Table 1-1
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Summar
y
Option A Option B Option A Option B Option A Option B
Item Townhomes
Bungalow
Court 3-story MU 3-story MU
5-story
MU/Grocery Horizontal MU
Site Acres 0.2 0.4 0.2 0.2 2.2 2.2
Existing Structure Sq. Ft. 4,800 4,800 0 0 39,000 39,000 Land Use Type 1 (Residential)
Land Use Townhomes Bungalow 3-story MU 3-story MU 5-story Horizontal MU Tenure For-Sale For-Sale Rental Rental Rental Rental
No. of Units 5 10 12 18 164 50
No. of Parking Spaces 10 10 15 15 237 91
Type of Parking
2-Car
Garage Surface Surface
At-Grade
Structure
At-Grade
Structure Surface
Land Use Type 2 (Commercial)
Land Use - - Commercial Commercial Commercial Commercial No. of Units/Net Bldg. Sq. Ft. - - 2,294 2,114 14,358 5,183 No. of Parking Spaces - - 4 4 24 9
Type of Parking - - Surface At-Grade At-Grade Surface REVENUE [2]
Land Use Type 1 $1,911,970 100.0% $2,824,844 100.0% $1,623,109 76.6% $2,358,082 83.8% $36,001,552 91.1% $10,125,818 90.0% Land Use Type 2 - - - - $495,504 23.4% $456,624 16.2% $3,514,838 8.9% $1,119,528 10.0% TOTAL ESTIMATED REVENUE $1,911,970 100.0% $2,824,844 100.0% $2,118,613 100.0% $2,814,706 100.0% $39,516,391 100.0% $11,245,346 100.0% COSTS [2] [3]
Land Use Type 1 $1,757,339 100.0% $2,400,520 100.0% $2,910,927 74.9% $5,234,163 84.2% $63,782,179 90.1% $17,115,088 86.6% Land Use Type 2 - - - - $972,959 25.1% $979,809 15.8% $7,031,036 9.9% $2,639,184 13.4% TOTAL ESTIMATED COSTS $1,757,339 100.0% $2,400,520 100.0% $3,883,886 100.0% $6,213,972 100.0% $70,813,215 100.0% $19,754,272 100.0%
RESIDUAL LAND VALU
E $154,631 - $424,324 - ($1,765,273) - ($3,399,266) - ($31,296,824) - ($8,508,926) - Per Acre $808,124 - $1,035,086 - ($7,689,528) - ($14,807,202) - ($14,545,014) - ($3,954,473) - Per Sq. Ft. of Land $18.55 - $23.76 - ($176.53) - ($339.93) - ($333.91) - ($90.78) - As a % of Revenue 8.1% - 15.0% - (83.3%) - (120.8%) - (79.2%) - (75.7%) - FEASIBILITY FINDING [4] - - - - - -
Source: WRT; Citythinkers; EPS.
[1] See Table B-1.
[2] See Table A-1, Table A-2, Table A-3, Table A-4, and Table A-5. [3] Includes site demolition costs if applicable.
[4] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
Feasibility Summary
Site 3:
1349 N Blackstone Ave
% of
Total
% of
Total
Site 1:
732 N Van Ness Ave
Site 2:
1145 N Van Ness Ave
DEV. PROGRAM ASSUMPTIONS
% of
Total% of Total
% of
Total
% of
Total
Prepared by EPS 2/23/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx 20 DRAFT
Table 1-1
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Summar
y
Option A Option B Option A Option B
Item 5-story MU
Horizontal
MU/TH
Whole Site
Redev / 5-story
Partial Phased /
5-story
Site Acres 1.1 1.1 2.9 2.9
Structure(s) Sq. Ft. 10,000 10,000 25,500 25,500
Land Use Type 1 (Residential)
Land Use 5-story MU Horizontal Whole Site Partial Phased / Tenure Rental For-Sale Rental Rental
No. of Units 111 15 268 113
No. of Parking Spaces 123 52 280 147
Type of Parking
At-Grade
Structure 2-Car Garages
Half
Submerged
At-Grade
Structure
Land Use Type 2 (Commercial)
Land Use Commercial Commercial Commercial Commercial
No. of Units/Net Bldg. Sq. Ft. 8,500 8,600 3,900 29,500 No. of Parking Spaces 14 14 7 49
Type of Parking At-Grade Surface Half At-Grade
REVENUE [2]
Land Use Type 1 $28,292,727 93.1% $5,840,600 73.5% $65,477,455 98.7% $26,945,455 78.9% Land Use Type 2 $2,080,800 6.9% $2,105,280 26.5% $842,400 1.3% $7,221,600 21.1% TOTAL ESTIMATED REVENUE $30,373,527 100.0% $7,945,880 100.0% $66,319,855 100.0% $34,167,055 100.0% COSTS [2] [3]
Land Use Type 1 $45,804,510 93.0% $5,192,322 57.2% $105,107,848 97.7% $42,421,525 78.9% Land Use Type 2 $3,472,439 7.0% $3,879,606 42.8% $2,514,255 2.3% $11,320,821 21.1% TOTAL ESTIMATED COSTS $49,276,949 100.0% $9,071,928 100.0% $107,622,103 100.0% $53,742,346 100.0%
RESIDUAL LAND VALU
E ($18,903,422) - ($1,126,048) - ($41,302,248) - ($19,575,292) - Per Acre ($17,080,839) - ($1,017,479) - ($14,441,415) - ($6,844,541) - Per Sq. Ft. of Land ($392.12) - ($23.36) - ($331.53) - ($157.13) - As a % of Revenue (62.2%) - (14.2%) - (62.3%) - (57.3%) - FEASIBILITY FINDING [4] - - - -
Source: WRT; Citythinkers; EPS.
[1] See Table B-1.
[2] See Table A-1, Table A-2, Table A-3, Table A-4, and Table A-5. [3] Includes site demolition costs if applicable.
[4] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
Feasibility Summary
Site 4:
706, 720, & 740 E Belmont Ave
Site 5:
740 & 820 E Shields Ave;
3111 Maroa
% of
Total
% of
Total
% of
Total
% of
Total
DEV. PROGRAM ASSUMPTIONS [1]
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Economic & Planning Systems, Inc. (EPS) 22
The findings below examine each land use type individually to determine which uses have the potential for feasibility. A test of potential feasibility is calculating the RLV as a percentage of the estimated value. Static RLV percentage benchmarks reflect the following indicators:
• Feasible = 10% or higher
• Potential for feasibility = 0.01% to 9.9%
• Infeasible = > 0.0%
For-Sale Residential Units
The townhome prototypes appear to have the potential for feasibility. • In this analysis the townhome prototypes yield a positive RLV percentage indicating the potential for feasibility. At a density of 26 units per acre the townhomes RLV percentage is approximately 8 percent, slightly below the 10 percent threshold for likely feasibility, however when the density is increased to 111 units per acre as a single land use type, the RLV percentage moves up to 11 percent reflecting likely feasibility. At the lower density the sales price would need to increase by only 2 percent to be considered likely feasible.
The bungalow court prototypes appear to be likely feasible. • In this analysis both townhomes and bungalow court prototypes yield a positive RLV percentage indicating the potential for feasibility. The bungalow courts yield a 15 percent RLV percentage reflecting likely feasibility. The townhomes at a density of 26 units per acre reflect a RLV percentage of 8 percent, slightly below the 10 percent likely feasible threshold, however when the density is increased to 111 units per acre the RLV percentage moves up to 11 percent reflecting likely feasibility. This land use also moves into the likely feasible range when the City building fees are waived. 3-Story Walk-Up Rental Apartments
The 3-story walk-up rental apartments would require financial intervention to achieve an RLV percentage within the range that reflects the potential for feasibility (10 percent or higher).
• The 3-story walk-up apartments would require an 88 percent to 100 percent increase in revenue (from $1.32 to $1.49 per leasable square foot) to achieve a positive RLV within the threshold of 10 percent reflecting feasibility.
Alternatively, this prototype would require an $1.6 million to $8.9 million public subsidy or total cost reduction.
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3- and 5-Story Podium Rental Apartments
The relationship between development costs and potential revenues for 3- and 5-story podium apartments is such that financial interventions will likely be necessary to encourage the development of these land uses. • The 3- and 5-story podium apartments would both need subsidies equating to a 75 percent to 147 percent increase in revenue (from $1.43 to $2.20 per leasable square foot) to achieve a positive RLV within the threshold of 10 percent reflecting feasibility. Alternatively, this prototype would require a $3.5 million to $51.4 million public subsidy or total cost reduction. The prototypes with higher density of units per acre require less of an increase in rent to obtain a RLV percentage high enough to reflect feasibility indicating if these project types could achieve higher rents or obtain subsidies for the construction costs there could be the potential for feasibility.
Retail
Retail as sole land use appears to be financially infeasible in the current market.
• Retail space would need to obtain rents that are approximately 80 percent to 388 percent higher than current rates (from $1.38 to $5.83 per leasable square foot) to achieve a positive RLV of 10 percent due to the high costs of building construction and low market rate rents. Alternatively, this prototype would require a $621,600 to $5.8 million public subsidy or total cost reduction. The retail prototypes with more square footage require less of an increase in rent to obtain a RLV percentage high enough to reflect feasibility because retail spaces larger than 10,000 square feet obtain slightly higher rents per square foot as shown in Table B-6.
Sensitivity Analysis
To examine potential financial levers and how they affect the feasibility of each opportunity site and land use, EPS ran sensitivity analyses removing certain costs from each scenario. The sensitivity analyses included: decreasing the parking requirement by 50 percent; removing all parking; and waiving estimated City development and building fees. In the current market, all three cost reduction measures alone and even combined do not represent a large enough portion of the total costs to create a positive RLV for any of the financially infeasible opportunity sites, with the exception of one land use. Waiving City development and building fees moves the Townhomes from marginally feasible to likely financially feasible. Table 1-2 provides a summary of the sensitivity analysis use results for each Opportunity Site.
DRAFT
Table 1-2
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis: Sensitivity Analyse
s
Option A Option B Option A Option B Option A Option B
Item Townhomes Bungalow Court 3-story MU 3-story MU 5-story MU/Grocery Horizontal MU Site Acres 0.2 0.4 0.2 0.2 2.2 2.2
Revenue
Land Use Type 1 $1,911,970 100.0% $2,824,844 100.0% $1,623,109 76.6% $2,986,904 86.7% $36,001,552 91.1% $10,125,818 90.0% Land Use Type 2 - - - - $495,504 23.4% $456,624 13.3% $3,514,838 8.9% $1,119,528 10.0% Total Estimated Revenue $1,911,970 100.0% $2,824,844 100.0% $2,118,613 100.0% $3,443,528 100.0% $39,516,391 100.0% $11,245,346 100.0% Costs
Land Use Type 1 $1,757,339 100.0% $2,351,467 100.0% $2,572,552 73.1% $4,676,838 83.9% $58,111,164 89.6% $16,260,656 86.2% Land Use Type 2 - - - - $945,474 26.9% $898,182 16.1% $6,711,883 10.4% $2,603,216 13.8% Total Estimated Costs $1,757,339 100.0% $2,351,467 100.0% $3,518,026 100.0% $5,575,020 100.0% $64,823,047 100.0% $18,863,871 100.0% Residual Land Value $154,631 - $473,377 - ($1,399,413) - ($2,131,492) - ($25,306,656) - ($7,618,525) - Per Sq. Ft. of Land $18.55 - $26.51 - ($139.94) - ($213.15) - ($270.00) - ($81.28) - As a % of Revenue 8.1% - 16.8% - (66.1%) - (61.9%) - (64.0%) - (67.7%) - Feasibility Finding [2]
Revenue
Land Use Type 1 $1,911,970 100.0% $2,824,844 100.0% $1,623,109 76.6% $2,986,904 86.7% $36,001,552 91.1% $10,125,818 90.0% Land Use Type 2 - - - - $495,504 23.4% $456,624 13.3% $3,514,838 8.9% $1,119,528 10.0% Total Estimated Revenue $1,911,970 100.0% $2,824,844 100.0% $2,118,613 100.0% $3,443,528 100.0% $39,516,391 100.0% $11,245,346 100.0% Costs
Land Use Type 1 $1,475,162 100.0% $2,352,970 100.0% $2,282,210 65.1% $9,264,527 89.9% $69,951,029 95.8% $16,729,000 86.3% Land Use Type 2 - - - - $1,222,794 34.9% $1,042,109 10.1% $3,045,431 4.2% $2,662,832 13.7% Total Estimated Costs $1,475,162 100.0% $2,352,970 100.0% $3,505,004 100.0% $10,306,637 100.0% $72,996,459 100.0% $19,391,832 100.0% Residual Land Value $436,808 - $471,874 - ($1,386,391) - ($6,863,109) - ($33,480,069) - ($8,146,486) - Per Acre $2,282,828 - $1,151,079 - ($6,039,119) - ($29,895,703) - ($15,559,664) - ($3,786,031) - Per Sq. Ft. of Land $52.41 - $26.43 - ($138.64) - ($686.31) - ($357.20) - ($86.92) - As a % of Revenue 22.8% - 16.7% - (65.4%) - (199.3%) - (84.7%) - (72.4%) - FEASIBILITY FINDING [3]
Source: WRT; Citythinkers; EPS.
[1] This sensitivity analysis reduces the amount of parking spaces to 50% of the initial development program assumptions. [2] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
[3] This sensitivity analysis excludes approximately 75% of estimated development and building fees that would be collected, reflecting those collected by the City only; assumes fees imposed by the County and other applicable agencies would not be waived.
Site 3:
1349 N Blackstone Ave
Site 2:
1145 N Van Ness Ave
Sensitivity Scenarios
SENSITIVITY #2: WAIVED BUILDING FEES [3]
SENSITIVITY #1: REDUCED PKG REQ. [1]
% of
Total
% of
Total
% of
Total
% of
Total
% of
Total
% of
Total
Site 1:
732 N Van Ness Ave
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Table 1-2
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis: Sensitivity Analyse
s
Option A Option B Option A Option B
Item 5-story MU Horizontal MU/TH
Whole Site Redev / 5-
story
Partial Phased / 5-
story
Site Acres 1.1 1.1 2.9 2.9
Revenue
Land Use Type 1 $28,292,727 93.1% $5,840,600 73.5% $65,477,455 98.7% $26,945,455 78.9% Land Use Type 2 $2,080,800 6.9% $2,105,280 26.5% $842,400 1.3% $7,221,600 21.1% Total Estimated Revenue $30,373,527 100.0% $7,945,880 100.0% $66,319,855 100.0% $34,167,055 100.0% Costs
Land Use Type 1 $43,102,327 92.0% $4,169,174 52.2% $103,760,412 97.7% $39,690,144 77.9% Land Use Type 2 $3,769,627 8.0% $3,812,699 47.8% $2,482,180 2.3% $11,249,145 22.1% Total Estimated Costs $46,871,954 100.0% $7,981,873 100.0% $106,242,592 100.0% $50,939,290 100.0% Residual Land Value ($16,498,427) - ($35,993) - ($39,922,737) - ($16,772,235) - Per Sq. Ft. of Land ($342.23) - ($0.75) - ($320.46) - ($134.63) - As a % of Revenue (54.3%) - (0.5%) - (60.2%) - (49.1%) - Feasibility Finding [2]
Revenue
Land Use Type 1 $28,292,727 93.1% $5,840,600 73.5% $65,477,455 98.7% $26,945,455 78.9% Land Use Type 2 $2,080,800 6.9% $2,105,280 26.5% $842,400 1.3% $7,221,600 21.1% Total Estimated Revenue $30,373,527 100.0% $7,945,880 100.0% $66,319,855 100.0% $34,167,055 100.0% Costs
Land Use Type 1 $35,323,515 88.1% $14,254,062 82.4% $84,245,812 96.7% $33,079,421 74.8% Land Use Type 2 $4,769,372 11.9% $3,043,655 17.6% $2,885,526 3.3% $11,146,309 25.2% Total Estimated Costs $40,092,886 100.0% $17,297,717 100.0% $87,131,338 100.0% $44,225,730 100.0% Residual Land Value ($9,719,359) - ($9,351,837) - ($20,811,484) - ($10,058,675) - Per Acre ($8,782,262) - ($8,450,175) - ($7,276,778) - ($3,517,036) - Per Sq. Ft. of Land ($201.61) - ($193.99) - ($167.05) - ($80.74) - As a % of Revenue (32.0%) - (117.7%) - (31.4%) - (29.4%) - FEASIBILITY FINDING [3]
Source: WRT; Citythinkers; EPS.
[1] This sensitivity analysis reduces the amount of parking spaces to 50% of the initial development program assumptions. [2] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
[3] This sensitivity analysis excludes approximately 75% of estimated development and building fees that would be collected, reflecting those collected by the City only; assumes fees imposed by the County and other applicable agencies would not be waived.
Site 5:
740 & 820 E Shields Ave; 3111 Maroa
Site 4:
706, 720, & 740 E Belmont Ave
% of
Total
% of
Total
% of
Total
Sensitivity Scenarios
SENSITIVITY #2: WAIVED BUILDING FEES [3]
% of
Total
SENSITIVITY #1: REDUCED PKG REQ. [1]
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Economic & Planning Systems, Inc. (EPS) 26
Development Cost and Revenue
Assumptions
EPS formulated a set of development revenues and costs for each of the different land use types based on a variety of sources including interviews with local developers and research from publicly available and subscription-based resources (e.g., CBRE, CoStar, The Gregrory Group, Saylor). This analysis utilizes construction cost assumptions that are estimated to reasonably reflect current economic conditions in the City, although these costs may vary based on multiple factors including the timing and type of construction.
Detailed development cost and revenue assumptions are provided in Appendix B Table B-2. Examples of market-rate residential, office, and retail lease rates are provided in Appendix B Table B-3, Table B-4, Table B-5, and Table B-6.
Conclusions and Next Steps
The residential ownership products in the current market achieve higher values and have lower construction costs compared to the lower achievable market rents and higher construction costs for the 3- and 5-story multifamily rental units. The financially infeasible results for the rental residential land use types and retail space are primarily driven by the cost of development significantly outweighing current market rents. For the rental residential units and retail development scenarios to realize financial feasibility, there would need to be significant rental rate increases or cost reductions, including public subsidies or other financial incentives.
Figure 11 presents the land use type in order by the potential for feasibility, the assumed rents in the current market, and the rent increases by land use type necessary to move the land uses into feasibility.
2 2 Rent increases that move the prototype’s RLV percentage to 10 percent, which is the range reflecting feasibility.
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Figure 11. Land Use Feasibility Summary, Assumed Rents, and Rent Increases to Create Feasibility
3-story Podium
Apartments
•Assumed Monthly
Rent/Unit: $925
•Rents need to increase
by 147% to achieve a
10% RLV
3-story Walk-Up
Apartments
•Assumed Monthly
Rent/Unit: $955 -
$1,430
•Rents need to increase
by 88% to 100% to
achieve a 10% RLV
5-story Podium
Apartments
•Assumed Monthly
Rent/Unit: $1,550 -
$1,800
•Rents need to increase
by 75% to 97% to
achieve a 10% RLV
For-Sale
Townhomes
•Assumed Sales
Price/Unit: $402,520
results in an 8.1%-
11.1% RLV.
•Higher RLV results
from higher density
For-Sale
Bungalows
•Assumed Sales
Price/Unit: $297,400
results in a 15% RLV
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Approaches to Address Feasibility Challenges
As described, significant rental rate increases would be required to achieve financial feasibility in the current market for rental residential and retail prototypes. In addition, the City could consider a variety of methods for reducing costs and overall development risks.
Consider direct public subsidies
• Provide direct loan or grant funding. The City could secure direct funding through federal, State, and regional grants to subsidize desired infill projects in the Tower District.
• Obtain gap financing. The City could explore adoption of one or more innovative financing tools that could be used to help fill funding gaps (e.g., revolving loan fund).
Consider indirect public subsidies
• Waive or defer building and development fees. Jurisdictions have some leverage in instituting policies and programs to address building and development cost constraints. The City also could consider developing a lower fee structure or waiving fees for projects containing affordable housing, infill projects, and other missing housing types to improve project feasibility. • Consider land acquisition and disposition. The City could consider the acquisition of real estate and donate to private developers or allow deferred payment to eliminate, reduce, or defer land costs.
• Fund backbone infrastructure improvements. Although this analysis excluded any costs related to offsite infrastructure improvements, intensified infill development often necessitates upgrades to backbone infrastructure, representing another development cost and feasibility challenge. The City could obtain funding for capital investments in infrastructure to support development in the Tower District.
Streamline development and environmental review processes • Streamline development review. Consider streamlining the development review process for infill projects that meet objective standards by granting ministerial approval. Streamlined development review processes can save time and money by eliminating discretionary reviews, public hearings, and additional environmental review.
• Streamline environmental review. Consider completing a City-sponsored and City-funded California Environmental Quality Act (CEQA) analysis for the Project to pre-clear opportunity sites.
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Consider regulatory changes
• Reduce parking requirements. Parking is a costly addition to many developments, specifically the high costs of structured parking, and reduces the developable space for residential units. Reducing parking requirements can reduce the cost of a project while increasing the density. • Increase building height and density. Consider increasing minimum and maximum allowable densities and zoning requirements to increase the City’s housing capacity, ensure higher density projects (which can lead to greater affordability), and make projects more economically feasible. • Support a wide array of housing types. Update planning regulations to encourage or require new subdivisions to include two-, three-, and four-plexes, or other missing housing types that are designed to look cohesive with adjacent single-family homes.
Encourage placemaking efforts
• Introduce placemaking to increase market rents to support development costs. Placemaking efforts, including public art, community and green space, and temporary or permanent spaces to hold community events or services, in the Tower District can increase property values, elevating market rents to help close the feasibility gap.
Residential and Commercial Anti-Displacement Strategies Improving the Tower District has the potential to contribute to prosperity and an enhanced quality of life for residents and businesses in the district. However, investment can cause real estate prices to rise, displacing existing residents and places of business and potentially changing the community’s cultural history and social structure. Programmatic and public policy interventions are necessary to mitigate gentrification and pressures on the most vulnerable populations.
The City should consider the following parallel policies to support existing residents and businesses.
• Support new and preserve existing affordable rental housing. Examples include rehabilitation programs that subsidize upgrades and other unit improvements to maintain steady rental rates, supporting the construction of Junior/Accessory Dwelling Units (J/ADUs), community land trusts (CLTs), or other policies that allow for collective ownership and tenant control of the Fresno Tower District Site Feasibility Analysis
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Economic & Planning Systems, Inc. (EPS) 30
land. Research on CLTs caution that this type of initiative tends to help moderate-income households, rather than the most vulnerable populations.3 • Strengthen and supplement neighborhood stabilization policies.
Neighborhood stabilization strategies have been found to have a direct and immediate impact to mitigating gentrification and displacement in particular when multiple programs are implemented simultaneously.4 Examples include establishing a tenant protection program, including a tenant right to counsel component; providing down payment and other buying assistance to low-income first-time homebuyers; expanding homelessness prevention programs; and contributing towards home repair programs. • Mitigate potential commercial displacement. Various strategies to mitigate commercial displacement include establishing a heritage tourism program, establishing a legacy business preservation program, imposing commercial rent control measures, and implementing a local hiring ordinance and purchasing program.5
3 Chapple, Karen, and Anastasia Loukaitou-Sideris, 2021. White Paper on Anti-Displacement Strategy Effectiveness. www.urbandisplacement.org/wp-content/uploads/2021/08/19RD018- Anti-Displacement-Strategy-Effectiveness.pdf [Accessed January 2024]. 4 Ibid.
5 Small Business Anti-Displacement Toolkit. https://antidisplacement.org/toolkit/ [Accessed August 2021].
APPENDICES:
Appendix A: Detailed Financial Feasibility
Pro Forma by Opportunity Site
Appendix B: Feasibility Development,
Cost, and Revenue Assumptions
APPENDIX A:
Detailed Financial Feasibility
Pro Forma by Opportunity Site
Table A-1 Feasibility Analysis Pro Forma: Site 1 ....................A-1 Table A-2 Feasibility Analysis Pro Forma: Site 2 (2 pages) ......A-2 Table A-3 Feasibility Analysis Pro Forma: Site 3 (2 pages) ......A-4 Table A-4 Feasibility Analysis Pro Forma: Site 4 (2 pages) ......A-6 Table A-5 Feasibility Analysis Pro Forma: Site 5 (2 pages) ......A-8
DRAFT
Table A-1
City of Fresno
Tower District Feasibility Analysi
s
Feasibility Analysis Pro Forma: Site 1
Item Townhomes % of Total Bungalow Court % of Total
DEVELOPMENT PROGRAM ASSUMPTIONS [1]
Site Acres 0.2 - 0.4 -
Existing Structure Sq. Ft. 4,800 - 4,800 -
Land Use Type 1 (Residential)
Land Use Townhomes Bungalow Court
Tenure For-Sale For-Sale
No. of Units 5 - 1 0 -
No. of Parking Spaces 10 - 10 -
Gross Building Sq. Ft. 6,940 - 9,592 -
Net Leasable/Saleable Sq. Ft. 6,940 - 9,592 -
Land Use Type 2 (Retail)
Land Use - - - -
No. of Parking Spaces - - - -
Gross Building Sq. Ft. - - - -
Net Leasable/Saleable Sq. Ft. - - - -
Total Building GFA 6,940 9,592
Type of Parking 2-Car Garage - Surface -
REVENUE ASSUMPTIONS [2]
For-Sale Units
Gross Sales Revenue $2,012,600 105.3% $2,973,520 105.3% Less Marketing and Commissions 5.0% ($100,630) - ($148,676) -
TOTAL ESTIMATED REVENU
E $1,911,970 100.0% $2,824,844 100.0%
COST ASSUMPTIONS [2] 402,520 297,352
Land Use 1
Direct Building Construction Costs
Existing Structure Demolition $25,440 1.4% $25,440 1.1% Site Work $83,350 4.7% $178,570 7.4%
Building Construction Costs $1,145,100 65.2% $1,438,800 59.9% Total Parking Cost $0 0.0% $70,000 2.9%
Total Direct Building Construction Costs $1,253,890 71.4% $1,712,810 71.4% $181 $179
Other Soft Costs
As a % of Direct Costs 12.0% - - -
Total Other Soft Costs $150,467 8.6% $205,537 8.6%
Building & Development Impact Fees
As a % of Direct Costs 12.0% - - -
Total Building & Development Impact Fees $150,467 8.6% $205,537 8.6% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $27,209 1.5% $37,168 1.5% Fees (2.0% of loan amount) $15,548 0.9% $21,239 0.9%
Total Financing Costs $42,758 2.4% $58,407 2.4%
Developer Fee
As a % of All Costs 10.0%
Total Developer Fee $159,758 9.1% $218,229 9.1%
Subtotal Land Use 1 Costs $1,757,339 100.0% $2,400,520 100.0% TOTAL COSTS $1,757,339 100.0% $2,400,520 100.0%
RESIDUAL LAND VALUE $154,631 $424,324
Per Acre $808,124 $1,035,086
As a % of Value 8.1% 15.0%
Source: EPS.
[1] See Table B-1.
[2]
See Table B-2.
Site 1: 732 N Van Ness Ave
General
Assumptions
Option A Option B
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-1
DRAFT
Table A-2
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 2
Item 3-story MU % of Total 3-story MU % of Total
DEVELOPMENT PROGRAM ASSUMPTIONS [1]
Site Acres 0.2 - 0.2 -
Existing Structure Sq. Ft. 0 - 0 -
Land Use Type 1 (Residential)
Land Use 3-story MU 3-story MU
Tenure Rental Rental
No. of Units 12 - 18 -
No. of Parking Spaces 15 - 15 -
Gross Building Sq. Ft. 9,309 - 13,745 -
Net Leasable/Saleable Sq. Ft. 7,630 - 11,085 -
Land Use Type 2 (Retail)
Land Use Commercial - Commercial -
No. of Parking Spaces 4 - 4 -
Gross Building Sq. Ft. 3,108 - 2,925 -
Net Leasable/Saleable Sq. Ft. 2,294 - 2,114 -
Total Building GFA 12,417 16,670
Type of Parking Surface -
At-Grade Structure -
REVENUE ASSUMPTIONS [2]
Residential Apartment
Gross Potential Income per Year $137,340 6.5% $199,530 7.1% Less Vacancy 5.0% ($6,867) - ($9,977) -
Less Operating & Maintenance Expenses 30.0% ($41,202) - ($59,859) - Net Annual Income $89,271 4.2% $129,695 4.6%
Capitalized Value
Cap Rate 5.5% - - - -
Total Building Value $1,623,109 76.6% $2,358,082 83.8%
Retail
Gross Potential Income per Year $41,292 1.9% $38,052 1.4% Less Vacancy 5.0% ($2,065) - ($1,903) -
Less Operating & Maintenance Expenses 20.0% ($8,258) - ($7,610) - Net Annual Income $30,969 1.5% $28,539 1.0%
Capitalized Value
Cap Rate 6.3% - - - -
Total Building Value $495,504 23.4% $456,624 16.2%
TOTAL ESTIMATED REVENU
E $2,118,613 100.0% $2,814,706 100.0%
Site 2: 1145 N Van Ness Ave
General
Assumptions
Option A Option B
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-2
DRAFT
Table A-2
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 2
Item 3-story MU % of Total 3-story MU % of Total
Site 2: 1145 N Van Ness Ave
General
Assumptions
Option A Option B
COST ASSUMPTIONS [2]
Land Use 1
Direct Building Construction Costs
Existing Structure Demolition - - - -
Site Work $50,000 1.3% $50,000 0.8%
Building Construction Costs $1,954,806 50.3% $3,436,350 55.3% Total Parking Cost $106,237 2.7% $309,533 5.0%
Total Direct Building Construction Costs $2,111,043 54.4% $3,795,883 61.1% $227 $276
Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $253,325 6.5% $455,506 7.3%
Building & Development Impact Fees
As a % of Direct Costs 10.0% - - - -
Total Building & Development Impact Fees $211,104 5.4% $379,588 6.1% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $45,071 1.2% $81,042 1.3% Fees (2.0% of loan amount) $25,755 0.7% $46,310 0.7%
Total Financing Costs $70,825 1.8% $127,352 2.0%
Developer Fee
As a % of All Costs 10.0%
Total Developer Fee $264,630 6.8% $475,833 7.7%
Subtotal Land Use 1 Costs $2,910,927 74.9% $5,234,163 84.2% Land Use 2
Direct Building Construction Costs
Existing Structure Demolition - - - -
Site Work $50,000 1.3% $50,000 0.8%
Building Construction Costs $652,758 16.8% $614,191 9.9% Total Parking Cost $26,763 0.7% $70,467 1.1%
Total Direct Building Construction Costs $729,521 18.8% $734,658 11.8% Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $87,543 2.3% $88,159 1.4%
Building & Development Impact Fees
As a % of Direct Costs 6.0% - - - -
Total Building & Development Impact Fees $43,771 1.1% $44,079 0.7% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $15,065 0.4% $15,171 0.2% Fees (2.0% of loan amount) $8,608 0.2% $8,669 0.1%
Total Financing Costs $23,673 0.6% $23,840 0.4%
Developer Fee
As a % of All Costs - - - -
Total Developer Fee 10.0% $88,451 2.3% $89,074 1.4%
Subtotal Land Use 2 Costs $972,959 25.1% $979,809 15.8% TOTAL COSTS $3,883,886 100.0% $6,213,972 100.0%
RESIDUAL LAND VALU
E ($1,765,273) ($3,399,266)
Per Acre ($7,689,528) ($14,807,202)
As a % of Value (83.3%) (120.8%)
Source: EPS.
[1] See Table B-1.
[2] See Table B-2.
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-3
DRAFT
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 3
Item 5-story MU/Grocery
% of
Total Horizontal MU
% of
Total
DEVELOPMENT PROGRAM ASSUMPTIONS [1]
Site Acres 2.2 - 2.2 -
Existing Structure Sq. Ft. 39,000 - 39,000 -
Land Use Type 1 (Residential)
Land Use 5-story MU/Grocery Horizontal MU
Tenure Rental Rental
No. of Units 164 - 50 -
No. of Parking Spaces 237 - 91 -
Gross Building Sq. Ft. 163,769 - 53,336 -
Net Leasable/Saleable Sq. Ft. 133,609 - 47,600 -
Land Use Type 2 (Retail)
Land Use Commercial - Commercial -
No. of Parking Spaces 24 - 9 -
Gross Building Sq. Ft. 20,101 - 6,411 -
Net Leasable/Saleable Sq. Ft. 14,358 - 5,183 -
Total Building GFA 183,870 59,747
Type of Parking
At-Grade Structure - Surface -
REVENUE ASSUMPTIONS [2]
Residential Apartment
Gross Potential Income per Year $3,046,285 7.7% $856,800 7.6% Less Vacancy 5.0% ($152,314) - ($42,840) -
Less Operating & Maintenance Expenses 30.0% ($913,886) - ($257,040) - Net Annual Income $1,980,085 5.0% $556,920 5.0%
Capitalized Value
Cap Rate 5.5% - - - -
Total Building Value $36,001,552 91.1% $10,125,818 90.0% Retail
Gross Potential Income per Year $292,903 0.7% $93,294 0.8% Less Vacancy 5.0% ($14,645) - ($4,665) -
Less Operating & Maintenance Expenses 20.0% ($58,581) - ($18,659) - Net Annual Income $219,677 0.6% $69,971 0.6%
Capitalized Value
Cap Rate 6.3% - - - -
Total Building Value $3,514,838 8.9% $1,119,528 10.0%
TOTAL ESTIMATED REVENUE $39,516,391 100.0% $11,245,346 100.0% Option A Option B
Site 3: 1349 N Blackstone Ave
General
Assumptions
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-4
DRAFT
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 3
Item 5-story MU/Grocery
% of
Total Horizontal MU
% of
Total
Option A Option B
Site 3: 1349 N Blackstone Ave
General
Assumptions
COST ASSUMPTIONS [2]
Land Use 1
Direct Building Construction Costs
Existing Structure Demolition $103,350 0.1% $103,350 0.5% Site Work $468,645 0.7% $468,645 2.4%
Building Construction Costs $40,942,278 57.8% $11,200,560 56.7% Total Parking Cost $4,741,400 6.7% $639,532 3.2%
Total Direct Building Construction Costs $46,255,673 65.3% $12,412,087 62.8% $282 $233
Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $5,550,681 7.8% $1,489,450 7.5%
Building & Development Impact Fees
As a % of Direct Costs 10.0% - - - -
Total Building & Development Impact Fees $4,625,567 6.5% $1,241,209 6.3% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $987,559 1.4% $264,998 1.3% Fees (2.0% of loan amount) $564,319 0.8% $151,427 0.8%
Total Financing Costs $1,551,878 2.2% $416,426 2.1%
Developer Fee
As a % of All Costs 10.0%
Total Developer Fee $5,798,380 8.2% $1,555,917 7.9%
Subtotal Land Use 1 Costs $63,782,179 90.1% $17,115,088 86.6% Land Use 2
Direct Building Construction Costs
Existing Structure Demolition $103,350 0.1% $103,350 0.5% Site Work $468,645 0.7% $468,645 2.4%
Building Construction Costs $4,221,252 6.0% $1,346,388 6.8% Total Parking Cost $478,600 0.7% $60,468 0.3%
Total Direct Building Construction Costs $5,271,847 7.4% $1,978,851 10.0% Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $632,622 0.9% $237,462 1.2%
Building & Development Impact Fees
As a % of Direct Costs 6.0% - - - -
Total Building & Development Impact Fees $316,311 0.4% $118,731 0.6% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $108,864 0.2% $40,863 0.2% Fees (2.0% of loan amount) $62,208 0.1% $23,350 0.1%
Total Financing Costs $171,071 0.2% $64,214 0.3%
Developer Fee
As a % of All Costs - - - -
Total Developer Fee 10.0% $639,185 0.9% $239,926 1.2%
Subtotal Land Use 2 Costs $7,031,036 9.9% $2,639,184 13.4% TOTAL COSTS $70,813,215 100.0% $19,754,272 100.0%
RESIDUAL LAND VALU
E ($31,296,824) ($8,508,926)
Per Acre ($14,545,014) ($3,954,473)
As a % of Value (79.2%) (75.7%)
Source: EPS.
[1] See Table B-1.
[2] See Table B-2.
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-5
DRAFT
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 4
Item 5-story MU % of Total Horizontal MU/TH % of Total
DEVELOPMENT PROGRAM ASSUMPTIONS [1]
Site Acres 1.1 - 1.1 -
Existing Structure Sq. Ft. 10,000 - 10,000 -
Land Use Type 1 (Residential)
Land Use 5-story MU Horizontal MU/TH
Tenure Rental For-Sale
No. of Units 111 - 15 -
No. of Parking Spaces 123 - 52 -
Gross Building Sq. Ft. 121,975 - 21,200 -
Net Leasable/Saleable Sq. Ft. 105,000 - 21,200 -
Land Use Type 2 (Retail)
Land Use Commercial - Commercial -
No. of Parking Spaces 14 - 14 -
Gross Building Sq. Ft. 9,775 - 12,100 -
Net Leasable/Saleable Sq. Ft. 8,500 - 8,600 -
Total Building GFA 131,750 33,300
Type of Parking
At-Grade Structure - Surface & 2-Car -
REVENUE ASSUMPTIONS [2]
Residential Apartment
Gross Potential Income per Year $2,394,000 7.9% $6,148,000 77.4% Less Vacancy 5.0% ($119,700) - - -
Less Operating & Maintenance Expenses 30.0% ($718,200) - - - Less Marketing and Commissions 5.0% - - ($307,400) - Net Annual Income $1,556,100 5.1% $0 0.0%
Capitalized Value
Cap Rate 5.5% - - - -
Total Building Value $28,292,727 93.1% $5,840,600 73.5% Retail
Gross Potential Income per Year $173,400 0.6% $175,440 2.2% Less Vacancy 5.0% ($8,670) - ($8,772) -
Less Operating & Maintenance Expenses 20.0% ($34,680) - ($35,088) - Net Annual Income $130,050 0.4% $131,580 1.7%
Capitalized Value
Cap Rate 6.3% - - - -
Total Building Value $2,080,800 6.9% $2,105,280 26.5%
TOTAL ESTIMATED REVENUE $30,373,527 100.0% $7,945,880 100.0% Option A Option B
Site 4: 706, 720, & 740 E Belmont Ave
General
Assumptions
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-6
DRAFT
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis Pro Forma: Site 4
Item 5-story MU % of Total Horizontal MU/TH % of Total
Option A Option B
Site 4: 706, 720, & 740 E Belmont Ave
General
Assumptions
COST ASSUMPTIONS [2]
Land Use 1
Direct Building Construction Costs
Existing Structure Demolition $26,500 0.1% $26,500 0.3% Site Work $241,040 0.5% $241,040 2.7%
Building Construction Costs $30,493,825 61.9% $3,498,000 38.6% Total Parking Cost $2,456,667 5.0% $0 0.0%
Total Direct Building Construction Costs $33,218,032 67.4% $3,765,540 41.5% $272 $178
Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $3,986,164 8.1% $451,865 5.0%
Building & Development Impact Fees
As a % of Direct Costs 10.0% - - - -
Total Building & Development Impact Fees $3,321,803 6.7% $376,554 4.2% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $709,205 1.4% $80,394 0.9% Fees (2.0% of loan amount) $405,260 0.8% $45,940 0.5%
Total Financing Costs $1,114,465 2.3% $126,334 1.4%
Developer Fee
As a % of All Costs 10.0%
Total Developer Fee $4,164,046 8.5% $472,029 5.2%
Subtotal Land Use 1 Costs $45,804,510 93.0% $5,192,322 57.2% Land Use 2
Direct Building Construction Costs
Existing Structure Demolition $26,500 0.1% $26,500 0.3% Site Work $241,040 0.5% $241,040 2.7%
Building Construction Costs $2,052,750 4.2% $2,541,042 28.0% Total Parking Cost $283,333 0.6% $100,333 1.1%
Total Direct Building Construction Costs $2,603,623 5.3% $2,908,915 32.1% Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $312,435 0.6% $349,070 3.8%
Building & Development Impact Fees
As a % of Direct Costs 6.0% - - - -
Total Building & Development Impact Fees $156,217 0.3% $174,535 1.9% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $53,765 0.1% $60,069 0.7% Fees (2.0% of loan amount) $30,723 0.1% $34,325 0.4%
Total Financing Costs $84,488 0.2% $94,394 1.0%
Developer Fee
As a % of All Costs - - - -
Total Developer Fee 10.0% $315,676 0.6% $352,691 3.9%
Subtotal Land Use 2 Costs $3,472,439 7.0% $3,879,606 42.8% TOTAL COSTS $49,276,949 100.0% $9,071,928 100.0%
RESIDUAL LAND VALU
E ($18,903,422) ($1,126,048)
Per Acre ($17,080,839) ($1,017,479)
As a % of Value (62.2%) (14.2%)
Source: EPS.
[1] See Table B-1.
[2] See Table B-2.
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-7
DRAFT
City of Fresno
Tower District Feasibility Analysi
s
Feasibility Analysis Pro Forma: Site 5
Item
Whole Site Redev / 5-
story % of Total
Partial Phased / 5-
story % of Total
DEVELOPMENT PROGRAM ASSUMPTIONS [1]
Site Acres 2.9 - 2.9 -
Existing Structure Sq. Ft. 25,500 - 25,500 -
Land Use Type 1 (Residential)
Land Use Whole Site Redev / 5-story Partial Phased / 5-story Tenure Rental Rental
No. of Units 268 - 113 -
No. of Parking Spaces 280 - 147 -
Gross Building Sq. Ft. 279,780 - 108,550 -
Net Leasable/Saleable Sq. Ft. 243,000 - 100,000 -
Land Use Type 2 (Retail)
Land Use Commercial - Commercial -
No. of Parking Spaces 7 - 49 -
Gross Building Sq. Ft. 5,070 - 32,450 -
Net Leasable/Saleable Sq. Ft. 3,900 - 29,500 -
Total Building GFA 284,850 141,000
Type of Parking Half Submerged -
At-Grade Structure -
REVENUE ASSUMPTIONS [2]
Residential Apartment
Gross Potential Income per Year $5,540,400 8.4% $2,280,000 6.7% Less Vacancy 5.0% ($277,020) - ($114,000) -
Less Operating & Maintenance Expenses 30.0% ($1,662,120) - ($684,000) - Net Annual Income $3,601,260 5.4% $1,482,000 4.3%
Capitalized Value
Cap Rate 5.5% - - - -
Total Building Value $65,477,455 98.7% $26,945,455 78.9% Retail
Gross Potential Income per Year $70,200 0.1% $601,800 1.8% Less Vacancy 5.0% ($3,510) - ($30,090) -
Less Operating & Maintenance Expenses 20.0% ($14,040) - ($120,360) - Net Annual Income $52,650 0.1% $451,350 1.3%
Capitalized Value
Cap Rate 6.3% - - - -
Total Building Value $842,400 1.3% $7,221,600 21.1%
TOTAL ESTIMATED REVENUE $66,319,855 100.0% $34,167,055 100.0% Option A Option B
Site 5: 740 & 820 E Shields Ave; 3111 Maroa
General
Assumptions
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-8
DRAFT
City of Fresno
Tower District Feasibility Analysi
s
Feasibility Analysis Pro Forma: Site 5
Item
Whole Site Redev / 5-
story % of Total
Partial Phased / 5-
story % of Total
Option A Option B
Site 5: 740 & 820 E Shields Ave; 3111 Maroa
General
Assumptions
COST ASSUMPTIONS [2]
Land Use 1
Direct Building Construction Costs
Existing Structure Demolition $67,575 0.1% $67,575 0.1% Site Work $622,905 0.6% $622,905 1.2%
Building Construction Costs $69,945,110 65.0% $27,137,500 50.5% Total Parking Cost $5,590,000 5.2% $2,936,667 5.5%
Total Direct Building Construction Costs $76,225,590 70.8% $30,764,647 57.2% $272 $283
Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $9,147,071 8.5% $3,691,758 6.9%
Building & Development Impact Fees
As a % of Direct Costs 10.0% - - - -
Total Building & Development Impact Fees $7,622,559 7.1% $3,076,465 5.7% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $1,627,416 1.5% $656,825 1.2% Fees (2.0% of loan amount) $929,952 0.9% $375,329 0.7%
Total Financing Costs $2,557,369 2.4% $1,032,154 1.9%
Developer Fee
As a % of All Costs 10.0%
Total Developer Fee $9,555,259 8.9% $3,856,502 7.2%
Subtotal Land Use 1 Costs $105,107,848 97.7% $42,421,525 78.9% Land Use 2
Direct Building Construction Costs
Existing Structure Demolition $67,575 0.1% $67,575 0.1% Site Work $622,905 0.6% $622,905 1.2%
Building Construction Costs $1,064,700 1.0% $6,814,500 12.7% Total Parking Cost $130,000 0.1% $983,333 1.8%
Total Direct Building Construction Costs $1,885,180 1.8% $8,488,313 15.8% Other Soft Costs
As a % of Direct Costs 12.0% - - - -
Total Other Soft Costs $226,222 0.2% $1,018,598 1.9%
Building & Development Impact Fees
As a % of Direct Costs 6.0% - - - -
Total Building & Development Impact Fees $113,111 0.1% $509,299 0.9% Financing
Interest (7.0%, 50% LTC, 50% Outstanding) $38,929 0.0% $175,284 0.3% Fees (2.0% of loan amount) $22,245 0.0% $100,162 0.2%
Total Financing Costs $61,174 0.1% $275,446 0.5%
Developer Fee
As a % of All Costs - - - -
Total Developer Fee 10.0% $228,569 0.2% $1,029,166 1.9% Subtotal Land Use 2 Costs $2,514,255 2.3% $11,320,821 21.1% TOTAL COSTS $107,622,103 100.0% $53,742,346 100.0%
RESIDUAL LAND VALU
E ($41,302,248) ($19,575,292)
Per Acre ($14,441,415) ($6,844,541)
As a % of Value (62.3%) (57.3%)
Source: EPS.
[1] See Table B-1.
[2] See Table B-2.
Prepared by EPS 1/19/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx A-9
APPENDIX B:
Feasibility Development,
Cost, and Revenue Assumptions
Table B-1 Development Assumptions ................................. B-1 Table B-2 Development Cost and Revenue Assumptions ........ B-2 Table B-3 Survey of Adjacent Communities ......................... B-3 Table B-4 Townhome and Condominium Comparable
Properties: City of Fresno ................................... B-4 Table B-5 Multifamily Comparable Properties:
City of Fresno ................................................... B-5 Table B-6 Retail Comparable Properties .............................. B-6 Table B-7 Feasibility Analysis: Single Land Use (2 pages) ...... B-7
DRAFT
Table B-1
City of Fresno
Tower District Feasibility Analysi
s
Development Assumptions
Option A Option B Option A Option B Option A Option B Option A Option B Option A Option B Item Townhomes Bungalow Cour t 3-story MU 3-story MU 5-story MU/Grocer y Horizontal MU 5-story MU Horizontal MU/TH Whole Site Redev / 5-stPartial Phased / 5-stor Site & Zoning
Zone CMS CMS CMS CMS NMX NMX CMS CMS CC CC
Lot Area (SF) 8,335 17,857 10,000 10,000 93,729 93,729 48,208 48,208 124,581 124,581 Lot Area (AC) 0.19 0.41 0.23 0.23 2.15 2.15 1.11 1.11 2.86 2.86 Density 26 24 52 78 76 23 100 14 94 39
# of Units 5 10 12 18 164 50 111 15 268 113
Floor Area Ratio 0.83 0.54 1.24 1.67 1.96 0.64 2.73 0.69 2.29 1.12 Building Height 35' 12'-15' 35'-40' 35'-40' 65' 30' 55' 20'-30' 50' 50' Existing Site Structure(s) (SF) 4,800 4,800 0 0 39,000 39,000 10,000 10,000 25,500 25,500 Residential Unit Breakdown
Unit Breakdown 2-3 bedroom 1-2 bedroom 1-2 bedroom 1-2 bedroom 1-2 bedroom 1-3 bedroom 1-2 bedroom 2-3 bedroom 1-2 bedroom 1-2 bedroom Building Construction
Type Walk-up /
Townhome
Walk-up
Bungalow
Walk-up/Apt Podium
w/elevator Apt
Podium w/elevator
Apt
Walk-up/Apt Podium w/elevator
Apt
Walk-up /
Townhome
Podium w/elevator
Apt
Podium w/elevator
Apt
Number of Stories 3 1 3 3 5 2 5 3 5 5
Construction Type Type 5 Wood Type 5 Wood Type 5 Wood Type 5 Wood/ Type I Concrete
Type 5 Wood/ Type
I Concrete
Type 5 Wood Type 5 Wood/ Type I
Concrete
Type 5 Wood Type 5 Wood/ Type
I Concrete
Type 5 Wood/ Type
I Concrete
Gross Building Area (GFA
)
Residential 6,940 9,592 7,630 11,085 133,609 47,600 105,000 21,200 243,000 100,000 Circulation 0 0 2,143 3,029 31,162 6,464 15,750 3,000 36,450 9,000 Amenity 0 0 350 442 4,741 500 2,500 500 1,500 1,500
Commercial 0 0 2,294 2,114 14,358 5,183 8,500 8,600 3,900 29,500 TOTAL Building GFA 6,940 9,592 12,417 16,670 183,870 59,747 131,750 33,300 284,850 140,000 Average Unit Size 1,388 959 636 616 815 952 949 1,413 722 889 Parking
Type 2-Car Garage Surface Surface At-Grade
Structure
At-Grade Structure Surface At-Grade Structure Surface & 2-Car Garage
Half Submerged
Structure & Surface
At-Grade Structure
Spaces 10 10 19 19 261 100 137 66 286 196
Area (SF) 1 1 1 1 2 1 2 1 1 1
# Levels 2 1 2 1 2 2 1 4 1 2
Ratio 0 0 0 0 0 0 0 0 0 0
Open Space (SF)
Min. Onsite Open Space 00 00 00 00 0 0
Source: Citythinkers.
* All calculations are approximations and preliminary estimates and subject to change ** Existing Zoning yields are based on assumed ratios/metrics and not actual "test fit" takeoffs Site 1 Site 2 Site 3 Site 4 Site 5
732 N Van Ness Ave. 1145 N Van Ness Ave. 1349 N Blackstone Ave. 706, 720 & 740 E Belmont Ave. 740 & 820 E Shields Ave.; 3111 Maroa Prepared by EPS 2/2/2024 Z:\Shared\Projects\SAC\222000\222010 Fresno Tower Specific Plan\Models\222010 Fresno Tower District Pro Forma 01-11-24.xlsx B-1
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Table B-2
City of Fresno
Tower District Feasibility Analysis
Development Cost and Revenue AssumptionsItem Assumptions Assumptions Townhome Bungalow Court Low-rise Midrise < 10,000 Sq. Ft. > 10,000 Sq. Ft.
Opportunity Sites Site 1 Option A Site 1 Option B Site 2 Option A Site 2 Option B Site 2 Option A Site 4 Option A Site 3 Option B Site 3 Option A Site 2 Option B Site 4 Option B Site 4 Option B Site 4 Option A Site 3 Option A Site 5 Option B Site 5 Option A Site 3 Option B
Site 5 Option B Site 5 Option A
Market Rate Revenue Assumptions
Residential Revenue [1] [2] per leasable sq. ft. per month - $290.00 $310.00 $1.50 $1.90 - - Retail Revenue [3] per leasable sq. ft./ per month (NNN) - - - - - $1.50 $1.70 Cap Rates [4]
Residential - - 5.50% 5.50% - -
Retail - - - - 6.25% 6.00%
Hard Construction Cost Assumptions
Existing Structure Demolition [5] per building sq. ft. $5.30 - - - - - - Basic Site Work/Grading [6] per land site sq. ft. $10.00 - - - - - - Building Construction Cost [5] [7] per gross building sq. ft. $165 $150 $210 $250 $210 $210 Parking Hard Construction Cost [8]
Surface per space $7,000 - - - - - -
At-Grade and Half Submerged Structure per space $20,000 - - - - - - Source: RedFin; The Gregory Group; CoStar; CBRE Research United States Cap Rate Survey H1 2023, March 2022; Victoria Transport Policy Institute; WGI Parking Solutions; Saylor.com 2020; ENR; EPS. [1]
[2]
[3] Retail lease rates based on comparable listings per CoStar, acce ssed in November 2023, plus a 5-10% premium to reflect current economic conditions. See Table B-6. [4] Cap rates based on data for Multifamily Suburban and Retail in t he western United States per CBRE Cap Rate Survey H1 2023. [5]
[6] Excludes any costs associated with onsite open space improvements beyond basic site work costs. [7] Building construction costs for multifam ily detached units obtained from private real estate developer assumptions for similar products. [8] The 2-car garage costs are included in the building construction costs.
Cost and Revenue
Assumptions
LAND USE TYPE
Multifamily rental rates based on a survey of new apartments in the adjacent cities of Fresno, Clovis, McFarland, Ripon, Stockton, and Visalia as shown in Table B-3, as well as comparables in the City of Fresno as shown in Table B-5 per CoStar as of October 2023. Rents for podium-style apartments include a 25% premium based on case studies of existing projects.
For-Sale revenue figures are based on a survey of new construction in the adjacent cities of Fresno, Clovis, McFarland, Ripon, Stockton, and Visalia as shown in Table B-3, as well as comparables in the City of Fresno from Zillow as shown in Table B-4.
Demolition costs and Building construction costs for multifamily attached and retail space per Saylor.com for 2020 are adjusted using the index for the City of Fresno of 90% and escalated to 2023 dollars per the 2020 to 2023 CCI of 15.6%.
Multifamily Detached
For-Sale
Multifamily Attached
Rental Retail
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Table B-3
City of Fresno
Tower District Feasibility Analysis
Survey of Adjacent Communities (2023$)
Item
Detached Single-
Family Home
Multifamily, Rental Apartment
(2-story garden-style walk-up,
surface and tuck-under parking)
Unit Size 2,000 1,000
Market Value Per Sq. Ft. (New Construction)
Fresno $244 $1.90
Clovis $255 $1.49
McFarland $164 $0.65
Ripon $350 $1.82
Stockton $275 $1.44
Visalia $210 $1.43
Average $250 $1.45
Sources: CA State Treasurer; CoreLogic; CoStar Group; Redfin; Zillow; EPS.
Unit Type
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Table B-4
City of Fresno
Tower District Feasibility Analysis
Townhome and Condominium Comparable Properties: City of Fresno Item Square Feet Year Built Date Sold Sale Price
Sale Price
per SF
Address
6282 E Creek View Ln, Fresno, CA 93727 1,398 2020 6/28/2023 $390,000 $279 1260 E Via Palmi Dr, Fresno, CA 93730 2,278 2020 3/8/2021 $677,500 $297 1242 E Via Palmi Dr, Fresno, CA 93730 2,278 2020 1/19/2021 $675,500 $297 2911 N Leya Dr, Fresno, CA 93727 1,623 2020 12/21/2020 $328,000 $202 2935 N Leya Dr, Fresno, CA 93727 1,623 2020 12/16/2020 $335,500 $207 1206 E Via Palmi Dr, Fresno, CA 93730 2,900 2020 12/15/2020 $810,500 $279 6323 N Alta Vista Ln, Fresno, CA 93722 1,680 2021 9/5/2023 $385,000 $229 6317 Alta Vista Ln, Fresno, CA 93722 1,512 2021 12/19/2022 $389,000 $257 2831 N Leya Dr, Fresno, CA 93727 1,962 2021 5/27/2022 $460,000 $234 6227 E Sasha Dr, Fresno, CA 93727 1,962 2021 9/8/2021 $391,500 $200 6203 E Sasha Dr, Fresno, CA 93727 1,601 2021 8/27/2021 $387,000 $242 2775 N Leya Dr, Fresno, CA 93727 1,641 2021 7/30/2021 $376,000 $229 6222 E Sasha Dr, Fresno, CA 93727 1,641 2021 7/29/2021 $372,500 $227 6230 E Sasha Dr, Fresno, CA 93727 1,627 2021 7/23/2021 $363,000 $223 6228 E Bibi Dr, Fresno, CA 93727 1,627 2021 5/13/2021 $342,500 $211 Total/Average/Weighted Average 27,353 2021 10/21/2021 $473,659 $244 Source: Zillow; EPS.
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Table B-5
City of Fresno
Tower District Feasibility Analysis
Multifamily Comparable Properties: City of Fresno
Item [1] Pro ject Name
Multifamily Projects
8012 N Millbrook Ave Brookside Villas 2019 162 903 18.3 $1,887 $2.09 2817 E Spruce Ave Vintage Park 2019 296 1,018 15.3 $1,908 $1.87 5490 N Salinas Ave The Californian Apartments 2021 120 925 15.3 $1,669 $1.80 2350 E Alluvial Ave The Residences at Rock Ranch 2021 176 1,064 15.3 $2,018 $1.90 9111 N Maple Ave The Rousseau 2022 84 1,158 31.4 $2,034 $1.76 525 W San Jose Ave 525 San Jose 2022 42 1,062 29.6 $2,014 $1.90 5034 W Bullard Ave The Orchards Apartments Phase II 2022 64 863 17.3 $1,605 $1.86 4259 W Bullard Ave Avalon Apartments 2022 192 995 16.2 $1,846 $1.86 5555 N Dante Ave Dante Apartments 2022 80 1,027 15.2 $1,893 $1.84 Total/Weighted Average (Rounded) 2021 1,216 1,002 19.3 $1,880 $1.90 Source: CoStar; EPS.
[1] CoStar data as of October 2023.
Year Built/
Renovated
Multifamily Residential
Avg. Density
(DU/acre)
Avg. Unit
Sq. Ft.
Average Mo.
Rent
Rent per
Sq. Ft.
Total Number
of Units
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Table B-6
City of Fresno
Tower District Feasibility Analysis
Retail Comparable Properties
Item Property Name
Retail < 10,000 Sq. Ft. [1]
2801 W Clinton Ave - 2012 5,627 $17.06 $1.42
3966 N Blackstone Ave Les Schwab 2012 7,952 $13.46 $1.12 1928 W Olive Ave Family Dollar 2014 8,320 $17.16 $1.43
1212 Fresno St ARCO / Subway 2016 3,374 $20.59 $1.72
1987 W Clinton Ave Pad F 2017 3,648 $17.90 $1.49
4007 E Ventura Ave Family Dollar 2017 8,330 $18.08 $1.51 4044 E Belmont Ave Dollar General 2019 7,545 $18.08 $1.51 722 N Blackstone Ave - 2021 2,959 $13.48 $1.12
710 N Blackstone Ave 7-Eleven 2021 2,959 $17.16 $1.43
3015 W Clinton Ave Carl's Jr. 2021 3,200 $17.72 $1.48
1937 W Clinton Ave Shops E 2021 3,775 $18.29 $1.52
Total/Weighted Average (Rounded) 2017 57,689 $17.10 $1.40 Retail > 10,000 Sq. Ft. [1]
1215-1227 Fresno St - 2000 10,530 $17.63 $1.47
3053-3089 E Shields Ave - 2004 69,201 $22.49 $1.87
1432 N Cedar Ave - 2005 19,862 $17.12 $1.43
2625 E Divisadero St Former County Bank 2006 19,053 $17.60 $1.47 1805-1809 Broadway St - 2006 38,498 $12.24 $1.02
1325 W Shields Ave CVS Pharmacy 2011 14,093 $13.44 $1.12 1760-1830 N 1st St - 2016 10,200 $23.32 $1.94
1935 W Clinton Ave Major C 2019 12,096 $17.86 $1.49
Total/Weighted Average (Rounded) 2008 193,533 $18.20 $1.50 Source: CoStar; EPS.
[1] CoStar data for a 3 mile radius from the center of the Tower District as of November 2023.
Retail
Year Built/
Renovated
Rentable
Building Area
Total Monthly
Rent per SF
NNN
Total Annual
Rent per SF
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Table B-7
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis: Single Land Us
e
Option A Option B Option A Option B Option A Option B
Item Townhomes Bungalow Court 3-story MU 3-story MU 5-story MU/Grocery Horizontal MU Site Acres 0.2 0.4 0.2 0.2 2.2 2.2
Residential Units 5 10 12.0 18.0 164.0 50.0
Commercial Square Feet - - 2,294.0 2,114.0 14,358.0 47,600.0 Land Use Type 1
Revenue $1,911,970 - $2,824,844 - $1,623,109 - $2,358,082 - $36,001,552 - $10,125,818 - Costs $1,757,339 - $2,400,520 - $2,910,927 - $5,234,163 - $63,782,179 - $17,115,088 - Residual Land Value $154,631 - $424,324 - ($1,287,818) - ($2,876,081) - ($27,780,627) - ($6,989,270) - Per Acre $808,124 - $1,035,086 - ($5,609,736) - ($12,528,207) - ($12,910,882) - ($3,248,222) - Per Unit $0.71 - $0.97 - ($2.46) - ($3.67) - ($3.89) - ($3.21) - As a % of Revenue 8.1% - 15.0% - (79.3%) - (122.0%) - (77.2%) - (69.0%) - Feasibility Finding [1] - - - - - -
Land Use Type 2
Revenue - - - $495,504 - $456,624 - $3,514,838 - $1,119,528 - Costs - - - - $972,959 - $979,809 - $7,031,036 - $2,639,184 - Residual Land Value - - - - ($477,455) - ($523,185) - ($3,516,198) - ($1,519,656) - Per Acre - - - - ($2,079,792) - ($2,278,995) - ($1,634,132) - ($706,251) - Per Building Sq. Ft - - - - ($208.13) - ($247.49) - ($244.89) - ($31.93) - As a % of Revenue - - - - (96.4%) - (114.6%) - (100.0%) - (135.7%) - Feasibility Finding [1] - - - - - - - -
Source: WRT; Citythinkers; EPS.
[1] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
Feasibility Summary
Site 1: 732 N Van Ness Ave Site 2: 1145 N Van Ness Ave Site 3: 1349 N Blackstone Ave % of
Total
% of
Total
% of
Total
% of
Total
% of
Total
% of
Total
SINGLE LAND USE
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Table B-7
City of Fresno
Tower District Feasibility Analysis
Feasibility Analysis: Single Land Us
e
Option A Option B Option A Option B
Item 5-story MU Horizontal MU/TH
Whole Site Redev /
5-story
Partial Phased / 5-
story
Site Acres 1.1 1.1 2.9 2.9
Residential Units 110.7 15.0 268.0 112.5
Commercial Square Feet 8,500.0 8,600.0 3,900.0 100,000.0 Land Use Type 1
Revenue $28,292,727 - $5,840,600 - $65,477,455 - $26,945,455 - Costs $45,804,510 - $5,192,322 - $105,107,848 - $42,421,525 - Residual Land Value ($17,511,783) - $648,278 - ($39,630,393) - ($15,476,071) - Per Acre ($15,823,375) - $585,774 - ($13,856,847) - ($5,411,240) - Per Unit ($3.63) - $0.99 - ($3.39) - ($3.16) -
As a % of Revenue (61.9%) - 11.1% - (60.5%) - (57.4%) - Feasibility Finding [1] - - - -
Land Use Type 2
Revenue $2,080,800 - $2,105,280 - $842,400 - $7,221,600 - Costs $3,472,439 - $3,879,606 - $2,514,255 - $11,320,821 - Residual Land Value ($1,391,639) - ($1,774,326) - ($1,671,855) - ($4,099,221) - Per Acre ($1,257,464) - ($1,603,253) - ($584,568) - ($1,433,301) - Per Sq. Ft. of Land ($163.72) - ($206.32) - ($428.68) - ($40.99) - As a % of Revenue (66.9%) - (84.3%) - (198.5%) - (56.8%) - Feasibility Finding [1] - - - -
Source: WRT; Citythinkers; EPS.
[1] Static residual land value feasibility analysis benchmarks generally reflect the indicators shown below.
Likely to be Feasible:
May be Feasible:
Likely to be Infeasible:
Feasibility Summary
Site 4: 706, 720, & 740 Site 5: 740 & 820 E Shields Ave; % of
Total
SINGLE LAND USE
% of
Total
% of
Total
% of
Total
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