordinary Assumptions
Hypothetical Conditions
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STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal is for no purpose other than property valuation, and the appraisers are neither qualified to nor attempting to go beyond that narrow scope. The reader should be aware that there are inherent limitations to the accuracy of the information and analyses contained in this appraisal. Before making any decision based on the information and analyses contained in this report, it is critically important to read this entire section to understand these limitations.
Please note that all of the following assumptions and limiting conditions are considered to be effective unless otherwise noted within this report.
1. Appraisal is not a Survey: It is assumed that the utilization of the land and improvements is within the boundaries of the property lines of the property described and that there is no encroachment or trespass unless noted within the report.
2. No survey of the property has been made by the appraisers and no responsibility is assumed in connection with such matters. Any maps, plats or drawings reproduced and included in this report are intended only for the purpose of showing spatial relationships.
The reliability of the information contained on any such map or drawing is assumed by the appraisers and cannot be guaranteed to be correct. A surveyor should be consulted if there is any concern on boundaries, setbacks, encroachments or other survey matters.
3. Appraisal is not a Legal Opinion: No responsibility is assumed for legal matters that affect title to the property nor is an opinion of title rendered. The title is assumed to be good and marketable. The value estimate is given without regard to any questions of title, boundaries, encumbrances or encroachments. We are not usually provided a complete title report of the property being appraised and, in any event, we neither made a detailed examination of it nor do we give any legal opinion concerning it.
4. It is assumed that there is full compliance with all applicable federal, state and local environmental regulations and laws, unless non-compliance is stated, defined and considered in the appraisal report. A comprehensive examination of laws and regulations affecting the subject property was not performed for this appraisal.
5. Unless stated herein, the property is assumed to be outside of areas where flood hazard insurance is mandatory. Maps used by public and private agencies to determine these areas are limited with respect to accuracy. Due diligence has been exercised in interpreting these maps, but no responsibility is assumed for misinterpretation.
6. It is assumed that all applicable zoning and land use regulations and restrictions have been complied with, unless a non-conformity has been stated, defined and considered in the appraisal report. Information and analyses shown in this report concerning these items are based only on a preliminary investigation. Any significant question should be addressed to local zoning or land use officials and/or an attorney.
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contained in this report is based. Appropriate government officials and/or an attorney should be consulted if an interested party has any questions or concerns on these items, inasmuch as we have not made a comprehensive examination of laws and regulations affecting the subject property.
8. Appraisal is not an Engineering or Property Inspection Report: This appraisal should not be considered a report on the physical items that are a part of this property. Although the appraisal may contain information about the physical items being appraised (including their adequacy and/or condition), it should be clearly understood that this information is only to be used as a general guide for property valuation and not as a complete or detailed physical report. The appraisers are not construction, engineering, environmental or legal experts, and any statement given on these matters in this report should be considered preliminary in nature.
9. If the subject property is improved with structures, the observed condition of the foundation, roof, exterior walls, interior walls, floors, heating system, plumbing, insulation, electrical service and all mechanical and construction are based on casual inspection only and no detailed inspection was made. The structures were not checked for building code violations, and it is assumed that all buildings meet applicable building codes unless so stated in the report.
10. It is assumed that there are no hidden or unapparent conditions of the property, sub-soil or structures that would render it more or less valuable. No responsibility is assumed for such conditions, nor for the engineering that may be required to discover such factors.
Since no engineering or percolation tests were made, no liability is assumed for soil conditions. Sub-surface rights (mineral and oil) were not considered in making this appraisal.
11. We are not environmental experts, and we do not have the expertise necessary to determine the existence of environmental hazards such as the presence of ureaformaldehyde foam insulation, toxic waste, asbestos or hazardous building materials, or any other environmental hazards on the subject or surrounding properties. If we know of any problems of this nature which we believe would create a significant problem, they are disclosed in the report. Nondisclosure should not be taken as an indication that such a problem does not exist, however. An expert in the field should be consulted if any interested party has questions on environmental factors.
12. We are not biologists, hydrologists or wetlands specialists and we do not have the expertise necessary to determine the existence of wetlands, protected plant species or endangered animals that may be present on the subject property. If we know of any problems of this nature which we believe would create a significant problem or impact value, they are disclosed in the report. Nondisclosure should not be taken as an indication that such issues do not exist, however. An expert in the field should be consulted if any interested party has questions on these matters.
13. No chemical or scientific tests were performed by the appraisers on the subject property, and it is assumed that the air, water, ground and general environment associated with the 304 of 387 Depot Way, Cotati
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property present no physical or health hazard of any kind unless otherwise noted in the report. It is further assumed that the property does not contain any type of dump site and that there are no underground tanks (or any underground source) leaking toxic or hazardous chemicals into the groundwater or the environment unless otherwise noted in the report.
14. Because no detailed inspection was made, and because such knowledge goes beyond the scope of this appraisal, any condition or other comments given in this appraisal report should not be taken as a guarantee that a problem does not exist. Specifically, no guarantee is made as to the adequacy or condition of the foundation, roof, exterior walls, interior walls, flooring, heating system, air conditioning system, plumbing, electrical service, insulation or any other components of buildings or structures that are located on the land. If any interested party is concerned about the existence, condition or adequacy of any particular item, we would strongly suggest that a construction expert be hired for a detailed investigation.
15. Appraisal is Made Under Conditions of Uncertainty with Limited Data: As can be seen from the limitations presented above, this appraisal has been performed with a limited amount of data. Data limitations result from a lack of certain areas of expertise by the appraisers (that go beyond the scope of the ordinary knowledge of an appraiser), the inability of the appraisers to view certain portions of the property and the inherent limitations of relying upon information provided by others. We have spent our time and effort in the investigative stage of this appraisal in those areas where we think it will do the most good, but inevitably there is a significant possibility that we do not possess all information relevant to the subject property.
16. Information provided by local sources, such as government agencies, financial institutions, accountants, attorneys and others is assumed to be true, correct and reliable. No responsibility for the accuracy of such information is assumed by the appraisers.
17. The comparable sales data relied upon in the appraisal is believed to be from reliable sources. Though all of the comparable sales were examined, it was not possible to inspect them all in detail. The value conclusions are subject to the accuracy of said data.
18. Engineering analyses of the subject property were neither provided for use nor made as a part of this appraisal contract. Any representation as to the suitability of the property for uses suggested in this analysis is therefore based only on a preliminary investigation by the appraisers and the value conclusions are subject to said limitations.
19. All values shown in the appraisal report are projections based on our analyses as of the date of the appraisal. These values may not be valid in other time periods or as conditions change. We take no responsibility for events, conditions or circumstances affecting the property's market value that take place subsequent to either the date of value contained in this report or the date of our field inspection, whichever occurs first. 305 of 387
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20. Since projected mathematical models and other projections are based on estimates and assumptions which are inherently subject to uncertainty and variation depending upon evolving events, we do not represent them as results that will actually be achieved.
21. This appraisal is an estimate of value based on an analyses of information known to us at the time the appraisal was made. We do not assume any responsibility for incorrect analyses because of erroneous or incomplete information. If new information of significance comes to light, the value estimates are subject to change without notice.
22. Opinions and estimates expressed herein represent our best judgment, but should not be construed as advice or a recommendation to act. Any actions taken by you, the client, or any others should be based on your own judgment, and the decision process should consider many factors in addition to the value estimates and information given in this report.
23. Appraisal reports are technical documents addressed to the specific technical needs of clients. Casual readers should understand that this report does not contain all of the information we have concerning the subject property or the real estate market.
24. This appraisal was prepared at the request of and for the exclusive use of the client to whom the appraisal is addressed. No third party shall have any right to use or rely upon this appraisal for any purpose.
25. There are no requirements, by reason of this appraisal, to give testimony or appear in court or any pretrial conference or appearance required by subpoena with reference to the property in question, unless agreed to previously by the appraiser, sufficient notice is given to allow adequate preparation and additional fees are paid by the client at our regular rates for such appearances and the preparation necessitated thereby.
26. This report is made for the information and/or guidance of the client, and possession of this report, or a copy thereof, does not carry with it a right of publication. Neither all nor any part of the contents of this report shall be conveyed to the public through advertising, public relations, news, sales or other media without the written consent and approval of the appraisers. Nor shall the appraisers, firm or professional organization of which the appraisers are members be identified without the written consent of Ward Levy Appraisal Group, Inc.
27. It is suggested that those who possess this appraisal report should not give copies to others. Legal advice should be obtained on potential liability issues before this is done.
Anyone who gives out an incomplete or altered copy of the appraisal report (including all attachments), does so at his/her own risk and assumes complete liability for any harm caused by giving out an incomplete or altered copy. Neither the appraisers nor Ward Levy Appraisal Group, Inc. assumes any liability for harm caused by reliance upon an incomplete or altered copy of the appraisal report given out by others. 306 of 387
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28. Values and conclusions for various components of the subject property as contained within this report are valid only when making a summation; they are not to be used independently for any purpose and must be considered invalid if so used.
29. The Americans with Disabilities Act became effective January 26, 1992. Ward Levy Appraisal Group, Inc. has not made a specific compliance survey and analysis of the subject property to determine whether or not any improvements which are located on the land conform with the detailed requirements of the Act. It is possible that a compliance survey of the property could reveal that some or all of the improvements are not in compliance with one or more of the requirements of the Act. If so, this fact could have a negative effect upon the value of the property. Since we have no direct evidence relating to this issue, we did not consider possible non-compliance with the requirements of the Act in estimating the value of the property.
30. The Insurable Replacement Cost information and estimate of the appraisers should not be considered a reliable indication of replacement or reproduction cost due to the changing costs of labor and materials. The Insurable Replacement Cost information and estimate of the appraisers cannot be relied upon with regard to the actual cost to reproduce or replace any existing improvements due to changing building codes and governmental regulations and requirements.
31. Provision of an Insurable Replacement Cost estimate by the appraisers does not change the intended purpose of the appraisal. The appraisers assume no liability for the Insurable Replacement Cost estimate provided and do not guarantee that any estimate or opinion will result in the subject property being fully insured for any possible loss that may be sustained. The appraisers recommend that an insurance professional be consulted to determine the appropriate type and amount of insurance to be placed on the subject premises.
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DEFINITIONS
The following definitions have been taken from The Dictionary of Real Estate Appraisal, Seventh Edition (2022). Clarifications and modifications have been performed, to enhance clarity.
As Is Market Value: The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date. (Interagency Appraisal and Evaluation Guidelines) Note that the use of the “as is” phrase is specific to appraisal regulations pursuant to FIRREA applying to appraisals prepared for regulated lenders in the United States. The concept of an “as is” value is not included in the Standards of Valuation Practice of the Appraisal Institute, Uniform Standards of Professional Appraisal Practice, or International Valuation Standards.
Cash-Equivalent Price: The price of a property with nonmarket financing expressed as the price that would have been paid in an all-cash sale.
Contract Rent: The actual rental income specified in a lease.
Easement: The right to use another’s land for a stated purpose.
Effective Date: The date on which the appraisal or review opinion applies.
Exposure Time: The estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal.
Extraordinary Assumptions: An assumption, directly related to the specific assignment, which if found to be false, could alter the appraisers’ opinions or conclusions.
Fee Simple Interest: Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat.
Floor Area Ratio (FAR): The relationship between the above-ground floor area of a building, as described by the zoning or building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area.
Full-Service Lease: Typically for office buildings, a lease in which the landlord receives stipulated rent and is obligated to pay all of the property’s operating and fixed expenses including utilities, janitorial and all repairs and maintenance.
Going Concern: The market value of an established and operating business including the real property, personal property, financial assets, and the intangible assets of the business.
Gross Lease: A lease in which the landlord receives stipulated rent and is obligated to pay all of the property’s operating and fixed expenses.
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Highest and Best Use: The reasonably probable use of property that results in the highest value.
The four criteria that the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity.
Hypothetical Condition: A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. Comment: Hypothetical conditions are contrary to known facts about physical, legal or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends, or the integrity of data used in the analysis.
Industrial Gross Lease: A type of modified gross lease of an industrial property in which the landlord and tenant share expenses. The landlord receives stipulated rent and is obligated to pay certain operating expenses, often structural maintenance, insurance, and real property taxes, as specified in the lease. There are significant regional and local differences in the use of this term.
Leased Fee Interest: The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.
Leasehold Interest: The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease.
Marketing Time: An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal. Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal.
Market Rent: The most probable rent that a property should bring in a competitive and open market under all conditions requisite to a fair lease transaction, the lessee and lessor each acting prudently and knowledgably, and assuming the rent is not affected by undue stimulus.
Implicit in this definition is the execution of a lease as of a specified date under conditions whereby:
• Lessee and lessor are typically motivated;
• Both parties are well informed or well advised, and acting in what they consider their best interests;
• Payment is made in terms of cash or in terms of financial arrangements comparable thereto; and
• The rent reflects specified terms and conditions, such as permitted uses, use restrictions, expense obligations, duration, concessions, rental adjustments and revaluations, renewal and purchase options, and tenant improvements (TIs).
Modified Gross Lease: A lease in which the landlord receives stipulated rent and is obligated to pay some, but not all, of the property’s operating and fixed expenses. Since assignment of expenses varies among modified gross leases, expense responsibility must always be specified. 309 of 387 Depot Way, Cotati
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In some markets, a modified gross lease may be called a double net lease, net net lease, partial net lease, or semi-gross lease.
Prospective Market Value “As Completed” and “As Stabilized”: A prospective market value may be appropriate for the valuation of a property interest related to a credit decision for a proposed development or renovation project. According to USPAP, an appraisal with a prospective market value reflects an effective date that is subsequent to the date of the appraisal report. Prospective value opinions are intended to reflect the current expectations and perceptions of market participants, based on available data. Two prospective value opinions may be required to reflect the time frame during which development, construction, and occupancy will occur. The prospective market value “As Completed” reflects the property’s market value as of the time that development is expected to be completed. The prospective market value “As Stabilized” reflects the property’s market value as of the time the property is projected to achieve stabilized occupancy. For an income-producing property, stabilized occupancy is the occupancy level that a property is expected to achieve after the property is exposed to the market for lease over a reasonable period of time at comparable terms and conditions to other similar properties.
NNN (Triple Net) Lease: A lease in which the tenant assumes all expenses (fixed and variable) of operating a property except that the landlord is responsible for structural maintenance, building reserves, and management.
Reserves Allowance: An allowance that provides for the periodic replacement of building components that wear out more rapidly than the building itself and must be replaced during the building’s economic life; sometimes referred to as reserves or replacement allowance. 310 of 387
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REGIONAL MAP
Subject
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COUNTY MAP
Subject
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CITY MAP
Subject
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AREA ANALYSIS
Sonoma County
Geography: Sonoma County is the northernmost of
the nine San Francisco Bay Area counties, comprised of
Alameda, Contra Costa, Marin, Napa, San Francisco,
San Mateo, Santa Clara, Solano and Sonoma, all of
which form a physical, social and economic entity and
a geographic area of approximately 4.4 million acres of land with a population of approximately 7.7 million.
Encompassing an area of 1,768 square miles, Sonoma
County ranks twenty-eighth in size out of fifty-eight
counties in the State of California and has the largest land area of any Bay Area county. There are nine
incorporated cities in Sonoma County. Santa Rosa, the
County Seat and located approximately fifty miles
north of the Golden Gate, is the largest Bay Area city north of San Francisco with an estimated 2023 population of 178,026, according to the ESRI.
Economy and Employment: The
technology-based industries were the
most important driving industries in the
county in the 1990's. Employment in
information technology, including
computer programming and data
processing, as well as the manufacture
of electronics, telecom equipment and
optical goods, had soared over the latter
part of the decade, but has since waned
as approximately 5,500 jobs have been
lost in this sector. Equally important,
however, is the balanced nature of the
county’s growth. Wine & food, tourism and other professional services have generated healthy employment gains, and the income growth seen throughout Northern California has in turn boosted retail trade.
Tourism plays an increasingly important role in Sonoma County's economic profile. Long famous for its spectacular Pacific coastline, scenic Russian River area and historic Valley of the Moon, the direct visitor spending was $2.3 billion in 2022 and welcomed 10.3 million visitors, primarily to its wineries which have gained national and international recognition for their premium wine production and bucolic settings, especially given that Sonoma County wines have a competitive advantage over Napa County wines in terms of affordability. Changing consumer preferences has resulted in lower wine consumption in recent years, indicating that there are headwinds in the winery and vineyard markets that will take several years to navigate
EMPLOYER EMPLOYEES
3,827
3,130
1,607
1,528
1,476
1,210
1,247
1,200
1,082
976
Source: County of Sonoma Comprehensive Annual Financial Report Kaiser Permanente
Sonoma State University
TOP EMPLOYERS
Providence (St. Joseph Health)
Sutter Santa Rosa Regional Hospital
Jackson Family Wines
Santa Rosa City Schools
Santa Rosa Junior College
Oliver's Markets
City of Santa Rosa
County of Sonoma
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through. Excluding the wine industry, the four major pull attractions in Sonoma County are scenery, culinary offerings, outdoor recreation and the craft beer, cider and spirits industry, with niche opportunities of cycling, and eco-tourism.
Sonoma County ranks sixth among the nine-county Bay Area in terms of labor force supply, and accounts for 6.1% of the regional force, according to information provided by the California Employment Development Department. Although agriculture remains an important factor in the traditionally agrarian based economy, retail trade, service industries and manufacturing currently represent approximately 89% of the private sector jobs. The greatest growth in employment in 2023 is found in education/health services, leisure and hospitality and construction. It is unclear how there are 6,000 more jobs according to the EDD, but higher unemployment overall.
Industry Employment (Non-Farm)
Sonoma County Dec-24 Dec-23 Difference
Mining and Logging 200 200 0
Construction 16,200 17,200 -1,000
Manufacturing 21,600 24,100 -2,500
Trade, Transportation & Utilities 34,400 35,700 -1,300
Information 2,600 2,600 0
Financial Activities 6,800 8,700 -1,900
Professional & Business Services 23,700 25,200 -1,500
Educational & Health Services 38,300 38,000 300
Leisure & Hospitality 25,400 27,400 -2,000
Other Services 7,800 7,600 200
Government 28,500 26,800 1,700
Totals 205,500 213,500 -8,000
Sources: California EDD and Ward Levy Appraisal Group, Inc.; July 2025 The current unemployment rate for the United States, California and Sonoma County is shown below.
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United States 4.2%
California 4.9%
Sonoma County 3.8%
Source: BLS and CA EDD, May 2025
Monthly Unemployment Data
The following chart shows the comparison of average annual unemployment rates for these areas over the previous 10 years. The current county unemployment rate is 3.8%, which is higher than the 2024 annual rate of 4.1%, the 2023 annual rate of 3.6% and the 2022 annual rate of 2.5%. There is still concern of a recession amid the potential trade wars and economic uncertainty that may arise from the current administration’s tariff threats.
Unemployment Rate – Sonoma County (Trailing 10 Years)
Sources: BLS, California EDD and Ward Levy Appraisal Group, Inc.; July 2025 Residential Market: In 2024, 3,729 homes sold for an overall median of $805,000, which is unchanged from the overall median of $805,000 in 2023. The 2024 figures include 3,404 detached homes which sold for a median of $835,000 compared to 2023’s median of $827,000, and 325 attached homes which sold for a median of $440,000 compared to 2023’s attached median of $445,000. On these metrics, overall prices were relatively stable.
However, the interest rate increases that began in Spring 2022 slowed sales considerably in late 2022 and through all of 2023. In fact, 21.6% fewer homes were sold in 2023 than in 2022, which itself was down by 31.6% compared to 2021. 2024 saw an 11.5% increase in sales volume from the year prior, but overall sales volume is down by approximately 40% from the peak in 2021.
Inventory is expected to remain low as many homeowners have very low interest rates which disincentivizes owners from selling.
The following table provides a comparison of median Sonoma County home prices over the last 20 years.
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2024
Projected
2029
486,997 488,797
478,718 480,518
2.58 2.60
205,702 206,044
185,471 184,536
20,231 21,508
112,849 114,386
72,622 70,150
43.3 44.5
$103,907 $118,506
Median Age
Median Household Income
Persons Per Household
Total Housing Units
Total Households
Vacant Housing Units
Population
Household Population
Owner-Occupied Housing Units
Renter-Occupied Housing Units
Sources: ESRI, U.S. Census
Sonoma County Demographic Data
Sonoma County Median Home Prices
2020 represents a change in methodology.
Sources: Sonoma County Multiple Listing Service and Ward Levy Appraisal Group, Inc.; July 2025 Demography: According to information
from the California Department of
Finance, Sonoma County is the
seventeenth most populous county in
the state with a 2024 population of
486,997. From 1950 to 1980 the
county's population tripled. Almost half
of that growth occurred in the 1970's,
during which time period the county
experienced a 46.3% population
increase as compared with an increase
of only 11.9% for the San Francisco Bay
Area, 18.5% for the State of California
and 11.4% for the nation as a whole. A
slight increase in total population is projected by 2029, which mirrors recent trends in Sonoma County, the Bay Area and California as a whole.
There is an average of 2.58 persons per household with a median income of $109,907 and a median age of 43.3, according to the U.S. Census. Sonoma County has fewer people per household (relative to California’s average of 2.83 persons) with a higher median age (compared to the state average of 38.4 years) and a higher income than the state as a whole ($97,646).
City of Cotati
Incorporated in 1963, the City of Cotati encompasses an area of 1.89 square miles with an estimated 2023 population of 7,593. Physically, Cotati was developed around a hexagonal central plaza known as "The Hub," which is a registered historical landmark and one of only two such hexagonal town layouts in the United States.
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The City of Cotati is heavily influenced by Sonoma State University, located in nearby Rohnert Park. The university, a four-year institution with annual enrollment of about 8,000 students, employs approximately 1,000 persons excluding student employees, and has a significant impact on the Cotati-Rohnert Park area housing stock. College students comprise approximately 10% of the adult population of Cotati.
Entertainment and restaurant businesses located in "The Hub" are currently the largest employers in Cotati. Cotati has two small light industrial areas located west of U.S. Highway 101 and on Industrial Avenue.
Residential Market: Cotati is not separately tracked and is part of the Rohnert Park/Cotati submarket. In the Rohnert Park/Cotati submarket in 2024, 406 homes sold for an overall median of $740,500, which is 2.5% higher than the overall median of $722,500 in 2023. The 2024 figures include 321 detached homes which sold for a median of $775,000 compared to 2023’s median of $759,000, and 85 attached homes which sold for a median of $415,000, which is down slightly from 2023’s median price of $422,000. Sales volume in 2024 has begun to recover from a low period in 2022 and 2023, which is reflected throughout the entire county.
The following table provides a comparison of median Rohnert Park / Cotati home prices over the last 20 years.
Rohnert Park / Cotati Median Home Prices
2020 represents a change in methodology. All years are annual.
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Demography: Cotati experienced the
highest percentage growth rate of any
city within Sonoma County
consecutively during the 1980 - 1994
period, with an average annual growth
rate of 6.4%. Between 2000 and 2010,
growth slowed to 12.3% (1.23% per
year), still one of the highest growth
rates in Sonoma County where overall
growth was only 5.5% during the same
period. However, like much of Sonoma
County, only a slight increase in
population is expected in the next five
years.
There is an average of 2.50 persons per household with a median household income of $92,933 and a median age of 40.2, according to the U.S. Census. Cotati has fewer people per household (relative to Sonoma County's average of 2.58 persons) with a lower median age (compared to the county average of 43.3 years) and a lower household income than the county as a whole ($103,907).
Conclusion
Sonoma County has a well-educated workforce, abundant recreational areas, moderate climate and aesthetic natural setting. It has always been a more affordable option to neighboring Marin County and other Bay Area counties to the south and over the past few years (due to COVID) has seen strong demand from people moving from the central portion of the Bay Area.
This caused dramatic increases in housing prices throughout Sonoma County, though increases in interest rates in 2022 through 2023 have resulted in decreased sales activity with stable prices for the past several years.
However, Sonoma County is projected to continue its growth with the wine industry and tourism as its strongest economic drivers. Manufacturing and construction are experiencing growth. Compared to the Great Recession, households’ finances are in much better condition right now and it is expected that any potential recession will be mild. The recent increases in the unemployment rate are a potential cause for concern, but the current rate is only elevated in comparison to the recent historic lows. The recent implementation of tariffs and the subsequent pause on some of them has injected some uncertainty into the economic outlook with increasing expectations of a recession, though it is still too early to fully understand the full impacts.
2024
Projected
2029
7,562 7,604
7,553 7,595
2.50 2.54
3,186 3,187
3,019 2,995
167 192
1,718 1,770
1,301 1,225
40.2 41.8
Median Household Income $92,933 $105,960
Sources: ESRI, U.S. Census
Total Households
Vacant Housing Units
Owner-Occupied Housing Units
Renter-Occupied Housing Units
Median Age
Demographic Data - City of Cotati
Population
Household Population
Persons Per Household
Total Housing Units
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THE ECONOMY, INFLATION, INTEREST RATES & CAP RATES
Economy Overview
The U.S. economy has shown resilience despite global uncertainties, with steady growth in key areas. The Trump Administration’s recent implementation of tariffs (“Liberation Day”) to its major trading partners as well as reciprocal tariffs for other countries, combined with its noble but somewhat haphazard Department of Government Efficiency (“DOGE”) initiative has led numerous economists to predict that a recession is more likely than when he took office. In the first quarter of 2025 Real Gross Domestic Product (GDP) decreased at an annual rate of -0.3%, after increasing 2.3% in the fourth quarter of 2024. While the negative GDP certainly grabs headlines and was met with concern that a recession could be imminent, it is important to remember that the negative GDP was largely driven by a surge in imports in advance of the announced tariffs. GDP is calculated at Consumption (C) + Investment (I) + Exports (X) – Imports (M). Since the Imports (M) were artificially high in order to beat the impact of tariffs, this lead to a negative GDP. The labor market remains strong, with the unemployment rate hovering around 4.2% and so far inflation measures have largely been improving, with the April inflation reading of 2.3% according to the Bureau of Labor Statistics. However, the impact of the tariffs is still unfolding and there on-again, off-again implementation has market observers concerned about the prospect of a recession.
Inflation and the Fed
Continued concerns about inflation means the Fed will only cut rates when it feels inflation is under control and the potentially inflationary conditions that the tariffs would likely cause have resulted in the Fed recently announcing it may not cut rates any more in 2025 and will wait until June 2025 to decide. However, counteracting this is that if economic growth slows or the economy slips into a recession, the Fed will likely need to cut rates. This can lead to “stagflation”, where economic growth is stagnant, inflation is rising, and unemployment increases. In this scenario, the government’s hands are tied because attempts to spur economic growth through rate cuts potentially leads to more inflation and if they raise interest rates to reduce demand and curtail inflation, economic growth will remain low and unemployment will rise. So far, inflation figures have been lower than expected and unemployment has remained low. The Fed will continue its wait and see approach.
10 Year Treasury Yield
As it relates to commercial real estate (CRE), the reality is that the increasing interest rates lead to reduced demand for real estate. The graph below shows the yield on the 10-year treasury note for the past year. The 10-year treasury is the most common index for commercial loans.
The blue line represents the weekly average while the black line represents the 25-day moving average. In reality, the market began to decline in advance of the Fed’s rate cut announcement in September. First, forward guidance from the Fed in late 2023 foretold that rate cuts would be likely in 2024, and a decline occurred in late 2023 as a result. However, inflation figures in early 2024 were still above the Fed’s target numbers and they signaled a delay in rate cuts and the treasury yield increased from early 2024, peaking in May. At this time the Fed began 320 of 387 Depot Way, Cotati
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signaling that inflation figures were getting under control and its guidance again suggested that rate cuts were likely at the September meeting. The irony is that since the first rate cut in September the 10-year treasury yield went from 3.66% to 4.77% in January 2025. This is the opposite of what market observers expected. Some observers say that the U.S. Government’s use of deficit spending requires sustained borrowing, and the rates reflect that the federal fiscal policy is out of whack and that investors’ faith in the nation’s ability to honor its debts erodes, leading to higher rates. The Fed had previously indicated that further rate cuts would occur in 2025, but the likely inflationary conditions brought upon by the tariffs has resulted in the Fed issuing a statement casting doubt on additional rate cuts. Since so called “Liberation Day,” when President Trump announced tariffs to most trading partners, the daily rate has been quite erratic, reaching a low of 4.00% just days after the announcement to as high as 4.60%. The 25- day moving average has increased slightly over this time period as well. 10 Year Treasury Yield
Investor Demand & Cap Rates
Interest rates have begun to stabilize (though continue to fluctuate widely) after increasing substantially from 2022 through 2023. Cap rates and interest rates do not always move at the same pace, there is certainly a relationship between the two since borrowing costs increase with higher interest rates. The Price Waterhouse Cooper Investor Survey shows that over the past year, rates have remained much more stable. The average cap rate is the average of multiple indicators for each property type. For example, the average cap rate for the apartment market is the average of the Pacific Region cap rate and the National Market cap rate. The average cap rate decreased for the retail sector, were slightly higher for the office and warehouse sectors and increased somewhat more for the apartment sector. These changes come on the heels of substantial increases from 2023 to 2024 and so it appears that the market has stabilized somewhat, at least in regard to capitalization rates. 321 of 387
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Office Retail Warehouse Apartment
Average Cap Rate 8.26% 7.19% 5.33% 5.28%
Cap Rate Change (bp) +1 -2 +4 +26
Value Change w/ Level Income -5.3% 8.8% 0.3% -0.9%
Value Change w/ 3% NOI Increase -2.5% 12.1% 3.3% 2.1%
Change from1Q24 to 1Q25
Property Type
The value change is then calculated assuming the average cap rate as of the first quarter 2025 and compared to the average cap rate one year ago. The value change is calculated using two scenarios, a flat NOI and NOI increasing by 3%. For the level income scenario, the value declined in two of the four property type categories (office and apartment), downward by 0.9% to 5.3%. For the retail and warehouse markets, values would be 0.3% to 8.4% higher. In the second scenario, values declined in only the office category, by 2.5%. The other three categories showed increases of 2.1% to 12.1%. These are illustrations only based on the survey data for national markets but do show the potential value changes in commercial real estate over the past year. Increasing operating expenses for insurance and utilities can eat away at any NOI growth and actually push NOI downward, particularly for the office and apartment sectors where the landlord is typically responsible for those expenses.
Conclusion
There are some concerns about overall economic conditions and a possible recession given global unrest, a trade war brought about by recent tariffs, weakening consumer spending and burgeoning consumer debt. Whether the recent decline in GDP was a one-time aberration or a sign of an impending recession is unclear but so far the unemployment market has remained strong. The Fed appears to be getting inflation under control, but the number of cuts and the amount of these future rate cuts is uncertain. If the Fed continues to cut rates and the 10-year treasury yield declines, there should be lower interest rates going forward. Whether these cuts spur the commercial real estate market is yet unknown and is dependent on each property’s specific attributes and leased status. There is some optimism for the first time in a few years that rates will become more affordable, but it may take a few years for rates to settle into a stable range.
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NEIGHBORHOOD MAP
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NEIGHBORHOOD ANALYSIS
The subject is located in the eastern area of the City of Cotati. The approximate neighborhood boundaries are:
• North: East Cotati Avenue
• East: Camino Colegio
• South: Myrtle Avenue
• West: Old Redwood Highway
The subject neighborhood comprises mostly single- and multi-family residential developments with some smaller neighborhood commercial properties located to the north and northwest.
Commercial uses are also found at the southern end of Santero Way, consisting of mainly smaller warehouses and a mini-storage development, although these are being considered for acquisition and development with multi-family residences as part of a larger project discussed in more detail later in the Sales Comparison Approach section of this report as Comparable 1. A SMART (Sonoma Marin Area Rail Transit) train depot is located in the northern part of the neighborhood, immediately north of the subject property. SMART is a commuter line designed to run from Cloverdale in north Sonoma County to Larkspur in southern Marin County, a total of 70 miles. Currently the line’s northernmost station is at downtown Windsor, a station which finally opened for service in 2025 after having been initially projected to be open in 2021.
Future extensions to Healdsburg and Cloverdale are planned and in June 2025 SMART announced an $81 million award recommended from the State of California to extend passenger rail service from Windsor Station north through Healdsburg to the northern Healdsburg city limits.
Sonoma State University is located within one mile northeast of the subject and is a primary influence on the subject property. Located on approximately 269 acres, it is one of the smallest of the 23 California State University (CSU) campuses. The university has suffered from a mounting financial crisis over the last several years which came to a head in January 2025 when the university announced the elimination of over a dozen majors, the layoffs of 46 faculty members, and the shuttering of its Division II athletics program to attempt to close a $24 million deficit. Predictably, all of this has led to a drastic collapse in enrollment; whereas in 2018 there were around 9,200 students, the university’s website now lists enrollment of 6,400 students. The declines in the student body contributed to a self-perpetuating downward spiral wherein fewer students meant fewer dollars, which forced further cuts, which reduced the number and scope of class offerings, which further dissuaded potential future students. And while previously the university employed approximately 1,500 persons, it now lists just 500 faculty along with 700 staff and administrators.
Neighboring Properties
• North: SMART Train Depot
• East: SMART Rail Tracks
• South: Vacant Land
• West: Vacant Land 324 of 387
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Public Utilities
All municipal services are available throughout most of the neighborhood, including water, sewer, natural gas, electricity, cable television and telephone. Pacific Gas and Electric supplies natural gas and electricity to the neighborhood, AT&T provides telephone service and Recology provides trash removal. The City of Cotati provides water, sewer, police and fire services.
Support Services
The subject neighborhood is convenient to shopping, employment centers, schools, etc. The nearest shopping center for neighborhood residents is the Rancho Cotati Shopping Center located on East Cotati Avenue, less than one half mile east of the subject, which contains an Oliver’s Grocery, several restaurants, a post office and banking. Schools are considered of average quality by area residents. Students attend Thomas Page Academy located at 1075 Madrone Avenue, Technology Middle School located at 7165 Burton Avenue in Rohnert Park, and Rancho Cotate High School located at 5450 Snyder Lane, Rohnert Park.
Access
The major roads serving the subject neighborhood are East Cotati Avenue and Old Redwood Highway. Access to U.S. Highway 101 is available via the Gravenstein Highway interchange approximately 1.25 miles west of the subject. Access to State Highway 116 (Gravenstein Highway) is found just east of the Highway 101 interchange at Old Redwood Highway, approximately 1.25 miles west of the subject.
Demographics
The following are the demographics for the subject’s area. 325 of 387
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DESCRIPTION 1 MILE 3 MILE 5 MILE DESCRIPTION 1 MILE 3 MILE 5 MILE
POPULATION HOUSEHOLDS
2010 Total Population 21,849 55,495 72,683 2010 Households 7,717 20,832 26,944 2020 Total Population 22,448 59,975 78,176 2020 Households 7,900 21,956 28,383 2024 Total Population 21,887 61,148 79,240 2024 Households 7,707 22,286 28,616 2029 Total Population 21,876 62,065 80,186 2029 Households 7,638 22,422 28,718 Δ 2010-2020 2.7% 8.1% 7.6% Δ 2010-2020 2.4% 5.4% 5.3%
Δ 2020-2024 (2.5%) 2.0% 1.4% Δ 2020-2024 (2.4%) 1.5% 0.8% Δ 2024-2029 (0.1%) 1.5% 1.2% Δ 2024-2029 (0.9%) 0.6% 0.4% Total Daytime Population 13,054 50,009 73,233 2024 Households by Income HOUSING UNITS <$15,000 6.4% 6.5% 6.5%
Total (2024) 8,168 23,933 30,675 $15,000 - $24,999 3.2% 4.0% 4.0% Owner Occupied 52.3% 52.8% 53.6% $25,000 - $34,999 3.9% 4.7% 4.6% Renter Occupied 42.0% 40.3% 39.7% $35,000 - $49,999 10.3% 8.9% 8.4% Vacant Housing Units 5.6% 6.9% 6.7% $50,000 - $74,999 14.0% 14.5% 14.7% Total (2029) 8,183 23,952 30,717 $75,000 - $99,999 14.2% 13.6% 13.6% Owner Occupied 52.6% 54.1% 54.8% $100,000 - $149,999 20.5% 19.3% 18.7% Renter Occupied 40.7% 39.5% 38.7% $150,000 - $199,999 13.1% 12.2% 12.6% Vacant Housing Units 6.7% 6.4% 6.5% $200,000+ 14.3% 16.3% 16.9%
AVERAGE HOUSEHOLD INCOME AVERAGE HOUSEHOLD SIZE
2024 $123,668 $129,568 $131,710 2024 2.74 2.62 2.66
2029 $144,358 $150,671 $152,762 2029 2.76 2.64 2.69
Δ 2024-2029 16.7% 16.3% 16.0% Δ 2024-2029 0.7% 0.8% 1.1%
MEDIAN HOUSEHOLD INCOME MEDIAN HOME VALUE
2024 $95,462 $94,877 $95,813 2024 $667,384 $705,825 $745,607 2029 $108,530 $108,190 $109,400 2029 $748,406 $849,492 $888,844 Δ 2024-2029 13.7% 14.0% 14.2% Δ 2024-2029 12.1% 20.4% 19.2%
PER CAPITA INCOME AVERAGE HOME VALUE
2024 $44,226 $47,534 $47,748 2024 $741,587 $789,280 $834,709 2029 $51,159 $54,755 $54,895 2029 $876,672 $975,336 $1,017,505 Δ 2024-2029 15.7% 15.2% 15.0% Δ 2024-2029 18.2% 23.6% 21.9% Source: ESRI
Population growth is anticipated within the subject’s neighborhood over the next five years.
The median income in the subject’s one-mile radius is similar to three- and five-mile radius.
Conclusion
The subject neighborhood is convenient to shopping, employment centers and schools. A SMART train depot is located at the northern end of the neighborhood, immediately north of the subject. The overall outlook for the subject is positive. 326 of 387
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SITE ANALYSIS
The subject consists of one Assessor’s Parcel. The table below presents a summary of the parcel’s attributes. It should be noted that in accordance with the Santero Way Station Area Specific Plan, a future extension of Depot Way will be extended across a small portion of the subject at its eastern boundary. Technically, this represents a nominal loss of developable site area as this area would need to be dedicated for access right-of-way and could not be developed with buildings, but in the City of Cotati, permissible density calculations are based on gross site area, and so this nominal exclusion does not reduce the number of potential units a developer could seek to build. Since we were not provided with any figure regarding the acreage which will need to be dedicated, we have not reduced the usable site area here, but rather have simply incorporated the need to cluster units on the developable portion into our reconciliation of value.
Parcel Summary
APN Gross Acres Gross Land SF Usable Acres Usable Land SF Topography Shape 144-320-033 0.56 24,394 0.56 24,394 Level Irregular
The description that follows is a summary of the subject site’s attributes.
Site Summary
Address Depot Way
Cotati, CA 94931
Assessor’s Parcel Number 144-320-033
Primary Frontage Street Depot Way: Approximately 240 feet Access Average
Topography Basically level, but with some modest soil mounding that would need to be graded to allow for development
Shape Irregular
Corner Lot No
Site Status The lot has curbs and gutters along a portion of the Depot Way frontage, but based on the projected frontage improvements and infrastructure that would still need to be constructed as a condition of development, the subject is effectively considered most similar to raw land.
Curbs/Gutters On Santero & Depot Way
Sidewalks No
Streetlights On Santero & Depot Way
Site Hazards
FEMA Flood Panel / Date 06097C0879E / December 2, 2008
Flood Zone X - The subject is not in a special flood hazard area. A copy of the FEMA Flood Map is contained in the Addenda.
Alquist Priolo No
Wetlands/Biotics None noted
Riparian Corridors None
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Environmental Issues None reported or observed
Easements/Encumbrances No Preliminary Title Report was provided - See Extraordinary Assumption
Encroachments None observed
Utilities Summary
Electricity PG&E
Natural Gas PG&E
Water Public water
Wastewater Public sewer
Conclusion
The subject is a functional site that is served by all public utilities. It features an irregular shape, but the utility of this is likely to be addressed by the future required dedication of an access right-of-way for an extension of Depot Way as indicated in the Santero Way Station Area Specific Plan. The subject is generally level and at street grade but features a couple of areas of gently mounded soils, and some modest grading will most likely be needed.
Otherwise, there are no known adverse conditions likely to negatively impact value and prevent the subject from being developed to its highest and best use. 328 of 387
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Assessor’s Parcel Map
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ZONING ANALYSIS
The subject’s zoning is summarized below. Note that the subject is currently zoned SW (Santero Way) but is reportedly in the process of being re-zoned to TOC (Transit-Oriented Communities, a change that is expected to be finalized by late Summer 2025. These are the two zoning districts which make up the Santero Way Specific Plan area. According to city officials, a developer formally proposing a project could still do so in accordance with the SW zoning, and so we have included a description of both zonings below. The two are extremely similar, with the main difference being that 100% commercial development is not allowed in the SW District, whereas it is in the TOC district. Based on the location, our own experience and discussions with market participants, a 100% commercial development would not appear to be the highest and best use for the site, and so this distinction is considered effectively immaterial in the analyses to follow.
Zoning Summary
Zoning Authority City of Cotati
General Plan Designation Santero Way Station Area Specific Plan Zoning SW (Santero Way)
Zoning Description The SW District is applied to all areas appropriate for a variety of higher-density residential and mixed-use development types, including multi-family housing, condominiums, and townhomes.
The allowable residential density range is 25-35 units per acre (25 u/a minimum, 35 u/a maximum) and the allowable Floor Area Ratio (F.A.R.) for commercial development is a minimum of 1.0 and maximum of 3.0. Commercial uses are limited to
neighborhood serving retail and live-work applications associated with a residential development project. Additionally select allowances for low-intensity industrial land uses are applied to parcels with existing buildings to facilitate maximum functionality prior to anticipated redevelopment. The development standards are shown below:
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Transit-Oriented Communities (TOC): The TOC District is applied to all areas appropriate for a variety of higher-density mixed use development types, neighborhood-serving commercial, and lightmanufacturing/maker type uses on parcels with frontage on East Cotati Avenue and the northern portion of Santero Way, closest to the train station. The allowable base density range is 25-35 units per acre (25 u/a minimum, 35 u/a maximum) and the allowable Floor Area Ratio (F.A.R.) for commercial development is a minimum of 1.0 and maximum of 3.0. The development
standards are shown below:
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GP & Zoning Conform Yes
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Zoning Map (reflects pending re-zone from SW to TOC)
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HIGHEST AND BEST USE
Highest and best use of a property as improved pertains to the use that should be made of an improved property in light of its improvements. The existing improvement is compared with the ideal improvement. The use that maximizes an investment property’s value, consistent with the rate of return and associated risk, is its highest and best use as improved. It is to be recognized that in cases where a site has an existing improvement, the highest and best use may very well be determined to be different from the existing use. The existing use will continue, however, unless and until land value in its highest and best use exceeds the total value of the property in its existing use. Thus, the highest and best use requires the estimate of the highest and best use of the land as if vacant.
Analysis of the highest and best use of land or a site as though vacant assumes that a parcel of land is vacant or can be made vacant by demolishing any improvements. The questions to be answered during the analysis of the highest and best use of the land as if vacant are 1) if the land is, or were, vacant, what use should be made of it, and 2) what type of building or other improvement, if any, should be constructed on the land and when? Highest and best use is an analysis of those uses which are legally, physically and financially feasible. Once the potential uses are identified within these parameters, the most probable highest and best use can be identified.
Highest and Best Use As Vacant
Legally Permissible: Legal uses of a site are governed by land use policies and regulations of local governmental entities. The subject site is zoned SW; Santero Way by the City of Cotati and has a General Plan land use designation of Santero Way Station Area Specific Plan. The zoning does conform to the General Plan land use designation. The General Plan and zoning descriptions in the Site Analysis discussion detailed the types of uses that would generally be permitted on the subject site. As noted previously, the subject is in the process of being rezoned to TOC, Transit-Oriented Communities, a process which should be finalized by late summer. The two districts are quite similar and feature identical residential density ranges of
25.0 to 35.0 units per acre, but development with 100% commercial uses is permitted in a TOC zone, while it is not in an SW zone. According to city officials, a project submitted presently which was in compliance with either zoning would be able to obtain approvals.
Physically Possible: There are no physical features that would preclude any of the legally permissible uses. The subject site is basically level and at street grade, although it features some minor soils mounding in a couple of places which would need grading. The site is not located within a special flood zone or an earthquake zone.
Financially Feasible: Multi-family development is currently feasible in Sonoma County and there are a number of projects which either were recently completed or are currently under construction. From our analysis of recent projects, including analyzing developers’ actual pro forma spreadsheets, it appears that development is feasible, or near feasible. According to CoStar, the country’s largest real estate analytics company, CoStar shows a current vacancy rate 334 of 387
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for Sonoma County of 5.1% which is an increase since mid-2022 when the vacancy rate was
2.4%, but which actually reflects a dip from the recent peak. The increase in vacancy rates is largely due to increased supply coupled with slightly reduced demand. Year-over-year asking rents grew by 2.8%, and this growth had been as high as 8.1% back in the first quarter of 2022, but significant new construction coming online will create a price ceiling upon delivery.
Currently the market features a slight oversupply as new units are slightly late to capture previous momentum and rent growth stagnates, following the wave of demand which had led to record supply. Demand in the subject location would be expected to be average given the need for units and the proximity to services and transportation, offset by the fact the fact that a number of prospective tenants would not want to live literally next to a train station.
The market for retail properties is reasonably strong and, in fact, new retail buildings are being constructed in the county. However, without a substantial pre-lease commitment, such development is not considered financially feasible. Typically, lenders require such pre-lease commitments before approving construction loans. As such, a pre-lease or build-to-suit development is considered feasible. The subject would not feature very good commercial visibility from either Santero Way or East Cotati Avenue, but would benefit from traffic to the SMART station. Market participants felt it was possible although not necessarily likely that a commercial use could be included as part of a larger mixed-use project, but did not feel that the site was a good one for development with 100% commercial uses.
The office market has been hit harder by COVID, and the office market features higher vacancy and lower demand than the retail sector. Given the available space already on the market, demand for professional office space would not appear to support new construction.
Maximally Productive: The test of maximum productivity is applied to the uses that have passed the first three tests. Of the financially feasible uses, the highest and best use is the use that produces the highest residual land value consistent with the market’s acceptance of risk and reward. At the present time, the maximally productive use is considered to be for either 100% multi-family residential uses or a mixed-use multi-family/commercial development.
As Vacant - Conclusion: The highest and best use of the subject site as if vacant is considered to be the development of 100% multi-family residential uses or mixed commercial and multifamily residential uses in conjunction with a build-to-suit or pre-lease commitment for the commercial component.
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APPRAISAL PROCESS
There are three basic approaches that may be utilized by appraisers in the estimating of market value for the subject improvements. These three approaches provide data from the market from three different sources when all are available. These three approaches include the Cost Approach, the Sales Comparison Approach and the Income Approach.
The Cost Approach is based upon an assumption that an informed purchaser would pay no more for a property than the cost of producing a substitute property with the same utility as the subject. In the Cost Approach, value is estimated by comparing the current cost of replacing the subject improvements, and then subtracting depreciation for physical deterioration and functional or economic obsolescence. The cost of replacing a property is generally estimated on a per square foot basis using a construction cost manual published by a recognized cost reporting service, and through continued cost updating by the appraiser to account for local conditions. The value of land is added to the depreciated cost of the improvements for the final value indication by this approach.
The Sales Comparison Approach is based upon the assumption that an informed purchaser will pay no more for a property than the cost of acquiring an existing property of the same utility.
This approach estimates market value by comparing the sales prices of recent similar transactions with the various attributes of the property under appraisement. Any dissimilarities are resolved by making appropriate adjustments. These differences may pertain to time, age, location, construction, condition, size or external economic factors.
Also analyzed within the Sales Comparison Approach is the relationship between the gross income and sales price. This ratio, called the Gross Income Multiplier (G.I.M.), when properly extracted from the market, may be used to indicate the value of the subject property. The Sales Comparison Approach often provides a highly supportable estimate of value for homogeneous properties. For larger and more complex properties, the required adjustments often become numerous and more difficult to estimate.
The Income Approach converts the anticipated future benefits of property ownership (dollar income) into an estimate of present value. The Income Approach is generally selected as the preferred technique for income-producing properties because it most closely reflects the investment rationale and strategies of typical buyers. To utilize the Income Approach, the appraiser must project net income, select an appropriate capitalization rate and then capitalize the net income into value, applying the proper discounting procedure.
Normally, these three approaches will each indicate a different value. After all of the factors in each of the approaches have been carefully weighed, the indications of value derived from each of the approaches are correlated to arrive at a final opinion of value.
Analyses Applied
A Cost Approach was considered and was not developed because there are no improvements to analyze.
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A Sales Comparison Approach was considered and was developed because market participants consider similar type properties when determining the subject's market value and thus the Sales Comparison Approach is utilized in the analysis.
An Income Approach was considered and was not developed because the subject is not a typical income producing property.
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LAND VALUATION
When appraising property, it is customary to value the land as though vacant and able to be developed to its highest and best use. The preferable method of determining the market value of the fee simple interest of the subject site is by comparison to properties that have recently sold, are listed for sale or are under contract. Comparable properties are analyzed and compared with the subject property.
The comparative analysis performed in this approach focuses on similarities and differences among properties, and transactions that impact market value. These may include differences in the property rights appraised, the motivation of buyers and sellers, financing terms, market conditions at the time of sale, size, location, utility of the site, zoning and site conditions. The various attributes of comparison are tested against market evidence to determine their relative importance, if any.
The subject features a zoning allowing for mixed-use commercial/residential and/or 100% multi-family residential development. It is about to be re-zoned to a very similar district which would also allow for 100% commercial development. Based on the highest and best use conclusion, we have analyzed the subject in conjunction with sales of other properties with similar mixed-use or multi-family residential development potential.
A critical factor affecting this analysis is the difference between the business models for market rate and affordable apartment developers. Market rate developers typically do not assign any residual land value to units to be designated as affordable to low or very low income households; this is because given the applicable rent restrictions at these levels of affordability, the returns generated by these units generally cover direct and indirect construction costs as well as developer’s profit, but not land. In contrast, affordable developers have a different business model which does not rely on maximizing potential rents; they also have access to outside funding sources and are effectively using other organizations’ money to pay for land acquisitions. In our experience, and based both on sales in the subject’s local market area and discussions with market participants, affordable developers will pay as much for 100% affordable development sites as market rate developers will for sites that can be developed with 100% market rate units. However, further analysis is indicated when market rate developers acquire sites to be developed with a mix of market rate and affordable units, as they would not be expected to pay commensurately for those units which will be required to be designated as affordables.
In accordance with the preceding, for Comparables 2 and 7, which were both proposed for development with 100% affordable units, the sale transactions have been analyzed on the basis of the total number of units which the respective buyers projected they would be able to develop. Comparables 3, 4 and 6 were purchased for 100% market rate development and have also been analyzed on the basis of the total number of projected units. However, Comparables 1 and 5 each feature a proposed mix of market rate and affordable units and warrant further discussion.
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Comparable 1 was placed in contract by a market rate developer; it had entitlements for 98 units, of which 15% would need to be dedicated for affordable housing. This equates to 15 affordables and 83 market rate units. Given the most likely buyer’s motivation, and how the affordables would not have any residual value to this buyer, value has been assigned solely to the proposed 83 market rate units. Similarly, Comparable 5 sold with entitlements nearly in place for 32 market rate units along with 8 affordables. Four of the below market rate units will be categorized as needing to be affordable to extremely low income households, or those making between 15 and 30% of average median household income (or AMI), while the other four will need to be affordable to very low income households, or those making between 30% and 50% of AMI. Again, given how the affordables would not have any residual value to the most likely buyer, particularly given the extremely and very low income categories, value has been assigned solely to the proposed 32 market rate units.
In the initial per square foot analysis we considered making an upward adjustment based on the pro rata acreage needing to be dedicated for affordable units, but ultimately have chosen to simply discuss this issue for these two comparables in the reconciliation. In the per unit analysis utilized as a check, though, we have analyzed these sales based solely on the respective number of market rate units, while still incorporating the total overall density (and not simply that reflecting solely the market rate units) for each project as a measure of comparison. This is because the relative density characteristics of a project and how density affects such issues as relative lot sizes, unit size restrictions and multi-story construction cost sensitivities would be impacted by the affordable units as much as market rate ones.
There are a couple of additional critical factors to recognize.
The first is that affordable developers expect to pay market value for land, regardless of the affordability level of a proposed project. Often, an affordable developer does not have a specific affordability scheme in mind when acquiring property. The ultimate mix of extremely low, very low, and low income units is largely driven by funding sources. To be competitive for a specific funder’s contribution, points are typically awarded for meeting that funder’s preferred affordability scheme. Different funders incentivize different schemes and individual funding programs change frequently, so the affordability mix is very fluid and dynamic. In the end, typically a developer has several funding sources for a single project, and each one likely has different affordability requirements, so a developer must meet the most stringent requirements to satisfy all funders. These funders can include both “soft” loans from government agencies and equity from tax credit investors. So ultimately, affordable developers are not inclined to offer different amounts for land simply based on the affordability scheme.
The second is that affordable developers’ expectation to pay market value for land also extends to different locales within the same county, including those with divergent property values. All affordable rents are formula-based on median incomes, and almost always by county. At first, this seems counterintuitive, as developers’ and investors’ economics would not change commensurately from a market with lower values to a neighboring one with higher values; funding mechanisms, affordable rent limits, operating expenses and construction costs would all remain roughly the same. But while affordable developers frequently pursue favorable terms such as longer escrow periods or lower hard money deposits, they do not expect to pay 339 of 387 Depot Way, Cotati
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below market prices. If land costs more in one area of the county versus another, then they simply need to raise a bit more funding for that project. The tax credit program in recent years has provided for more scoring points to projects located in “high resource” areas, which simply means higher land cost areas; this is to incentivize affordable housing developments in locations where schools are better, employment opportunities are more plentiful, etc. Thus, while land costs in an area with comparatively high property values will be high, affordable developers may pursue a project there if they believe the “high resource” status makes the project more competitive for tax credits. Such a project would cost more and require greater levels of soft loans, but this is still a viable strategy given that tax credit applications need to be nearly perfect due to the extremely competitive market for credits.
In addition, and somewhat more generally, affordable housing project decisions are almost completely funding-driven. Developers will consider local politics, vulnerability to litigation, whether a neighborhood already has more than its fair share of affordable projects, and other factors, but overwhelmingly funding viability is what drives a project. For example, many funding programs currently require that locations be near public transportation, pedestrianfriendly, and so forth, and so some developers have shifted from suburban to urban developments in recent years. Similarly, sub-populations are often targeted by funders; as one example, California currently has significant funding for housing homeless persons, so there are a number of such projects in developers’ current pipelines. Ultimately, affordable developers go where the money directs them, and if land costs are higher, that is reportedly a negligible impediment if that location scores high for extremely competitive funding sources.
Included on the following pages are the comparable land sales followed by a locational map, summary table and analysis and conclusion of land value. The appraisers confirmed the sales with at least one party to the transaction and verified all characteristics discussed in the analysis with either public sources, such as site size from County Assessor’s records, or from parties to the transaction, including buyers, sellers or agents.
In addition to the following comparables, the appraisers are also aware of a listing of another small mixed-use site in Cotati. This is a 40,075 square foot site at 11 Wilford Lane (which includes a second parcel developed as a car wash, although the listing states that the car wash itself is not included in the listing). It is located in the “Commerce Avenue” section of the Downtown Specific Plan area and would allow for mixed-use development. It was placed on the market in July 2024 for $1.6 million, or $39.93 per square foot, and has not sold after roughly a year on the market at the same price. The listing agent did not respond to messages but given the length of time on the market without the price having been reduced at all, this site simply appears to be overpriced.
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ID 12441
Address Santero Way
City Cotati
State CA
Zip 94931
County Sonoma
Latitude 38.32958844
Longitude -122.6908467
Tax ID 144-320-034 through -036
Property Major Type Land
Property Type Multi-Family
Property Type Multi-Family Date 4/23/2023
Address Santero Way Transaction Type Pending Contract
City Cotati Days on Market 365
County Sonoma Actual Price $4,750,000
State CA Price Adjustment $0
Tax ID 144-320-034 through -036 Price $4,750,000
Grantor Colvin Group Fund I Price per Usable Land SF $45.26 Grantee Southrock Ventures Sale Verification Source Erich Reichenbach Document# N/A Sale Data Source Listing Agent
Acres 2.41 Site Status Raw
Land SF 104,951 Entitlements Entitled
Usable Acres 2.41 Topography Level
Usable Land SF 104,951 Utilities All Public Utilities
Zoning SPSW Shape Irregular
GP Designation Specific Plan Improvements of Value None Comparable 1
Transaction
Site
Sale Comments
Site was placed in contract in April 2023 with approvals for 98 apartments averaging 765 sf and 5,587 sf of commercial space. Cotati requires 15% affordables, so there would be 15 affordables and 83 market rate units. Property had fallen out of escrow multiple times previously as buyers were not able to make proposed projects pencil. In late 2023, despite the fact that these buyers have access to economies of scale and can build less expensively than most, they said that the project did not pencil at the contract price. They subsequently negotiated in 2024 to acquire adjacent parcels to develop additional units and a community center and aquatic center, but by 2025 had scrapped plans for all construction except additional units. They want to develop ~173 units on this site and two adjacent parcels for a combined site of 3.37 acres, with a 50% density bonus for providing 15% very low income units. Pricing for the expansion parcels and the actual project scope are still being determined as of July 2025 and no other agreements have been reached, so this sale is analyzed just on the original Phase 1 contract portion for these three parcels, with the caveat that even experienced developers felt the price was too high to support construction at that density. Density shown is based on all 98 units but price per unit should be based only on 83 units as the affordables would have no residual land value to these buyers. Expected to close sometime in late 2025. Site features older curbs and gutters but given projected infrastructure improvements, site status is considered most similar to raw land.
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ID 14070
Address 210 Shiloh Road
City Windsor
State CA
Zip 95492
County Sonoma
Latitude 38.5247958
Longitude -122.7831292
Tax ID 059-310-051, 050-310-052
Property Major Type Land
Property Type Mixed Use
Property Type Mixed Use Date 6/11/2025
Address 210 Shiloh Road Transaction Type Pending Contract City Windsor Days on Market 1619
County Sonoma Actual Price $3,250,000
State CA Price Adjustment $262,500
Tax ID 059-310-051, 050-310-052 Price $3,512,500
Grantor Amador Price per Usable Land SF $16.35
Grantee N/A Sale Verification Source Rene Brochier
Document# N/A Sale Data Source Listing Agent
Acres 5.23 Site Status Raw
Land SF 227,818 Entitlements Contingent Upon Entitlements Usable Acres 4.93 Topography Level
Usable Land SF 214,818 Utilities All Utilities Available Zoning BC Shape Rectangular
GP Designation Boulevard Mixed Use Improvements of Value None of value Comparable 2
Transaction
Site
Sale Comments
This site is located in the potential California Tiger Salamander habitat range where mitigation would be required at a ratio of 0.2:1. Based on an estimated mitigation cost of $250,000 per acre, mitigation costs are estimated as shown above and added to the price. The southern half of the site is located in a special flood hazard area and may need to be built up. The listing agent indicated there was a setback requirement from Pruitt Creek along the south boundary which likely reduced the developable site area as estimated above. The site was improved with a barn but this was a tear-down. Zoning would allow for mixed-use development with a residential density from 16 to 32 units per acre. Site has been marketed for years but the listing agent stated that this was due to its having been placed in escrow several times. Site was listed for $4.2 million and the listing agent would not confirm the precise contract price but stated that it was in between $3 million and $3.5 million, and a midpoint estimate has been utilized. Buyers are affordable housing developers who placed site into contract in April 2025 contingent upon entitlements for a mixed-use project to include primarily apartments with most likely the minimum required commercial square footage. They will presumably get a density bonus for building affordables, but no specific density information was available when this sale was confirmed in June 2025, so sale is analyzed based on zoned density which will in all likelihood be increased upon approvals. Anticipated to close in early 2026.
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ID 14007
Address 710 Kawana Springs Road
City Santa Rosa
State CA
Zip 95404
County Sonoma
Latitude 38.416126
Longitude -122.707409
Tax ID 044-041-082
Property Major Type Land
Property Type Multi-Family
Property Type Multi-Family Date 4/1/2025
Address 710 Kawana Springs Road Transaction Type Closed Sale City Santa Rosa Days on Market 77
County Sonoma Actual Price $1,300,000
State CA Price Adjustment $0
Tax ID 044-041-082 Price $1,300,000
Grantor Kawana Springs Road LLC Price per Usable Land SF $19.90 Grantee 710 Kawana Springs Realty LLC Sale Verification Source Jennifer Jacobs Document# 13868 Sale Data Source Selling Agent
Acres 1.50 Site Status Raw
Land SF 65,340 Entitlements Unentitled
Usable Acres 1.50 Topography Level
Usable Land SF 65,340 Utilities All Utilities Available Zoning RR-20 Shape Rectangular
GP Designation Medium Density Residential Improvements of Value None Comparable 3
Transaction
Site
Sale Comments
This site is located immediately southeast of Santa Rosa Marketplace, a regional power center anchored by Costco, Target and Best Buy. The site was placed on the market in January 2025 for $1,395,000 and was placed in contract in February for $1,300,000. The zoning allows for up to 18.0 units per acre, or as many as 27 units. The site also has frontage along Meadow Way. Selling agent indicated the buyer was planning a 27 to 32 unit apartment project. There were no contingencies, other than the initial inspection period. The buyer did consult the planning department and was comfortable that a project at the maximum density would be feasible. There were no improvements and the property will need curbs, gutters and sidewalks along both street frontages. 343 of 387
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ID 12543
Address 561 Renaissance Way
City Santa Rosa
State CA
Zip 95403
County Sonoma
Latitude 38.47355066
Longitude -122.7293078
Tax ID 173-030-033
Property Major Type Land
Property Type Multi-Family
Property Type Multi-Family Date 7/13/2023
Address 561 Renaissance Way Transaction Type Closed Sale City Santa Rosa Days on Market 730
County Sonoma Actual Price $12,325,000
State CA Price Adjustment -$1,620,000
Tax ID 173-030-033 Price $10,705,000
Grantor 3575 Mendocino Ave. Associates Price per Usable Land SF $27.58 Grantee QMV III Santa Rosa Holdings Sale Verification Source Ron Reinking Document# 32020 Sale Data Source Listing Agent
Acres 9.91 Site Status Finished
Land SF 431,680 Entitlements Entitled
Usable Acres 8.91 Topography Level
Usable Land SF 388,120 Utilities All Public Utilities
Zoning TV-R-RC Shape Irregular
GP Designation Transit Village Medium Improvements of Value See Comments Comparable 4
Transaction
Site
Sale Comments
This site comprises of the majority of the site previously developed as the Journey's End Mobile Home Park, which was destroyed in the 2017 wildfire. The address of the larger site was 3575 Mendocino Avenue, but the Renaissance Way address shown for this parcel by the Assessor is used here, The larger site is located within a Priority Development Area, and this parcel was ultimately approved for redevelopment with 260 market rate apartments. Buyer is a dba of Lennar Homes. In addition to the entitlements, the site sold with building permits in place, which reportedly added ~$2,000 per unit to value, or $520,000. Interior streets were developed as part of the former mobile home park, but agent thought they had no value as developers intended to construct new streets. Developer will receive a 45% park fee credit but has to develop a 1.00 acre park. Given the fees and estimated park costs, the buyer will likely get a net benefit of ~$1.1 million.
An overall deduction of $1.62 million is therefore made to reflect the value of the permits and fee credits, net of the park development cost. Site was not publicly marketed, agent stated that the seller asked him to reach out directly to strong buyers. Site was placed in contract in September 2021. Park area is deducted from usable area, but density reflects gross area given the impact of this common recreational area in the project. 344 of 387
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ID 12477
Address 4614 Old Redwood Highway
City Santa Rosa
State CA
Zip 95403
County Sonoma
Latitude 38.498058
Longitude -122.748167
Tax ID 058-071-015
Property Major Type Land
Property Type Multi-Family
Property Type Multi-Family Date 1/31/2024
Address 4614 Old Redwood Highway Transaction Type Closed Sale City Santa Rosa Days on Market 140
County Sonoma Actual Price $1,800,000
State CA Price Adjustment $0
Tax ID 058-071-015 Price $1,800,000
Grantor JJP Redwood, LLC Price per Usable Land SF $41.32 Grantee Sonoma Land Trust Sale Verification Source John McCaull Document# 4650 Sale Data Source Buyer
Acres 1.00 Site Status Raw
Land SF 43,560 Entitlements Nearly Entitled
Usable Acres 1.00 Topography Level
Usable Land SF 43,560 Utilities All Public Utilities
Zoning PF, VOH Shape Irregular
GP Designation Public/Quasi-Public Improvements of Value None Comparable 5
Transaction
Site
Sale Comments
Site had been developed as a preschool, but the former school improvements were destroyed in the 2017 wildfires. The owners re-zoned to add a Workforce Housing overlay, and sought to entitle the site for Redwood West Residences, a 40 unit apartment project to include 32 market rate and 8 affordable units. Site was listed for $2 million and generated several offers around $1.4 to $1.6 million, but Sonoma Land Trust ultimately purchased for $1.8 million as shown above.
An appraisal in March 2023 had concluded a value of $1.6 million, based on $50,000 per nearly (at that time) entitled unit for the 32 market rate units. However, the buyers agreed to pay more since they felt the situation was urgent given the other offers, and since they felt it was "not that much" above market. A downward sale conditions equating to $200,000 is considered to be indicated. Closing would typically effectively reflect full entitlements, but the sellers suspended their entitlement application as a condition of going into escrow, as this buyer intended to transfer the purchase rights in escrow to a new non-profit (The Mark West Area Community Fund) which will operate the site as a public park. There were partial sidewalks, curbs and gutters along the frontage, but new frontage improvements would be required, and site is analyzed as most similar to raw land. Given the mix of market rate and affordables, only the 32 market rate units would be expected to have value for the typical developer-buyer, and sale is analyzed on that basis, although density reflects entire project. 345 of 387
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ID 13780
Address 310 E D Street
City Petaluma
State CA
Zip 94952
County Sonoma
Latitude 38.2360269
Longitude -122.634512
Tax ID 007-153-002
Property Major Type Land
Property Type Mixed Use
Property Type Mixed Use Date 11/15/2023
Address 310 E D Street Transaction Type Closed Sale
City Petaluma Days on Market 279
County Sonoma Actual Price $325,000
State CA Price Adjustment $0
Tax ID 007-153-002 Price $325,000
Grantor McNear LT Price per Usable Land SF $31.25
Grantee Lind 2016 Family Trust Sale Verification Source Timo Rivetti Document# 56516 Sale Data Source Listing Agent
Acres 0.24 Site Status Finished
Land SF 10,400 Entitlements Unentitled
Usable Acres 0.24 Topography Level
Usable Land SF 10,400 Utilities All Public Utilities
Zoning MU2 Shape Roughly rectangular
GP Designation Mixed Use Improvements of Value None
Comparable 6
Transaction
Site
Sale Comments
This is the sale of a small mixed-use zoned lot east of downtown and near to the SMART station. The property was listed for $500,000 but sold at the above price to a neighbor that owns the adjacent warehouse and a vacant parcel. The buyer plans to use it as storage.
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ID 12456
Address 1601 Petaluma Boulevard South
City Petaluma
State CA
Zip 94952
County Sonoma
Latitude 38.228428
Longitude -122.61732
Tax ID 019-210-010, -038 & -039
Property Major Type Land
Property Type Multi-Family
Property Type Multi-Family Date 4/3/2023
Address 1601 Petaluma Boulevard South Transaction Type Closed Sale City Petaluma Days on Market N/A
County Sonoma Actual Price $1,200,000
State CA Price Adjustment $25,000
Tax ID 019-210-010, -038 & -039 Price $1,225,000
Grantor South Petaluma Partners Price per Usable Land SF $15.80 Grantee BHDC Petaluma River Place Sale Verification Source Rich Wallach Document# 13878 Sale Data Source Buyer
Acres 3.47 Site Status Raw
Land SF 151,153 Entitlements Contingent Upon Entitlements Usable Acres 1.78 Topography Level To Gently Sloping
Usable Land SF 77,537 Utilities All Utilities Available Zoning MU1A, FP-C Shape Irregular
GP Designation Mixed Use Improvements of Value None
Comparable 7
Transaction
Site
Sale Comments
This site consists of three parcels which were industrially-zoned when placed into contract around June of 2020, but Burbank Housing is the buyer and effectively closed contingent upon funding (analogous to entitlements given the deal structure) for a 50-unit affordable apartment complex in a project known as Petaluma River Place. Assessor lists a total of 181,058 square feet or 4.16 acres, but planning documents show a gross site area of 3.47 acres which is to be more accurate, The site features extensive Petaluma River frontage and the buyer indicated that given the need to dedicate portions along the river and for a future bridge, there were 1.78 developable acres. No biotics mitigation was required given the plan to dedicate. Price is adjusted for an option extension payment not credited to the price. Contract was reached around June of 2020, and price may have been slightly low given changing market conditions in the interim and how development was going to be more expensive given the soils issues next to the river. Density equates to 27.5 units per usable acre (for psf analysis) and 14.4 units per gross acre (for per unit analysis, since dedicated areas provide privacy buffer).
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Land Comparable Map
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Comparable Summary and Adjustments
Address
City
County
Date
Transaction Type
Actual Price
Price Adjustment
Adjusted Price
Usable Land SF
Price Per SF
Transaction Adjustments
Property Rights Fee Simple 0% Fee Simple 0% Fee Simple 0% Fee Simple 0% Fee Simple 0% Fee Simple 0% Fee Simple 0% Financing Cash To Seller 0% Cash To Seller 0% Cash to Seller 0% Cash To Seller 0% Cash To Seller 0% Cash to Seller 0% Cash To Seller 0% Conditions of Sale None 0% None 0% None 0% None 0% Above Market -11% None 0% None 0% Months Since Sale
Market Trends Thru Jul-25 0%
Characteristics Adjustments
Location
% Adjustment
Qualitative
$ Adjustment
Usable Acres
% Adjustment
Qualitative
$ Adjustment
Topography
% Adjustment
Qualitative
$ Adjustment
Zoning
Zoned Density
% Adjustment
Qualitative
$ Adjustment
Site Status
% Adjustment
Qualitative
$ Adjustment
Entitlements
% Adjustment
Qualitative
$ Adjustment
Site Utility
% Adjustment
Qualitative
$ Adjustment
Adjusted Price/SF
Net Adjustments
Gross Adjustments
Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Comp 6 Comp 7
Depot Way Santero Way 210 Shiloh Road 710 Kawana Springs Road 561 Renaissance Way 4614 Old Redwood Highway 310 E D Street 1601 Petaluma Boulevard South
Cotati Cotati Windsor Santa Rosa Santa Rosa Santa Rosa Petaluma Petaluma Sonoma Sonoma Sonoma Sonoma Sonoma Sonoma Sonoma Sonoma 7/1/2025 N/A N/A 4/1/2025 7/13/2023 1/31/2024 11/15/2023 4/3/2023 Pending Contract Pending Contract Closed Sale Closed Sale Closed Sale Closed Sale Closed Sale $4,750,000 $3,250,000 $1,300,000 $12,325,000 $1,800,000 $325,000 $1,200,000 $0 $262,500 $0 -$1,620,000 $0 $0 $25,000
$4,750,000 $3,512,500 $1,300,000 $10,705,000 $1,800,000 $325,000 $1,225,000 24,394 104,951 214,818 65,340 388,120 43,560 10,400 77,537 $45.26 $16.35 $19.90 $27.58 $41.32 $31.25 $15.80
Fee Simple
Conventional
None
Adjusted Price/SF $45.26 $16.35 $19.90 $27.58 $36.73 $31.25 $15.80 N/A N/A 3 24 17 20 27
0% 0% 0% 0% 0% 0% 0%
Adjusted Price/SF $45.26 $16.35 $19.90 $27.58 $36.73 $31.25 $15.80 Cotati Cotati Windsor Santa Rosa Santa Rosa Santa Rosa Petaluma Petaluma -5% -5% -20% -20% -25% -25% -20%
Superior Superior Superior Superior Superior Superior Superior -$2.26 -$0.82 -$3.98 -$5.52 -$9.18 -$7.81 -$3.16
0.56 2.41 4.93 1.50 8.91 1.00 0.24 1.78
5% 10% 5% 10% 5% -10% 5%
Inferior Inferior Inferior Inferior Inferior Superior Inferior $2.26 $1.64 $0.99 $2.76 $1.84 -$3.13 $0.79
Level But Mounds To Grade Level Level Level Level Level Level Level To Gently Sloping -5% -5% -5% -5% -5% -5% 0%
Superior Superior Superior Superior Superior Superior Similar -$2.26 -$0.82 -$0.99 -$1.38 -$1.84 -$1.56 $0.00
SW SPSW BC RR-20 TV-R-RC PF, VOH MU2 MU1A, FP-C
25.0 - 35.0 40.7 16.0 - 32.0 18.0 26.2 40.0 30.0 27.5
-5% 0% 20% 10% -5% 5% 10%
Superior Similar Inferior Inferior Superior Inferior Inferior -$2.26 $0.00 $3.98 $2.76 -$1.84 $1.56 $1.58
Raw Raw Raw Raw Finished Raw Finished Raw
0% 0% 0% -5% 0% -5% 0%
Similar Similar Similar Superior Similar Superior Similar $0.00 $0.00 $0.00 -$1.38 $0.00 -$1.56 $0.00
Unentitled Entitled Contingent Upon
Entitlements
Unentitled Entitled Nearly Entitled Unentitled Contingent Upon Entitlements
-30% -15% 0% -30% -25% 0% -15%
Superior Superior Similar Superior Superior Similar Superior -$13.58 -$2.45 $0.00 -$8.27 -$9.18 $0.00 -$2.37
Average Average Fair-Avg - Biotics Average Average Average Average Fair - Riverfront Soils 0% 5% 0% 0% 0% 0% 15%
Similar Inferior Similar Similar Similar Similar Inferior $0.00 $0.82 $0.00 $0.00 $0.00 $0.00 $2.37
$27.16 $14.72 $19.90 $16.55 $16.53 $18.75 $15.01
-40% -10% 0% -40% -55% -40% -5%
50% 40% 50% 80% 65% 50% 65%
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Analysis and Conclusions
Economic adjustments are made as follows:
Adjustments To Price: Comparable 2 is adjusted upward for biotic mitigation costs.
Comparable 4 is adjusted downward for the value of permits and fee credits, net of extraordinary park development costs. Comparables 7 is adjusted upward for option extension payments not credited to the purchase price.
Real Property Rights Conveyed: A transaction price is always predicated on the real property interest conveyed. In the case of the comparable sales, all the sales sold as fee simple interests, the appraised subject site interest, and thus, no real property rights adjustments are required.
Financing Terms: All of the sales utilized were sold all cash to the seller, and thus no cash equivalency adjustments were required.
Conditions of Sale: Adjustments for conditions of sale usually reflect the motivations of the buyer and the seller. When non-market conditions of sale are detected in a transaction, an adjustment may be required. The market for the subject property is sufficiently active so that, with one exception, there were no unusual market conditions or atypical motivations during the period in which the sales occurred that would require an adjustment.
Comparable 5 was purchased by Sonoma Land Trust, which was to transfer title in escrow to a new non-profit which will operate this site as a public park. The sellers were on the verge of completing entitlements for a 40-unit affordable apartment project, and had received several offers from developers, reportedly for as much as $1.6 million. The site had appraised for $1.6 million as well, but the buyers offered $1.8 million since they really wanted the site and wanted to head off the competition. A downward sale conditions adjustment equating to $200,000 (and shown in the preceding table as negative 11%) is thus considered to be indicated for the buyers’ unusual motivation.
Market Conditions: Comparable sales that occurred under different market conditions than those applicable to the subject on the date of value require adjustment for any differences that affect their values. This set of comparables consists of two pending escrows and five sales which closed between April 2023 and April 2025. While interest rates began increasing around April 2022 and market participants indicate that properties have since then generally taken longer to sell, values for development land have generally been static over this period, although deal volume is down. A number of new apartment projects are still being developed across Sonoma County, and rents have continued to rise modestly while market vacancy is still low.
The rent growth is generally offset by capitalization rate growth, although these rates appear to have stabilized recently. In the end, we have forecast neither appreciation nor depreciation for the relatively recent period during which these sales closed.
All of the comparables feature access to all public utilities, as the subject features. Further adjustments for material differences between the subject and comparable sales are described as follows. Note that as regards adjustments for size, developers will generally pay more for smaller sites (on a per square foot or per unit basis), all other attributes being equal, although 350 of 387 Depot Way, Cotati
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the effect of this can be mitigated to an extent by the greater opportunities for economies of scale associated with larger projects. The subject is small enough that it would be of interest to small builders, but would be more challenging than some to develop profitably on its own as it would not support enough units to allow for significant economies of scale. Also note that size refers not simply to the physical size of a site but also the investment magnitude. Still, the much smaller pool of potential buyers for very large projects places downward pressure on their unit prices.
Additionally, whereas in a price per unit comparison, a higher density is an inferior attribute (as developers will typically pay more per unit for larger units to be developed at a lower density), in a price per square foot comparison such as this one, a higher density is a superior attribute (as developers will typically pay more per square foot for sites that can be developed to a higher intensity).
Finally, adjustments to the comparables for entitlements are based on an analysis of entitlement costs and paired sales of land with and without entitlements, as well as discussions with market participants and the appraisers’ experience. Below, the appraisers have described details of two paired sales; while both of them reflect sales of single- rather than multi-family residential land, they are nonetheless considered to provide strong support for the adjustments. The subject lacks entitlements whereas a number of the comparables either sold with entitlements in place or effectively had some level of entitlement contingencies in effect. • The first is the January 2021 sale of a 4.49 gross acre site at 250 Casa Grande Road in Petaluma. DRG Builders placed this site in contract in February 2019 for $2.8 million with no entitlement contingencies and a 12 month due diligence/entitlement period, but subsequently extended escrow by paying another $240,000, equating to a total purchase price of $3,040,000. By late 2020, they had obtained tentative map for 36 lots to be developed with detached homes, including five affordables, and thus closing was effectively considered contingent upon tentative map. DRG closed on January 14, 2021 for the $3,040,000, and then immediately flipped the entitled site to DeNova Homes on January 15, 2021, for $3,480,000, indicating 14.5% as the effective premium for securing tentative map as opposed to closing contingent upon tentative map. • The second is the July 2021 sale of a 3.36 gross acre site at 529 Madison Street in Petaluma. The sellers in the July 2021 sale, a dba of Urban Green Investors, had purchased this site in October 2018 for $1.8 million with no entitlement contingencies before selling it for $2,585,000 with tentative map in place for 27 homes. Given changing market conditions since then, it is estimated that the value rose by approximately 10% between October 2018 and July 2021, equating to a time-adjusted price for the first sale of $1.98 million. The remaining increase between the two selling prices, or $605,000, reflects 31% growth which is considered the effective premium for taking the unentitled site through to tentative map approval.
Comparable 1: This comparable, located in Cotati, represents a pending contract at a price of $45.26 per square foot. This site is located immediately southwest of the subject, but while the original 2023 contract which is still in effect is what is analyzed here, it is critical to note that the 351 of 387
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buyers have determined that the originally entitled project does not pencil at the contract price, even given their reported ability to generally build at a somewhat reduced cost compared to other developers. They are in the midst of negotiations to try and acquire additional property to build more units to help the project pencil. The listing agent, Erich Reichenbach, stated that the pricing of any expansion parcels would need to be incorporated into the overall project costs, and would need to be reduced from that of the original contract in order to make it feasible to develop. No other formal agreements have been reached, though, and so we have elected to analyze here the original contract with the understanding that the price is in all likelihood too high for even these experienced developer-buyers to close, and then discuss the ramifications of the current project status at the end of this section.
Despite the location directly adjacent the subject, a 5% downward adjustment has nonetheless been applied as the subject is located immediately next to the train station whereas the comparable site is removed from the station and extends farther west away from the tracks, allowing a much greater proportion of the units to eventually be built to be oriented away from the railroad. An upward adjustment of 5% is applied for the larger size. This comparable features level topography, and while the subject generally does as well, there are a couple of large soils mounds which would need to be graded, raising site development costs at least somewhat and placing downward pressure on the raw land value. A downward adjustment of 5% is made for this site’s superior level topography. The zoned density is actually similar to the subject’s but this site was placed in contract with approvals for an overall density of 40.7 units per acre, and a 5% downward adjustment is applied for the superior higher density. The subject lacks entitlements whereas this site actually had entitlements in place, and a downward adjustment of 30% is applied based on the rationale described above. A net adjustment of -40% and gross adjustment of 50% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $27.16 per square foot for the subject.
Comparable 2: This comparable, located in Windsor, represents a pending contract at a price of $16.35 per square foot. While it does back up to some pastureland, this site also features heavy traffic along Shiloh Road, has exposure to the freeway, and is situated near a shopping center anchored by Walmart and Home Depot. Given the subject’s location immediately next to the train station, though, the location is still regarded as slightly superior to the subject and a downward adjustment of 5% is applied. A 10% upward adjustment is made for the larger size.
A downward adjustment of 5% is made for this site’s superior level topography. The density range which provides for a maximum of 32.0 units per acre is roughly similar to the subject’s at
35.0 units per acre, and no adjustment is made for density. The buyers in this case were able to make closing contingent upon obtaining entitlements. Thus, while they are still responsible for the cost of designing the project and pursuing approvals, they were nonetheless able to remove significant risk. A 15% downward adjustment has been made to reflect the superior entitlement status. This site will require some biotic mitigation, and is subject to a creek setback requirement as well. While an adjustment has already been made for the projected cost of mitigation credits, and the usable site area has been reduced to reflect the setback, these factors indicate the need for a greater level of design planning, monitoring and oversight.
A 5% upward site utility adjustment has been made as a result. A net adjustment of -10% and gross adjustment of 40% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $14.72 per square foot for the subject. 352 of 387 Depot Way, Cotati
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Comparable 3: This comparable, located in Santa Rosa, represents a closed sale at a price of $19.90 per square foot. The location in an area of apartments and directly across from a retail power center is considered to warrant a downward adjustment of 20%. The larger size warrants an upward adjustment of 5%. A downward adjustment of 5% is made for this site’s superior level topography. At a maximum of 18.0 units per acre, the lower zoned density warrants a 20% upward adjustment. No net adjustment is made and a gross adjustment of 50% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $19.90 per square foot for the subject.
Comparable 4: This comparable, located in Santa Rosa, represents a closed sale at a price of $27.58 per square foot. This northeast section of Santa Rosa typically features higher property values than the other quadrants of the city, and this project features very good access virtually adjacent a freeway interchange as well as relatively good proximity to services. However, this project is bordered on one side by the freeway, on another side by an overcrossing, and on a third by a major commercial arterial. There will consequently significant visual and noise impacts given the very heavy surrounding traffic, but these will be offset to a degree by the sheer size of the project and the fact that a good number of units will be oriented inward rather than outward toward the surrounding roadways. Overall, a 20% downward adjustment is considered to be warranted for the superior location. An upward adjustment of 10% is applied for the larger size. A downward adjustment of 5% is made for this site’s superior level topography. The lower density warrants an upward adjustment of 10%. The superior site status as a finished lot warrants another 5% adjustment. Finally, this site sold with entitlements and a downward adjustment of 30% is applied. A net adjustment of -40% and gross adjustment of 80% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $16.55 per square foot for the subject.
Comparable 5: This comparable, located in the unincorporated area just north of the city of Santa Rosa, represents a closed sale at a price of $36.73 per square foot. The location is regarded as superior to the subject and a downward adjustment of 25% is applied. An upward adjustment of 5% is applied for the somewhat larger size. A downward adjustment of 5% is made for this site’s superior level topography. The sellers had nearly entitled the site for a project with a density of 40.0 units per acre, and a downward adjustment of 5% is applied for the somewhat higher density. Given the superior entitlement status with approvals nearly finished, a downward adjustment of 25% is applied. A net adjustment of -55% and gross adjustment of 65% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $16.53 per square foot for the subject.
Comparable 6: This comparable, located in Petaluma, represents a closed sale at a price of $31.25 per square foot. The location is very near downtown Petaluma and is just a couple of lots removed from Petaluma’s own SMART station. The centralization is very good, and this site is also located across East D Street from a large site designated for future development with the Haystack Landing mixed-use project, although this project has been approved for several years without having been built. The nature of the surrounding improvements, however, is generally industrial/heavy commercial, and the train tracks are just a couple of lots removed from this one. Still, a 25% downward adjustment has been made given the potential/projected scope of redevelopment for this area and Petaluma’s higher values. A downward adjustment of 10% is 353 of 387 Depot Way, Cotati
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applied for the smaller size. A downward adjustment of 5% is made for this site’s superior level topography. The zoned maximum density of 30.0 units per acre warrants an upward adjustment of 5%. The site status as a finished lot with full street frontage improvements already in place should translate to slightly lower site development costs, and a downward adjustment of 5% is applied. A net adjustment of -40% and gross adjustment of 50% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $18.75 per square foot for the subject.
Comparable 7: This comparable, located in Petaluma, represents a closed sale at a price of $15.80 per square foot. The location features Petaluma River frontage but the property is also situated directly along a major arterial and there are views of the elevated freeway in relatively close proximity. Given this as well as the nature of surrounding properties and the distance from downtown, and taking into account Petaluma’s generally higher property values, a downward adjustment of 20% is applied. The larger size warrants an upward adjustment of 5%.
The topography includes some slope and overall is considered similar to the subject’s. An upward adjustment of 10% is applied for the inferior lower density. The buyers closed contingent upon receiving funding approval, and given the processes involved, this is effectively similar to closing contingent upon entitlements, and so a downward adjustment of 15% is applied. This site was to most likely require a significant level of extraordinary engineering given the riverfront soils, and an upward adjustment of 15% is applied for the inferior site utility. A net adjustment of -5% and gross adjustment of 65% is applied as discussed in the analysis above. Overall, this comparable indicates a value of $15.01 per square foot for the subject.
Market Value Conclusion
The table below presents a summary of the comparable sales before and after adjustment.
Ranges and Reconciled Value
Number of Comparables: 7 % Δ
-7%
-40%
-35%
-40%
Reconciled Value/Unit Value: $27.58 $1,800,000.00 $18.50 usable land sf Usable Land SF: 24,394
Indicated Value: $451,282
Unadjusted Adjusted
Low: $15.80 $14.72
High: $45.26 $27.16
Average: $28.21 $18.37
Median: $27.58 $16.55
Reconciled Final As Is Value: $450,000
Comparable 1, located immediately adjacent to the subject and with the same zoning, would typically be considered the best comparable. Unfortunately, in this case, this is a current contract wherein the buyers are reportedly in the process of trying to add additional parcels at a reduced price in order to help the larger project pencil. With an adjusted value indication of $27.16 per square foot, this is much higher than any other comparable, but this is actually to be reasonable and even expected given the preceding discussion of this escrow’s history and how the buyers are experienced developers who nevertheless do not feel the project as originally entitled is feasible to develop at the contract price. (Recall that this entitled project also 354 of 387
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featured a 15% inclusionary requirement for affordable units, and so the effective price for just the pro rata share of the site designated for market rate housing would be even higher.) We would have preferred to analyze their current proposal, which calls for approximately 173 units on an expanded site of 3.37 acres (which includes the subject parcel as well as the westerly adjacent parcel), equating to a density of 51.3 units per acre which would be achievable by providing 15% of units as affordable to very low income households. However, the listing agent stated that there have been no agreements yet reached for other parcels, and also noted that the overall pricing would need to be adjusted downward, rather than simply paying a similar unit price to that of the original contract analyzed here, in order for the project to be feasible and a sale to occur.
Comparable 2, $14.72, is still in contract, and has also been assigned less weight as its reliability is weaker since the deal has not closed. Comparable 7 is also a slight outlier at $15.01 per square foot. As noted previously, this price may have been somewhat low given improving market conditions since the site was actually placed in contract in 2020. Less weight is placed on this sale except to note the lower end of the value range. Comparable 5, $16.53 per square foot, was not actually purchased for apartment development but featured strong interest from developers before Sonoma Land Trust acquired it. It was entitled for 32 market rate units and 8 affordable units, and given how market rate developers would not allocate residual land value to the affordable units, the effective unit price for the market rate portion of the site would actually be somewhat higher.
The other sales range narrowly from $16.55 to $19.90 per square foot and have an average of $18.40 per square foot.
The subject site has some additional potential in that it could be developed with mixed commercial and residential uses, allowing for a greater intensity of overall development, particularly should a commercial tenant be secured that could conceivably benefit from anticipated traffic at the train station. While sites approved for development with 100% multifamily residential units would recently have been expected to feature superior demand in the current market wherein most developers would prefer to simply build a single product type, retail vacancy has slowly declined in recent years while apartment vacancy has slowly risen, and the location adjacent the train station would feature significant traffic despite the subject site’s lack of much exposure to East Cotati Avenue. However, it is also noted that while size adjustments have been made based largely on the larger pool of potential buyers for smaller sites and on the economics of diminishing incremental returns for each subsequent unit of size, the subject is small enough that potential site development design plans could be somewhat limited in terms of what projects that the site could actually support would be able to pencil.
Finally, and while the impact of this is considered to be modest, a portion of the site along its eastern boundary will need to be dedicated as a future access route. While this will not result in any lessening of the potential intensity of development, since permissible density in Cotati is based on gross site area, it will result in the need for those units to be clustered to a greater degree on the physically developable portion of the site, thus creating a slightly more crowded project and possibly lessening its appeal marginally.
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Overall, these factors are considered relatively offsetting, and based on the preceding analysis, a reasonable value indication for the subject site is considered to be roughly at the midpoint of the predominant range, or $18.50 per square foot. The subject’s indicated value via the Sales Comparison Approach can therefore be calculated as shown in the preceding table.
It is also noted that at the 18,295 square foot site at 950 East Cotati Avenue, at the southeast intersection of East Cotati Avenue and Santero Way just a couple of lots north of the subject, there is a sign listing this parcel for sale. However, during the course of this assignment the appraisers confirmed with Laura Duffy, one of the listing agents, that the sign was an old one and that she had not marketed the site in at least a couple of years. She stated that the site was listed at the height of COVID, and that the City of Cotati (which owns the site) was requiring a commercial component. Given the state of the retail market at this time, this dissuaded a number of potential buyers. Ms. Duffy stated that the site had been priced at $400,000, or $21.86 per square foot, and that she had some strong interest from multiple parties more around the low- to mid- $300,000 range. She noted that the small size was also an issue as it would not allow for large enough of a development to pencil. An estimated price of $350,000 would equate to $19 per square foot, and given the fact that the subject site could conceivably be developed with 100% residential uses whereas the site at 950 East Cotati Avenue could not, while noting that 950 East Cotati Avenue features markedly superior commercial exposure, this is also considered supportive of the concluded value for the subject.
The appraisers have also analyzed the subject and comparables on the basis of price per unit.
The following table reflects the prices as well as all of the preceding adjustments shown in the sales and adjustments table with the exception of the adjustments for density. This is because developers will pay more on a per square foot basis for sites that can be developed to a greater intensity, but less on a per unit basis. The table thus shows each of the comparables’ respective price per unit, adjusted for everything except density. Recall that based on the discussion appearing previously, Comparables 1 and 5 are analyzed based on their overall density of 40.7 and 40.0 units per acre, respectively, but the per unit pricing is based only on the 83 and 32 market rate units respectively featured in these projects, as the affordable units would have no residual land value to the typical buyer for these sites.
Price Per Unit Analysis
Comparable 1 2 3 4 5 6 7
Time-Adjusted Price $4,750,000 $3,512,500 $1,300,000 $10,705,000 $1,600,000 $325,000 $1,225,000 Adjustments (Excl. Density) -35% -10% -20% -50% -50% -45% -15% Adjusted Price $3,087,500 $3,161,250 $1,040,000 $5,352,500 $800,000 $178,750 $1,041,250 Number Of Units 83 158 27 233 32 7 49
Adjusted Price Per Unit $37,199 $20,008 $38,519 $22,972 $25,000 $25,536 $21,250 Density (DU/AC) 40.7 32.0 18.0 26.2 40.0 30.0 27.5
The subject is analyzed based on its maximum potential density of 35.0 units per acre. As shown in the preceding table, the inverse correlation between density and price per unit is consistent, although not absolute. The comparables range from $20,008 to $38,519 per potential unit, with Comparable 3, the high indicator, having by far the lowest density at 18.0 units per acre. Comparable 2 is the low indicator despite having a density of up to 32.0 units per acre, but this was also the low indicator in the preceding analysis and the price may simply be somewhat low. Comparable 1, $37,199 per unit, has already been discussed and this 356 of 387
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contract price is considered higher than the market (as well as specifically the current contract holders) will support.
The other sales range from $21,250 to $25,536 per unit and feature densities ranging from 26.2 to 40.0 units per acre. The subject’s maximum density of 35.0 units per acre falls within this range and thus a reasonable value would be projected to fall within this range. Given the estimated maximum of 19.6 units for the subject at a maximum of 35.0 units per acre, a figure which would be rounded up to 20 per city officials, the concluded base value indication of $18.50 square foot equates to $22,564 per potential unit for the subject. This value is toward the low end of the predominant range, which is reasonable as the subject’s density is toward the high end of the predominant range. This analysis thus strongly supports the value conclusion.
The market value of the Fee Simple interest of the property, as is, as of July 1, 2025, is therefore estimated to be $450,000.
Marketing & Exposure Period
The comparables indicated the following marketing periods.
Comparable Marketing Periods
Comp
Months on
Market
1 12.0
2 53.2
3 2.5
4 24.0
5 4.6
6 9.2
7 N/A
Minimum 2.5
Maximum 53.2
Average 17.6
Median 10.6
Based on the above a marketing period of 6 to 12 months is concluded. Also, based on these comparables an exposure period of 6 to 12 months is concluded. 357 of 387
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CERTIFICATION OF ROBERT A. HORNING, MAI
I certify, to the best of my knowledge and belief, that
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial unbiased professional analyses, opinions and conclusions.
3. I have no present or prospective interest in the property that is the subject of this report, and no personal interest with respect to the parties involved.
4. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.
5. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, a requested minimum valuation, a specific valuation, the attainment of a stipulated result or the occurrence of a subsequent event directly related to the intended use of this appraisal.
6. The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal Institute.
7. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
8. My engagement in this appraisal assignment was not contingent upon developing or reporting predetermined results.
9. I have made a personal inspection of the property that is the subject of this report.
10. No one provided significant professional assistance to the person signing this report.
11. This appraisal report conforms to the current Uniform Standards of Professional Appraisal Practice (USPAP).
12. I meet all of the requirements of the Competency Provision of the current Uniform Standards of Professional Appraisal Practice (USPAP).
13. As of the date of this report, I have completed the continuing education program for Designated Members of the Appraisal Institute.
14. I have not performed or provided any services regarding this property in the three-year period immediately preceding the agreement to perform the assignment. _____________________________
Robert A. Horning, MAI
State of California Certified
General Real Estate Appraiser
BREA License Number AG028396
Expiration: October 18, 2025
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CERTIFICATION OF RYAN C. WARD, MAI
I certify, to the best of my knowledge and belief, that
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial unbiased professional analyses, opinions and conclusions.
3. I have no present or prospective interest in the property that is the subject of this report, and no personal interest with respect to the parties involved.
4. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.
5. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, a requested minimum valuation, a specific valuation, the attainment of a stipulated result or the occurrence of a subsequent event directly related to the intended use of this appraisal.
6. The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal Institute.
7. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
8. My engagement in this appraisal assignment was not contingent upon developing or reporting predetermined results.
9. I have made a personal inspection of the property that is the subject of this report.
10. No one provided significant professional assistance to the person signing this report.
11. This appraisal report conforms to the current Uniform Standards of Professional Appraisal Practice (USPAP).
12. I meet all of the requirements of the Competency Provision of the current Uniform Standards of Professional Appraisal Practice (USPAP).
13. As of the date of this report, I have completed the continuing education program for Designated Members of the Appraisal Institute.
14. I have not performed or provided any services regarding this property in the three-year period immediately preceding the agreement to perform the assignment. _____________________________
Ryan C. Ward, MAI
State of California Certified
General Real Estate Appraiser
BREA License Number AG026338
Expiration: December 22, 2026
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122 Calistoga Road, #364
Santa Rosa, CA 95409
(707) 921-5053
[email protected]
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QUALIFICATIONS OF ROBERT A. HORNING, MAI
Education
Boston University, Boston, Massachusetts
• Bachelor of Science, Business Administration – summa cum laude • Winner of Albert Grace Prize, Dubofsky Real Estate Prize Santa Rosa Junior College, Santa Rosa, California
• Commercial Real Estate Appraisal
• Principles of Real Estate
Appraisal Institute
• Basic and Advanced Income Capitalization
• Small Hotel/Motel Valuation
• Standards of Professional Practice
• Business Practices and Ethics
• Anatomy of Residential Housing
• Highest & Best Use and Market Analysis
• Appraisal Consulting
• Going Concern Valuation
• Analyzing Commercial Lease Clauses
• Advanced Concepts & Case Studies
Appraisal Experience
Partner with the independent real property valuation services firm of Ward Levy Appraisal Group, Inc. (2014 – present)
Senior Appraisal Associate with the independent real property valuation and right of way acquisition services firm of Howard Levy Appraisal Group, Inc., formerly Hornsby Levy Appraisal Group, Inc. (2002 – 2014)
Appraiser with the independent real property valuation and right of way acquisition services firm of G.F. Hornsby and Associates in Santa Rosa, California (1995 – 2002) Twenty-nine years of experience that includes preparation of narrative appraisal reports on unimproved lands, easements, single and multi-family residential developments, PUD subdivisions, professional and medical office buildings, retail buildings, shopping centers, light industrial buildings, restaurants, churches, funeral homes, lodging, automobile dealerships, and related work involving full and partial acquisitions for government agencies.
Professional Affiliations
Appraisal Institute (MAI) - Continuing Education Requirements Completed Licensure
California Certified General Real Estate Appraiser, License AG028396, Expires October 18, 2025 360 of 387
122 Calistoga Road, #364
Santa Rosa, CA 95409
(707) 921-5052
[email protected]
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QUALIFICATIONS OF RYAN C. WARD, MAI
Education
University of California – San Diego, California
• Bachelor of Arts, Economics
• Bachelor of Arts, Urban Studies and Planning
Appraisal Institute
• Capitalization Theory
• Real Estate Valuation Theory
• Vineyard Valuation
• Highest and Best Use and Market Analysis
• Advanced Income Capitalization
• Advanced Cost and Sales Comparison Approach
• Advanced Applications
• Business Practice & Ethics
• Report Writing and Valuation Analysis
• Introduction to Green Buildings
• Residential and Commercial Valuation of Solar
• Case Studies in Appraising Green Commercial Buildings • The Appraiser as Expert Witness
• Condemnation Appraising: Principles & Applications
Appraisal Experience
President of Ward Levy Appraisal Group, Inc., an independent real property valuation services firm (2017 – Present)
Partner, Ward Levy Appraisal Group, Inc., an independent real property valuation services firm (2014 – 2016)
Senior Appraisal Associate with the independent real property valuation and right of way acquisition services firm of Howard Levy Appraisal Group, Inc., formerly Hornsby Levy Appraisal Group, Inc. (2004 – 2014)
Project Manager with the independent real property valuation firm of Carneghi-Blum & Partners, Inc. (Formerly Carneghi-Bautovich & Partners, Inc.), San Francisco, California (1996 – 2004) Twenty-eight years of experience that includes preparation of narrative appraisals for a variety of property types including single-family residential subdivisions, multi-family housing, office buildings, industrial properties, shopping centers, marinas, retail centers, hotels, lodging facilities, auto service stations and special uses.
Professional Affiliations
Appraisal Institute (MAI) - Continuing Education Requirements Completed Licensure
California Certified General Real Estate Appraiser, License AG026338, Expires December 22, 2026 361 of 387
ADDENDA
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National Flood Hazard Layer FIRMette
0 250 500 1,000 1,500 2,000
Feet
Ü
SEE FIS REPORT FOR DETAILED LEGEND AND INDEX MAP FOR FIRM PANEL LAYOUT
SPECIAL FLOOD
HAZARD AREAS
Without Base Flood Elevation (BFE)
Zone A, V, A99
With BFE or Depth Zone AE, AO, AH, VE, AR
Regulatory Floodway
0.2% Annual Chance Flood Hazard, Areas
of 1% annual chance flood with average
depth less than one foot or with drainage
areas of less than one square mile Zone X
Future Conditions 1% Annual
Chance Flood Hazard Zone X
Area with Reduced Flood Risk due to
Levee. See Notes. Zone X
Area with Flood Risk due to Levee Zone D
NO SCREEN Area of Minimal Flood Hazard Zone X
Area of Undetermined Flood Hazard Zone D
Channel, Culvert, or Storm Sewer
Levee, Dike, or Floodwall
Cross Sections with 1% Annual Chance
17.5 Water Surface Elevation
Coastal Transect
Coastal Transect Baseline
Profile Baseline
Hydrographic Feature
Base Flood Elevation Line (BFE)
Effective LOMRs
Limit of Study
Jurisdiction Boundary
Digital Data Available
No Digital Data Available
Unmapped
This map complies with FEMA's standards for the use of
digital flood maps if it is not void as described below.
The basemap shown complies with FEMA's basemap
accuracy standards
The flood hazard information is derived directly from the authoritative NFHL web services provided by FEMA. This map was exported on 6/25/2025 at 12:51 AM and does not
reflect changes or amendments subsequent to this date and time. The NFHL and effective information may change or
become superseded by new data over time.
This map image is void if the one or more of the following map elements do not appear: basemap imagery, flood zone labels, legend, scale bar, map creation date, community identifiers, FIRM panel number, and FIRM effective date. Map images for unmapped and unmodernized areas cannot be used for
regulatory purposes.
Legend
OTHER AREAS OF
FLOOD HAZARD
OTHER AREAS
GENERAL
STRUCTURES
OTHER
FEATURES
MAP PANELS
8 B
20.2 The pin displayed on the map is an approximate
point selected by the user and does not represent
an authoritative property location.
1:6,000
122°41'47"W 38°20'4"N
122°41'10"W 38°19'36"N
Basemap Imagery Source: USGS National Map 2023
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Cotati City Council
Agenda Staff Report
Item type: REGULAR AGENDA (ACTION)
To: City Council
Subject: NOR CAL OAKS LICENSE AGREEMENT AMENDMENT
Date: January 13, 2026
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council adopt a resolution approving the amended license agreement with NorCal Oaks for the use of Putnam and Cator Fields and the related budget amendment.
Background
On May 9, 2023, the City Council approved the original license agreement with Nor Cal Oaks.
Following approval of the license agreement, Nor Cal Oaks invested far in excess of the committed $577,588 during the first two (2) years of the License to improve the fields. These improvements resurrected the fields from essentially unusable to among the best fields in Sonoma County. The License required Nor Cal Oaks to fully maintain the fields, pay all utility costs for the field, and make an annual payment to the City.
The original funders are no longer with the organization, and Nor Cal Oaks no longer has access to the financial reserves it had previously. Therefore, the current representatives approached the City to request a change in terms to preserve the viability of baseball and softball programs for youth in the community at a reasonable cost. In particular, a change to the annual payment and cost of water was requested. Staff were also interested in modifying some terms of the agreement to clarify some terms with the operational experience and to ensure the issue with locked gates would not re-appear.
Analysis/Discussion
The proposed edits are mostly unremarkable changes proposed to clarify roles and responsibilities now that the City has operational experience with the new fields. The same basic 364 of 387
arrangement and term remain unchanged; Nor Cal Oaks is responsible for maintaining the fields at a high level in exchange for first right to schedule games or practices. The focus of the discussion with NorCal Oaks was to find an arrangement that kept the youth programming viable and keeps field maintenance with operators that know how to best maintain these specialized facilities at a high level for the community at no cost.
The notable changes include:
• The fields must remain unlocked, except if the fields are too wet from heavy rainfall for play (to avoid damage).
• Sponsor signs must be removed annually after every baseball season and are inward facing only.
• Reducing annual payment requirements.
• The City would assume responsibilities for the cost of water, provided that monthly water use stays within 10% of prior year 3-month averages.
Financial Considerations
The proposed changes will increase the cost to the parks budget in the General Fund. The most significant cost is the water usage to irrigate the turf. The total annual cost of irrigation for the field at Putnam has been approximately $9,500 and $11,5000 at Cator Field. These were previously partially paid by Nor Cal Oaks but would revert to fully funded by the City under this amended license agreement. However, the costs associated with maintaining and repairing the baseball fields would continue to be paid for by Nor Cal Oaks. As such, a budget amendment is being proposed to increase the water costs for general fund parks expenditures in the amount of $5,800 for fiscal year 2025/26 and $14,600 for fiscal year 2025/26.
Environmental Issues
Where it can be determined with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA review.
This general rule can be applied to activities which could be subject to the CEQA process, but which logic dictates should not be subject to CEQA review. Therefore, based on the information provided above, the proposed resolution is exempt from CEQA pursuant to Section 14.03.021 of the CEQA Guidelines in that there is no possibility that the activity may have a significant impact on the environment.
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RESOLUTION NO. (XX)
RESOLUTION OF THE CITY OF COTATI APPROVING AN AMENDED LICENSE
AGREEMENT WITH NOR CAL OAKS FOR THE USE OF PUTNAM AND CATOR
FIELDS AND APPROVING A RELATED BUDGET AMENDMENT
WHEREAS, on May 9, 2023, the City Council approved a license agreement with Nor Cal Oaks for the use, operation, and maintenance of the Putnam and Cator Fields, under which Nor Cal Oaks invested substantially more than the originally committed amount to rehabilitate and significantly improve the fields; and
WHEREAS, Nor Cal Oaks has requested amendments to the license agreement due to changes in its funding structure to maintain the viability of youth baseball and softball programming for the community; and
WHEREAS, the proposed amended license agreement maintains the original term and overall structure, clarifies operational responsibilities, and includes changes related to field access, signage, annual payment requirements, and the assumption of water costs by the City subject to usage limitations; and
WHEREAS, under the amended agreement, Nor Cal Oaks will continue to fully fund and perform specialized field maintenance and repairs, preserving a high level of field quality for public benefit at no cost to the City for maintenance services; and WHEREAS, approval of the amended license agreement requires a related budget amendment to the General Fund Parks budget to account for the City’s assumption of irrigation water costs.
NOW THEREFORE BE IT RESOLVED, by the City Council of the City of Cotati that:
1. The City Council hereby approves the amended License Agreement with Nor Cal Oaks for the use, operation, and maintenance of Putnam and Cator Fields, substantially in the form presented, subject to minor administrative or non-substantive changes approved by the City Manager and City Attorney.
2. The City Manager is authorized and directed to execute the amended License Agreement on behalf of the City.
3. The City Council approves a budget amendment to the General Fund Parks budget to increase irrigation water expenditures to reflect the City’s assumption of water costs under the amended agreement.
4. This Resolution shall take effect immediately upon adoption.
IT IS HEREBY CERTIFIED that the foregoing resolution was duly adopted at a regular meeting of the City Council of the City of Cotati held on January 13, 2026, by the following vote, to wit:
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Approved:___________________________
Mayor
Attest:______________________________
Kevin Patterson, Deputy City Clerk
Approved as to form:______________________________
City Attorney
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1 AMENDED AND RESTATED LICENSE AGREEMENT FOR USE OF
CATOR AND PUTNAM BASEBALL FIELDS OWNED BY THE CITY OF
COTATI
This License Agreement, revokable only as set forth in the termination provisions (herein referred to as the “Agreement” or “License”), is issued amended and restated this 9 th 13th day of
May January 20263 (“Effective Date”) by and between the City of Cotati, a California municipal corporation (the “City”) and Nor Cal Oaks, a California nonprofit corporation (the “Licensee”, hereinafter designated as “Nor Cal Oaks”). City and Nor Cal Oaks are hereinafter collectively referred to as the “Parties.”
RECITALS
WHEREAS, the City owns, operates and maintains Cator and Putnam Fields in the City of Cotati, which include baseball fields, fencing, backstop, dugouts, bleachers, restrooms, parking lots and snack shacks (collectively, the “Facilities” or “Facility”) as shown on Exhibit “A”, attached hereto and incorporated herein by reference; and WHEREAS, Nor Cal Oaks has committed an estimated $577,588 during the first twelve (12) months of the License, to improve the Facilities, as described in Exhibit “B”; and WHEREAS, the City Council approved the original license agreement with Nor Cal Oaks on May 9, 2023; and
WHEREAS, in 2023 and 2024, Nor Cal Oaks invested in excess of the estimated $577,588 during the first two (2) years of the License to improve the Facilities, as described in Exhibit “B”; and
WHEREAS, Nor Cal Oaks no longer has access to the financial reserves it had previously and has requested an amendment to this License to be able to continue to serve youth in the community with baseball and softball programs at a reasonable cost; and WHEREAS, the City expressly granted this License in exchange for a commitment by Nor Cal Oaks has also committed to continue a high level of maintenance of the fields, pay direct utility costs for the Cator Field snack shack and pay for water usage that materially exceeds a 3 month average of the prior year, as described further herein and a significant annual License payment to the City; and
WHEREAS, the City is agreeable to permitting Nor Cal Oaks to use the Facilities for the purpose of conducting youth baseball and softball activities, pursuant to the terms and conditions of this License set forth herein.
NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, the Parties agree as follows:
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2 1. License. The City hereby grants to Nor Cal Oaks a License to use the Facilities, subject to all the terms and conditions of this Agreement. Nor Cal Oaks shall incur an annual License Fee in the amount of five-thousand one dollars ($5,0001.00) payable to the City upon execution of the Agreement and annually thereafter during an Extension Term.
2. Non-Exclusive License. The License granted is non-exclusive. The City shall continue to maintain control of the Facilities including, without limitation, the right to grant additional licenses for use of the Facilities in its sole discretion, in consultation with Nor Cal Oaks at times not already scheduled for use by Nor Cal Oaks.
3. Term of License. The term of the
amended License shall commence on the Effective Date and shall continue through May 9th, 2033, unless City or Nor Cal Oaks terminates this License sooner (“Term”).
4. Use. Nor Cal Oaks’ use of the Facilities shall be limited and conditioned as follows:
a. Youth baseball and softball play, consistent with Nor Cal Oaks Rules and Regulations and responsible adult supervision at all times that the Facilities are in use by Nor Cal Oaks.
b. Use of the snack shack(s) for food service, as approved by the Sonoma County Health Department.
c. Storage of Nor Cal Oaks items in the snack shack(s) during the term of this Agreement. Upon request of the City, Nor Cal Oaks shall remove all stored items from snack shack(s) at the end of the Agreement. Storage of items is at Nor Cal Oaks’ sole risk.
d. Placement of semi-permanent banners and sponsor advertisements within baseball field fencing, provided, however, that Nor Cal Oaks shall remove all banners and advertising annually within two (2) weeks of the end of each baseball/softball seasonthe term of this Agreement. Banners shall be inward facing only (facing the licensed fields). Nor Cal Oaks will provide field banners for City of Cotati and Rancho Adobe Fire District at no charge for the life of the Agreement.
e. Parking within designated parking areas at Cator and Putnam Fields. f. Upon request of the City, Nor Cal Oaks shall schedule youth baseball activities to meet the scheduling needs of the City’s Recreation Department, to be provided to Nor Cal Oaks by the City no later than January 1 and July 1 (or the next following City working day) each calendar year.
g. Herbicides or pesticides must be approved for use by the City prior to use on the Facilities.
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3 h. The fields must remain unlocked and available to the public outside of reserved times pursuant to this License for use of the fields for baseball or softball and related maintenance activities. Unless written express permission is provided by the City Manager, the fields may only be locked during or immediately following rain events that would make the turf susceptible to damage if played on. If NorCal Oaks uses the fields for baseball or softball activities, the field must also be open to the public outside of reserved times. The batting cages at Putnam may be locked to prevent vandalism, but must be available to the public for batting use with reasonable advanced notice.
I. Nor Cal Oaks shall post and maintain current signage adjacent to all entries/exists to each licensed field and batting cages with contact information for Nor Cal Oaks for the public to contact with questions, batting cage reservations, or if the fields need attention.
5. Notification.
a. Nor Cal Oaks shall keep the City informed of all special events which have potential traffic impacts and scheduling changes pertaining to the use of the Facilities that may impact City operations.
b. Each year, by January 15 (or the next following City working day) Nor Cal Oaks shall provide the City with an updated contact list, including Board Member titles, phone numbers, and email addresses. c. Nor Cal Oaks shall send the City a calendar of all scheduled Nor Cal Oaks events at the Facilities on January 15 and July 15 (or the next following City working day) of each calendar year and any changes will be promptly communicated to the City Recreation Manager.
e. Nor Cal Oaks shall promptly notify the City of any maintenance or repair issues of the Facilities.
f. Nor Cal Oaks shall notify the City of all hazards and injuries occurring at the Facilities, as well as any action taken by Nor Cal Oaks with respect thereto, as promptly as possible, but in no event later than within fortyeight (48) hours of the occurrence or discovery of the hazard.
6. Maintenance and Operation.
a. Nor Cal Oaks shall be responsible for performing a high level of the maintenance and operation of the Facilities, all year, including without limitation:
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4 i. Infields and outfields, which includes weeding, mowing, fertilizing, watering, pest control, filling gopher holes and reseeding the turf as needed;
ii. Infield dirt base paths and warning track;
iii. The repair and maintenance of all baseball related infrastructure, including, but not limited to, the irrigation system inside the lLicensed fields, including the control valve manifold from the first elbow or tee on the park side of the manifold, the snack shack(s), scoreboards; backstop, dugouts, fencing and bleachers, including painting and graffiti coverup as needed;
iv. Removal of hazards, including taking immediate action to secure, repair or close off any hazard or safety concern to persons using the Facilities;
v. Cleaning and maintaining the restrooms and water fountains in a sanitary condition, including keeping them stocked with toilet paper, paper towels and soap as applicable;
vi. Litter, garbage, and debris removal, including the provision for trash and recycling dumpsters and their removal; and
vii. Provision for portable toilets as necessary.
viii. In the event an irrigation leak or malfunction is identified, youNor Cal Oaks must immediately notify the City to properly turn off the meterservice, if needed, for proper repairs and potential billing adjustments. b. The City shall be responsible for the following:
i. i. Maintenance of all water lines and irrigation
systems in the parks, but not including the control valve manifold for the licensed fields. The control valve
manifold starts at the first elbow or tee on the park side of the control valve manifold;;
ii. Maintenance of all irrigation controllers, including the control wires to the irrigation control valves;
i.iii. Payment of water charges to irrigate the fields, provided that the actual consumption in a single billing period does not exceed by more than 10% the 3-month moving average
of the consumption, centered on the same time period
during the prior year. The 3-month moving average
calculation will use the month prior, the same month and the following month from the prior year, excluding major aberrations as determined by the City. ;
ii. Maintenance of the paved parking areas as needed;
iii. Water fountain repair and;
iv. Maintenance of the turf areas outside of the infield and outfield areasfenced baseball/softball fields.
7. Alterations & Replacements. Nor Cal Oaks shall not make or permit any alteration, modification, or replacement (collectively “alterations”) of the Facilities without prior written 371 of 387
5 City approval. If requested by the City, the details of planned Facility alterations shall be provided to the City Recreation Manager, including images of the alterations prior to initiating work for City review and advisement on consistency with park master plans and any permitting requirements. Depending on the scope of the requested alterations, plans, specifications and permits may be required by the City. In addition, be advised that some alternations may also require issuance of a building permit (roof, plumbing, electrical, etc.). Nor Cal Oaks shall be responsible for all costs thereof.
8. Utilities. Effective at the start of the first full billing period in January 2026, the City will revert responsibility for the irrigation only accounts at Putnam and Cator back to the City. The City shall transfer the accounts to Nor Cal Oaks within thirty (30) days of the Effective Date of this Agreement andshall retain and continue to pay for all electric, water, and sewer expenses related to the operation of the Snack Shack and restroom facilities located at Cator Field and Putnam Fields. In the event of a drought or other water restriction, Nor Cal Oaks shall comply with any watering restrictions with the understanding that watering will be permitted to allow for proper maintenance and to the extent needed to preserve the investment Nor Cal Oaks makes in rehabilitating the Cator and Putnam Fields.
9. Possessory Interest. In accordance with California Revenue and Taxation Code Section 107.6, the City is hereby notifying Nor Cal Oaks that this Agreement may create a property or possessory interest and such interest may be subject to property taxation if created, and Nor Cal Oaks may be subject to the payment of property taxes levied on the interest. Nor Cal Oaks expressly recognizes and understands that this Agreement may create a property or possessory interest subject to property taxation and that Nor Cal Oaks may be subject to the payment of property taxes levied on such interest.
10. Compliance with Laws. Nor Cal Oaks represents and warrants to City that Nor Cal Oaks and its officers, agents, employees and volunteers have all licenses, permits, qualifications and approvals of whatever nature that are legally required for Nor Cal Oaks, its officers, agents, employees and volunteers to provide the services, programs and activities contemplated by this Agreement and that it shall observe and comply at all times with all applicable federal, state, county and city statutes and ordinances, rules, regulations, directives, and orders of governmental agencies now in force or which may hereinafter be in force relating to or affecting the use of the License herein granted. Additionally, Nor Cal Oaks and its officers, agents, employees and volunteers shall provide an environment that is free from harassment and discrimination of any kind based on any legally protected status including but not limited to sex, gender, gender identity, race, color, religion, national origin, citizenship, ancestry, age, physical disability, mental disability, protected medical condition, marital status, sexual orientation, or any other characteristic prohibited by state or federal law.
11. Waste Nuisance. Nor Cal Oaks shall not commit, suffer, or permit the commission by others of:
a. Any waste or nuisance at the Facilities;
b. Any action or use of the Facilities which interferes or conflicts with the use thereof by the City or any authorized person; or
c. Any action at the Facilities in violation of any laws or ordinances. 372 of 387
6 12. Inspection. The City shall be permitted to enter and inspect the Facilities at any and all times.
13. Extent of Grant of License. This Agreement and the License herein granted are valid only to the extent of the City’s jurisdiction as a landowner or tenant of the Facilities. Acquisition of any other necessary permits or entitlements for use is the responsibility of Nor Cal Oaks.
NOTHING CONTAINED IN THIS AGREEMENT SHALL BE CONSTRUED AS A RELINQUISHMENT OF ANY RIGHTS NOW HELD BY THE CITY.
14. Release of Claims. Nor Cal Oaks hereby waives, releases, and discharges the City, its officers, officials, agents, employees and volunteers (collectively, “Indemnitees”) from all present and future Claims (defined in Section 23 herein) arising out of or in any way connected with entry upon or use of the Facilities by Nor Cal Oaks or its agents, employees, invitees, contractors or subcontractors, including without limitation all Claims arising in connection with any injury to persons or damage to or theft of vehicles, equipment, materials or any other personal property, except and to the extent caused solely by the gross negligence or willful misconduct of the Indemnitees. The provisions of this Section 14 shall survive the expiration or earlier termination of this Agreement.
15. License is Personal. The License herein granted is personal to Nor Cal Oaks and no right hereunder may be assigned, sublet, or otherwise transferred in whole or in part without the prior written consent of the City. Any attempt to assign, sublet or transfer same shall be of no force or affect whatsoever unless and until the City shall have given its written consent thereto.
The City may withhold its consent for any reason.
16. Termination. Each provision of this Agreement shall be deemed a condition of the right of Nor Cal Oaks to use or continue to occupy the Facilities. Notwithstanding anything stated to the contrary herein, if either party fails to perform any provision of this Agreement at the time and in the manner herein provided, including without limitation maintenance of required insurance, failure to make the improvements in Exhibit “B”, an act of God that makes the Facilities unsafe for the public and requires immediate City remediation, or City’s determination in its sole discretion that Nor Cal Oaks is operating in a manner that presents a health, safety or welfare threat to the participants, members of the public or the community, the Parties may immediately terminate this Agreement for cause. If the City or Licensee provides written notice of a default of the terms of this Agreement, delivered in accordance with Section 21, either Party has thirty (30) days to cure the default. If the default cannot by its nature be cured within such thirty (30) day period, then the City or Licensee will have an additional thirty (30) days to cure the default. A termination for cause pursuant to this provision shall not prejudice or waive any rights or remedies in law which one Party may have against the other. At any time during the term of this Agreement, the Parties may mutually agree in writing to amend or terminate the Agreement. Upon termination, Nor Cal Oaks shall promptly remove at its own expense all of its equipment, inventory and fixtures from the Facilities and shall restore the Facilities to their original condition, ordinary wear and tear excepted, unless the City and Nor Cal Oaks agree in writing that such fixture shall remain a part of the Facilities. Upon Nor Cal Oaks’ failure to remove same within thirty (30) days of the stated termination date, it shall lose all right, title and interest thereto and City may elect to keep, remove or demolish same. City’s right of termination shall be cumulative to any other legal or equitable remedies available to City. 373 of 387
7 17. Nor Cal Oaks to Act in Independent Capacity. Nor Cal Oaks and its officers, agents, and employees shall act in an independent capacity and shall not represent themselves to be or be construed to be officers, agents, or employees of the City.
18. License Not a Lease. This Agreement does not constitute a lease but constitutes a mere license and Nor Cal Oaks is limited to the use of the Facilities expressly and specifically described above. Nor Cal Oaks shall have no right or privilege in any respect whatsoever to use any other part of the property of the City for any purpose whatsoever. Nor Cal Oaks hereby disclaims any interest that when coupled with the License herein granted would render it irrevocable.
19. No Continuing Waiver. The waiver by the City of any breach of any of the provisions of this Agreement shall not constitute a continuing waiver of any subsequent breach of the same, or of any other provision of this Agreement.
20. Relationship. The Parties intend by this Agreement to establish the relationship of licensor and licensee only, and do not intend to create a partnership, joint venture, joint enterprise, or any business relationship other than that of licensor and licensee.
21. Contacts; Notices. The Parties desire to keep open lines of communication throughout the calendar year. To that end, the primary contacts for each Party are as follows:
City Nor Cal Oaks
For Field Maintenance
Issues:
Public Works Superintendent
201 West Sierra Avenue
Cotati, CA 94931
Business Hours 707-975-
7356
After Hours 707-792-4611
Jon TitusJason Chickering
Board of Directors -
PresidentMember
901 A St, Suite C
San Rafael, CA 94901
707-480-1708
1875 Waltzer Rd.
Santa Rosa, CA 95403
(707) 470-6316
Event Notices and All Other
Issues:
Recreation Manager
201 West Sierra Avenue
Cotati, CA 94931
Business Hours 707-792-
4600
After Hours 707-792-
4611665-4222
Hilaire SanderAlyssa Noone
Board of Directors –
TreasurerSecretary
901 A St, Suite C
San Rafael, CA 94901
206-650-1841
1875 Waltzer Rd.
Santa Rosa, CA 95403
(707) 484-1352
All notices given under this Agreement shall be in writing and shall be deemed to have been given if delivered personally or enclosed in a properly addressed envelope and deposited in a 374 of 387
8 United States post office for delivery by registered or certified mail, postage paid to the Parties at the aforementioned addresses.
22. Hold Harmless and Indemnification. To the maximum extent permitted by law, Nor Cal Oaks shall indemnify, defend and hold harmless the Indemnitees from and against any and all liability, claims, damages, demands, costs, losses and expenses, including without limitation court costs and attorneys’ fees (collectively, “Claims”) arising out of or in connection with Nor Cal Oaks’ entry upon or use of the Facilities or its negligent or willful failure to comply with any of its obligations contained in this Agreement, except to the extent caused by the negligence or willful misconduct of Indemnitees. The obligation to indemnify, hold harmless and defend City shall survive the expiration or earlier termination of this Agreement.
23. Insurance. Nor Cal Oaks agrees to obtain and keep in force during the life of this Agreement at Nor Cal Oaks’ expense, public liability and property damage insurance in a form, and with an insurer, acceptable and subject to the approval of the City, said insurance to protect against any liability to the public as a result of the use of or resulting from any accident occurring in or about Cator Field, or other Facilities. Nor Cal Oaks agrees to maintain comprehensive insurance of Five Million Dollars ($5,000,000) minimum per occurrence for bodily injury, personal injury, and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to the Facilities or the general aggregate limit shall be twice the required occurrence limit, insuring against all liability of Nor Cal Oaks and its authorized representatives arising out of and in connection with Nor Cal Oaks use of the Facilities. Said insurance shall be provided on forms approved by the City of Cotati.
24. Entire Agreement; Amendments. This Agreement constitutes the entire agreement of the Parties with respect to the subject matter hereof and supersedes all prior written or oral agreements, understandings, representations, or statements with respect thereto. This Agreement may be amended only by a written instrument executed by the Parties.
25. Severability. If any term, provision, or condition of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of the Agreement shall continue in full force and effect to the extent possible.
26. Governing Law; Venue. This Agreement and the rights and obligations thereunder shall be governed by and interpreted in accordance with the laws of the State of California. The venue for any action brought hereunder shall be a court of competent jurisdiction in Sonoma County.
27. No Third-Party Beneficiaries. Nothing in this Agreement is intended to or shall confer upon any person other than the Parties any rights or remedies hereunder.
28. Authority. Each person executing this Agreement warrants that s/he has been duly authorized to execute the Agreement on behalf of the entity s/he represents and that this is a legally binding Agreement enforceable against the entity s/he represents in accordance with its terms.
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9 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.
LICENSOR: LICENSEE:
CITY OF COTATI NOR CAL OAKS
By:____________________________ By:_____________________________ Damien O’Bid [Jason Chickering, President
City Manager
APPROVED AS TO FORM: ATTEST:
________________________
John Bakker Kevin Patterson
City Attorney City Clerk
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9 377 of 387
10 EXHIBIT A
FACILITIES
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10 379 of 387
11 EXHIBIT B
COMMITTED INVESTMENT SUMMARY
Cost estimates for repairing Cator and Putnam fields:
Dirt, Rock Soil: $8,437.50
Trucking: $3,150.
Equipment: $50,000.
Sod: $132,000.
Sand: $20,000.
Irrigation: $70,000.
Fencing: $75,000.
Supplies: $25,000.
Stands: $20,000.
Snack Bar/Bathrooms: $10,000.
Dugouts: $10,000.
Gofer Wire: $54,000.
Putnam Backstop Netting: $75,000.
Labor: $25,000.
TOTAL: $577,587.50
5350733.1
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1/8/2026 5:24:34 PM Page 1 of 3
Budget Adjustment Register
Cotati, CA Adjustment Detail
Packet: GLPKT13939 - Putnam and Cator Field - Irrigation Adjustment Number Budget Code Description Adjustment Date BA0000074 Adopted Budget for FY 2025… Putnam Field - Irrigation for 2025/26 1/13/2026 Summary Description: Estimated increased expenditures for irrigation water costs at Putnam Park for FY 2025/26.
Account Number Account Name Adjustment Description Before Adjustment After 101-22-80304-000000 UTILITIES - WATER Putnam Field - Irrigation for 2025/26 106,090.00 4,000.00 110,090.00 January: 4,000.00
Adjustment Number Budget Code Description Adjustment Date BA0000075 Adopted Budget for FY 2026… Putnam Park Irrigation for FY 2026/27 7/1/2026 Summary Description: Estimated increased expenditures for irrigation water costs at Putnam Park for FY 2026/27.
Account Number Account Name Adjustment Description Before Adjustment After 101-22-80304-000000 UTILITIES - WATER Putnam ParkIrrigation for FY 2026/27 116,700.00 10,100.00 126,800.00 July: 841.67
August: 841.67
September: 841.67
October: 841.67
November: 841.67
December: 841.67
January: 841.67
February: 841.67
March: 841.67
April: 841.67
May: 841.67
June: 841.63
Adjustment Number Budget Code Description Adjustment Date BA0000076 Adopted Budget for FY 2025… Cator Field Irrigation Budget Adjustment FY 25/26 1/13/2026 Summary Description: Estimated increased expenditures for irrigation water costs at Cator Field for FY 2025/26.
Account Number Account Name Adjustment Description Before Adjustment After 101-22-80304-000000 UTILITIES - WATER Cator Field Irrigation Budget Adjustment FY 25… 106,090.00 1,800.00 107,890.00 January: 1,800.00
Adjustment Number Budget Code Description Adjustment Date BA0000077 Adopted Budget for FY 2026… Cator Field Irrigation Budget Adjustment FY 26/27 7/1/2026 Summary Description: Estimated increased expenditures for irrigation water costs at Cator Field for FY 2026/27.
Account Number Account Name Adjustment Description Before Adjustment After 101-22-80304-000000 UTILITIES - WATER Cator Field Irrigation Budget Adjustment FY 26… 116,700.00 4,500.00 121,200.00 July: 375.00
August: 375.00
September: 375.00
October: 375.00
November: 375.00
December: 375.00
January: 375.00
February: 375.00
March: 375.00
April: 375.00
May: 375.00
June: 375.00
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Budget Adjustment Register Packet: GLPKT13939 - Putnam and Cator Field - Irrigation 1/8/2026 5:24:34 PM Page 2 of 3
Budget Budget Description Account Account Description After Budget Code Summary
Before Adjustment
2025-2026 Adopted Budget for FY 20… 101-22-80304-000000 UTILITIES - WATER 106,090.00 5,800.00 111,890.00 2025-2026 Total: 106,090.00 5,800.00 111,890.00
2026-2027 Adopted Budget for FY 20… 101-22-80304-000000 UTILITIES - WATER 116,700.00 14,600.00 131,300.00 2026-2027 Total: 116,700.00 14,600.00 131,300.00
Grand Total: 222,790.00 20,400.00 243,190.00
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Budget Adjustment Register Packet: GLPKT13939 - Putnam and Cator Field - Irrigation 1/8/2026 5:24:34 PM Page 3 of 3
Fund After
Fund Summary
Before Adjustment
Budget Code:2025-2026 - Adopted Budget for FY 2025/26 Fiscal: 2025-2026 101 106,090.00 5,800.00 111,890.00
Budget Code 2025-2026 Total: 106,090.00 5,800.00 111,890.00 Budget Code:2026-2027 - Adopted Budget for FY 2026/27 Fiscal: 2026-2027 101 116,700.00 14,600.00 131,300.00
Budget Code 2026-2027 Total: 116,700.00 14,600.00 131,300.00 Grand Total: 222,790.00 20,400.00 243,190.00
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Cotati City Council
Agenda Staff Report
Item type: REGULAR AGENDA (ACTION)
To: City Council
Subject: DISCUSSION ON AUTHORIZATION FOR THE MAYOR TO
ADVOCATE FOR INFRASTRTURE FUNDING WITH
ABAG/MTC
Date: January 13, 2026
Written by: Damien O'Bid, City Manager
Recommendation
It is recommended that the City Council by motion authorize the Mayor to advocate for ABAG/MTC to maintain their commitment to preferential transportation infrastructure funding for jurisdictions that have made meaningful progress towards compliance with Transit Oriented Community policy.
Background
The Metropolitan Transportation Commission (MTC)/Association of Bay Area Governments (ABAG) is the agency responsible for receiving and allocating transportation and transportation infrastructure funding from Federal and State sources to local jurisdictions in the San Francisco Bay Area, including Sonoma County. MTC/ABAG is also responsible for implementing a variety of housing and transportation policies adopted by the State, such as the Transit Oriented Community (TOC) policy.
Analysis/Discussion
In the effort to continue to drive the convergence of housing and transportation policy and infrastructure, for several cycles now ABAG/MTC has linked transportation funding to housing policy. More recently, ABAG/MTC has developed the TOC requirements and has been telegraphing to Bay Area jurisdictions that future cycles of transportation funding will be linked to their compliance with TOC policies. However, many jurisdictions have not yet started any meaningful efforts to move towards compliance.
In Cotati, as well as other jurisdictions in Sonoma County, there has been meaningful progress 384 of 387
made towards meeting the TOC requirements. While ABAG/MTC has been continuing to state that future transportation funding will be linked to TOC policy compliance, there has increasingly been hedging on this requirement by the ABAG/MTC commission as we get closer to the need to actually commit to this requirement. Presumably, this is due to the lack of progress towards TOC compliance in many jurisdictions and the pending transportation funding cycle.
Therefore, staff recommend that the Mayor be authorized to advocate for preferential transportation funding for jurisdictions that have made meaningful progress towards TOC compliance and hold ABAG/MTC to their commitment. This includes sending letters and/or directly advocating with our Sonoma County ABAG/MTC Commissioner (Victoria Flemming, Santa Rosa City Council), ABAG/MTC, or other state and regional representatives on behalf of the City.
Financial Considerations
There are no direct financial impacts by authorizing the recommended advocacy. However, if successful, it could result in an increase in transportation infrastructure funding for Cotati and other jurisdictions in the Bay Area that have made meaningful progress towards TOC compliance.
Environmental Issues
Where it can be determined with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA review.
This general rule can be applied to activities which could be subject to the CEQA process, but which logic dictates should not be subject to CEQA review. Therefore, based on the information provided above, the proposed resolution is exempt from CEQA pursuant to Section 14.03.021 of the CEQA Guidelines in that there is no possibility that the activity may have a significant impact on the environment.
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DRAFT
ABAG/MTC COMMISSIONERS,
I’m reaching out to you on behalf of the City Council of the City of Cotati to highlight the importance of Transit Oriented Communities (TOC) policy consistency in the determination of One Bay Area Grant (OBAG) funding. As you know, Sonoma County jurisdictions have prioritized compliance with TOC policies and development and are diligently working to ensure consistency with the direction from AGAB/MTC OBAG funding determination deadline.
It has come to our attention that the intent to tie OBAG funding to TOC compliance may be waning as ABAG/MTC decision makers move to finalize their consistency determinations and OBAG funding decisions. As a jurisdiction that has spent considerable efforts to achieve TOC compliance, and one which relies significantly on OBAG funds to make improvements to our local infrastructure, this potential move away from TOC consistency in the OBAG funding determination is concerning.
It is understood that some jurisdictions may not have adequate resources to achieve full or even partial compliance and completely removing their eligibility for OBAG funds due to limited resources could be seen as overly penalizing. However, rewarding jurisdictions who have allocated their scarce resources toward meeting the TOC policy priorities as directed by ABAG/MTC over the past year is similarly important.
Given this, the City of Cotati is requesting ABGB/MTC Commission include a set-aside of OBAG funds or some form of weighting in the funding allocation as an incentive to motivate jurisdictions continued efforts to achieve TOC policy compliance. This compromise would allow jurisdictions which were unable to achieve compliance to remain eligible for funding, but also keep the OBAG funding determination consistent with the policy direction provided since the announcement of the TOC policy creation by ABAG/MTC. Separate from remaining consistent with provided direction, these set funds would allow communities with a dedicated commitment to achieving TOC consistency, additional funds to improve transit access and reduce the dependence on automobile transportation.
Thank you for your consideration of this very important matter.
Sincerely,
Sylvia Lemus
Mayor
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Cotati City Council
Agenda Staff Report
Item type: INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED To: City Council
Subject: INFORMATION RECEIVED AFTER THE AGENDA WAS POSTED Date: January 13, 2026
Written by: Kevin Patterson, City Clerk
Recommendation
Information or written comments pertaining to this meeting, and which was received after the agenda was posted, is attached below.
Pursuant to City Council Policy 2025-03: City Council Rules section IV A., written Communications, interested persons or their authorized representative may address the Council by written communication on any matters concerning the City’s business, or any matters over which the Council has control.
1. To be considered for inclusion in the agenda packet, such written communication shall be delivered to the City Clerk no later than 11:00 a.m. of the Wednesday the week preceding the regular Council meeting for which such written communication is intended.
2. If received after the above date and time, but no later than noon the day before the meeting, written communications received by the City Clerk shall be posted on the website by the end of that day and notification provided to the electronic Agenda mailing list by the end of the day. All written communications received by the City Clerk by 5 pm on the City Council meeting day shall be made available to the City Council and public at the City Council meeting.
City Council Policy 2025-03 is available at the online meeting portal at www.cotaticity.gov or by request from the City Clerk at 707-665-3622 or [email protected]. 387 of 387