Agenda packet, regular meeting — Laguna Hills City Council, March 8, 2022 (part 3 of 3)

All Other Governmental Agency
Permits/Approvals (i.e., approvals by
governmental agencies other than City)
** County of Orange review of Phased Final
Subdivision Maps addressed separately,
above.
**Other Governmental Agencies may
include, but not be limited to, Orange County
Fire Authority, Orange County Health Care
Agency, El Toro Water District, Saddleback
Valley Unified School District (payment of
fees only), and the State of California
(elevators).
**Administrative Delay does not apply to
review or approvals of utility companies or
other agencies that are not governmental
agencies, including, but not limited to,
Type of City or Other Agency Action,
Approval, or Permit
90 Days (Cumulative)
**Includes the cumulative time for Agency
review following submission of an initial
complete application to the Agency for which
a permit or ministerial approval is requested.

Does not include periods of time Owner is
making corrections between submittals.
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Packet Pg. 314 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) Exhibit G-4
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Reasonable Time Period for Processing
and Acting on
Request/Submittal/Application
Southern California Edison, Southern
California Gas Company, AT&T, etc.

Type of City or Other Agency Action,
Approval, or Permit
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Packet Pg. 315 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing)

EXHIBIT H

PROCEDURES AND REQUIREMENTS FOR PREPARATION, SUBMITTAL,

REVIEW, APPROVAL, AND INSTALLATION OF PUBLIC ART
This Exhibit H sets forth the procedures and requirements for preparation, submittal, review, approval, and installation of Public Art for the Village at Laguna Hills Project (the “Project”) in accordance with Section 7.4 of the Development Agreement. The Project an integrated mixed-use development on approximately 68 acres consisting of multiple components, including Public Art installations, which Owner contemplates developing in multiple phases over the Term of the Development Agreement. This Exhibit H is intended to establish procedures and requirements to ensure that the Public Art required in conjunction with the Project is installed in an integrated, thought-out, and cohesive manner consistent with the goals, objectives, and standards of the Specific Plan’s “Public Art” provisions.

I. Owner’s Public Art Obligation
A. Owner’s Public Art Obligation. Section 7.4 of the Development Agreement provides that Owner shall furnish Public Art in connection with the Project and/or pay a Public Art In-lieu Fee with a combined minimum aggregate value of one-half percent (0.5%) of the total aggregate construction costs of the Project (“Owner’s Public Art Obligation”). For this purpose, construction costs are based on the valuation as determined by the City’s Community Development Director and indicated on the building applications submitted in order to obtain permits for construction of all of the Project components. City will determine the portion of Owner’s Public Art Obligation attributable to each discreet Project component at the time City receives an application for permits for construction such Project component by multiplying the construction cost of such Project component, as determined by City, by one-half percent (0.5%) (“Component Public Art Obligation”). The sum at any point in time of the Component Public Art Obligation for each building permit that has been approved and/or applied for is referred to herein as “Owner’s Accrued Public Art Obligation.”
B. In-Lieu Payment Contribution. Pursuant to Section 7.4 of the Development Agreement, the Parties have agreed that Six Hundred Fifty Thousand Dollars ($650,000) of Owner’s Public Art Obligation will be satisfied by the Three Hundred Thousand Dollar ($300,000) credit and Three Hundred Fifty Thousand Dollar ($350,000) nonrefundable advance described in Section 10.4 of the Development Agreement (collectively, “Owner’s In-Lieu Payment Contribution”). Owner and City agree that Owner’s In-Lieu Payment Contribution correlates to a total aggregate construction cost of One Hundred Thirty Million Dollars ($130,000,000) [$650,000 / 0.5% = $130,000,000].

C. Actual Art Obligation. Pursuant to Section 7.4 of the Development Agreement, the Parties have agreed that that portion of Owner’s Public Art Obligation that exceeds Six Hundred Fifty Thousand Dollars ($650,000) must be satisfied through the actual provision of Public Art on the Property (“Owner’s Actual Art Obligation”). Unless otherwise proposed by Exhibit H-1
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Packet Pg. 316 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) Owner and included as a requirement within the Conceptual Project Art Program approved pursuant to Section II, Owner and City agree that Owner’s Actual Art Obligation will not be triggered until the estimated total aggregate construction cost of Project components exceeds One Hundred Thirty Million Dollars ($130,000,000). Consistent with the Specific Plan, expenses that may be attributed to Owner’s Actual Art Obligation include the artist fee for design and fabrication, mountings and bases for installation of the artwork, and lighting that is integral to the artwork, but do not include landscaping surrounding the art, delivery expenses, or installation costs. That portion of Owner’s Accrued Public Art Obligation that exceeds Six Hundred Fifty Thousand Dollars ($650,000) is referred to herein as “Owner’s Accrued Actual Art Obligation.”
II. Conceptual Project Art Program
A. Conceptual Project Art Program Required. Before the first building permit for any building in the Project is issued, Owner shall prepare, submit, and obtain City approval of a concept Public Art program for the entire Project (the “Conceptual Project Art Program”). All Public Art that is thereafter constructed and installed on the Property must be consistent with the approved Conceptual Project Art Program.

B. Conceptual Project Art Program Components. The Conceptual Project Art Program shall include the following components:

1. Goals and Objectives. A description of the goals and objectives of the Conceptual Project Art Program.

2. Theme. A description of the proposed theme of the Public Art to be installed on the Property.

3. Standards. Standards governing type, media, materials, size, scope, and content of Public Art to be installed on the Property. All standards should be consistent with the Specific Plan provisions for Public Art. Owner shall consider the following when developing proposed standards for Public Art installations:
a. Relevance of the artwork to the City, its values, culture, and people;
b. Suitability of the artwork for outdoor display, including its maintenance and conservation requirements.
c. Relationship of the artwork to the site, especially how it serves to activate or enhance public space.
d. Appropriateness of the scale of the artwork.
e. Community standards of decency;
Exhibit H-2
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Packet Pg. 317 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) f. Construction and material standards for Public Art set forth in the “Public Art” provisions of Section V of the Specific Plan. Pursuant to the Specific Plan, permissible types of Public Art include, but are not limited to, sculptures, paintings, graphic arts, mosaics, photographs, fountains, decorative arts, and the preservation of historical or cultural resources. The Specific Plan also requires that artwork be constructed of durable, long-lasting materials that can withstand outdoor display and require low maintenance. Recommended materials include bronze, stainless steel, high-grade aluminum or hard stones. In addition, the Specific Plan states that artworks incorporating water features must be designed so that the artwork can stand on its own should the water cease to function properly.

4. Location. A description and depiction of the locations where Public Art is anticipated to be installed and standards for locating Public Art. Consistent with the Specific Plan, Public Art installations (i) should be located in places that are open and easily accessible to the public; (ii) should be prominently placed within the Property; (iii) should be oriented toward the pedestrian experience of the Project and/or located within the Village Park; and (iv) should not be sited near monument signs, walls, benches, or utility boxes, since these structures may block viewing the art and diminish the aesthetic value of the artwork.

5. Criteria for Selection of Artists. A description of how artists commissioned to create or fabricate original art for the Project willshall be selected and the criteria that willshall be used to select artists. Pursuant to the Specific Plan, artists selected must have experience in design concepts, fabrication, installation and long-term durability of large-scale outdoor artworks, and be approved by the City’s Planning Agency prior to selection. Owner may, but is not required, to include a list of proposed artists and their qualifications as part of the Conceptual Project Art Program.

6. Drawings and Illustrations. Owner is encouraged to include concept drawings, illustrations, and/or visual examples depicting the type, nature, size, scale, and location of the types of Public Art envisioned by the Conceptual Project Art Program. At Owner’s option, Owner may include illustrations of specific proposed Public Art installations.

7. Phasing Plan. A phasing plan for the funding and installation of Public Art.
a. The phasing plan shall provide for the funding and installation of Public Art on the Property within timeframes consistent with the anticipated phasing of the Project components and infrastructure and shall establish outside dates within the Term of the Development Agreement by which Public Art installations at specified locations or areas of the Property willshall be completed.

At a minimum, the phasing plan shall ensure that Public Art with a minimum Exhibit H-3
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Packet Pg. 318 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) value equal to or exceeding the amount of Owner’s Accrued Actual Art Obligation attributable to the Project components Owner is required to Develop in Phase One shall be installed prior to the date Owner is required to Complete Construction of such required Phase One components pursuant to Subsection

5.4.1 of the Development Agreement.
b. If the phasing plan contemplates that funds will be accumulated within a Public Art Fund established pursuant to Section V to facilitate the financing and planning of larger, Project-serving Pubic Art installations, it shall address the anticipated amounts needed to fund such Public Art installations, the anticipated timing of completion of such Public Art installations, and any applicable requirements or limitations with respect to deposits to or withdrawals from the Public Art Fund for such Public Art installations. c. The phasing plan shall address how Owner’s In-Lieu Payment Contribution willshall be applied to satisfy Owner’s Public Art Obligation in relation to the sequence of issuance of building permits for construction of Project components. Unless otherwise proposed by Owner and included as a requirement within the approved Conceptual Project Art Program, Owner is not required to install any Public Art until the estimated total aggregate construction cost of Project components exceeds One Hundred Thirty Million Dollars ($130,000,000).

Notwithstanding the foregoing, at Owner’s option, the phasing plan may require the installation of Public Art in conjunction with the construction of Project components before the estimated total aggregate construction cost of the Project components exceeds One Hundred Thirty Million Dollars ($130,000,000). d. At Owner’s option, the phasing plan may include requirements for the funding and/or installation of Public Art in conjunction with the development of specific parcels of the Property and/or components of the Project, which willshall be binding on and enforceable against future transferees, assignees, and developers.

7. Maintenance Standards. Proposed minimum maintenance standards for Public Art that is installed on the Property.

8. O&M Funding and Implementation. A description of the mechanism through which operation and maintenance of Public Art installed on the Property willshall be funded and implemented for the life of the Project.

C. Review and Approval by Planning Agency. The Conceptual Project Art Program shall be subject to review by the City’s Planning Agency for conformance with the requirements and goals of the Specific Plan’s Public Art provisions. Owner understands and agrees that approval of Owner’s submitted Conceptual Project Art Program is subject to the discretionary approval of the City's Planning Agency, subject to applicable limits of state and federal law.

Exhibit H-4
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Packet Pg. 319 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) D. Amendments. The Conceptual Project Art Program may be amended from time to time with the approval of the City’s Planning Agency.

III. Final Art Submittals
A. Final Art Submittal Required. Before fabricating and installing any piece of Public Art, Owner must prepare, submit, and obtain City approval of final plans and specifications for such Public Art (“Final Art Submittal”).

B. Required Content of Final Art Submittals. Each Final Art Submittal shall describe and demonstrate how the proposed Public Art is consistent with the approved Conceptual Project Art Program and the Specific Plan and shall include, without limitation, detailed plans and specifications, schematics, and descriptions of the type, size, medium/material, location, content, and value of the proposed Public Art, a description of the proposed artist(s), a proposed timeline for installation of the Public Art, and a complete application for any Subsequent Development Approvals required for installation of the Public Art. More than one Public Art installation may be combined in a single Final Art Submittal.

C. Review and Approval by Planning Agency. The design, artist, type, size, medium, location, content, estimated value, and timeline for installation of each Public Art installation shall be subject to review the City’s Planning Agency for consistency with the Conceptual Project Art Program and conformance with the requirements and goals of the Specific Plan’s Public Art provisions. Owner understands and agrees that approval of each Final Art Submittal is subject to the discretionary approval of the City's Planning Agency, subject to the applicable limits of state and federal law; provided, however, that Planning Agency may not deny or impose conditions on a proposed Final Art Submittal based on aspects of the proposed Public Art that conform to the Conceptual Project Art Program approved by the Planning Agency.

IV. Installation of Approved Public Art
A. Obligation. Owner shall install approved Public Art within the timeframes set forth in the Conceptual Project Art Program phasing plan and each Final Art Submittal approved by the City’s Planning Agency.

B. Time Extensions. Time extensions not exceeding six (6) months may be approved by the City Manager, in his or her reasonable discretion. Time extensions exceeding six (6) months shall require approval of the Planning Agency, in its reasonable discretion.

C. Excusable Delay. The timeframes in which Owner is required to install Public Art shall be subject to extension for periods equal to the duration of any excusable delay pursuant to Section 22.1 of the Development Agreement.

Exhibit H-5
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Packet Pg. 320 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) D. Withholding of Permits for Noncompliance. In addition to any other remedies available to City, Owner’s failure to complete installation of Public Art within required timeframes shall entitle City to withhold future building permits or certificates of occupancy for the Project until Public Art of a value equal or exceeding the amount of Owner’s Accrued Actual Art Obligation has been installed.

V. Public Art Fund
A. Establishment of Public Art Fund. Rather than installing a separate Public Art installation in conjunction with the construction of each building to satisfy Owner’s Actual Art Obligation, Owner may accumulate funds in a fund held in trust by the City (the “Public Art Fund”) to facilitate the financing and planning of larger, Project-serving Public Art installations as provided in the approved Conceptual Project Art Program.

B. Effect of Deposits into Public Art Fund. Subject to any applicable requirements or limitations set forth in the approved Conceptual Project Art Program, deposits by Owner into the Public Art Fund in an amount equal to one-half percent (0.5%) of the estimated construction cost of any discreet Project component, as determined by City, shall permit Owner to obtain building permits and/or certificates of occupancy for such Project component prior to approval of Final Art Submittals for, and/or installation of, specified Public Art installations. Such deposits into the Public Art Fund shall not be deemed to satisfy or excuse Owner’s obligation under the Development Agreement to install actual Public Art.

C. Withdrawals from Public Art Fund. Following approval by the City’s Planning Agency of a Final Art Submittal for a Public Art installation intended to be financed with funds held in the Public Art Fund, Owner may withdraw funds from the Public Art Fund in an amount up to the estimated value of the Public Art installation, as determined by the Planning Agency in conjunction with approval of the Final Art Submittal. Consistent with the Specific Plan, allowable expenses attributable to the value of a Public Art installation include the artist fee for design and fabrication, mountings and bases for installation of the artwork, and lighting that is integral to the artwork, but do not include landscaping surrounding the art, delivery expenses, or installation costs.

D. Forfeiture in the Event of Expiration, Termination, or Cancellation of Development Agreement. In the event the Development Agreement expires or is terminated or cancelled pursuant to the terms of the Development Agreement, and Owner’s Accrued Actual Art Obligation has not been satisfied by the date of such expiration, termination or cancellation, that portion of the funds, if any, held in the Public Art Fund equal to the difference between Owner’s Accrued Actual Art Obligation and the value of Public Art that has actually been installed shall be forfeited to the City and deposited into City’s Public Art In-Lieu Fund.

VI. Project Building and Occupancy Permits
A. Building Permits. In order to be entitled to issuance of a building permit for any discreet Project component, Owner must demonstrate that the combination of (1) the value of Exhibit H-6
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Packet Pg. 321 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing) specific Public Art installations already approved by the City’s Planning Agency, and (2) the amount deposited by Owner into a Public Art Fund to fund larger, Project-serving Public Art installations pursuant to the approved Conceptual Project Art Program, equals or exceeds the amount of Owner’s Accrued Public Art Obligation.

B. Certificates of Occupancy. In order to be entitled to issuance of a final certificate of occupancy for any building, Owner must demonstrate that it is in compliance with the timeframes for installation of Public Art set forth in the Conceptual Project Art Program phasing plan and all approved Final Art Submittals.

Exhibit H-7
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Packet Pg. 323 Attachment: Attachment i - Development Agreement in Redline Version (2767 : Village at Laguna Hills Continued Public Hearing)

STRADLING YOCCA CARLSON & RAUTH

A PROFESSIONAL CORPORATION
4873-6005-7099V3/200305-0005
155989848.1

OUTLINE

VILLAGES OF LAGUNA HILLS DEVELOPMENT AGREEMENT
Capitalized terms are defined in the Development Agreement. [ALL CAPS SHOWS

ITEMS ADDED SINCE THE ORIGINAL DEVELOPMENT AGREEMENT WAS PRESENTED TO THE CITY COUNCIL.]
I. Project Description
A. Phase One – To be completed within seven (7) years

1. The Village Park.

2. The Hotel.

3. At least 140,000 square feet of space within Retail Buildings.

4. At least two (2) of the Residential Buildings I, II, III and/or V.1

5. Up to 465,000 square feet of office space within four (4) Office Buildings (at Owner’s election).

B. Phase Two

1. Additional Retail Space in excess of 140,000 square feet not constructed in Phase One including a minimum total of not less than 210,000 square feet up to a total of 250,000 square feet.

2. Each of Residential Buildings I, II, III and/or V not constructed in Phase One, the remainder of the 200 Affordable Units not constructed in Phase One, and Residential Building IV

3. The remainder of the office space not constructed in Phase One (at Owner’s election).

II. Term
A. 15 years.
1 The allocation of the Affordable Units is shown as follows: Building Number – Total Units/Lower Income/Moderate Income. For example, Building I has a total of 358 Residential Units of which 31 will be Lower Income and 31 will be Moderate Income shown as I – 358/31/31.

I– 358/31/31
II– 230/20/20
III– 300/25/25
V– 275/24/24
Total 1163/100/100
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B. Extension for five (5) years if, prior to 15 years, Owner has Completed Construction of required elements of Phase One and has obtained building permits for construction of the required elements of Phase Two.

III. Owner Benefits
A. Owner is granted the vested right to rely on Existing Land Use Regulations, including the fixing of Development Fees, for the Term.

IV. City Benefits
A. City also has the right to assert the Existing Land Use Regulations, for the Term.

B. A commitment by the Owner to complete the following elements of the Project.2

1. 100 Lower Income Units and 100 Moderate Income Units in partial satisfaction of RHNA obligations.

2. The Village Park.

3. 210,000 square feet of retail space.

4. The Hotel TO BE COMPLETED PRIOR TO THE GRANTING OF

CERTIFICATES OF OCCUPANCY FOR THE THIRD RESIDENTIAL
BUILDING.
3 5. Residential Buildings I, II, III, and V.

C. Development Fees, Community Benefit Fees, and Other Fees.

1. Normal fees for processing.

2. Annual Development Agreement fee of Twenty Thousand Dollars ($20,000) per year increased at the rate of 3% per annum.

3. Normal fees and taxes payable to City
2 The City’s remedies are limited to retention of Community Benefit Fees (described in IV.C., below), withholding permits, and/or termination of the Development Agreement. 3 The City’s remedies for failure to timely complete the hotel are limited to: (1) withholding Certificates of Occupancy for the fourth and fifth residential buildings (absent Excusable Delay re Hotel due to hotel market failure; (2) additional Community Benefit Fees of $396 annually per occupied residential unit; and (3) $500,000 Community Benefit Fee payment if the hotel is not completed by year seven. Other remedies, including but not limited to termination or withholding of certificate of occupancy for the third residential building, are not available. j
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4. $2,227,066 Community Benefit Fees, $1,113,533 payable 90 days after the Development Agreement Date and $1,113,533 payable within fifteen (15) months of the Development Agreement Date.

5. Public Park In-Lieu Fees at the rate of $15,636 per Residential Unit payable:
a. $2,000,000 90 days after the Development Agreement Date. b. $2,000,000 upon the earlier of
(i) Issuance of building permits for the First Retail Building or the First Office Building, or
(ii) 4 years after the Development Agreement Date.
c. $2,000,000 upon the earlier of
(i) Issuance of Certificate of Occupancy for the First Retail Buildings or the First Office Buildings, or
(ii) 7 years after the Development Agreement Date.
d. $6,571,344 payable
(i) $8,173 per Residential Unit for each of the first 804 Residential Units prior to issuance of building permits for such Residential Buildings.
(ii) Remaining balance on or before the 7th Anniversary Date of the Development Agreement.
e. $5,597,688 payable, as follows
(i) 15,636 for each of next 358 Residential Units.
(ii) Balance due on the 15th Anniversary Date of the
Development Agreement.
f. $15,636 per Residential Unit for all units after the 1162nd Residential Unit.

6. Public Art In-lieu Fees
a. Owner credited with $300,000 paid in connection with Five Lagunas Entitlements.
b. $350,000 on before the 90th day following the Development Agreement Date.
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7. Additional Community Benefit Fees
a. All Community Benefit Fees described in C.5 not used as a credit against Public Park In-Lieu Fees.4
b. CONTINGENT FISCAL IMPACT FEE (HOTEL) – $396 PER

RESIDENTIAL UNIT PER YEAR, INFLATED AT THE RATE
OF 3 PERCENT PER ANNUM COMPOUNDED ANNUALLY,

FOR EACH RESIDENTIAL UNIT IN A RESIDENTIAL

BUILDING FOR WHICH CERTIFICATES OF OCCUPANCY
HAVE BEEN GRANTED PAYABLE FOR THE FULL 20

YEAR TERM, BUT TERMINATED UPON OPENING OF THE
HOTEL. In addition, if the Hotel is not constructed within seven (7) years, Owner shall pay an additional Community Benefit Fee of $500,000 in year SEVEN.
c. CONTINGENT FISCAL IMPACT FEE (RETAIL) – $120 PER
RESIDENTIAL UNIT (IN EXCESS OF 805 RESIDENTIAL

UNITS) PER YEAR, INFLATED AT THE RATE OF
3 PERCENT PER ANNUM COMPOUNDED ANNUALLY, IN
THE EVENT THAT LESS THAN 60,000 SQUARE FEET OF

NEW RETAIL IS NOT LEASED BY THE EARLIER OF

COMPLETION CONSTRUCTION OF THE THIRD

RESIDENTIAL BUILDING PAYABLE FOR THE FULL
20 YEAR TERM BUT TERMINATED UPON LEASING OF
THE NEW RETAIL.
d. FISCAL IMPACT FEE (GENERAL) – $120 PER

RESIDENTIAL UNIT, INFLATED AT THE RATE OF
3 PERCENT PER ANNUM COMPOUNDED ANNUALLY,

FOR EACH RESIDENTIAL UNIT IN RESIDENTIAL

BUILDINGS FOR WHICH CERTIFICATES OF OCCUPANCY

HAVE BEEN ISSUED PAYABLE FOR THE TERM,
INCLUDING ANY EXTENSION OF THE TERM. UPON

ANY EARLY TERMINATION FOR A CAUSE OTHER THAN

CITY DEFAULT, OWNER REMAINS OBLIGATED TO PAY
THIS FEE FOR 16 YEARS FROM DEVELOPMENT
AGREEMENT DATE. .
e. By way of example of the Additional Community Benefit Fees described in IV.C., assume Residential Building II, III and IV are constructed totaling 805 Residential Units by end of year seven (7), but the Hotel is not completed and the New Retail is not leased at that point in time.
4 Any portion of the Public Park-in-Lieu Fees paid before they are due are considered Community Benefit Fees until earned, at which point they are credited against Public Park In-Lieu Fees. j
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A PROFESSIONAL CORPORATION
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Owner’s obligation would be
$147.585 x 805 = $118,801.90per year
$487.036 x 805 = $392,059.19 per year
Total $510,861.05 per year
Plus a one time payout of $500,000 in year seven.
5 Inflated at 3% per annum
6 The Contingent Impact Fee (Retail) is not payable until the Residential Unit count exceeds 805. j
Packet Pg. 328 Attachment: Attachment j - Development Agreement Outline Summary (2767 : Village at Laguna Hills Continued Public Hearing) RESOLUTION NO. _______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF LAGUNA HILLS, CALIFORNIA, DENYING THE

REQUEST BY MGP FUND X LAGUNA HILLS, LLC FOR

APPROVAL OF A DEVELOPMENT AGREEMENT FOR
THE VILLAGE AT LAGUNA HILLS PROJECT.

The City Council of the City of Laguna Hills, California, hereby finds, determines, and declares as follows:

1. MGP Fund X Laguna Hills, LLC (“Applicant”) is the owner of and/or has an equitable interest in, the existing approximately 68-acre former Laguna Hills Mall site generally located along the southerly side of El Toro Road and the westerly side of Avenida de la Carlota in the City of Laguna Hills, located at 24155 Laguna Hills Mall (the “Property”).

2. In March 2016, the City approved Site Development Permit, Master Sign Program, Conditional Use Permit, Parking Use Permit, Vesting Tentative Tract Map, and Precise Plan No. 2-15-3114 for the Property, which authorized redevelopment of the existing Laguna Hills Mall and the Property with a mixed-use retail and residential project branded “Five Lagunas.”

3. On July 18, 2018, the City Council approved the first phased final map for a portion of the Five Lagunas Project.

4. The Applicant has now filed an application (Case No. USE-0010-2019) for approval of a Development Agreement and related discretionary development permits, which, if approved, would permit modifications to the approved 2016 Five Lagunas Project and provide the Applicant with vested rights to develop the proposed modified project for a term that is longer than the Applicant would otherwise be entitled under state and local law (the “Village at Laguna Hills Project” or the “Modified Project”). The discretionary development permits requested in conjunction with the Development Agreement include:
a site development permit for the proposed Modified Project; a master sign program for various on-site signs; conditional use permits for a new health club facility and a hotel; a conditional use permit to allow shared parking; a vesting tentative tract map to resubdivide the Property into 16 lots; and, a precise plan for mixed use development of the Property (collectively, the “Development Permits”).

5. The City Council serves as, and is, the Planning Agency of the City pursuant to Government Code Section 65100.

6. Under the Laguna Hills Municipal Code, applicants are not required to apply for or enter into a development agreement in conjunction with requests for approval of discretionary development permits; however, the Applicant has voluntarily applied for and requested the City enter into a Development Agreement in conjunction with and as part of its application for approval of the Development Permits because approval of a k
Packet Pg. 329 Attachment: Attachment k - Resolution Denying the Development Agreement (2767 : Village at Laguna Hills Continued Public Hearing)

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Development Agreement would provide the Applicant with greater development rights than would otherwise be allowed under state and local law. These greater development rights include, but are not limited to, the right to develop the Modified Project beyond the term otherwise provided by applicable law and more flexibility in the order and sequencing of development than the Applicant would otherwise be entitled to by right. The Development Agreement and related Development Permits were processed as, presented as, and consistently treated as a single development application, and are inextricably intertwined, such that approval of the Development Permits is dependent on approval of the Development Agreement. At no time during the application process has the City been requested to consider approval of the Development Permits and/or accompanying related conditions of approval separately from the Applicant’s request for approval of the Development Agreement. The recommended conditions of approval associated with the Development Permits were prepared in conjunction with negotiation of the proposed Development Agreement, through concurrent processing, and with the understanding that the Development Agreement would be approved as a necessary and indispensable part of the overall Modified Project, as requested by the Applicant. For example, in many cases, the proposed conditions of approval specifically refer to terms in the proposed Development Agreement. If the Applicant had not applied for approval of the Development Agreement in conjunction with its request for Development Permits, City staff would have recommended different conditions of approval for the Development Permits.

7. On April 2, 2021 and April 5, 2021, the City caused public notice to be given of the City Council's intention to consider the proposed Development Agreement and related Development Permits. The public notice described the Development Agreement and related Development Permits as a single application.

8. On April 27, 2021, June 24, 2021, June 29, 2021, and March 8, 2022, the City Council held a public hearing on the proposed Development Agreement and related Development Permits.

9. At its meeting of June 29, 2021, a majority of the City Council members expressed disagreement with many of the terms and conditions of the proposed Development Agreement for the Village at Laguna Hills Project as presented and directed that the City engage in further negotiations with the Applicant regarding the terms of the Development Agreement.

10. In accordance with the City Council’s direction, the City has continued to negotiate with the Applicant in good faith regarding the terms of the proposed Development Agreement.

11. Despite these good faith negotiations, the City and the Applicant have been unable to reach a meeting of the minds on terms of the Development Agreement that are mutually acceptable to both the Applicant and the City Council. k
Packet Pg. 330 Attachment: Attachment k - Resolution Denying the Development Agreement (2767 : Village at Laguna Hills Continued Public Hearing)

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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAGUNA

HILLS, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

SECTION 1. The above recitals are true and correct and are incorporated herein by reference.

SECTION 2. The terms of the proposed Development Agreement presented to the City Council are unacceptable to the City; therefore, the Applicant’s request for approval of a Development Agreement for the proposed Village at Laguna Hills Project is hereby denied.

SECTION 3. Because the Applicant voluntarily applied for and requested the City enter into a Development Agreement in conjunction with and as an integral part of its application for approval of the Development Permits, and approval of the Development Agreement is denied, the City is unable to take action regarding the Development Permits.

SECTION 4. Adoption of this Resolution is exempt from the California Environmental Quality Act (CEQA) pursuant to the provisions of Article 19, Section 15270 of the CEQA Guidelines.

SECTION 5. The advisory ad hoc committee established on September 28, 2021, for the single-purpose of directing further development agreement negotiations for the Village at Laguna Hills Project is hereby dissolved.

DENIED AND ADOPTED this 8th day of March, 2022.
________________________________

DAVE WHEELER, MAYOR
ATTEST:
______________________________________

MELISSA AU-YEUNG, CITY CLERK

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STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss

CITY OF LAGUNA HILLS )
I, Melissa Au-Yeung, City Clerk of the City of Laguna Hills, California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. PA2022- adopted by the Planning Agency and City Council of the City of Laguna Hills, California, at a Regular Meeting thereof held on the 8th day of March, 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:
_____________________________________

MELISSA AU-YEUNG, CITY CLERK
k
Packet Pg. 332 Attachment: Attachment k - Resolution Denying the Development Agreement (2767 : Village at Laguna Hills Continued Public Hearing) The Village at Laguna Hills
Attachment l
Project Plans
Due to file size limitations, this attachment is provided via direct City website link where the Project Plans can be viewed and downloaded:
https://lagunahillsca.gov/DocumentCenter/View/6842
(Large file, may take some time to load)
l
Packet Pg. 333 Attachment: Attachment l - Project Plans (Link) (2767 : Village at Laguna Hills Continued Public Hearing) The Village at Laguna Hills
Attachment m
Master Sign Program
Due to file size limitations, this attachment is provided via direct City website link where the Master Sign Program can be viewed and downloaded:
https://lagunahillsca.gov/DocumentCenter/View/6845
(Large file, may take some time to load)
m
Packet Pg. 334 Attachment: Attachment m - Master Sign Program (Link) (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: Say no to the “Village”
From: Kimberly Maag <[email protected]>
Sent: Tuesday, June 29, 2021 5:16 PM
To: Erica Pezold <[email protected]>; Dave Wheeler <[email protected]>; Janine Heft <[email protected]>; Bill Hunt <[email protected]>; Donald M. Sedgwick <[email protected]>; Cindy Sands <[email protected]>; Public Comments <[email protected]>; Melissa Au‐Yeung <MAu‐[email protected]>
Subject: Say no to the “Village”
City Council Laguna Hills City Council and Staff,
I urge the City to reject this project. Many changes should be made before it could be approved: the City should eliminate the proposed Hotel, require improved bicycle connectivity, require a higher percentage of affordable units, and a better landscaping plan.

Imagine if Laguna Hills residents could bike through the property on dedicated bike lanes and onto the Aliso Creek bike trail. The current plan involves four class III bike lanes, which could be as little as painted arrows on the ground. But we need top level bike trails insulated from the street, including where there are proposed bike lanes. All proposed bike routes should be class I bike trails to the fullest extent possible. We urge greater connectivity with the regions’ excellent bike trails.

Sincerely,
Kimberly Maag
Kimberly Maag
[email protected]
26742 Barkstone Ln.

Laguna Hills, California 92653
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 335 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: Agreement Renegotiation -- the Village at Laguna Hills From: Christine Morinello <[email protected]>
Sent: Thursday, July 1, 2021 1:30 AM
To: Public Comments
Subject: Agreement Renegotiation ‐‐ the Village at Laguna Hills

Dear Mayor Erica Pezold, Mayor Pro Tem Don Sedgwick, Councilwoman Janine Heft, Councilman Bill Hunt and Councilman Dave Wheeler:

Thank you all for the many, many long hours of hard work you have devoted to the creation of the Village at Laguna Hills (mall redevelopment). I am a senior citizen resident of Rancho Santa Margarita who has patronized Laguna Hills businesses continuously since moving to Orange County in 1993. The Laguna Hills Mall was always my "go to" and I have been following the redevelopment concepts closely.

It is my understanding that at the June 29, 2021 meeting, the City Council considered eliminating the four office buildings from the Village plan. That would be a very wise move which I urge the City Council to adopt. Many employers are now allowing their workforce to continue working remotely, which decreases the need for office space dramatically. I personally know of one multinational company based in Massachusetts with a branch in Orange County which is in the midst of moving to a smaller O.C. facility due to the number of staff members who wish to continue working from home. Another consideration is that all cities need tax revenue to operate, and office buildings do not generate the sales taxes and "bed taxes" that restaurants, retail shops and hotels generate.

I respectfully suggest that the Village plan be expanded to include multiple hotels at various "price points" designed to appeal to different travel demographics. For example, the Village could include a luxury boutique hotel, an extended stay hotel, and a budget motel. The Village site is ideal for hospitality accommodations with its high visibility from the freeway and a profusion of restaurants and retail shops nearby.

Thank you for allowing me to offer my thoughts on the future of the Village at Laguna Hills.

Very truly yours,
Christine L. Morinello
[email protected]
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 336 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: No to the Village at Laguna Hills
From: Felicity Figueroa <[email protected]>
Sent: Friday, July 2, 2021 3:54 PM
To: Erica Pezold <[email protected]>; Dave Wheeler <[email protected]>; Janine Heft <[email protected]>; Bill Hunt <[email protected]>; Donald M. Sedgwick <[email protected]>; Cindy Sands <[email protected]>; Public Comments <[email protected]>; Melissa Au‐Yeung <MAu‐[email protected]>
Subject: No to the Village at Laguna Hills
City Council Laguna Hills City Council and Staff,
The City should oppose the project as proposed. Unless the developer eliminates the hotel component, improves the landscaping plan, and makes other changes to improve our quality of life, the project should be rejected. For example, the developer should protect any mature trees on site and use only native plants. This creates a harmonious ecosystem and promotes our area’s natural foliage. Please reject this project.

Thank you,
Felicity Figueroa
[email protected]
36 Blazing Star
Irvine, California 92604
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 337 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: Say no to the “Village”
From: Gail Fitzpatrick <[email protected]>
Sent: Monday, July 5, 2021 2:45 PM
To: Erica Pezold <[email protected]>; Dave Wheeler <[email protected]>; Janine Heft <[email protected]>; Bill Hunt <[email protected]>; Donald M. Sedgwick <[email protected]>; Cindy Sands <[email protected]>; Public Comments <[email protected]>; Melissa Au‐Yeung <MAu‐[email protected]>
Subject: Say no to the “Village”
City Council Laguna Hills City Council and Staff,
I urge the City to reject this project. Many changes should be made before it could be approved: the City should eliminate the proposed Hotel, require improved bicycle connectivity, require a higher percentage of affordable units, and a better landscaping plan.

Sincerely,
Gail Fitzpatrick
[email protected]
23301 Ridge Route Dr
Laguna Hills, California 92653
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 338 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: No Hotel at Village at Laguna Hills. Oppose this Massive Project From: Janelle Cranch <[email protected]>
Sent: Monday, July 5, 2021 1:48 PM
To: Erica Pezold <[email protected]>; Dave Wheeler <[email protected]>; Janine Heft <[email protected]>; Bill Hunt <[email protected]>; Donald M. Sedgwick <[email protected]>; Cindy Sands <[email protected]>; Public Comments <[email protected]>; Melissa Au‐Yeung <MAu‐[email protected]>
Subject: No Hotel at Village at Laguna Hills. Oppose this Massive Project City Council Laguna Hills City Council and Staff,
The City should oppose the project as proposed. Instead, we need the modifications to improve quality of life for Laguna Hills residents. For example, the City should reject the proposed hotel. Residents do not need the 100-150 room hotel. That land could be more affordable housing or open space.

Sincerely,
Janelle Cranch
[email protected]
22171 Caminito Petatlan
Laguna Hills, California 92653
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 339 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) 1 Jennifer Lee
Subject: FW: No to the Village at Laguna Hills
From: Scott Keach <[email protected]>
Sent: Saturday, July 3, 2021 6:51 AM
To: Erica Pezold <[email protected]>; Dave Wheeler <[email protected]>; Janine Heft <[email protected]>; Bill Hunt <[email protected]>; Donald M. Sedgwick <[email protected]>; Cindy Sands <[email protected]>; Public Comments <[email protected]>; Melissa Au‐Yeung <MAu‐[email protected]>
Subject: No to the Village at Laguna Hills
City Council Laguna Hills City Council and Staff,
The City should oppose the project as proposed. Unless the developer eliminates the hotel component, improves the landscaping plan, and makes other changes to improve our quality of life, the project should be rejected. For example, the developer should protect any mature trees on site and use only native plants. This creates a harmonious ecosystem and promotes our area’s natural foliage. Please reject this project.

Thank you,
Scott Keach
[email protected]
25591 Indian Hill Lane
Laguna Hills, California 92653
[[[External E‐mail]]]
ATTENTION: THIS EMAIL ORIGINATED FROM OUTSIDE THE CITY OF LAGUNA HILLS. USE CAUTION WHEN OPENING ATTACHMENTS OR LINKS.
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Packet Pg. 340 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) July 6, 2021
Dear Mayor and Members of the City Council,
I want to propose a compromise plan for the Village at Laguna Hills. By rearranging only 15% of the site plan, the City can accomplish the following goals without changing the total amount of development the developer has proposed yet provides for future retail expansion and a park.

VILLAGE AT LAGUNA HILLS – RETAIL AND PARK EXPANSION PLAN A) PROPOSED GOALS:
• Provide more land for future retail expansion
• Increase retail parking
• Provide a new recreational park
• Provide more meeting space and 150 rooms in the hotel • Add Class 1 bicycle path on Calle de los Caballeros through the site B) RETAIL AND PARK EXPANSION PLAN DESCRIPTION:

The Retail and Park Expansion Plan maintains the existing square footage and intensities for the project including the 1,500 residential units, 250,000 SF of retail & 465,000 SF of office space but rearranges the office site plan (less than 15% of the site) to achieve the above goals.

Moving the surface parking from the office/residential sector to the retail sector will allow the expansion area to provide more future retail space and reduce the likelihood it would be come residential or office uses. This would give the City more control of its ultimate use and encourage expansion of the retail as the retail market evolves. The plan does the following:
1) CONSOLIDATE OFFICE INTO TWO BLOCKS: Consolidate office buildings & parking into two southern blocks. Office buildings floorplans remain the same – the north building relocates to south block and the two parking structures are built to provide 100% of the office parking.
2) RETAIL LAND & PARKING EXPANSION: Increase retail land by 25% (4+ acres) providing approximately 250 additional parking spaces for retail use using the north office block. 3) FUTURE RETAIL EXPANSION: Provide future pad for 50,000 SF of future retail or a second hotel on the 4-acre retail land expansion (20% increase in total retail SF). 4) VILLAGE GREEN PARK Add 1-acre Village Green recreational park with grass field for recreation on the NEC of Calle de los Caballeros and Calle Zocalo which is adjacent to the residential area plus is convenient for all the residents of the UVSP. 5) HOTEL CONFERENCE SPACE: Move 9,000 SF of the 10,805 SF of retail planned on the hotel ground floor to a new building so the hotel can devote this 9,000 SF of space to conference facilities while maintaining the 150 rooms. There would be no change to the hotel footprint, just removing most of the shops and replacing it with meeting space. 6) NEW RETAIL BUIDLING: A new retail building is added in the Village Park (same floor plan) to take 9,000 SF of the retail located in the hotel and move it next to the theater escalators (it will also hide the back of the big box retail). There is no net increase in n
Packet Pg. 341 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) retail – just moving it around on the site plan from the hotel to the theater area (also it moves the smelly dog park from the theater entrance).
7) CLASS 1 BICYCLE LANE: The proposed 6’ sidewalk on the south side of Calle de los Caballeros could be expanded to 10’ wide to provide a Class 1 bicycle path connecting Avenida de la Carlota to Paseo de Valencia and the transit center with a 4’ parkway separating the bikeway from the street and parking (to avoid doors opening into bikes).

C) ENVIRONMENTAL:

Since the retail, office and residential square footages and hotels rooms are the same as what was analyzed there would no changes to the environmental impacts and the current documentation can be used without any major changes for the approval process. The minor changes to the site plan could be accomplished by updating the Development Agreement and adding the compromise site plan and related conditions to the Conditions of Approval. At such time in the future that the developer wants to add additional 50,000 SF of retail space, a new environmental review and approval by the Planning Commission would be required.

D) RETAIL EXPANSION:

The Retail and Park Expansion Plan provides a better balance of land uses with about 40% of the site land area containing retail uses and retail uses under residential which is a significant increase from the current plan. The extra 4 acres of land devoted to retail uses increase the exclusive retail land by 25% and will provide area for the potential for future expansion of retail by 20% (50,000 SF). Providing 250 more surface parking spaces will increase the success of the retail and make it easier for residents to patronize the retailers.

Part of the new parking along the freeway could be used for community events such as Pumpkin City which allows the retail and restaurants to feed off this special event. Calle de la Magdalena could be closed between the Village and Recreation Parks for the weekly Farmers market allowing the retailers to capitalize on the foot traffic from the Farmers Market.

E) FISCAL IMPACTS:
1) PROVIDES FUTURE SOURCE OF REVENUE: The compromise project will provide the same benefits as the current fiscal analysis but also provides additional potential future revenue sources by adding meeting space to the hotel which could increase ADR and occupancy and providing a future expansion of retail square footage (or even a second hotel site). 2) MAINTENANCE DISTRICT: I would suggest that either a Landscape and Lighting District (LLD) or a Community Facilities District (CFD) be set up that is funded through fees added to the property tax bill of the 68 acres that would maintain the all of the public streets within the UVSP bounded by Avenida de la Carlota, Los Alisos and Paseo de la Valencia. This would provide ongoing revenue for the City to offset costs that are currently coming out of the general fund. The maintenance district would include the following items:
n
Packet Pg. 342 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) • Median and parkway landscaping
• Street lighting
• Monument and directional signage
• Traffic signal maintenance
• Holiday lighting and decorations
• Maintenance, utilities, and real estate operations of the police substation 3) PUBLIC BENEFITS PAYMENT – I would add an additional public benefits payment for money for the following which improve the quality of life for the City and provide better access to the project for the developer:
i) El Toro/I 5 intersection improvements: Payment for designing a Laguna Hills based solution to the El Toro/5 Freeway interchange to improve traffic flow on El Toro. ii) Traffic Signal Synchronization: Traffic signal synchronization project to improve traffic flows in the City of Laguna Hills & Laguna Woods bounded by Lake Forest Drive on the north, 5 freeway on the east, 73 Toll Road on the west and Alicia Parkway on the south iii) Deferred Road Maintenance – Road repairs on roads that serve the project within the area boarded by Alicia, 5 Freeway, Lake Forest and 73 toll road.

F) ARCHITECTURE: The architectural design of the project does not meet the standards outlined in the UVSP. The project design should be changed to eliminate materials such as:
board form concrete, metal wall panels, metal roofing, perforated metal panels, concrete panels. The Laguna Hills City Hall, Ashley Furniture complex and Oakbrook Village all followed the recommended architectural styles in the UVSP. As the centerpiece of the UVSP, The Village at Laguna Hills should incorporate the architectural styles discussed in the UVSP. If they do not want to follow the UVSP and use the NorCal style they have proposed then they need to propose an amendment to the UVSP Zoning Code and allow the City Council to debate the merits of the amendment to the Zoning Code prior to gaining approval on the project.

CONCLUSION:

This Retail and Park Expansion Plan provides the developer with the intensity of uses they proposed but answers many of the concerns raised by the public and City council including providing more open space, more space for retail, more parking and more conference space for the hotel. Increasing the retail land by 25% will provide more land for future expansion of retail square footage at a later time. I believe that providing the new Recreation Park will expand recreational opportunities for all the residents in the UVSP which currently do not have a park.

I hope you will consider the Retail and Park Expansion Plan to get this project approved with a project the City will be proud of and will provide positive fiscal impacts for the city.

Sincerely,
Carl Christiansen
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Packet Pg. 343 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) n
Packet Pg. 344 Attachment: Attachment n - Comment Letters Received After 3PM June 29, 2021 (2767 : Village at Laguna Hills Continued Public Hearing)

SUMMARY OF FINDINGS
Proposed Laguna Hills Hotel

LAGUNA HILLS MALL, CALLE DE LA LOUISA

LAGUNA HILLS, CALIFORNIA
SUBMITTED TO:PR OPOSED
Stephen T. Logan
Merlone Geier Partners
4365 Executive Drive, Suite 1400
San Diego, California 92121
PREPARED BY:

HVS Consulting & Valuation
Division of TS Worldwide, LLC
8430 Santa Monica Boulevard, Suite 200
West Hollywood, California 90069
+1 (310) 270-3240
December-2021
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Packet Pg. 345 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December 13, 2021
Stephen T. Logan
Merlone Geier Partners
4365 Executive Drive, Suite 1400
San Diego, California 92121
Re: Proposed Laguna Hills Hotel
Laguna Hills, California
HVS Reference: 2021022179
Dear Mr. Logan:

Pursuant to your request, we herewith submit our summary of findings pertaining to the above-captioned property. We have inspected the real estate and analyzed the hotel market conditions in the Laguna Hills, California, area. We have studied the proposed project, and the summary results of our fieldwork and analysis are presented in this document.

The purpose of this study is to analyze and test the feasibility of two different scenarios for a proposed hotel in Laguna Hills. The first scenario explores the feasibility of a nationally branded “upscale” hotel, as categorized by Smith Travel Research (STR) Chain Scales. Chain scale segments are grouped primarily according to actual average room rates nationwide. Upscale hotels are typically select-service or full-service in nature. For the purpose of our first analysis we have assumed a select-service hotel. Select-service hotels offer F&B (e.g., a lobby bar and restaurant which may have a more limited menu or operating hours) and meeting facilities, but these are still limited when compared to full-service hotels.

The second purpose of this study was to evaluate the feasibility of a higher caliber hotel (above the upscale chain scale segment). As such, the second scenario analyzes the potential feasibility of a nationally branded upper-upscale hotel as categorized by STR. Upper-upscale hotels are typically full-service in nature with an F&B offering that typically comprises one or more full-service restaurants (typically with more expansive food and beverage offerings, operational hours, and in-room dining) as well as expanded meeting facilities in order to better cater to groups and events. Given the subsequent results of the upper-upscale fullservice analysis, we did not test the feasibility of a hotel of higher caliber than the upper-upscale segment.

Our findings for both scenarios are further described in the subsequent chapters of this report.

FEASIBILITY SUMMARY
Upscale Scenario Upper Upscale Scenario
Net Present Val ue (NPV) $41,500,000 $47,300,000
Estima ted Repla cement Cost $40,900,000 $55,700,000
Difference Between NPV
and Repl acement Cost 1.5% -15.1%
Feasibili ty Concl usion Feasible Not Feasible
Based on our analysis, which is further outlined in this report, there is sufficient support for an upscale, select-service hotel, while there is insufficient support for the upper upscale, full-service scenario. The difference between the Net Present Value (NPV), which is the anticipated value of the property upon completion, and the estimated Replacement Cost is a key indicator of the feasibility of a project.

Investors expect to create additional value following the completion of a hotel; if the NPV is below the cost to construct the property, there is generally limited incentive to pursue the project. Given that the NPV for the upper upscale scenario is significantly below the estimated replacement cost, it is unlikely the project would be feasible in the next five to ten years based on the current scope and market performance.

We hereby certify that we have no undisclosed interest in the property, and our employment and compensation are not contingent upon our findings. This study is subject to the comments made throughout this report and to all assumptions and limiting conditions set forth herein.

Sincerely,
TS Worldwide, LLC
Luigi Major, MAI, Managing Director
[email protected], +1 (310) 270-3240
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Packet Pg. 347 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) Table of Contents

SECTION TITLE PAGE

1. Subject of The Study 1
Subject of the Study 1
Ownership, Franchise, and Management Assumptions 4

2. Overview of Local Area Economy 5
Overview of Local Area Economy 5
Overview of Local Area Lodging Market Trends 9

3. Upscale Analysis 18
Forecast of the Proposed Subject Hotel’s Occupancy 18
Forecast of the Proposed Subject Hotel’s Average Rate 20 Forecast of Income and Expense 21
Feasibility Analysis 27

4. Upper-Upscale Analysis 30
Forecast of the Proposed Subject Hotel’s Occupancy 30
Forecast of the Proposed Subject Hotel’s Average Rate 32 Forecast of Income and Expense 33
Feasibility Analysis 39

5. Method of Study & Statement of Assumptions and Limiting Conditions42 Method of Study 42
Addenda
Qualifications
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Packet Pg. 348 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Subject of The Study
Proposed Laguna Hills Hotel – Laguna Hills, California 1

1. Subject of The Study
The subject of the study is an approximately 95,832-square-foot (2.20-acre) parcel to be improved with a either an upscale select-service lodging facility or an upper upscale full-service hotel; the hotel is expected to be associated with a national upscale, select-service or upper upscale full-service hotel brand. The proposed subject property, which is expected to open on June 1, 20231, will feature 150 rooms. The upscale scenario is expected to feature a lobby restaurant and bar, a fitness room, a lobby workstation or small business center, and leased groundfloor retail; the upper upscale scenario is expected to feature a restaurant and a café, a fitness center, a business center, a gift shop, and leased ground-floor retail The hotel will also contain the appropriate parking capacity and all necessary back-of-the-house space.
1 The proposed opening date is for analysis purposes only, and does not account for the time necessary to obtain local implementing approvals (e.g., final map approval, a building permit or a certificate of occupancy) required to construct and then open the hotel.

Subject of the
Study
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Packet Pg. 349 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Subject of The Study
Proposed Laguna Hills Hotel – Laguna Hills, California 2 FIGURE 1-1 SUMMARY OF PLANNED FACILITIES (UPSCALE)
Anticipated Guestroom Configuration
King 75
Queen/Queen 60
Suites 15
Total 150
Anticipated Food & Beverage Facilities
Lobby Restaurant & Bar 100–150
Anticipated Indoor Meeting & Banquet Facilities
Meeting Room(s) TBD by brand
Anticipated Amenities & Services
Fitness Room
Lobby Workstation or Business Center
Ground-Floor Retail (Leased)
Square Footage
Estimated Number of Units
Estimated Seating Capacity
FIGURE 1-2 SUMMARY OF PLANNED FACILITIES (UPPER UPSCALE) Anticipated Guestroom Configuration
King 75
Queen/Queen 60
Suites 15
Total 150
Anticipated Food & Beverage Facilities
Restaurant & Bar 200–250
Café 25–50
Anticipated Indoor Meeting & Banquet Facilities
Ballroom TBD by brand
Meeting Room(s) TBD by brand
Anticipated Amenities & Services
Fitness Center Concierge
Business Center Room Service
Ground-Floor Retail (Leased) Gift Shop/Boutique
Estimated Number of Units
Estimated Seating Capacity
Square Footage
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Packet Pg. 350 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Subject of The Study
Proposed Laguna Hills Hotel – Laguna Hills, California 3 The subject site’s location is the Laguna Hills Mall, Calle de la Louisa, Laguna Hills, California 92653.

LOCATION MAP

VIEW OF SUBJECT SITE
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Packet Pg. 351 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Subject of The Study
Proposed Laguna Hills Hotel – Laguna Hills, California 4 We assume that all utilities will be available to the site and that no hazards are present that will impede its development. We assume that the certificate of occupancy will be issued on or before the opening date for the entirety of the improvements.

The subject site was last sold in 2013. Merlone Geier Partners has owned the site since that time, having purchased it from Simon Property Group for an undisclosed price. At the time of purchase, the site encompassed an indoor shopping mall; the mall was permanently shuttered in late 2018, and most of the original structure has since been demolished. The greater 68-acre tract is expected to be divided into smaller parcels as part of the Village at Laguna Hills mixed-use development; the proposed subject hotel will be a part of this development. No transfers of the property have reportedly occurred since 2013.

Details pertaining to management terms were not yet determined at the time of this report; however, we assume that the proposed hotel will be managed by a professional hotel-operating company, with fees deducted at rates consistent with current market standards. Our projections reflect a management fee of 3.0% of total revenues in our study.

While a specific franchise has not been selected at the time of this report, we assume that the proposed subject hotel will operate as either an upscale, selectservice or an upper upscale, full-service lodging facility. Our projections reflect the associated fees for each scenario. We have positioned the proposed hotel's projected franchise fees based on our review of several hotel brand's current franchise fees. Based on our review of national hotel brand franchise terms and fees are outlined in the table below. Reservations fees will also be due and are included in the rooms expense line item of our forecast.

FIGURE 1-3 FRANCHISE FEES
Royalty Fee (%
of Rooms
Revenue)
Marketing Fee (%
of Rooms
Revenue)
Upscale Scenario 5.50% 3.15%
Upper Upscale Scenario 5.50% 4.00%
Ownership, Franchise,
and Management
Assumptions
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Proposed Laguna Hills Hotel – Laguna Hills, California 5

2. Overview of Local Area Economy
Orange County comprises 34 incorporated cities with 42 miles of coastline. Orange County adjoins the greater Los Angeles area to the north and has been a direct beneficiary of the aggressive economic growth of the Los Angeles Basin. As the Los Angeles economy expanded in the 1980s, Orange County evolved into a selfsufficient, diverse urban center with mature industrial, commercial, and residential markets. It is known for its sunny beaches, including Laguna Beach, as well as Disneyland and Knott’s Berry Farm. Its population was estimated by the U.S. Census to be nearly 3.2 million people in 2018. Orange County has a diverse economic base, with Santa Ana serving as the government seat of the county, Irvine as the financial center, and Anaheim/Garden Grove as the major tourism destination. The city of Laguna Hills, which was incorporated in 1991, along with nearby Lake Forest and Foothill Ranch, has become a hub for several corporate headquarters and offices including Marie Callender's, Panasonic, Oakley, Saddleback College, Loan Depot, Cox Communications, and Kawasaki. This area is also home to several hiking trails and lakes, which draw outdoor enthusiasts to the region.

Locally, the unemployment rate was 7.5% in 2020; for this same area in 2021, the most recent month’s unemployment rate was registered at 4.2%, versus 7.8% for the same month in 2020.

The following bullet points highlight major demand generators for this market:
· The University of California - Irvine (UC Irvine) is the second-largest employer in Orange County. UC Irvine, whose name originated from the Irvine Company, was founded in 1965 as a public, co-educational research university. UC Irvine offers 68 undergraduate degree programs, 53 minors, 45 master’s degree programs, and 43 doctoral programs. In 2010, UC Irvine opened the 100,000- square-foot Sue and Bill Gross Hall, the first stem-cell research center in Southern California. The facility is equipped with Orange County’s only Level I trauma center and regional burn center, as well as a 45-bed neonatal intensive-care unit. Phase II of this hospital opened in early 2012. The project was touted to be the largest construction project in Orange County's history, at a total cost of $556 million. In 2016, the $92-million expansion of the Mesa Court student-housing complex opened, housing over 800 students. We note that classes and facilities were shut down beginning in March 2020 due to the Overview of Local Area
Economy
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Proposed Laguna Hills Hotel – Laguna Hills, California 6 onset of the COVID-19 pandemic. Students were limited to remote learning, with few exceptions, in the 2020–21 academic year; however, students returned to in-person learning for the Fall 2021 semester. · Companies representing the technology and automotive sectors have a large presence in Irvine, Lake Forest, Foothill Ranch, and Mission Viejo. Broadcom Corp. is one of the world's largest semiconductor companies and the largest technology company in Irvine; a new, 70-acre, 1.1-million-square-foot campus in Irvine's Great Park neighborhood was completed in 2018. Toshiba America Electronic Components Inc. is an independent operating company owned by Toshiba America Inc., a subsidiary of Toshiba Corporation, which employs approximately 8,000 people in the United States. Toshiba America Electronic Components Inc.'s headquarters are in Irvine, and the company continues to grow in the field of research and development. Quality Systems Inc.'s (QSI) national headquarters are also in Irvine; QSI and its NextGen Healthcare subsidiary provide prepackaged software for healthcare companies looking to digitize their medical records and connectivity services. Although numerous layoffs and furloughs were announced in March and April of 2020, many furloughs ended later in 2020, and many companies are now hiring. Many corporate entities are still encouraging remote working, or a combination of office and remote work. Laguna Hills and the surrounding communities benefit from the breadth of corporate demand generators in Irvine, considered Orange County's financial and technology center.
· MemorialCare Saddleback Medical Center is a major general medical and surgical hospital in Laguna Hills. The hospital is consistently ranked among the Top 100 hospitals in the United States by U.S. News & World Report across a variety of specialties. The hospital is major employer in the area, employing over 1,000 physicians, nurses, and administrative staff. In 2019, the Neuroscience Institute at Saddleback Medical Center was expanded, allowing the hospital to rank among the first three U.S. hospitals to receive Joint Commission Certification as an Advanced Thrombectomy-Capable Stroke Center in the United States. The recognition has made the area a destination for stroke treatment in Orange County and Southern California.

The greater Irvine area, inclusive of Laguna Hills, remains one of the desirable commercial centers in Orange County. The economic base is diverse in this market, with strong employers in the technology, consumer goods, healthcare, and financial sectors. Moreover, the former El Toro Marine Corps Air Station continues to be transformed into an urban park area known as Orange County Great Park, with facilities that include a waterpark, sports park, botanical gardens, and several arts and cultural centers. We also note that land prices have significantly increased in the past several years, but this has not deterred the development of mixed-use projects in the area. Finally, the defunct Laguna Hills Mall is being redeveloped o
Packet Pg. 354 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Overview of Local Area Economy
Proposed Laguna Hills Hotel – Laguna Hills, California 7 into a mixed-use development that will encompass 68 acres and include 250,000 square feet of retail, 465,000 square feet of office space, a hotel, and approximately 1,500 multi-family and townhome residential units. Although the COVID-19 pandemic continues to affect the local and regional economy to some degree, the lifting of most pandemic-related restrictions, coupled with the wide distribution of vaccinations, has aided in a recovery.

This area is served by John Wayne Airport, Long Beach International Airport, and the Los Angeles International Airport.

FIGURE 2-4 AIRPORT STATISTICS
Year
2011 8,609,008 — 3,115,433 — 61,862,052 —
2012 8,857,944 2.9 % 3,205,907 2.9 % 63,688,121 3.0 %
2013 9,232,789 4.2 2,942,873 (8.2) 66,665,726 4.7
2014 9,386,033 1.7 2,823,996 (4.0) 70,662,212 6.0
2015 10,038,466 7.0 2,523,686 (10.6) 74,956,305 6.1
2016 10,496,511 4.6 2,841,144 12.6 80,921,527 8.0
2017 10,423,578 (0.7) 3,783,775 33.2 84,558,776 4.5
2018 10,664,038 2.3 3,884,857 2.7 87,533,177 3.5
2019 10,656,986 (0.1) 3,584,203 (7.7) 88,068,013 0.6
2020 3,794,850 (64.4) 1,043,773 (70.9) 28,779,527 (67.3) Year-to-date, Aug
2020 2,704,119 — 827,903 — 22,676,679 —
2021 4,341,266 60.5 % 1,191,244 43.9 % 33,036,486 45.7 % Traffic Change Traffic Change Traffic Change
Sources: Respective Ai rport Authorities
John Wayne Airport Long Beach Airport Los Angeles International Airport Passenger Percent Passenger Percent Passenger Percent
Although the greater Irvine area itself offers limited tourist attractions, nearby cities such as Costa Mesa, Newport Beach, Laguna Beach, and Anaheim feature a variety of tourist and leisure attractions. The peak season for tourism in this area is typically from May to September. During other times of the year, weekend demand usually comprises travelers passing through en route to other destinations, people visiting friends or relatives, and other similar weekend demand generators. Primary attractions in the area include the following:
· The Irvine Spectrum Center is an outdoor shopping center featuring over 100 shops, the 21-screen Edwards movie theatre, and the 500-seat Irvine Improve Theatre. The shopping center also offers the "Giant Wheel," a Ferris wheel that projects lighting schemes via 52,000 LED lights, visible by passing motorists on o
Packet Pg. 355 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Overview of Local Area Economy
Proposed Laguna Hills Hotel – Laguna Hills, California 8 Interstate 5; other attractions include a carousal and a children's train. The nearby South Coast Plaza is also a major shopping attraction for residents and visitors, alike. We note that many of the shopping outlets and attractions at the Irvine Spectrum Center closed in March 2020 with the onset of the COVID-19 pandemic. However, most retail outlets and attractions have since reopened now that most pandemic-related restrictions have been rescinded. · The Orange County Great Park is a non-aviation reuse of the defunct El Toro Marine Corps Air Station, encompassing over 450 acres, with plans to develop the park to over 1,300 acres. The park currently includes attractions such as the Great Park Balloon, the Great Park Ice Arena, a variety of sports fields, the Palm Court Arts Complex, a Farmer's Market, multiple miles of hiking trails, and a 2,500-seat soccer stadium, which is home to Orange County SC. Future planned projects include a 19-acre outdoor waterpark, slated to open in the summer 2022; a 10,000-seat amphitheater; an aviation museum; and multiple retail and dining outlets. The entire planned development includes a breadth of attractions, which should become a major tourism destination for the region over the coming years. We note that many of the existing attractions closed in March 2020 given the onset of the COVID-19 pandemic. However, most of these attractions have reopened, some with limited capacities per any applicable governmental restrictions.
· Orange County is home to a variety of coastal beaches and towns, which typically receive visitors from around the world. Popular destinations include Laguna Beach, Newport Beach, and Huntington Beach; the beaches are a major attraction for surfers, while Laguna Beach also has tide pools and the oceanfront Crystal Cove State Park. Moreover, the Pacific Coast Highway (State Highway 1), which follows the California coastline, is a famous attraction, with visitors beginning at one end and traveling the route along the coast to see the renowned vistas. The southernmost end of the highway begins at Dana Point, which is just south of the Lake Forest and Laguna Hills area. As a popular starting point for the journey, communities in the area benefit from travelers staying here before they begin the trip.

Prior to the onset of the COVID-19 pandemic and the corresponding economic crisis, the greater Irvine area, which includes Laguna Hills, was experiencing a period of economic strength and expansion, primarily led by the technology and finance industries and the healthcare sector. However, the COVID-19 pandemic continues to affect the local market to a moderate degree, resulting in decreased business activity, inclusive of the hospitality industry. Nevertheless, the wide distribution of vaccinations and the lifting of many pandemic-related restrictions has sparked a recovery in the second half of 2021; thus, while the near-term o
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Proposed Laguna Hills Hotel – Laguna Hills, California 9 outlook for the market is best described as one of caution at this time, the longterm outlook is more optimistic.

The subject site is located in the greater Orange County lodging market, which encompasses over 200 open and operating lodging facilities totaling roughly 25,000 guestrooms. Within this greater market, the direct submarket that will include the subject hotel is known as Laguna Hills; competitive hotels are also located in Lake Forest, Irvine, and Mission Viejo. Within this market, the proposed subject hotel will compete with a smaller set of hotels based on various factors, such as price point, product offering, and amenities, among other factors.

STR is an independent research firm that compiles and publishes data on the lodging industry, and this information is routinely used by typical hotel buyers.

HVS has ordered and analyzed an STR Trend Report of historical supply and demand data for this competitive set.

Overview of Local Area
Lodging Market Trends
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Proposed Laguna Hills Hotel – Laguna Hills, California 10 FIGURE 2-5 HISTORICAL SUPPLY AND DEMAND TRENDS (STR)
Year
Average Daily
Room Count
Available
Room Nights Change
Occupied
Room Nights Change Occupancy
Average
Rate Change RevPAR Change
2011 1,304 475,960 — 345,566 — 72.6 % $118.69 — $86.17 — 2012 1,304 476,113 0.0 % 337,857 (2.2) % 71.0 125.09 5.4 % 88.77 3.0 % 2013 1,304 475,960 (0.0) 350,842 3.8 73.7 132.08 5.6 97.36 9.7 2014 1,410 514,600 8.1 394,816 12.5 76.7 139.20 5.4 106.79 9.7 2015 1,514 552,610 7.4 435,126 10.2 78.7 151.06 8.5 118.94 11.4 2016 1,632 595,696 7.8 462,779 6.4 77.7 155.62 3.0 120.90 1.6 2017 1,666 608,096 2.1 481,828 4.1 79.2 158.54 1.9 125.62 3.9 2018 1,914 698,610 14.9 530,126 10.0 75.9 167.89 5.9 127.40 1.4 2019 1,914 698,610 0.0 535,038 0.9 76.6 171.03 1.9 130.98 2.8 2020 2,062 752,668 7.7 302,387 (43.5) 40.2 132.26 (22.7) 53.13 (59.4) Year-to-Date Through September
2020 2,004 547,140 — 220,547 — 40.3 % $140.38 — $56.58 — 2021 2,314 631,710 15.5 % 366,687 66.3 % 58.0 146.95 4.7 % 85.30 50.8 % Average Annual Compounded Change:
2011 – 2019 4.9 % 5.6 % 4.7 % 5.4 %
2011 – 2020 5.2 (1.5) 1.2 (5.2)
2016 – 2019 5.5 % 5.0 % 3.2 % 2.7 %
Competitive
Hotels Included in Sample Class Status
Ascend Collection The Hi lls Hotel Upscale Class Secondary 148 Jun 2020 Jan 1977 Fairfield Inn Mission Viejo Orange County Upper Midscale Class Primary 146 Dec 1992 May 1987 Residence Inn Irvine Spectrum Upscale Class Primary 112 May 1989 May 1989 Sonesta Select Laguna Hills Irvine Spectrum Orange County Upscale Class Primary 136 Feb 2021 Jul 1990 DoubleTree by Hilton Hotel Irvine Spectrum Upscale Class Secondary 252 Jul 1999 Jul 1999 Holiday Inn Express & Suites Lake Forest - Irvine East Upper Midscale Class Primary 60 May 2019 Oct 2002 Staybridge Suites Irvine East/Lake Forest Upscale Class Primary 128 Mar 2006 Mar 2006 Renaissance ClubSport Aliso Viejo Laguna Beach Hotel Upper Upscale Class Secondary 174 Jun 2020 Jul 2008 Hilton Garden Inn Irvine Spectrum Lake Forest Upscale Class Primary 148 Oct 2019 Sep 2009 Courtyard Irvine Spectrum Upscale Class Primary 210 Jul 2014 Jul 2014 Homewood Suites by Hil ton Aliso Viejo Laguna Beach Upscale Class Secondary 129 Feb 2016 Feb 2016 Marriott Irvine Spectrum Upper Upscale Class Secondary 271 Dec 2017 Dec 2017 Hampton by Hilton Inn Irvine Spectrum Lake Forest Upper Midscale Class Primary 92 Jun 2020 Jun 2020 Homewood Suites by Hil ton Irvine Spectrum Lake Forest Upscale Class Primary 116 Jun 2020 Jun 2020 TownePlace Suites Irvine Lake Forest Upper Midscale Class Primary 112 Jun 2020 Jun 2020 SpringHill Suites Irvine Lake Forest Upscale Class Primary 102 Mar 2021 Mar 2021 Total 2,336
Year
Opened
Year
Affiliated
Source: STR
Number
of Rooms
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-2021 Overview of Local Area Economy
Proposed Laguna Hills Hotel– Laguna Hills, California 11

MAP OF COMPETITION
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Packet Pg. 359 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Overview of Local Area Economy
Proposed Laguna Hills Hotel – Laguna Hills, California 12 During the illustrated historical period, both occupancy and ADR generally followed a strengthening trend. A number of new hotels began to open within the market in 2014, a trend that continued through 2018, during which available room nights increased by 46%. Continued corporate expansions and developments in the Irvine and Lake Forest areas boosted demand levels, allowing the market to absorb the new supply until 2018, at which time available room nights increased by 15%; thus, occupancy contracted notably. However, ADR increased year-overyear during the same period. In 2016, occupancy declined moderately and ADR growth slowed following layoffs at Oakley. Corporate expansions and increased leisure demand aided in the growth over the past decade. In March 2020, the COVID-19 pandemic began to affect the local market, similar to the rest of the nation, resulting in decreased business activity, inclusive of the hospitality, tourism, and manufacturing industries; thus, all performance metrics declined significantly in 2020. Year-to-date 2021 data illustrate a notable improvement in occupancy and a roughly $6 gain in ADR. The most recent performance metrics can be attributed to increased business activity and heightened leisure travel given the improving conditions. While the pandemic will continue to affect business to some degree in the near term, the overall outlook is optimistic given the dynamics of this market, the successful rollout of vaccines, the removal of many COVID-related restrictions, and the recent increase in travel.

The following table illustrates the historical occupancy and average rate (ADR) levels for selected hotels in the market.
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Proposed Laguna Hills Hotel – Laguna Hills, California 13 FIGURE 2-6 PRIMARY COMPETITORS – OPERATING PERFORMANCE
Est. Segmentation Estimated 2018 Estimated 2019
Property Occ. RevPAR RevPAR
Occupancy
Penetration
Yield
Penetration
Residence Inn by Marriott Irvine Spectrum 112 70 % 20 % 10 % 112 60 - 65 % $170 - $180 $105 - $110 112 75 - 80 % $170 - $180 $140 - $150 100 - 110 % 100 - 110 % Courtyard by Marriott Irvine Spectrum 210 75 15 10 210 80 - 85 190 - 200 150 - 160 210 80 - 85 190 - 200 150 - 160 100 - 110 120 - 130 Hilton Garden Inn Lake Forest Irvine Spectrum 148 75 15 10 148 70 - 75 160 - 170 120 - 125 148 50 - 55 150 - 160 85 - 90 70 - 75 60 - 65 Sonesta Select Laguna Hills Irvine Spectrum 136 70 15 15 136 70 - 75 150 - 160 110 - 115 136 70 - 75 140 - 150 105 - 110 95 - 100 80 - 85 TownePlace Suites by Marriott Irvine La ke Forest 112 70 20 10 Staybridge Suites Irvine East Lake Fores t 128 75 10 15 128 80 - 85 160 - 170 130 - 140 128 80 - 85 160 - 170 130 - 140 100 - 110 100 - 110 Hampton Inn Irvine Spectrum Lake Forest 92 70 15 15
Homewood Suites by Hilton Irvine Spectrum Lake
Forest
116 70 15 15
Sub-Totals/Averages 1,054 73 % 15 % 12 % 734 76.3 % $170.48 $130.00 734 74.9 % $169.33 $127 98 % 96.8 % Secondary Competitors 1,180 56 % 25 % 19 % 903 75.6 % $165.76 $125.27 903 78.0 % $172.38 $134 102 % 102.6 % Totals/Averages 2,234 64 % 21 % 16 % 1,637 75.9 % $167.89 $127.39 1,637 76.6 % $171.04 $131 100 % 100.0 % * Specific occupancy and average rate data were utilized in our analysis, but are presented in ranges in the above table for the purposes of confidentiality.

Commercial
Leisure
Group
Average Rate
Weighted
Annual
Room
Count
Number of
Rooms Average Rate Occ.

Weighted
Annual
Room
Count
HOTEL OPENED IN 2020
HOTEL OPENED IN 2020
HOTEL OPENED IN 2020
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Proposed Laguna Hills Hotel – Laguna Hills, California 14 FIGURE 2-7 SECONDARY COMPETITORS – OPERATING PERFORMANCE Est. Segmentation Estimated 2018 Estimated 2019
Property
Number of
Rooms Occ. Average Rate RevPAR Occ. Average Rate RevPAR Holiday Inn Express & Suites Lake Fores t 146 65 % 20 % 15 % 85 % 124 70 - 75 % $120 - $125 $90 - $95 124 70 - 75 % $125 - $130 $90 - $95 Fairfield by Marriott Mission Viejo Orange
County
60 65 20 15 85 51 75 - 80 120 - 125 90 - 95 51 70 - 75 120 - 125 90 - 95 Homewood Suites by Hilton Aliso Viejo Laguna
Beach 129 65 20 15 80 103 80 - 85 160 - 170 130 - 140 103 80 - 85 160 - 170 125 - 130 Hills Hotel an As cend Collection Hotel 148 45 30 25 75 111 70 - 75 125 - 130 85 - 90 111 65 - 70 125 - 130 85 - 90 DoubleTree by Hilton Irvine Spectrum 252 60 25 15 75 189 75 - 80 160 - 170 125 - 130 189 80 - 85 180 - 190 150 - 160 Marriott Irvine Spectrum 271 50 25 25 75 203 70 - 75 210 - 220 150 - 160 203 80 - 85 210 - 220 180 - 190 Renaissance ClubSport Aliso Viejo 174 50 35 15 70 122 70 - 75 190 - 200 140 - 150 122 70 - 75 180 - 190 130 - 140 Totals/Averages 1,180 56 % 25 % 19 % 77 % 903 75.6 % $165.76 $125.27 903 78.0 % $172.38 $134.41 * Specific occupancy and average rate data was utilized in our analysis, but is presented in ranges in the above table for the purposes of confidentiality.

Commercial
Leisure
Group
Total
Competitive
Level
Weighted
Annual
Room
Count
Weighted
Annual
Room
Count
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Proposed Laguna Hills Hotel – Laguna Hills, California 15 Our survey of the primarily competitive hotels in the local market shows a range of lodging types and facilities. Each primary competitor was inspected and evaluated.

According to the City of Laguna Hills Planning Office, and our research and inspection (as applicable), new supply expected to be competitive within the proposed subject hotel's competitive submarket is outlined in the following table.

FIGURE 2-8 NEW SUPPLY
Total
Proposed Property
Number
of Rooms
Competitive
Level
Estimated Opening
Date Development Stage
Proposed Subject Property 150 100 % 150 June 1, 2023 Early Development Springhill Suites by Marriott Lake Forest 102 100 102 March 1, 2021 Recently Opened Totals/Averages 252 252
Weighted
Room Count
Market segmentation is a useful procedure because individual classifications often exhibit unique characteristics in terms of growth potential, seasonality of demand, average length of stay, double occupancy, facility requirements, price sensitivity, and so forth. By quantifying the room-night demand by market segment and analyzing the characteristics of each segment, the demand for transient accommodations can be projected.

FIGURE 2-9 ACCOMMODATED-ROOM-NIGHT DEMAND
Marketwide
Market Segment
Commercia l 291,401 64 %
Lei sure 94,805 21
Group 71,495 16
Total 457,701 100 %
Accommodated
Demand
Percentage
of Total
Various types of economic and demographic data were then evaluated to determine their propensity to reflect changes in hotel demand. Based on this procedure, we forecast the following average annual compounded marketsegment growth rates. o
Packet Pg. 363 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Overview of Local Area Economy
Proposed Laguna Hills Hotel – Laguna Hills, California 16 FIGURE 2-10 AVERAGE ANNUAL COMPOUNDED MARKET-SEGMENT GROWTH RATES Annual Growth Rate
Market Segment
Commercial -45.0 % 64.0 % 28.0 % 15.0 % 7.0 % 1.0 %
Leisure -33.0 75.0 10.0 6.0 3.0 1.0
Group -45.0 50.0 15.0 12.0 10.0 5.0
Base Demand Growth -42.5 % 64.6 % 21.6 % 12.5 % 6.5 % 1.5 % 2020 2021 2022 2023 2024 2025
The following table details our projection of lodging demand growth for the subject market, including the total number of occupied room nights and any residual unaccommodated demand in the market.
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Proposed Laguna Hills Hotel – Laguna Hills, California 17 FIGURE 2-11 FORECAST OF MARKET OCCUPANCY
291,401 160,271 262,844 336,440 386,906 413,989 418,129 418,129 Growth Rate (45.0) % 64.0 % 28.0 % 15.0 % 7.0 % 1.0 % 0.0 % 94,805 63,519 111,159 122,274 129,611 133,499 134,834 134,834 (33.0) % 75.0 % 10.0 % 6.0 % 3.0 % 1.0 % 0.0 %
71,495 39,322 58,984 67,831 75,971 83,568 87,746 87,746 (45.0) % 50.0 % 15.0 % 12.0 % 10.0 % 5.0 % 0.0 %
Base Demand 457,701 263,112 432,986 526,546 592,488 631,057 640,710 640,710 Total Dema nd 457,701 263,112 432,986 526,546 592,488 631,057 640,710 640,710 Overall Demand Growth 0.9 % (42.5) % 64.6 % 21.6 % 12.5 % 6.2 % 1.3 % 0.0 % Market Mix

63.7 % 60.9 % 60.7 % 63.9 % 65.3 % 65.6 % 65.3 % 65.3 %

20.7 24.1 25.7 23.2 21.9 21.2 21.0 21.0

15.6 14.9 13.6 12.9 12.8 13.2 13.7 13.7
1,637 1,796 1,957 1,957 1,957 1,957 1,957 1,957
Proposed Subject Property 188 150 150 150
Springhill Suites by Marriott Lake Forest 286 102 102 102 102 102 Ava ilable Room Nights per Yea r 597,633 655,566 745,645 751,663 783,763 806,413 806,413 806,413 Nights per Yea r 365 365 365 365 365 365 365 365
Total Supply 1,637 1,796 2,043 2,059 2,147 2,209 2,209 2,209 Rooms Supply Growth 0.0 % 9.7 % 13.7 % 0.8 % 4.3 % 2.9 % 0.0 % 0.0 % Marketwide Occupancy 76.6 % 40.1 % 58.1 % 70.1 % 75.6 % 78.0 % 79.0 % 79.0 % 1 Opening in June 2023 of the 100% competitive, 150-room Proposed Subject Property 2 Opening in Ma rch 2021 of the 100% competitive, 102-room Springhill Suites by Ma rriott La ke Forest Commercial
2019 2020 2021 2022 2023 2024 2025 2026
Total Dema nd
Leisure
Total Dema nd
Growth Rate
Group
Total Dema nd
Growth Rate
Group
Existing Hotel Supply
Proposed Hotels
Totals
Commercial
Leisure
These room-night projections for the market area are used in determining the proposed subject hotel’s expected occupancy levels based on penetration levels forecast by segment.
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Proposed Laguna Hills Hotel – Laguna Hills, California 18

3. Upscale Analysis
In the first scenario, the proposed subject hotel is expected to be operated as an upscale, select-service lodging facility, to be affiliated with a national brand. Some brands that fall under this category include Aloft Hotels, AC Hotel by Marriott, Courtyard by Marriott, and Hilton Garden Inn. These hotels typically include a lobby restaurant and bar, which is generally more limited in scope than what is offered at a full-service hotel. Moreover, the proposed subject hotel is anticipated to feature ground-floor retail (leased), meeting space, a fitness room, and a business center or lobby workstation.

The proposed subject hotel's occupancy forecast is set forth as follows, with the adjusted projected penetration rates used as a basis for calculating the amount of captured market demand.

Forecast of the
Proposed Subject
Hotel’s Occupancy
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Proposed Laguna Hills Hotel – Laguna Hills, California 19 FIGURE 3-12 FORECAST OF SUBJECT PROPERTY'S OCCUPANCY
Market Segment
Commercial
Demand 386,906 412,733 415,737 415,737
Market Share 3.6 % 6.7 % 7.2 % 7.2 %
Capture 13,945 27,721 29,897 29,897
Penetration 88 % 99 % 106 % 106 %
Leisure
Demand 129,611 133,094 134,063 134,063
Market Share 3.8 % 6.7 % 7.0 % 7.0 %
Capture 4,897 8,978 9,432 9,432
Penetration 92 % 99 % 104 % 104 %
Group
Demand 75,971 83,314 87,244 87,244
Market Share 2.3 % 4.6 % 5.3 % 5.3 %
Capture 1,717 3,844 4,612 4,612
Penetration 55 % 68 % 78 % 78 %
Total Room Nights Captured 20,559 40,542 43,941 43,941
Available Room Ni ghts 32,100 54,750 54,750 54,750
Subject Occupancy 64 % 74 % 80 % 80 %
Market-wide Avai labl e Room Nights 783,763 806,413 806,413 806,413 Fair Share 4 % 7 % 7 % 7 %
Market-wide Occupied Room Nights 592,488 629,141 637,044 637,044 Market Share 3 % 6 % 7 % 7 %
Market-wide Occupancy 76 % 78 % 79 % 79 %
Total Penetration 85 % 95 % 102 % 102 %
2023 2024 2025 2026
These positioned segment penetration rates result in the following market segmentation forecast.
o
Packet Pg. 367 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 20 FIGURE 3-13 MARKET SEGMENTATION FORECAST – SUBJECT PROPERTY Commercial 68 % 68 % 68 % 68 %
Leisure 24 22 21 21
Group 8 9 10 10
Total 100 % 100 % 100 % 100 %
2023 2024 2025 2026
These projections reflect years beginning June 1, 2023, which correspond to the first projection year in the forecast of income and expense for the proposed subject hotel.

The defined primarily competitive market realized an overall average rate of $144.17 in the 2020 base year, declining from the 2019 level of $169.33. The Marriott Irvine Spectrum Center (a secondary competitor) achieved the highest estimated average rate in the local competitive market, by a significant margin, because of the hotel's upper-upscale product offering, popular brand affiliation, and location adjacent to primary commercial demand generators. Of the primary competitive set, the Courtyard by Marriott Irvine Spectrum achieved the highest estimated average rate because of similar aforementioned factors, although this hotel offers a select-service product. Other important rate aspects of this market include location near Interstate 5 and proximity to commercial demand generators. The selected rate position for the proposed subject hotel, in base-year dollars, takes into consideration expected factors such as its ground-floor retail space, select-service amenities, and upscale product offering. We have selected the rate position of $175.00, in base-year dollars, for the proposed subject hotel. The final forecast reflects years beginning on June 1, 2023, and corresponds with our financial projections, as shown below.

Forecast of the
Proposed Subject
Hotel’s Average Rate
o
Packet Pg. 368 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 21 FIGURE 3-14 ADR FORECAST – MARKET AND PROPOSED SUBJECT HOTEL Calendar Year 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Market ADR $171.04 $132.27 $149.46 $167.40 $175.77 $181.04 $186.47 $192.07 $197.83 $203.76 Projected Market ADR Growth Rate — -22.7% 13.0% 12.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% Proposed Subject Property ADR (As-If Stabilized) $175.00 $135.33 $152.92 $171.27 $179.83 $185.23 $190.79 $196.51 $202.41 $208.48 ADR Growth Rate -22.7% 13.0% 12.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% Proposed Subject Stabilized ADR Penetration 102% 102% 102% 102% 102% 102% 102% 102% 102% 102.3% Fiscal Year 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 Proposed Subject Property Average Rate $182.07 $187.53 $193.15 $198.95 $204.92 $211.07 Opening Discount 3.0% 1.0% 0.0% 0.0% 0.0% 0.0%
Average Rate After Discount $176.60 $185.65 $193.15 $198.95 $204.92 $211.07 Real Average Rate Growth — 5.1% 4.0% 3.0% 3.0% 3.0%
Market ADR $177.95 $183.29 $188.79 $194.45 $200.29 $206.29 Proposed Subject ADR Penetration (After Discount) 99% 101% 102% 102% 102% 102% ADR Expressed in Base-Year Dollars Deflated @ Inflation Rate $160.02 $163.32 $164.97 $164.97 $164.97 $164.97 Historical
Discounts of 3% and 1% have been applied to the stabilized room rates projected for the first two years of operation, as would be expected for a new property of this type as it builds its reputation and becomes established in the market.

FIGURE 3-15 ADR AND OCCUPANCY FORECAST - CONCLUSION
Year
2023/24 68 % $182.07 3.0 % $176.60
2024/25 77 187.53 1.0 185.65
2025/26 80 193.15 0.0 193.15
Occupancy
Average Rate
Before Discount Discount
Average Rate
After Discount
The following table presents a detailed forecast through the fifth projection year, including amounts per available room (PAR) and per occupied room (POR). The second table illustrates our ten-year forecast of income and expense, presented with a lesser degree of detail. The forecasts pertain to years that begin on June 1, 2023, expressed in inflated dollars for each year.

Forecast of Income and
Expense
o
Packet Pg. 369 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 22 FIGURE 3-16 DETAILED FORECAST OF INCOME AND EXPENSE
2023/24 Begins June 2024/25 Stabilized 2026/27 2027/28
Number of Rooms: 150 150 150 150 150
Occupancy: 68% 77% 80% 80% 80%
Average Rate: $176.60 $185.65 $193.15 $198.95 $204.92
RevPAR: $120.09 $142.95 $154.52 $159.16 $163.93
Days Open: 365 365 365 365 365
Occupied Rooms: 37,230 %Gross PAR POR 42,158 %Gross PAR POR 43,800 %Gross PAR POR 43,800 %Gross PAR POR 43,800 %Gross PAR POR

OPERATING REVENUE
Rooms $6,575 89.9 % $43,833 $176.60 $7,827 90.5 % $52,180 $185.66 $8,460 90.7 % $56,400 $193.15 $8,714 90.7 % $58,093 $198.95 $8,975 90.7 % $59,833 $204.91 Food & Beverage 608 8.3 4,054 16.33 686 7.9 4,572 16.27 727 7.8 4,846 16.60 749 7.8 4,991 17.09 771 7.8 5,141 17.61 Other Operated Departments 93 1.3 623 2.51 100 1.2 665 2.36 104 1.1 692 2.37 107 1.1 713 2.44 110 1.1 734 2.52 Miscellaneous Income 35 0.5 234 0.94 37 0.4 249 0.89 39 0.4 260 0.89 40 0.4 267 0.92 41 0.4 275 0.94 Total Operating Revenues 7,312 100.0 48,744 196.39 8,650 100.0 57,666 205.18 9,330 100.0 62,198 213.01 9,610 100.0 64,065 219.40 9,898 100.0 65,984 225.97 DEPARTMENTAL EXPENSES *
Rooms 1,537 23.4 10,245 41.28 1,659 21.2 11,057 39.34 1,734 20.5 11,562 39.60 1,786 20.5 11,909 40.78 1,840 20.5 12,266 42.01 Food & Beverage 585 96.3 3,903 15.72 627 91.4 4,181 14.88 654 90.0 4,361 14.94 674 90.0 4,492 15.38 694 90.0 4,627 15.85 Other Operated Departments 39 41.3 257 1.04 40 40.3 268 0.95 42 40.0 277 0.95 43 40.0 285 0.98 44 40.0 294 1.01 Total Expenses 2,161 29.6 14,405 58.04 2,326 26.9 15,506 55.17 2,430 26.0 16,200 55.48 2,503 26.0 16,686 57.15 2,578 26.0 17,187 58.86 DEPARTMENTAL INCOME 5,151 70.4 34,339 138.35 6,324 73.1 42,160 150.01 6,900 74.0 45,997 157.53 7,107 74.0 47,379 162.26 7,320 74.0 48,797 167.11

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 812 11.1 5,415 21.82 824 9.5 5,496 19.56 818 8.8 5,453 18.67 842 8.8 5,616 19.23 868 8.8 5,785 19.81 Info & Telecom Systems 48 0.7 321 1.29 51 0.6 341 1.21 53 0.6 356 1.22 55 0.6 366 1.25 57 0.6 377 1.29 Marketing 477 6.5 3,179 12.81 484 5.6 3,226 11.48 480 5.1 3,201 10.96 494 5.1 3,297 11.29 509 5.1 3,395 11.63 Franchise Fee 569 7.8 3,792 15.28 677 7.8 4,514 16.06 732 7.8 4,879 16.71 754 7.8 5,025 17.21 776 7.8 5,176 17.72 Prop. Operations & Maint. 244 3.3 1,627 6.55 292 3.4 1,946 6.92 338 3.6 2,252 7.71 348 3.6 2,320 7.94 358 3.6 2,389 8.18 Utilities 257 3.5 1,712 6.90 273 3.2 1,821 6.48 284 3.0 1,897 6.50 293 3.0 1,954 6.69 302 3.0 2,012 6.89 Total Expenses 2,407 32.9 16,046 64.65 2,601 30.1 17,343 61.71 2,705 28.9 18,036 61.77 2,787 28.9 18,577 63.62 2,870 28.9 19,134 65.53 GROSS OPERATING PROFIT 2,744 37.5 18,293 73.70 3,723 43.0 24,817 88.30 4,194 45.1 27,961 95.76 4,320 45.1 28,801 98.63 4,449 45.1 29,663 101.58 Management Fee 219 3.0 1,462 5.89 259 3.0 1,730 6.16 280 3.0 1,866 6.39 288 3.0 1,922 6.58 297 3.0 1,980 6.78 INCOME BEFORE NON-OPR. INC. & EXP. 2,525 34.5 16,831 67.81 3,463 40.0 23,087 82.15 3,914 42.1 26,095 89.37 4,032 42.1 26,879 92.05 4,152 42.1 27,683 94.81

NON-OPERATING INCOME & EXPENSE
Property Taxes 425 5.8 2,834 11.42 434 5.0 2,891 10.29 442 4.7 2,948 10.10 451 4.7 3,007 10.30 460 4.6 3,068 10.51 Insurance 101 1.4 670 2.70 104 1.2 691 2.46 107 1.1 711 2.44 110 1.1 733 2.51 113 1.1 755 2.58 Retail Income (310) (4.2) (2,068) (8.33) (320) (3.7) (2,130) (7.58) (329) (3.5) (2,194) (7.51) (339) (3.5) (2,260) (7.74) (349) (3.5) (2,328) (7.97) Total Expenses 215 3.0 1,436 5.79 218 2.5 1,451 5.16 220 2.3 1,466 5.02 222 2.3 1,480 5.07 224 2.2 1,495 5.12 EBITDA 2,309 31.5 15,395 62.03 3,245 37.5 21,636 76.98 3,694 39.8 24,629 84.35 3,810 39.8 25,399 86.98 3,928 39.9 26,189 89.69 Reserve for Replacement 146 2.0 975 3.93 259 3.0 1,730 6.16 373 4.0 2,488 8.52 384 4.0 2,563 8.78 396 4.0 2,639 9.04 EBITDA LESS RESERVE $2,163 29.5 % $14,420 $58.10 $2,986 34.5 % $19,906 $70.83 $3,321 35.8 % $22,142 $75.83 $3,425 35.8 % $22,836 $78.21 $3,532 35.9 % $23,549 $80.65 *Departmental expenses are expressed as a percentage of departmental revenues. o
Packet Pg. 370 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 23 FIGURE 3-17 TEN-YEAR FORECAST OF INCOME AND EXPENSE
2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 Number of Rooms: 150 150 150 150 150 150 150 150 150 150 Occupied Rooms: 37,230 42,158 43,800 43,800 43,800 43,800 43,800 43,800 43,800 43,800 Occupancy: 68% 77% 80% 80% 80% 80% 80% 80% 80% 80%
Average Rate: $176.60 % of $185.65 % of $193.15 % of $198.95 % of $204.92 % of $211.07 % of $217.40 % of $223.92 % of $230.64 % of $237.56 RevPAR: $120.09 Gross $142.95 Gross $154.52 Gross $159.16 Gross $163.93 Gross $168.85 Gross $173.92 Gross $179.14 Gross $184.51 Gross $190.04

OPERATING REVENUE
Rooms $6,575 89.9 % $7,827 90.5 % $8,460 90.7 % $8,714 90.7 % $8,975 90.7 % $9,245 90.7 % $9,522 90.7 % $9,808 90.7 % $10,102 90.7 % $10,405 90.7 % Food & Beverage 608 8.3 686 7.9 727 7.8 749 7.8 771 7.8 794 7.8 818 7.8 843 7.8 868 7.8 894 7.8 Other Operated Departments 93 1.3 100 1.2 104 1.1 107 1.1 110 1.1 113 1.1 117 1.1 120 1.1 124 1.1 128 1.1 Miscellaneous Income 35 0.5 37 0.4 39 0.4 40 0.4 41 0.4 43 0.4 44 0.4 45 0.4 46 0.4 48 0.4 Total Operating Revenues 7,312 100.0 8,650 100.0 9,330 100.0 9,610 100.0 9,898 100.0 10,195 100.0 10,501 100.0 10,816 100.0 11,140 100.0 11,475 100.0 DEPARTMENTAL EXPENSES *
Rooms 1,537 23.4 1,659 21.2 1,734 20.5 1,786 20.5 1,840 20.5 1,895 20.5 1,952 20.5 2,011 20.5 2,071 20.5 2,133 20.5 Food & Beverage 585 96.3 627 91.4 654 90.0 674 90.0 694 90.0 715 90.0 736 90.0 758 90.0 781 90.0 805 90.0 Other Operated Departments 39 41.3 40 40.3 42 40.0 43 40.0 44 40.0 45 40.0 47 40.0 48 40.0 50 40.0 51 40.0 Total Expenses 2,161 29.6 2,326 26.9 2,430 26.0 2,503 26.0 2,578 26.0 2,655 26.0 2,735 26.0 2,817 26.0 2,902 26.0 2,989 26.0 DEPARTMENTAL INCOME 5,151 70.4 6,324 73.1 6,900 74.0 7,107 74.0 7,320 74.0 7,540 74.0 7,766 74.0 7,999 74.0 8,239 74.0 8,486 74.0

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 812 11.1 824 9.5 818 8.8 842 8.8 868 8.8 894 8.8 921 8.8 948 8.8 977 8.8 1,006 8.8 Info & Telecom Systems 48 0.7 51 0.6 53 0.6 55 0.6 57 0.6 58 0.6 60 0.6 62 0.6 64 0.6 66 0.6 Marketing 477 6.5 484 5.6 480 5.1 494 5.1 509 5.1 525 5.1 540 5.1 557 5.1 573 5.1 590 5.1 Franchise Fee 569 7.8 677 7.8 732 7.8 754 7.8 776 7.8 800 7.8 824 7.8 848 7.8 874 7.8 900 7.8 Prop. Operations & Maint. 244 3.3 292 3.4 338 3.6 348 3.6 358 3.6 369 3.6 380 3.6 392 3.6 403 3.6 415 3.6 Utilities 257 3.5 273 3.2 284 3.0 293 3.0 302 3.0 311 3.0 320 3.0 330 3.0 340 3.0 350 3.0 Total Expenses 2,407 32.9 2,601 30.1 2,705 28.9 2,787 28.9 2,870 28.9 2,956 28.9 3,045 28.9 3,136 28.9 3,230 28.9 3,327 28.9 GROSS OPERATING PROFIT 2,744 37.5 3,723 43.0 4,194 45.1 4,320 45.1 4,449 45.1 4,584 45.1 4,721 45.1 4,863 45.1 5,008 45.1 5,159 45.1 Management Fee 219 3.0 259 3.0 280 3.0 288 3.0 297 3.0 306 3.0 315 3.0 324 3.0 334 3.0 344 3.0 INCOME BEFORE NON-OPR. INC. & EXP. 2,525 34.5 3,463 40.0 3,914 42.1 4,032 42.1 4,152 42.1 4,278 42.1 4,406 42.1 4,538 42.1 4,674 42.1 4,814 42.1

NON-OPERATING INCOME & EXPENSE
Property Taxes 425 5.8 434 5.0 442 4.7 451 4.7 460 4.6 469 4.6 479 4.6 488 4.5 498 4.5 508 4.4 Insurance 101 1.4 104 1.2 107 1.1 110 1.1 113 1.1 117 1.1 120 1.1 124 1.1 127 1.1 131 1.1 Retail Income (310) (4.2) (320) (3.7) (329) (3.5) (339) (3.5) (349) (3.5) (360) (3.5) (370) (3.5) (382) (3.5) (393) (3.5) (405) (3.5) Total Expenses 215 3.0 218 2.5 220 2.3 222 2.3 224 2.2 226 2.2 228 2.2 230 2.1 232 2.1 234 2.0 EBITDA 2,309 31.5 3,245 37.5 3,694 39.8 3,810 39.8 3,928 39.9 4,051 39.9 4,177 39.9 4,308 40.0 4,442 40.0 4,580 40.1 Reserve for Replacement 146 2.0 259 3.0 373 4.0 384 4.0 396 4.0 408 4.0 420 4.0 433 4.0 446 4.0 459 4.0 EBITDA LESS RESERVE $2,163 29.5 % $2,986 34.5 % $3,321 35.8 % $3,425 35.8 % $3,532 35.9 % $3,644 35.9 % $3,757 35.9 % $3,875 36.0 % $3,996 36.0 % $4,121 36.1 % 0 0 0 0 0 0 0 0 0 0
% of
Gross
o
Packet Pg. 371
Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 24 Our positioning of each revenue and expense level is supported by comparable operations or trends specific to this market.

FIGURE 3-18 COMPARABLE OPERATING STATEMENTS: RATIO TO SALES Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2018 2018 2018 2017 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 150 to 200 80 to 100 100 to 130 190 to 240 170 to 220 150 Days Open: 365 365 365 365 365 365
Occupancy: 80% 80% 80% 76% 81% 80%
Average Rate: $159 $164 $163 $172 $172 $163
RevPAR: $127 $131 $130 $131 $138 $130

REVENUE
Rooms 82.3 % 93.7 % 93.1 % 92.8 % 84.6 % 90.7 %
Food & Beverage 9.1 4.5 5.4 5.1 13.3 7.8
Other Operated Departments 7.0 1.1 1.0 0.3 1.3 1.1
Mi scellaneous Income 1.6 0.7 0.5 1.8 0.9 0.4
Total 100.0 100.0 100.0 100.0 100.0 100.0
DEPARTMENTAL EXPENSES*
Rooms 21.7 18.8 16.2 20.2 21.7 20.5
Food & Beverage 86.7 131.3 96.7 45.3 85.4 90.0
Other Operated Departments 10.1 36.2 52.8 69.8 15.0 40.0 Total 26.4 23.9 20.8 21.3 29.9 26.0
DEPARTMENTAL INCOME 73.6 76.1 79.2 78.7 70.1 74.0

UNDISTRIBUTED OPERATING EXPENSES
Admi nistrative & General 7.0 10.0 7.6 8.7 11.3 8.8
Info. and Telecom. Systems 0.6 1.0 0.4 1.1 1.1 0.6
Marketi ng 4.9 6.6 3.6 8.1 7.0 5.1
Franchis e Fee 6.2 5.1 6.4 4.4 7.3 7.8
Property Operations & Maintenance 3.6 3.5 3.2 4.2 4.1 3.6 Utilities 3.1 3.3 2.5 2.8 3.6 3.0
Total 25.4 29.5 23.8 29.4 34.3 29.0
GROSS OPERATING PROFIT 48.2 46.6 55.4 49.3 35.8 45.0
Management Fee 2.9 3.5 4.0 4.7 2.0 3.0
INCOME BEFORE NON-OPER. INC. & EXP. 45.3 43.1 51.4 44.6 33.8 42.0 EBITDA LESS RESERVE 36.2 % 35.6 % 47.7 % 36.9 % 29.7 % 35.6 % * Departmental expense ratios are expressed as a percentage of departmental revenues Stabilized $
o
Packet Pg. 372 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 25 FIGURE 3-19 COMPARABLE OPERATING STATEMENTS: AMOUNTS PER AVAILABLE ROOM Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2018 2018 2018 2017 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 150 to 200 80 to 100 100 to 130 190 to 240 170 to 220 150 Days Open: 365 365 365 365 365 365
Occupancy: 80% 80% 80% 76% 81% 80%
Average Rate: $159 $164 $163 $172 $172 $163
RevPAR: $127 $131 $130 $131 $138 $130

REVENUE
Rooms $46,403 $47,761 $47,444 $47,890 $50,525 $47,581
Food & Beverage 5,103 2,310 2,731 2,648 7,930 4,088
Other Operated Departments 3,964 536 498 143 753 584
Miscellaneous Income 903 380 278 925 513 219
Total 56,374 50,987 50,951 51,606 59,721 52,472

DEPARTMENTAL EXPENSES
Rooms 10,048 8,977 7,704 9,675 10,979 9,754
Food & Beverage 4,426 3,034 2,641 1,200 6,771 3,679
Other Operated Departments 399 194 263 100 113 234
Total 14,873 12,205 10,608 10,975 17,863 13,667
DEPARTMENTAL INCOME 41,500 38,782 40,343 40,630 41,857 38,805

UNDISTRIBUTED OPERATING EXPENSES
Adminis trative & General 3,964 5,095 3,880 4,505 6,754 4,600 Info. and Telecom. Systems 352 507 202 572 628 300
Marketing 2,737 3,347 1,841 4,192 4,166 2,700
Franchise Fee 3,515 2,620 3,275 2,274 4,356 4,116
Property Operati ons & Maintenance 2,024 1,790 1,646 2,159 2,449 1,900 Utiliti es 1,740 1,657 1,295 1,458 2,123 1,600
Total 14,333 15,017 12,138 15,160 20,477 15,216
GROSS OPERATING PROFIT 27,167 23,765 28,205 25,470 21,380 23,589 Management Fee 1,635 1,785 2,038 2,436 1,194 1,574
INCOME BEFORE NON-OPER. INC. & EXP. 25,533 21,980 26,167 23,034 20,186 22,015 EBITDA LESS RESERVE $20,409 $18,119 $24,299 $19,070 $17,777 $18,680 Stabilized $
o
Packet Pg. 373 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 26 FIGURE 3-20 COMPARABLE OPERATING STATEMENTS: AMOUNTS PER OCCUPIED ROOM Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2018 2018 2018 2017 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 150 to 200 80 to 100 100 to 130 190 to 240 170 to 220 150 Days Open: 365 365 365 365 365 365
Occupancy: 80% 80% 80% 76% 81% 80%
Average Rate: $159 $164 $163 $172 $172 $163
RevPAR: $127 $131 $130 $131 $138 $130

REVENUE
Rooms $158.72 $163.87 $163.33 $172.19 $171.53 $162.95
Food & Beverage 17.45 7.93 9.40 9.52 26.92 14.00
Other Operated Departments 13.56 1.84 1.72 0.51 2.56 2.00 Miscellaneous Income 3.09 1.30 0.96 3.33 1.74 0.75
Tota l 192.82 174.93 175.40 185.55 202.75 179.70

DEPARTMENTAL EXPENSES
Rooms 34.37 30.80 26.52 34.79 37.27 33.40
Food & Beverage 15.14 10.41 9.09 4.32 22.99 12.60
Other Operated Departments 1.36 0.67 0.91 0.36 0.38 0.80 Tota l 50.87 41.88 36.52 39.46 60.65 46.80
DEPARTMENTAL INCOME 141.95 133.06 138.89 146.09 142.10 132.89

UNDISTRIBUTED OPERATING EXPENSES
Adminis trative & General 13.56 17.48 13.36 16.20 22.93 15.75 Info. and Telecom. Systems 1.20 1.74 0.69 2.06 2.13 1.03 Ma rketing 9.36 11.48 6.34 15.07 14.14 9.25
Fra nchis e Fee 12.02 8.99 11.27 8.18 14.79 14.09
Property Operations & Ma intena nce 6.92 6.14 5.67 7.76 8.31 6.51 Utilities 5.95 5.69 4.46 5.24 7.21 5.48
Tota l 49.02 51.52 41.79 54.51 69.52 52.11
GROSS OPERATING PROFIT 92.92 81.53 97.10 91.58 72.59 80.79 Management Fee 5.59 6.12 7.02 8.76 4.05 5.39
INCOME BEFORE NON-OPER. INC. & EXP. 87.33 75.41 90.08 82.82 68.53 75.39 EBITDA LESS RESERVE $69.80 $62.16 $83.65 $68.57 $60.35 $63.97 Stabilized $
In conclusion, our analysis reflects a profitable operation, with net income expected to total 35.9% of total revenue by the stabilized year. The stabilized total revenue comprises primarily rooms revenue, with a secondary portion derived from other income sources. On the cost side, departmental expenses total 26.0% of o
Packet Pg. 374 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 27 revenue by the stabilized year, while undistributed operating expenses total

28.9% of total revenues; this assumes that the proposed subject property will be operated competently by a well-known hotel operator. After a 3.0% of total revenues management fee, a net income ratio of 40.3% is forecast by the stabilized year.

FIGURE 3-21 DISCOUNTED CASH FLOW FOR FEASIBILITY CALCULATION 3 10.0 %

8.5 3.0
Discounted
Year 10% Cash Flow
2023/24 $2,588,056 $425,583 $2,162,474 0.90909 $1,965,885 2024/25 3,419,517 434,094 2,985,423 0.82645 2,467,291
2025/26 3,763,494 442,776 3,320,718 0.75131 2,494,904
2026/27 3,876,557 451,632 3,424,925 0.68301 2,339,270
2027/28 3,992,521 460,664 3,531,857 0.62092 2,193,005
2028/29 4,112,890 469,877 3,643,013 0.56447 2,056,386
2029/30 4,236,277 479,275 3,757,002 0.51316 1,927,936
2030/31 4,363,365 488,861 3,874,504 0.46651 1,807,485
2031/32 4,494,266 498,638 3,995,628 0.42410 1,694,536
2032/33 4,629,094 508,610 58,368,654 * 0.38554 22,503,643 Estimated Market Value $41,450,342
(SAY) $41,500,000
Per Room 280,000
Reversion Analysis
$4,767,967
Capitali zation Rate (loaded with ta x ra te) 8.5%
Total Sales Proceeds $55,925,949
Less: Tra nsaction Costs @ 3.0% 1,677,778
Net Sales Proceeds (Sa y) 54,248,170
11th Yea r's EBITDA Less Reserves (not i ncluding taxes) *10th year NOI after taxes, plus the reversionary value.

Sta bili zed Year
Discount Rate
Loaded Terminal Ca p
Transaction Costs
Net Income,
Before Taxes
Property
Taxes
Net Income, After
Taxes
Discount Factor @
Our discounted cash flow analysis indicates a net present value for the proposed subject property of $41,500,000 or $280,000 per room.

Based on our review of investor surveys, sales transactions, and interviewing market participants, we have selected a discount rate of 10.0% and a terminal cap rate of 8.5% in our analysis. Due to the subject property's California location and the higher property tax implications upon the sale at the end of the hold, the terminal capitalization rate is loaded with the tax rate and is applied to the NOI estimate prior to property taxes.

Feasibility Analysis
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Packet Pg. 375 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 28 The below cost estimates are derived from the 2020 HVS Development Cost Survey, as well as our market and industry knowledge.

FIGURE 3-22 COST COMPARABLES
Item
Building $197,137 82.6 % $194,444 73.9 % $197,137 82.6 % $201,222 75.7 % Soft Costs 20,144 8.4 36,343 13.8 20,144 8.4 38,690 14.6 Furniture, Fixtures, & Equipment 20,000 8.4 27,778 10.6 20,000 8.4 18,613 7.0 Pre-Opening Cos ts & Working Capital 1,429 0.6 0 0.0 1,429 0.6 7,320 2.8 Developer Fee (if Applicable) 0 0.0 4,630 1.8 0 0.0 0 0.0 Tota l (Excluding Site Cos t) $238,709 94.3 % $263,194 86.6 % $238,709 94.3 % $265,845 88.0 % Site Cost $14,457 5.7 % $40,741 13.4 % $14,457 5.7 % $36,082 12.0 % Total (Including Site Cost) $253,167 100.0 % $303,935 100.0 % $253,167 100.0 % $301,927 100.0 % Comp #1 Comp #2 Comp #3 Comp #4
Secondary, CA Secondary, CA Secondary, CA Secondary, CA Select-Service Extended Stay Midscale Select-Service Extended Stay Upscale Approx. 180 Rooms Approx. 110 Rooms Approx. 180 Rooms Approx. 190 Rooms Per Room % of Total Per Room % of Total Per Room % of Total Per Room % of Total FIGURE 3-23 HVS DEVELOPMENT COST POSITIONING - UPSCALE
Item
Building $194,444 73.9 % $201,222 82.6 % $197,485 78.7 % $180,000 66.1 % Soft Costs 20,144 8.4 38,690 14.6 28,830 11.3 28,000 10.3 Furniture, Fixtures , & Equipment 18,613 7.0 27,778 10.6 21,598 8.6 25,000 9.2 Pre-Opening Cos ts & Working Capital 0 0.0 7,320 2.8 2,544 1.0 5,000 1.8 Developer Fee (if Applicable) 0 0.0 4,630 1.8 1,157 0.6 5,000 1.8 Tota l (Excluding Site Cos t) $238,709 $265,845 $251,615 $243,000 89.2 % Site Cost $14,457 5.7 % $40,741 13.4 % 26,434 9.2 % $29,333 10.8 % Total (Including Site Cost) $253,167 $306,586 $278,049 $272,333 100.0 % Average Subject Property
Per Room % of Total Per Room % of Total Per Room % of Total Per Room % of Total Minimum Maximum
o
Packet Pg. 376 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 29 FIGURE 3-24 HVS DEVELOPMENT COST ESTIMATE - UPSCALE
Item
Building $180,000 $27,000,000
Soft Costs 28,000 4,200,000
Furniture, Fixtures, & Equipment 25,000 3,750,000
Pre-Opening Costs & Working Capital 5,000 750,000
Developer Fee (if Applicable) 5,000 750,000
Land 29,333 4,400,000
Total Cost New Before Incentive $273,000 $40,900,000
Cost per Room Cost
The derived net present value of $41,500,000 is 1.5% higher than the estimated replacement cost of $40,900,000.

Based on our market analysis, there is sufficient market support for the proposed, upscale, select-service hotel. It is important to note that the retail component is an important aspect in our analysis and the project's feasibility is based on the inclusion of this component. Our assumption of replacement cost was developed utilizing development costs from comparable select-service properties in California, derived from the 2020 HVS Development Cost Survey. We have utilized a discounted cash flow (DCF) analysis to come to our conclusion of value upon completion of the project. The when-complete value is above the assumed replacement cost, deeming the project feasible.
o
Packet Pg. 377 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 30

4. Upper-Upscale Analysis
In the second scenario, the proposed subject hotel is expected to be operated as an upper-upscale, full-service lodging facility, to be affiliated with a national brand.

Some brands that fall under this category include Embassy Suites by Hilton, Omni, Sheraton, and the full-service flagship Marriott and Hilton hotels. These hotels typically include a lobby restaurant and bar, which is more complex in scope than what is offered at a select-service hotel; moreover, other food and beverage (F&B) outlets are often provided, such as a fine-dining establishment with elevated offerings and a more robust menu, a café, or a grab-and-go type of outlet. Other services typically present in a full-service hotel include a concierge and room service. Moreover, the proposed subject hotel is anticipated to feature groundfloor retail (leased), meeting space, a fitness center, and a business center, as well as a gift shop.

The proposed subject hotel's occupancy forecast is set forth as follows, with the adjusted projected penetration rates used as a basis for calculating the amount of captured market demand.

Forecast of the
Proposed Subject
Hotel’s Occupancy
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Packet Pg. 378 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 31 FIGURE 4-25 FORECAST OF SUBJECT PROPERTY'S OCCUPANCY
Market Segment
Commercial
Demand 386,906 412,733 415,737 415,737
Market Share 3.6 % 6.7 % 7.1 % 7.1 %
Capture 13,800 27,474 29,651 29,651
Penetration 87 % 98 % 105 % 105 %
Leisure
Demand 129,611 133,094 134,063 134,063
Market Share 3.8 % 6.7 % 7.0 % 7.0 %
Capture 4,897 8,978 9,432 9,432
Penetration 92 % 99 % 104 % 104 %
Group
Demand 75,971 83,314 87,244 87,244
Market Share 2.3 % 4.7 % 5.4 % 5.4 %
Capture 1,780 3,957 4,728 4,728
Penetration 57 % 70 % 80 % 80 %
Total Room Nights Captured 20,477 40,409 43,812 43,812
Available Room Nights 32,100 54,750 54,750 54,750
Subject Occupancy 64 % 74 % 80 % 80 %
Market-wide Available Room Nights 783,763 806,413 806,413 806,413 Fair Share 4 % 7 % 7 % 7 %
Market-wide Occupied Room Nights 592,488 629,141 637,044 637,044 Market Share 3 % 6 % 7 % 7 %
Market-wide Occupancy 76 % 78 % 79 % 79 %
Total Penetration 84 % 95 % 101 % 101 %
2023 2024 2025 2026
These positioned segment penetration rates result in the following market segmentation forecast.
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Packet Pg. 379 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 32 FIGURE 4-26 MARKET SEGMENTATION FORECAST – SUBJECT PROPERTY Commercial 67 % 68 % 68 % 68 %
Leisure 24 22 22 22
Group 9 10 11 11
Total 100 % 100 % 100 % 100 %
2023 2024 2025 2026
The defined primarily competitive market realized an overall average rate of $144.17 in the 2020 base year, declining from the 2019 level of $169.33. The Marriott Irvine Spectrum Center (a secondary competitor) achieved the highest estimated average rate in the local competitive market, by a significant margin, because of the hotel's upper-upscale product offering, popular brand affiliation, and location adjacent to primary commercial demand generators. Of the primary competitive set, the Courtyard by Marriott Irvine Spectrum achieved the highest estimated average rate because of similar aforementioned factors, although this hotel offers a select-service product. Other important rate aspects of this market include location near Interstate 5 and proximity to commercial demand generators. The selected rate position for the proposed subject hotel, in base-year dollars, takes into consideration expected factors such as its ground-floor retail space, full-service amenities, and upper-upscale product offering. We have selected the rate position of $205.00, in base-year dollars, for the proposed subject hotel. The final forecast reflects years beginning on June 1, 2023, and corresponds with our financial projections, as shown below.

Forecast of the
Proposed Subject
Hotel’s Average Rate
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Packet Pg. 380 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 33 FIGURE 4-27 ADR FORECAST – MARKET AND PROPOSED SUBJECT HOTEL Calendar Year 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Market ADR $171.04 $132.27 $149.46 $167.40 $175.77 $181.04 $186.47 $192.07 $197.83 $203.76 Projected Market ADR Growth Rate — -22.7% 13.0% 12.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% Proposed Subject Property ADR (As-If Stabilized) $205.00 $158.53 $179.14 $200.63 $210.66 $216.98 $223.49 $230.20 $237.10 $244.22 ADR Growth Rate -22.7% 13.0% 12.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% Proposed Subject Sta bilized ADR Penetration 120% 120% 120% 120% 120% 120% 120% 120% 120% 119.9% Fiscal Year 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 Proposed Subject Property Average Rate $213.28 $219.68 $226.27 $233.05 $240.05 $247.25 Opening Discount 3.0% 1.0% 0.0% 0.0% 0.0% 0.0%
Average Rate After Discount $206.88 $217.48 $226.27 $233.05 $240.05 $247.25 Real Average Rate Growth — 5.1% 4.0% 3.0% 3.0% 3.0%
Market ADR $177.95 $183.29 $188.79 $194.45 $200.29 $206.29 Proposed Subject ADR Penetration (After Discount) 116% 119% 120% 120% 120% 120% ADR Expressed in Base-Yea r Dollars Deflated @ Inflation Rate $187.45 $191.31 $193.25 $193.25 $193.25 $193.25 Discounts of 3% and 1% have been applied to the stabilized room rates projected for the first two years of operation, as would be expected for a new property of this type as it builds its reputation and becomes established in the market.

FIGURE 4-28 ADR AND OCCUPANCY FORECAST - CONCLUSION
Year
2023/24 68 % $213.28 3.0 % $206.88
2024/25 76 219.68 1.0 217.48
2025/26 80 226.27 0.0 226.27
Occupancy
Average Rate
Before Discount Discount
Average Rate
After Discount
The following table presents a detailed forecast through the fifth projection year, including amounts per available room (PAR) and per occupied room (POR). The second table illustrates our ten-year forecast of income and expense, presented with a lesser degree of detail. The forecasts pertain to years that begin on June 1, 2023, expressed in inflated dollars for each year.

Forecast of Income and
Expense
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Packet Pg. 381 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 34 FIGURE 4-29 DETAILED FORECAST OF INCOME AND EXPENSE
2023/24 Begins June 2024/25 Stabilized 2026/27 2027/28
Number of Rooms: 150 150 150 150 150
Occupancy: 68% 76% 80% 80% 80%
Average Rate: $206.88 $217.48 $226.27 $233.05 $240.05
RevPAR: $140.68 $165.28 $181.01 $186.44 $192.04
Days Open: 365 365 365 365 365
Occupied Rooms: 37,230 %Gross PAR POR 41,610 %Gross PAR POR 43,800 %Gross PAR POR 43,800 %Gross PAR POR 43,800 %Gross PAR POR

OPERATING REVENUE
Rooms $7,702 79.8 % $51,347 $206.88 $9,049 79.2 % $60,327 $217.47 $9,910 79.6 % $66,067 $226.26 $10,208 79.6 % $68,053 $233.06 $10,514 79.6 % $70,093 $240.05 Food & Beverage 1,759 18.2 11,727 47.25 2,183 19.1 14,555 52.47 2,336 18.8 15,576 53.34 2,406 18.8 16,043 54.94 2,479 18.8 16,524 56.59 Other Operated Departments 140 1.5 935 3.77 149 1.3 993 3.58 156 1.3 1,038 3.56 160 1.3 1,070 3.66 165 1.3 1,102 3.77 Miscellaneous Income 47 0.5 312 1.26 50 0.4 331 1.19 52 0.4 346 1.19 53 0.4 357 1.22 55 0.4 367 1.26 Total Operating Revenues 9,648 100.0 64,320 259.15 11,431 100.0 76,206 274.71 12,454 100.0 83,027 284.34 12,828 100.0 85,523 292.89 13,213 100.0 88,087 301.67 DEPARTMENTAL EXPENSES *
Rooms 2,020 26.2 13,464 54.25 2,169 24.0 14,458 52.12 2,279 23.0 15,196 52.04 2,348 23.0 15,652 53.60 2,418 23.0 16,122 55.21 Food & Beverage 1,602 91.1 10,682 43.04 1,784 81.7 11,894 42.88 1,869 80.0 12,461 42.67 1,925 80.0 12,834 43.95 1,983 80.0 13,220 45.27 Other Operated Departments 72 51.6 483 1.95 75 50.5 502 1.81 78 50.0 519 1.78 80 50.0 535 1.83 83 50.0 551 1.89 Total Expenses 3,694 38.3 24,629 99.23 4,028 35.2 26,854 96.81 4,226 33.9 28,176 96.49 4,353 33.9 29,021 99.39 4,484 33.9 29,892 102.37 DEPARTMENTAL INCOME 5,954 61.7 39,691 159.92 7,403 64.8 49,352 177.91 8,228 66.1 54,851 187.85 8,475 66.1 56,501 193.50 8,729 66.1 58,195 199.30

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 846 8.8 5,637 22.71 858 7.5 5,721 20.62 853 6.9 5,690 19.49 879 6.9 5,861 20.07 905 6.9 6,036 20.67 Info & Telecom Systems 80 0.8 534 2.15 85 0.7 568 2.05 89 0.7 593 2.03 92 0.7 610 2.09 94 0.7 629 2.15 Marketing 722 7.5 4,815 19.40 733 6.4 4,887 17.62 729 5.9 4,860 16.64 751 5.9 5,006 17.14 773 5.9 5,156 17.66 Franchise Fee 732 7.6 4,878 19.65 860 7.5 5,731 20.66 941 7.6 6,276 21.49 970 7.6 6,465 22.14 999 7.6 6,659 22.80 Prop. Operations & Maint. 231 2.4 1,537 6.19 276 2.4 1,839 6.63 320 2.6 2,134 7.31 330 2.6 2,198 7.53 340 2.6 2,264 7.75 Utilities 296 3.1 1,975 7.96 315 2.8 2,100 7.57 329 2.6 2,193 7.51 339 2.6 2,259 7.74 349 2.6 2,326 7.97 Total Expenses 2,906 30.2 19,375 78.06 3,127 27.3 20,845 75.15 3,262 26.3 21,745 74.47 3,360 26.3 22,398 76.71 3,461 26.3 23,070 79.01 GROSS OPERATING PROFIT 3,047 31.5 20,316 81.85 4,276 37.5 28,507 102.76 4,966 39.8 33,106 113.38 5,115 39.8 34,103 116.79 5,269 39.8 35,125 120.29 Management Fee 289 3.0 1,930 7.77 343 3.0 2,286 8.24 374 3.0 2,491 8.53 385 3.0 2,566 8.79 396 3.0 2,643 9.05 INCOME BEFORE NON-OPR. INC. & EXP. 2,758 28.5 18,386 74.08 3,933 34.5 26,221 94.52 4,592 36.8 30,615 104.85 4,731 36.8 31,537 108.00 4,872 36.8 32,482 111.24

NON-OPERATING INCOME & EXPENSE
Property Taxes 485 5.0 3,233 13.03 495 4.3 3,298 11.89 505 4.1 3,364 11.52 515 4.0 3,431 11.75 525 4.0 3,500 11.99 Insurance 101 1.0 670 2.70 104 0.9 691 2.49 107 0.9 711 2.44 110 0.9 733 2.51 113 0.9 755 2.58 Retail Income (310) (3.2) (2,068) (8.33) (320) (2.8) (2,130) (7.68) (329) (2.6) (2,194) (7.51) (339) (2.6) (2,260) (7.74) (349) (2.6) (2,328) (7.97) Total Expenses 275 2.8 1,836 7.40 279 2.4 1,858 6.70 282 2.4 1,881 6.44 286 2.3 1,904 6.52 289 2.3 1,927 6.60 EBITDA 2,483 25.7 16,551 66.68 3,654 32.1 24,362 87.82 4,310 34.4 28,734 98.40 4,445 34.5 29,633 101.48 4,583 34.5 30,555 104.64 Reserve for Replacement 193 2.0 1,286 5.18 343 3.0 2,286 8.24 498 4.0 3,321 11.37 513 4.0 3,421 11.72 529 4.0 3,523 12.07 EBITDA LESS RESERVE $2,290 23.7 % $15,264 $61.50 $3,311 29.1 % $22,076 $79.58 $3,812 30.4 % $25,413 $87.03 $3,932 30.5 % $26,213 $89.77 $4,055 30.5 % $27,032 $92.58 *Departmental expenses are expressed as a percentage of departmental revenues. o
Packet Pg. 382
Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 35 FIGURE 4-30 TEN-YEAR FORECAST OF INCOME AND EXPENSE
2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32 2032/33 Number of Rooms: 150 150 150 150 150 150 150 150 150 150 Occupied Rooms: 37,230 41,610 43,800 43,800 43,800 43,800 43,800 43,800 43,800 43,800 Occupancy: 68% 76% 80% 80% 80% 80% 80% 80% 80% 80%
Average Rate: $206.88 % of $217.48 % of $226.27 % of $233.05 % of $240.05 % of $247.25 % of $254.67 % of $262.31 % of $270.17 % of $278.28 RevPAR: $140.68 Gross $165.28 Gross $181.01 Gross $186.44 Gross $192.04 Gross $197.80 Gross $203.73 Gross $209.84 Gross $216.14 Gross $222.62

OPERATING REVENUE
Rooms $7,702 79.8 % $9,049 79.2 % $9,910 79.6 % $10,208 79.6 % $10,514 79.6 % $10,829 79.6 % $11,154 79.6 % $11,489 79.6 % $11,834 79.6 % $12,189 79.6 % Food & Beverage 1,759 18.2 2,183 19.1 2,336 18.8 2,406 18.8 2,479 18.8 2,553 18.8 2,630 18.8 2,709 18.8 2,790 18.8 2,873 18.8 Other Operated Departments 140 1.5 149 1.3 156 1.3 160 1.3 165 1.3 170 1.3 175 1.3 181 1.3 186 1.3 192 1.3 Miscellaneous Income 47 0.5 50 0.4 52 0.4 53 0.4 55 0.4 57 0.4 58 0.4 60 0.4 62 0.4 64 0.4 Total Operating Revenues 9,648 100.0 11,431 100.0 12,454 100.0 12,828 100.0 13,213 100.0 13,609 100.0 14,017 100.0 14,438 100.0 14,872 100.0 15,318 100.0 DEPARTMENTAL EXPENSES *
Rooms 2,020 26.2 2,169 24.0 2,279 23.0 2,348 23.0 2,418 23.0 2,491 23.0 2,565 23.0 2,642 23.0 2,722 23.0 2,803 23.0 Food & Beverage 1,602 91.1 1,784 81.7 1,869 80.0 1,925 80.0 1,983 80.0 2,042 80.0 2,104 80.0 2,167 80.0 2,232 80.0 2,299 80.0 Other Operated Departments 72 51.6 75 50.5 78 50.0 80 50.0 83 50.0 85 50.0 88 50.0 90 50.0 93 50.0 96 50.0 Total Expenses 3,694 38.3 4,028 35.2 4,226 33.9 4,353 33.9 4,484 33.9 4,618 33.9 4,757 33.9 4,900 33.9 5,047 33.9 5,198 33.9 DEPARTMENTAL INCOME 5,954 61.7 7,403 64.8 8,228 66.1 8,475 66.1 8,729 66.1 8,991 66.1 9,261 66.1 9,539 66.1 9,825 66.1 10,120 66.1

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 846 8.8 858 7.5 853 6.9 879 6.9 905 6.9 933 6.9 961 6.9 989 6.9 1,019 6.9 1,050 6.9 Info & Telecom Systems 80 0.8 85 0.7 89 0.7 92 0.7 94 0.7 97 0.7 100 0.7 103 0.7 106 0.7 109 0.7 Marketing 722 7.5 733 6.4 729 5.9 751 5.9 773 5.9 797 5.9 820 5.9 845 5.9 870 5.9 897 5.9 Franchise Fee 732 7.6 860 7.5 941 7.6 970 7.6 999 7.6 1,029 7.6 1,060 7.6 1,091 7.6 1,124 7.6 1,158 7.6 Prop. Operations & Maint. 231 2.4 276 2.4 320 2.6 330 2.6 340 2.6 350 2.6 360 2.6 371 2.6 382 2.6 394 2.6 Utilities 296 3.1 315 2.8 329 2.6 339 2.6 349 2.6 359 2.6 370 2.6 381 2.6 393 2.6 405 2.6 Total Expenses 2,906 30.2 3,127 27.3 3,262 26.3 3,360 26.3 3,461 26.3 3,564 26.3 3,671 26.3 3,781 26.3 3,895 26.3 4,012 26.3 GROSS OPERATING PROFIT 3,047 31.5 4,276 37.5 4,966 39.8 5,115 39.8 5,269 39.8 5,426 39.8 5,589 39.8 5,757 39.8 5,930 39.8 6,108 39.8 Management Fee 289 3.0 343 3.0 374 3.0 385 3.0 396 3.0 408 3.0 421 3.0 433 3.0 446 3.0 460 3.0 INCOME BEFORE NON-OPR. INC. & EXP. 2,758 28.5 3,933 34.5 4,592 36.8 4,731 36.8 4,872 36.8 5,018 36.8 5,169 36.8 5,324 36.8 5,484 36.8 5,649 36.8

NON-OPERATING INCOME & EXPENSE
Property Taxes 485 5.0 495 4.3 505 4.1 515 4.0 525 4.0 535 3.9 546 3.9 557 3.9 568 3.8 580 3.8 Insurance 101 1.0 104 0.9 107 0.9 110 0.9 113 0.9 117 0.9 120 0.9 124 0.9 127 0.9 131 0.9 Retail Income (310) (3.2) (320) (2.8) (329) (2.6) (339) (2.6) (349) (2.6) (360) (2.6) (370) (2.6) (382) (2.6) (393) (2.6) (405) (2.6) Total Expenses 275 2.8 279 2.4 282 2.4 286 2.3 289 2.3 292 2.2 296 2.2 299 2.2 303 2.1 306 2.1 EBITDA 2,483 25.7 3,654 32.1 4,310 34.4 4,445 34.5 4,583 34.5 4,726 34.6 4,873 34.6 5,025 34.6 5,181 34.7 5,343 34.7 Reserve for Replacement 193 2.0 343 3.0 498 4.0 513 4.0 529 4.0 544 4.0 561 4.0 578 4.0 595 4.0 613 4.0 EBITDA LESS RESERVE $2,290 23.7 % $3,311 29.1 % $3,812 30.4 % $3,932 30.5 % $4,055 30.5 % $4,181 30.6 % $4,312 30.6 % $4,447 30.6 % $4,587 30.7 % $4,730 30.7 % % of
Gross
o
Packet Pg. 383
Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 36 Our positioning of each revenue and expense level is supported by comparable operations or trends specific to this market.

FIGURE 4-31 COMPARABLE OPERATING STATEMENTS: RATIO TO SALES Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2017/18 2017 2017 2016 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 200 to 260 160 to 200 210 to 260 250 to 320 120 to 160 150 Days Open: 365 365 365 365 365 365
Occupancy: 88% 81% 85% 81% 75% 80%
Average Rate: $178 $185 $178 $180 $201 $191
RevPAR: $156 $150 $152 $145 $151 $153

REVENUE
Rooms 82.1 % 83.7 % 81.5 % 66.4 % 79.8 % 79.6 %
Food & Beverage 16.1 15.1 17.3 27.7 17.3 18.8
Other Operated Departments 1.3 0.3 0.8 4.9 0.1 1.3
Miscellaneous Income 0.5 0.9 0.4 1.0 2.8 0.4
Total 100.0 100.0 100.0 100.0 100.0 100.0
DEPARTMENTAL EXPENSES*
Rooms 20.7 20.1 26.7 23.5 23.0 23.0
Food & Beverage 63.4 75.8 81.9 62.6 89.5 80.0
Other Operated Departments 41.4 218.6 40.0 29.2 74.3 50.0 Total 27.7 29.0 36.2 34.4 33.9 33.9
DEPARTMENTAL INCOME 72.3 71.0 63.8 65.6 66.1 66.1

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 7.0 8.1 7.8 7.5 8.3 6.9
Info. and Telecom. Systems 0.1 0.9 1.0 0.0 1.6 0.7
Marketing 6.3 7.1 7.1 7.8 5.9 5.9
Franchise Fee 7.8 6.5 3.0 5.5 0.0 7.6
Property Operations & Maintenance 3.1 2.5 4.9 3.4 3.8 2.6 Utilities 3.0 3.8 4.0 3.9 2.7 2.6
Total 27.3 29.0 27.8 28.1 22.2 26.2
GROSS OPERATING PROFIT 45.0 42.0 36.0 37.5 43.9 39.9
Management Fee 3.0 2.5 5.0 3.0 3.0 3.0
INCOME BEFORE NON-OPER. INC. & EXP. 42.0 39.6 31.0 34.5 40.8 36.9 EBITDA LESS RESERVE 31.1 % 35.9 % 25.7 % 25.0 % 32.9 % 30.6 % * Departmental expense ratios are expressed as a percentage of departmental revenues Stabilized $
o
Packet Pg. 384 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 37 FIGURE 4-32 COMPARABLE OPERATING STATEMENTS: AMOUNTS PER AVAILABLE ROOM Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2017/18 2017 2017 2016 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 200 to 260 160 to 200 210 to 260 250 to 320 120 to 160 150 Days Open: 365 365 365 365 365 365
Occupancy: 88% 81% 85% 81% 75% 80%
Average Rate: $178 $185 $178 $180 $201 $191
RevPAR: $156 $150 $152 $145 $151 $153

REVENUE
Rooms $57,028 $54,806 $55,610 $52,969 $55,184 $55,737
Food & Beverage 11,165 9,874 11,796 22,084 11,975 13,140 Other Operated Departments 925 227 540 3,911 42 876
Mis cellaneous Income 337 601 259 808 1,918 292
Total 69,455 65,509 68,205 79,772 69,119 70,045

DEPARTMENTAL EXPENSES
Rooms 11,783 11,023 14,840 12,428 12,696 12,820
Food & Beverage 7,076 7,483 9,665 13,835 10,712 10,512
Other Operated Departments 383 497 216 1,143 31 438
Total 19,242 19,003 24,720 27,406 23,440 23,770
DEPARTMENTAL INCOME 50,213 46,506 43,485 52,367 45,680 46,276

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 4,859 5,300 5,313 6,016 5,706 4,800 Info. and Telecom. Systems 47 584 656 25 1,108 500
Marketing 4,406 4,662 4,863 6,187 4,103 4,100
Franchise Fee 5,446 4,262 2,030 4,386 0 5,295
Property Operations & Maintenance 2,155 1,641 3,362 2,679 2,622 1,800 Utilities 2,051 2,521 2,739 3,126 1,838 1,850
Total 18,963 18,970 18,963 22,420 15,378 18,345
GROSS OPERATING PROFIT 31,250 27,536 24,522 29,947 30,302 27,931 Management Fee 2,084 1,620 3,390 2,393 2,073 2,101
INCOME BEFORE NON-OPER. INC. & EXP. 29,167 25,915 21,132 27,554 28,229 25,830 EBITDA LESS RESERVE $21,622 $23,465 $17,501 $19,969 $22,786 $21,441 Stabilized $
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Packet Pg. 385 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 38 FIGURE 4-33 COMPARABLE OPERATING STATEMENTS: AMOUNTS PER OCCUPIED ROOM Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Subject
Year: 2019 2017/18 2017 2017 2016 2019
Edition: 11 11 11 11 11 11
Number of Rooms: 200 to 260 160 to 200 210 to 260 250 to 320 120 to 160 150 Days Open: 365 365 365 365 365 365
Occupancy: 88% 81% 85% 81% 75% 80%
Average Rate: $178 $185 $178 $180 $201 $191
RevPAR: $156 $150 $152 $145 $151 $153

REVENUE
Rooms $178.21 $184.78 $178.35 $179.61 $200.77 $190.88
Food & Beverage 34.89 33.29 37.83 74.88 43.57 45.00
Other Operated Departments 2.89 0.77 1.73 13.26 0.15 3.00 Miscellaneous Income 1.05 2.03 0.83 2.74 6.98 1.00
Total 217.05 220.87 218.74 270.49 251.46 239.88

DEPARTMENTAL EXPENSES
Rooms 36.82 37.16 47.59 42.14 46.19 43.90
Food & Beverage 22.11 25.23 31.00 46.91 38.97 36.00
Other Operated Departments 1.20 1.67 0.69 3.88 0.11 1.50 Total 60.13 64.07 79.28 92.93 85.28 81.40
DEPARTMENTAL INCOME 156.92 156.80 139.46 177.56 166.19 158.48

UNDISTRIBUTED OPERATING EXPENSES
Administrative & General 15.19 17.87 17.04 20.40 20.76 16.44 Info. and Telecom. Systems 0.15 1.97 2.10 0.09 4.03 1.71 Marketing 13.77 15.72 15.60 20.98 14.93 14.04
Franchise Fee 17.02 14.37 6.51 14.87 0.00 18.13
Property Operations & Maintenance 6.73 5.53 10.78 9.08 9.54 6.16 Utilities 6.41 8.50 8.78 10.60 6.69 6.34
Total 59.26 63.96 60.82 76.02 55.95 62.82
GROSS OPERATING PROFIT 97.66 92.84 78.64 101.54 110.24 95.65 Management Fee 6.51 5.46 10.87 8.11 7.54 7.20
INCOME BEFORE NON-OPER. INC. & EXP. 91.15 87.37 67.77 93.43 102.70 88.46 EBITDA LESS RESERVE $67.57 $79.11 $56.13 $67.71 $82.90 $73.43 Stabilized $
In conclusion, our analysis reflects a profitable operation, with net income expected to total 30.5% of total revenue by the stabilized year. The stabilized total revenue comprises primarily rooms revenue, with a secondary portion derived from other income sources. On the cost side, departmental expenses total 33.9% of revenue by the stabilized year, while undistributed operating expenses total

26.3% of total revenues; this assumes that the proposed subject property will be operated competently by a well-known hotel operator. After a 3.0% of total revenues management fee, a net income ratio of 34.7% is forecast by the stabilized year.
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Packet Pg. 386 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 39 FIGURE 4-34 DISCOUNTED CASH FLOW FOR FEASIBILITY CALCULATION 3 10.0 %

8.5 3.0
Discounted
Year 10% Cash Flow
2023/24 $2,774,603 $485,062 $2,289,542 0.90909 $2,081,402 2024/25 3,806,092 494,763 3,311,330 0.82645 2,736,636
2025/26 4,316,484 504,658 3,811,826 0.75131 2,863,881
2026/27 4,446,530 514,751 3,931,779 0.68301 2,685,458
2027/28 4,579,737 525,046 4,054,690 0.62092 2,517,644
2028/29 4,716,798 535,547 4,181,251 0.56447 2,360,207
2029/30 4,858,302 546,258 4,312,044 0.51316 2,212,760
2030/31 5,004,051 557,183 4,446,867 0.46651 2,074,496
2031/32 5,154,172 568,327 4,585,845 0.42410 1,944,846
2032/33 5,308,797 579,693 66,942,691 * 0.38554 25,809,305 Estimated Market Value $47,286,635
(SAY) $47,300,000
Per Room 320,000
Reversion Analysis
$5,468,061
Capitalization Rate (loaded with ta x rate) 8.5%
Total Sales Proceeds $64,137,719
Less: Tra nsaction Costs @ 3.0% 1,924,132
Net Sales Proceeds (Say) 62,213,587
11th Year's EBITDA Less Reserves (not
*10th year NOI after taxes, plus the reversionary value.

Stabilized Year
Discount Rate
Loa ded Terminal Cap
Transaction Costs
Net Income,
Before Taxes
Property
Taxes
Net Income,
After Taxes
Discount Factor @
Our discounted cash flow analysis indicates a net present value for the proposed subject property of $47,300,000 or $320,000 per room.

Feasibility Analysis
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Packet Pg. 387 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 40 The below cost estimates are derived from the 2020 HVS Development Cost Survey, as well as our market and industry knowledge.

FIGURE 4-35 COST COMPARABLES
Item
Building $287,295 72.4 % $238,879 75.3 % $267,715 73.5 % $206,118 81.1 % Soft Costs 47,666 12.0 46,300 14.6 30,298 8.3 31,986 12.6 Furniture, Fixtures , & Equipment 32,116 8.1 17,857 5.6 44,371 12.2 16,000 6.3 Pre-Opening Cos ts & Working Capital 24,450 6.2 14,286 4.5 11,921 3.3 0 0.0 Developer Fee (if Applicable) 5,503 1.4 0 0.0 9,934 2.7 0 0.0 Total (Excluding Site Cost) $397,030 93.4 % $317,321 91.9 % $364,238 92.8 % $254,104 100.0 % Site Cost $28,090 6.6 % $27,939 8.1 % $28,146 7.2 % $0 0.0 % Total (Including Site Cost) $425,120 100.0 % $345,261 100.0 % $392,384 100.0 % $254,104 100.0 % Comp #1 Comp #2 Comp #3 Comp #4
Primary, CA Secondary, CA Secondary, CA Primary, CA
Full-Service Full-Service Full-Service Full-Service
Approx. 180 Rooms Approx. 140 Rooms Approx. 150 Rooms Approx. 130 Rooms Per Room % of Total Per Room % of Total Per Room % of Total Per Room % of Total FIGURE 4-36 HVS DEVELOPMENT COST POSITIONING – UPPER UPSCALE Item
Building $206,118 72.4 % $287,295 81.1 % $250,002 75.6 % $250,000 67.3 % Soft Costs 30,298 8.3 47,666 14.6 39,063 11.9 40,000 10.8 Furniture, Fixtures , & Equipment 16,000 5.6 44,371 12.2 27,586 8.0 35,000 9.4 Pre-Opening Cos ts & Working Capital 0 0.0 24,450 6.2 12,664 3.5 12,000 3.2 Developer Fee (if Applicable) 0 0.0 9,934 2.7 3,859 1.4 5,000 1.3 Tota l (Excluding Site Cos t) $254,104 $397,030 $333,174 $342,000 92.1 % Site Cost $0 0.0 % $28,146 8.1 % 21,044 7.3 % $29,333 7.9 % Total (Including Site Cost) $254,104 $425,176 $354,217 $371,333 100.0 % Average Subject Property
Per Room % of Total Per Room % of Total Per Room % of Total Per Room % of Total Minimum Maximum
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Packet Pg. 388 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Upper-Upscale Analysis
Proposed Laguna Hills Hotel – Laguna Hills, California 41 FIGURE 4-37 HVS DEVELOPMENT COST ESTIMATE – UPPER UPSCALE Item
Building $250,000 $37,500,000
Soft Costs 40,000 6,000,000
Furniture, Fixtures, & Equipment 35,000 5,250,000
Pre-Opening Costs & Working Capital 12,000 1,800,000
Developer Fee (if Applicable) 5,000 750,000
Land 29,333 4,400,000
Total Cost New Before Incentive $371,000 $55,700,000
Cost per Room Cost
The derived net present value of $47,300,000 is -15.1% below the estimated replacement cost of $55,700,000.

Based on our market analysis, there is insufficient market support for the proposed, upper-upscale, full-service hotel scenario. Our assumption of replacement cost was developed utilizing development costs from comparable full-service properties in California, derived from the 2020 HVS Development Cost Survey. We have utilized a discounted cash flow (DCF) analysis to come to our conclusion of value upon completion of the project. The when-complete value is notably below the assumed replacement cost, deeming the project not feasible.

This analysis indicates that a hotel development of this caliber or higher is not feasible at this time in this market.
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Packet Pg. 389 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Method of Study & Statement of Assumptions and Limiting Conditions Proposed Laguna Hills Hotel – Laguna Hills, California 42

5. Method of Study & Statement of Assumptions and
Limiting Conditions
The methodology used to develop this study is based on the market research and valuation techniques set forth in the textbooks authored by HVS for the American Institute of Real Estate Appraisers and the Appraisal Institute, entitled The Valuation of Hotels and Motels,2 Hotels, Motels and Restaurants: Valuations and Market Studies,3 The Computerized Income Approach to Hotel/Motel Market Studies and Valuations,4 and Hotels and Motels: A Guide to Market Analysis, Investment Analysis, and Valuations.5

1. The subject site has been evaluated from the viewpoint of its physical utility for the future operation of a hotel, as well as access, visibility, and other relevant location factors.

2. The surrounding economic environment, on both an area and neighborhood level, has been reviewed to identify specific hostelry-related economic and demographic trends that may have an impact on future demand for hotels.

3. Dividing the market for transient accommodations into individual segments defines specific market characteristics for the types of travelers expected to utilize the area's hotels. The factors investigated include purpose of visit, average length of stay, required facilities and amenities, seasonality, daily demand fluctuations, and price sensitivity.

4. An analysis of existing and proposed competition provides an indication of the current accommodated demand, along with market penetration and the degree of competitiveness.
2 Stephen Rushmore, The Valuation of Hotels and Motels. (Chicago: American Institute of Real Estate Appraisers, 1978).
3 Stephen Rushmore, Hotels, Motels and Restaurants: Valuations and Market Studies. (Chicago: American Institute of Real Estate Appraisers, 1983). 4 Stephen Rushmore, The Computerized Income Approach to Hotel/Motel Market Studies and Valuations. (Chicago: American Institute of Real Estate Appraisers, 1990). 5 Stephen Rushmore, Hotels and Motels: A Guide to Market Analysis, Investment Analysis, and Valuations. (Chicago: Appraisal Institute, 1992).

Method of Study
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Packet Pg. 390 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Method of Study & Statement of Assumptions and Limiting Conditions Proposed Laguna Hills Hotel – Laguna Hills, California 43

5. The subject property's proposed improvements have been evaluated or recommended for optimal capture of demand in this market and at the subject site’s location.

6. Documentation for an occupancy and average rate projection is derived utilizing the build-up approach based on an analysis of lodging activity.

7. A detailed projection of income and expense made in accordance with the Uniform System of Accounts for the Lodging Industry sets forth the anticipated economic benefits of the subject property.

The subject property was inspected by Marc Greeley on November 9, 2021

1. This report is set forth as a summary of findings only for a market study of the proposed subject hotel; this is not an appraisal report.

2. This report is to be used in whole and not in part.

3. No responsibility is assumed for matters of a legal nature, nor do we render any opinion as to title, which is assumed marketable and free of any deed restrictions and easements. The property is evaluated as though free and clear unless otherwise stated.

4. We assume that there are no hidden or unapparent conditions of the subsoil or structures, such as underground storage tanks, that would affect the property’s development potential. No responsibility is assumed for these conditions or for any engineering that may be required to discover them.

5. We have not considered the presence of potentially hazardous materials or any form of toxic waste on the project site. We are not qualified to detect hazardous substances and urge the client to retain an expert in this field if desired.

6. The Americans with Disabilities Act (ADA) became effective on January 26, 1992. We have assumed the proposed hotel would be designed and constructed to be in full compliance with the ADA.

7. We have made no survey of the site, and we assume no responsibility in connection with such matters. Sketches, photographs, maps, and other exhibits are included to assist the reader in visualizing the property. It is assumed that the use of the described real estate will be within the boundaries of the property described, and that no encroachment will exist.

8. All information, financial operating statements, estimates, and opinions obtained from parties not employed by TS Worldwide, LLC are assumed true and correct. We can assume no liability resulting from misinformation.

Date of Inspection
Statement of
Assumptions and
Limiting Conditions
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Packet Pg. 391 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Method of Study & Statement of Assumptions and Limiting Conditions Proposed Laguna Hills Hotel – Laguna Hills, California 44

9. Unless noted, we assume that there are no encroachments, zoning violations, or building violations encumbering the subject site.

10. The property is assumed to be in full compliance with all applicable federal, state, local, and private codes, laws, consents, licenses, and regulations (including the appropriate liquor license if applicable), and that all licenses, permits, certificates, franchises, and so forth can be freely renewed or transferred to a purchaser.

11. All mortgages, liens, encumbrances, leases, and servitudes have been disregarded unless specified otherwise.

12. None of this material may be reproduced in any form without our written permission, and the report cannot be disseminated to the public through advertising, public relations, news, sales, or other media.

13. We are not required to give testimony or attendance in court because of this analysis without previous arrangements and shall do so only when our standard per-diem fees and travel costs have been paid prior to the appearance.

14. If the reader is making a fiduciary or individual investment decision and has any questions concerning the material presented in this report, it is recommended that the reader contact us.

15. We take no responsibility for any events or circumstances that take place subsequent to the date of our field inspection.

16. The quality of a lodging facility's onsite management has a direct effect on a property's economic viability. The financial forecasts presented in this analysis assume responsible ownership and competent management. Any departure from this assumption may have a significant impact on the projected operating results.

17. The estimated operating results presented in this report are based on an evaluation of the overall economy, and neither consider nor make provision for the effect of any sharp rise or decline in local or national economic conditions. To the extent that wages and other operating expenses may advance during the economic life of the property, we expect that the prices of rooms, food, beverages, and services will be adjusted to at least offset those advances. We do not warrant that the estimates will be attained, but they have been prepared based upon information obtained during the course of this study and are intended to reflect the expectations of a typical hotel investor.

18. This analysis assumes continuation of all provisions of the Internal Revenue Code of 1986, as amended to date.
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Packet Pg. 392 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) December-2021 Method of Study & Statement of Assumptions and Limiting Conditions Proposed Laguna Hills Hotel – Laguna Hills, California 45

19. Many of the figures presented in this report were generated using sophisticated computer models that make calculations based on numbers carried out to three or more decimal places. In the interest of simplicity, most numbers have been rounded to the nearest tenth of a percent. Thus, these figures may be subject to small rounding errors.

20. It is agreed that our liability to the client is limited to the amount of the fee paid as liquidated damages. Our responsibility is limited to the client; the use of this report by third parties shall be solely at the risk of the client and/or third parties. The use of this report is also subject to the terms and conditions set forth in our engagement letter with the client.

21. Evaluating and comprising financial forecasts for hotels is both a science and an art. Although this analysis employs various mathematical calculations to provide value indications, the final forecasts are subjective and may be influenced by our experience and other factors not specifically set forth in this report.

22. This study was prepared by TS Worldwide, LLC. All opinions, recommendations, and conclusions expressed during the course of this assignment are rendered by the staff of TS Worldwide, LLC as employees, rather than as individuals.
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Packet Pg. 393 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 1 Luigi Major, MAI

HVS CONSULTING AND VALUATION SERVICES
Los Angeles, California
BS – Hotel & Restaurant Management, University of Houston Other Specialized Training Classes Completed:

Uniform Standards of Professional Appraisal Practice – 15 hours Basic Appraisal Procedures – 30 hours
Basic Appraisal Principles – 30 hours
General Appraiser Income Approach (Parts I and II) – 60 hours General Appraiser Sales Comparison Approach – 30 hours
General Appraiser Market Analysis and HBU – 30 hours
General Appraiser Site Valuation and Cost Approach – 30 hours General Appraiser Report Writing and Case Studies – 30 hours Business Practices and Ethics – 7 hours
Statistics, Modeling and Finance – 15 hours
Advanced Income Capitalization – 40 hours
Advanced Sales Comparison & Cost Approach – 40 hours
Report Writing and Valuation Analysis – 40 hours
Advanced Applications – 40 hours
Fundamentals of Separating Real, Personal Property, and Intangible Business Assets – 15 hours
General Demonstration Report Writing
The Appraiser as an Expert Witness: Preparation and Testimony – 16 hours California Law – 4 hours
Mortgage Fraud – Protect Yourself – 7 hours
Supervisor Trainee Course for Texas – 7 hours
Appraisal of Land Subject to Ground Lease – 7 hours
Basic Hotel Appraising – 7 hours
Advanced Hotel Appraising – 7 hours
Appraisal of Land Subject to Ground Lease – 7 hours
CA Supervisor/Trainee – 4 hours
The Dirty Dozen – 3 hours

EMPLOYMENT
2007 to present
EDUCATION AND OTHER

TRAINING
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Packet Pg. 394 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 2 Income Approach – 7 hours
Small Hotel/Motel Valuation – 7 hours
NV Law – 3 hours
Basics of Expert Witness – 7 hours
Appraisal of Owner-Occupied Commercial Properties – 7 hours CA Law – 4 hours
Biennial USPAP Updates
Arizona, California, Hawaii, Nevada, Texas
Appraisal Institute – Designated Member (MAI)
“COVID-19’s Impact on the Los Angeles Hotel Market,” April 2021 “U.S. Hotel Development Cost Survey 2020,” October 2020 “Impact of COVID-19 on the Tucson Hotel Market,” July 2020 “Impact of COVID-19 on Los Angeles & Southern California Hotel Markets,” April 2020 “U.S. Hotel Development Cost Survey 2018/19,” September 2019 “Market Pulse: Los Angeles, CA,” March 2019
“HVS Hotel Development Cost Survey 2017/18,” November 2018 “Blurred Lines between Hotels and Airbnb,” September 2018 “Market Pulse: Palm Springs & Desert Cities,” February 2018 “Top 6 Hotel Success Factors,” August 2017
“In Focus: Houston, Texas,” February 2016
“Four Key Takeaways: Meet the Money 2015,” co-authored with Li Chen and Susan Furbay, May 2015
“In Focus: Houston, Texas,” co-authored with Yimei Tang, July 2014 “Effects of Major Renovations on Hotel Market Penetration and Net Present Value,” February 2014
“HVS Market Intelligence Report 2013: Houston,” June 2013

EDUCATION
(CONTINUED)
STATE CERTIFICATIONS

PROFESSIONAL

AFFILIATIONS
PUBLISHED ARTICLES
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
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Packet Pg. 395 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 3 “HVS Market Intelligence Report: Houston Hotels in 2012,” April 2012 “HVS Report: Foreign Direct Investment, Commercial Real Estate, and Hotel Development in Mexico City.” Co-authored by Raul Duarte and Richard Katzman, February 2011 “San Miguel de Allende – A Beacon for the Tourism Potential of Colonial Towns and Villages,” January 2009
“Mexico’s Growing Trend: Master-Planned Resort-Residential Communities,” November 2008
“Guadalajara – Preparing for the Future,” May 2008
“HVS Market Intelligence Report: San Juan, Puerto Rico,” November 2007 “HVS Market Intelligence Report: Liberia, Costa Rica,” September 2007 HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
HVS Journal
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Packet Pg. 396 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 4 EXAMPLES OF PROPERTIES APPRAISED
OR EVALUATED

PORTFOLIO ANALYSIS
Portfolio of 6 Embassy Suites Hotels,
Various Locations
Portfolio of 5 Proposed Hotels,
Colombia
Ladder Capital Portfolio of 6 Hotels,
Colorado and Texas
Ladder Capital Package of 4 Hotels,
Texas
Portfolio of 8 Embassy Suites Hotels,
Various Locations
Lone Star Portfolio of 38 Hyatt Hotels,
Various Locations
Portfolio of 13 Hotels for JPMorgan
Chase, Texas and New Mexico
Portfolio of 5 Extended-Stay Hotels
throughout the South
Portfolio of 3 Hotels, San Diego
Portfolio of 2 Full-Service Hotels,
Houston
Portfolio of 8 Marriott or Embassy
Suites Hotels, California and Nevada
Portfolio of 2 Proposed Hotels, Mesa,
Arizona
Portfolio of 2 Ayres Hotels, Southern
California
Portfolio of 2 Hotels, Beverly Hills

ALABAMA
Hampton Inn, Birmingham
City Lodge, Florence
Holiday Inn, Hoover
Hampton Inn, Pell City

ARIZONA
Proposed EVEN Hotel Avondale,
Avondale
Proposed Home2 Suites by Hilton,
Avondale
Proposed Hotel, Campe Verde
Holiday Inn, Casa Grande
Proposed Limited-Service Hotel at the
Promenade, Casa Grande
Proposed Hotel near Gilbert Heritage
District, Gilbert
Proposed SpringHill Suites by
Marriott, Lake Havasu
Proposed Hotel near Harrah's Ak-Chin
Casino, Maricopa
Proposed La Quinta Maricopa,
Maricopa
Proposed Hotel, Mesa
Proposed Hotel near Phoenix Mesa
Gateway Airport, Mesa
Proposed Resort Page, Page
Courtyard Phoenix Airport, Phoenix
Four Points by Sheraton Phoenix
North, Phoenix
Proposed Dual-Brand AC/Element,
Phoenix
Proposed Hampton Inn at Metro
Center, Phoenix
Proposed Holiday Inn Express &
Suites - Phoenix Airport North,
Phoenix
Proposed Home2 Suites by Hilton
Phoenix Airport North, Phoenix
Proposed Hotel at Park Central Mall,
Phoenix
Proposed Hotel Central Station,
Phoenix
Proposed Hyatt Place Downtown
Phoenix, Phoenix
Proposed La Quinta - BannerUniversity Medical Center, Phoenix Proposed La Quinta Inn & Suites
McDowell Road, Phoenix
Proposed Marriott Tribute, Phoenix
Proposed Midtown Hotel, Phoenix
Proposed WoodSpring Suites Happy
Valley, Phoenix
Ramada, Phoenix
Red Roof Inn Phoenix Bell Road,
Phoenix
Residence Inn by Marriott at Mayo
Clinic, Phoenix
Proposed Quartzsite Limited-Service
Hotel, Quartzsite
Proposed Hotel, Queen Creek
Proposed Hotel, Rancho Sahuarita
Navajoland Inn & Suites / Saint
Michaels Arizona, Saint Michaels
Proposed Ceasars Hotel at Scottsdale
Fashion Square, Scottsdale
Proposed Hilton Hotel at Cavasson,
Scottsdale
Proposed Holiday Inn, Scottsdale
Proposed Hyatt Place and Hyatt
House Dual-Branded Hotel,
Scottsdale
Talking Stick Resort, Scottsdale
Las Posadas of Sedona, Sedona
Aloft, Tempe
Comfort Suites Airport, Tempe
MOXY Phoenix Tempe/ASU Area,
Tempe
Proposed Full-Service Hotel, Tempe
Proposed Residence Inn by Marriott,
Tempe
Proposed Westin Tempe, Tempe
Proposed Best Western, Topock
Four Points by Sheraton Tucson
Airport, Tucson
Proposed Graduate Hotel Tucson,
Tucson
Proposed Hotels at the Marketplace,
Tucson
Radisson Suites, Tucson
Westin La Paloma Resort & Spa,
Tucson
Proposed Grand Canyon Resort,
Tusayan
Grand Canyon Railway Hotel,
Williams

ARKANSAS
Proposed Hotel, Fairfield Bay
Proposed Hotel, Hot Springs
La Quinta Inn & Suites, Russellville

CALIFORNIA
Proposed Hotel Adelanto, Adelanto
Proposed Holiday Inn Express
Alameda, Alameda
Alhambra Inn & Suites, Alhambra
Fremont Inn, Alhambra
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Packet Pg. 397 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 5 Proposed Hotel American Canyon,
American Canyon
Candlewood Suites Anaheim - Resort
Area, Anaheim
Four Points by Sheraton, Anaheim
Gaia Hotel & Spa, Anderson
Apple Valley Lodge, Apple Valley
Best Western, Bakersfield
Proposed Best Western Bakersfield,
Bakersfield
Proposed Staybridge Suites,
Bakersfield
Holiday Inn Express Hotel & Suites
Barstow Outlet Center, Barstow
Proposed Dual-Branded Marriott,
Barstow
Hampton Inn & Suites Buellton/Santa
Ynez Valley, Buellton
Proposed Aloft Buena Park, Buena
Park
Proposed Stanford Hotel, Buena Park
The Hotel at the Source, Buena Park
Quality Inn Burbank, Burbank
Proposed Cabazon Glamping
Recreation Center, Cabazon
DoubleTree by Hilton Golf Resort
Palm Springs Area, Cathedral City
Staybridge Suites Cathedral City Golf
Resort, Cathedral City
Proposed Gaylord Pacific Resort &
Convention Center, Chula Vista
Motel 6 Coalinga East, Coalinga
Proposed Everhome Suites Corona,
Corona
Proposed Boutique Hotel, Diablo
Grande
Proposed Hampton Inn, Diamond Bar
Proposed Select Service Hotel
Downey, Downey
Proposed Home 2 Suites by Hilton, El
Centro
Proposed Residence Inn El Centro, El
Centro
Proposed Hotel El Dorado Hills, El
Dorado Hills
Holiday Inn Express, Elk Grove
Proposed Candlewood Suites, Elk
Grove
Hyatt Place, Emeryville
Proposed Home2 Suites by Hilton,
Fairfield
La Quinta Inn & Suites, Fresno
San Joaquin Hotel, Fresno
Proposed Tapestry Collection by
Hilton Fullerton, Fullerton
Hampton Inn, Goleta
Holiday Inn Express, Grover Beach
Home2 Suites by Hilton Hanford
Lemoore, Hanford
Proposed Home2 Suites, Hanford
Proposed Dual-Branded Hotel,
Hawthorne
TownePlace Suites by Marriott Los
Angeles LAX Hawthorne,
Hawthorne
Proposed Hotel, Hermosa Beach
Proposed Kokoro Wellness Resort,
Howard Springs
Paséa Hotel & Spa, Huntington Beach
Miramonte Indian Wells Resort & Spa
Curio Collection by Hilton, Indian
Wells
Irvine Marriott, Irvine
Holiday Inn San Diego La Mesa, La
Mesa
Best Western Laguna Brisas Spa
Hotel, Laguna Beach
Coast Inn, Laguna Beach
Pacific Edge Hotel, Laguna Beach
Seaside Laguna Inn & Suites, Laguna
Beach
Hilton Garden Inn, Lompoc
Hampton Inn Long Beach Airport,
Long Beach
Proposed Breakers Hotel Long Beach,
Long Beach
Dixie Hollywood Hotel, Los Angeles
hClub, Los Angeles
InterContinental Los Angeles
Downtown, Los Angeles
Loews Hollywood, Los Angeles
Mr C Beverly Hills, Los Angeles
Proposed Found Santa Monica, Los
Angeles
Proposed Hampton Inn & Suites
Koreatown, Los Angeles
Proposed Hotel Koreatown, Los
Angeles
Proposed Hyatt Place Olive Street, Los
Angeles
Proposed Spring Street Hotel, Los
Angeles
Proposed SpringHill Suites by
Marriott, Marina
Proposed Staybridge Suites Los
Angeles, Los Angeles
Proposed Unscripted Hotel, Los
Angeles
Proposed Wellness Hotel Malibu,
Malibu
Proposed Hotel Mammoth Village,
Mammoth Lakes
Proposed Resort Mammoth Lakes,
Mammoth Lakes
Proposed Hampton Inn & Suites,
Marina
Best Western, Merced
Mountain Home Inn, Mill Valley
Proposed Montebello Hotel,
Montebello
Comfort Inn & Suites Temecula Wine
Country, Murrieta
Best Western Elm House Inn, Napa
Hampton by Hilton Napa, Napa
Aloft Silicon Valley, Newark
TownePlace Suites by Marriott,
Newark
Proposed Hotel North Hollywood,
North Hollywood
Proposed Select-Service Hotel,
Northridge
Proposed Homage Oakland, Oakland
Courtyard by Marriott Oceanside,
Oceanside
Proposed Cambria Hotel Ontario,
Ontario
Proposed Dual-Branded Homewood
Suites by Hilton and Hampton by
Hilton Ontario, Ontario
o
Packet Pg. 398 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 6 Proposed Element by Westin Ontario,
Ontario
Proposed Dual-Branded Residence
Inn & Courtyard by Marriott
Orange, Orange
Hampton Inn Channel Islands Harbor,
Oxnard
Proposed Tru, Oxnard
Ivy Palm Resort & Spa, Palm Springs
Proposed Andaz Palm Springs, Palm
Springs
Proposed BODE: Palm Springs, Palm
Springs
Riviera Palm Springs, a Tribute
Portfolio Resort, Palm Springs
Tova Hotel & Beach Club, Palm
Springs
Travelodge Palm Springs, Palm
Springs
Holiday Inn Palmdale Lancaster,
Palmdale
Motel 6 Paso Robles, Paso Robles
Proposed Hotel Ava, Paso Robles
Proposed Patterson Hotel, Patterson
Proposed Hotel Perris, Perris
Sheraton Sonoma County Petaluma,
Petaluma
Motel 6, Pittsburg
Comfort Inn Near Fairplex Pomona,
Pomona
Comfort Inn & Suites, Rancho Cordova
Proposed Hampton Inn, Rancho
Cucamonga
Proposed Hotel at The River Mall,
Rancho Mirage
Proposed Home2 Suites, Ridgecrest
Proposed Roseville Hotel, Roseville
Courtyard by Marriott Cal Expo,
Sacramento
DoubleTree by Hilton, Sacramento
Fairfield Inn Cal Expo, Sacramento
La Quinta Inn by Wyndham
Sacramento North, Sacramento
Quality Inn & Suites, Sacramento
DoubleTree by Hilton Golf Resort, San
Diego
DoubleTree by Hilton San Diego Del
Mar, San Diego
Fairmont Grand Del Mar, San Diego
Holiday Inn Express Hotel & Suites
Otay Mesa, San Diego
Holiday Inn Express & Suites San
Diego Mission Valley, San Diego
Lafayette Hotel Swim Club &
Bungalows, San Diego
Marriott San Diego Del Mar, San Diego
The Monsaraz Inn, Tapestry
Collection by Hilton, San Diego
Proposed Fairfield Inn, San Diego
Proposed Hotel, San Diego
San Diego Marriott Del Mar, San Diego
SpringHill Suites by Marriott San
Diego Mission Valley, San Diego
US Grant, San Diego
Proposed Boutique Hotel San Dimas,
San Dimas
Holiday Inn Fisherman's Wharf San
Francisco, San Francisco
Proposed Fairfield Inn & Suites by
Marriott South San Francisco, South
San Francisco
San Jacinto Inn, San Jacinto
Proposed Hyatt Place, San Jose
Proposed Dual-Brand Hotel San
Marcos, San Marcos
Proposed La Quinta Inn & Suites, San
Pablo
Proposed AC Hotel by Marriott San
Rafael, San Rafael
Proposed Homewood Suites, Santa
Clarita
Hampton Inn, Santa Cruz
Proposed Hampton by Hilton Santa
Cruz, Santa Cruz
Holiday Inn & Suites, Santa Maria
Proper Hotel, Santa Monica
Hotel Santa Rosa, Santa Rosa
Proposed Hotel, Sonora
Sonora Inn, Sonora
Proposed Galway House, Temecula
Proposed Hampton Inn Three Rivers,
Three Rivers
Travelodge Yucca Valley, Twentynine
Palms
Embassy Suites by Hilton, Valencia
Hotel Erwin, Venice Beach
Four Points by Sheraton Ventura
Harbor Resort, Ventura
Proposed Avid Hotel Victorville,
Victorville
Marriott, Walnut Creek
Proposed Hyatt Place Walnut Creek,
Walnut Creek
Proposed Residence Inn Walnut
Creek, Walnut Creek
Proposed Home2 Suites by Hilton
Watsonville, Watsonville
Hampton Inn, West Covina
Holiday Inn West Covina, West Covina
The Charlie Hotel, West Hollywood
London West Hollywood at Beverly
Hills, West Hollywood
DoubleTree by Hilton Whittier Los
Angeles, Whittier
Comfort Suites Woodland, Woodland
Marriott Warner Center, Woodland
Hills
Proposed Staybridge Suites
Woodland, Woodland

COLORADO
Proposed Gaylord Rockies Hotel &
Convention Center, Aurora
Hyatt Summerfield Suites, Broomfield
Best Western Academy Hotel,
Colorado Springs
Proposed EVEN Hotel Victory Ridge,
Colorado Springs

DISTRICT OF COLUMBIA
Georgetown Suites Land Valuation
Proposed Maison Kesh Hotel

FLORIDA
Marriott, Boca Raton
Proposed Dual-Branded Residence
Inn/SpringHill Suites by Marriott,
Clearwater Beach
Mayfair Hotel & Spa, Coconut Grove
o
Packet Pg. 399 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 7 Hyatt Place, Delray Beach
Hyatt Place at Coconut Point, Estero
Hyatt Place, Fort Lauderdale
Hilton Garden Inn, Fort Myers
Four Points, Ft. Walton Beach
Holiday Inn, Houston
Proposed Courtyard, Jacksonville
Wyndham Riverwalk, Jacksonville
Terrace Hotel, Lakeland
Proposed Holiday Inn & Suites, Miami
Proposed Hotel, Miami
Proposed Le Meridien, Miami
Proposed Meininger Hotel, Miami
Beach
Proposed Hilton, Miami Beach
The Raleigh Hotel, Miami Beach
Proposed SpringHill Suites by
Marriott, Navarre
Embassy Suites Orlando Lake Buena
Vista, Orlando
Holiday Inn Express Hotel & Suites
Orlando International Airport,
Orlando
Proposed WoodSpring Suites, Orlando
Proposed Comfort Inn & Suites
Panama City Beach, Panama City
Beach
Sheraton Suites Fort Lauderdale
Plantation, Plantation
Proposed Hotel, St. Augustine
SpringHill Suites by Marriott, Sarasota
Sawgrass Grand Hotel & Suites,
Sunrise
Hampton Inn, Tallahassee
Hampton Inn Veterans Expressway,
Tampa

GEORGIA
Proposed Curio - A Collection by
Hilton, Alpharetta
Courtyard by Marriott, Atlanta
Holiday Inn Atlanta Perimeter
Dunwoody, Atlanta
Proposed Radisson, College Park
Country Inn & Suites, Hiram
Candlewood Suites, Lithia Springs
Proposed Full-Service Tribute Hotel,
Macon
Holiday Inn Express, St. Simons Island
Island Inn, St. Simons Island
HAWAII
Sheraton Keauhou Bay Resort & Spa,
Kailua
Proposed Kona Village, a Rosewood
Resort, Kailua-Kona
Four Seasons Resort O'ahu at Ko
Olina, Kapolei
IDAHO
Proposed Hotel Boise Airport, Boise
Proposed Economy Extended Stay,
Coeur D’Alene

ILLINOIS
Proposed Extended-Stay Hotel,
Bolingbrook
Proposed Hampton Inn, Burr Ridge
SpringHill Suites by Marriott, Burr
Ridge
Renaissance Chicago O’Hare Suites,
Chicago
SpringHill Suites by Marriott,
Elmhurst

INDIANA
Proposed Aloft, Indianapolis
IOWA
Proposed Waterpark Hotel,
Davenport
Proposed University of Iowa Hotel,
Iowa City
KANSAS
Crowne Plaza Kansas City Overland
Park, Lenexa

LOUISIANA
Proposed Residence Inn by Marriott,
Bossier City
Hampton Inn, Houma
Hotel Acadiana, Lafayette
Wyndham Garden, Lafayette
Proposed Candlewood Suites,
Leesville
Astor Crowne Plaza, New Orleans
Hilton Garden Inn French Quarter,
New Orleans
Hyatt Regency, New Orleans
Proposed Hotel Alessandra, New
Orleans
Troubadour Hotel New Orleans,
Tapestry Collection by Hilton, New
Orleans
Wyndham Chateau Bourbon, New
Orleans
Holiday Inn, Ruston
Holiday Inn Express Hotel & Suites,
Ruston
Proposed La Quinta Inn & Suites,
Ruston
Nottoway Plantation Resort, White
Castle

MARYLAND
Proposed Hilton Garden Inn,
Baltimore
Sheraton Washington North, Beltsville
Country Inn & Suites by Carlson,
Frederick
Proposed Hotel Sorella, Rockville

MINNESOTA
Loews, Minneapolis
Westin, Minneapolis

MISSISSIPPI
Four Points, Biloxi
Proposed SpringHill Suites, Biloxi
South Beach Biloxi Hotel, Biloxi
Hampton Inn, Brookhaven
Magnuson Hotel Hattiesburg, North
Hattiesburg

MISSOURI
Hilton Kansas City Airport, Kansas
City

MONTANA
o
Packet Pg. 400 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 8 Proposed Hotel, Big Sky
Proposed Hotel Gardiner, Gardiner
Proposed Best Western, Shelby
Holiday Inn Express, Sidney
NEVADA
Hampton Inn, Las Vegas
Proposed Delta Las Vegas, Las Vegas
Proposed Fairfield Inn & TownePlace
Suites Dual-Branded Hotel, Las
Vegas
Proposed Hotel Raiders Stadium, Las
Vegas
Proposed Limited/Select-Service
Hotel, Las Vegas
Vegas Vacant Land, Spring Valley

NEW JERSEY
Proposed Holiday Inn, Bayonne
TownePlace Suites by Marriott, Mount
Laurel
Holiday Inn, Princeton

NEW MEXICO
Proposed Home2 by Hilton
Alamogordo, Alamogordo
Proposed Downtown Hotel,
Albuquerque
Proposed TownePlace Suites
Albquerque, Albuquerque
Sleep Inn & Suites, Hobbs
Proposed La Quinta Inn, Los Lunas
Holiday Inn Express, Portales
Proposed Hotel, Ruidoso
Hotel Santa Fe, Santa Fe
Inn at Loretto, Santa Fe
Proposed Boutique Hotel, Santa Fe
Hampton Inn, Santa Rosa
Holiday Inn Express, Santa Rosa
La Quinta Inn, Santa Rosa
Sagebrush Inn, Taos

NEW YORK
Marriott, Buffalo
Proposed Hampton Inn, Dewitt
Courtyard by Marriott New York
LaGuardia Airport, East Elmhurst
Proposed Tryp by Wyndham Long
Island City, Long Island City
Residence Inn, White Plains
Proposed Selina Woodstock,
Woodstock

NORTH CAROLINA
Proposed Fairfield Inn by Marriott,
Maggie Valley
Courtyard by Marriott, Raleigh
OHIO
Proposed Hilton, Chippewa Lake
Proposed Baldwin Hotel, Cincinnati
Holiday Inn, West Chester
Proposed Holiday Inn & Conference
Center, West Chester
Radisson Hotel at the University of
Toledo, Toledo

OKLAHOMA
Hilton Skirvin, Oklahoma City
OREGON
Hilton, Eugene

PENNSYLVANIA
DoubleTree by Hilton Pittsburgh
Garden Tree, Pittsburgh

SOUTH CAROLINA
Proposed 5-Star Hotel, Charleston
Proposed Marion Square Hotel,
Charleston
3 Palms Hotel, Myrtle Beach

TENNESSEE
Holiday Inn, Chattanooga
Proposed Select-Service Hotel,
Knoxville
Holiday Inn Memphis Downtown
Beale Street, Memphis
Proposed Dual-Brand Tru & Hampton
Inn, Nashville
TEXAS
Holiday Inn Express, Allen
Proposed 21c Hotel, Austin
Proposed Hotel Granduca, Austin
Proposed SpringHill Suites, Baytown
Value Place, Beaumont
Homewood Suites by Hilton, Bedford
Proposed Hotel Texas A&M
University, College Station
Proposed Tryp by Wyndham, College
Station
Proposed Staybridge Suites, The
Colony
Fairfield Inn & Suites Houston Conroe,
Conroe
Candlewood Suites, Corpus Christi
Comfort Suites Calallen, Corpus
Christi
Embassy Suites, Corpus Christi
Holiday Inn Airport, Corpus Christi
Holiday Inn Downtown, Corpus
Christi
Holiday Inn Express, Corpus Christi
La Quinta Inn & Suites, Corpus Christi
Proposed Schlitterbahn Resort,
Corpus Christi
Staybridge Suites, Corpus Christi
Proposed Hotel, Cypress
Le Méridien The Stoneleigh, Dallas
Proposed Aloft/Element DualBranded Hotel, Dallas
Proposed Autograph Collection
Trinity Groves, Dallas
Proposed Residence Inn by Marriott,
Dallas
Proposed Residence Inn and AC by
Marriott Dual-Branded Hotel, Dallas
Proposed Saint Elm Hotel, Dallas
Hilton Garden Inn Denison Sherman
at Texoma Event Center, Denison
Proposed Hotel, Edinburg
Proposed Hyatt Place, Edinburg
Proposed Artisan Hotel Conversion, El
Paso
Sheraton Fort Worth Downtown
Hotel, Fort Worth
Proposed Hilton Garden Inn, Frisco
Westin Stonebriar, Frisco
o
Packet Pg. 401 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 9 Sheraton Fort Worth Downtown
Hotel, Fort Worth
SpringHill Suites by Marriott Fort
Worth University, Fort Worth
Proposed Full-Service Hotel Baybrook
Mall, Friendswood
Courtyard by Marriott, Galveston
Proposed Beachfront Hotel, Galveston
Proposed Beachtown Grand Hotel,
Galveston
Proposed Courtyard by Marriott,
Galveston
Proposed Downtown Hotel, Galveston
Proposed TownePlace Suites,
Galveston
TownePlace Suites by Marriott,
Galveston
Proposed Hotel, Georgetown
Best Western Fountainview, Houston
Crowne Plaza, Houston
Crowne Plaza Suites, Houston
DoubleTree Suites by Hilton Houston
Galleria, Houston
DoubleTree IAH, Houston
Four Seasons, Houston
Hampton Inn Houston Interstate 10
West, Houston
Hampton Inn & Suites Houston
Medical Center, Houston
Hilton Garden Inn Houston Bush
Intercontinental Airport, Houston
Hilton Garden Inn Houston
Northwest, Houston
Hilton Houston North, Houston
Hilton Houston Westchase, Houston
Holiday Inn Southwest, Houston
Holiday Inn Westchase, Houston
Homewood Suites by Hilton, Houston
Hotel Icon, Houston
Hyatt Regency, Houston
Intercontinental Houston Medical
Center, Houston
Magnolia Hotel, Houston
Marriott Houston North Greenspoint,
Houston
Proposed 314 Hotel, Houston
Proposed AC Hotel Houston
Downtown, Houston
Proposed Aloft, Houston
Proposed Embassy Suites, Houston
Proposed Hampton Inn/Homewood
Suites Downtown, Houston
Proposed Heights Hotel, Houston
Proposed Holiday Inn & Conference
Center Willowbrook, Houston
Proposed Holiday Inn Downtown,
Houston
Proposed Homewood Suites by
Hilton, Houston
Proposed Hotel Alessandra, Houston
Proposed Hotel Galleria, Houston
Proposed Hotel Zaza & Apartments,
Houston
Proposed Hyatt Place and Hyatt
House Dual-Brand Hotel, Houston
Proposed Hyatt Place, Houston
Proposed InterContinental Hotel,
Houston
Proposed JW Marriott, Houston
Proposed Le Méridien, Houston
Proposed Lifestyle Hotel, Houston
Proposed Luxury Hotel Houston
Galleria, Houston
Proposed Marriott Marquis, Houston
Proposed Montrose Hotel, Houston
Proposed Select-Service Hotel,
Houston
Proposed SpringHill Suites, Houston
Proposed Triple-Branded Hotel
Houston Downtown, Houston
Sam Houston Hotel (Curio
Conversion), Houston
Sheraton Houston North, Houston
Sheraton Houston West, Houston
Staybridge Suites, Houston
Staybridge Suites Houston IAH
Beltway 8, Houston
Staybridge Suites Houston West
Energy Corridor, Houston
Staybridge Suites Houston
Willowbrook, Houston
Westin Galleria, Houston
Westin Oaks, Houston
Wingate by Wyndham Houston Bush
Intercontinental, Houston
Proposed Hotel & Conference Center,
Huntsville
Studio 6, Ingleside
Proposed Westin, Irving
Wingate Las Colinas, Irving
Sleep Inn & Suites, Jourdanton
Super 8, Karnes City
Homewood Suites by Hilton
Houston/Katy Mills Mall, Katy
Proposed Homewood Suites by
Hilton, Katy
South Shore Harbour Resort & Spa,
League City
Best Western, Luling
Renaissance, McAllen
Proposed Home2 Suites by Hilton,
McKinney
Proposed SpringHill Suites by
Marriott, McKinney
Proposed Westin, McKinney
Proposed Limited-Service Hotel,
Melissa
Proposed Extended-Stay Hotel,
Midland
Candlewood Suites, Monahans
La Toretta del Lago Resort & Spa,
Montgomery
Candlewood Suites, Odessa
Proposed Home2 Suites by Hilton,
Pasadena
Courtyard by Marriott Houston
Pearland, Pearland
Proposed Pearland Hotel, Pearland
Proposed Fairfield Inn by Marriott,
Pecos
TownePlace Suites by Marriott Plano,
Plano
Holiday Inn Express Hotel & Suites,
Port Aransas
Holiday Inn Express, Port Arthur
Proposed Hilton Garden Inn Porter,
Porter
Holiday Inn Express, Rockport
Microtel Inn & Suites, Round Rock
o
Packet Pg. 402 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 10 Proposed Holiday Inn (land), San
Angelo
Hilton San Antonio Airport, San
Antonio
Homewood Suites by Marriott, San
Antonio
Marriott Plaza, San Antonio
Microtel Inn & Suites Airport, San
Antonio
Microtel Inn & Suites SeaWorld, San
Antonio
Proposed Thompson Hotel, San
Antonio
Baymont Inn & Suites, Snyder
Proposed Fairfield Inn by Marriott,
Snyder
Schlitterbahn Resort, South Padre
Island
Proposed Home2 Suites, Stafford
Marriott Hotel and Conference Center,
Sugar Land
Proposed Red Lion Inn & Suites, Texas
City
Baymont Inn & Suites, Victoria
Proposed Hotel, Webster
Proposed Hotel & Conference Center,
Webster
Proposed Extended-Stay Hotel, The
Woodlands
Woodlands Resort & Conference
Center, The Woodlands
UTAH
Peery Hotel, Salt Lake City
Proposed Inn at St. George, St. George

VIRGINIA
Wingate Inn Dulles Airport, Chantilly
Proposed Staybridge Suites,
Charlottesville
Delta Hotels, Chesapeake
Westin Tysons Corner, Falls Church
Proposed Hampton Inn, Gordonsville
Holiday Inn, Lynchburg
Magnuson Hotel & Convention Center
at Oyster Point, Newport News
Proposed Hotel Norfolk, Norfolk
Holiday Inn Express & Suites
Petersburg Fort Lee, Petersburg
TownePlace Suites by Marriott,
Stafford

WASHINGTON
Proposed AC Hotel, Bellevue
Holiday Inn Express, Marysville
Proposed Homewood Suites, Richland
Proposed 4/C Tower Hotel, Seattle
Holiday Inn Express, Sumner

WISCONSIN
Holiday Inn, Milwaukee

INTERNATIONAL
Colombia
Proposed Hyatt Place, Bogota
Conrad, Cartagena
Proposed City Express Hotel,
Cartagena
Proposed Luxe Resort by The Charlee,
Guatape
Proposed City Express Hotel, Medellín
Proposed Courtyard by Marriott,
Medellin
Proposed Marriott, Medellín
Proposed Hilton Garden Inn, Rionegro
Proposed Airport Hotel, Rionegro
Costa Rica
Proposed Andaz, Guanacaste
Proposed Boutique Resort,
Guanacaste
Proposed Paradisus Papagayo Bay
Resort & Luxury Villas, Guanacaste
Proposed Resort, Guanacaste
Punta Cacique Proposed Resort,
Guanacaste
Proposed Boutique Resort,
Guanacaste
Proposed Limited-Service Hotel,
Liberia
Proposed Wellness Boutique Hotel,
Matapalo
Marriott Los Suenos, Playa Herradura
Proposed Extended-Stay, San Jose
Proposed Hyatt Place Pinares, San
Jose
Proposed Select-Service Hotel, San
Jose
Marriott Costa Rica, San Jose
Proposed Hyatt Place, San Jose
Proposed Lifestyle Hotel & Club, San
Jose
Proposed Luxury Hotel, San Jose
Dominican Republic
Proposed Auberge Resort, El Seibo
Proposed Four Seasons, El Seibo
El Salvador
Proposed Full-Service Hotel, San
Salvador
Proposed Select-Service Hotel, San
Salvador
Guatemala
Proposed Four Seasons, Antigua
Proposed Hotel, Guatemala City
Honduras
Proposed Hotel, San Pedro Sula
Mexico
Fairmont Acapulco Princess, Acapulco
Fairmont Pierre Marques, Acapulco
Proposed Hotel, Acapulco
Bacalar Land Parcels, Bacalar
Proposed Bacalar Hotel, Bacalar
Cabo de Cortes Fairmont/Raffles
Development, Cabo San Lucas
Cabo San Cristobal, Cabo San Lucas
Proposed Luxury Hotel & Villa Project,
Campeche
Proposed Master-Planned
Development (2), Campeche
Dreams Resort, Cancun
Elan Resort & Spa, Cancun
El Pueblito, Cancun
Fiesta Americana Condesa Cancun,
Cancun
Le Meridien, Cancun
o
Packet Pg. 403 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) HVS, Los Angeles, California Qualifications of Luigi Major, MAI 11 Yalmakan Resort, Cancun
Westin Soberano, Chihuahua
Proposed Quinta Real Hotel
Development, Culiacán
Proposed Banyan Tree, Ensenada
Proposed Boutique Hotel Project,
Guadalajara
Proposed Fiesta Inn del Tapatio,
Guadalajara
Proposed Hotel Project, Guadalajara
Proposed Mixed-Use Development,
Guadalajara
Proposed Vi Hotel, Guadalajara
Hotel Condesa, Leon, Guanajuato
Tesoro, Ixtapa
Proposed Hotel & Residential
Development, Ixtapan de la Sal
Proposed Park Hyatt, Kanai
Proposed St. Regis, Kanai
Proposed W Hotel, Kanai
Desire Resort, Los Cabos
Esperanza Resort, Los Cabos
Proposed Thompson Hotel, Los
Veneros
Tesoro Manzanillo, Manzanillo
Embassy Suites, Mexico City
Le Méridien, Mexico City
Proposed City Express Hotel, Mexico
City
Proposed Limited-Service Hotel,
Mexico City
Proposed Hotel & Condo, Monterrey
Proposed Hotel, Monterrey
Proposed Limited-Service Hotel, Playa
del Carmen
Proposed Resort, Playa del Carmen
Ceiba del Mar, Puerto Morelos
Paraiso de la Bonita, Puerto Morelos
Proposed Puerto Telchac Hotel &
Residential Project, Puerto Progreso
Presidente InterContinental, Puerto
Vallarta
Proposed City Express Hotel,
Queretaro
Proposed Capella Punta Maroma,
River Maya
Proposed Grand Hyatt, Riviera Maya
El Dorado Ranch Hotel & Excess Land,
San Felipe
Proposed Hotel, San Miguel de
Allende
Prposed Quinta Real Hotel &
Residential, San Miguel de Allende
Dreams Resort, Tulum
Secrets Capri Resort, Tulum
Panama
Proposed Boutique Hotel, Panama
City
Proposed Full-Service Hotel, Panama
City
Proposed Limited-Service Hotel,
Panama City
Peru
Proposed Hyatt Place, Lima
Puerto Rico
Hilton, Caribe
Embassy Suites San Juan Hotel &
Casino, Carolina
Proposed Boutique Hotel, Ponce
Proposed El Vigía Hotel and
Residences, a Tribute Portfolio
Resort, Ponce
Courtyard by Marriott (Expansion),
San Juan
Proposed 1,000-Room Hotel & Casino
San Juan, San Juan
Saint Lucia
Proposed Master Planned
Development
Spain
Villaitana Wellness Golf & Business
Sun Resort, Benidorm
o
Packet Pg. 404 Attachment: Attachment o - Hotel Feasibility Study, HVS, dated December 13, 2021 (2767 : Village at Laguna Hills Continued Public Hearing) ADDENDUM – COMMENTARY ON FULL-SERVICE UPSCALE FEASIBILITY Proposed Laguna Hills Hotel

LAGUNA HILLS MALL, CALLE DE LA LOUISA

LAGUNA HILLS, CALIFORNIA
SUBMITTED TO:PR OPOSED
Stephen T. Logan
Merlone Geier Partners
4365 Executive Drive, Suite 1400
San Diego, California 92121
PREPARED BY:

HVS Consulting & Valuation
Division of TS Worldwide, LLC
8430 Santa Monica Boulevard, Suite 200
West Hollywood, California 90069
+1 (310) 270-3240
December-2021
p
Packet Pg. 405 Attachment: Attachment p - Addendum to Hotel Feasibility Study, HVS, dated December 14, 2021 (2767 : Village at Laguna Hills Continued December-2021
Proposed Laguna Hills Hotel – Laguna Hills, California 2 December 14, 2021
Stephen T. Logan
Merlone Geier Partners
4365 Executive Drive, Suite 1400
San Diego, California 92121
Re: Proposed Laguna Hills Hotel
Laguna Hills, California
HVS Reference: 2021022179
Dear Mr. Logan:

Pursuant to your request, we herewith submit our response pertaining to your question on the feasibility of an upscale full-service hotel for the above-referenced project in the Laguna Hills, California, area.

As a reminder STR categorizes hotels by ADR. Therefore, an upscale full-service hotel would not be expected to have a significantly higher ADR than an upscale select-service hotel. Starting from this understanding, it would be challenging to make an upscale full-service hotel feasible if ADR levels will be relatively similar to the select-service scenario, since construction costs for the full-service scenario will be much higher.

If we take it a step further, we have in our competitive set one upscale full-service hotel, which can provide an understanding of ADR levels for this specific product.

The DoubleTree by Hilton Irvine Spectrum in our competitive achieved an ADR of ~$185 in 2019. We also have the Sonesta Laguna Hills, which is categorized as upscale, but one could argue that falls between select and full service. The Sonesta is seeking to move more toward a full-service offering. The Sonesta had an ADR of ~$145 in 2019.

Our selected ADR for the upscale select-service scenario was $175 in 2019 dollars and $205 for the upper-upscale full-service scenario. The above information means that on a best-case scenario we would be looking at an ADR of $185-$190 for upscale full-service scenario, ultimately falling between the two scenarios previously studied.

As such, the upscale full-service scenario is likely to achieve an ADR increase of $10 to $15 over the select-service scenario, or approximately 5% to 9% higher.

However, construction costs are likely to fall between the select service upscale and the full-service upper-upscale category. Development costs for select-service were about $275,000 per room and for full-service $375,000. Construction costs for a full-service hotel would be higher due to the additional requirements that arise from the inclusion of an expanded food and beverage offering as well larger meeting venues. Furthermore, the clientele and brand expectations for a fullservice property would demand a higher level of quality, which would result in higher costs associated with flooring and wall finishes, furniture, fixtures, and

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Packet Pg. 406 Attachment: Attachment p - Addendum to Hotel Feasibility Study, HVS, dated December 14, 2021 (2767 : Village at Laguna Hills Continued December-2021
Proposed Laguna Hills Hotel – Laguna Hills, California 3 equipment. As such, the development of an upscale full-service hotel is likely to fall in the middle, at approximately $325,000 or higher, or approximately 18% higher than the select-service scenario.

As illustrated in the select-service scenario, the valuation at opening was expected to be 1.5% higher than the estimated development costs. In this new upscale fullservice scenario, with ADR being 9% higher but costs at least 18% higher, the fullservice upscale scenario would not be feasible.

We hereby certify that we have no undisclosed interest in the property, and our employment and compensation are not contingent upon our findings. This memo is meant to be part of the summary of findings previously completed for the abovereferenced subject property and is subject to the comments made throughout that report and to all assumptions and limiting conditions set forth therein.

Sincerely,
TS Worldwide, LLC
Luigi Major, MAI, Managing Director
[email protected], +1 (310) 270-3240
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Packet Pg. 407 Attachment: Attachment p - Addendum to Hotel Feasibility Study, HVS, dated December 14, 2021 (2767 : Village at Laguna Hills Continued

Laguna Hills City CouncilMarch 8, 2022

Laguna Hills City Council
March 8, 2022