This Bond shall be registered in the name of the Owner hereof, as to both principal and interest, and the District and the Trustee may treat the Owner hereof as the absolute owner for all purposes and shall not be affected by any notice to the contrary.
The Bonds are issuable only in fully registered form in the denomination of $5,000 or any integral multiple thereof and may be exchanged for a like aggregate principal amount of Bonds of other authorized denominations of the same issue and maturity, all as more fully set forth in the Indenture.
This Bond is transferable by the Owner hereof, in person or by his attorney duly authorized in writing, at the Principal Office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Indenture, upon surrender and cancellation of this Bond. Upon such transfer, a new registered Bond of authorized denomination or denominations for the same aggregate principal amount of the same issue and maturity will be issued to the transferee in exchange therefor.
The Trustee shall not be required to register transfers or make exchanges of: (i) any Bonds for a period of 15 days next preceding any selection of the Bonds to be redeemed; or (ii) any Bonds chosen for redemption.
The rights and obligations of the District and of the registered owners of the Bonds may be amended at any time, and in certain cases without notice to or the consent of the registered owners, to the extent and upon the terms provided in the Indenture.
THE BONDS DO NOT CONSTITUTE GENERAL OBLIGATIONS OF THE CITY OR OF THE DISTRICT. NEITHER THE CITY NOR THE DISTRICT IS OBLIGATED TO LEVY OR
PLEDGE, OR HAS LEVIED OR PLEDGED, GENERAL OR SPECIAL TAXES, OTHER THAN THE SPECIAL TAXES REFERENCED HEREIN. THE BONDS ARE LIMITED OBLIGATIONS
OF THE DISTRICT PAYABLE FROM THE PORTION OF THE SPECIAL TAXES AND OTHER
AMOUNTS PLEDGED UNDER THE INDENTURE BUT ARE NOT A DEBT OF THE CITY, THE
STATE OF CALIFORNIA OR ANY OF ITS POLITICAL SUBDIVISIONS WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATION OR RESTRICTION.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 158
Menifee Mayor and City Council
November 6, 2024
Page
1253 of 1464
A-6
4885-4283-6967/200299-0015
This Bond shall not become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been dated and signed by the Trustee.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by law, and that the amount of this Bond, together with all other indebtedness of the District, does not exceed any debt limit prescribed by the laws or Constitution of the State of California.
IN WITNESS WHEREOF, Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee has caused this Bond to be dated the Dated Date, to be signed on behalf of the District by the Mayor of the City by his facsimile signature and attested by the facsimile signature of the City Clerk of the City.
Mayor of the City of Menifee, acting as the legislative body of Community Facilities District No. 2023-1
(Rockport Ranch) of the City of Menifee
ATTEST:
Acting City Clerk of the City of Menifee,
acting as the legislative body of Community
Facilities District No. 2023-1 (Rockport
Ranch) of the City of Menifee
[FORM OF TRUSTEE’S CERTIFICATE
OF AUTHENTICATION AND REGISTRATION]
This is one of the Bonds described in the within-defined Indenture.
Dated: _____, 2024 WILMINGTON TRUST, NATIONAL
ASSOCIATION, as Trustee
By:
Authorized Signatory
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 159
Menifee Mayor and City Council
November 6, 2024
Page
1254 of 1464
A-1
4885-4283-6967/200299-0015
[FORM OF LEGAL OPINION]
The following is a true copy of the opinion rendered by Stradling Yocca Carlson & Rauth LLP, in connection with the issuance of, and dated as of the date of the original delivery of, the Bonds. A signed copy is on file in my office.
City Clerk of the City of Menifee
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 160
Menifee Mayor and City Council
November 6, 2024
Page
1255 of 1464
A-2
4885-4283-6967/200299-0015
[FORM OF ASSIGNMENT]
For value received the undersigned do(es) hereby sell, assign and transfer unto whose tax identification number is ,
the within-mentioned registered Bond and hereby irrevocably constitute(s) and appoint(s) attorney to transfer the same on the books of the Trustee with full power of substitution in the premises.
Dated:
Signature guaranteed:
NOTE: Signature(s) must be guaranteed by an
eligible guarantor institution.
NOTE: The signatures(s) on this Assignment
must correspond with the name(s) as written on
the face of the within Bond in every particular
without alteration or enlargement or any change
whatsoever.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 161
Menifee Mayor and City Council
November 6, 2024
Page
1256 of 1464
B-1
4885-4283-6967/200299-0015
EXHIBIT B-1
FORM OF REQUISITION FOR DISBURSEMENT OF PROJECT COSTS
$______
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ROCKPORT RANCH) OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
Wilmington Trust, National Association (the “Trustee”), is hereby requested to pay from the [City Facilities][Water Facilities] Account of the Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee Acquisition and Construction Fund, established by the Bond Indenture, dated as of December 1, 2024, by and between the Trustee and Community Facilities District No. 2023- 1 (Rockport Ranch) of the City of Menifee (the “District”), the amount specified to the payee named below for payment of the Project Costs set forth in Attachment No. 1 hereto.
Payee:
Address:
Purpose:
Amount: $
The amount is due and payable under purchase order, contract or other authorization and has not formed the basis of any prior request for payment. The conditions for the release of this amount from the [City Facilities][Water Facilities] Account, including those conditions in Section 3.9(b) of the Indenture have been satisfied.
There has not been filed with nor served upon the District notice of any lien, right to lien or attachment upon, or stop notice or claim affecting the right to receive payment of the amount specified above which has not been released or will not be released simultaneously with the payment of such amount, other than materialmen’s or mechanic’s liens accruing by mere operation of law.
Dated: COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ROCKPORT RANCH) OF THE CITY OF MENIFEE
By:
Name:
Title: _____________________________________
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 162
Menifee Mayor and City Council
November 6, 2024
Page
1257 of 1464
Stradling Yocca Carlson & Rauth
1 4861-3596-1831/200299-0015
DISTRICT CONTINUING DISCLOSURE CERTIFICATE
THIS CONTINUING DISCLOSURE CERTIFICATE (this “Disclosure Certificate”) dated as of December 1, 2024 is executed and delivered by Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee (the “District”) in connection with the issuance and delivery by the District of its $____ Special Tax Bonds, Series 2024 (the “Bonds”). The Bonds are being issued pursuant to a Resolution of Issuance adopted on November 6, 2024, by the City Council of the City of Menifee, acting as the legislative body of the District, and the Bond Indenture, dated as of December 1, 2024 (the “Indenture”), by and between the District and Wilmington Trust, National Association, as trustee. The District covenants as follows:
Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the District for the benefit of the Owners and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying with the Rule.
Section 2. Definitions. In addition to the definitions set forth in the Indenture and the Rate and Method of Apportionment, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:
“Annual Report” shall mean any Annual Report provided by the District pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. “Beneficial Owner” shall mean any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income purposes.
“City” shall mean the City of Menifee, County of Riverside, California. “Disclosure Representative” shall mean the Chief Financial Officer of the City, or his or her designee, or such other officer or employee as the District shall designate in writing to the Dissemination Agent from time to time.
“Dissemination Agent” shall mean, initially, Spicer Consulting Group, LLC, or any successor Dissemination Agent designated in writing by the District and which has filed with the then current Dissemination Agent a written acceptance of such designation. “District” shall mean Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee.
“EMMA” shall mean the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board, which can be found at www.emma.msrb.org, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission in the future system of the MSRB.
“Financial Obligation” means a (i) debt obligation; (ii) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (iii) guarantee of (i) or (ii). The term Financial Obligation shall not include municipal Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 163
Menifee Mayor and City Council
November 6, 2024
Page
1258 of 1464
2 4861-3596-1831/200299-0015
securities as to which a final official statement has been provided to the MSRB consistent with the Rule.
“Listed Events” shall mean any of the events listed in Section 5 of this Disclosure Certificate. “MSRB” shall mean the Municipal Securities Rulemaking Board or any other entity designated or authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule.
Until otherwise designated by the MSRB or the Securities and Exchange Commission, filings with the MSRB are to be made through the Electronic Municipal Market Access (EMMA) website of the MSRB, currently located at http://emma.msrb.org.
“Official Statement” shall mean that certain Official Statement for the Bonds dated ____, 2024. “Owners” shall mean the registered owners of the Bonds as set forth in the registration books maintained by the Trustee.
“Participating Underwriter” shall mean Raymond James & Associates, Inc. “Rate and Method of Apportionment” shall mean that certain Rate and Method of Apportionment of Special Tax approved pursuant to the Resolution of Formation. “Resolution of Formation” shall mean the resolutions adopted by the City Council pursuant to which the City Council formed the District.
“Rule” shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. “State” shall mean the State of California.
“Trustee” shall mean Wilmington Trust, National Association or such other entity appointed by the District pursuant to the Indenture to act as the trustee under the Indenture.
Section 3. Provision of Annual Reports.
(a) Not later than March 1 of each year commencing March 1, 2025, the District shall, or shall cause the Dissemination Agent to provide to EMMA an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. If the Dissemination Agent is other than the District, then not later than 15 business days prior to the date referred to in the prior sentence hereof, the District shall provide the Annual Report (in a form suitable for filing with EMMA) to the Dissemination Agent. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the District, if any exist, may be submitted separately from and later than the balance of the Annual Report if they are not available by the date required above for the filing of the Annual Report. (b) In the event that the Dissemination Agent is an entity other than the District, then the provisions of this Section 3(b) shall apply. Not later than fifteen (15) Business Days prior to the date specified in subsection (a) for providing the Annual Report, the District shall provide the Annual Report to the Dissemination Agent. If by fifteen (15) Business Days prior to the due date for an Annual Report the Dissemination Agent has not received a copy of the Annual Report, the Dissemination Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 164
Menifee Mayor and City Council
November 6, 2024
Page
1259 of 1464
3 4861-3596-1831/200299-0015
Agent shall contact the District to determine if the District will be filing the Annual Report in compliance with subsection (a). The District shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by it hereunder. The Dissemination Agent may conclusively rely upon such certification of the District and shall have no duty or obligation to review such Annual Report.
(c) If the Dissemination Agent is other than the District and if the Dissemination Agent is unable to verify that an Annual Report has been provided to EMMA by the date required in subsection (a), the Dissemination Agent shall send, in a timely manner, a notice to EMMA of the failure to file the Annual Report in the form required by EMMA. If the District acts as its own Dissemination Agent, it shall file a notice with EMMA no later than the date specified in subsection (a) for filing an Annual Report if the District fails to file the Annual Report by that date. (d) If the Dissemination Agent is other than the District, the Dissemination Agent shall:
(i) determine each year prior to the date for providing the Annual Report the name and address of the repository if other than the MSRB through EMMA; and (ii) promptly after receipt of the Annual Report, file a report with the District certifying that the Annual Report has been provided to EMMA and the date it was provided. (e) Notwithstanding any other provision of this Disclosure Certificate, all filings shall be made in accordance with the MSRB’s EMMA system or in another manner approved under the Rule.
Section 4. Content of Annual Reports. The District’s Annual Report shall contain or include by reference the following:
(a) Financial Statements. The audited financial statements of the District for the prior fiscal year, if any have been prepared and which, if prepared, shall be prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the District’s audited financial statements, if any are prepared, are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available.
(b) Financial and Operating Data. The Annual Report shall contain or incorporate by reference the following information:
(i) the principal amount of the Bonds outstanding as of the September 2 preceding the filing of the Annual Report;
(ii) the balance in each fund under the Indenture as of the September 2 preceding the filing of the Annual Report;
(iii) the aggregate assessed valuation of the Taxable Property within the District; Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 165
Menifee Mayor and City Council
November 6, 2024
Page
1260 of 1464
4 4861-3596-1831/200299-0015
(iv) any changes to the Rate and Method of Apportionment of Special Tax for the District approved or submitted to the qualified electors for approval prior to the filing of the Annual Report;
(v) a table setting forth the annual Special Tax delinquency rate within the District at June 30 of each fiscal year for which a delinquency exists, listing for each fiscal year, the total Special Tax levy, the amount delinquent and the percent delinquent; (vi) an update of the value-to-lien of the property within the District based on the assessed value and the Special Tax levy for the then current fiscal year, which update may be provided in a form similar to Table 2 in the Official Statement; provided that such update need not include overlapping special tax, assessment or general obligation indebtedness; and (vii) the status of any foreclosure actions being pursued by the District with respect to delinquent Special Taxes within the District.
(c) Any or all of the items listed in (a) or (b) above may be included by specific reference to other documents, including official statements of debt issues of the District or related public entities, which have been submitted to EMMA or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the MSRB through EMMA.
The District shall clearly identify each such other document so included by reference.
Section 5. Reporting of Significant Events.
(a) Pursuant to the provisions of this Section 5, the District shall give, or cause the Dissemination Agent to give, notice to EMMA in a timely manner not in excess of ten (10) business days after the occurrence of any of the following events with respect to the Bonds:
1. principal and interest payment delinquencies;
2. unscheduled draws on debt service reserves reflecting financial difficulties;
3. unscheduled draws on credit enhancements reflecting financial difficulties;
4. substitution of credit or liquidity providers, or their failure to perform;
5. adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds;
6. defeasances;
7. tender offers;
8. ratings changes; and
9. bankruptcy, insolvency, receivership or similar proceedings.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 166
Menifee Mayor and City Council
November 6, 2024
Page
1261 of 1464
5 4861-3596-1831/200299-0015
Note: for the purposes of the event identified in subparagraph (9), the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an obligated person in a proceeding under the U.S.
Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governmental body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person.
10. default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a Financial Obligation of the obligated person, any of which reflect financial difficulties.
(b) Additionally, the District shall give or cause the Dissemination Agent to give notice to EMMA in a timely manner not in excess of ten (10) business days after the occurrence of any of the following events with respect to the Bonds, if material:
1. mergers, consolidations, acquisitions, the sale of all or substantially all of the assets of the obligated persons or their termination;
2. appointment of a successor or additional fiscal agent or the change of the name of a fiscal agent;
3. nonpayment related defaults;
4. modifications to the rights of Bondholders;
5. bond calls;
6. release, substitution or sale of property securing repayment of the Bonds; and
7. incurrence of a Financial Obligation of the obligated person, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the obligated person, any of which affect security holders.
(c) In the event that the District’s fiscal year changes, the District shall report or shall instruct the Dissemination Agent to report such change in the same manner and to the same parties as Listed Events would be reported pursuant to this Section. (d) The District hereby agrees that the undertaking set forth in this Disclosure Certificate is the responsibility of the District, and the Dissemination Agent, if other than the District, shall not be responsible for determining whether the District’s instructions to the Dissemination Agent under this Section comply with the requirements of the Rule.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 167
Menifee Mayor and City Council
November 6, 2024
Page
1262 of 1464
6 4861-3596-1831/200299-0015
Section 6. Termination of Reporting Obligation. The obligations of the District and the Dissemination Agent under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the District shall give notice of such termination in the same manner as for a Listed Event under Section 5.
Section 7. Dissemination Agent. The District may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent, if other than the District, shall not be responsible in any manner for the content of any notice or report prepared by the District pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be Spicer Consulting Group, LLC. The Dissemination Agent may resign by providing (i) thirty (30) days written notice to the District and the Trustee and (ii) upon appointment of a new Dissemination Agent hereunder.
Section 8. Amendment; Waiver.
(a) This Disclosure Certificate may be amended, by written agreement of the parties, without the consent of the Owners, and any provision of this Disclosure Certificate may be waived, if all of the following conditions are satisfied: (1) such amendment or waiver is made in connection with a change in circumstances that arises from a change in legal (including regulatory) requirements, a change in law, or a change in the identity, nature or status of the District or the type of business conducted thereby, (2) the undertakings in this Disclosure Certificate as so amended or waived would, in the opinion of a nationally recognized bond counsel, have complied with the requirements of the Rule as of the date of this Disclosure Certificate, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances, and (3) the amendment or waiver either (i) is approved by the Owners of the Bonds in the same manner as provided in the Indenture for amendments to the Indenture with the consent of Owners or (ii) does not, in the determination of the District, materially impair the interests of the Owners or Beneficial Owners of the Bonds. (b) To the extent any amendment to this Disclosure Certificate results in a change in the type of financial information or operating data provided pursuant to this Disclosure Certificate, the first Annual Report provided thereafter shall include a narrative explanation of the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.
(c) If an amendment is made to the basis on which financial statements are prepared, the Annual Report for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. Such comparison shall include a quantitative and, to the extent reasonably feasible, qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information.
Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the District from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the District chooses to include any information in any Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 168
Menifee Mayor and City Council
November 6, 2024
Page
1263 of 1464
7 4861-3596-1831/200299-0015
Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the District shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.
Section 10. Default. In the event of a failure of the District or the Dissemination Agent to comply with any provision of this Disclosure Certificate, any Owner or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the District and/or the Dissemination Agent to comply with their respective obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Certificate in the event of any failure of the District or the Dissemination Agent to comply with this Disclosure Certificate shall be an action to compel performance.
Section 11. Duties, Immunities and Liabilities of Dissemination Agent. Where an entity other than the District is acting as the Dissemination Agent, the Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the District agrees to indemnify and save the Dissemination Agent and its officers, directors, employees and agents, harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of their powers and duties hereunder, including the costs and expenses (including attorneys’ fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct. Any Dissemination Agent shall be paid (i) compensation by the District for its services provided hereunder in accordance with a schedule of fees to be mutually agreed to; and (ii) all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to review any information provided to it by the District pursuant to this Disclosure Certificate. The obligations of the District under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. No person shall have any right to commence any action against the Dissemination Agent seeking any remedy other than to compel specific performance of this Disclosure Certificate. The Dissemination Agent shall not be liable under any circumstances for monetary damages to any person for any breach under this Disclosure Certificate.
Section 12. Notices. Any notices or communications to or among any of the parties to this Disclosure Certificate may be given as follows:
District: Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee
City of Menifee
29844 Haun Road
Menifee, CA 92586
Attn: City Manager
Underwriter: Raymond James & Associates, Inc.
10250 Constellation Boulevard, Suite 850
Los Angeles, CA 90067
Attn: Managing Director
Any person may, by written notice to the other persons listed above, designate a different address or telephone number(s) to which subsequent notice or communications should be sent.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 169
Menifee Mayor and City Council
November 6, 2024
Page
1264 of 1464
8 4861-3596-1831/200299-0015
Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the District, the Trustee, the Dissemination Agent, the Participating Underwriter and Owners and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
Section 14. Merger. Any person succeeding to all or substantially all of the Dissemination Agent’s business shall be the successor Dissemination Agent without the filing of any paper or any further act.
This Disclosure Certificate is executed as of the date and year first set forth above.
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ROCKPORT RANCH) OF THE CITY OF MENIFEE
By:
Travis Hickey
Disclosure Representative
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 170
Menifee Mayor and City Council
November 6, 2024
Page
1265 of 1464
1 $____________
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
BOND PURCHASE AGREEMENT
_________, 2024
City of Menifee
Community Facilities District No. 2023-1
(Rockport Ranch)
29844 Haun Road
Menifee, California 92586
Ladies and Gentlemen:
Raymond James & Associates, Inc., as underwriter (the “Underwriter”), acting not as a fiduciary or agent for you, but on behalf of itself, offers to enter into this Bond Purchase Agreement (this “Purchase Agreement”) with Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee (the “Community Facilities District”), which upon acceptance will be binding upon the Underwriter and the Community Facilities District. The agreement of the Underwriter to purchase the Bonds (as hereinafter defined) is contingent upon the Community Facilities District satisfying all of the obligations imposed upon them under this Purchase Agreement. This offer is made subject to the Community Facilities District’s acceptance by the execution of this Purchase Agreement and its delivery to the Underwriter at or before 11:59 P.M., local time, on the date hereof, and, if not so accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the Community Facilities District at any time prior to the acceptance hereof by the Community Facilities District. All capitalized terms used herein, which are not otherwise defined, shall have the meaning provided for such terms in the Bond Indenture, dated as of December 1, 2024, (the “Indenture”) by and between the District and Wilmington Trust, National Association, as trustee (the “Trustee”).
1. Purchase, Sale and Delivery of the Bonds.
Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein: (i) the Underwriter hereby agrees to purchase from the Community Facilities District and the Community Facilities District hereby agrees to sell to the Underwriter all (but not less than all) of the $____________ aggregate principal amount of the Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee Special Tax Bonds, Series 2024 (the “Bonds”), dated the Closing Date (as hereinafter defined), bearing interest at the rates and maturing on the dates and in the principal amounts set forth in Exhibit A hereto. The purchase price for the Bonds shall be $______ (being 100% of the aggregate principal amount thereof, plus an original issue premium of $______ and less an Underwriter’s discount of $_______).
The Underwriter agrees to make a bona fide public offering of all of the Bonds initially at the public offering prices (or yields) set forth in Exhibit A attached hereto and incorporated herein by reference. Subsequent to the initial public offering, the Underwriter reserves the right to change the Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 171
Menifee Mayor and City Council
November 6, 2024
Page
1266 of 1464
2 public offering prices (or yields) as it deems necessary in connection with the marketing of the Bonds subject to Section 2 hereof, provided that the Underwriter shall not change the interest rates set forth in Exhibit A. The Bonds may be offered and sold to certain dealers at prices lower than such initial offering prices.
The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable from the Net Taxes as provided in the Indenture, the Preliminary Official Statement (as hereinafter defined), and the Mello-Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the Government Code of the State of California) (the “Community Facilities District Act”). The issuance of the Bonds has been duly authorized by the City Council of the City of Menifee (the “City”), as the legislative body for the Community Facilities District, pursuant to a resolution (the “Community Facilities District Resolution of Issuance”) adopted on _______, 2024.
The proceeds of the Bonds will be used to (i) finance certain public improvements needed with respect to the development of property located within the District, including public improvements to be owned by the City and water and sewer facilities to be owned and operated by the Eastern Municipal Water District; (ii) fund a reserve account for the Bonds; (iii) fund capitalized interest on a portion of the Bonds through September 1, 2025, and (iv) pay costs of issuance for the Bonds.
The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable from special taxes as provided in the Indenture (the “Special Taxes”).
A. The Community Facilities District hereby acknowledges that the Underwriter is entering into this Purchase Agreement in reliance on the representations, warranties and agreements made by the Community Facilities District herein, and the Community Facilities District shall take all action necessary to enforce its rights hereunder for the benefit of the Underwriter and shall immediately notify the Underwriter if it becomes aware that any representation, warranty or agreement made by the Community Facilities District herein is incorrect in any material respect.
The Community Facilities District acknowledges and agrees that (i) the purchase and sale of the Bonds pursuant to this Purchase Agreement is an arm’s-length commercial transaction between the Community Facilities District and the Underwriter, (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as principal and not as the agent or fiduciary of the Community Facilities District, (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the Community Facilities District with respect to (a) the offering of the Bonds or the process leading thereto (whether or not the Underwriter, or any affiliate of the Underwriter, has advised or is currently advising the Community Facilities District on other matters) or (b) any other obligations to the Community Facilities District with respect to the offering contemplated hereby, except the obligations expressly set forth in this Purchase Agreement or otherwise imposed by law, (iv) the Underwriter has financial interests that differ from those of the Community Facilities District and (v) the Community Facilities District has consulted with their own legal, financial and other advisors to the extent they have deemed appropriate in connection with this transaction. The Community Facilities District acknowledges that it has previously provided the Underwriter with an acknowledgement of receipt of the required Underwriter disclosure under Rule G-17 of the Municipal Securities Rulemaking Board (“MSRB”). The Community Facilities District acknowledges and represents that it has engaged Urban Futures, Inc. as its municipal advisor (the “Municipal Advisor”) Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 172
Menifee Mayor and City Council
November 6, 2024
Page
1267 of 1464
3 (as defined in Securities and Exchange Commission Rule 15Ba1) and will rely solely on the financial advice of Urban Futures, Inc. with respect to the Bonds.
B. Pursuant to the authorization of the Community Facilities District, the Underwriter has distributed copies of the Preliminary Official Statement dated [POS Date], relating to the Bonds, which, together with the cover page, inside cover page and appendices thereto is herein called the “Preliminary Official Statement.” By its acceptance of this Purchase Agreement, the Community Facilities District hereby ratifies the use by the Underwriter of the Preliminary Official Statement, and the Community Facilities District agrees to execute a final official statement relating to the Bonds (including any supplements and/or amendments thereto, the “Official Statement”) which will consist of the Preliminary Official Statement with such changes as may be made thereto, with the approval of Stradling Yocca Carlson & Rauth LLP, Bond Counsel (“Bond Counsel”), Stradling Yocca Carlson & Rauth LLP, Disclosure Counsel (“Disclosure Counsel”), and the Underwriter, and to provide copies thereof to the Underwriter as set forth herein. The Community Facilities District hereby authorizes and requires the Underwriter to use and promptly distribute, in connection with the offer and sale of the Bonds, the Preliminary Official Statement, the Official Statement and any supplement or amendment thereto. The Community Facilities District further authorizes the Underwriter to use and distribute, in connection with the offer and sale of the Bonds, the Indenture, the Continuing Disclosure Certificate executed by the Community Facilities District in connection with the Bonds (the “Continuing Disclosure Certificate”), this Purchase Agreement and all information contained herein, and all other documents, certificates and statements furnished by or on behalf of the Community Facilities District to the Underwriter in connection with the transactions contemplated by this Purchase Agreement.
C. To assist the Underwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5) (the “Rule”), the Community Facilities District will undertake pursuant to the Continuing Disclosure Certificate, in the form attached to the Official Statement as Appendix F, to provide annual reports and notices of certain enumerated events. A description of this undertaking is set forth in the Preliminary Official Statement and will also be set forth in the Official Statement.
D. Except as the Underwriter and the Community Facilities District may otherwise agree, the Community Facilities District will deliver to the Underwriter, at the offices of Bond Counsel in Newport Beach, California, or at such other location as may be mutually agreed upon by the Underwriter and the Community Facilities District, the documents hereinafter mentioned; and the Community Facilities District will deliver to the Underwriter through the facilities of The Depository Trust Company (“DTC”), the Bonds, in definitive form (all Bonds bearing CUSIP numbers), duly executed by the Community Facilities District and authenticated by the Trustee in the manner provided for in the Indenture and the Community Facilities District Act at 8:00 a.m. California time, on [Closing Date] (the “Closing Date”), and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in paragraph (A) of this Section by wire transfer, payable in federal or other immediately available funds (such delivery and payment being herein referred to as the “Closing”). The Bonds shall be in fully registered book-entry form (which may be typewritten) and shall be registered in the name of Cede & Co., as nominee of DTC.
2. Establishment of Issue Price.
A. The Underwriter agrees to assist the Community Facilities District in establishing the issue price of the Bonds and shall execute and deliver to the Community Facilities Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 173
Menifee Mayor and City Council
November 6, 2024
Page
1268 of 1464
4 District at Closing an “issue price” or similar certificate, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit C, with such modifications as may be appropriate or necessary, in the reasonable judgment of the Underwriter, the Community Facilities District and Bond Counsel, to accurately reflect, as applicable, the sales price or prices or the initial offering price or prices to the public of the Bonds.
B. Except as otherwise set forth in Exhibit A attached hereto, the Community Facilities District will treat the first price at which 10% of each maturity of the Bonds (the “10% test”) is sold to the public as the issue price of that maturity (if different interest rates apply within a maturity, each separate CUSIP number within that maturity will be subject to the 10% test). At or promptly after the execution of this Purchase Agreement, the Underwriter shall report to the Community Facilities District the price or prices at which it has sold to the public each maturity of Bonds. If at that time the 10% test has not been satisfied as to any maturity of the Bonds, the Underwriter agrees to promptly report to the Community Facilities District the prices at which it sells the unsold Bonds of that maturity to the public. That reporting obligation shall continue, whether or not the Closing Date has occurred, until the 10% test has been satisfied as to the Bonds of that maturity or until all Bonds of that maturity have been sold to the public.
C. The Underwriter confirms that it has offered the Bonds to the public on or before the date of this Purchase Agreement at the offering price or prices (the “initial offering price”), or at the corresponding yield or yields, set forth in Exhibit A attached hereto. Exhibit A also sets forth, as of the date of this Purchase Agreement, the maturities, if any, of the Bonds for which the Underwriter represents that (i) the 10% test has been satisfied (assuming orders are confirmed by the close of the business day immediately following the date of this Purchase Agreement) and (ii) the 10% test has not been satisfied and for which the Community Facilities District and the Underwriter agree that the restrictions set forth in the next sentence shall apply, which will allow the Community Facilities District to treat the initial offering price to the public of each such maturity as of the sale date as the issue price of that maturity (the “hold-the-offering-price rule”). So long as the hold-the-offering- price rule remains applicable to any maturity of the Bonds, the Underwriter will neither offer nor sell unsold Bonds of that maturity to any person at a price that is higher than the initial offering price to the public during the period starting on the sale date and ending on the earlier of the following:
1. the close of the fifth (5th) business day after the sale date; or
2. the date on which the Underwriter has sold at least 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public.
The Underwriter shall promptly advise the Community Facilities District when it has sold 10% of that maturity of the Bonds to the public at a price that is no higher than the initial offering price to the public, if that occurs prior to the close of the fifth (5th) business day after the sale date.
D. The Underwriter confirms that:
(i) any selling group agreement and any third-party distribution agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer who is a member of the selling group and each broker-dealer that is a party to such third-party distribution agreement, as applicable:
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 174
Menifee Mayor and City Council
November 6, 2024
Page
1269 of 1464
5 (A)(i) to report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter that the 10% test has been satisfied as to the Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter and (ii) to comply with the hold-the-offering-price rule, if applicable, if and for so long as directed by the Underwriter, (B) to promptly notify the Underwriter of any sales of Bonds that, to its knowledge, are made to a purchaser who is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below), and (C) to acknowledge that, unless otherwise advised by the dealer or broker-dealer, the Underwriter shall assume that each order submitted by the dealer or broker-dealer is a sale to the public. (ii) any selling group agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each dealer that is a party to a third-party distribution agreement to be employed in connection with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such third-party distribution agreement to (A) report the prices at which it sells to the public the unsold Bonds of each maturity allocated to it, whether or not the Closing Date has occurred, until either all Bonds of that maturity allocated to it have been sold or it is notified by the Underwriter or the dealer that the 10% test has been satisfied as to the Bonds of that maturity, provided that, the reporting obligation after the Closing Date may be at reasonable periodic intervals or otherwise upon request of the Underwriter or the dealer, and (B) comply with the hold-the-offering-price rule, if applicable, if and for so long as directed by the Underwriter or the dealer and as set forth in the related pricing wires.
E. The Community Facilities District acknowledges that, in making the representation set forth in this section, the Underwriter will rely on (i) in the event a selling group has been created in connection with the initial sale of the Bonds to the public, the agreement of each dealer who is a member of the selling group to comply with the requirements for establishing the issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds, as set forth in a selling group agreement and the related pricing wires, and (ii) in the event that a third-party distribution agreement was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a party to such agreement to comply with the requirements for establishing the issue price of the Bonds, including, but not limited to, its agreement to comply with the hold-the-offering-price rule, if applicable to the Bonds, as set forth in the third-party distribution agreement and the related pricing wires.
F. The Underwriter acknowledges that sales of any Bonds to any person that is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below) shall not constitute sales to the public for purposes of this section.
Further, for purposes of this section:
1. “public” means any person other than an underwriter or a related party;
2. “underwriter” means (A) any person that agrees pursuant to a written contract with the Community Facilities District (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the public and (B) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 175
Menifee Mayor and City Council
November 6, 2024
Page
1270 of 1464
6 to participate in the initial sale of the Bonds to the public (including a member of a selling group or a party to a third-party distribution agreement participating in the initial sale of the Bonds to the public);
3. a purchaser of any of the Bonds is a “related party” to an underwriter if the underwriter and the purchaser are subject, directly or indirectly, to (A) more than 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation of another), (B) more than 50% common ownership of their capital interests or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (C) more than 50% common ownership of the value of the outstanding stock of the corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other); and
4. “sale date” means the date of execution of this Purchase Agreement by all parties.
3. Representations, Warranties and Covenants of the Community Facilities District. The Community Facilities District represents, warrants and covenants to the Underwriter on behalf of itself and the City that:
A. The City is duly organized and validly existing as a general law city under the Constitution and laws of the State of California and has duly authorized the formation of the Community Facilities District pursuant to resolutions duly adopted by the City Council (the “Community Facilities District Formation Resolution” and, together with the Community Facilities District Resolution of Issuance, the “Community Facilities District Resolutions”) and the Community Facilities District Act. The City Council, as the legislative body of the City and the Community Facilities District, has duly adopted the Community Facilities District Formation Resolution, and has caused to be recorded in the real property records of the County of Riverside, notice of special tax lien, and any required amendments thereof (collectively, the “Notice of Special Tax Lien”) (the Community Facilities District Formation Resolution and Notice of Special Tax Lien being collectively referred to herein as the “Formation Documents”), and has duly adopted the Community Facilities District Resolution of Issuance. Each of its Formation Documents remains in full force and effect as of the date hereof and has not been amended. The Community Facilities District is duly organized and validly existing as a Community Facilities District under the laws of the State of California. The Community Facilities District has, and at the Closing Date will have, as the case may be, full legal right, power and authority: (i) to execute, deliver and perform its obligations under this Purchase Agreement, the Continuing Disclosure Certificate and the Indenture, and to carry out all transactions contemplated by each of such agreements; (ii) to issue, sell and deliver the Bonds as provided herein; and (iii) to carry out, give effect to and consummate the transactions contemplated by the Formation Documents, the Indenture, the Bonds, the Continuing Disclosure Certificate, this Purchase Agreement and the Official Statement.
This Purchase Agreement, the Indenture, the Bonds and the Continuing Disclosure Certificate are collectively referred to herein as the “Community Facilities District Documents.” B. The Community Facilities District and the City, as applicable, have each complied, and will at the Closing Date be in compliance in all material respects, with the Formation Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 176
Menifee Mayor and City Council
November 6, 2024
Page
1271 of 1464
7 Documents and the Community Facilities District Documents, and any immaterial noncompliance by the Community Facilities District and the City, if any, will not impair the ability of the Community Facilities District and the City, as applicable, to carry out, give effect to or consummate the transactions contemplated by the foregoing. From and after the date of issuance of the Bonds, the Community Facilities District will continue to comply with the covenants of the Community Facilities District contained in the Community Facilities District Documents.
C. The information in the Preliminary Official Statement and in the Official Statement relating to the Community Facilities District and the Bonds (other than information under the captions “PROPERTY OWNERSHIP AND THE DEVELOPMENT,” and “UNDERWRITING,” Appendices D, G and H, information provided by Lennar Homes of California, LLC (the “Developer”), the Appraiser and the Special Tax Consultant (as such terms are defined herein) and statements pertaining to the book entry system, as to which no view is expressed), is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and, upon delivery and up to and including 25 days after the End of the Underwriting Period (as defined in paragraph (D) below), the Official Statement will be amended and supplemented so as to contain no misstatement of any material fact or omission of any statement necessary to make the statements contained therein, in the light of the circumstances in which such statements were made, not misleading.
D. Up to and including 25 days after the End of the Underwriting Period (as defined below), the Community Facilities District will advise the Underwriter promptly of any proposal to amend or supplement the Official Statement and will not effect or consent to any such amendment or supplement without the consent of the Underwriter, which consent will not be unreasonably withheld. The Community Facilities District will advise the Underwriter promptly of the institution of any proceedings known to it by any governmental agency prohibiting or otherwise materially affecting the use of the Official Statement in connection with the offering, sale or distribution of the Bonds. As used herein, the term “End of the Underwriting Period” means the later of such time as: (i) the Bonds are delivered to the Underwriter; or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the End of the Underwriting Period shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the Community Facilities District at or prior to the Closing Date and shall specify a date (other than the Closing Date) to be deemed the “End of the Underwriting Period.” E. Except as described in the Preliminary Official Statement and Official Statement, the Community Facilities District is not, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, and the performance of its obligations under the Community Facilities District Documents and compliance with the provisions of each thereof, or the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement, will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 177
Menifee Mayor and City Council
November 6, 2024
Page
1272 of 1464
8 note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance by the Community Facilities District of its obligations under the Community Facilities District Documents or the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement.
F. Except as may be required under the “blue sky” or other securities laws of any jurisdiction, all approvals, consents, authorizations, elections and orders of, or filings or registrations with, any governmental authority, board, agency or commission having jurisdiction that would constitute a condition precedent to, or the absence of which would materially adversely affect, the performance by the Community Facilities District of its obligations under the Community Facilities District Documents, and the performance of the conditions precedent to be performed by the Community Facilities District pursuant to this Purchase Agreement, have been or will be obtained at the Closing Date and are or will be in full force and effect at the Closing Date.
G. The Community Facilities District Documents conform as to form and tenor to the descriptions thereof contained in the Official Statement.
H. The Bonds are payable from the Special Tax of the Community Facilities District, as set forth in the Indenture, the levy of which has been duly and validly authorized pursuant to the Community Facilities District Act and the Community Facilities District will covenant in the Indenture to levy the Special Taxes within the Community Facilities District in an amount which, together with other available funds, is required for the payment of the principal of, and interest on, the Bonds when due and payable, all as provided in the Indenture.
I. The Indenture creates a valid pledge of, first lien upon and security interest in, the Net Taxes, and in the moneys in the Special Tax Fund (other than the Administrative Expense Account) established pursuant to the Indenture, on the terms and conditions set forth in the Indenture.
J. Except as disclosed in the Preliminary Official Statement, there are, to the best of the Community Facilities District’s knowledge, no entities with outstanding assessment liens against any of the properties within the Community Facilities District or that are senior to or on a parity with the Special Taxes of the Community Facilities District referred to in paragraph (I) hereof.
K. The Preliminary Official Statement was deemed final by a duly authorized officer of the Community Facilities District prior to its delivery to the Underwriter, except for the omission of such information as is permitted to be omitted in accordance with paragraph (b)(1) of the Rule. The Community Facilities District hereby covenants and agrees that, within seven (7) business days from the date hereof, or upon reasonable written notice from the Underwriter within sufficient time to accompany any confirmation requesting payment from any customers of the Underwriter, the Community Facilities District shall cause a final electronic form of the Official Statement to be delivered to the Underwriter in sufficient quantity to comply with paragraph (b)(4) of the Rule and Rules G-12, G-15, G-32 and G-36 of the Municipal Securities Rulemaking Board.
L. At the time of acceptance hereof there is and as of the Closing there will be no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body (collectively and individually, an “Action”) pending (notice of which has been served on the Community Facilities District) or to the best knowledge of the Community Facilities District or the City threatened, in which any such Action: (i) in any way questions the Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 178
Menifee Mayor and City Council
November 6, 2024
Page
1273 of 1464
9 existence of the Community Facilities District or the titles of the officers of the Community Facilities District to their respective offices; (ii) affects, contests or seeks to prohibit, restrain or enjoin the issuance or delivery of the Bonds or the payment or collection of Special Taxes or any amounts pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contests or affects the validity of the Community Facilities District Documents or the consummation of the transactions on the part of the Community Facilities District contemplated thereby; (iii) contests the exemption of interest on the Bonds from federal or State income taxation or contests the powers of the Community Facilities District which may result in any material adverse change relating to the financial condition of the Community Facilities District; or (iv) contests the completeness or accuracy of the Preliminary Official Statement or the Official Statement or any supplement or amendment thereto or asserts that the Preliminary Official Statement or the Official Statement contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and as of the time of acceptance hereof there is and, as of the Closing Date, there will be no basis for any action, suit, proceeding, inquiry or investigation of the nature described in clauses (i) through (iv) of this sentence.
M. Any certificate signed on behalf of the Community Facilities District by any officer or employee of the Community Facilities District authorized to do so shall be deemed a representation and warranty by the Community Facilities District to the Underwriter on behalf of itself and the Community Facilities District as to the statements made therein.
N. At or prior to the Closing the Community Facilities District will have duly authorized, executed and delivered the Continuing Disclosure Certificate in substantially the form attached as Appendix F to the Official Statement. The Community Facilities District has not been subject to any previous undertakings with regard to the Rule to provide annual reports or notices of enumerated events in the last five years.
O. The Community Facilities District will apply the proceeds of the Bonds in accordance with the Indenture and as described in the Official Statement.
P. Until such time as moneys have been set aside in an amount sufficient to pay all then outstanding Bonds at maturity or to the date of redemption if redeemed prior to maturity, plus unpaid interest thereon and premium, if any, to maturity or to the date of redemption if redeemed prior to maturity, the Community Facilities District will faithfully perform and abide by all of the covenants, undertakings and provisions contained in the Indenture.
Q. Between the date of this Purchase Agreement and the date of Closing, the Community Facilities District will not offer or issue any bonds, notes or other obligations for borrowed money not previously disclosed to the Underwriter.
The Community Facilities District hereby approves the preparation and distribution of the Official Statement, consisting of the Preliminary Official Statement with such changes as are noted thereon and as may be made thereto, with the approval of Bond Counsel, Disclosure Counsel and the Underwriter, from time to time prior to the Closing Date.
The execution and delivery of this Purchase Agreement by the Community Facilities District shall constitute a representation by the Community Facilities District to the Underwriter that the Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 179
Menifee Mayor and City Council
November 6, 2024
Page
1274 of 1464
10 representations and warranties contained in this Section 3 with respect to the Community Facilities District are true as of the date hereof.
4. Conditions to the Obligations of the Underwriter. The obligation of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the representations and warranties on the part of the Community Facilities District contained herein, to the accuracy in all material respects of the statements of the officers and other officials of the Community Facilities District made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the Community Facilities District of its obligations to be performed hereunder at or prior to the Closing Date, and in reliance upon the representations and covenants of the Developer contained in the certificates delivered as of the Closing Date, and to the following additional conditions:
A. At the Closing Date, the Community Facilities District Resolutions and the Community Facilities District Documents shall be in full force and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to in writing by the Underwriter, and there shall have been taken in connection therewith, with the issuance of the Bonds and with the Bonds, and with the transactions contemplated thereby, and by this Purchase Agreement, all such actions as, in the opinion of Bond Counsel, shall be necessary and appropriate.
B. At the Closing Date, except as described in the Official Statement, the City shall not be, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound, and the performance of the conditions precedent to be performed hereunder will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance of the conditions precedent to be performed by the City hereunder.
C. At the Closing Date, except as described in the Official Statement, the Community Facilities District shall not be, in any respect material to the transactions referred to herein or contemplated hereby, in breach of or in default under, any law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, and the performance by the Community Facilities District of its obligations under the Bonds, the Community Facilities District Resolutions, the Indenture, and any other instruments contemplated by any of such documents, and compliance with the provisions of each thereof, or the performance of the conditions precedent to be performed hereunder, will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 180
Menifee Mayor and City Council
November 6, 2024
Page
1275 of 1464
11 agreement or other instrument to which the Community Facilities District is a party or is otherwise subject or bound, in any manner which would materially and adversely affect the performance by the Community Facilities District of its obligations under the Indenture, the Bonds or the performance of the conditions precedent to be performed by the Community Facilities District hereunder.
D. The information contained in the Official Statement is, as of the Closing Date and as of the date of any supplement or amendment thereto pursuant hereto, will be true and correct in all material respects and does not, as of the Closing Date or as of the date of any supplement or amendment thereto, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
E. Between the date hereof and the Closing Date, the market price or marketability, at the initial offering prices set forth on the inside cover page of the Official Statement, of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds, shall not have been materially adversely affected, in the judgment of the Underwriter (evidenced by a written notice to the Community Facilities District terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following:
1. Legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congress by any committee of such House to which such legislation had been referred for consideration, or a decision rendered by a court established under Article III of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department of the United States of America or the Internal Revenue Service, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon such interest as would be received by any owners of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof; or
2. Legislation introduced in or enacted (or resolution passed) by the Congress or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, including any or all underlying arrangements, are not exempt from registration under or other requirements of the Securities Act of 1933, as amended, or that the Indenture is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character of the Bonds, including any or all underlying arrangements, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws as amended and then in effect; or
3. A general suspension of trading on the New York Stock Exchange or other major exchange shall be in force, or minimum or maximum prices for trading shall have been fixed and be in force, or maximum ranges for prices for securities shall have been required and be in force on any such exchange, whether by virtue of determination by that exchange or by order of the SEC or any other governmental authority having jurisdiction; or Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 181
Menifee Mayor and City Council
November 6, 2024
Page
1276 of 1464
12 4. The introduction, proposal or enactment of any amendment to the Federal or California Constitution or any action by any Federal or California court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the Community Facilities District, its property, income, securities (or interest thereon), the validity or enforceability of Special Taxes, or the ability of the Community Facilities District to issue the Bonds as contemplated by the Indenture and the Official Statement; or
5. Any event occurring, or information becoming known which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Preliminary Official Statement or in the Official Statement, or has the effect that the Preliminary Official Statement or the Official Statement contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; or
6. Any national securities exchange, the Comptroller of the Currency, or any other governmental authority, shall impose as to the Bonds, or obligations of the general character of the Bonds, any material restrictions not now in force, or increase materially those now in force, with respect to the extension of credit by, or the charge to the net capital requirements of, the Underwriter; or
7. There shall have occurred (1) an outbreak or escalation of hostilities or the declaration by the United States of a national emergency or war or (2) any other calamity or crisis in the financial markets of the United States or elsewhere or the escalation of such calamity or crisis; or
8. Except as disclosed in or contemplated by the Official Statement, any material adverse change in the affairs of the City or Community Facilities District shall have occurred; or
9. Any event or circumstance shall exist that either makes untrue or incorrect in any material respect any statement or information in the Official Statement (other than any statement provided by the Underwriter) or is not reflected in the Official Statement but should be reflected therein in order to make the statements therein, in the light of the circumstances under which they were made, not misleading and, in either such event, the Community Facilities District refuses to permit the Official Statement to be supplemented to supply such statement or information, or the effect of the Official Statement as so supplemented is to materially adversely affect the market price or marketability of the Bonds or the ability of the Underwriter to enforce contracts for the sale of the Bonds; or
10. A general banking moratorium shall have been declared by federal or State authorities having jurisdiction and be in force; or
11. A material disruption in securities settlement, payment or clearance services affecting the Bonds shall have occurred; or
12. Any new restriction on transactions in securities materially affecting the market for securities (including the imposition of any limitation on interest rates) or the extension of credit by, or a charge to the net capital requirements of, underwriters shall have been established by Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 182
Menifee Mayor and City Council
November 6, 2024
Page
1277 of 1464
13 the New York Stock Exchange, the SEC, any other federal or State agency or the Congress of the United States, or by Executive Order; or
13. A decision by a court of the United States shall be rendered, or a stop order, release, regulation or no-action letter by or on behalf of the SEC or any other governmental agency having jurisdiction of the subject matter shall have been issued or made, to the effect that the issuance, offering or sale of the Bonds, including the underlying obligations as contemplated by this Purchase Agreement or by the Official Statement, or any document relating to the issuance, offering or sale of the Bonds, is or would be in violation of any provision of the federal securities laws at the Closing Date, including the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended and the Trust Indenture Act of 1939, as amended; or
14. Any proceeding shall have been commenced or be threatened in writing by the Securities and Exchange Commission against the City or the Community Facilities District; or
15. The commencement of any Action.
F. At or prior to the Closing Date, the Underwriter shall have received a counterpart original or certified copy of the following documents, in each case satisfactory in form and substance to the Underwriter:
1. The Official Statement, executed on behalf of the Community Facilities District by an authorized officer;
2. The Indenture, duly executed and delivered by the Community Facilities District and the Trustee;
3. The Community Facilities District Resolution, the Community Facilities District Documents and the Formation Documents, together with a certificate dated as of the Closing Date of the City Clerk to the effect that the Community Facilities District Resolutions are true, correct and complete copies of the ones duly adopted by the City Council;
4. The Continuing Disclosure Certificate executed and delivered by an authorized officer of the Community Facilities District;
5. An unqualified approving opinion for the Bonds, dated the Closing Date and addressed to the Community Facilities District, of Bond Counsel, to the effect that the Bonds are the valid, legal and binding obligations of the Community Facilities District and that the interest thereon is excluded from gross income for federal income tax purposes and exempt from personal income taxes of the State of California, in substantially the form included as Appendix C to the Official Statement, together with a letter of Bond Counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such opinion addressed to the Community Facilities District may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it;
6. A supplemental opinion or opinions, dated the Closing Date and addressed to the Underwriter, of Bond Counsel, to the effect that:
(i) this Purchase Agreement and the Continuing Disclosure Certificate have been duly authorized, executed and delivered by the Community Facilities District and, assuming due authorization, execution and delivery by the other parties thereto, as applicable, Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 183
Menifee Mayor and City Council
November 6, 2024
Page
1278 of 1464
14 constitutes the legal, valid and binding obligations of the Community Facilities District and are enforceable in accordance with their terms, except to the extent that enforceability may be limited by moratorium, bankruptcy, reorganization, insolvency or other similar laws affecting creditors’ rights generally or by the exercise of judicial discretion in accordance with general principles of equity or otherwise in appropriate cases and by limitations on legal remedies against public agencies in the State; (ii) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Indenture is exempt from qualification under the Trust Indenture Act of 1939, as amended;
(iii) the information contained in the Official Statement on the cover and under the captions “THE BONDS” (other than the caption “Debt Service Schedule”), “SOURCES OF PAYMENT FOR THE BONDS,” “TAX MATTERS” and “LEGAL OPINION” and in Appendices C and E to the Official Statement, are accurate insofar as such statements purport to summarize certain provisions of the Bonds, the Indenture, Bond Counsel’s final approving opinion, and the Community Facilities District Act.
7. The letter of Disclosure Counsel, dated the Closing Date and addressed to the Community Facilities District and to the Underwriter, to the effect that, without having undertaken to determine independently the accuracy or completeness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the Community Facilities District, the Special Tax Consultant and others, and their examination of certain documents, nothing has come to their attention which has led them to believe that the Preliminary Official Statement as of its date and the Official Statement as of its date and as of the Closing Date contained or contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to any financial statements or other financial, statistical or engineering data or forecasts, numbers, charts, estimates, projections, assumptions, or expressions of opinion, any information about valuation, appraisals, absorption, archeological or environmental matters, or any information with respect to the City or about DTC or the book-entry-only system);
8. A certificate dated the Closing Date and signed by an authorized representative of the Community Facilities District or an authorized designee, on behalf of the Community Facilities District to the effect that: (i) the representations and warranties made by the Community Facilities District contained herein are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii) to the best knowledge of such officer, no event has occurred since the date of the Official Statement that should be disclosed in the Official Statement for the purpose for which it is to be used or which it is necessary to disclose therein in order to make the statements and information therein not misleading in any material respect; and (iii) the Community Facilities District has complied with all the agreements and satisfied all the conditions on its part to be satisfied under this Purchase Agreement, the Community Facilities District Resolutions, and the Community Facilities District Documents at or prior to the Closing Date;
9. An opinion of the City Attorney dated the date of Closing and addressed to the Underwriter and the City, to the effect that:
(i) The City is a municipal corporation and general law city, duly organized and existing under the Constitution and laws of the State of California; Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 184
Menifee Mayor and City Council
November 6, 2024
Page
1279 of 1464
15 (ii) The Community Facilities District Resolutions have been duly adopted at meetings of the City Council, which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting throughout, and the Community Facilities District Resolutions are in full force and effect and have not been modified, amended, rescinded or repealed since the respective dates of their adoption; (iii) The Community Facilities District Documents and the Official Statement have been duly authorized, executed and delivered by the City and the Community Facilities District Documents constitute the legal, valid and binding obligations of the Community Facilities District enforceable against the Community Facilities District in accordance with their terms, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights, to the application of equitable principles where equitable remedies are sought and to the exercise of judicial discretion in appropriate cases;
(iv) Except as may be stated in the Official Statement, there is no action, suit, proceeding or investigation before or by any court, public board or body pending (notice of which has been served on the City or the Community Facilities District) or, to such counsel’s knowledge, threatened wherein an unfavorable decision, ruling or finding would: (a) affect the creation, organization, existence or powers of the City, or the titles of its members and officers to their respective offices; or (b) affect the validity of the Community Facilities District Documents or restrain or enjoin the repayment of the Bonds or in any way contest or affect the validity of the Community Facilities District Documents or contest the authority of the Community Facilities District to enter into or perform its obligations under any of the Community Facilities District Documents, questions the right of the Community Facilities District to use Special Taxes levied within the Community Facilities District for the repayment of the Bonds or affects in any manner the right or ability of the Community Facilities District to collect the Special Taxes or pledge the Net Taxes levied within the Community Facilities District for the repayment of the Bonds;
10. A certificate dated the Closing Date from Integra Realty Resources (the “Appraiser”) to the effect that: (i) the statements in the Official Statement provided by the Appraiser and all information supplied by it for use in the Official Statement were as of the date of the Official Statement and are as of the Closing Date true and correct, and do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (ii) no events or occurrences have been ascertained by the Appraiser or have come to the Appraiser’s attention since the date of value set forth in the Appraisal that would materially change the opinion set forth in the Appraisal;
11. A certificate dated the Closing Date from Spicer Consulting Group, LLC to the effect that: (i) the Special Tax if collected in the maximum amounts permitted pursuant to the Rate and Method of Apportionment of Special Taxes of the Community Facilities District as of the Closing Date would generate at least 110% of the annual debt service payable with respect to the Bonds plus the Administrative Expenses Cap in each year, based on such assumptions and qualifications as shall be acceptable to the Underwriter; and (ii) the statements in the Official Statement provided by Spicer Consulting Group, LLC concerning Special Taxes in the Community Facilities District and all information supplied by it for use in the Official Statement were as of the date of the Official Statement and are as of the Closing Date true and correct, and do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 185
Menifee Mayor and City Council
November 6, 2024
Page
1280 of 1464
16 12. Certified copies of the general resolution of the Trustee authorizing the execution and delivery of certain documents by certain officers of the Trustee, which resolution authorizes the execution of the Indenture and the authentication of the Bonds;
13. A certificate of the Trustee, dated the Closing Date, to the effect that:
(i) the Trustee is authorized to carry out corporate trust powers, and has full power and authority to perform its duties under the Indenture; (ii) the Trustee is duly authorized to execute and deliver the Indenture, to accept the obligations created by the Indenture and to authenticate the Bonds pursuant to the terms of the Indenture; (iii) no consent, approval, authorization or other action by any governmental or regulatory authority having jurisdiction over the Trustee that has not been obtained is or will be required for the authentication of the Bonds or the consummation by the Trustee of the other transactions contemplated to be performed by the Trustee in connection with the authentication of the Bonds and the acceptance and performance of the obligations created by the Indenture; and (iv) to the best of its knowledge, compliance with the terms of the Indenture will not conflict with, or result in a violation or breach of, or constitute a default under, any loan agreement, indenture, bond, note, resolution or any other agreement or instrument to which the Trustee is a party or by which it is bound, or any law or any rule, regulation, order or decree of any court or governmental agency or body having jurisdiction over the Trustee or any of its activities or properties;
14. An opinion of counsel to the Trustee dated the Closing Date, addressed to the Underwriter, and the Community Facilities District to the effect that the Trustee is a national banking association duly organized and validly existing under the laws of the United States having full power and being qualified to enter into, accept and agree to the provisions of the Indenture, and that such documents has been duly authorized, executed and delivered by the Trustee, and, assuming due execution and delivery by the other parties thereto, constitutes the legal, valid and binding obligation of the Trustee, enforceable in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors’ rights in general and except as such enforceability may be limited by the application of equitable principles if equitable remedies are sought;
15. A certificate of the Community Facilities District dated the Closing Date, in a form acceptable to Bond Counsel and the Underwriter, that the Bonds are not arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended;
16. A negative assurance letter of counsel to the Developer, dated the date of the Closing, addressed to the Underwriter and the Community Facilities District, in form and substance acceptable to the Underwriter and Bond Counsel;
17. A Letter of Representations from the Developer, dated the date of the Preliminary Official Statement, substantially in the form attached hereto as Exhibit B;
18. A Closing Certificate of the Developer, dated the date of the Closing, substantially in the form attached hereto as Exhibit A to the Letter of Representations from the Developer or as such Closing Certificate may be modified with the approval of the Underwriter and Disclosure Counsel;
19. The Continuing Disclosure Certificate executed and delivered by the Developer in substantially the form attached as Appendix G to the Official Statement; Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 186
Menifee Mayor and City Council
November 6, 2024
Page
1281 of 1464
17 20. An opinion of Kutak Rock LLP, counsel to the Underwriter (“Underwriter’s Counsel”), dated the date of Closing and addressed to the Underwriter in form and substance acceptable to the Underwriter; and
21. Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the material representations and warranties of the Community Facilities District contained herein, and of the statements and information contained in the Official Statement and the due performance or satisfaction by the Community Facilities District at or prior to the Closing of all agreements then to be performed and all conditions then to be satisfied by the Community Facilities District in connection with the transactions contemplated hereby and by the Indenture and the Official Statement.
If the Community Facilities District shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement shall terminate and neither the Community Facilities District nor the Underwriter shall be under any further obligation hereunder, except that the respective obligations of the Underwriter and the Community Facilities District set forth in Section 5 hereof shall continue in full force and effect.
5. Expenses. Whether or not the transactions contemplated by this Purchase Agreement are consummated, the Underwriter shall be under no obligation to pay, and the Community Facilities District shall pay only from the proceeds of the Bonds, or any other legally available funds of the City, or the Community Facilities District, but only as the Community Facilities District and such other party providing such services may agree, all expenses and costs of the Community Facilities District incident to the performance of its obligations in connection with the authorization, execution, sale and delivery of the Bonds to the Underwriter, including, without limitation, printing costs, rating agency fees and charges, initial fees of the Trustee, including fees and disbursements of its counsel, if any, fees and disbursements of Bond Counsel, Disclosure Counsel and other professional advisors employed by the City, costs of preparation, printing, signing, transportation, delivery and safekeeping of the Bonds and for expenses (included in the expense component of the Underwriter’s discount) incurred by the Underwriter on behalf of the City’s employees which are incidental to implementing this Purchase Agreement, including, but not limited to, meals, transportation, lodging, and entertainment of those employees. The Underwriter shall pay all out-of-pocket expenses of the Underwriter, including, without limitation, advertising expenses, the California Debt and Investment Advisory Commission fee, CUSIP Services Bureau charges, regulatory fees imposed on new securities issuers and any and all other expenses incurred by the Underwriter in connection with the public offering and distribution of the Bonds, including fees and disbursements of Underwriter’s Counsel. Any meals in connection with or adjacent to meetings, rating agency presentations, pricing activities or other transaction-related activities shall be considered an expense of the transaction and included in the expense component of the Underwriter’s discount.
6. Notices. Any notice of other communication to be given to the Community Facilities District or the City under this Purchase Agreement may be given by delivering the same in writing to the City of Menifee, 29844 Haun Road, Menifee, California 92586, Attention: City Manager; any notice or other communication to be given to the Underwriter under this Purchase Agreement may be given by delivering the same in writing to Raymond James & Associates, Inc., 10250 Constellation Boulevard, Suite 850, Los Angeles, California 90067, Attention: Public Finance Department.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 187
Menifee Mayor and City Council
November 6, 2024
Page
1282 of 1464
18 7. Parties In Interest. This Purchase Agreement is made solely for the benefit of the Community Facilities District and Underwriter (including any successors or assignees of the Underwriter) and no other person shall acquire or have any right hereunder or by virtue hereof.
8. Survival of Representations and Warranties. The representations and warranties of the Community Facilities District under this Purchase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing and regardless of any investigations made by or on behalf of the Underwriter (or statements as to the results of such investigations) concerning such representations and statements of the Community Facilities District and regardless of delivery of and payment for the Bonds.
9. Execution in Counterparts. This Purchase Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.
10. No Prior Agreements. This Purchase Agreement supersedes and replaces all prior negotiations, agreements and understanding among the parties hereto in relation to the sale of the Bonds by the Community Facilities District.
11. Governing Law. This Purchase Agreement shall be governed by the laws of the State of California.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 188
Menifee Mayor and City Council
November 6, 2024
Page
1283 of 1464
S-1
12. Effective Date. This Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the Community Facilities District and shall be valid and enforceable as of the time of such acceptance.
Very truly yours,
RAYMOND JAMES & ASSOCIATES, INC.
By:
Its: Authorized Officer
The foregoing is hereby agreed to and accepted as of the date first above written:
COMMUNITY FACILITIES DISTRICT
NO. 2023-1 (ROCKPORT RANCH) OF
THE CITY OF MENIFEE
By:
Authorized Officer
Time of Execution: _____________ p.m. California time
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 189
Menifee Mayor and City Council
November 6, 2024
Page
1284 of 1464
A-1
EXHIBIT A
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
MATURITY SCHEDULE
Maturity
(September 1)
Principal
Amount
Interest
Rate Yield Price
10% Test
Satisfied*
10% Test
Not
Satisfied
Subject to
Hold-The-
Offering-
Price Rule
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
20__(T)
20__(T)
20__(T)
20__(T)
_________________
(T) Term Bond.
(C) Priced to optional call at [par] on September 1, 20__. * At the time of execution of this Purchase Agreement and assuming orders are confirmed by the close of the business day immediately following the date of this Purchase Agreement.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 190
Menifee Mayor and City Council
November 6, 2024
Page
1285 of 1464
B-1
EXHIBIT B
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
LETTER OF REPRESENTATIONS OF LENNAR HOMES OF CALIFORNIA, LLC [POS Date]
Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee
29844 Haun Road
Menifee, California 92586
Raymond James & Associates, Inc.
10250 Constellation Boulevard, Suite 850
Los Angeles, California 90067
Ladies and Gentlemen:
The undersigned certifies and represents that he or she is duly authorized on behalf of Lennar Homes of California, LLC, a California limited liability company (the “Developer”), to execute and deliver this Letter of Representations of Lennar Homes of California, LLC (this “Letter of Representations”) in connection with the issuance, sale and delivery by Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee (the “Community Facilities District”) of the Bonds captioned above (the “Bonds”).
Capitalized terms used but not defined in this Letter of Representations have the same meanings as are set forth in the Bond Purchase Agreement with respect to the Bonds between Raymond James & Associates, Inc., as underwriter (the “Underwriter”), and the Community Facilities District (the “Bond Purchase Agreement”).
This Letter of Representations is delivered pursuant to and in satisfaction of Section 4(F)(17) of the Bond Purchase Agreement.
As used in this Letter of Representations, the phrase “Actual Knowledge of the Undersigned” means, as of the date of this Letter of Representations, the actual (as opposed to constructive) knowledge that the undersigned currently has or has obtained through (i) interviews with such current officers and responsible employees of the Developer as the undersigned has reasonably determined are likely, in the ordinary course of their respective duties, to have knowledge of the matters set forth in this Letter of Representations, and/or (ii) review of documents reasonably available to the undersigned and which the undersigned reasonably deemed necessary for the undersigned to obtain knowledge of the matters set forth in this Letter of Representations. The undersigned has not conducted any extraordinary inspection or inquiry other than such inspections or inquiries as are prudent and customary in connection with the ordinary course of the Developer’s current business and operations.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 191
Menifee Mayor and City Council
November 6, 2024
Page
1286 of 1464
B-2
The undersigned has not contacted individuals who are no longer employed by the Developer or its Affiliates. The Developer further notes that Lennar Corporation, a Delaware corporation (“Lennar Corporation”), completed a merger with CalAtlantic Group, Inc., a Delaware corporation (now CalAtlantic Group, LLC, herein “CalAtlantic”) in February, 2018, pursuant to which CalAtlantic merged with and into a subsidiary of Lennar Corporation, with the subsidiary of Lennar Corporation being the surviving entity. Separate and apart from Lennar Corporation’s due diligence efforts for purposes of completing the acquisition of CalAtlantic, for purposes of this Letter of Representations, individuals who were employees and officers of CalAtlantic and its subsidiaries prior to the merger have not been consulted or contacted and documents entered into by CalAtlantic and its subsidiaries or related to their properties and projects have not been reviewed.
As used in this Letter of Representations, the term “Affiliate” of the Developer means any other Person (i) who presently directly, or indirectly through one or more intermediaries, is currently controlling, controlled by or under common control with the Developer, and (ii) for whom information, including financial information or operating data concerning such Person is material to potential investors in their evaluation of the Community Facilities District and investment decision regarding the Bonds (i.e., information regarding such Person’s assets or funds that would materially affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay its Special Tax (as defined herein) on the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency). “Person” means an individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, any unincorporated organization, or a government or political subdivision thereof. For purposes hereof, the term “control” (including the terms “controlling,” “controlled by,” or “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise. For purposes of this Letter of Representations, CalAtlantic, and its direct and indirect subsidiaries, shall not be considered an “Affiliate” of the Developer.
As used in this Letter of Representations, the term “Property” means the property currently owned by the Developer within the Community Facilities District, as further described in the Preliminary Official Statement.
The undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer or representative of the Developer, and the undersigned, on behalf of the Developer, further certifies as follows:
1. The Developer is duly organized and validly existing under the laws of the State of California and in good standing under the laws of the State of California, and has all requisite limited liability company right, power and authority: (i) to execute and deliver this Letter of Representations; (ii) to execute and deliver the Developer Continuing Disclosure Certificate to be executed by the Developer (the “Continuing Disclosure Certificate”); and (iii) to undertake all of the transactions on its part described in the Preliminary Official Statement.
2. As set forth in the Preliminary Official Statement, title to the Property is held in the name of the Developer. The undersigned, on behalf of the Developer, makes the representations herein with respect to all the Property. Except as otherwise described in the Preliminary Official Statement, the Developer is and the Developer’s current expectations are that the Developer shall remain the party responsible for the development of the Property. The Developer has not entered into an agreement for development or management of the Property by any other entity, except such Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 192
Menifee Mayor and City Council
November 6, 2024
Page
1287 of 1464
B-3
subcontracts, consultant agreements, and similar agreements for land development activities associated with the Developer’s development plan as are entered into in the ordinary course of business.
3. Except as set forth in the Preliminary Official Statement, no action, suit, proceeding, inquiry, or investigation at law or in equity, before or by any court, regulatory agency, or public board, or body is pending against the Developer (with proper service of process to the Developer having been accomplished) or, to the Actual Knowledge of the Undersigned, is pending against any current Affiliate (with proper service of process to such Affiliate having been accomplished) or to the Actual Knowledge of the Undersigned is threatened in writing against the Developer or any such Affiliate (a) to restrain or enjoin the collection of Special Taxes or other sums pledged or to be pledged to pay the principal of and interest on the Bonds (e.g., a reserve account established under the Indenture), (b) to restrain or enjoin the development of the Property as described in the Preliminary Official Statement, (c) in any way contesting or affecting the validity of the Special Taxes, or (d) which, if successful, is reasonably likely to materially and adversely affect the Developer’s ability to complete the development and sale of the Property as described in the Preliminary Official Statement or to pay the Special Taxes levied against the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency or which challenges or questions the validity or enforceability of the Bonds or the Continuing Disclosure Certificate to be executed by the Developer in connection with the issuance of the Bonds.
4. As of the date of the Preliminary Official Statement, to the Actual Knowledge of the Undersigned, the information contained therein solely with respect to the Developer, its Affiliates, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Affiliates (including, if material to the Developer’s development plan or the Developer’s financing plan, other loans of such Affiliates) as set forth under the sections of the Preliminary Official Statement captioned “PROPERTY OWNERSHIP AND THE DEVELOPMENT” and “CONTINUING DISCLOSURE – Developer Continuing Disclosure” (excluding therefrom in all cases information regarding the Appraisal Report (as defined herein), market value ratios and annual special tax ratios, and information that is identified as having been provided by a source other than the Developer), is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
5. Except as described in the Preliminary Official Statement, there are no material loans outstanding and unpaid and no material lines of credit of the Developer or its Affiliates, that are secured by an interest in the Property. Neither the Developer nor, to the Actual Knowledge of the Undersigned, any of its Affiliates is currently in material default on any loans, lines of credit, or other obligation to repay borrowed money related to the development of the Property or any other project which default is reasonably likely to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Taxes levied against the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency.
6. To the Actual Knowledge of the Undersigned, the Developer is not aware that any of the Property has a current liability with respect to the presence of a substance presently classified as hazardous under the federal Comprehensive Environmental Response, Compensation and Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 193
Menifee Mayor and City Council
November 6, 2024
Page
1288 of 1464
B-4
Liability Act of 1980 or applicable California law or is adversely affected by the presence of endangered or threatened species or habitat for endangered or threatened species.
7. The Developer covenants that, while the Bonds or any refunding obligations related thereto are outstanding, the Developer and its Affiliates which it controls will not bring any action, suit, proceeding, inquiry, or investigation at law or in equity, before any court, regulatory agency, public board, or body, that in any way seeks to challenge or overturn the formation of the Community Facilities District, to challenge the adoption of the ordinance of the Community Facilities District levying Special Taxes within the Community Facilities District, to invalidate the Community Facilities District or any of the Bonds or any refunding bonds related thereto, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notices of special tax lien relating thereto. The foregoing covenant shall not prevent the Developer and its Affiliates in any way from bringing any other action, proceeding, inquiry, or investigation at law or in equity, before any court, regulatory agency, public board, or body including, without limitation, (a) an action or suit contending that the Special Tax has not been levied in accordance with the methodologies contained in the Rate and Method of Apportionment of Special Taxes pursuant to which Special Taxes are levied, (b) an action or suit with respect to the application or use of the Special Taxes levied and collected, or (c) an action or suit to enforce the obligations of the City and/or the Community Facilities District under the Community Facilities District Resolution of Issuance, the Indenture, the Continuing Disclosure Certificate or any other agreements among the Developer or its Affiliates, the City and/or the Community Facilities District or to which the Developer or its Affiliates is a party or beneficiary.
8. The Developer consents to the issuance of the Bonds. The Developer expects that the proceeds of the Bonds will be used as described in the Preliminary Official Statement.
9. The Developer intends to comply with the provision of the Mello-Roos Community Facilities District Act of 1982, as amended relating to the Notice of Special Tax described in Government Code Section 53341.5 in connection with the sale of the Property, or portions thereof.
10. To the Actual Knowledge of the Undersigned, the Developer is able to pay its bills as they become due and no legal proceedings are pending against the Developer (with proper service of process having been accomplished) or, to the Actual Knowledge of the Undersigned, threatened in writing in which the Developer may be adjudicated as bankrupt or discharged from any and all of its debts or obligations, or granted an extension of time to pay its debts or obligations, or be allowed to reorganize or readjust its debts, or be subject to control or supervision of the Federal Deposit Insurance Corporation.
11. To the Actual Knowledge of the Undersigned, Affiliates of the Developer are able to pay their bills as they become due and no legal proceedings are pending against any Affiliate of the Developer (with proper service of process having been accomplished) or to the Actual Knowledge of the Undersigned, threatened in writing in which the Affiliates of the Developer may be adjudicated as bankrupt or discharged from any or all of their debts or obligations, or granted an extension of time to pay their debt or obligations, or be allowed to reorganize or readjust their debts or obligations, or be subject to control or supervision of the Federal Deposit Insurance Corporation, which is reasonably likely to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Taxes levied against the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 194
Menifee Mayor and City Council
November 6, 2024
Page
1289 of 1464
B-5
12. The Developer has been developing or has been involved in the development of numerous projects over an extended period of time. It is likely that the Developer has been delinquent at one time or another in the payment of ad valorem property taxes, special taxes, or special assessments. However, to the Actual Knowledge of the Undersigned, during the last five years, neither the Developer nor any current Affiliate has, during the period of its ownership, been delinquent to any material extent in the payment of any ad valorem property tax, special assessment, or special tax on property in California owned by the Developer or any such Affiliate (during the period of their ownership) included within the boundaries of a community facilities district or an assessment district in California that (a) caused a draw on a reserve fund relating to such assessment district or community facilities district financing or (b) resulted in a foreclosure action being commenced against the delinquent Developer or Affiliate by a court filing.
13. The Developer has not filed for the reassessment of the assessed value of portions of the Property, other than in connection with the sale of homes to individual homebuyers.
14. To the Actual Knowledge of the Undersigned, there are no claims, disputes, suits, actions or contingent liabilities by and among the Developer, its Affiliates, or any contractors working on the development of the Property that are reasonably likely to materially and adversely affect the Developer’s ability to develop the Property as described in the Preliminary Official Statement or to pay the Special Taxes levied against the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency.
15. Based upon the current development plans, including, without limitation, the current budget and subject to economic conditions and risks generally inherent in the development of real property, including, but not limited to, the risks described in the Preliminary Official Statement under the section entitled “SPECIAL RISK FACTORS,” to the Actual Knowledge of the Undersigned, the Developer presently anticipates that it will have sufficient funds to complete the development of the Property as described in the Preliminary Official Statement and to pay the Special Taxes levied against the portion of the Property then owned by the Developer (to the extent the responsibility of the Developer) prior to delinquency and does not anticipate that the City or the Community Facilities District will be required to resort to a draw on the Reserve Account of the Special Tax Fund for payment of principal of or interest on the Bonds due to the Developer’s nonpayment of Special Taxes. However, neither the Developer nor any of its Affiliates are obligated to pay the Special Taxes or to make any additional capital contribution or loan to the Developer at any time, and the Developer reserves the right to change its respective development plan and financing plan for the Property at any time without notice, and there is no recourse against the Developer for the failure to pay the Special Taxes other than the filing of a foreclosure action.
16. An appraisal of the taxable properties within the Community Facilities District, dated _______, 2024 (the “Appraisal Report”), with a date of value of August 30, 2024 (the “Date of Value”), was prepared by Integra Realty Resources (the “Appraiser”). The Appraisal Report estimates the market value of the appraised taxable properties within the Community Facilities District as of the Date of Value. To Actual Knowledge of the Undersigned, all information submitted by, or on behalf of and authorized by, the Developer to the Appraiser and contained in the sections of the Appraisal Report highlighted in yellow in Exhibit B attached hereto, was true and correct in all material respects as of the Date of Value.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 195
Menifee Mayor and City Council
November 6, 2024
Page
1290 of 1464
B-6
17. If between the date hereof and the Closing Date any event relating to or affecting the Developer, its Affiliates, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Affiliates (including, if material to the Developer’s development plan or the Developer’s financing plan, other loans of such Affiliates) shall occur of which the Developer has actual knowledge that would cause the information under the sections of the Preliminary Official Statement indicated in paragraph 4 hereof (and subject to the limitations and exclusions contained in paragraph 4 hereof), to contain an untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the Developer shall notify the City, the Community Facilities District and the Underwriter and if in the opinion of counsel to the City or the Underwriter such event requires the preparation and publication of a supplement or amendment to the information described in the section of the Preliminary Official Statement referenced in paragraph 4 hereof (and subject to the limitations and exclusions contained in paragraph 4 hereof), the Developer shall reasonably cooperate with the City and the Community Facilities District in the preparation of an amendment or supplement to the Preliminary Official Statement in form and substance satisfactory to counsel to the City, the Community Facilities District and to the Underwriter.
18. The Developer agrees to deliver a Closing Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds in substantially the form attached as Exhibit A.
19. On behalf of the Developer, the undersigned has reviewed the contents of this Letter of Representations and has consulted with counsel to the Developer regarding the meaning of its contents. The undersigned acknowledges and understands that a variety of state and federal securities laws, including but not limited to the Securities Act of 1933 and Rule 10b-5 promulgated under the Securities Exchange Act of 1934, may apply to the Developer and that under some circumstances certification as to the matters set forth in this Letter of Representations, without additional disclosures or other action, may not fully discharge all duties and obligations of the Developer under such securities laws.
The undersigned has executed this Letter of Representations solely in his or her capacity as an authorized officer or representative of the Developer and he or she will have no personal liability arising from or relating to this Letter of Representations. Any liability arising from or relating to this Letter of Representations may only be asserted against the Developer.
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By:
Name:
Title:
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 196
Menifee Mayor and City Council
November 6, 2024
Page
1291 of 1464
B-7
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 197
Menifee Mayor and City Council
November 6, 2024
Page
1292 of 1464
B-8
EXHIBIT A
$____________
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
CLOSING CERTIFICATE OF LENNAR HOMES OF CALIFORNIA, LLC
[Closing Date]
Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee
29844 Haun Road
Menifee, California 92586
Raymond James & Associates, Inc.
10250 Constellation Boulevard, Suite 850
Los Angeles, California 90067
Ladies and Gentlemen:
Reference is made to the above-captioned bonds (the “Bonds”) and to the Bond Purchase Agreement, dated [BPA Date] (the “Bond Purchase Agreement”), entered into in connection therewith. This Closing Certificate of Lennar Homes of California, LLC (the “Closing Certificate”) is delivered pursuant to and in satisfaction of Section 4(F)(18) of the Bond Purchase Agreement.
Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Letter of Representations of Lennar Homes of California, LLC (the “Letter of Representations”), dated [POS Date], delivered by Lennar Homes of California, LLC, a California limited liability company (the “Developer”).
The undersigned certifies that he or she is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer or representative of the Developer, and the undersigned, on behalf of the Developer, further certifies as follows:
1. The Developer has received the final Official Statement relating to the Bonds, dated [BPA Date] (the “Official Statement”). To the Actual Knowledge of the Undersigned, each statement, representation and warranty made in the Letter of Representations is true and correct in all material respects on and as of the date hereof with the same effect as if made on the date hereof, except that all references therein to the Preliminary Official Statement shall be deemed to be references to the final Official Statement.
2. To the Actual Knowledge of the Undersigned, no event has occurred since the date of the Preliminary Official Statement affecting the statements and information described in paragraph 4 of the Letter of Representations (and subject to the limitations and exclusions contained in paragraph Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 198
Menifee Mayor and City Council
November 6, 2024
Page
1293 of 1464
B-9
4 of the Letter of Representations) relating to the Developer, its Affiliates, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Affiliates (including, if material to the Developer’s development plan or the Developer’s financing plan, other loans of such Affiliates), which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make such statements and information contained in the Official Statement not misleading in any material respect.
3. For the period through 25 days after the “end of the underwriting period” as defined in the Bond Purchase Agreement to mean the Closing Date unless the Underwriter gives notice to the contrary, if any event relating to or affecting the Developer, its Affiliates, the proposed development of the Property, ownership of the Property, the Developer’s development plan, the Developer’s financing plan, the Developer’s lenders, if any, and contractual arrangements of the Developer or any Affiliates (including, if material to the Developer’s development plan or the Developer’s financing plan, other loans of such Affiliates) shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the City or the Community Facilities District, to amend or supplement the Official Statement in order to make the information under the sections of the Official Statement indicated in paragraph 4 of the Letter of Representations (and subject to the limitations and exclusions contained in paragraph 4 of the Letter of Representations) not misleading in the light of the circumstances under which they were made, the Developer shall reasonably cooperate with the City, the Community Facilities District and the Underwriter in the preparation and publication of a supplement or amendment to the information described in the section of the Official Statement referenced in paragraph 4 of the Letter of Representations (and subject to the limitations and exclusions contained in paragraph 4 of the Letter of Representations), in form and substance satisfactory to the Underwriter and counsel to the City and the Community Facilities District which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
4. The Developer has duly executed and delivered the Continuing Disclosure Certificate.
The undersigned has executed this Closing Certificate solely in his or her capacity as an authorized officer or representative of the Developer and he or she will have no personal liability arising from or relating to this Closing Certificate. Any liability arising from or relating to this Closing Certificate may only be asserted against the Developer.
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By:
Name:
Title:
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 199
Menifee Mayor and City Council
November 6, 2024
Page
1294 of 1464
B-10
EXHIBIT B
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
DEVELOPER PROVIDED INFORMATION IN APPRAISAL REPORT
See attached.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 200
Menifee Mayor and City Council
November 6, 2024
Page
1295 of 1464
C-1
EXHIBIT C
$____________
COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ROCKPORT RANCH)
OF THE CITY OF MENIFEE
SPECIAL TAX BONDS, SERIES 2024
FORM OF ISSUE PRICE CERTIFICATE
The undersigned, on behalf of Raymond James & Associates, Inc. (“Raymond James”) hereby certifies the following based upon the information available to it with respect to the sale and issuance of the above-captioned bonds (the “Bonds”).
1.Sale of the General Rule Maturities. As of the date of this certificate, for each Maturity of the General Rule Maturities, the first price at which at least 10% of such Maturity was sold to the Public is the respective price listed in Schedule A.
2.Defined Terms.
(a)General Rule Maturities means those Maturities of the Bonds listed in Schedule A hereto as the “General Rule Maturities.”
(b)Issuer means the Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee.
(c)Maturity means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate maturities.
(d)Public means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter.
The term “related party” for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (e)Underwriter means (i) any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or a party to a retail distribution agreement participating in the initial sale of the Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents Raymond James’ interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Stradling Yocca Carlson & Rauth LLP in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 201
Menifee Mayor and City Council
November 6, 2024
Page
1296 of 1464
C-2
8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. However, notwithstanding the foregoing, we remind you that Raymond James is not an accountant or actuary, nor is Raymond James engaged in the practice of law. Accordingly, while Raymond James believes the calculations described above to be correct, it does not warrant their validity for purposes of Sections 103 and 141 through 150 of the Code or make any representation as to the legal sufficiency of the factual matters set forth herein. Except as expressly set forth above, the certifications set forth herein may not be relied upon or used by any third party or for any other purpose.
RAYMOND JAMES & ASSOCIATES, INC.
By:
Name:
Dated: [Closing Date]
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 202
Menifee Mayor and City Council
November 6, 2024
Page
1297 of 1464
C-3
SCHEDULE A
SALE PRICES OF THE GENERAL RULE MATURITIES
(To be attached)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 203
Menifee Mayor and City Council
November 6, 2024
Page
1298 of 1464
Integra Realty Resources
Los Angeles
Appraisal of Real Property
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Residential Subdivision
Sunset Pier Road
Menifee, Riverside County, California 92584
Prepared For:
City of Menifee
Date of the Report:
September 27, 2024
Report Format:
Appraisal Report
IRR - Los Angeles
File Number: 219-2024-0055
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 204
Menifee Mayor and City Council
November 6, 2024
Page
1299 of 1464
Subject Photographs
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Sunset Pier Road
Menifee, California
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 205
Menifee Mayor and City Council
November 6, 2024
Page
1300 of 1464
Aerial Photograph
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 206
Menifee Mayor and City Council
November 6, 2024
Page
1301 of 1464
Integra Realty Resources
Los Angeles
12100 Willshire Blvd.
Suite 800
Los Angeles, CA, 90025
T 213.984.4425
F 916.435.4774
www.irr.com
September 27, 2024
Travis Hickey
Chief Financial Officer
City of Menifee
29844 Haun Road
Menifee, CA 92586
SUBJECT: Market Value Appraisal
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Sunset Pier Road
Menifee, Riverside County, California 92584
IRR - Los Angeles File No. 219-2024-0055
Dear Mr. Hickey:
Integra Realty Resources – Los Angeles is pleased to submit the accompanying appraisal of the referenced property. The purpose of the appraisal is to develop an opinion of the market value by ownership, subject to a hypothetical condition, pertaining to the fee simple interest in the property, as well as the aggregate, or cumulative, value of the appraised properties. The client for the assignment is City of Menifee and the intended use of the report is for bond underwriting purposes.
The subject is the City of Menifee Community Facilities District (CFD) No. 2023-1 (Rockport Ranch) (“CFD No. 2023-1”), which is generally located at the southwest corner of Old Newport Road and Briggs Road, within the city of Menifee, Riverside County, California. The subject is comprised three communities North, West, and South Shore at Rockport Ranch, which have 109, 96, and 100 lots, respectively. The communities have typical lot sizes ranging from 3,600 to 6,500 square feet. North and South Shore at Rockport Ranch have a traditional lot configuration, while West Shore at Rockport Ranch has an 8-lot cluster configuration. All three communities are being developed by Lennar Homes. As of the date of value, August 30, 2024, the subject consists of partially-improved lots, improved lots with homes under construction, and completed homes. The appraised property comprises 112 completed and sold homes, six completed (unsold) homes, 90 improved lots with homes under construction at various stages and 46 partially improved lots. In total, the appraised properties comprise 254 Assessor's Parcels; the balance of City of Menifee Community Facilities District No. 2023-1 (Rockport Ranch) is 51 completed and sold homes reflected on the County of Riverside Assessor's Tax Roll with a complete assessed value for both land and Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 207
Menifee Mayor and City Council
November 6, 2024
Page
1302 of 1464
Travis Hickey
City of Menifee
September 27, 2024
improvements. As requested, these 51 Assessor's Parcels are not appraised herein; rather, the aggregate, or cumulative, Assessed Value according to the 2024/25 Tax Roll is presented herein for Bond Financing purposes. A more detailed legal and physical description of the subject property is contained within the attached report.
The appraisal conforms to the Uniform Standards of Professional Appraisal Practice (USPAP), the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute, and applicable state appraisal regulations. The Appraisal Report is also prepared in accordance with the Appraisal Standards for Land Secured Financing published by the California Debt and Investment Advisory Commission (CDIAC).
Standards Rule 2-2 (Content of a Real Property Appraisal Report) contained in the Uniform Standards of Professional Appraisal Practice (USPAP) requires each written real property appraisal report to be prepared as either an Appraisal Report or a Restricted Appraisal Report. This report is prepared as an Appraisal Report as defined by USPAP under Standards Rule 2-2(a), and incorporates practical explanation of the data, reasoning, and analysis that were used to develop the opinion of value.
Based on the valuation analysis in the accompanying Appraisal Report, and subject to the hypothetical condition, definitions, assumptions, and limiting conditions expressed in the report, the concluded opinions of value, as of the date of value, August 30, 2024, is as follows:
Market Value by Ownership
Lots/Parcels Lot/Home Remaining Site
Development Costs
Permits and
Fees
Value per
Component/Homes Value Market Value (Rd.)
Lennar Homes of California, LLC / AG EHC II (LEN) CA 1, L.P.
Partially-Improved Lots
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
Homes Under Construction
20 21
5 $224,000
$232,500
$194,000
($47,985)
($47,985)
($47,985)
-
-
-
$176,015
$184,515
$146,015
$3,520,000
$3,875,000
$730,000
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
Completed Homes
35 22
33 $224,000
$232,500
$194,000
($47,985)
($47,985)
($47,985)
$22,600
$22,600
$22,600
$198,615
$207,115
$168,615
$6,952,000
$4,557,000
$5,564,000
North Shore at Rockport Ranch
South Shore at Rockport Ranch
2 4
$530,000
$550,000
-
-
-
-
$530,000
$550,000
$1,060,000
$2,200,000
(Not-Less-Than)
(Not-Less-Than)
Total - Lennar Homes of California, LLC / AG EHC II (LEN) CA 1, L.P. 142 $28,458,000 Individual Homeowners
Completed Homes
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
33 39
40 $530,000
$550,000
$515,000
-
-
-
-
-
-
$530,000
$550,000
$515,000
$17,490,000
$21,450,000
$20,600,000
(Not-Less-Than)
(Not-Less-Than)
(Not-Less-Than)
Total - Individual Homeowners 112
254
$59,540,000
$87,998,000Aggregate, or Cumulative, Appraised Values
Aggregate, or Cumulative, Assessed Values 51 $28,930,504 Total Aggregate, or Cumulative, Value of CFD No. 2023-1 (Rockport Ranch)
305 $116,928,504
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 208
Menifee Mayor and City Council
November 6, 2024
Page
1303 of 1464
Travis Hickey
City of Menifee
September 27, 2024
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. (None)
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.
1. The value derived herein is based on the hypothetical condition that certain impact fees to be financed by the CFD No. 2023-1 Revenue Bonds, Series 2024, have been paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
The opinions of value represent a "not-less-than" value due to the fact we were requested to provide a market value for the smallest floor plan in each community improved with a completed home without a complete assessed improvement value reflected on the County of Riverside Assessor's Tax Roll.
Please note the aggregate of the appraised values is not the market value of the appraised properties in bulk. As defined by The Dictionary of Real Estate Appraisal, an aggregate value is the "total of multiple market value conclusions." For purposes of this Appraisal Report, market value is estimated by ownership.
As a condition of this assignment, the Assessed Values for certain Assessor's Parcels with completed and sold homes with a complete Assessed Value for both Land and Improvements (improvement value greater than $300,000) is presented herein for illustration purposes, which will be relied upon for underwriting purposes.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 209
Menifee Mayor and City Council
November 6, 2024
Page
1304 of 1464
Travis Hickey
City of Menifee
September 27, 2024
If you have any questions or comments, please contact the undersigned. Thank you for the opportunity to be of service.
Respectfully submitted,
Integra Realty Resources - Los Angeles
Blake Fassler Kevin Ziegenmeyer, MAI
California Certified General Real Estate
Appraiser #3007274
California Certified General Real Estate
Appraiser #AG013567
Telephone: 916-435-3883
Email: [email protected]
Telephone: 916.435.3883, ext. 224
Email: [email protected]
Eric Segal, MAI
California Certified General Real Estate
Appraiser #AG026558
Telephone: 916.435.3883, ext. 228
Email: [email protected]
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 210
Menifee Mayor and City Council
November 6, 2024
Page
1305 of 1464
Table of Contents
Executive Summary 1 Valuation 47
47 48
59 71
80 81
82 83
Valuation Methodology
Market Valuation – Floor Plans
Residential Lot Valuation
Land Residual Analysis
Reconciliation of Lot Value
Market Value by Ownership
Exposure Time
Identification of the Appraisal Problem
Subject Description
Sale History
Pending Transactions
Appraisal Purpose
Value Type Definitions
Property Rights Definitions
Client and Intended User(s)
Intended Use
Applicable Requirements
Report Format
2 2
2 3
3 3
4 4
4 4
4 5
5 Marketing Time
Certification 84
86Assumptions and Limiting Conditions
Prior Services
Appraiser Competency
Addenda
A. Appraiser Qualifications
B. DefinitionsScope of Work 6 C. Preliminary Title Report D. Comparable Data
Land Sales - North Shore at Rockport
Ranch
Economic Analysis
Area Analysis – Riverside County
Introduction
8 8
8 Population 8
9 Land Sales - West Shore at Rockport
RanchEmployment & Economy
Household Income
Transportation
Recreation & Culture
Conclusion
11 11
12 12
15 19
Surrounding Area Analysis
Residential Market Analysis
Property Analysis 27
27 37
42 45
Land Description and Analysis
Proposed Improvements Description
Real Estate Taxes
Highest and Best Use
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 211
Menifee Mayor and City Council
November 6, 2024
Page
1306 of 1464
Executive Summary 1
Executive Summary
Property Name
Address
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Sunset Pier Road
Menifee, Riverside County, California 92584
Property Type
Owner of Record
Tax ID
Land - Single Family Development Land
Lennar Homes of California, LLC, AG EHC II (LEN) CA 1, L.P., and Individual Homeowners 364-460-001 through -034, -037 through -052, 364-470-001 through -026, -030 through -082, 364-480-001 through -050, 364-490-001 through -072 and 364-500-001 through -054
Land Area 78.80 acres; 3,432,528 SF
Zoning Designation Rockport Ranch SP - MHDR and MDR, Rockport Ranch Specific Plan - Courtyard Residential and Single-Family Residential
Highest and Best Use Residential use
Exposure Time; Marketing Period
Effective Date of the Appraisal
Date of the Report
6-9 months; 6-9 months
August 30, 2024
September 27, 2024
Fee SimpleProperty Interest Appraised
Value Conclusion
Value Type & Appraisal Premise Interest Appraised Date of Value No. of Lots Value Conclusion Aggregate, or Cumulative, Appraised Values
Aggregate, or Cumulative, Assessed Values
Total Aggregate, or Cumulative, Value of CFD No. 2023-1 (Rockport Ranch)
Fee Simple
-
Fee Simple
August 30, 2024
-
August 30, 2024
254
51 305
$87,998,000
$28,930,504
$116,928,504
The values reported above are subject to the definitions, assumptions, and limiting conditions set forth in the accompanying report of which this summary is a part. No party other than City of Menifee and its associated finance team may use or rely on the information, opinions, and conclusions contained in the report. It is assumed that the users of the report have read the entire report, including all of the definitions, assumptions, and limiting conditions contained therein.
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. (None)
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.
1. The value derived herein is based on the hypothetical condition that certain impact fees to be financed by the CFD No. 2023-1 Revenue Bonds, Series 2024, have been paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 212
Menifee Mayor and City Council
November 6, 2024
Page
1307 of 1464
Subject Description 2
Identification of the Appraisal Problem
Subject Description
The subject is the City of Menifee Community Facilities District (CFD) No. 2023-1 (Rockport Ranch) (“CFD No. 2023-1”), which is generally located at the southwest corner of Old Newport Road and Briggs Road, within the city of Menifee, Riverside County, California. The subject is comprised three communities North, West, and South Shore at Rockport Ranch, which have 109, 96, and 100 lots, respectively. The communities have typical lot sizes ranging from 3,600 to 6,500 square feet. North and South Shore at Rockport Ranch have a traditional lot configuration, while West Shore at Rockport Ranch has an 8-lot cluster configuration. All three communities are being developed by Lennar Homes.
As of the date of value, August 30, 2024, the subject consists of partially-improved lots, improved lots with homes under construction, and completed homes. The appraised property comprises 112 completed and sold homes, six completed (unsold) homes, 90 improved lots with homes under construction at various stages and 46 partially improved lots. In total, the appraised properties comprise 254 Assessor's Parcels; the balance of City of Menifee Community Facilities District No. 2023-1 (Rockport Ranch) is 51 completed and sold homes reflected on the County of Riverside Assessor's Tax Roll with a complete assessed value for both land and improvements. As requested, these 51 Assessor's Parcels are not appraised herein; rather, the aggregate, or cumulative, Assessed Value according to the 2024/25 Tax Roll is presented herein for Bond Financing purposes. A legal description of the property is provided in the addenda.
Property Identification
Property Name
Address
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Sunset Pier Road
Menifee, California 92584
Tax ID 364-460-001 through -034, -037 through -052, 364-470-001 through -026, -030 through -082, 364-480-001 through -050, 364-490-001 through -072 and 364-500-001 through -054 Owner of Record Lennar Homes of California, LLC, AG EHC II (LEN) CA 1, L.P., and Individual Homeowners Sale History
To the best of our knowledge, no sale or transfer of ownership has taken place within a three-year period prior to the effective appraisal date and to the best of our knowledge the property is not currently being marketed for sale in bulk.
Lennar Homes of California, Inc. is utilizing a land bank (AG EHC II (LEN) CA 1, L.P.) to serve as a financing mechanism, which is relatively commonplace for transactions involving national homebuilders, especially within master planned communities such as the subject. Lennar had the option to acquire residential lots over time typically pursuant to a takedown schedule. This transaction is not considered an arm’s length transfer of the subject lots, as defined; thus, no further consideration is warranted. For purposes of analysis herein, there is no delineation between Lennar Homes of California, Inc. and AG EHC II (LEN) CA 1, L.P. in the determination of market value, in bulk, of the properties held by the master developer.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 213
Menifee Mayor and City Council
November 6, 2024
Page
1308 of 1464
Pending Transactions 3
Based on the scope of work for this assignment, a detailed sales history was not performed on a parcel-by-parcel basis. From information provided and the analysis included in this report, it is our understanding prior and pending home sales within the past 12 months were negotiated and transferred at prices consistent with market conditions as of the date of the sale.
Pending Transactions
Based on discussions with the appropriate contacts, the property is not subject to an agreement of sale or an option to buy, nor is it listed for sale, in bulk as of the effective appraisal date. However, some individual homes that are under construction are in contract from the homebuilder to individual homeowners.
Appraisal Purpose
The purpose of this Appraisal Report is to estimate the market value (fee simple estate), by Assessor’s parcel, and the cumulative, or aggregate value of the appraised properties comprising City of Menifee CFD No. 2023-1 (Rockport Ranch), subject to the hypothetical condition certain proceeds from the 2024 Special Tax Bonds will be available to finance the certain impact fees, as of the effective date of the appraisal, August 30, 2024. The date of the report is September 27, 2024. The appraisal is valid only as of the stated effective date. The home values are based on a “not-less-than” value for the smallest floor plan within each community with a completed home, without consideration for upgrades and lot premiums. Further, we have excluded any contributory value of unfinished homes, but consider the value of permits and impact fees paid for lots with either construction underway or not yet begun.
Value Type Definitions
The definitions of the value types applicable to this assignment are summarized below.
Market Value
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1. 2.
Buyer and seller are typically motivated;
Both parties are well informed or well advised, and acting in what they consider their own best interests;
3. 4.
A reasonable time is allowed for exposure in the open market; Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 214
Menifee Mayor and City Council
November 6, 2024
Page
1309 of 1464
Property Rights Definitions 4
5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. 1 Assessed Value
The value of a property according to the tax rolls in ad valorem taxation; may be higher or lower than market value, or based on an assessment ratio that is a percentage of market value. 2 Property Rights Definitions
The property rights appraised which are applicable to this assignment are defined as follows.
Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.3 Client and Intended User(s)
The client is City of Menifee. The intended users are City of Menifee and its associated finance team.
No party or parties beyond the client and The Finance Team with this proposed issuance may use or rely on the information, opinions, and conclusions contained in this report; however, this appraisal report may be included in the offering document provided in connection with the issuance and sale of the Bonds.
Intended Use
The intended use of the appraisal is for bond underwriting purposes. The appraisal is not intended for any other use.
Applicable Requirements
This appraisal report conforms to the following requirements and regulations:
Uniform Standards of Professional Appraisal Practice (USPAP); Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; Applicable state appraisal regulations;
Interagency Appraisal and Evaluation Guidelines issued December 10, 2010; Appraisal Standards for Land Secured Financing published by the California Debt and Investment Advisory Commission (CDIAC) (2004).
Report Format
Standards Rule 2-2 (Content of a Real Property Appraisal Report) contained in the Uniform Standards of Professional Appraisal Practice (USPAP) requires each written real property appraisal report to be 1 Code of Federal Regulations, Title 12, Chapter I, Part 34.42[h]; also, Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472 2 Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) 3 Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 215
Menifee Mayor and City Council
November 6, 2024
Page
1310 of 1464
Prior Services 5
prepared as either an Appraisal Report or a Restricted Appraisal Report. This report is prepared as an Appraisal Report as defined by USPAP under Standards Rule 2-2(a), and incorporates practical explanation of the data, reasoning, and analysis used to develop the opinion of value.
Prior Services
USPAP requires appraisers to disclose to the client any other services they have provided in connection with the subject property in the prior three years, including valuation, consulting, property management, brokerage, or any other services. We have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment.
Appraiser Competency
No steps were necessary to meet the competency provisions established under USPAP. The assignment participants have appraised several properties similar to the subject in physical, locational, and economic characteristics, and are familiar with market conditions and trends; therefore, appraiser competency provisions are satisfied for this assignment. Appraiser qualifications and state credentials are included in the addenda of this report.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 216
Menifee Mayor and City Council
November 6, 2024
Page
1311 of 1464
Appraiser Competency 6
Scope of Work
Introduction
The appraisal development and reporting processes require gathering and analyzing information about the assignment elements necessary to properly identify the appraisal problem. The scope of work decision includes the research and analyses necessary to develop credible assignment results, given the intended use of the appraisal. Sufficient information includes disclosure of research and analyses performed and might also include disclosure of research and analyses not performed.
To determine the appropriate scope of work for the assignment, the intended use of the appraisal, the needs of the user, the complexity of the property, and other pertinent factors were considered. The concluded scope of work is described below.
Research and Analysis
The type and extent of the research and analysis conducted are detailed in individual sections of the report. Although effort has been made to confirm the arms-length nature of each sale with a party to the transaction, it is sometimes necessary to rely on secondary verification from sources deemed reliable.
Subject Property Data Sources
The legal and physical features of the subject property, including size of the site, flood plain data, seismic zone designation, property zoning, existing easements and encumbrances, access and exposure, and condition of the improvements (as applicable) were confirmed and analyzed.
Inspection
Details regarding the property inspection conducted as part of this appraisal assignment are summarized as follows:
Property Inspection
Party Inspection Type
None
On-site
Inspection Date
N/A
August 30, 2024
August 30, 2024
Blake Fassler
Kevin Ziegenmeyer, MAI
Eric Segal, MAI On-site
The aerials of the subject were taken August 25, 2024.
Valuation Methodology
Three approaches to value are typically considered when developing a market value opinion for real property. These are the cost approach, the sales comparison approach, and the income capitalization approach. Use of the approaches in this assignment is summarized as follows:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 217
Menifee Mayor and City Council
November 6, 2024
Page
1312 of 1464
Appraiser Competency 7
Approaches to Value
Approach
Cost Approach
Sales Comparison Approach
Income Capitalization Approach
Applicability to Subject
Not Applicable
Applicable
Use in Assignment
Not Uti l i zed
Utilized
Not Applicable Not Utilized
The valuation began by employing the sales comparison approach to estimate the not-less-than market value for the completed single-family homes, based on the smallest floor plan being marketed within each community.
The market value of the residential lots was estimated utilizing the sales comparison approach and land residual analysis to value. In valuing the subject lots, we selected two benchmark lot categories.
In the sales comparison approach, adjustments were applied to the prices of comparable bulk lot transactions, and a market value for each benchmark lot category was concluded. Additionally, we utilized a land residual analysis (a variation of the cost approach and income capitalization approaches), in which all direct and indirect costs are deducted from an estimate of the anticipated gross sales price of the improved home product; the resultant net sales proceeds are then discounted to present value at an anticipated discount rate over the development and absorption period to indicate the residual value of the lots. After reconciling the two approaches to value, we apply a lot size adjustment factor to account for differing lot sizes from the benchmark lot category.
As a condition of this assignment, the Assessed Values for certain Assessor's Parcels with completed and sold homes with a complete Assessed Value for both Land and Improvements (improvement value greater than $300,000) is presented herein for illustration purposes, which will be relied upon for underwriting purposes.
This appraisal will utilize the term “improved lot” to denote a residential lot that has all off-sites and on-sites in place, and includes any impact fees due up until building permit. Building permits and fees due at building permit are excluded for finished lot. Terminology for this type of improved lot can vary by market area, and is sometimes referred to as a “loaded lot”.
The market value estimates for the various taxable land use components described above were then assigned to the various assessor’s parcels comprising the appraised properties in order to derive the cumulative, or aggregate, value of CFD No. 2023-1. Our analysis excluded a typical cost approach; however, costs associated with home construction were taken into consideration as part of the land residual analysis and determination of financial feasibility. Given the limited, if any, income producing potential of the land, an income approach was not utilized.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 218
Menifee Mayor and City Council
November 6, 2024
Page
1313 of 1464
Area Analysis – Riverside County 8
Economic Analysis
Area Analysis – Riverside County
Introduction
Riverside County is part of a region known as the Inland Empire of southern California, southeast of Los Angeles. The county is bordered by San Bernardino County to the north, Orange County to the west, San Diego and Imperial counties to the south, and the state of Arizona to the east. Major cities in the county include Riverside, Moreno Valley, Corona, Murrieta and Temecula. In general, Riverside County is one of California’s fastest growing metropolitan areas as new residents locate here from the more expensive metropolitan areas of Los Angeles and San Diego.
Population
The county has a population of 2.44 million and has grown at an average rate of 0.5% per year over the past five years. The following table illustrates recent population trends for Riverside County.
Population Trends
City
Banning
Beaumont
Blythe
Calimesa
Canyon Lake
Cathedral City
Coachella
Corona
Desert Hot Springs
Eastvale
Hemet
Indian Wells
Indio
Jurupa Valley
Lake Elsinore
La Quinta
Menifee
Moreno Valley
Murrieta
2018
31,014
48,013
19,772
8,959
10,990
53,148
46,697
166,299
29,823
65,509
84,126
5,314
88,984
104,645
62,622
40,563
92,110
205,450
112,352
26,593
53,554
47,253
77,649
18,257
325,916
48,536
112,243
36,436
374,835
2019
31,068
49,913
19,530
9,015
11,021
53,308
47,318
166,937
30,019
65,735
84,354
5,351
90,112
106,056
63,270
40,663
94,710
207,190
113,207
26,473
53,695
47,410
78,095
18,397
327,076
49,655
112,561
36,878
380,040
2020
30,621
53,318
18,586
10,028
11,069
51,356
41,900
156,637
32,415
69,742
89,325
4,759
88,795
104,828
70,572
37,504
102,466
208,237
110,702
26,659
50,696
44,206
78,614
16,588
316,307
53,835
109,820
36,720
391,880
2021
30,592
53,945
17,376
10,588
11,082
51,599
41,931
157,182
32,351
70,457
89,302
4,791
89,422
105,131
71,225
37,727
104,323
208,387
111,024
24,680
50,683
44,312
78,867
16,692
309,598
54,186
109,881
36,713
394,680
2022
30,856
54,349
17,417
10,950
11,003
51,621
41,935
157,139
32,389
69,978
89,170
4,785
89,789
105,154
71,989
37,562
107,411
208,302
110,592
25,035
50,626
44,165
78,474
16,854
314,818
54,303
109,468
36,438
398,404
2023
31,250
56,590
17,265
10,962
10,949
51,433
42,462
157,005
32,608
69,514
89,918
4,774
90,837
104,983
71,973
37,979
110,034
208,289
109,998
25,037
50,615
44,092
78,948
17,012
313,676
54,103
108,899
36,336
401,693
%/Yr (5-year)
0.2%
3.6%
-2.5%
4.5%
-0.1%
-0.6%
-1.8%
-1.1%
1.9%
1.2%
1.4%
-2.0%
0.4%
0.1%
3.0%
-1.3%
3.9%
0.3%
-0.4%
-1.2%
-1.1%
-1.3%
0.3%
-1.4%
-0.8%
2.3%
Norco
Palm Desert
Palm Springs
Perris
Rancho Mirage
Riverside
San Jacinto
Temecula
Wildomar
Unincorporated
-0.6%
-0.1%
1.4%
Total 2,397,662 2,419,057 2,418,185 2,418,727 2,430,976 2,439,234 0.3% Source: California Department of Finance
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 219
Menifee Mayor and City Council
November 6, 2024
Page
1314 of 1464
Area Analysis – Riverside County 9
Riverside is the fourth most populous county in California, following Los Angeles, San Diego and Orange Counties. The majority of residents live within incorporated areas, the largest of which is the city of Riverside, with a population of just over 313,000.
Employment & Economy
The California Employment Development Department (EDD) has reported the following employment data for Riverside County over the past five years.
Employment Trends
2018
1,090,100
1,041,700
27,500
2019
1,108,100
1,061,500
19,800
2020 2021
1,133,000
1,050,000
42,000
2022
1,152,100
1,104,100
54,100
2023
1,157,900
1,102,300
-1,800
Labor Force
Employment
Annual Employment Change
Unemployment Rate
1,121,100
1,008,000
-53,500
10.1%4.4% 4.2% 7.3% 4.2% 4.8%
Source: California Employment Development Department
Riverside County saw declining unemployment rates in 2004-2006, increases from 2007 to 2010, declines between 2011 and 2019, a significant increase in 2020 due to the pandemic followed by improvement in 2021 and 2022. A slowing economy has contributed to rising unemployment during 2023.
The California Employment Development Department reported an unemployment rate of 5.5% in Riverside County in January 2024, up from 4.5% a year ago and compared to 5.7% for California and
4.1% for the nation.
As of January 2024, it was reported 23,700 non-farm jobs were gained in the Riverside-San Bernardino-Ontario MSA year-over-year. Annual job growth has slowed in recent quarters. The greatest job growth was in the Private Education/Health Services sector with 22,300 jobs gained, followed by the Government sector with 12,400 jobs gained. The greatest job loss was in the Trade, Transportation/Utilities sector with a loss of 10,700 jobs, followed by Leisure/Hospitality with a loss of 3,800 jobs. The following chart indicates the percentage of total employment for each sector in the metro as of January 2024.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 220
Menifee Mayor and City Council
November 6, 2024
Page
1315 of 1464
Area Analysis – Riverside County 10
The region’s largest employment sector, accounting for roughly 27% of total employment, is Trade/Transportation/Utilities, which includes wholesale and retail trade; followed by Private Education/Health Services (18%) and Government (16%).
The region’s largest employers are listed in the following table.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 221
Menifee Mayor and City Council
November 6, 2024
Page
1316 of 1464
Area Analysis – Riverside County 11
Top Employers - Riverside County
Employer
County of Riverside
Amazon
March Air Reserve Base
Nestle UA
University of California, Riverside
State of California
Walmart
Moreno Valley Unified School District
Kaiser Permanente Riverside Medical Center
Corona-Norco Unified School District
Riverside Unified School District
Mt. San Jacinto College
Marie Callender Wholesalers, Inc.
Temecula Valley Unified School District
Eisenhower Medical Center
Pechanga Resort & Casino
Hemet Unified School District
Murrieta Valley Unified School District
Starcrest of California
Palm Springs Unified School District
Stater Bros
Lake Elsinore Unified School District
Home Depot
Jurupa Unified School District
McDonalds
City of Riverside
Location Description
County Government
E-Commerce
Military Reserve Base
General Line Grocery Merchant Wholesalers
University
State Government
Retail
No. of Employees
25,366
14,317
9,600
8,874
8,623
8,383
7,494
6,020
5,817
5,478
5,431
4,638
4,454
4,022
4,001
4,000
3,960
3,552
3,450
3,328
3,297
3,267
3,115
2,749
2,721
2,700
2,631
2,581
2,231
2,228
2,214
2,200
2,120
2,053
2,035
2,008
1,991
1,936
1,928
1,678
Countywide
Countywide
March ARB
Mira Loma
Riverside
Countywide
Countywide
Moreno Valley
Riverside
Corona
Riverside
San Jacinto
Corona
Temecula
Rancho Mirage
Temecula
Hemet
Murrieta
Perris
Palm Springs
Countywide
Lake Elsinore
Countywide
Jurupa Valley
Countywide
Riverside
Countywide
Thermal
Countywide
Riverside
School District
Hospital
School District
School District
Community College District
Wholesale Trade
School District
Hospital
Resort/Casino
School District
School District
E-Commerce
School District
Retail Grocery
School District
Retail
School District
Restaurant
City Government
Retail
School District
Retail Grocery
Community College District
Hospital
Tribal Government / Casinos
Resort & Spa
School District
Retail Grocery
Medical Device Manufacturing
Hospital
Target
Coachella Valley Unified School District
Albertsons/Sav-On
Riverside Community College District
Hemet Valley Medical Center
Agua Caliente Band of Cahuilla Indians
Spa Resort & Casino
Beaumont Unified School District
Kroger (Ralphs & Vons)
Abbott Vascular, Inc.
Desert Regional Medical Center
Alvord Unified School District
Lowe's Home Improvement
United Parcel Service
Hemet
Rancho Mirage
Palm Springs
Beaumont
Countywide
Temecula
Palm Springs
Corona
Countywide
Countywide
School District
Retail
Delivery Services
Source: Riverside County Economic Development Agency, with source cited as "DatabaseUSA.com, Websites, and Public Records, 2023" Household Income
Median household income represents a broad statistical measure of well-being or standard of living in a community. The median income level divides households into two equal segments with one half of households earning less than the median and the other half earning more. The median income is considered to be a better indicator than the average household income as it is not dramatically affected by unusually high or low values. According to Claritas Spotlight data reporting service, the median household income estimated for Riverside County in 2024 is $84,882, which is lower than the state of California’s median income of $92,191.
Transportation
Access to and through Riverside County is provided by several major routes, including Interstates 10, 15 and 215, as well as State Routes 60, 62, 74, 79, 86, 91, 111 and 243. The 10 Freeway is the primary City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 222
Menifee Mayor and City Council
November 6, 2024
Page
1317 of 1464
Area Analysis – Riverside County 12
east-west connector while the 15 and 215 Freeways are the primary north-south highways. The 91 Freeway provides travel from the Inland Empire to Orange County via the 55 Freeway.
The 10 Freeway links the major southern California cities of Santa Monica, Los Angeles, Ontario, Beaumont, Palm Springs, Indio and Blythe, before intersecting with the City of Phoenix, Arizona and continuing east through New Mexico, Texas, Louisiana, Mississippi, Alabama, and terminating in Jacksonville, Florida.
As a primary north-south connector, Interstate 15 connects the counties of San Bernardino, Riverside and San Diego. The route extends north through Nevada, Arizona, Utah, Idaho and Montana to the Canadian border. Interstate 15 is a major thoroughfare for traffic between San Diego and the Inland Empire, as well as between Southern California and Las Vegas, Nevada. Interstate 215 comprises approximately 55 miles of interstate highway in the Inland Empire. The southern terminus of Interstate 215 is at the junction of Interstate 15 in Murrieta in south Riverside County and travels through Perris before joining the 60 Freeway in Moreno Valley. This interstate provides an alternative to Interstate 15 for travel between Phoenix, Las Vegas, San Bernardino and the San Diego area.
Public transportation is provided by various agencies. Riverside Transit Agency serves the western third of Riverside County, SunLine Transit Agency serves Palm Springs and the Coachella Valley area, Palo Verde Valley Transit Agency serves Blythe near the Arizona border, Pass Transit serves the San Gorgonio Pass communities, and Corona Cruiser serves the community of Corona. In addition, Riverside County is also served by Greyhound buses and Amtrak passenger trains.
The county’s main airport is the Palm Springs International Airport. This two-runway airport is located about two miles east of downtown Palm Springs and is highly seasonal, with most flights operating during the winter.
Recreation & Culture
Riverside County offers innumerable recreational and cultural opportunities, including many public parks, schools, golf courses, museums and performing arts venues. Popular attractions include the Botanical Gardens at the University of California, Riverside; the historic Mission Inn in downtown Riverside; March Field Air Museum, an aviation museum near Moreno Valley and Riverside, adjacent to the March Air Reserve Base; Temecula Valley, a tourist destination in the southern part of the county with numerous wineries, wine tasting rooms, bed and breakfast inns and wedding venues; and Castle Park, an amusement park. Annual events in the county include the Festival of Lights in Riverside, known for its display of nearly three million Christmas lights; Ghost Walk Riverside; Temecula Valley Balloon and Wine Festival; and Harvest Wine Celebration.
Riverside County is home to multiple higher education institutions including, but not limited to, the University of California Riverside, California Baptist University, California Southern Law School, California State University San Bernardino and Mt. San Jacinto College.
Conclusion
In general, Riverside County is one of the fastest growing areas in the state. New residents have been relocating here from the more expensive metropolitan areas of Los Angeles and San Diego. The region City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 223
Menifee Mayor and City Council
November 6, 2024
Page
1318 of 1464
Area Analysis – Riverside County 13
offers diverse employment opportunities, numerous colleges and universities, extensive transportation routes, shopping centers, public services and recreational activities.
In recent years, market and economic conditions were strong, with unemployment rates falling to historical lows. Employment conditions declined sharply in 2020 after the onset of the pandemic and though market and economic conditions have since improved, current macroeconomic factors, specifically high inflation and rising interest rates, have reintroduced uncertainty in the market.
Recovery in the market is expected to be gradual and the long-term outlook for the region is good.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 224
Menifee Mayor and City Council
November 6, 2024
Page
1319 of 1464
Area Analysis – Riverside County 14
Area Map
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 225
Menifee Mayor and City Council
November 6, 2024
Page
1320 of 1464
Surrounding Area Analysis 15
Surrounding Area Analysis
Introduction
This section of the report provides an analysis of the observable data that indicate patterns of growth, structure and/or change that may enhance or detract from property values. For the purpose of this analysis, a neighborhood is defined as “a group of complementary land uses; a congruous grouping of inhabitants, buildings, or business enterprises.”
Neighborhood Boundaries
The boundaries of a neighborhood identify the physical area that influences the value of the subject property. These boundaries may coincide with observable changes in prevailing land use. Physical features such as the type of development, street patterns, terrain, vegetation, and parcel size tend to identify neighborhoods. Roadways, waterways, and changing elevations can also create neighborhood boundaries.
The subject is located within the city of Menifee, Riverside County. The neighborhood boundaries can generally be described as Interstate 215 to the west, city limits of Menifee to the east, Garbani Road to the south, and McCall Boulevard to the north.
Access and Linkages
The subject is located just south of Domenigoni Parkway/Newport Road, which is a primary east and west throughfare that connects Lake Elsinore to the west and Hemet to the east. Interstate 215 is approximately two miles west of the subject (via Domenigoni Parkway/Newport Road), and extends approximately 55 miles of interstate highway in the Inland Empire. The southern terminus of Interstate 215 is at the junction of Interstate 15 in Murrieta in south Riverside County; to the north it travels through Perris before joining the 60 Freeway in Moreno Valley. State Route 74 runs east/west from San Juan Capistrano in Orange County to Palm Desert in Riverside County, stretching a total of 111 miles.
Public transportation is provided by the Riverside Transit Agency (RTA), which has a several stops along McCall and Murrieta Road to the northwest of the subject.
The county’s main airport is the Palm Springs International Airport. This two-runway airport is located about two miles east of downtown Palm Springs and is highly seasonal, with most flights operating during the winter; however, the nearest major airport to the appraised properties is Ontario International Airport (San Bernardino County), just northwest of Riverside County.
Demographics
A demographic profile of the surrounding area, including population, households, and income data, is presented in the following table.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 226
Menifee Mayor and City Council
November 6, 2024
Page
1321 of 1464
Surrounding Area Analysis 16
Surrounding Area Demographics
92584 (Menifee, Riverside County,
2024 Estimates
Population 2020
Population 2024
Population 2029
Compound % Change 2020-2024
Compound % Change 2024-2029
3-Mile Radius
48,638
52,343
57,124
1.9%
5-Mile Radius
118,513
127,603
139,135
1.9%
10-Mile Radius CA) CA
474,019
497,226
528,861
1.2%
55,643 2,418,185
2,500,920
2,623,551
0.8%
60,413
66,285
2.1%
1.8% 1.7% 1.2% 1.9% 1.0%
Households 2020
Households 2024
Households 2029
Compound % Change 2020-2024
Compound % Change 2024-2029
15,161
16,169
17,529
1.6%
39,093
41,615
44,971
1.6%
149,299
155,940
165,401
1.1%
16,864
18,183
19,836
1.9%
763,283
791,632
832,792
0.9%
1.6% 1.6% 1.2% 1.8% 1.0%
Median Household Income 2024
Average Household Size
College Graduate %
$106,759
3.2 26%
$93,912
3.1 22%
$92,810
3.2 23%
$112,051
3.3 26%
$84,882
3.1 24%
Median Age 37 39 38 36 38
Owner Occupied % 80% 78% 73% 81% 67%
Renter Occupied % 20% 22% 27% 19% 33%
Median Owner Occupied Housing Value
Median Year Structure Built
Average Travel Time to Work in Minutes
$560,712
2004
42 $528,281
2002
42 $538,879
2000
40 $577,682
2005
43 $548,183
1989
35 Source: Claritas
As shown above, the current population within a 3-mile radius of the subject is 52,343, and the average household size is 3.2. Population in the area has grown since the 2020 census, and this trend is projected to continue over the next five years. Compared to Riverside County overall, the population within a 3-mile radius is projected to grow at a faster rate.
Median household income is $106,759, which is greater than the household income for Riverside County. Residents within a 3-mile radius have a slightly higher level of educational attainment than those of Riverside County with higher median owner-occupied home values. Note the median household income and owner-occupied housing value within the zip code is greater than Riverside County.
Land Use
The subject’s immediate area consists mainly of residential development, agricultural, and vacant land. The subject is located adjacent to an egg farm that houses eggs. Most of the commercial development is located along the 215 Freeway. To the west of the subject along Newport Road at the 215 Freeway is a large retail development, which includes the Menifee Countryside Marketplace, Menifee Town Center, and Menifee Lakes Plaza. Some of the tenants within these centers include Lowes, Target, Ralphs, Aldi, Living Spaces, LA Fitness, Ross, Best Buy, Home Goods, Petsmart, Party City, and Ulta. These larger retailers are surrounded by numerous nationally-recognized in-line or pad retailers like In-N-Out Burger, Red Robin, Buffalo Wild Wings, Sonic Drive-in, Taco Bell, and Bank of America.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 227
Menifee Mayor and City Council
November 6, 2024
Page
1322 of 1464
Surrounding Area Analysis 17
Diamond Valley Lake, which is one of the largest man-made reservoirs in Southern California, is located four miles to the east of the subject. The lake features various recreational activities like trails, fishing, and boating.
The University of California, Riverside campus is located on 1,900 acres in the suburban district of Riverside, approximately 26 miles northwest of the subject. The university is consistently ranked as one of the most ethnically and economically diverse universities in the U.S. Mt. San Jacinto College (MSJC) serves a 1,700 square-mile area from the San Gorgonio Pass to Temecula. MSJC offers strong programs in nursing, administration of justice, automotive/ transportation technology, and business administration to name a few. Enrollment in the 2021-2022 school year was greater than 24,000 students. The closest hospital is the Menifee Global Medical Center approximately three miles to the northwest of the subject.
Outlook and Conclusions
The subject is located in city of Menifee, Riverside County. The neighborhood is primarily residential in nature, with commercial development in the neighborhood along the 215 Freeway. The subject benefits from good access to and from the neighborhood’s main transportation routes and easy access to major highways. The subject’s area has experienced steady development growth over the past five years.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 228
Menifee Mayor and City Council
November 6, 2024
Page
1323 of 1464
Surrounding Area Analysis 18
Surrounding Area Map
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 229
Menifee Mayor and City Council
November 6, 2024
Page
1324 of 1464
Residential Market Analysis 19
Residential Market Analysis
Given prevailing land use patterns and the subject’s zoning, a likely use of the property is for residential development. In the following paragraphs, we examine supply and demand indicators for residential development in the subject’s area.
Submarket Overview
The subject is located in the city of Menifee. The subject is adjacent to newer home construction and planned future development and is considered to have good transportation linkages. The neighborhood is characterized as a suburban area that appeals to both local workers and commuters.
Based on existing surrounding homes and new projects under development, the subject characteristics best support a project designed for a combination of entry-level and/or first-time move-up home buyers.
Single-Family Building Permits
Single-family building permits for the city of Menifee as well as Riverside County totals are shown in the following table. When we compare the trend in permitting, population and price, there can be a relationship. More supply of homes could eventually mean lower prices, whereas conversely a lower number of permits pulled could eventually mean higher prices. Further, the number of permits pulled shows builder confidence in the current market when compared to other years.
Single-Family Building Permits
Year City of Menifee
490
408
565
717
% Change
--
County of Riverside % Change
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
5,074
4,934
5,987
6,703
7,676
7,002
8,895
7,835
8,461
8,836
--
-16.73%
38.48%
26.90%
36.12%
4.20%
38.64%
-10.35%
-28.48%
-3.21%
-2.76%
21.34%
11.96%
14.52%
-8.78%
27.04%
-11.92%
7.99%
4.43%
976
1,017
1,410
1,264
904
875
Source: SOCDS Building Permits Monthly Request
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 230
Menifee Mayor and City Council
November 6, 2024
Page
1325 of 1464
Residential Market Analysis 20
Single-Family Building Permits: 2024 Preliminary Data
Month
January
February
March
April
City of Menifee County of Riverside
20 24
36 61
75 -
670
678
610
651
838
792
May
June
Total 216 4,239
Source: SOCDS Building Permits Monthly Request
Active New Home Projects Pricing and Absorption
The city of Menifee is located within the South Riverside submarket of the Inland Empire. The Ryness Report provides a comparison of sales activity between various regions and markets, including year- to-date totals from the same week of the previous year. Their surveys and reports include sales, buyer traffic, and financing rates on activity in major residential developments throughout California, Arizona, and Nevada. The report for the Inland Empire for the week ending August 25, 2024, is included as follows.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 231
Menifee Mayor and City Council
November 6, 2024
Page
1326 of 1464
Residential Market Analysis 21
The absorption within the Inland Empire has increased 2% from a year ago. The number of projects within Inland Empire varies year by year due to the extended entitlement and development timelines.
The Ryness Report has identified 42 active projects in the South Riverside submarket, with 13 of those in the the city of Menifee. These projects are summarized as follows:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 232
Menifee Mayor and City Council
November 6, 2024
Page
1327 of 1464
Residential Market Analysis 22
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 233
Menifee Mayor and City Council
November 6, 2024
Page
1328 of 1464
Residential Market Analysis 23
Projects considered most similar to the subject are further detailed in the following table.
Active Projects
Average Avg. Home Average Units
Price Size (SF) Price/SF Planned Units Sold Sales/Week Sales/Month Century Communities $547,323
Avg. Avg.
Project Name Community
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Menifee
Developer
The Village 2,220
1,931
2,189
2,485
2,197
3,090
2,279
2,975
2,071
2,796
3,441
2,393
3,052
$246.54
$327.78
$241.58
$226.42
$288.48
$249.78
$275.29
$247.52
$281.31
$221.98
$214.98
$245.71
-
126
160
177
173
157
125
109
100
96 69
145
110
138
124
120
64 1.34
1.28 1.10
1.27 1.09
1.05 0.95
0.96 1.01
0.61 0.63
0.72 0.66
5.36 5.12
4.40 5.08
4.36 4.20
3.80 3.84
4.04 2.44
2.52 2.88
2.64 Oak Shade at Shadow Mountain
Poppy at Countryview
KB Homes
KB Homes
KB Homes
Lennar
Lennar
Lennar
$632,936
$528,823
$562,657
$633,784
$771,809
$627,387
$736,385
$582,586
$620,657
$739,740
$587,990
-
Sage at Countryview
Quartz Ranch Meadow Walk
Quartz Ranch Canyon View
Rockport Ranch North Shore
Rockport Ranch South Shore
Rockport Ranch West Shore
Greenway at Cimarron Ridge
Meadows at Cimarron Ridge
Pathway at Cimarron Ridge
Legacy at Braverde
Lennar
Lennar
Pulte Homes
Pulte Homes
Pulte Homes
Richmond American
65 68
70 55
116
122
137
57 65
82 Minimum $528,823
Maximum $771,809
Average $631,006
1,931
3,441
2,548
$214.98
$327.78
$255.61
2.44 5.36
3.90 Source: Ryness Reports and Developer's Websites. *Information available was not complete for the average sale price The absorption within projects in Menifee most similar to the subject, including the three subject projects, ranged from 2.44 to 5.36 sales per month with an average of 3.90 sales per month.
Resale Pricing
The following table shows historical resale data for more recently built homes (2021 and newer) in the city of Menifee. The resale market is analyzed as a further gauge of buyer demand for housing. Often home buyers are considering housing purchase options that cover both the new home market, as well as the resale market.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 234
Menifee Mayor and City Council
November 6, 2024
Page
1329 of 1464
Residential Market Analysis 24
Resales
Living Area
(SF)
Last List
Price
Sales Days on Lot Size
(SF)Address Sale Date Sale Price
$587,687
$610,000
$755,000
$780,965
$790,044
$730,068
$752,397
$759,324
$852,518
$640,000
$542,990
$556,397
$615,000
$799,900
$605,928
$719,101
$659,990
$626,000
$610,000
$633,888
$620,000
$600,000
$689,000
$700,000
$825,000
$660,594
$725,000
$900,000
$660,000
$660,540
$778,482
$714,540
$735,000
$719,705
$800,000
$708,000
$685,000
$716,200
$578,990
$564,112
$620,000
$698,952
$724,721
$620,000
$720,342
$665,390
$642,000
$590,000
$650,000
Price/SF Sale/List Year Built Market
28358 Patches DR
28298 Hopscotch DR
32573 Mckiernan LN
30442 Freeman DR
30467 Freeman DR
30454 Freeman DR
30407 Freeman DR
30431 Freeman DR
30443 Freeman DR
27094 Nolana WAY
26932 Chance DR
26925 Chance DR
27097 Lasso WAY
24068 Timber Farm DR
26920 Chance DR
30466 Freeman DR
32630 Bullard ST
28438 Blackjack DR
28199 Schola DR
25181 Fortuna ST
26029 Redoak ST
25375 Summer creek drive
29847 Canary wood Ct
29528 Tulipwood ST
29451 Santa Ynez CIR
26908 Chance DR
32822 Forgecroft ST
29538 Holsteiner WAY
24079 Kerrigan DR
32256 Bullard ST
32652 Bullard ST
32087 Parker ST
29414 Whitewood ST
32093 Parker ST
32190 Bullard ST
31104 Alcove LN
24326 Fair Oaks CT
28384 Abbey LN
26853 Chance DR
25417 Circle Stone DR
32520 Bullard ST
32716 Dahl Jr LN
25367 Circlestone DR
32697 Jaenichen LN
32071 Parker ST
32737 Dahl Jr LN
29299 Chandler DR
30811 Cats Paw LN
32738 Dahl Jr LN
6/4/2024
6/4/2024
6/4/2024
6/4/2024
6/4/2024
6/5/2024
6/5/2024
6/5/2024
6/5/2024
6/6/2024
6/9/2024
6/9/2024
6/11/2024
6/11/2024
6/12/2024
6/14/2024
6/16/2024
6/17/2024
6/21/2024
6/21/2024
6/21/2024
6/23/2024
6/23/2024
6/23/2024
6/28/2024
7/1/2024
7/1/2024
7/1/2024
7/2/2024
7/2/2024
7/2/2024
7/3/2024
7/4/2024
7/6/2024
7/9/2024
7/10/2024
7/16/2024
7/18/2024
7/22/2024
7/24/2024
7/24/2024
7/24/2024
7/24/2024
7/30/2024
7/30/2024
7/31/2024
8/1/2024
8/2/2024
8/2/2024
2,381
2,381
2,615
3,405
3,136
3,048
2,970
3,040
2,910
2,872
1,620
2,219
1,906
2,418
1,977
2,970
1,740
2,219
1,889
2,175
2,539
1,959
3,047
2,845
2,605
2,766
2,911
3,903
2,418
2,730
2,080
2,780
3,013
3,100
3,172
2,531
2,898
3,107
1,977
1,959
2,075
3,040
3,125
2,371
3,240
2,680
2,907
2,017
2,680
$617,990
$622,368
$725,000
$732,165
$788,681
$740,068
$749,172
$758,393
$852,518
$649,999
$542,990
$547,990
$615,000
$799,900
$546,990
$729,101
$659,990
$625,000
$600,000
$628,888
$649,900
$600,000
$689,000
$700,000
$824,990
$601,990
$725,000
$850,000
$669,999
$675,540
$693,990
$724,540
$740,000
$729,705
$829,990
$698,888
$675,000
$719,900
$578,990
$564,112
$615,000
$689,866
$708,320
$650,000
$740,342
$665,390
$639,999
$599,000
$658,158
$247
$256
$289
$229
$252
$240
$253
$250
$293
$223
$335
$251
$323
$331
$306
$242
$379
$282
$323
$291
$244
$306
$226
$246
$317
$239
$249
$231
$273
$242
$374
$257
$244
$232
$252
$280
$236
$231
$293
$288
$299
$230
$232
$261
$222
$248
$221
$293
$243
95.10%
98.01%
104.14%
106.67%
100.17%
98.65%
100.43%
100.12%
100.00%
98.46%
100.00%
101.53%
100.00%
100.00%
110.77%
98.63%
100.00%
100.16%
101.67%
100.80%
95.40%
100.00%
100.00%
100.00%
100.00%
109.74%
100.00%
105.88%
98.51%
2023
2023
2022
2023
2023
2023
2023
2023
2023
2021
2023
2023
2021
2021
2023
2023
2021
2023
2021
2021
2021
2023
2022
2023
2022
2023
2022
2021
2022
2023
2021
2023
2022
2023
2023
2021
2021
2022
2023
2023
2022
2023
2023
2022
2023
2023
2021
2021
2023
151
96 50
8 114
197
226
100
6 209
67 66
26 9
11 175
94 13
18 10
115
10 9
7,540
8,000
8,712
6,020
7,432
6,020
6,717
7,385
6,923
7,893
5,071
5,569
7,292
7,684
5,011
6,453
5,990
5,507
5,663
9,148
7,841
7,453
6,000
6,717
7,841
5,053
9,056
8,276
7,200
5,100
5,665
6,000
6,050
6,000
5,587
8,215
6,970
6,395
5,150
8,304
5,227
6,050
7,076
6,098
6,000
6,500
6,647
4,965
6,500
16 55
107
19 1
5 97.78%
112.17%
98.62%
99.32%
98.63%
10 122
63 27
96 78
27 3
14 24
222
117
38 251
52 36
97 11
5 96.39%
101.30%
101.48%
99.49%
100.00%
100.00%
100.81%
101.32%
102.32%
95.38%
97.30%
100.00%
100.31%
98.50%
98.76% 110
Total Sales 49 2,620
(avg.)
$685,689
(avg.)
$682,445
(avg.)
$267
(avg.)
100.50%
(avg.)
2022
(avg.)
69 (avg.)
6,652
(avg.)
Source: Local Multiple Listing Service (MLS)
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 235
Menifee Mayor and City Council
November 6, 2024
Page
1330 of 1464
Residential Market Analysis 25
It's worth noting, the resale market remains active; though, the days on market is averaging more than two months. This is due, in large part, to the higher mortgage interest rate environment. New home communities, such as the subject, are providing in the form of incentives mortgage interest rate buy downs for qualified homebuyers, which is resulting in an appreciably higher sales volume than the resale market.
Ability to Pay
In this section, we will examine the ability to pay among prospective buyers for a representative base price point of the lowest priced and the highest priced homes within the three communities. The base price for a 1,860 square foot home in West Shore at Rockport Ranch is $559,545, while the base price for a 4,134 square foot home in South Shore at Rockport Ranch is $885,850.
First, we will estimate the required annual household income based on typical mortgage parameters in the subject’s market area. Specifically, we will employ a loan-to-value ratio of 80% (down payment of 20%), mortgage interest rate of 6.25%, 360 monthly payments, and a 40% ratio for the housing costs as a percent of monthly income (inclusive of principal, interest, all taxes and insurance). Property tax payments are accounted for in the analysis as well as homeowner’s insurance and homeowner’s association. The following table shows the estimate of the annual household income that would be required to afford homes priced at the price point.
Income Required
South Shore at West Shore at
Rockport Ranch Rockport Ranch
Home Price
Loan % of Price (Loan to Value)
Loan Amount
Interest Rate
Mortgage Payment
$885,850
80%
$708,680
6.25%
$4,363
$933
$559,545
80%
$447,636
6.25%
$2,756
$617Property Taxes Based on 1.159060% and direct charges of $923 City of Menifee CFD No. 2023-1 (Rockport Ranch)
Homeowner's Association Fee
Property Insurance
$405
$205
$185
$227
$205
$117
Total Monthly Obligation
Mortgage Payment % of Income
Monthly Income
$6,091
40%
$15,227
$182,722
$3,922
40%
$9,804
$117,652Annual Income
We have obtained income data from Claritas Spotlight by Environics Analytics, for a 10-mile radius surrounding the subject property, which is considered representative of typical buyers for the subject property. In the following table we show the income brackets within the noted area, along with estimates of the percentage of households able to afford homes priced at the representative price point within each income bracket.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 236
Menifee Mayor and City Council
November 6, 2024
Page
1331 of 1464
Residential Market Analysis 26
Household Ability
South Shore at Rockport Ranch
Percent of Percent Able to
West Shore at Rockport Ranch
Households Percent of Percent Able to Households
Households Able to PayHousehold Income
< $15,000
Households Households Pay
0.0%
0.0%
Households Able to Pay Households Pay
0.0%8,402
8,539
8,498
13,020
24,092
21,258
18,639
15,171
17,312
8,932
5.4%
5.5%
0 0
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
3.8%
5.7%
5.5%
2.2%
17.3%
5.4%
5.5%
0 0
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
3.5%
9.7%
11.1%
5.7%
5.5%
2.2%
37.8%
$15,000 - $24,999
$25,000 - $34,999
$35,000 - $49,999
$50,000 - $74,999
$75,000 - $99,999
$100,000 - $124,999
$125,000 - $149,999
$150,000 - $199,999
$200,000 - $249,999
$250,000 - $499,999
$500,000+
0.0%
5.4%
8.3%
0.0%
0.0%
0 0
5.4% 0.0% 0
8.3% 0.0% 0
15.4%
13.6%
12.0%
9.7%
0.0%
0.0%
0.0%
0.0%
0 0
0 0
15.4%
13.6%
12.0%
9.7%
11.1%
5.7%
5.5%
2.2%
100.0%
0.0%
0.0%
0 0
29.4%
100.0%
100.0%
100.0%
100.0%
100.0%
5,478
15,171
17,312
8,932
8,583
3,496
58,972
11.1%
5.7%
5.5%
2.2%
100.0%
34.6%
100.0%
100.0%
100.0%
5,982
8,932
8,583
3,496
26,993
8,583
3,496
155,942
Conclusions
Demand for homes in the subject’s market area is considered to be dynamic at the current time as indicated by the overall trend of building permit activity, new home sales prices and activity in recent quarters as well as the absorption rate within new home projects in the subject’s area.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 237
Menifee Mayor and City Council
November 6, 2024
Page
1332 of 1464
Land Description and Analysis 27
Property Analysis
Land Description and Analysis
Location and Project Details
The subject is located at the southwest corner of Old Newport Road and Briggs Road, within the city of Menifee, Riverside County, California. CFD No. 2023-1 comprises Assessor’s Parcel Numbers 364-460- 001 through -034, -037 through -052, 364-470-001 through -026, -030 through -082, 364-480-001 through -050, 364-490-001 through -072, and 364-500-001 through -054. The parcel numbers include both the appraised and assessed parcels. Note there are also common area parcels throughout the community, but they are not a part of the appraised property. Several of the homes in West and South Shore at Rockport Ranch have a waterfront premium along a man-made lake. The details of each community comprising the subject is shown in the following table.
Property Summary
No. of
Units
109
96 100
Typical Lot No. of Units
Community Builder Tax Zones
Lennar Tax Zone 2
Lennar Tax Zone 1
Lennar Tax Zone 2
Lot Size Configuration w/Water Premium
North Shore at Rockport Ranch
West Shore at Rockport Ranch
South Shore at Rockport Ranch
6,000
3,600
6,500
Traditional
8-Pack Cluster
Traditional
-
3 33
Total - City of Menifee CFD No. 2023-1 (Rockport Ranch) 305 As noted, the appraised property comprises 112 completed and sold homes, six completed (unsold) homes, 90 improved lots with homes under construction at various stages and 46 partially improved lots. In total, the appraised properties comprise 254 Assessor's Parcels; the balance of City of Menifee Community Facilities District No. 2023-1 (Rockport Ranch) is 51 completed and sold homes reflected on the County of Riverside Assessor's Tax Roll with a complete assessed value for both land and improvements.
The subject has several community amenities such as a man-made lake and pond, community swimming pool, picnic area, BBQ area, several parks and trails. All of the communities are also gated.
Shape and Dimensions
The site is irregular in shape; however, the individual single-family lots are also generally rectangular in shape. Site utility based on shape and dimensions is average.
Topography
The site is generally level and at street grade. The topography does not result in any particular development limitations.
Drainage
No particular drainage problems were observed or disclosed at the time of field inspection. This appraisal assumes that surface water collection, both on-site and in public streets adjacent to the subject, is adequate.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 238
Menifee Mayor and City Council
November 6, 2024
Page
1333 of 1464
Land Description and Analysis 28
Flood Hazard Status
The following table provides flood hazard information.
Flood Hazard Status
Community Panel Number 06065C-2070H
Date August 18, 2014
Zone A and X
Description FEMA Zone A: Special flood hazard areas subject to inundation by the 100-year flood. Because detailed hydraulic analyses have not been performed, no base flood elevations or depths are shown. Mandatory flood insurance purchase requirements apply. FEMA Zone X: Areas determined to be outside the 500-year flood plain.
Insurance Required? No
A portion of the subject property is located within FEMA Zone A; however, given the construction of the man-made lake and pond. This mitigates the risk of flood across all three communities and it is anticipated that all of the lots and homes will be located in FEMA Zone X once completed.
Seismic Hazards
All properties in California are subject to some degree of seismic risk. The Alquist-Priolo Earthquake Fault Zoning Act was enacted by the State of California in 1972 to regulate development near active earthquake faults. The Act required the State Geologist to delineate “Earthquake Fault Zones” (formerly known as “Special Studies Zones”) along known active faults in California. Cities and counties affected by the identified zones must limit certain development projects within the zones unless geologic investigations demonstrate that the sites are not threatened by surface displacement from future faulting.
According to information from the California Department of Conservation and the California Geological Survey, the subject is not located within an Alquist-Priolo Special Studies Zone. The subject is not located in a liquefaction zone.
Fire Hazard Risk
The Fire and Resource Assessment Program of CAL FIRE has classified areas of the subject’s City by Fire Hazard Severity Zone. As shown in the following map, the subject’s area has not been classified as an area of concern.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 239
Menifee Mayor and City Council
November 6, 2024
Page
1334 of 1464
Land Description and Analysis 29
Subject
Environmental Hazards
An environmental assessment report was not provided for review, and during our inspection, we did not observe any obvious signs of contamination on or near the subject. However, environmental issues are beyond our scope of expertise. It is assumed that the property is not adversely affected by environmental hazards.
Ground Stability
A soils report was not provided for our review. Based on our inspection of the subject and observation of development on nearby sites, there are no apparent ground stability problems. However, we are not experts in soils analysis. We assume that the subject’s soil bearing capacity is sufficient to support the existing improvements.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 240
Menifee Mayor and City Council
November 6, 2024
Page
1335 of 1464
Land Description and Analysis 30
Utilities
The provider of utilities to the subject is summarized in the following table.
Utilities
Service Provider
Water
Sewer
Electricity
Natural Gas
Local Phone
Eastern Municipal Water District
Eastern Municipal Water District
Southern California Edison
Southern California Gas
Various providers
Zoning
The following table summarizes the zoning for the subject.
Zoning Summary
Zoning Jurisdiction
Zoning Designation
Description
City of Menifee Planning Department
Rockport Ranch SP - MHDR and MDR
Rockport Ranch Specific Plan - Courtyard Residential and Single-Family Residential Legally Conforming?
Zoning Change Likely?
Permitted Uses
Appears to be legally conforming
No
Residential uses
According to the local planning department, there are no pending or prospective zoning changes. It appears the current use of the site is a legally conforming use. We are not experts in the interpretation of zoning ordinances. An appropriately qualified land use attorney should be engaged if a determination of compliance is required.
Other Land Use Regulations
We are not aware of any other land use regulations that would affect the property.
Easements, Encroachments and Restrictions
We have reviewed a title policy prepared by Lennar Title dated August 7, 2024. The report identifies exceptions to title, which include various utility and access easements that are typical for a property of this type. Such exceptions would not appear to have an adverse effect on value. Our valuation assumes no adverse impacts from easements, encroachments or restrictions and further assumes that the subject has clear and marketable title.
Development/Construction Status
The subject’s current development/construction status from the information provided by the developer is shown in the following table.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 241
Menifee Mayor and City Council
November 6, 2024
Page
1336 of 1464
Land Description and Analysis 31
Appraised Property Summary
Partially-
Improved SFR
Partially
Completed
Homes
35 Total
Appraised
Parcels
90 Completed Homes Sold to Assessed
Parcels
19 Community
North Shore at Rockport Ranch
Lots
20 21
5 Homes* Individuals*
2 4
0 33
39 40
South Shore at Rockport Ranch
West Shore at Rockport Ranch
22 33
86 78
14 18
TOTAL 46 90 6 112 254 51
*Completed homes without a complete assessment for structural improvements by County Assessor Of the 51 assessed parcel, three of the parcels are model homes of West Shore at Rockport Ranch and the remainder of the parcels represent completed homes held by individual homeowners within the three communities comprising the subject.
Permits and Fees
Based on information provided by the developer, permits and fees due at building permit average $75,650 per lot. This figure is generally consistent with fees at other projects in the area. Additionally, there is an estimated $16,184,260 or $53,063 per lot in bond proceeds will be used to finance impact fees. The calculation of the subject’s net permits and fees are shown in the following table.
Permits and Fees due at Building Permit
Gross Permits and Fees
Less: Bond Proceeds
Net Permits and Fees
$75,650 per unit
($53,063) per unit
$22,587 per unit
Rd. $22,600 per unit
Site Development Costs
Site development is substantially completed at the subject property. However, there are still some remaining items related to grading, street improvements, dry utilities, walls, and common areas. The remaining site development costs are estimated at $6,215,155, which will be accounted for in the Market Value by Ownership section.
Conclusion of Site Analysis
Overall, the physical characteristics of the site and the availability of utilities result in functional utility suitable for a variety of uses including those permitted by zoning. Uses permitted by zoning include residential uses. We are not aware of any other particular restrictions on development.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 242
Menifee Mayor and City Council
November 6, 2024
Page
1337 of 1464
Land Description and Analysis 32
Site Plan
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 243
Menifee Mayor and City Council
November 6, 2024
Page
1338 of 1464
Land Description and Analysis 33
Parcel Map
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 244
Menifee Mayor and City Council
November 6, 2024
Page
1339 of 1464
Land Description and Analysis 34
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 245
Menifee Mayor and City Council
November 6, 2024
Page
1340 of 1464
Land Description and Analysis 35
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 246
Menifee Mayor and City Council
November 6, 2024
Page
1341 of 1464
Land Description and Analysis 36
Aerial
Newport Road
*Source: Google Maps, Boundaries are approximate and aerial does not show the current development status of the subject.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 247
Menifee Mayor and City Council
November 6, 2024
Page
1342 of 1464
Proposed Improvements Description 37
Proposed Improvements Description
Overview
The subject property is being developed by Lennar and details of the communities are presented in the following table.
Floor Plan Summary
Living Typical Lot Developer's Base
Floor Plan Area (SF) Bedroom Bathroom Stories Garage Size (SF) Price Comments West Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
Residence Four
1,860
1,987
2,207
2,228
3 3
4 5
2.5 2.5
3.0 3.0
Two
Two
Two
Two
2-Car
2-Car
2-Car
2-Car
3,600
3,600
3,600
3,600
$559,545
$582,335
$604,945
$583,520
North Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
1,772
2,443
2,623
3 4
4 2.0
3.0 3.0
One
Two
Two
2-Car
2-Car
2-Car
6,000
6,000
6,000
$593,185
$633,065
$655,910
South Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
Residence Four
Residence Five
1,950
2,760
2,876
3,157
4,134
3 4
4 5
7 2.0
3.5 2.5
3.5 4.5
One
One
One
2-Car
2-Car
2-Car
6,500
6,500
6,500
$611,270
$700,750
$714,780
$769,140
$885,850
Two 2-Car w/storage 6,500
Two 3-Car 6,500
Next Gen Suite
Next Gen Suite
The interior finish profile is considered to be of a typical quality for the area with generally average to good overall quality. Note there are inconsistencies in the base prices; however, it is estimated there are possibly options/upgrades included in the base prices. Some of the floor plans offer a multigenerational suite, which has become very common over the past several years. The separate suite can be rented out to offset some of the mortgage or have a separate living space for another generation of the household. The Developer estimates that dues will be approximately $205 per home per month, to be paid by the future homeowners. The subject’s floor plans can be seen on the developer’s website.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 248
Menifee Mayor and City Council
November 6, 2024
Page
1343 of 1464
Proposed Improvements Description 38
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 249
Menifee Mayor and City Council
November 6, 2024
Page
1344 of 1464
Proposed Improvements Description 39
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 250
Menifee Mayor and City Council
November 6, 2024
Page
1345 of 1464
Proposed Improvements Description 40
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 251
Menifee Mayor and City Council
November 6, 2024
Page
1346 of 1464
Proposed Improvements Description 41
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 252
Menifee Mayor and City Council
November 6, 2024
Page
1347 of 1464
Real Estate Taxes 42
Real Estate Taxes
The property tax system in California was amended in 1978 by Article XIII to the State Constitution, commonly referred to as Proposition 13. It provides for a limitation on property taxes and for a procedure to establish the current taxable value of real property by reference to a base year value, which is then modified annually to reflect inflation (if any). Annual increases cannot exceed 2% per year.
The base year was set at 1975-76 or any year thereafter in which the property is substantially improved or changes ownership. When either of these two conditions occurs, the property is to be re- appraised at market value, which becomes the new base year assessed value. Proposition 13 also limits the maximum tax rate to 1% of the value of the property, exclusive of bonds and direct charges.
Bonded indebtedness approved prior to 1978, and any bonds subsequently approved by a two-thirds vote of the district in which the property is located, can be added to the 1% tax rate.
Ad Valorem Taxes
The existing ad valorem taxes are of nominal consequence in this appraisal, primarily due to the fact these taxes will be adjusted substantially as the remaining property improvements are completed and in consideration of the definition of market value employed in this appraisal, which assumes a sale of the appraised properties. According to the Riverside County Treasurer-Tax Collector’s Office, the subject has a tax rate of 1.159060% for tax year 2023-2024 (latest available), based on assessed value.
In addition, the appraised properties are subject to direct charges. Based on information provided by the special tax consultant, it is estimated the subject would have direct charges of approximately $923 per lot.
Special Assessments
All of the appraised properties are encumbered by the Special Tax Lien of City of Menifee CFD No. 2023-1 (Rockport Ranch) that also increases 2% per year. The subject communities are separated into two tax zones, which West Shore at Rockport Ranch is located within Tax Zone 1 and North and South Shore at Rockport Ranch are located within Tax Zone 2. With respect to special taxes, the annual special tax levy on the appraised properties are as follows for tax year 2024-2025:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 253
Menifee Mayor and City Council
November 6, 2024
Page
1348 of 1464
Real Estate Taxes 43
Special Tax Table (Fiscal Year 2024-2025)
Land Use Category Square Footage Category As si gned Special Tax Tax Zone 1
Single-Family Residential Property Less than 1,900 SF
Single-Family Residential Property 1,900 - 2,050 SF
Single-Family Residential Property 2,051 - 2,200 SF
Single-Family Residential Property Greater than 2,200 SF $2,647 per unit
$2,719 per unit
$2,763 per unit
$2,807 per unit
$36,276 per acre
$36,276 per acre
Multifamily Property N/A
N/ANon-Residential Property
Tax Zone 2
Single-Family Residential Property Less than 1,900 SF
Single-Family Residential Property 1,900 - 2,100 SF
Single-Family Residential Property 2,101 - 2,300 SF
Single-Family Residential Property 2,301 - 2,500 SF
Single-Family Residential Property 2,501 - 2,700 SF
Single-Family Residential Property 2,701 - 2,900 SF
Single-Family Residential Property 2,901 - 3,100 SF
Single-Family Residential Property 3,101 - 3,300 SF
Single-Family Residential Property 3,301 - 3,500 SF
Single-Family Residential Property 3,501 - 3,700 SF
Single-Family Residential Property 3,701 - 3,900 SF
Single-Family Residential Property Greater than 3,900 SF $2,798 per unit
$2,978 per unit
$3,068 per unit
$3,157 per unit
$3,260 per unit
$3,471 per unit
$3,630 per unit
$3,788 per unit
$4,057 per unit
$4,326 per unit
$4,594 per unit
$4,862 per unit
$26,112 per acre
$26,112 per acre
Multifamily Property N/A
N/ANon-Residential Property
Source: Rate and Method ofApportionment ofSpecial Taxes City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 254
Menifee Mayor and City Council
November 6, 2024
Page
1349 of 1464
Real Estate Taxes 44
Tax Zones
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 255
Menifee Mayor and City Council
November 6, 2024
Page
1350 of 1464
Highest and Best Use 45
Highest and Best Use
Process
Before a property can be valued, an opinion of highest and best use must be developed for the subject site, both as if vacant, and as improved or proposed. By definition, the highest and best use must be:
Legally permissible under the zoning regulations and other restrictions that apply to the site.
Physically possible.
Financially feasible.
Maximally productive, i.e., capable of producing the highest value from among the permissible, possible, and financially feasible uses.
Highest and Best Use As If Vacant
Legally Permissible
The site is zoned Rockport Ranch SP - MHDR and MDR, Rockport Ranch Specific Plan - Courtyard Residential and Single-Family Residential. Permitted uses are limited to residential. To our knowledge, there are no legal restrictions such as easements or deed restrictions that would effectively limit the use of the property. The subject property has an approved final map for 305 single-family homes on individual lots and associated improvements. The subject's present entitlements are the result of significant planning and review, and any rezone or land use different than currently approved is unlikely. Given prevailing land use patterns in the area, only residential use is given further consideration in determining the highest and best use of the site, as though vacant.
Physically Possible
The physical characteristics of a site that affect its possible use include, but are not limited to, location, street frontage, visibility, access, size, shape, topography, availability of utilities, offsite improvements, easements and soil and subsoil conditions. The legally permissible test has resulted in single-family residential development; at this point the physical characteristics are examined to see if they are suited for the legally permissible use.
Based on our physical inspection of the subject property, we know of no reason why the property would not support development. All utilities are available, and the property is not located within an adverse earthquake, flood, or fire zone. As noted, there is a man-made lake and pond at the project to mitigate the risk of flood across all three communities and it is anticipated that all of the lots and homes will be located in FEMA Zone X once completed. Further, the subject is proximate to new development and development appears possible. Surrounding land uses are compatible and/or similar. Development on adjacent properties provides support that soils are adequate for development. Based on the physical characteristics of the subject property, residential development is considered physically possible and most appropriate
Financially Feasible
Financial feasibility depends on supply and demand influences. With respect to financial feasibility of single-family residential development, in recent months merchant builders have acquired unimproved City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 256
Menifee Mayor and City Council
November 6, 2024
Page
1351 of 1464
Highest and Best Use 46
lots for near term construction, and there are multiple active projects in the area that demonstrate demand for new homes. Finished lots are transferring for prices that exceed the sum of unimproved lots and site development costs, which reflects completion of site development is financially feasible.
Maximally Productive
Legal, physical, and market conditions have been analyzed to evaluate the highest and best use of the appraised properties as vacant. The analysis is presented to evaluate the type of use(s) that will generate the greatest level of future benefits possible to the property. Based on the factors previously discussed, the maximally productive use of the appraised properties, and their highest and best use as vacant, is for near-term single-family residential development.
As Improved (Proposed)
As with the highest and best use as though vacant, the four tests of highest and best use must also be applied to the subject property considering the in-place improvements. Consideration must be given to the continued as-is use of the subject, as well as alternative uses for the subject. The potential alternative uses consist of demolition, expansion, conversion or renovation.
In the case of land under development, consideration must be given to whether it makes sense to demolish existing improvements (either on-site or off-site improvements) for replacement with another use. The time and expense to demolish existing improvements, re-grade, reroute utilities or re-map must be weighed against alternative uses. If the existing or proposed improvements are not performing well, then it may produce a higher return to demolish existing improvements, if any, and re-grade the site for development of an alternative use.
Based on the current condition, the improvements completed contribute to the overall property value. The value of the subject property as improved exceeds its value as vacant less demolition. The highest and best use of the subject property as improved is for continuing construction of homes, as dictated by demand.
Most Probable Buyer
In conjunction with the definition of market value, this appraisal assumes a hypothetical sale of the subject properties to a probable buyer/user, as of the date of value. The subject is considered to have good appeal for production homes. The most probable buyer would be a homebuilder for the partially-improved lots and homes under construction. The most probable buyer for the completed homes would be an individual homeowner.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 257
Menifee Mayor and City Council
November 6, 2024
Page
1352 of 1464
Valuation Methodology 47
Valuation
Valuation Methodology
Appraisers usually consider three approaches to estimating the market value of real property. These are the cost approach, sales comparison approach and the income capitalization approach.
The cost approach assumes that the informed purchaser would pay no more than the cost of producing a substitute property with the same utility. This approach is particularly applicable when the improvements being appraised are relatively new and represent the highest and best use of the land or when the property has unique or specialized improvements for which there is little or no sales data from comparable properties.
The sales comparison approach assumes that an informed purchaser would pay no more for a property than the cost of acquiring another existing property with the same utility. This approach is especially appropriate when an active market provides sufficient reliable data. The sales comparison approach is less reliable in an inactive market or when estimating the value of properties for which no directly comparable sales data is available. The sales comparison approach is often relied upon for owner-user properties.
The income capitalization approach reflects the market’s perception of a relationship between a property’s potential income and its market value. This approach converts the anticipated net income from ownership of a property into a value indication through capitalization. The primary methods are direct capitalization and discounted cash flow analysis, with one or both methods applied, as appropriate. This approach is widely used in appraising income-producing properties.
Additional analyses often undertaken in the valuation of subdivisions include extraction, land residual analysis, and the subdivision development method.
Reconciliation of the various indications into a conclusion of value is based on an evaluation of the quantity and quality of available data in each approach and the applicability of each approach to the property type.
The methodology employed in this assignment is summarized as follows:
Approaches to Value
Approach
Cost Approach
Sales Comparison Approach
Income Capitalization Approach
Applicability to Subject
Not Applicable
Applicable
Use in Assignment
Not Uti l i zed
Utilized
Not Applicable Not Uti l i zed
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 258
Menifee Mayor and City Council
November 6, 2024
Page
1353 of 1464
Market Valuation – Floor Plans 48
Market Valuation – Floor Plans
The market value of the subject’s smallest floor plans within each community with a completed home, North, South, and West Shore at Rockport Ranch, are estimated in this section. The objective of the analysis is to estimate the base price, net of incentives, upgrades and lot premiums. Incentives can take the form of direct price reductions or non-price incentives such as upgrades, interest rate buydowns, or non-recurring closing costs. The sales comparison approach to value is employed in order to provide an opinion of market value for smallest floor plan offered in the communities.
This approach is based on the economic principle of substitution. According to The Appraisal of Real Estate, 15th Edition (Chicago: Appraisal Institute, 2020), “The principle of substitution holds that the value of property tends to be set by the cost of acquiring a substitute or alternative property of similar utility and desirability within a reasonable amount of time.” The sales comparison approach is applicable when there are sufficient recent, reliable transactions to indicate value patterns or trends in the market.
The proper application of this approach requires obtaining recent sales data for comparison with the appraised properties. In order to assemble the comparable sales, we searched public records and other data sources for leads, then confirmed the raw data obtained with parties directly related to the transactions (primarily brokers, buyers and sellers). Attempts were made to obtain comparable sales from surrounding communities; however, not every attempt was returned. Further, we searched the Multiple Listing Service (MLS) for resales of comparable properties. The comparables utilized in the following analysis are from sales within the subject’s active communities and sales from surrounding communities.
For the homes with various options of the number of bedrooms or bathrooms, consistent with the “not-less-than” valuation, we will utilize the lesser of the two options. The base prices within the subject communities have increased significantly since the beginning of 2024; however, the level of incentives has also increased over this same time period. Given most homebuilders are buying down interest rates and/or offsetting closing costs, homebuilders are able to increase their base prices, while not affecting the pace of absorption or profits. The floor plans within the communities are shown in the following table.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 259
Menifee Mayor and City Council
November 6, 2024
Page
1354 of 1464
Market Valuation – Floor Plans 49
Floor Plan Summary
Living Typical Lot Developer's Base
Floor Plan Area (SF) Bedroom Bathroom Stories Garage Size (SF) Price Comments West Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
Residence Four
1,860
1,987
2,207
2,228
3 3
4 5
2.5 2.5
3.0 3.0
Two
Two
Two
Two
2-Car
2-Car
2-Car
2-Car
3,600
3,600
3,600
3,600
$559,545
$582,335
$604,945
$583,520
North Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
1,772
2,443
2,623
3 4
4 2.0
3.0 3.0
One
Two
Two
2-Car
2-Car
2-Car
6,000
6,000
6,000
$593,185
$633,065
$655,910
South Shore at Rockport Ranch
Residence One
Residence Two
Residence Three
Residence Four
Residence Five
1,950
2,760
2,876
3,157
4,134
3 4
4 5
7 2.0
3.5 2.5
3.5 4.5
One
One
One
2-Car
2-Car
2-Car
6,500
6,500
6,500
6,500
6,500
$611,270
$700,750
$714,780
$769,140
$885,850
Two 2-Car w/storage
Two 3-Car
Next Gen Suite
Next Gen Suite
The comparable sales are summarized in the following table.
Comparable Home Sale Summary
Contract
Date
8/4/2024
7/17/2024
Close of
Escrow
Living Area
(SF)
Lot Size
Year Built (SF)No. Address City
Menifee
Menifee
Sale Price
$559,990
$551,216
$498,706
$518,017
$567,075
$576,224
$554,245
$623,730
$615,675
Bedroom Bathroom Garage
1 2
3 4
5 6
7 8
9 30241 Adrift Lane
30241 Adrift Lane
29571 Grizzly Ct
Pending
Pending
Pending
Pending
Pending
7/25/2024
9/3/2024
8/2/2024
9/4/2024
1,860
1,860
1,882
1,882
1,772
1,772
1,772
1,950
2,024
3 3
3 3
3 3
3 3
3 2.5
2.5 2.5
2.5 2.0
2.0 2.0
2.0 2.0
2-Car
2-Car
2-Car
2-Car
2-Car
2-Car
2-Car
2-Car
2-Car
2024
2024
2024
2024
2024
2024
2024
2024
2024
3,305
3,305
3,000
3,000
8,892
6,024
6,686
7,062
5,901
Winchester 5/19/2024
Winchester 5/18/202429370 Novi Way
30421 Adrift Lane
30379 Adrift Lane
30475 Adrift Lane
30417 Waterline Drive
25344 Picket Range Way
Menifee
Menifee
Menifee
Menifee
Menifee
6/9/2024
5/27/2024
5/25/2024
3/23/2024
8/8/2024
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 260
Menifee Mayor and City Council
November 6, 2024
Page
1355 of 1464
Market Valuation – Floor Plans 50
Discussion of Adjustments
The sales are compared to the subject and adjusted to account for material differences that affect value. Adjustments are considered for the following factors, in the sequence shown below.
Adjustment Factor Accounts For Comments
Bond debt has a direct impact on
the amount for which the end
product will sell. In an effort to
account for the impact of bond
indebtedness on the sales price, we
establish a present value amount
for the difference in the bond
encumbrance between the subject
and comparables based on the
annual assessment, and the
Special Taxes The subject and all of the
comparables have a bond
encumbrance and are adjusted
accordingly.
estimated average holding period of
a single-family home, which is
estimated at 12 years.
The objective of the analysis is to
estimate the base value per floor
plan, net of incentives. Incentives
can take the form of direct price
reductions or non-price incentives
such as upgrades or non-recurring
closing costs.
Upgrades and
Incentives
Incentives and upgrades included in
the sales have been considered and
adjusted for in this analysis.
Real Property Rights Fee simple, leased fee, leasehold, partial interest, etc.
All the comparables represent fee
simple estate transactions.
Therefore, adjustments for property
rights are not necessary.
Financing Terms Seller financing, or assumption of
existing financing, at non-market
terms.
The comparable sales were cash to
the seller transactions and do not
require adjustments.
The comparables did not involve
any non-market or atypical
conditions of sale. Adjustments for
this factor do not apply.
Conditions of Sale Extraordinary motivation of buyer
or seller, assemblage, forced sale.
The market conditions vary over
time, but the date of this appraisal
is for a specific point in time. In a
dynamic economy – one that is
undergoing changes in the value of
the dollar, interest rates and
As demonstrated in the previous
market analysis section, new home
pricing has been fluctuating over
the past twelve months in the
subject’s market area, as well as
within the region overall.
Market Conditions
(Date of Sale, Phase
Adjustment)
economic growth or decline – extra Comparable 8 went under contract City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 261
Menifee Mayor and City Council
November 6, 2024
Page
1356 of 1464
Market Valuation – Floor Plans 51
Adjustment Factor Accounts For Comments
attention needs to be paid to assess in March of 2024 and market changing market conditions. conditions since improved.
Significant monthly changes in price Therefore, this comparable levels can occur in several areas of a warrants a slight upward neighborhood, while prices in other adjustment. All of the remaining areas remain relatively stable. comparables went under contract Although the adjustment for market within the last several months and conditions is often referred to as a
time adjustment, time is not the
cause of the adjustment.
do no warrant an adjustment for
market conditions.
Location Location is a very important factor
to consider when making
comparisons. The comparables
need not be in the same
neighborhood but should be in
neighborhoods that offer the same
The subject is located within the city
of Menifee. Comparables 9 and 10
are located in an inferior location of
Menifee and warrant an upward
adjustment. The remaining
comparables are considered to be in
advantage and have, in general, the similar locations do not warrant an same overall desirability to the
most probable buyer or user.
adjustment for location.
Community characteristics that may The subject communities have influence sale prices include a gated superior amenities compared to Community Appeal
amenity or the condition of
surrounding development.
most neighborhoods in the region.
Comparables located outside of the
subject communities are considered
to have inferior community appeal
and warrant an upward adjustment.
The lot size adjustment pertains to
the differences between the
subject’s average lot size and
comparables with either larger or
Considering the average lot size
adjustment factors indicated by the
comparable sales utilized in this
analysis, a lot size adjustment of
Lot Size
smaller lots. It does not include any $10.00 /SF is considered reasonable lot premium adjustments, which are for the subject’s residential lots. adjusted for separately. The
amount of the adjustment used in
This figure is supported by
observations of sales in the
the comparison of the base lot sizes subject’s market area. comes from a survey of premiums
paid for larger lots.
Properties sometimes achieve
premiums for corner or cul-de-sac
positioning, or proximity to open
space or views. Adjustments for lot
position premiums would be in
Appropriate adjustments are
applied based upon lot placement
and configuration within their
respective projects.
Lot Premiums/
Discounts
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 262
Menifee Mayor and City Council
November 6, 2024
Page
1357 of 1464
Market Valuation – Floor Plans 52
Adjustment Factor Accounts For Comments
addition to lot size adjustments
previously considered.
Design and appeal of a floor plan is
consumer specific. One exterior
may appeal to one buyer, while
another appeals to a different
buyer. These types of features for
new homes with similar functional
utility are not typically noted in the
base sales prices.
All of the comparables are similar to
the subject in regard to design and
appeal.
Design and Appeal
Construction quality can differ from All of the comparable sales feature slightly to substantially between similar construction quality and do projects and is noted in the exterior not require adjustments. and interior materials and design
features of a standard unit. In terms
of quality of construction, the
Quality of
Construction
subject represents good
construction quality.
When comparing resale to resale,
the market generally reflects a
difference of 1% per year of
difference in effective age.
All of the comparable sales
represent new construction; thus,
no adjustments are required.
Age/Condition
Ability to adequately provide for its The appraised properties andFunctional Utility intended purpose. comparables represent traditional
detached single-family residential as
well as cluster configurated lots and
are construction on similar lot size
categories as the subject.
Adjustments for this factor do not
apply.
For similar size units the differences Because bathrooms are a functional between room count is a buyer item for each floor plan and add preference. One buyer might prefer substantial cost due to the number Room Count
two bedrooms and a den versus a
three-bedroom unit. Extra rooms
of plumbing fixtures, an adjustment
is made for the difference in the
typically result in additional building number of fixtures between the area and are accounted for in the
size adjustment. Therefore, no
adjustments are made for number
of total rooms or bedrooms.
subject and the comparable sales.
The adjustment is based on an
amount of $7,500 per fixture (or
half-bath) and is supported by cost
estimates for an average quality
home in the Residential Cost
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 263
Menifee Mayor and City Council
November 6, 2024
Page
1358 of 1464
Market Valuation – Floor Plans 53
Adjustment Factor Accounts For Comments
Handbook, published by the
Marshall and Swift Corporation.
Considering the fact that plumbing
upgrades for existing bathrooms
generally range from $5,000 to over
$25,000 for the various fixtures, the
$7,500 per fixture, or half-bath, is
supported. Consequently, a factor
of $15,000 per full bath is also
applied in our analysis. The subject
and all of the comparables had a
similar bath count and no
adjustments were warranted.
Units similar (in the same The typical range indicated by theUnit Size/Living Area development), except for size, were paired units in this analysis compared to derive the applicable generally demonstrated a value adjustment for unit size. Those used range from approximately $50 to for comparison purposes, are units upwards of $100 per square foot. within similar projects. Units within Considering the information cited the same project were used since above, a factor of $85.00 per they have a high degree of similarity square foot is concluded to be in quality, workmanship, design and appropriate and reasonable for the appeal. Other items such as a single difference in living area between level or two-story designs, number the subject and the comparables, of bathrooms and number of garage given the quality of the product. spaces were generally similar in
these comparisons, in order to
avoid other influences in price per
square foot. Where differences
exist, they are minor and do not
impact the overall range or average
concluded.
For similar size units, the
differences between the number of story floor plans typically demand a stories is typically a buyer slight premium; as such, an preference. One buyer might prefer adjustment of 1% is applied for In current market conditions, singleNumber of Stories
a single-story versus a two-story
unit.
story differences. The subject and
all of the comparables have a
similar number of stories and do not
warrant an adjustment.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 264
Menifee Mayor and City Council
November 6, 2024
Page
1359 of 1464
Market Valuation – Floor Plans 54
Adjustment Factor Accounts For
Number of garage spaces
Comments
The subject’s floor plans offer two-
car garages. Our survey of local real
estate professionals indicates a
premium value of approximately
$15,000 for a full garage space and
approximately half, or $7,500, for
tandem garage spaces. The subject
and all of the comparables have a
similar number of parking/garage
spaces and do not warrant an
adjustment.
Parking/Garage
Included landscaping The subject and all of the
comparables include only front yard
landscaping. Therefore, no
adjustments are warranted for
landscaping.
Landscaping
Adjustment Grids
The following pages include grids reflecting the aforementioned adjustments.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 265
Menifee Mayor and City Council
November 6, 2024
Page
1360 of 1464
Market Valuation – Floor Plans 55
Residence One - West Shore at Rockport Ranch
Project Information
Project Name
Plan
Address/Lot Number
City/Area
Price
Price Per SF
Special Taxes (12-year hold at 5.5%)
Adjustment
Adjusted Price (Including Bonds)
Total Consideration per SF
Data Source
Subject Property
West Shore at Rockport Ranch
Residence One
Comparable 1
West Shore
Residence One
30241 Adrift Lane
Menifee
Comparable 2
West Shore
Residence One
30241 Adrift Lane
Menifee
Comparable 3
Opal Skye
Plan 5
29571 Grizzly Ct
Winchester
Comparable 4
Opal Skye
Plan 5
29370 Novi Way
WinchesterMenifee
N/Ap
N/Ap
$559,990
$22,813
$551,216
$22,813
$498,706
$19,165
$518,017
$19,165
$301.07 $296.35 $264.99 $275.25
$22,813
$0
$559,990
$0
$551,216
-$3,649 -$3,649
$495,057 $514,368
$301.07
Project sales agent
$296.35
Project sales agent
$263.05
Project sales agent
$273.31
Project sales agent
Incentives
Upgrades
Effective Base Sales Price
N/Ap
Base
Yes
No
($21,428) Yes
$0 Yes
$538,562
($13,196) Yes
($6,771) Yes
$531,249
($16,500) Yes
($16,206) Yes
$462,351
($15,000)
($24,517)
$474,851
Adjustments:
Property Rights
Financing Terms
Conditions of Sale
Market Conditions
Contract Date
Project Location
Community Appeal
Lot Size
Factor Description
Similar
Similar
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-)
Fee Simple
Cash Equivalent
Market Market
8/30/2024
Menifee
Average
8/4/2024
Menifee
Similar
3,305
Similar
Similar
Similar
Similar
Similar
Similar
7/17/2024
Menifee
Similar
5/19/2024
Winchester
Inferior
5/18/2024
Winchester
$30,000 Inferior
$6,000 3,000
Similar
$30,000
$6,000$10.00 3,600
N/Ap
$2,950 3,305 $2,950 3,000
Lot Premium Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Design and Appeal
Quality of Construction
Age (Total/Effective)
Condition
Functional Utility
Room Count
Average
Good
New
Good/New
Average
Similar
Similar
Similar
Similar
Similar
Bedrooms
Baths
Living Area (SF)
Number of Stories
Heating/Cooling
Garage
Landscaping
Pool/Spa
Patios/Decks
Fencing
Kitchen Equipment
Other
Gross Adjustments
Net Adjustments
Adjusted Retail Value
3 3
2.5 1,860
Two
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
3 3 3
$0 2.5
($1,870) 1,882
Two
$15,000 2.5
$85.00 1,860
Two
Central/Forced
$15,000 2-Car
Front
$0 2.5
$0 1,860
Two
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$0 2.5
$0 1,882
Two
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$0
($1,870)
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$37,870
$34,130
None
Patio
Rear
Average
None
$2,950
$2,950
$541,512
$2,950
$2,950
$534,199
$37,870
$34,130
$508,981$496,481
Concluded Retail Value
Indicated Value Per SF
$515,000
$276.88
Adjustments were necessary to account for differences between these homes and the subject’s floor plan. The sales provide a range of indicators of $496,481 to $541,512 . All of the comparables are considered to be good indicators of value as they have all the same lot configuration. As noted, the base prices for the subject’s floor plans have increased significantly since the beginning of 2024 along with the level of concessions. Therefore, we have tempered the most recent sales of the subject’s floor plans with the other comparables. We have concluded an estimate of value of $515,000 for Residence One at West Shore at Rockport Ranch.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 266
Menifee Mayor and City Council
November 6, 2024
Page
1361 of 1464
Market Valuation – Floor Plans 56
Residence One - North Shore at Rockport Ranch
Project Information
Project Name
Plan
Address/Lot Number
City/Area
Price
Price Per SF
Special Taxes (12-year hold at 5.5%)
Adjustment
Adjusted Price (Including Bonds)
Total Consideration per SF
Data Source
Subject Property
North Shore at Rockport Ranch North Shore
Residence One
Comparable 5 Comparable 6
North Shore
Residence One
30379 Adrift Lane
Menifee
Comparable 7
North Shore
Residence One
30475 Adrift Lane
Menifee
Comparable 8
South Shore
Residence One
30417 Waterline Drive
Menifee
Comparable 9
Greenway at Cimarron Ridge
Gateway
25344 Picket Range Way
Menifee
Residence One
30421 Adrift Lane
MenifeeMenifee
N/Ap
N/Ap
$567,075
$24,115
$576,224
$24,115
$554,245
$24,115
$623,730 $615,675
$320.02 $325.18 $312.78 $319.86 $304.19
$24,115 $25,666 $7,119
-$16,996
$598,679
$0
$567,075
$0
$576,224
$0
$554,245
$1,551
$625,281
$320.02
Project sales agent
$325.18
Project sales agent
$312.78
Project sales agent
$320.66
Project sales agent
$295.79
Project sales agent
Incentives
Upgrades
Effective Base Sales Price
N/Ap
Base
Yes
Yes
($21,265) Yes
($6,085) Yes
$539,725
($47,891) Yes
($22,234) Yes
$506,099
($4,390) Yes
($255) Yes
$549,600
($19,472) No
($38,740) Yes
$567,069
$0
($79,896)
$518,783
Adjustments:
Property Rights
Financing Terms
Conditions of Sale
Market Conditions
Contract Date
Project Location
Community Appeal
Lot Size
Factor Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-)
Fee Simple
Cash Equivalent
Market
8/30/2024
Menifee
Average
6/9/2024
Menifee
Similar
8,892
Similar
Similar
Similar
Similar
Similar
Similar
5/27/2024
Menifee
Similar
5/25/2024
Menifee
Similar
3/23/2024
Menifee
Similar
$11,341 8/8/2024
Menifee $10,000
$20,000
$990
Inferior
$10.00 6,000
N/Ap
($28,920) 6,024 ($240) 6,686 ($6,860) 7,062 ($10,620) 5,901 SimilarLot Premium Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Design and Appeal
Quality of Construction
Age (Total/Effective)
Condition
Functional Utility
RoomCount
Average
Good
New
Good/New
Average
Similar
Similar
Similar
Similar
Similar
Bedrooms
Baths
3 3
2.0 3 3 3 3
$0 2.0$15,000 2.0 $0 2.0 $0 2.0 $0 2.0 $0
Living Area (SF)
Number of Stories
Heating/Cooling
Garage
Landscaping
Pool/Spa
Patios/Decks
Fencing
Kitchen Equipment
Other
$85.00 1,772
One
Central/Forced
$15,000 2-Car
Front
1,772
One
$0 1,772
One
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$0 1,772
One
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$0 1,950
One
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
($15,130) 2,024
One
($21,420)
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
None
Patio
Rear
Average
None
Gross Adjustments
Net Adjustments
Adjusted Retail Value
$28,920
($28,920)
$510,805
$240
($240)
$505,859
$6,860
($6,860)
$542,740
$37,091
($14,409)
$552,661
$52,410
$9,570
$528,353
Concluded Retail Value
Indicated Value Per SF
$530,000
$299.10
Adjustments were necessary to account for differences between these homes and the subject’s floor plan. The sales provide a range of indicators of $505,859 to $552,661 . As previously stated, the subject has increased their base prices significantly along with their concessions, which has lead to some inconsistencies in the comparables. For example, Comparables 6 and 7 are the same floor plan as the subject that went under contract close to the same time and differ significantly. Therefore, to arrive an estimate of value, we gave equal emphasis to all of the comparables in the data set despite some having a larger amount of gross adjustments. We have concluded an estimate of value of $530,000 for Residence One at North Shore at Rockport Ranch.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 267
Menifee Mayor and City Council
November 6, 2024
Page
1362 of 1464
Market Valuation – Floor Plans 57
Residence One - South Shore at Rockport Ranch
Project Information
Project Name
Plan
Address/Lot Number
City/Area
Price
Price Per SF
Special Taxes (12-year hold at 5.5%)
Adjustment
Adjusted Price (Including Bonds)
Total Consideration per SF
Data Source
Subject Property
South Shore at Rockport Ranch North Shore
Residence One
Comparable 5 Comparable 6
North Shore
Residence One
30379 Adrift Lane
Menifee
Comparable 7
North Shore
Residence One
30475 Adrift Lane
Menifee
Comparable 8
South Shore
Residence One
30417 Waterline Drive
Menifee
Comparable 9
Greenway at Cimarron Ridge
Gateway
25344 Picket Range Way
Menifee
Residence One
30421 Adrift Lane
MenifeeMenifee
N/Ap
N/Ap
$567,075
$24,115
$576,224
$24,115
$554,245
$24,115
$623,730 $615,675
$320.02 $325.18 $312.78 $319.86 $304.19
$25,666 $25,666
$0
$623,730
$7,119
-$18,547
$597,128
-$1,551 -$1,551 -$1,551
$565,524 $574,673 $552,694
$319.14
Project sales agent
$324.31
Project sales agent
$311.90
Project sales agent
$319.86
Project sales agent
$295.02
Project sales agent
Incentives
Upgrades
Effective Base Sales Price
N/Ap
Base
Yes
Yes
($21,265) Yes
($6,085) Yes
$538,174
($47,891) Yes
($22,234) Yes
$504,548
($4,390) Yes
($255) Yes
$548,049
($19,472) No
($38,740) Yes
$565,518
$0
($79,896)
$517,232
Adjustments:
Property Rights
Financing Terms
Conditions of Sale
Market Conditions
Contract Date
Project Location
Community Appeal
Lot Size
Factor Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-) Description
Similar
Similar
Market
+/(-)
Fee Simple
Cash Equivalent
Market
8/30/2024
Menifee
Average
6/9/2024
Menifee
Similar
8,892
Similar
Similar
Similar
Similar
Similar
Similar
5/27/2024
Menifee
Similar
5/25/2024
Menifee
Similar
3/23/2024
Menifee
Similar
$11,310 8/8/2024
Menifee $10,000
$20,000
$5,990
Inferior
$10.00 6,500
N/Ap
($23,920) 6,024 $4,760 6,686 ($1,860) 7,062 ($5,620) 5,901 SimilarLot Premium Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Similar
Design and Appeal
Quality of Construction
Age (Total/Effective)
Condition
Functional Utility
Room Count
Average
Good
New
Good/New
Average
Similar
Similar
Similar
Similar
Similar
Bedrooms
Baths
Living Area (SF)
Number of Stories
Heating/Cooling
Garage
Landscaping
Pool/Spa
Patios/Decks
Fencing
Kitchen Equipment
Other
Gross Adjustments
Net Adjustments
Adjusted Retail Value
3 3
2.0 1,772
One
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
3 3 3 3
$0 2.0
$0 2,024
One
Similar
2-Car
$15,000 2.0
$85.00 1,950
One
Central/Forced
$15,000 2-Car
Front
$0 2.0
$15,130 1,772
One
$0 2.0
$15,130 1,772
One
$0 2.0
$15,130 1,950
One
$0
($6,290)
Similar
2-Car
Similar
2-Car
Similar
2-Car
Similar
Similar
Similar
Similar
Similar
Similar
$39,050
($8,790)
$529,384
Similar
Similar
Similar
Similar
Similar
Similar
$19,890
$19,890
$524,438
Similar
Similar
Similar
Similar
Similar
Similar
$16,990
$13,270
$561,319
Similar
Similar
Similar
Similar
Similar
Similar
$16,930
$5,690
None
Patio
Rear
Average
None
$42,280
$29,700
$546,932$571,208
Concluded Retail Value
Indicated Value Per SF
$550,000
$282.05
Adjustments were necessary to account for differences between these homes and the subject’s floor plan. The sales provide a range of indicators of $524,438 to $571,208 . Comparable 8 is considered to be the most similar comparable and given the greatest emphasis. However, again due to the inconsistencies in the data, we temper this indication with the balance of the data set. We have concluded an estimate of value of $550,000 for Residence One at South Shore at Rockport Ranch.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 268
Menifee Mayor and City Council
November 6, 2024
Page
1363 of 1464
Market Valuation – Floor Plans 58
Conclusion of Home Values
Based on the analysis herein, the market value conclusions for the homes are summarized in the following table.
Floor Plan Value Conclusions
Living Typical Lot Concluded Base
Retail ValueFloor Plan Floor Plan Area (SF) Bedroom Bathroom Stories Garage Size (SF) West Shore at Rockport Ranch Residence One 1,860
North Shore at Rockport Ranch Residence One 1,772
South Shore at Rockport Ranch Residence One 1,950
3 3
3 2.5
2.0 2.0
Two
One 2-Car
One 2-Car
2-Car 3,600
6,000
6,500
$515,000
$530,000
$550,000
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 269
Menifee Mayor and City Council
November 6, 2024
Page
1364 of 1464
Residential Lot Valuation 59
Residential Lot Valuation
For the purpose of estimating the value of the subject’s lots, we have identified the benchmark lot categories of North and West Shore at Rockport Ranch. Following the conclusion of value for the benchmark lots we will address the differences between the benchmark lot categories compared to the remaining lot categories comprising the subject property. The following table presents all of the subject lots.
Property Summary
No. of
Units
109
96 100
Typical Lot No. of Units
Community Builder Tax Zones
Lennar Tax Zone 2
Lennar Tax Zone 1
Lennar Tax Zone 2
Lot Size Configuration w/Water Premium
North Shore at Rockport Ranch
West Shore at Rockport Ranch
South Shore at Rockport Ranch
6,000
3,600
6,500
Traditional
8-Pack Cluster
Traditional
-
3 33
Total - City of Menifee CFD No. 2023-1 (Rockport Ranch) 305 We will utilize the sales comparison approach and a land residual analysis to estimate the market value of a finished lot. For purposes of this analysis, two benchmark lot categories will be utilized:
North Shore (6,000 square feet) and West Shore (3,600 square feet). The estimate of value assumes the lots would sell on a bulk, or wholesale, basis. That is, a group of lots would transfer in one transaction to a single buyer.
Later in this report, we apply a lot size adjustment factor to account for differing lot sizes within the subject. Remaining development costs applicable to the subject property are accounted for in the Market Value by Ownership section.
Sales Comparison Approach
In this section of the report, we will utilize the sales comparison approach to estimate the market value of the subject lots. This value estimate assumes the subject property would sell on a bulk, or wholesale, basis. That is, it would transfer in one transaction to a single buyer. This approach develops an indication of value by researching, verifying, and analyzing sales of similar properties. Our sales research focused on transactions within the following parameters:
Location: Menifee and surrounding areas
Typical Lot Size: 2,000 to 8,000 square feet
Number of Lots: 40 to 250 lots
Transaction Date: 2021 or later
The bulk lot sales are analyzed on a loaded lot basis. Loaded lot is the equivalent of underlying land, any remaining site development costs and all fees paid through the building permit for home construction. The most relevant sales are summarized in the following table:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 270
Menifee Mayor and City Council
November 6, 2024
Page
1365 of 1464
Residential Lot Valuation 60
Summary of Comparable Land Sales - North Shore at Rockport Ranch Sale Date;
Status
Jan-24
Sale Price; Bond
Consideration/Lot
$21,000,000
$4,000
Typical Lot
Size
7,200
Expenditures After
PurchaseNo. Name/Address Number of Lots $/Lot
182 $115,385 $141,2091 ES Leon Rd., SO Domenigoni Pkwy.
Winchester In-Contract
Riverside County
Comments: This is the pending sale of 182 final mapped lots on 84.8 total acres. The lots will be delivered in blue-top condition. Additional estimated costs for a finished lot total $141,209 per lot. A bond district had not yet been created for the property but was anticipated for the project. Given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.
2 Stratford Place II - East
Evans Rd.
Oct-23
Closed
$13,186,466
$6,000
6,000 107 $123,238 $104,762
Perris
Riverside County
Comments: This is a sale 107 unimproved lots with a typical lot size of 6,000 square feet. The finished lot price is estimated at $225,000 per lot. A building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $3,000 per lot. 3 4
Green Valley Ranch PA 12
Green Valley Pky.
Perris
Sep-23
Closed
$11,795,535
$4,000
6,500 191 $61,757 $141,243
Riverside County
Comments: This is a sale of 191 unimproved lots with a typical lot size of 6,500 square feet. The finished lot price is estimated at $200,000 per lot. A building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.
Stratford Place II
Evans Rd.
Nov-22
Closed
$4,906,500
$5,966
6,000 90 $54,517 $175,483
Perris
Riverside County
Comments: This is a sale of 90 unimproved lots with a tentative map in place and a typical lot size of 6,000 square feet. The lots were purchased for $4,906,500 or $54,517. According to the broker, the lots were purchased at a finished lot price of $230,000 per lot. The buyer is developing the 270 lots adjacent to the north of this project. It is assumed there was a degree of assemblage influencing a part of the sale, but this was not confirmed. It is estimated this project will have a similar degree of bond debt as the adjacent project, which has an estimated $2,983 per lot. 5 Windsong
NWQ Alessandro Blvd. and Darwin Dr.
Moreno Valley
Aug-22
Closed
$7,500,000
$4,000
5,000 177 $42,373 $197,345
Riverside County
Comments: This sale encompasses two adjacent parcels purchased by D.R. Horton from two different sellers. D.R. Horton closed on the first 18.01-acre parcel for $3,755,000 on August 1, 2022 and closed on the second 17.63-acre parcel for $3,745,000 on August 2, 2022. The site will be developed into a 177-lot subdivision called Windsong. Floor plans will range from 1,898 to 2,537 square feet and the typical lot size will be approximately 5,000 square feet. Finishing costs are estimated at approximately $197,345 per lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot. 6 7
La Ventana
SEC Simpson Rd and La Ventana Rd
Winchester
Apr-22
Closed
$8,000,000
$4,000
6,000 220 $36,364 $178,636
Riverside County
Comments: Site consists of 220 residential lots, along with a park site and a school site. The typical lot size is approximately 6,000 SF. The finished lot price was reportedly $215,000/lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.
Pleasant Valley Ranch
Linden Flower Rd.
Winchester
Aug-21
Closed
$15,728,000
$5,376
7,250 202 $77,861 $150,861
Riverside County
Comments: This is a sale of 202 paper lots with a typical lot size of 7,250 square feet for $77,861 per lot. The lots included the sale of five partially completed models that were constructed prior to the Great Recession in 2007. The backstory to the project was not given; however, it appears one of the previous owners of the project tried to develop the property and later abandon it. The prior models on the property were demolished by DR Horton and the site development to improve the lots was estimated at $15,400,862 or $76,242 per lot. Permits and fees are estimated at $73,000 per lot, while special taxes are estimated at $2,688 per lot.
Subject - North Shore at Rockport Ranch
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Menifee, CA
6,000 109
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 271
Menifee Mayor and City Council
November 6, 2024
Page
1366 of 1464
Residential Lot Valuation 61
Summary of Comparable Land Sales - West Shore at Rockport Ranch Sale Date;
Status
Dec-23
Closed
Sale Price; Bond
Consideration/Lot Size
$22,077,500
$4,000
Typical Lot Expenditures
After Purchase
$111,503 $118,735
No. Name/Address Number of Lots $/Lot
1981 Riverwalk Village
Bradley Rd.
2,500
Menifee
Riverside County
Comments: This is a sale of 198 lots in unimproved condition. The lots are configured in an 8-pack courtyard cluster and have several community amenities. Based on the density of the project, the typical lot size is estimated at 2,250 square feet. The finished lot is estimated at $225,338 per lot. A building permit is estimated at $4,900 per lot. The project is utilizing special taxes; however, the exact annual payment is unclear. Therefore, based on the surrounding projects an annual special tax is estimated at $2,000 per lot. 2 Alessandro Nov-23
Closed
$16,143,500
$4,000
3,600 225 $71,749 $131,516
Alessandro Blvd.
Moreno Valley
Riverside County
Comments: This is a sale of 225 tentatively mapped lots with a typical lot size of 3,000 square feet. The lots will be developed into clusters; however, it is unclear the exact layout. The finished lot price is estimated at $201,265 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot. 3 4
27550 Brodiaea Avenue
27550 Brodiaea Ave.
Moreno Valley
Jul-23
Closed
$2,800,055
$4,000
3,000 67 $41,792 $137,877
Riverside County
Comments: This is a sale of 67 tentatively mapped lots with a typical lot size of 3,600 square feet. The finished lot price is estimated at $177,669 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.
Towns & Courts
Domenigoni Pky.
Winchester
Apr-22
Closed
$17,500,000
$4,000
3,000 252 $69,444 $82,556
Riverside County
Comments: This is a sale of 252 lots in bluetop condition. The project will be developed as 124 townhomes and 128 cluster lot homes. Based on the density of the project, the typical lot size is estimated at 2,500 square feet. The finished lot is estimated at $150,000 per lot. A building permit is estimated at $2,000 per lot. The project is utilizing special taxes; however, the exact annual payment is unclear.
Therefore, based on the surrounding projects an annual special tax is estimated at $2,000 per lot. 5 SWC Leon Rd & Simpson Rd
Winchester
Feb-22
Closed
$8,000,000
$4,000
2,250 420 $19,048 $132,952
Riverside County
Comments: Property sold with a recorded final map for 420 single family lots. The site also includes two future parks. The estimated lot size is 3,000 square feet. The brokers estimates a finished lot value of $150,000 per lot. A building permit within the unincorporated area of Winchester is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.
Subject - West Shore at Rockport Ranch
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Menifee, CA
3,600 96
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 272
Menifee Mayor and City Council
November 6, 2024
Page
1367 of 1464
Residential Lot Valuation 62
Comparable Land Sales Map – North Shore at Rockport Ranch City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 273
Menifee Mayor and City Council
November 6, 2024
Page
1368 of 1464
Residential Lot Valuation 63
Comparable Land Sales Map – West Shore at Rockport Ranch City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 274
Menifee Mayor and City Council
November 6, 2024
Page
1369 of 1464
Residential Lot Valuation 64
Loaded Lot Analysis
Prior to the application of adjustments, the following items are added to the per lot sale price.
Loaded Lot Analysis
Remaining Site Dev. Cost We apply adjustments for remaining site development costs (if any).
Permits and Fees Permits and fees due upon building permit are included on a dollar-for- dollar basis.
Bond Encumbrance If applicable, we consider the annual special tax and typical holding time for a developer (2 years) for each comparable (if bond debt exists).
Adjustment Factors
The sales are compared to the subject and adjusted to account for material differences that affect value. Adjustments are considered for the following factors, in the sequence shown below.
Adjustment Factor Accounts For Comments
Real Property Rights Fee simple, leased fee, leasehold, partial interest, etc.
All the comparables represent fee
simple estate transactions.
Therefore, adjustments for property
rights are not necessary.
Financing Terms Seller financing, or assumption of
existing financing, at non-market
terms.
All of the comparables are all cash
or cash to seller transactions and do
not warrant an adjustment.
For North Shore at Rockport Ranch,
Comparables 2 and 4 were
influenced by the buyer’s desire to
assemble lots proximate to
Conditions of Sale Extraordinary motivation of buyer
or seller, assemblage, forced sale.
properties they developed to the
north; therefore, these comparables
warrant a downward adjustment.
All of the remaining comparables
are market transactions and do not
warrant an adjustment for
conditions of sale.
Market Conditions Changes in the economic
environment over time that affect
the appreciation and depreciation
of real estate.
Home values increased significantly
leading up to the first quarter of
2022, when mortgage interest rates
began a steady increase from
historical lows (below 3%) to over
7%. While some price appreciation
was offset by rising construction
costs (materials) and labor
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 275
Menifee Mayor and City Council
November 6, 2024
Page
1370 of 1464
Residential Lot Valuation 65
Adjustment Factor Accounts For Comments
shortages during the pandemic,
construction costs have since
moderated. As the inventory of
available new homes continues to
deplete, and demand remains
strong, despite the higher interest
rates, home prices appear to be
stabilizing. Market participants have
noted that current market values
are similar to late First Quarter
2022, which represented the top of
the market with land values
subsequently declining due to the
rising interest rates and other
economic conditions. This appears
to have been short-lived, as recent
market interviews suggest merchant
builders are once again actively in
the market for developable lots to
satisfy increased homebuyer
demand. Comparables that
transferred in 2023 and prior
warrant an upward adjustment.
Several sales were negotiated prior
to the dates of sale. The contract
dates of each sale were accounted
for in this analysis.
Location/Community Market or submarket area The subject is located in the city of Menifee. Comparables located in
Perris are considered to be inferior
to the subject and warrant an
upward adjustment.
Appeal influences on sale price;
surrounding land use influences.
Number of Lots Generally, there is an inverse Typically, variances in per lot prices, relationship between the number of all else being equal, are not lots and price per lot such that
larger projects (with a greater
number of lots) achieve a lower
price per lot.
observed in transactions between
40 and 250 lots. For West Shore at
Rockport Ranch, Comparable 5
transacted with a greater number of
lots than a typical transaction and
warrants an upward adjustment. No
further adjustments for the number
of lots is required.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 276
Menifee Mayor and City Council
November 6, 2024
Page
1371 of 1464
Residential Lot Valuation 66
Adjustment Factor Accounts For Comments
Lot Size Adjustments for differences in lot
size between the comparables and
subject are considered.
Those comparables with discernably
larger lot sizes relative to the
subject’s typical lot size of 6,000
and 3,600 square feet for North
Shore and West Shore at Rockport
Ranch, respectively, are adjusted
downward. Conversely,
comparables with smaller lot sizes
are adjusted upward.
Site Utility Differences in contour, drainage,
soil conditions, as well as project
design, can affect the utility and
therefore, the market value of the
properties.
The subject property is considered
to have average utility. For West
Shore at Rockport Ranch, the lots
are configured in an 8-pack cluster
formation. Comparable 3 has a
traditional configuration, which is
considered to be superior and
warrants a downward adjustment.
Conversely, a portion of
Comparable 4 lots have a
townhome configuration, which is
considered to be inferior to a cluster
configuration and warrants an
upward adjustment. Each of the
remaining comparables are
considered to offer similar site
utility as the subject and no
additional adjustment for this
characteristic are required.
Lot Premiums/
Discounts
Primary physical factors that affect
desirability of lots.
The subject has average lot
premiums/discounts. All of the
comparables have similar lot
premiums/discounts and no
adjustments are warranted.
The tables on the following pages summarizes the required adjustments when considering the comparable sales relative to the subject.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 277
Menifee Mayor and City Council
November 6, 2024
Page
1372 of 1464
Residential Lot Valuation 67
Land Sales Adjustment Grid - North Shore at Rockport Ranch Subject Comparable 1
ES Leon Rd., SO
Domenigoni Pkwy. East
Comparable 2
Stratford Place II - Green Valley
Comparable 3 Comparable 4
Stratford Place II Windsong
Comparable 5 Comparable 6
La Ventana
Comparable 7
Pleasant Vall ey
Ranch
Name City of Menifee
CFD No. 2023-1
(Rockport Ranch)
Menifee
Ranch PA 12
City
County
Sale Date
Sale Status
Winchester
Riverside
Jan-24
In-Contract
$21,000,000
182
Perris
Riverside
Oct-23
Closed
$13,186,466
107
Perris Perris Moreno Valley Winchester
Riverside
Apr-22
Closed
$8,000,000
220
Winchester
Riverside
Aug-21
Closed
$15,728,000
202
Riverside Riverside
Sep-23
Closed
$11,795,535
191
Riverside
Nov-22
Closed
$4,906,500
90 Riverside
Aug-22
Closed
$7,500,000
177
Sale Price
Number of Lots
Price per Lot
109
$115,385
$141,209
$4,000
$260,594
Fee Simple
–
$123,238
$104,762
$6,000
$234,000
Fee Simple
–
$61,757
$141,243
$4,000
$207,000
Fee Simple
–
$54,517
$175,483
$5,966
$235,966
Fee Simple
–
$42,373
$197,345
$4,000
$243,718
Fee Simple
–
$36,364
$178,636
$4,000
$219,000
Fee Simple
–
$77,861
$150,861
$5,376
$234,098
Fee Simple
–
Expenditures After Purchase
Bond Consideration
Price per Lot (Loaded)
Property Rights
Ranking
Financing Terms
Adjustment
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Conditions of Sale
Adjustment
Market Conditions
Adjustment
Market
–
Jan-24
Assemblge
Superior
Oct-23
Market
–
Sep-23
Inferior
Assemblge
Superior
Nov-22
Inferior
Market
–
Aug-22
Inferior
Market
–
Apr-22
Market
–
Aug-218/30/2024
– Inferior Inferior Very Inferior
Property Adjustments
Location/Community
Adjustment
Number of Lots
Adjustment
Menifee
109
Winchester
–
182
–
Perris
Inferior
107
Perris
Inferior
191
–
Perris
Inferior
90 Moreno Valley
–
177
–
Winchester
–
220
–
Winchester
–
202
–– –
Typical Lot Size
Adjustment
Site Uti li ty
Adjustment
Lot Premiums/Discounts
Adjustment
6,000 7,200
Superior
Average
–
Average
–
6,000
–
Average
–
Average
–
6,500
–
Average
–
Average
–
6,000
–
Average
–
Average
–
5,000
Inferior
Average
–
Average
–
6,000
–
Average
–
Average
–
7,250
Superior
Average
–
Average
–
Average
Average
Overall Ranking Superior Inferior Very Inferior Inferior Inferior Inferior Inferior City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 278
Menifee Mayor and City Council
November 6, 2024
Page
1373 of 1464
Residential Lot Valuation 68
Land Sales Adjustment Grid - West Shore at Rockport Ranch Subject Comparable 1
Riverwalk Village Alessandro
Comparable 2 Comparable 3
27550 Brodiaea
Avenue
Comparable 4
Towns & Courts
Comparable 5
SWC Leon Rd &
Simpson Rd
Name City of Menifee
CFD No. 2023-1
(Rockport Ranch)
MenifeeCity
County
Menifee
Riverside
Dec-23
Closed
$22,077,500
198
Moreno Valley
Riverside
Nov-23
Closed
$16,143,500
225
Moreno Valley
Riverside
Jul-23
Closed
$2,800,055
67 Winchester
Riverside
Apr-22
Closed
$17,500,000
252
Winchester
Riverside
Feb-22
Closed
$8,000,000
420
Riverside
Sale Date
Sale Status
Sale Price
Number of Lots
Price per Lot
96 $111,503
$118,735
$4,000
$234,238
Fee Simple
–
$71,749
$131,516
$4,000
$207,265
Fee Simple
–
$41,792
$137,877
$4,000
$183,669
Fee Simple
–
$69,444
$82,556
$4,000
$156,000
Fee Simple
–
$19,048
$132,952
$4,000
$156,000
Fee Simple
–
Expenditures After Purchase
Bond Consideration
Price per Lot (Loaded)
Property Rights
Adjustment
Financing Terms
Adjustment
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Cash to seller
–
Conditions of Sale
Adjustment
Market
–
Market
–
Market
–
Market
–
Market
–
Market Conditions
Adjustment
8/30/2024 Dec-23
–
Nov-23
Inferior
Jul-23
Inferior
Apr-22
Inferior
Feb-22
Inferior
Property Adjustments
Location/Community
Adjustment
Number of Lots
Adjustment
Typical Lot Size
Adjustment
Site Uti li ty
Menifee
96 Menifee
–
198
Moreno Valley
–
225
–
3,000
Inferior
Similar
–
Similar
–
Moreno Valley
–
67 –
3,600
–
Above Average
Superior
Similar
–
Winchester
–
252
–
Winchester
–
420
Inferior
3,000
Inferior
Similar
–
–
3,600 2,250
Inferior
Similar
–
Similar
–
2,500
Inferior
Below Average
Inferior
Similar
–
Average
Average
Adjustment
Lot Premiums/Discounts
Adjustment
Similar
–
Overall Ranking Inferior Inferior Inferior Very Inferior Very Inferior City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 279
Menifee Mayor and City Council
November 6, 2024
Page
1374 of 1464
Residential Lot Valuation 69
Land Value Conclusion
For North Shore at Rockport Ranch, the comparables reflect a range of sales prices of $36,364 to $123,238 per lot where as for West Shore at Rockport Ranch, the comparables reflect a range of sales prices of $19,048 to $111,503 per lot. The wide disparity in the unadjusted range is largely attributable to lot condition at time of sale (unimproved lots, partially improved lots and improved lots), as well as differences in permits and fees, remaining site costs and bonds encumbrances. After accounting for the expenditures after sale, the comparables exhibit a loaded lot range of $207,000 to $260,594 per loaded lot for North Shore at Rockport Ranch. For West Shore at Rockport Ranch, the comparables exhibit a loaded lot range of $156,000 to $234,238 per loaded lot. The following table summarizes the loaded lot values (unadjusted) and our conclusion of loaded lot value for the subject property.
Bulk Lot Ranking Summary - North Shore at Rockport Ranch $/ Loaded Lot
Comparable Sale Date
Jan-24
-
Aug-22
Nov-22
Aug-21
Oct-23
Apr-22
Sep-23
(Unadjusted)
$260,594
$250,000
$243,718
$235,966
$234,098
$234,000
$219,000
$207,000
Net Adjustment
Superior
-
Inferior
Inferior
Inferior
Inferior
Inferior
Very Inferior
1 Subject
5 4
7 2
6 3
Estimated Unit Value $250,000
Ranking Analysis and Reconciliation - West Shore at Rockport Ranch $/ Loaded Lot
Comparable Sale Date
Dec-23
-
Nov-23
Jul-23
Apr-22
Feb-22
(Unadjusted)
$234,238
$215,000
$207,265
$183,669
$156,000
$156,000
Net Adjustment
Inferior1
Subject -
2 3
4 5
Inferior
Inferior
Very Inferior
Very Inferior
Estimated Unit Value $215,000
For North Shore at Rockport Ranch, primary reliance is placed on Comparable 1 as it received the least amount of gross adjustments and is the most recent sale in the data set. The remaining comparables are given secondary reliance. For West Shore at Rockport Ranch, Comparable 1 is an outlier in the data and is given secondary reliance despite receiving the least amount of gross adjustments. The remaining comparables are considered to be inferior to the subject, so an estimate of value between Comparable 1 and the remaining comparables is considered to be reasonable.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 280
Menifee Mayor and City Council
November 6, 2024
Page
1375 of 1464
Residential Lot Valuation 70
Deducting the subject’s net permits and fees due at building permit, which is reflective of the impact fees to be financed by the proposed Bonds, yields a finished lot value for the subject property as calculated below for each benchmark lot category.
Conclusion of Value: Sales Comparison Approach
North Shore at
Rockport Ranch
$250,000
($22,600)
$227,400
West Shore at
Rockport Ranch
$215,000
($22,600)
$192,400
Lot Size Categories
Concluded Loaded Lot Value
Less: Permits & Fees
Estimated Finished Lot Value
Rounded $227,000 $192,000
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 281
Menifee Mayor and City Council
November 6, 2024
Page
1376 of 1464
Land Residual Analysis 71
Land Residual Analysis
The land residual analysis is employed as an additional indicator of market value for the subject’s lots.
This valuation method is used in estimating land value when subdivision and development are the highest and best use of the land being appraised. All direct and indirect costs are deducted from an estimate of the anticipated gross sales price of the improved product; the resultant net sales proceeds are then discounted to present value at an anticipated rate over the development and absorption period to indicate the value of the land. The land residual analysis is conducted on a quarterly basis. As a discounted cash flow analysis, the land residual analysis consists of four primary components summarized as follows:
Revenue – the gross income is based on the sale of completed homes.
Absorption Analysis – the time frame required for sell off. Of primary importance in this analysis is the allocation of the revenue over the absorption period – including the estimation of an appreciation factor (if any).
Expenses – the expenses associated with the sell-off are calculated in this section – including direct and indirect construction costs, administration, marketing, and commission costs, as well as taxes and special taxes (if any).
Discount Rate – an appropriate discount rate is derived employing a variety of data.
Discussions of these four concepts follows below, with the discounted cash flow analysis offered at the end of this section.
Revenue
The projected sales price for the average unit within the project will vary, as the ultimate sales price is affected by unit size, location within the project, site influences, construction costs, anticipated premiums achievable at the point of retail sale, as well as external influences such as adjacent land uses.
The benchmark lot categories are North and West Shore at Rockport Ranch, which consists of 109 and 96 lots, respectively, with a typical lot size of 6,000 and 3,600 square feet, respectively. Based on the Residential Market section of this report and considering current asking prices, we estimated a typical home size and corresponding base price for each benchmark lot category. For North and West Shore at Rockport Ranch, we estimate a typical average-sized home on the subject would contain approximately 2,400 and 2,000 square feet, respectively, and would have a corresponding base price of $600,000 and $530,000, respectively. These estimates will be utilized in the analysis.
Closing Projections
The typical time required for the construction of units has been approximately three to six months from start to closing. It is assumed that initial closings will occur within three to six months of the date of sale. The premise is that the builder constructs efficiently as homes are sold. These assumptions are reflected in the projected construction schedule shown in the land residual models at the end of this section. Since the land residual analysis is conducted on a quarterly basis, closings are reflected in the following period, as most construction will be substantially completed prior to initiation of sales.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 282
Menifee Mayor and City Council
November 6, 2024
Page
1377 of 1464
Land Residual Analysis 72
Changes in Market Conditions (Price Increases or Decreases) The subject’s market area has experienced rapid market appreciation in home prices for the past few years; however, since early 2022 the Federal Reserve Bank began raising the benchmark federal-funds rate (from near zero in March 2022) in an effort to manage rising inflation. The fed-funds rate is greater than 5%, which has resulted in a substantial rise in mortgage interest rates, which now are approximately 6.25% and have moderated from 8.0% in October of 2023. The rise in mortgage interest rates has impacted the affordability of homes for a certain segment of the homebuyer market, which may impact pricing in the near term. Consequently, under current market conditions, forecasting home appreciation during the absorption period is speculative, and several homebuilders surveyed indicate they typically do not trend/forecast home appreciation during the sell-off period. Therefore, for purposes of this analysis, the home price revenue will be held constant during the sell-off period.
Absorption
Typically, multiple product lines would be marketed in a subdivision to create characteristics appealing to as many potential purchasers as possible. Offering home products within a subdivision to different market segments is done with the aim of increasing absorption and reducing the overall development holding period for a project.
Based on the typical marketing and absorption rate data presented in the Residential Market overview, we estimate an absorption rate of approximately 3.5 and 4 units per month or 10.50 and 12 units per quarter for North and West Shore at Rockport Ranch, respectively. For North Shore at Rockport Ranch, home sales begin in Period 1 and the subject lots sell out in Period 11, with Period 12 needed to complete construction and close escrow. For West Shore at Rockport Ranch, home sales begin in Period 1 and the subject lots sell out in Period 8, with Period 9 needed to complete construction and close escrow. Our disposition period is over the course of 3.0 and 2.25 years for North and West Shore at Rockport Ranch, respectively. Market conditions are anticipated to remain stable over this time.
Expense Projections
As part of an ongoing effort to assemble market information, the table below reflects survey responses and developer budget information for numerous single-family residential subdivisions throughout the Southern California region.
Subdivision Budgets
Developer
Classification Municipality
Budget No. of Avg. Home Typical Lot G & A % of Mkt & Sales % Direct Indirect Indirect % of Site Permits & Cost per Profit % of Projected Sales/Mo.
4 Date Units Quality Size (SF)
1,820
2,135
2,707
2,900
2,246
1,975
2,342
2,220
2,112
2,092
2,346
2,420
2,009
2,187
1,834
1,948
1,834
2,253
2,289
Size Revenue
2.7%
N/Av
N/Av
3.5%
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
3.0%
4.4%
N/Av
N/Av
N/Av
N/Av
N/Av
of Revenue Costs/SF Costs/SF Direct Costs Costs/Lot Fees/Unit Model N/Av
N/Av
Revenue
19.20% N/Av
N/Av
N/Av
IRR
National
National
National
Local
Winchester
San Jacinto
Winchester
Jurupa Valley
San Diego County
San Diego County
Winchester
Victorville
San Jacinto
2024 276 Average 3,000
7,200
6,200
6,750
N/Av
N/Av
7,250
7,200
7,200
5,500
7,350
6,698
2,565
8,005
9,148
7,817
5,500
7,000
6,600
2.7%
N/Av
N/Av
3.0%
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
3.5%
5.7%
N/Av
N/Av
N/Av
N/Av
N/Av
$93.38 N/Av
$88.55 N/Av
$83.18 N/Av
$85.53 $16.67
$152.00 N/Av
$135.00 N/Av
$72.06 $11.06
$74.96 $11.09
$77.91 $9.73
$92.11 N/Av
$79.46 N/Av
$95.00 N/Av
$87.42 $16.63
$72.68 $6.35
$80.00 N/Av
$87.02 N/Av
$60.00 N/Av
$57.21 N/Av
$66.49 N/Av
N/Av
N/Av
N/Av
19.49%
N/Av
N/Av
15.35%
14.79%
12.49%
N/Av
N/Av
N/Av
19.0%
9%
N/Av
$76,390 $66,100
$139,940 $54,600 $37,814
$125,482 $64,861
$240,018 $50,668
$240,018 $47,937
$76,242 $73,000
$83,185 $32,800 $80,339
$110,669 $61,700
$72,875 $51,700
$48,101
2024 89 Average N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
3.96 2024 129 Average
2023
2023
2023
53 Average
27 83
N/Av
N/Av
N/Av
N/Av
12.0% 25.0%
National
Regional
National
National
National
National
National
National
Regional
Regional
Local
Good
Good
N/Av
N/Av
N/Av
N/Av
N/Av
20.5%
N/Av
N/Av
14.0%
9.6%
N/Av
N/Av
8.0%
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
17.0%
N/Av
N/Av
30.2%
N/Av
N/Av
N/Av
N/Av
N/Av
2023 202 Average
2023 276 Average
2023 177 Average
2022 150 Average
N/Av
N/AvHemet
Moreno Valley
San Diego County
Riverside County
Lancaster
Desert Hot Springs
Bakersfield
Riverside County
Los Angeles County
Riverside County
2022 96 Average $124,544 $68,647 $164,265
$255,045 $77,870
N/Av $54,371
2022 187 Average
2021 128 Average
N/Av
N/Av
2021
2020
2020
99 Average
27 Average
70 Average
$89,461 $35,931 $54,000
16%
12%
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
$39,000 $40,000
N/Av $31,200
$24,627
$38,080
$62,500
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
N/Av
4/5
N/Av
N/Av
National
Regional
National
Regional
2020 145 Average
2020 148 Average
2020 46 Average
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 283
Menifee Mayor and City Council
November 6, 2024
Page
1378 of 1464
Land Residual Analysis 73
Information from the survey above will contribute to the estimate of development expenses classified as follows.
General and Administrative
These expenses consist of management fees, liability and fire insurance, inspection fees, appraisal fees, legal and accounting fees and copying or publication costs. This expense category typically ranges from 2.5% to 4.0%, depending on length of project and if all of the categories are included in a builder’s budget. We have used 3.0% for general and administrative expenses.
Marketing and Sale
These expenses typically consist of advertising and promotion, closing costs, sales operations, and sales commissions. The expenses are expressed as a percentage of the gross sales revenue. The range of marketing and sales expenses typically found in projects within the subject’s market area is 5.0% to
6.5%. A figure of 6.0%, or 3.0% for marketing and 3.0% for sales, is estimated in the marketing and sales expense category.
Property Taxes (Ad Valorem and Special Taxes)
The subject is located within an area with an effective tax rate of 1.1591%. This amount is applied to the estimated market values and divided by the total number of units to yield an estimate of ad valorem taxes/unit/year for each phase. The tax amounts are applied to unclosed inventory over the sell-off period. Property taxes are increased by 2% per year.
The subject is within the boundary of City of Menifee CFD No. 2023-1 (Rockport Ranch). The facilities special tax associated with the district, for the most recently available tax year amount to $3,157 and $2,719 per unit for North and West Shore at Rockport Ranch, respectively. The special taxes escalate at 2% per year. Based on the direct charges provided by the special tax consultant, it is estimated the subject would have direct charges of approximately $923 per lot. The total tax expense is gradually reduced over the absorption period, as the land components are sold off.
HOA
A homeowner’s association (HOA) is planned for the subject. According to the developer the estimated HOA fee applicable to the subject property is $205 per home per month, which is similar to other new home projects in the area and will therefore be utilized in the analysis.
Permits and Fees
Based on the information provided, the estimate of net permits and fees for the subject are estimated at $22,600 per lot.
Direct and Indirect Construction Costs
Construction costs are generally classified into direct and indirect costs. Direct costs reflect the cost of labor and materials to build the project. Direct costs generally are lower per square foot for larger floor plans, all else being equal, due to economies of scale. Indirect items are the carrying costs and fees incurred in developing the project and during the construction cycle. Construction quality and market-segment are significant factors that affect direct construction costs. In addition, City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 284
Menifee Mayor and City Council
November 6, 2024
Page
1379 of 1464
Land Residual Analysis 74
national/public builders, which are able to achieve lower costs due to the larger scale in which orders are placed, routinely achieve lower direct costs.
Recent conversations with homebuilders confirm construction costs have fluctuated over the last several quarters, but have moderated since the pandemic. Based on the cost comparables, and considering the product line under development, a direct cost estimate of $80.00 and $85.00 per square foot is applied the estimated home within North and West Shore at Rockport Ranch, respectively. These estimates are generally consistent with comparables in the market.
Regarding indirect costs, the following list itemizes some of the typical components that generally comprise indirect costs:
•
•
•
Architectural and engineering fees for plans, plan checks, surveys and environmental studies Appraisal, consulting, accounting and legal fees
The cost of carrying the investment in land and contract payments during construction. If the property is financed, the points, fees or service charges and interest on construction loans are considered
•
•
All-risk insurance
The cost of carrying the investment in the property after construction is complete, but before sell-out is achieved
•
•
Developer fee earned by the project coordinator
Interest reserve
Conversations with homebuilders indicate the indirect costs generally range anywhere from 10% to 15% of the direct costs (excluding marketing, sales, general and administrative expenses, taxes, which are accounted for separately). An estimate of 12% is considered reasonable for the subject.
Model Complex
North and West Shore at Rockport Ranch have constructed two and three model homes to service the subject communities, respectively. The subject communities benefit from having prospective buyers be able to visit the all models comprising the master plan. If the benchmark lot communities were being marketed separately, it is estimated each benchmark would have three model homes.
Model upgrade expenses can vary widely depending upon construction quality, targeted market and anticipated length of time on the market. These upgrades, exterior and interior, including furniture, can range from $20,000 per model to over $250,000 per model for executive homes.
Based on the quality of the subject’s proposed improvements and the targeted buyer segment, a model upgrade cost of $50,000 per model for each benchmark lot category is considered reasonable for the subject’s lots. Of this amount approximately 40% will be recaptured with the sale of the City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 285
Menifee Mayor and City Council
November 6, 2024
Page
1380 of 1464
Land Residual Analysis 75
models reflecting a recapture of $20,000 per model for each benchmark lot category. Model costs will be incurred in the first period while the recapture amount will be applied evenly over the disposition period.
Summary
The following chart summarizes the revenue and expenses discussed on the preceding pages.
Revenue & Expense Summary - North Shore at Rockport Ranch
REVENUE SUMMARY
No. of
Units
109
Unit
Size (SF)
2,400
Base Retail
Value Per Unit
$600,000
Floor Plan
Average Unit
$/SF
$250
Extension
$65,400,000
Model Recapture (@ 40% of cost) $60,000
Total Revenue Before Appreciation:
Total Revenue After Appreciation:
$
$
65,460,000
$600,550 /unit
65,460,000
$600,550 /unit
EXPENSES SUMMARY
Total Over Sell-Off Period
General and Administrative
Marketing and Sales
Ad Valorem Taxes
3.0% of total revenue
6.0% of total revenue
$
$
$
$
$
$
$
$
$
1,963,800
3,927,600
$2,556 /unit/year
$923 /unit/year
$3,157 /unit/year
$205 /unit/month
3 models
100,873 (from cash flow)
36,422 (from cash flow)
124,573 (from cash flow)
382,223 (from cash flow)
150,000
2,463,400
9,148,890
Direct Charges
Special Taxes/Assessments
Homeowner's Association Fees
Model Costs
Permits and Fees
Subtotal:
$50,000 (per model)
$22,600 (per unit)
Direct Construction Costs (Before Appreciation)
Average/Typical Floor Plan
SF
2,400
Units
109
Cost/SF
$80.00
Extension
20,928,000$ $192,000 /unit
$23,040 /unitIndirect Construction Costs
Subtotal:
12% of Direct Costs $
$
2,511,360
23,439,360
Total Expenses Before Appreciation: $ 32,588,250
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 286
Menifee Mayor and City Council
November 6, 2024
Page
1381 of 1464
Land Residual Analysis 76
Revenue & Expense Summary - West Shore at Rockport Ranch
REVENUE SUMMARY
No. of
Units
96 Unit
Size (SF)
2,000
Base Retail
Value Per Unit
$530,000
Floor Plan $/SF
$265
Extension
Average Unit $50,880,000
Model Recapture (@ 40% of cost) $60,000
Total Revenue Before Appreciation:
Total Revenue After Appreciation:
$
$
50,940,000
$530,625 /unit
50,940,000
$530,625 /unit
EXPENSES SUMMARY
Total Over Sell-Off Period
General and Administrative
Marketing and Sales
Ad Valorem Taxes
3.0% of total revenue
6.0% of total revenue
$
$
$
$
$
$
$
$
$
1,528,200
3,056,400
61,841 (from cash flow)
25,214 (from cash flow)
74,285 (from cash flow)
265,680 (from cash flow)
150,000
2,169,600
7,331,219
$2,264 /unit/year
$923 /unit/year
$2,719 /unit/year
$205 /unit/month
3 models
Direct Charges
Special Taxes/Assessments
Homeowner's Association Fees
Model Costs
Permits and Fees
Subtotal:
$50,000 (per model)
$22,600 (per unit)
Direct Construction Costs (Before Appreciation)
Average/Typical Floor Plan
SF
2,000
Units
96 Cost/SF
$85.00
Extension
16,320,000$ $170,000 /unit
$20,400 /unitIndirect Construction Costs
Subtotal:
12% of Direct Costs $
$
1,958,400
18,278,400
Total Expenses Before Appreciation: $ 25,609,619
Internal Rate of Return and Discount Rate
Positive attributes of the subject property include steady demand in the market area and limited new construction. There are some “negative” attributes associated with the subject such as rising construction costs, in addition to the potential for deterioration in market conditions in the residential sector that would result from a change in macroeconomic factors (ex. continued high inflation, unemployment rates, interest rates, etc.).
Using a 5.00% present value factor and 10.00% for developer’s incentive for North Shore at Rockport Ranch and West Shore at Rockport Ranch, results in an implied internal rate of return (IRR) of 18.16% for North Shore at Rockport Ranch and 20.80% for West Shore at Rockport Ranch.
Realty Rates provides expected Developer IRR for California developments as follows:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 287
Menifee Mayor and City Council
November 6, 2024
Page
1382 of 1464
Land Residual Analysis 77
The survey above is primarily focused on raw land development; whereas, the subject property is analyzed herein as if improved (finished lot, or improved site, condition), which carries less risk.
Furthermore, each implied IRR for the benchmark lot categories is within the range presented by the RealtyRates survey and are considered to be reasonable.
Conclusion
The land residual analysis is presented as follows:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 288
Menifee Mayor and City Council
November 6, 2024
Page
1383 of 1464
Land Residual Analysis 78
Land Residual Analysis - North Shore at Rockport Ranch
Quarter: 0 1 2 3 4 5 6 7 8 9 10 11 12 Total
ABSORPTION
Sales
Close of Escrow (COE)
10.50 0.00
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
10.50 10.50
4.00 10.50
0 4.00
109
109
Unsold Inventory 109
0%
98.50 88.00 77.50 67.00 56.50 46.00 35.50 25.00 14.50 4.00 0.00 0.00 Sales Revenue (Before Appreciation)
Annual Appreciation Factor
Sales Revenue (After Appreciation)
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 6,305,780
1.0000
6,305,780
$ 2,402,202
1.0000
2,402,202
$ -
1.0000
-$ $ $ $ $ $ $ $ $ $ $ $ $ 65,460,000
Total Sales Revenue (at Close of Escrow) $ - $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 6,305,780 $ 2,402,202 $ 65,460,000
EXPENSES AND CASH FLOWS
General and Administrative
Marketing and Sales
Ad Valorem Taxes ($/unit/yr)
Direct Charges ($/unit/yr)
Special Taxes/Assessments ($/unit/yr)
Homeowner's Association Fees ($/unit/mo)
Model Costs
3.0%
6.0%
$2,556
$923
$3,157
$205
$ (163,650)
-
(17,415)
(6,288)
(21,506)
(67,035)
(150,000)
(237,300)
(663,194)
$ (163,650)
(378,347)
(15,816)
(5,711)
(19,532)
(60,578)
-
$ (163,650)
(378,347)
(14,201)
(5,127)
(17,537)
(54,120)
-
$ (163,650)
(378,347)
(12,569)
(4,538)
(15,522)
(47,663)
-
$ (163,650)
(378,347)
(10,920)
(3,943)
(13,486)
(41,205)
-
$ (163,650)
(378,347)
(9,255)
$ (163,650)
(378,347)
(7,573)
(2,734)
(9,352)
(28,290)
-
$ (163,650)
(378,347)
(5,873)
(2,121)
(7,253)
(21,833)
-
$ (163,650)
(378,347)
(4,157)
(1,501)
(5,133)
(15,375)
-
$ (163,650)
(378,347)
(2,423)
(875)
(2,992)
(8,918)
-
$ (163,650)
(378,347)
(672)
(243)
(830)
(2,460)
-
(90,400)
(636,601)
$ (163,650)
(144,132)
$ (1,963,800)
(3,927,600)
(100,873)
(36,422)
(124,573)
(382,223)
(150,000)
(2,463,400)
(9,148,890)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
-
-
-
-
-
-
(3,342)
(11,429)
(34,748)
-
(237,300)
(838,070)
Permits and Fees
Subtotal:
(237,300)
(880,933)
(237,300)
(870,282)
(237,300)
(859,588)
(237,300)
(848,851)
(237,300)
(827,245)
(237,300)
(816,377)
(237,300)
(805,463)
(237,300)
(794,504) (307,782)
Direct Construction Costs
Annual Appreciation Factor
Direct Construction Costs (Appreciated)
$
$
(1,008,000)
1.0000
(1,008,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(2,016,000)
1.0000
(2,016,000)
$
$
(1,392,000)
1.0000
(1,392,000)
$
$
(384,000)
1.0000
(384,000)
0%
$(20,928,000)
Indirect Construction Costs
Subtotal:
12% $
$
(120,960)
(1,128,960)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(241,920)
(2,257,920)
$
$
(167,040)
(1,559,040)
$
$
(46,080)
(430,080)
$ (2,511,360)
$(23,439,360)
Total Expenses $
$
(1,792,154)
(1,792,154)
-
$
$
$
$
(3,138,853)
3,166,927
(630,578)
2,536,349
$
$
$
$
(3,128,202)
3,177,578
(630,578)
2,547,000
$
$
$
$
(3,117,508)
3,188,272
(630,578)
2,557,694
$
$
$
$
(3,106,771)
3,199,009
(630,578)
2,568,431
$
$
$
$
(3,095,990)
3,209,790
(630,578)
2,579,212
$
$
$
$
(3,085,165)
3,220,614
(630,578)
2,590,036
$
$
$
$
(3,074,297)
3,231,483
(630,578)
2,600,905
$
$
$
$
(3,063,383)
3,242,397
(630,578)
2,611,819
$
$
$
$
(3,052,424)
3,253,355
(630,578)
2,622,777
$
$
$
$
(2,195,641)
4,110,139
(630,578)
3,479,561
$
$
$
$
(737,862)
1,664,340
(240,220)
1,424,120
$(32,588,250)
$ 32,871,750NET INCOME BEFORE DEVELOPER'S INCENTIVE
Developers Incentive 10.00%
5.00%
$ $ (6,546,000)
NET INCOME BEFORE DISCOUNTING $ (1,792,154) $ 26,325,750 Present Value Factors
Discount Rate 0.98765 0.97546 0.96342 0.95152 0.93978 0.92817 0.91672 0.90540 0.89422 0.88318 0.87228 0.86151 Discounted Cash Flow
Net Present Value (Rounded)
$
$
(1,770,029) $
$
2,474,110 $
$
2,453,826 $
$
2,433,708 $
$
2,413,752 $
$
2,393,959 $
$
2,374,328 $
$
2,354,856 $
$
2,335,542 $
$
2,316,387 $
$
3,035,143 $
$
1,226,891 $ 24,042,474
$ 24,040,000
$220,550per unit:
(1,792,154) 3,166,927 3,177,578 3,188,272 3,199,009 3,209,790 3,220,614 3,231,483 3,242,397 3,253,355 4,110,139 1,664,340 Implied Internal Rate of Return (IRR) 18.16%
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 289
Menifee Mayor and City Council
November 6, 2024
Page
1384 of 1464
Land Residual Analysis 79
Land Residual Analysis - West Shore at Rockport Ranch
Quarter: 0 1 2 3 4 5 6 7 8 9 Total
ABSORPTION
Sales
Close of Escrow (COE)
12 0
12 12
12 12
12 12
12 12
12 12
12 12
12 12
0 12
96 96
Unsold Inventory 96 84 72 60 48 36 24 12 0 0
Sales Revenue (Before Appreciation)
Annual Appreciation Factor
Sales Revenue (After Appreciation)
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
6,367,500
1.0000
6,367,500
$
$
$
-
1.0000
-
0%
$ 50,940,000
Total Sales Revenue (at Close of Escrow) - 6,367,500 6,367,500 6,367,500 6,367,500 6,367,500 6,367,500 6,367,500 6,367,500 $ 50,940,000
EXPENSES AND CASH FLOWS
General and Administrative
Marketing and Sales
Ad Valorem Taxes ($/unit/yr)
Direct Charges ($/unit/yr)
Special Taxes/Assessments ($/unit/yr)
Homeowner's Association Fees ($/unit/mo)
Model Costs
3.0%
6.0%
$2,264
$923
$2,719
$205
$ (169,800)
-
(13,583)
(5,538)
(16,316)
(59,040)
(150,000)
(271,200)
(685,477)
$ (169,800)
(382,050)
(11,944)
(4,870)
(14,348)
(51,660)
$ (169,800)
(382,050)
(10,289)
(4,195)
(12,360)
(44,280)
-
$ (169,800)
(382,050)
(8,617)
$ (169,800)
(382,050)
(6,928)
(2,825)
(8,322)
(29,520)
-
$ (169,800)
(382,050)
(5,222)
(2,129)
(6,273)
(22,140)
-
$ (169,800)
(382,050)
(3,499)
(1,427)
(4,203)
(14,760)
-
$ (169,800)
(382,050)
(1,758)
(717)
(2,112)
(7,380)
-
$ (169,800)
(382,050)
$
$
(1,528,200)
(3,056,400)
$ (61,841)
(25,214)
(74,285)
(265,680)
(150,000)
(2,169,600)
(7,331,219)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
-
-
-
-
-
-
(3,513) $
$
$
$
$
$
(10,351)
(36,900)
-
(271,200)
(882,432)
Permits and Fees
Subtotal:
$
$
(271,200)
(905,872)
(271,200)
(894,174)
(271,200)
(870,645)
(271,200)
(858,814)
(271,200)
(846,938)
(271,200)
(835,017) (551,850)
Direct Construction Costs
Annual Appreciation Factor
Direct Construction Costs (Appreciated)
$
$
(1,020,000)
1.0000
(1,020,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(2,040,000)
1.0000
(2,040,000)
$
$
$
(1,020,000)
1.0000
(1,020,000)
0%
$ (16,320,000)
Indirect Construction Costs
Subtotal:
12% $
$
(122,400) (244,800) (244,800) (244,800) (244,800) (244,800) (244,800) (244,800) (122,400) $ (1,958,400) (1,142,400) $ (2,284,800) $ (2,284,800) $ (2,284,800) $ (2,284,800) $ (2,284,800) $ (2,284,800) $ (2,284,800) $ (1,142,400) $ (18,278,400) Total Expenses $
$
(1,827,877) $ (3,190,672) $ (3,178,974) $ (3,167,232) $ (3,155,445) $ (3,143,614) $ (3,131,738) $ (3,119,817) $ (1,694,250) $ (25,609,619)
NET INCOME BEFORE DEVELOPER'S INCENTIVE
Developers Incentive
(1,827,877)
-
$
$
$
3,176,828
(636,750)
2,540,078
$
$
$
3,188,526
(636,750)
2,551,776
$
$
$
3,200,268
(636,750)
2,563,518
$
$
$
3,212,055
(636,750)
2,575,305
$
$
$
3,223,886
(636,750)
2,587,136
$
$
$
3,235,762
(636,750)
2,599,012
$
$
$
3,247,683
(636,750)
2,610,933
$
$
$
4,673,250
(636,750)
4,036,500
$ 25,330,381
(5,094,000)
$ 20,236,381
10.00%
5.00%
$ $
NET INCOME BEFORE DISCOUNTING $ (1,827,877)
Present Value Factors
Discount Rate 0.98765 0.97546 0.96342 0.95152 0.93978 0.92817 0.91672 0.90540 0.89422 Discounted Cash Flow
Net Present Value (Rounded)
$
$
(1,805,310) $ 2,477,747 $
$
2,458,428 $
$
2,439,250 $
$
2,420,212 $
$
2,401,314 $
$
2,382,555 $
$
2,363,935 $
$
3,609,522 $
$
18,747,653
18,750,000
$195,313per unit:
(1,827,877) $ 3,176,828 3,188,526 3,200,268 3,212,055 3,223,886 3,235,762 3,247,683 4,673,250 Implied Internal Rate of Return (IRR) 20.80%
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 290
Menifee Mayor and City Council
November 6, 2024
Page
1385 of 1464
Reconciliation of Lot Value 80
Reconciliation of Lot Value
The concluded estimates of lot value via each approach are shown below. In our opinion, both approaches to value are considered to be good indicators of value and are given equal emphasis in our conclusion. We conclude a finished lot value as follows:
Reconciliation of Finished Lot Value
North Shore at Rockport
Ranch
West Shore at Rockport
RanchLot Size Categories
Sales Comparison Approach
Land Residual Analysis
$227,000 per finished lot
$220,550 per finished lot
$192,000 per finished lot
$195,313 per finished lot
% Difference
Average
2.92%
$223,775
-1.70%
$193,656
Concluded Finished Lot Value $224,000 per finished lot $194,000 per finished lot Using the conclusion of market value for the North Shore benchmark lot above, a lot size adjustment factor of $10.00 per square foot of difference in lot area is applied in order to estimate the market value for the subject's South Shore at Rockport Ranch lots (6,500 square feet).
As noted, South Shore at Rockport Ranch has 33 lots that have a waterfront premium and achieve a premium in comparison to the other lots. Based on conversations with the sales agents, these lots achieve a premium of approximately $20,000 per lot. The seller of these lots would not receive the full benefit of the premium achieved. Therefore, we will adjust accordingly for the additional premium achieved for the waterfront lots. The finished lot market value conclusion for the three subject lot categories is presented in the following table.
Conclusion of Finished Lot Value
Adjusted
Lot Size
(SF)
Benchmark Lot Lot Size Waterfront
Adjustment
Finished Lot
Value (Rounded)
$224,000
$194,000
$232,500
Community Value
Benchmark $224,000
Benchmark $194,000
$224,000
Adjustment
North Shore at Rockport Ranch 6,000
West Shore at Rockport Ranch 3,600
South Shore at Rockport Ranch 6,500 $5,000 $3,500
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 291
Menifee Mayor and City Council
November 6, 2024
Page
1386 of 1464
Market Value by Ownership 81
Market Value by Ownership
In this section, the previously concluded market values will be allocated to each ownership group comprising the appraised properties in order to provide a market value of the appraised properties by ownership. A summary of the along with the current development status is provided in the following table.
Appraised Property Summary
Partially-
Improved SFR
Partially
Completed
Homes
35 Total
Appraised
Parcels
90 Completed Homes Sold to Assessed
Parcels
19 Community
North Shore at Rockport Ranch
Lots
20 21
5 Homes* Individuals*
2 4
0 33
39 40
South Shore at Rockport Ranch
West Shore at Rockport Ranch
22 33
86 78
14 18
TOTAL 46 90 6 112 254 51
*Completed homes without a complete assessment for structural improvements by County Assessor Of the 51 assessed parcel, three of the parcels are model homes of West Shore at Rockport Ranch and the remainder of the parcels represent completed homes held by individual homeowners within the three communities comprising the subject.
As previously noted, there are remaining site development costs of $6,215,155. These costs will be allocated and deducted from the partially-completed lots and lots with home under construction, which totals 136 lots. A profit factor of 5%, or $310,758 ($6,215,155 x 5%), is applied to provide an incentive for a prospective buyer to oversee the remaining site development of the subject property for a total of $6,525,913 or $47,985 per lot will be considered in the following analysis. The remaining costs are not allocated to the completed homes.
Based on the previous analyses, the estimates of market value, by ownership, subject to the impact of the Lien of the Special Tax securing the City of Menifee CFD No. 2023-1 (Rockport Ranch), Series 2024 bonds, as of the date of value, August 30, 2024, are presented in the following table. As previously noted, for the lots with homes under construction, the contributory value of permits and impact fees paid is accounted for in this analysis.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 292
Menifee Mayor and City Council
November 6, 2024
Page
1387 of 1464
Market Value by Ownership 82
Market Value by Ownership
Lots/Parcels Lot/Home Remaining Site
Development Costs
Permits and
Fees
Value per
Component/Homes Value Market Value (Rd.)
Lennar Homes of California, LLC / AG EHC II (LEN) CA 1, L.P.
Partially-Improved Lots
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
Homes Under Construction
20 21
5 $224,000
$232,500
$194,000
($47,985)
($47,985)
($47,985)
-
-
-
$176,015
$184,515
$146,015
$3,520,000
$3,875,000
$730,000
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
Completed Homes
35 22
33 $224,000
$232,500
$194,000
($47,985)
($47,985)
($47,985)
$22,600
$22,600
$22,600
$198,615
$207,115
$168,615
$6,952,000
$4,557,000
$5,564,000
North Shore at Rockport Ranch
South Shore at Rockport Ranch
2 4
$530,000
$550,000
-
-
-
-
$530,000
$550,000
$1,060,000
$2,200,000
(Not-Less-Than)
(Not-Less-Than)
Total - Lennar Homes of California, LLC / AG EHC II (LEN) CA 1, L.P. 142 $28,458,000 Individual Homeowners
Completed Homes
North Shore at Rockport Ranch
South Shore at Rockport Ranch
West Shore at Rockport Ranch
33 39
40 $530,000
$550,000
$515,000
-
-
-
-
-
-
$530,000
$550,000
$515,000
$17,490,000
$21,450,000
$20,600,000
(Not-Less-Than)
(Not-Less-Than)
(Not-Less-Than)
Total - Individual Homeowners 112
254
$59,540,000
$87,998,000Aggregate, or Cumulative, Appraised Values
Aggregate, or Cumulative, Assessed Values 51 $28,930,504 Total Aggregate, or Cumulative, Value of CFD No. 2023-1 (Rockport Ranch)
305 $116,928,504
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. (None)
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.
1. The value derived herein is based on the hypothetical condition that certain impact fees to be financed by the CFD No. 2023-1 Revenue Bonds, Series 2024, have been paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
Exposure Time
Exposure time is the length of time the subject property would have been exposed for sale in the market had it sold on the effective valuation date at the concluded market value. Exposure time is always presumed to precede the effective date of the appraisal. Based on our review of recent sales transactions for similar properties and our analysis of supply and demand in the local residential land market, it is our opinion that the probable exposure time for the subject at the concluded market values stated previously is 6-9 months. As it relates to the completed home component of the subject, current market conditions indicate that 30-to-60-day exposure period is reasonable.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 293
Menifee Mayor and City Council
November 6, 2024
Page
1388 of 1464
Market Value by Ownership 83
Marketing Time
Marketing time is an estimate of the amount of time it might take to sell a property at the concluded market value immediately following the effective date of value. As we foresee no significant changes in market conditions in the near term, it is our opinion that a reasonable marketing period for the subject in bulk is likely to be the same as the exposure time. Accordingly, we estimate the subject’s marketing period at 6-9 months.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 294
Menifee Mayor and City Council
November 6, 2024
Page
1389 of 1464
Certification 84
Certification
We certify that, to the best of our knowledge and belief:
1. 2.
The statements of fact contained in this report are true and correct.
The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions.
3. 4.
We have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.
We have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment.
5. 6.
7. We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.
Our engagement in this assignment was not contingent upon developing or reporting predetermined results.
Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.
8. 9.
Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice as well as applicable state appraisal regulations.
The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.
10. 11.
12. 13.
14. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
Blake Fassler has not made a personal inspection of the property that is the subject of this report. Kevin Ziegenmeyer, MAI, and Eric Segal, MAI, have personally inspected the subject.
No one provided significant real property appraisal assistance to the person(s) signing this certification.
We have experience in appraising properties similar to the subject and are in compliance with the Competency Rule of USPAP.
As of the date of this report, Kevin Ziegenmeyer, MAI, and Eric Segal, MAI, have completed the continuing education program for Designated Members of the Appraisal Institute.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 295
Menifee Mayor and City Council
November 6, 2024
Page
1390 of 1464
Certification 85
Blake Fassler Kevin Ziegenmeyer, MAI
Certified General Real Estate Appraiser
California Certificate # 3007274
Certified General Real Estate Appraiser
California Certificate # AG013567
Eric Segal, MAI
Certified General Real Estate Appraiser
California Certificate # AG026558
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 296
Menifee Mayor and City Council
November 6, 2024
Page
1391 of 1464
Assumptions and Limiting Conditions 86
Assumptions and Limiting Conditions
This appraisal and any other work product related to this engagement are limited by the following standard assumptions, except as otherwise noted in the report:
1. The title is marketable and free and clear of all liens, encumbrances, encroachments, easements and restrictions. The property is under responsible ownership and competent management and is available for its highest and best use.
2. 3.
4. 5.
6. There are no existing judgments or pending or threatened litigation that could affect the value of the property.
There are no hidden or undisclosed conditions of the land or of the improvements that would render the property more or less valuable. Furthermore, there is no asbestos in the property.
The revenue stamps placed on any deed referenced herein to indicate the sale price are in correct relation to the actual dollar amount of the transaction.
The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes.
The information furnished by others is believed to be reliable, but no warranty is given for its accuracy.
This appraisal and any other work product related to this engagement are subject to the following limiting conditions, except as otherwise noted in the report:
1. 2.
3. 4.
An appraisal is inherently subjective and represents our opinion as to the value of the property appraised.
The conclusions stated in our appraisal apply only as of the effective date of the appraisal, and no representation is made as to the effect of subsequent events.
No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated.
No environmental impact studies were either requested or made in conjunction with this appraisal, and we reserve the right to revise or rescind any of the value opinions based upon any subsequent environmental impact studies. If any environmental impact statement is required by law, the appraisal assumes that such statement will be favorable and will be approved by the appropriate regulatory bodies.
5. 6.
Unless otherwise agreed to in writing, we are not required to give testimony, respond to any subpoena or attend any court, governmental or other hearing with reference to the property without compensation relative to such additional employment.
We have made no survey of the property and assume no responsibility in connection with such matters. Any sketch or survey of the property included in this report is for illustrative purposes only and should not be considered to be scaled accurately for size. The appraisal City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 297
Menifee Mayor and City Council
November 6, 2024
Page
1392 of 1464
Assumptions and Limiting Conditions 87
covers the property as described in this report, and the areas and dimensions set forth are assumed to be correct.
7. 8.
No opinion is expressed as to the value of subsurface oil, gas or mineral rights, if any, and we have assumed that the property is not subject to surface entry for the exploration or removal of such materials, unless otherwise noted in our appraisal.
We accept no responsibility for considerations requiring expertise in other fields. Such considerations include, but are not limited to, legal descriptions and other legal matters such as legal title, geologic considerations such as soils and seismic stability; and civil, mechanical, electrical, structural and other engineering and environmental matters. Such considerations may also include determinations of compliance with zoning and other federal, state, and local laws, regulations and codes.
9. The distribution of the total valuation in the report between land and improvements applies only under the reported highest and best use of the property. The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used. The appraisal report shall be considered only in its entirety. No part of the appraisal report shall be utilized separately or out of context.
10. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or any reference to the Appraisal Institute) shall be disseminated through advertising media, public relations media, news media or any other means of communication (including without limitation prospectuses, private offering memoranda and other offering material provided to prospective investors) without the prior written consent of the persons signing the report.
11. 12.
13. Information, estimates and opinions contained in the report and obtained from third-party sources are assumed to be reliable and have not been independently verified.
Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results.
If the property is subject to one or more leases, any estimate of residual value contained in the appraisal may be particularly affected by significant changes in the condition of the economy, of the real estate industry, or of the appraised property at the time these leases expire or otherwise terminate.
14. Unless otherwise stated in the report, no consideration has been given to personal property located on the premises or to the cost of moving or relocating such personal property; only the real property has been considered.
15. 16.
The current purchasing power of the dollar is the basis for the values stated in the appraisal; we have assumed that no extreme fluctuations in economic cycles will occur.
The values found herein are subject to these and to any other assumptions or conditions set forth in the body of this report but which may have been omitted from this list of Assumptions and Limiting Conditions.
17. The analyses contained in the report necessarily incorporate numerous estimates and assumptions regarding property performance, general and local business and economic City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 298
Menifee Mayor and City Council
November 6, 2024
Page
1393 of 1464
Assumptions and Limiting Conditions 88
conditions, the absence of material changes in the competitive environment and other matters. Some estimates or assumptions, however, inevitably will not materialize, and unanticipated events and circumstances may occur; therefore, actual results achieved during the period covered by our analysis will vary from our estimates, and the variations may be material.
18. The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific survey or analysis of the property to determine whether the physical aspects of the improvements meet the ADA accessibility guidelines. We claim no expertise in ADA issues, and render no opinion regarding compliance of the subject with ADA regulations.
Inasmuch as compliance matches each owner’s financial ability with the cost to cure the non- conforming physical characteristics of a property, a specific study of both the owner’s financial ability and the cost to cure any deficiencies would be needed for the Department of Justice to determine compliance.
19. 20.
The appraisal report is prepared for the exclusive benefit of the Client, its subsidiaries and/or affiliates. It may not be used or relied upon by any other party. All parties who use or rely upon any information in the report without our written consent do so at their own risk.
No studies have been provided to us indicating the presence or absence of hazardous materials on the subject property or in the improvements, and our valuation is predicated upon the assumption that the subject property is free and clear of any environment hazards including, without limitation, hazardous wastes, toxic substances and mold. No representations or warranties are made regarding the environmental condition of the subject property. Integra Realty Resources – Los Angeles, Integra Realty Resources, Inc., Integra Strategic Ventures, Inc. and/or any of their respective officers, owners, managers, directors, agents, subcontractors or employees (the “Integra Parties”), shall not be responsible for any such environmental conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because we are not experts in the field of environmental conditions, the appraisal report cannot be considered as an environmental assessment of the subject property.
21. 22.
The persons signing the report may have reviewed available flood maps and may have noted in the appraisal report whether the subject property is located in an identified Special Flood Hazard Area. We are not qualified to detect such areas and therefore do not guarantee such determinations. The presence of flood plain areas and/or wetlands may affect the value of the property, and the value conclusion is predicated on the assumption that wetlands are non- existent or minimal.
Integra Realty Resources – Los Angeles is not a building or environmental inspector. Integra Los Angeles does not guarantee that the subject property is free of defects or environmental problems. Mold may be present in the subject property and a professional inspection is recommended.
23. 24.
The appraisal report and value conclusions for an appraisal assume the satisfactory completion of construction, repairs or alterations in a workmanlike manner.
It is expressly acknowledged that in any action which may be brought against any of the Integra Parties, arising out of, relating to, or in any way pertaining to this engagement, the City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 299
Menifee Mayor and City Council
November 6, 2024
Page
1394 of 1464
Assumptions and Limiting Conditions 89
appraisal reports, and/or any other related work product, the Integra Parties shall not be responsible or liable for any incidental or consequential damages or losses, unless the appraisal was fraudulent or prepared with intentional misconduct. It is further acknowledged that the collective liability of the Integra Parties in any such action shall not exceed the fees paid for the preparation of the appraisal report unless the appraisal was fraudulent or prepared with intentional misconduct. Finally, it is acknowledged that the fees charged herein are in reliance upon the foregoing limitations of liability.
25. Integra Realty Resources – Los Angeles, an independently owned and operated company, has prepared the appraisal for the specific intended use stated elsewhere in the report. The use of the appraisal report by anyone other than the Client is prohibited except as otherwise provided. Accordingly, the appraisal report is addressed to and shall be solely for the Client’s use and benefit unless we provide our prior written consent. We expressly reserve the unrestricted right to withhold our consent to your disclosure of the appraisal report or any other work product related to the engagement (or any part thereof including, without limitation, conclusions of value and our identity), to any third parties. Stated again for clarification, unless our prior written consent is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable).
26. The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. The Integra Parties are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance. While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, we assume competent and effective management and marketing for the duration of the projected holding period of this property.
27. 28.
All prospective value opinions presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc. It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future.
The appraisal is also subject to the following:
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 300
Menifee Mayor and City Council
November 6, 2024
Page
1395 of 1464
Assumptions and Limiting Conditions 90
Extraordinary Assumptions and Hypothetical Conditions
The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. (None)
The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.
1. The value derived herein is based on the hypothetical condition that certain impact fees to be financed by the CFD No. 2023-1 Revenue Bonds, Series 2024, have been paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 301
Menifee Mayor and City Council
November 6, 2024
Page
1396 of 1464
Addenda
Addendum A
Appraiser Qualifications
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 302
Menifee Mayor and City Council
November 6, 2024
Page
1397 of 1464
Blake Fassler
Integra Realty Resources -
Sacramento
Experience 590 Menlo Drive
Suite 1
Rocklin, CA 95765Mr. Fassler is a licensed appraiser with Integra Realty Resources, a real estate appraisal firm that engages in a wide variety of real estate valuation and consultation assignments.
He began his appraisal career in March 2017 with Seevers Jordan Ziegenmeyer in Rocklin, California. Currently, Mr. Fassler is obtaining experience in the valuation and analysis of various types of real estate by working on a wide variety of property typed including, but not limited to: multifamily, office, retail, industrial, vacant land, and residential subdivisions. He also specializes in the
irr.com
appraisal of residential master planned communities and subdivision, as well as Mello Roos and Assessment Districts for land secured municipal financings.
Licenses
California, California Certified General Real Estate Appraiser, 3007274, Expires February 2026
Education
Bachelor of Science in Management Science University of California, San Diego Appraisal Courses Completed are as follows:
Basic Appraisal Principles
Basic Appraisal Procedures
General Appraiser Market Analysis & Highest and Best Use (USPAP), Uniform Standards of Professional Appraisal Practice General Appraiser Report Writing and Case Studies
General Appraiser Site Valuation and Cost Approach
General Appraiser Sales Comparison Approach
General Appraiser Income Approach Part 1
General Appraiser Income Approach Part 2
4-Hour Federal and California Statutory and Regulator Laws [email protected] - 916-435-3883
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 303
Menifee Mayor and City Council
November 6, 2024
Page
1398 of 1464
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 304
Menifee Mayor and City Council
November 6, 2024
Page
1399 of 1464
Kevin Ziegenmeyer, MAI
Integra Realty Resources -
Sacramento
Experience 590 Menlo Drive
Suite 1
Rocklin, CA 95765Mr. Ziegenmeyer is a Certified General real estate appraiser and holds the Appraisal Institute's MAI designation. In 1989, Mr. Ziegenmeyer began his career in real estate as a controller for a commercial and residential real estate development corporation. In 1991 he began appraising and continued to be involved in appraisal assignments covering a wide variety of properties, including office, retail, industrial, residential income and subdivisions throughout the state of California, and Northern Nevada. Mr. Ziegenmeyer handles many of the firm’s master-planned property appraisals and over the past two decades has developed expertise in the valuation of Community Facilities Districts and Assessment Districts.In fact, Mr. Ziegenmeyer was one of five appraisers to collaborate with other professionals in developing the appraisal guidelines for the California Debt and Investment Advisory Commission (Recommended Practices in the Appraisal of Real Estate for Land-Secured Financing - 2004). He has developed the experience and background necessary to deal with complex assignments covering an array of property types, with a particular focus on urban redevelopment in the cities and counties of San Francisco, Dublin, Monterey, Newport Beach, Alameda, Napa and San Mateo. In early 2015, Mr. Ziegenmeyer obtained the Appraisal Institute's MAI designation.
T 916.435.3883
F 916.435.4774
irr.com
Licenses
California, California Certified General Real Estate Appraiser, AG013567, Expires June 2025
Education
Academic:
Bachelor of Science in Accounting, Azusa Pacific University, California Appraisal and Real Estate Courses:
Standards of Professional Practice, Parts A, B & C
Basic Valuation Procedures
Real Estate Appraisal Principles
Capitalization Theory and Techniques, Part A
Advanced Income Capitalization
Report Writing and Valuation Analysis
Advanced Applications
IRS Valuation Summit I & II
2008, 2009, 2010 & 2011 Economic Forecast
Business Practices and Ethics
Contemporary Appraisal Issues with Small Business Administration Financing General Demonstration Appraisal Report Writing Seminar
7-Hour National USPAP Update Course
Valuation of Easements and Other Partial Interests
2009 Summer Conference
Uniform Appraisal Standards for Federal Land Acquisitions (Yellowbook) 2008 Economic Update
Valuation of Conservation Easements
Subdivision Valuation
2005 Annual Fall Conference
General Comprehensive Exam Module I, II, III & IV
Advanced Income Capitalization
[email protected] - 916.435.3883 x224
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 305
Menifee Mayor and City Council
November 6, 2024
Page
1400 of 1464
Kevin Ziegenmeyer, MAI
Integra Realty Resources -
Sacramento
Education (Cont'd) 590 Menlo Drive
Suite 1
Rocklin, CA 95765Advanced Sales Comparison & Cost Approaches 2004 Central CA Market Update
Computer-Enhanced Cash Flow Modeling
Forecast 2000, 2001, 2002, 2003 & 2004
Land Valuation Assignments
T 916.435.3883
F 916.435.4774
Land Valuation Adjustment Procedures
Highest & Best Use and Market Analysis
Entitlements, Land Subdivision & Valuation
Real Estate Value Cycles
irr.com
El Dorado Hills Housing Symposium
Federal Land Exchanges
M & S Computer Cost-Estimating, Nonresidential
[email protected] - 916.435.3883 x224
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 306
Menifee Mayor and City Council
November 6, 2024
Page
1401 of 1464
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 307
Menifee Mayor and City Council
November 6, 2024
Page
1402 of 1464
Eric Segal, MAI
Integra Realty Resources – Los
Angeles
Experience 12100 Wilshire Boulevard
Suite 800
Los Angeles, CA 90025Mr. Segal is a Certified General real estate appraiser and holds the Appraisal Institute's MAI designation. In 1998, Mr. Segal began his career in real estate as a research analyst/appraiser trainee for Richard Seevers and Associates. By 1999, he began writing narrative appraisal reports covering a variety of commercial properties, with an emphasis on residential master planned communities and subdivisions. Today, Mr. Segal is a partner in the firm and is involved in appraisal assignments covering a wide variety of properties including office, retail, industrial, multifamily housing, master planned communities, and specializes in the appraisal of Mello-Roos Community Facilities Districts and Assessment Districts for land-secured municipal financings, as well as multifamily developments under the U.S. Department of Housing and Urban Development’s Multifamily Accelerated Processing (MAP) Guide. He has developed the experience and background necessary to deal with complex assignments covering an array of property types, with a particular focus on urban redevelopment in the cities of San Francisco, Oakland, Monterey, Alameda and San Mateo. He has developed the experience and background necessary to deal with complex assignments covering an array of property types. Eric is currently Senior Managing Director of the Integra-Los Angeles office, and Managing Director of the Integra-Orange County, Integra-San Francisco and Integra-Sacramento offices.
T 213.948.4425
F 916.435.4774
irr.com
Professional Activities & Affiliations
MAI Designation, Appraisal Institute Appraisal Institute, January 2016 Licenses
California, Certified General Real Estate Appraiser, AG026558, Expires February 2025 Nevada, Certified General, A.0207666-CG, Expires January 2025 Arizona, Certified General, CGA - 1006422, Expires January 2026 Washington, Certified General, 20100611, Expires June 2025 Education
Academic:
Bachelor of Science in Business Administration (Concentrations in Finance and Real Estate & Land Use Affairs), California State University, Sacramento
Appraisal and Real Estate Courses:
Uniform Standards of Professional Appraisal Practice
Appraisal Principles
Basic Income Capitalization
Highest & Best Use and Market Analysis
Advanced Income Capitalization
Report Writing and Valuation Analysis
Self-Storage Economics and Appraisal Seminar
Appraisal Litigation Practice and Courtroom Management
Hotel Valuations: New Techniques for today’s Uncertain Times Computer Enhanced Cash Flow Modeling
Advanced Sales Comparison & Cost Approaches
Advanced Applications
Subdivision Valuation
Appraisal of Self-Storage Facilities
Appraisal of Fast Food Facilities
Appraisal of Limited Service Hotels
How Tenants Create or Destroy Value: Leasehold Valuation and its Impact on Value Appraisal of Manufactured Homes Featuring Next Generation Manufactured Homes [email protected] - 213.948.4425 x228
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 308
Menifee Mayor and City Council
November 6, 2024
Page
1403 of 1464
Eric Segal, MAI
Integra Realty Resources – Los
Angeles
Appraisal and Real Estate Courses (cont’d):
Business Practices and Ethics
IRS Valuation Update
12100 Wilshire Boulevard
Suite 800
Los Angeles, CA 90025
T 213.948.4425
F 916.435.4774
irr.com
[email protected] - 213.948.4425 x228
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 309
Menifee Mayor and City Council
November 6, 2024
Page
1404 of 1464
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 310
Menifee Mayor and City Council
November 6, 2024
Page
1405 of 1464
About IRR
Integra Realty Resources, Inc. (IRR) provides world-class commercial real estate valuation, counseling, and advisory services. Routinely ranked among leading property valuation and consulting firms, we are now the largest independent firm in our industry in the United States, with local offices coast to coast and in the Caribbean.
IRR offices are led by MAI-designated Senior Managing Directors, industry leaders who have over 25 years, on average, of commercial real estate experience in their local markets. This experience, coupled with our understanding of how national trends affect the local markets, empowers our clients with the unique knowledge, access, and historical perspective they need to make the most informed decisions.
Many of the nation's top financial institutions, developers, corporations, law firms, and government agencies rely on our professional real estate opinions to best understand the value, use, and feasibility of real estate in their market.
Local Expertise...Nationally!
irr.com
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 311
Menifee Mayor and City Council
November 6, 2024
Page
1406 of 1464
Addenda
Addendum B
Definitions
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 312
Menifee Mayor and City Council
November 6, 2024
Page
1407 of 1464
Addenda
Definitions
The source of the following definitions is the Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015), unless otherwise noted.
As Is Market Value
The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date.
Disposition Value
The most probable price that a specified interest in property should bring under the following conditions:
1. Consummation of a sale within a specified time, which is shorter than the typical exposure time for such a property in that market.
2. 3.
4. 5.
6. 7.
8. The property is subjected to market conditions prevailing as of the date of valuation.
Both the buyer and seller are acting prudently and knowledgeably.
The seller is under compulsion to sell.
The buyer is typically motivated.
Both parties are acting in what they consider to be their best interests.
An adequate marketing effort will be made during the exposure time.
Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto.
9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
This definition can also be modified to provide for valuation with specified financing terms.
Effective Date
1. The date on which the appraisal or review opinion applies.
2. In a lease document, the date upon which the lease goes into effect.
Entitlement
In the context of ownership, use, or development of real estate, governmental approval for annexation, zoning, utility extensions, number of lots, total floor area, construction permits, and occupancy or use permits.
Entrepreneurial Profit
1. A market-derived figure that represents the amount an entrepreneur receives for his or her contribution to a project and risk; the difference between the total cost of a property (cost of City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 313
Menifee Mayor and City Council
November 6, 2024
Page
1408 of 1464
Addenda
development) and its market value (property value after completion), which represents the entrepreneur’s compensation for the risk and expertise associated with development. An entrepreneur is motivated by the prospect of future value enhancement (i.e., the entrepreneurial incentive). An entrepreneur who successfully creates value through new development, expansion, renovation, or an innovative change of use is rewarded by entrepreneurial profit. Entrepreneurs may also fail and suffer losses.
2. In economics, the actual return on successful management practices, often identified with coordination, the fourth factor of production following land, labor, and capital; also called entrepreneurial return or entrepreneurial reward.
Exposure Time
1. The time a property remains on the market.
2. The estimated length of time that the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal; a retrospective opinion based on an analysis of past events assuming a competitive and open market.
Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.
Floor Area Ratio (FAR)
The relationship between the above-ground floor area of a building, as described by the zoning or building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area.
Highest and Best Use
1. The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity.
2. The use of an asset that maximizes its potential and that is possible, legally permissible, and financially feasible. The highest and best use may be for continuation of an asset’s existing use or for some alternative use. This is determined by the use that a market participant would have in mind for the asset when formulating the price that it would be willing to bid. (ISV)
3. [The] highest and most profitable use for which the property is adaptable and needed or likely to be needed in the reasonably near future. (Uniform Appraisal Standards for Federal Land Acquisitions)
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 314
Menifee Mayor and City Council
November 6, 2024
Page
1409 of 1464
Addenda
Investment Value
1. The value of a property to a particular investor or class of investors based on the investor’s specific requirements. Investment value may be different from market value because it depends on a set of investment criteria that are not necessarily typical of the market.
2. The value of an asset to the owner or a prospective owner for individual investment or operational objectives.
Lease
A contract in which rights to use and occupy land, space, or structures are transferred by the owner to another for a specified period of time in return for a specified rent.
Leased Fee Interest
The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.
Leasehold Interest
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease.
Liquidation Value
The most probable price that a specified interest in real property should bring under the following conditions:
1. 2.
3. 4.
5. 6.
7. 8.
Consummation of a sale within a short time period.
The property is subjected to market conditions prevailing as of the date of valuation.
Both the buyer and seller are acting prudently and knowledgeably.
The seller is under extreme compulsion to sell.
The buyer is typically motivated.
Both parties are acting in what they consider to be their best interests.
A normal marketing effort is not possible due to the brief exposure time.
Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto.
9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
This definition can also be modified to provide for valuation with specified financing terms.
Marketing Time
An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal.
Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 315
Menifee Mayor and City Council
November 6, 2024
Page
1410 of 1464
Addenda
Market Value
The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
buyer and seller are typically motivated;
both parties are well informed or well advised, and acting in what they consider their own best interests;
a reasonable time is allowed for exposure in the open market; payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. (Source: Code of Federal Regulations, Title 12, Chapter I, Part 34.42[g]; also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472) Prospective Opinion of Value
A value opinion effective as of a specified future date. The term does not define a type of value.
Instead, it identifies a value opinion as being effective at some specific future date. An opinion of value as of a prospective date is frequently sought in connection with projects that are proposed, under construction, or under conversion to a new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy.
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 316
Menifee Mayor and City Council
November 6, 2024
Page
1411 of 1464
Addenda
Addendum C
Preliminary Title Report
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 317
Menifee Mayor and City Council
November 6, 2024
Page
1412 of 1464
675 Placentia Avenue, Suite 225
Brea, CA 92821
Office Phone: (949)404-2500
Office Fax: (714)667-0338
Title Officer Email: [email protected]
Lennar Homes - Inland
4140 Temescal Canyon Road, Ste. 410
Corona, CA 92883
Your Ref:
Our Order No.:
Rockport Ranch
192002-001552
Version No. 1 - 8/15/2024
Attn: Beth Bruley Property Address: Tract 37131-1, Menifee, CA Preliminary Report Dated as of August 7, 2024 at 7:30 a.m..
IN RESPONSE TO THE ABOVE REFERENCED APPLICATION FOR A POLICY OF TITLE INSURANCE, Doma Title Insurance, Inc.
Hereby reports that it is prepared to issue, or cause to be issued, as of the date hereof, a Policy or Policies of Title Insurance describing the land and the estate or interest therein hereinafter set forth, insuring against loss which may be sustained by reason of any defect, lien or encumbrance not shown or referred to as an Exception below or not excluded from coverage pursuant to the printed Schedules, Conditions and Stipulations of said Policy forms.
The printed Exceptions and Exclusions from the coverage and limitations on covered risks of said Policy or Policies are set forth in Exhibit A attached. The Policy to be issued may contain an Arbitration Clause. When the amount of insurance is less than that set forth in the Arbitration Clause, all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the Parties. Limitations on covered risks applicable to the CLTA and ALTA Homeowner's Policies of Title Insurance which establish a deductible amount and a maximum dollar limit of liability for certain coverages are also set forth in Exhibit A.
Copies of the Policy forms should be read. They are available from the office which issued this report.
Please read the exceptions shown or referred to below and the exceptions and exclusions set forth in Exhibit A of this report carefully. The exceptions and exclusions are meant to provide you with notice of matters which are not covered under the terms of the title insurance policy and should be carefully considered.
It is important to note that this preliminary report is not a written representation as to the condition of title and may not list all liens, defects, and encumbrances affecting title to the land.
This report (and any supplements or amendments hereto) is issued solely for the purpose of facilitating the issuance of a policy of title insurance and no liability is assumed hereby. If it is desired that liability be assumed prior to the issuance of a policy of title insurance, a Binder or Commitment should be requested.
The form of Policy of title insurance contemplated by this report is:
ALTA Extended Owner's Policy
Please note that the America First Homeowner's Policy (CLTA/ ALTA Homeowner's Policy) can only be issued on transactions involving individuals as purchasers and residential 1-4 properties. Any indication that the America First Homeowner's Policy (CLTA/ ALTA Homeowner's Policy) will be issued in a transaction that does not meet these criteria is hereby revised to state that the policy contemplated is a Standard Coverage Policy.
Randy Dean, Title Officer
Prelim (CA/NV) Page 1 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 318
Menifee Mayor and City Council
November 6, 2024
Page
1413 of 1464
SCHEDULE A
The estate or interest in the land herein after described or referred to covered by this report is:
Fee Simple
1. 2. Title to said estate or interest at the date hereof is vested in:
Lennar Homes of California, LLC, a California limited liability company (as to Lots 63 through 67, 122, 166 through 180, 183, 210 through 232, and 291, 298 through 305, Lettered Lots A through E, I through L, P, R, Q, U, W, Y and Z) and AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership (as to the remainder of lots)
3. Real Property in the City of Menifee, County of Riverside, State of California, described as follows:
See attached Legal Description
Prelim (CA/NV) Page 2 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 319
Menifee Mayor and City Council
November 6, 2024
Page
1414 of 1464
LEGAL DESCRIPTION
Real Property in the City of Menifee, County of Riverside, State of California, described as follows:
LOTS 63 THROUGH 67, 82 THROUGH 85, INCLUSIVE, 102 THROUGH 105, INCLUSIVE, 162, 163, 165 THROUGH 183, 194 THROUGH 201, 210 THROUGH 233, 253 THROUGH 273, 289, 291, 298 THROUGH 305,
INCLUSIVE, LETTERED LOTS A THROUGH D, INCLUSIVE, H THROUGH L, P, Q, R, INCLUSIVE, U THROUGH W, INCLUSIVE, Y, Z AND CC, DD, INCLUSIVE, OF TRACT MAP NO. 37131-1, IN THE CITY OF MENIFFE, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE IN BOOK 489, PAGES 24 THROUGH 39, OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 364-190-004
Prelim (CA/NV) Page 3 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 320
Menifee Mayor and City Council
November 6, 2024
Page
1415 of 1464
SCHEDULE B
At the date hereof exceptions to coverage in addition to the printed exceptions and exclusions in the policy form designated on the face page of this report would be as follows:
1. 2.
Taxes and assessments. Report to follow. Please verify before closing.
Assessment liens, if applicable, collected with the general and special taxes, including but not limited to those disclosed by the reflection of the following on the tax roll:
Community Facilities District PERRIS UHS CFD 92-1.
3. 4.
5. The land lies within the boundaries of proposed community facilities District No. 2023-1 (Rockport Ranch), as disclosed by a map filed in in Book 90 Page 56 of maps of assessment and community facilities districts.
The land lies within the boundaries of proposed community facilities District No. 2017-1 (Maintenance Services), as disclosed by a map filed in in Book 90 Page 57 of maps of assessment and community facilities districts.
The lien of special tax assessed pursuant to Chapter 2.5 commencing with Section 53311 of the California Government Code for Community Facilities District No. 2017-1 (Maintenance Services) City of Menifee, as disclosed by Notice of Special Tax Lien recorded December 14, 2017 as Instrument No. 2017-0524512 of Official Records.
The terms and provisions contained in the document entitled "Amendment No. 16 to Notice of Special Tax Lien" recorded April 10, 2023 as Instrument No. 2023-0101089 of Official Records.
6. 7.
The land lies within the boundaries of proposed community facilities District No. 2023-1 (Rockport Ranch), as disclosed by a map filed in Book 91 Page 15 of maps of assessment and community facilities districts.
The lien of special tax assessed pursuant to Chapter 2.5 commencing with Section 53311 of the California Government Code for Community Facilities District No. 2023-1 (Rockport Ranch) of the City of Menifee, as disclosed by Notice of Special Tax Lien recorded June 15, 2023 as Instrument No. 2023-0172646 of Official Records.
8. 9.
The lien of supplemental taxes, if any, assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code.
An easement for pipelines and other equipment and incidental purposes in the document recorded August 20, 1958 in Book 2320, Page 458 of Official Records.
The location of the easement cannot be determined from record information.
10. 11.
The terms and provisions contained in the document entitled "Resolution" recorded December 30, 1980 as Instrument No. 243945 and 243946 both of Official Records.
The terms and provisions contained in the document entitled "School Facilities Mitigation Agreement Between Menifee Union District and Dr. R.J. and Ramza Hamra" recorded October 3, 1995 as Instrument No. 330409 of Official Records.
12. 13.
The terms and provisions contained in the document entitled "Resolution" recorded May 14, 1996 as Instrument No. 177691 of Official Records.
An easement for public use of the construction and maintenance of a water transmission pipeline extension in connection with the La Piedra Road Water Transmission Pipeline Extension, including temporary easements, and perpetual non-exclusive easements and right of way and for all necessary Prelim (CA/NV) Page 4 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 321
Menifee Mayor and City Council
November 6, 2024
Page
1416 of 1464
related uses and incidental purposes, recorded September 1, 2001 as Instrument No. 2001-449760 and August 14, 2002 as Instrument No. 2002-447568 both of Official Records.
In Favor of: Eastern Municipal Water District. a public agency of the State of California Affects: located within Lots R, T and DD, as shown on Tract Map 37131-1
14. The terms and provisions contained in the document entitled Memorandum of Option Agreement, executed by and between AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership and Lennar Homes of California, Inc., a California corporation, recorded December 29, 2021, as Instrument No. 2021-0763085 of Official Records.
15. 16.
Water rights, claims or title to water, whether or not shown by the Public Records.
The terms and provisions contained in the document entitled Temporary Construction Easement Agreement, executed by and between The Lakes Community Association, a California nonprofit mutual benefit corporation and Lennar Homes of California, LLC, recorded October 20, 2022, as Instrument No. 2022-0437015 of Official Records.
17. An easement for a nonexclusive easement to excavate for, lay, construct, reconstruct, relocate, reconfigure, use, inspect, maintain, operate, repair, replace, patrol, change the size of, add to. or remove from time to time, as Grantee deems necessary, one or more pipelines and conduits, together with devices for metering, measuring, regulating, cathodic protection, communications and other appurtenances and incidental purposes, recorded January 5, 2023 as Instrument No. 2023-0002774 of Official Records.
In Favor of: Southern California Gas Company, a California corporation, its successors and assigns Affects: shown on Tract Map 37131-1
18. 19.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Property described below is dedicated as an easement for public purposes: Lots "CC" (Old Newport Road) and "DD (Tres Lagos Drive), inclusive. The dedication is for street and public utility purposes.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
As a condition of dedication of Lots "CC" (Old Newport Road), and Lot "DD" (Tres Lagos Drive), the owners of Lots "I" "U", and "EE", abutting these highways and during such time will have no rights of access except the general easement of travel. Any change of alignment or width that results in the vacation thereof shall terminate this dedication as to the part vacated.
20. The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Property is dedicated as an easement for public purposes: abutters' rights of access along Old Newport Road and Tres Lagos Drive. The owners of Lots "CC" and "DD" abutting these highways and during such time will have no rights of access except the general easement of travel. Any change of alignment or width that results in the vacation thereof shall terminate this dedication as to the part vacated.
21. 22.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Dedicate to the City of Menifee an easement blanket in nature across Lots "U", "T", and "EE" for landscape and drainage purposes.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
We retain (Lots "A" through "D", and "R", inclusive) indicated as "Private Streets" (Lots "F" through "Q") indicated as "Private Access" as shown hereon for private use, for the sole benefit of ourselves, our successors, assignees, and lot owners within this Tract Map.
23. The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
We retain (Lots "V", "W", "Y" and "Z") indicated as "Private Common Areas" as shown hereon for private use, for the sole benefit of ourselves, our successors, assignees, and lot owners within this Tract Map.
Prelim (CA/NV) Page 5 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 322
Menifee Mayor and City Council
November 6, 2024
Page
1417 of 1464
24. The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Dedicated as an easement for public purposes: the private street and private access easements shown hereon. The dedication is for public utility purposes together with the right of ingress and egress for emergency vehicles within the "private street" and "private access" easements.
25. 26.
27. The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
We reserve the reciprocal access easement over a portion of Lot "Y" for utilities, ingress, egress and emergency access as shown hereon, for the benefit of ourselves, our successors and assignees.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Dedicate to the City of Menifee the reciprocal access easement shown hereon, for public utility purposes together with the right of ingress and egress for emergency vehicles access.
The following matters shown or disclosed by the filed or recorded map referred to in the legal description:
Environmental Constraint Note
Environmental constraints sheet affecting this Map is on file in the office of the City of Menifee Public Works and Engineering Department, in E.C.S. Book 100, Page 100.
28. Covenants, conditions, restrictions and easements in the document recorded March 28, 2023 as Instrument No. 2023-0087752 of Official Records, which provide that a violation thereof shall not defeat or render invalid the lien of any first mortgage or deed of trust made in good faith and for value, but deleting any covenant, condition, or restriction indicating a preference, limitation or discrimination based on race, color, religion, sex, sexual orientation, familial status, disability, handicap, national origin, genetic information, gender, gender identity, gender expression, source of income (as defined in California Government Code § 12955(p)) or ancestry, to the extent such covenants, conditions or restrictions violation 42 U.S.C. § 3604(c) or California Government Code § 12955. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 150 through 152, inclusive, and 161 through 165, inclusive, of Tract No. 37131-1 Document(s) declaring modifications thereof recorded July 20, 2023 as Instrument No. 2023-0210880 of Official Records.
Affects Lots 150 through 152, and 161 through 165
A declaration of annexation recorded September 12, 2023 as Instrument No. 2023-0269064 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 82 through 85, and 102 through 105
A declaration of annexation recorded September 12, 2023 as Instrument No. 2023-0269088 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Prelim (CA/NV) Page 6 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 323
Menifee Mayor and City Council
November 6, 2024
Page
1418 of 1464
Affects Lots 250 through 257, and Association Property: Lot "O" of the Map A declaration of annexation recorded October 3, 2023 as Instrument No. 2023-0292635 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 184 through 193; and
Association Property: Lots "T" and "EE"
A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298196 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 194 through 201
A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298600 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 242 through 249 and Association Property: Lot "N" of the Map A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298606 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 234 through 241 and Association Property: Lot "M" of the Map A declaration of annexation recorded October 11, 2023 as Instrument No. 2023-0299073 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 76 through 81, inclusive, 106 and 107
Prelim (CA/NV) Page 7 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 324
Menifee Mayor and City Council
November 6, 2024
Page
1419 of 1464
A declaration of annexation recorded October 11, 2023 as Instrument No. 2023-0299078 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 72 through 75, inclusive, and 108 through 111 A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302692 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 68 through 71, and 112
A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302697 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 202 through 209
A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302700 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 274 through 281 and Association Property: Lot "F" of the Map A declaration of annexation recorded January 23, 2024 as Instrument No. 2024-0020874 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 59 through 62
A declaration of annexation recorded January 23, 2024 as Instrument No. 2024-0020888 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or Prelim (CA/NV) Page 8 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 325
Menifee Mayor and City Council
November 6, 2024
Page
1420 of 1464
discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 282 through 289; and
Association Property: Lot "G" of the Map.
A declaration of annexation recorded March 8, 2024 as Instrument No. 2024-0065332 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 290 through 297; and
Association Property: Lot "H" of the Map.
A declaration of annexation recorded April 1, 2024 as Instrument No. 2024-0094138 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 298 through 305; and Association Property: Lot "I" of the Map.
A declaration of annexation recorded April 1, 2024 as Instrument No. 2024-0094219 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Association Property: Lot "W"
A declaration of annexation recorded April 1, 2024 as Instrument No. 2024-0094245 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Association Property: Lot "D"
Prelim (CA/NV) Page 9 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 326
Menifee Mayor and City Council
November 6, 2024
Page
1421 of 1464
A declaration of annexation recorded July 19, 2024 as Instrument No. 2024-0214948 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 210 through 217; and
Association Property: Lot "J" of the Map.
29. An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems (hereinafter referred to as "systems"), consisting of wires, underground conduits, cables, vaults, manholes, handholes, and including above-ground enclosures, markers and concrete pads and other appurtenant fixtures and equipment necessary or useful for distributing electrical energy and for transmitting intelligence, date and/or communications and incidental purposes, recorded May 11, 2023 as Instrument No. 2023-0135493 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: that portion of Lot "U" of Tract Map No. 37131-1, lying Northerly of a line parallel with and distant
52.00 feet Southerly, measured at right angles, from the centerline of Old Newport Road, 37.00 foot half-width, as shown on said Tract Map No. 37131-1
30. An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems (hereinafter referred to as "systems"), consisting of wires, underground conduits, cables, vaults, manholes, handholes, and including above-ground enclosures, markers and concrete pads and other appurtenant fixtures and equipment necessary or useful for distributing electrical energy and for transmitting intelligence, date and/or communications and incidental purposes, recorded May 23, 2023 as Instrument No. 2023-0147458 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: all streets, highways, pubic places, all of Lot Y, and within six feet of all front lot lines, also three feet on each side of all side lot lines of Lots 184 through 209, of Tract No. 37131-1
31. An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems (hereinafter referred to as "systems"), consisting of wires, underground conduits, cables, vaults, manholes, handholes, and including above-ground enclosures, markers and concrete pads and other appurtenant fixtures and equipment necessary or useful for distributing electrical energy and for transmitting intelligence, date and/or communications and incidental purposes, recorded May 23, 2023 as Instrument No. 2023-0147460 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: all streets, highways, public places, and all of Lots M, N, and O, of Tract No. 37131-1, together with various strips of land lying within Lots 234, 235, 236, 242, 243, 244, 255, 256 and 257 of said Tract No. 37131-1, as described therein
32. An easement for right of way to construct, use, maintain, alter, add to, enlarge, repair, replace, inspect, and/or remove, at any time and from time to time, electric lines, consisting of poles and towers made of various materials, "H" frame structures, guy wires and anchors, crossarms, wires and other fixtures and appliances and communication circuits with necessary appurtenances, both overhead and underground, for conveying electric energy to be used for light, heat, power, telephone and/or purposes and incidental purposes, recorded June 15, 2023 as Instrument No. 2023-0171570 of Official Records.
Prelim (CA/NV) Page 10 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 327
Menifee Mayor and City Council
November 6, 2024
Page
1422 of 1464
In Favor of: Southern California Edison Company, a corporation Affects: as described therein
33. An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems (hereinafter referred to as "systems"), consisting of wires, underground conduits, cables, vaults, manholes, handholes, and including above-ground enclosures, markers and concrete pads and other appurtenant fixtures and equipment necessary or useful for distributing electrical energy and for transmitting intelligence, date and/or communications and incidental purposes, recorded July 3, 2023 as Instrument No. 2023-0193381 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: all streets, highways, public places, and all of Lots P and Q, of Tract No. 37131-1, together with various strips of land lying within Lots 261, 262, 263, 269, 270, and 271 of said Tract No. 37131-1 as described therein
34. 35.
36. An easement for an easement and right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded August 29, 2023 as Instrument No. 2023-0255681 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects all streets, highways, public places, and all of Lots J, K, and L of Tract 3131-1, together with various strips of land lying within Lots 213 through 217, Lots 221 through 225, and Lots 231 through 233, of said Tract No. 37131-1, as described therein
An easement for an easement and right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded August 29, 2023 as Instrument No. 2023-0255683 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects all streets, highways, public places, and all of Lots F, G, H, AND I of Tract 3131-1, together with various strips of land lying within Lots 274 through 276, Lots 282 through 284, Lots 290 through 292, and Lots 298 through 300, of said Tract No. 37131-1, as described therein An easement for an easement and right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded August 29, 2023 as Instrument No. 2023-0255684 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects Two strips of land lying within Phase 2 Remainder Parcel as shown on Tract Map No. 37131-1, described as follows:
Strip #1 - the Easterly 59.00 feet of said Phase 2 Remainder Parcel; Strip #2 - the Southerly 36.00 feet of the Easterly 106.00 feet of said Phase 2 Remainder Parcel; Excepting therefrom that portion included within Strip #1 described hereinabove.
Prelim (CA/NV) Page 11 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 328
Menifee Mayor and City Council
November 6, 2024
Page
1423 of 1464
37. Matters in a document entitled "Declaration of Solar Energy Covenants, Conditions and Restrictions for Rockport Ranch (With Battery Storage System)", executed by and between Lennar Homes of California, LLC, a California limited liability company, recorded September 1, 2023 as Instrument No. 2023-0260415 of Official Records, including but not limited to covenants, conditions, restrictions, easements, assessments, liens and charges.
Affects Lots 150 through 152, and 161 through 165, of Tract Map No. 37131-1 A declaration of annexation recorded September 12, 2023 as Instrument No. 2023-0269065 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 82 through 85, and 102 through 105
A declaration of annexation recorded September 12, 2023 as Instrument No. 2023-0269089 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 250 through 257, inclusive, and Lettered Lot "O" A declaration of annexation recorded September 15, 2023 as Instrument No. 2023-0273659 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 184 through 193, inclusive, and Lettered Lots "T" and "EE" A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298197 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 194 through 201
A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298601 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, Prelim (CA/NV) Page 12 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 329
Menifee Mayor and City Council
November 6, 2024
Page
1424 of 1464
to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 242 through 249, inclusive, and Lettered Lot "N" A declaration of annexation recorded October 10, 2023 as Instrument No. 2023-0298607 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 234 through 241, inclusive, and Lettered Lot "M" A declaration of annexation recorded October 11, 2023 as Instrument No. 2023-0299079 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 72 through 75, inclusive, and 108 through 111 A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302609 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 76 through 81, inclusive, 106 and 107
A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302693 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 68 through 71, and 112
A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302698 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Prelim (CA/NV) Page 13 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 330
Menifee Mayor and City Council
November 6, 2024
Page
1425 of 1464
Affects Lots 202 through 209
A declaration of annexation recorded October 13, 2023 as Instrument No. 2023-0302701 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 274 through 281, and Lettered Lot "F"
A declaration of annexation recorded January 23, 2024 as Instrument No. 2024-0020875 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 59 through 62
A declaration of annexation recorded January 23, 2024 as Instrument No. 2024-0020889 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 282 through 289, and Lettered Lot "G"
A declaration of annexation recorded March 8, 2024 as Instrument No. 2024-0065333 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 290 through 297, and Lettered Lot "H"
A declaration of annexation recorded April 1, 2024 as Instrument No. 2024-0094139 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 296 through 305, inclusive, and Lettered Lot "I" Prelim (CA/NV) Page 14 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 331
Menifee Mayor and City Council
November 6, 2024
Page
1426 of 1464
A declaration of annexation recorded April 1, 2024 as Instrument No. 2024-0094220 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lot "W"
A declaration of annexation recorded July 19, 2024 as Instrument No. 2024-0214949 of Official Records but deleting any covenant, condition, or restriction, if any, indicating a preference, limitation, or discrimination based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, handicap, veteran or military status, genetic information, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, to the extent that such covenants, conditions or restrictions violate applicable state or federal laws.
Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.
Affects Lots 210 through 217, and Lettered Lot "J"
38. The terms, provisions and conditions contained in a Notice of Builder's Election of Handling of Construction Claims pursuant to California Civil Code Section 895 et seq.
Executed by: Lennar Homes of California, LLC, a California limited liability company (as successor-in-interest by conversion to Lennar Homes of California, Inc.
Recorded: September 12, 2023 as Instrument No. 2023-0269033 of Official Records Said notice provides that violation thereof will not invalidate or impair the rights of any mortgagor or beneficiary.
Reference is made to said document for full particulars.
Affects Lot 63 through 85, inclusive, 102, through 112, inclusive, 150 through 152, inclusive, and 161 through 305 and Lettered Lots "A" through "D", inclusive "F" through "R", inclusive, "T" through "*U", inclusive, "V", "W", "Y", and "Z"
39. 40.
41. An easement for solar energy equipment and incidental purposes, recorded September 12, 2023 as Instrument No. 2023-0269034 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lot 150 through 152, and 161 through 165
An easement for solar energy equipment and incidental purposes, recorded September 12, 2023 as Instrument No. 2023-0269066 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 82 through 85, and 102 through 105
An easement for solar energy equipment and incidental purposes, recorded September 12, 2023 as Instrument No. 2023-0269090 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 250 through 257
Prelim (CA/NV) Page 15 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 332
Menifee Mayor and City Council
November 6, 2024
Page
1427 of 1464
42. The terms and provisions contained in the document entitled Private Street Easement Deed, executed by and between AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership and Rockport Ranch Community Association, a California nonprofit mutual benefit corporation, recorded September 13, 2023, as Instrument No. 2023-0270165 of Official Records.
Affects Parcel 1: A non-exclusive temporary easement for the benefit of Grantee and its Members (as defined in the Declaration) for pedestrian and vehicular access on, over through and across the private streets located within Lots A through D, inclusive, and R of Tract Map No. 37131-1; and Parcel 2: A non-exclusive temporary easement for access, ingress and egress on, over, through and across the Private Streets for purposes of maintenance, repair and replacement of the Private Streets as authorized under the terms and provisions of that certain unrecorded Maintenance and Agreement entered into between Lennar Homes of California, LLC, a California limited liability company and Grantee on September 5, 2023 as such private street maintenance agreement may be amended from time to time ("Maintenance and Reserve Agreement").
43. 44.
45. 46.
47. 48.
An easement for solar energy equipment and incidental purposes, recorded September 15, 2023 as Instrument No. 2023-0273660 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 184 through 193
An easement for solar energy equipment and incidental purposes, recorded October 10, 2023 as Instrument No. 2023-0298198 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 194 through 201
An easement for solar energy equipment and incidental purposes, recorded October 10, 2023 as Instrument No. 2023-0298602 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 242 through 249
An easement for solar energy equipment and incidental purposes, recorded October 10, 2023 as Instrument No. 2023-0298608 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 234 through 241
An easement for solar energy equipment and incidental purposes, recorded October 11, 2023 as Instrument No. 2023-0299075 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 76 through 81, inclusive, 106 and 107
An easement for solar energy equipment and incidental purposes, recorded October 11, 2023 as Instrument No. 2023-0299080 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 72 through 75, inclusive, and 108 through 111 Prelim (CA/NV) Page 16 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 333
Menifee Mayor and City Council
November 6, 2024
Page
1428 of 1464
49. 50.
51. 52.
An easement for solar energy equipment and incidental purposes, recorded October 13, 2023 as Instrument No. 2023-0302694 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 68 through 71, and 112
An easement for solar energy equipment and incidental purposes, recorded October 13, 2023 as Instrument No. 2023-0302699 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 202 through 209
An easement for solar energy equipment and incidental purposes, recorded October 13, 2023 as Instrument No. 2023-0302702 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 274 through 281
An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded October 30, 2023 as Instrument No. 2023-0320452 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: all streets, highways, public places, all of Lots T, Z and within six feet of all front lot lines, also three feet on each side of all side lot lines of Lot 63 through 85, and Lots 102 through 112, of Tract No. 37131-1
53. 54.
55. An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded October 30, 2023 as Instrument No. 2023-0320453 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects: all streets, highways, public places, and within six feet of all front lot lines, also three feet on each side of all side lot lines of Lots 161 through 183 and Lots 150 through 152, of Tract No. 37131-1 An easement for right of way to construct, use, maintain, operate, alter, add to, repair, replace, reconstruct, inspect and remove at any time and from time to time underground electrical supply systems and communication systems and incidental purposes, recorded October 30, 2023 as Instrument No. 2023-0320454 of Official Records.
In Favor of: Southern California Edison Company, a corporation Affects all of Lot R as shown on Tract No. 37131-1
An easement for solar energy equipment and incidental purposes, recorded January 23, 2024 as Instrument No. 2024-0020890 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 282 through 289
Prelim (CA/NV) Page 17 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 334
Menifee Mayor and City Council
November 6, 2024
Page
1429 of 1464
56. 57.
58. 59.
An easement for solar energy equipment and incidental purposes, recorded March 8, 2024 as Instrument No. 2024-0065334 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 290 through 297
An easement for solar energy equipment and incidental purposes, recorded April 1, 2024 as Instrument No. 2024-0094140 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 298 through 305
An easement for solar energy equipment and incidental purposes, recorded July 19, 2024 as Instrument No. 2024-0214950 of Official Records.
In Favor of: Sunnova Energy Corporation, a Delaware corporation Affects Lots 210 through 217
No known matters otherwise appropriate to be shown have been deleted from this report, which is not a policy of Title insurance but a report to facilitate the issuance of a policy of Title insurance.
For purposes of policy issuance, items (None) may be eliminated on the basis of an indemnity agreement or other agreement satisfactory to the Company as insurer. *********************END OF REPORT********************* Prelim (CA/NV) Page 18 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 335
Menifee Mayor and City Council
November 6, 2024
Page
1430 of 1464
__________________________________________________________________________________________ ********************NOTES*********************
NOTICE OF RECORDING PROCEDURE
Pursuant to Cal. Revenue & Tax Code §480.3, all Deeds and other Documents that reflect a change in ownership must be accompanied by a Preliminary Change of Ownership Report to be completed by the transferee. If this special report is not presented at the time of recording, an additional recording fee of $20.00, as required by law, will be charged. Preliminary Change in Ownership forms, instructions on how to complete them, and a nonexclusive list of documents that are affected by this change, are available from the County Recorder's Office or the Office of the County Assessor.
Effective January 1, 2018, Cal. Government Code §27388.1 imposes an additional fee of $75.00 to be paid at the time of recording for every real estate instrument, paper, or notice required or permitted by law to record, except those expressly exempted from payment.
GOOD FUNDS LAW
Under Section 12413.1 of the California Insurance Code, Lennar Title, Inc. may only make funds available for disbursement in accordance with the following rules:
Same day availability. Disbursement on the date of deposit is allowed only when funds are deposited to Lennar Title, Inc. by Cash or Electronic Transfer (Wire). Cash will be accepted only under special circumstances and upon approval by management.
Next business day availability. If funds are deposited to Lennar Title, Inc. by cashier's checks, certified checks or teller's checks, disbursement may be on the next business day following deposit. A “teller's check” is one drawn by an insured financial institution against another insured financial institution (e.g., a savings and loan funding with a check drawn against a FDIC insured bank).
Second business day availability. If the deposit is made by checks other than those described in paragraphs 1 and 2 above, disbursement may occur on the day when funds must be made available to depositors under Federal Reserve Regulation CC. In most cases, these checks will be available on the second business day following deposit. (For further details, consult California Insurance Code Section 12413, et seq. and Regulation CC).
These are the minimum periods before funds will be made available. Lennar Title, Inc. is not obligated to disburse funds at the expiration of the time periods above, and expressly reserves the right to require additional time before disbursing on deposited funds. Close of escrow and final disbursement will not be made based on deposits in the form of personal checks, corporate checks, credit union checks, money market checks, travelers checks and official checks until confirmation of final clearance of the funds.
Lennar Title, Inc. will not be responsible for accruals of interest or other charges resulting from compliance with the disbursement restrictions imposed by state law.
Lennar Title, Inc. charges for recording the transaction documents include charges for services performed by Lennar Title, Inc., in addition to an estimate of payments to be made to governmental agencies.
Note: The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than the certain dollar amount set forth in any applicable arbitration clause, all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. If you desire to review the terms of the policy, including any arbitration clause that may be included, contact the office that issued this Commitment or Report to obtain a sample of the policy jacket for the policy that is to be issued in connection with your transaction.
The map attached, if any, may or may not be a survey of the land depicted hereon. Lennar Title, Inc.
Prelim (CA/NV) Page 19 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 336
Menifee Mayor and City Council
November 6, 2024
Page
1431 of 1464
expressly disclaims any liability for loss or damage which may result from reliance on this map except to the extent coverage for such loss or damage is expressly provided by the terms and provisions of the title insurance policy, if any, to which this map is attached.
Additional Notes:
Prelim (CA/NV) Page 20 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 337
Menifee Mayor and City Council
November 6, 2024
Page
1432 of 1464
AFFILIATED BUSINESS ARRANGEMENT DISCLOSURE
Referring Party: Lennar Title, Inc., CalAtlantic Title, Inc., Lennar Title, LLC, or Lennar Closing Services, Inc., as applicable (“Lennar Title”)
This is to give notice that Lennar Title has a business relationship with North American Title Insurance Company (“NATIC”) and Lennar Insurance Agency, LLC (“LIA”) because Lennar Title’s parent, Lennar Title Group, LLC (“LTG”), has an indirect 20% ownership interest in NATIC’s parent company and an 80% ownership interest in LIA. Because of this relationship, this referral of services may provide Lennar Title a financial or other benefit.
Set forth below are the estimated charges or range of charges for the settlement services provided by NATIC and LIA. You are NOT required to use NATIC or LIA as a condition for closing your transaction and obtaining insurance.
THERE ARE FREQUENTLY OTHER SETTLEMENT SERVICE PROVIDERS AVAILABLE WITH SIMILAR SERVICES. YOU ARE FREE TO SHOP AROUND TO DETERMINE THAT YOU ARE RECEIVING THE BEST SERVICES AND THE BEST RATE FOR THESE SERVICES.
Title Insurance Fees
Lennar Title provides closing services and title insurance through numerous title insurance underwriters, one of which is NATIC. If NATIC is selected as the title insurer, the following fees apply:
10% - 40% of costs for lender’s and/or owner’s title insurance, as applicable, depending on the property state, and as shown on the Loan Estimate and/or Closing Disclosure provided by your lender.
Contact your local CAT representative for a more detailed title insurance quote based on your specific transaction.
Insurance
Lennar Insurance Agency, LLC (LIA) is an insurance agent that provides, among other products, homeowner’s/hazard and flood insurance. Set forth below are the estimated range of charges by LIA for the settlement services listed.
Description of Settlement Service
Homeowner’s/Hazard Insurance
Flood Insurance
Range of Charges - Annual Premium
0.2% - 2.5% of purchase price amount
0.1% - 0.5% of purchase price amount
NOTE: The above premium ranges for homeowner’s/hazard and flood insurance are from LIA. If enhancements to the standard policy such as increased limits, scheduled articles, and/or earthquake coverage are required, the premium may increase. Actual quote and acceptance by LIA is subject to LIA’s application of their underwriting guidelines, including but not limited to verification of your credit score and previous loss history. Of course, the cost of your insurance may vary due to many factors including, without limitation, the size, location and cost of your home.
Prelim (CA/NV) Page 21 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 338
Menifee Mayor and City Council
November 6, 2024
Page
1433 of 1464
ACKNOWLEDGMENT
I/we have read this disclosure form, and understand that Lennar Title is referring me/us to purchase the above-described settlement service and may receive a financial or other benefit as the result of this referral.
Buyer/Borrower: Seller:
Date: Date:
Prelim (CA/NV) Page 22 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 339
Menifee Mayor and City Council
November 6, 2024
Page
1434 of 1464
LENNAR TITLE, INC.
675 Placentia Avenue, Suite 225
Brea, CA 92821
Office Phone: (949)404-2500
Office Fax: (714)667-0338
Attention:
Your Ref:
Our Order No.: 192002-001552
LENDERS SUPPLEMENTAL REPORT
Dated as of August 7, 2024 at 07:30 AM.
Title Officer: Randy Dean
The above numbered report (including any supplements or amendments thereto) is hereby modified and/or supplemented in order to reflect the following additional items relating to the issuance of an American Land Title Association loan form policy of Title Insurance:
Our ALTA Loan Policy, when issued, will contain ALTA 9-06, ALTA 8.2-08 and ALTA 22-06 There is located on said land a Commercial
Known as: Tract 37131-1, Menifee, CA
City of Menifee
County of RiversideState of California.
NOTE: According to the public records, there have been no Deeds conveying the land described herein within a period of 24 months prior to the date of this Report, except as follows:
A document recorded December 29, 2021 as Instrument No. 2021-0763084 of Official Records.
From: Lennar Homes of California, Inc., a California corporation To: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership A document recorded April 17, 2023 as Instrument No. 2023-0108589 of Official Records.
From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 65 through 67, 72 through 85, 102 through 111, 150 through 152, 161 through 165, 174, 175, 177, 178, 181, 182, 184 through 188, 242 through 248, 250 through 257, 266, 267 and 272 A document recorded June 27, 2023 as Instrument No. 2023-0182824 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 68 through 71, 112, 189 through 196, 234 through 240 and 249 A document recorded August 15, 2023 as Instrument No. 2023-0239733 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Prelim (CA/NV) Page 23 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 340
Menifee Mayor and City Council
November 6, 2024
Page
1435 of 1464
Affects Lots 197 through 204, 241 and 274 through 280
A document recorded October 10, 2023 as Instrument No. 2023-0298583 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 166, 167, 168, 205, 206, 207, 208, 209, 281, 282, 283, 284, 285, 286, 287 and 288 A document recorded October 10, 2023 as Instrument No. 2023-0298584 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lettered Lots A through Q, T and W
A document recorded November 9, 2023 as Instrument No. 2023-0339473 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lettered Lots U and EE
A document recorded November 21, 2023 as Instrument No. 2023-0349867 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot "O"
A document recorded December 12, 2023 as Instrument No. 2023-0368539 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot "N"
A document recorded December 15, 2023 as Instrument No. 2023-0372337 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 63, 64 and 289 through 296
A document recorded January 12, 2024 as Instrument No. 2024-0012258 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lots "T" and "EE"
A document recorded February 14, 2024 as Instrument No. 2024-0041187 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 169 through 173, 176, 179, 180, 183 and 297 through 304 Prelim (CA/NV) Page 24 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 341
Menifee Mayor and City Council
November 6, 2024
Page
1436 of 1464
A document recorded February 27, 2024 Instrument No. 2024-0053194 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot M
A document recorded April 15, 2024 as Instrument No. 2024-0108770 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 210, 211, 212, 213, 214, 215, 216 and 305
A document recorded April 15, 2024 as Instrument No. 2024-0108771 of Official Records From: AG EHC II (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lettered Lots R, Y and Z
A document recorded April 17, 2024 as Instrument No. 2024-0112040 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot F
A document recorded June 10, 2024 as Instrument No. 2024-0167213 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot G
A document recorded June 14, 2024 as Instrument No. 2024-0173461 of Official Records From: AG EHC (LEN) CA 1, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Affects Lots 217, 218, 219, 220, 221, 222, 223 and 224
A document recorded July 24, 2024 as Instrument No. 2024-0219985 of Official Records From: Lennar Homes of California, LLC, a California limited liability company To: Rockport Ranch Community Association, a California non-profit mutual benefit corporation Affects Lot "H"
A document recorded August 14, 2024 as Instrument No. 2024-0243688 of Official Records From: AG EHC II (LEN) CA I, L.P., a Delaware limited partnership To: Lennar Homes of California, LLC, a California limited liability company Prelim (CA/NV) Page 25 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 342
Menifee Mayor and City Council
November 6, 2024
Page
1437 of 1464
Prelim (CA/NV) Page 26 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 343
Menifee Mayor and City Council
November 6, 2024
Page
1438 of 1464
Prelim (CA/NV) Page 27 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 344
Menifee Mayor and City Council
November 6, 2024
Page
1439 of 1464
CLTA Preliminary Report Form - Exhibit A (Rev. 05-06-16) CLTA STANDARD COVERAGE POLICY - 1990
EXCLUSIONS FROM COVERAGE
The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses which arise by reason of:
60. (a) Any law, ordinance or governmental regulation (including but not limited to building or zoning laws, ordinances, or regulations) restricting, regulating, prohibiting or relating (i) the occupancy, use, or enjoyment of the land; (ii) the character, dimensions or location of any improvement now or hereafter erected on the land; (iii) a separation in ownership or a change in the dimensions or area of the land or any parcel of which the land is or was a part; or (iv) environmental protection, or the effect of any violation of these laws, ordinances or governmental regulations, except to the extent that a notice of the enforcement thereof or a notice of a defect, lien, or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. (b) Any governmental police power not excluded by (a) above, except to the extent that a notice of the exercise thereof or notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy.
61. 62.
Rights of eminent domain unless notice of the exercise thereof has been recorded in the public records at Date of Policy, but not excluding from coverage any taking which has occurred prior to Date of Policy which would be binding on the rights of a purchaser for value without knowledge.
Defects, liens, encumbrances, adverse claims or other matters:
(a) whether or not recorded in the public records at Date of Policy, but created, suffered, assumed or agreed to by the insured claimant; (b) not known to the Company, not recorded in the public records at Date of Policy, but known to the insured claimant and not disclosed in writing to the Company by the insured claimant prior to the date the insured claimant became an insured under this policy; (c) resulting in no loss or damage to the insured claimant; (d) attaching or created subsequent to Date of Policy; or (e) resulting in loss or damage which would not have been sustained if the insured claimant had paid value for the insured mortgage or for the estate
or interest insured by this policy.
63. Unenforceability of the lien of the insured mortgage because of the inability or failure of the insured at Date of Policy, or the inability or failure of any subsequent owner of the indebtedness, to comply with the applicable doing business laws of the state in which the land is situated.
64. 65.
Invalidity or unenforceability of the lien of the insured mortgage, or claim thereof, which arises out of the transaction evidenced by the insured mortgage and is based upon usury or any consumer credit protection or truth in lending law.
Any claim, which arises out of the transaction vesting in the insured the estate of interest insured by this policy or the transaction creating the interest of the insured lender, by reason of the operation of federal bankruptcy, state insolvency or similar creditors' rights laws.
EXCEPTIONS FROM COVERAGE - SCHEDULE B, PART I
This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) which arise by reason of:
1. Taxes or assessments which are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the public records.
Proceedings by a public agency which may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the public records.
2. Any facts, rights, interests, or claims which are not shown by the public records but which could be ascertained by an inspection of the land or which may be asserted by persons in possession thereof.
3. Easements, liens or encumbrances, or claims thereof, not shown by the public records.
4. Discrepancies, conflicts in boundary lines, shortage in area, encroachments, or any other facts which a correct survey would disclose, and which are not shown by the public records.
5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b) or (c) are shown by the public records.
6. Any lien or right to a lien for services, labor or material not shown by the public records.
CLTA/ALTA HOMEOWNER'S POLICY OF TITLE INSURANCE (12-02-13)
EXCLUSIONS
In addition to the Exceptions in Schedule B, You are not insured against loss, costs, attorneys' fees, and expenses resulting from:
1. Governmental police power, and the existence or violation of those portions of any law or government regulation concerning:
a. building;
b. zoning;
c. land use;
d. improvements on the Land;
e. land division; and
f. environmental protection.
This Exclusion does not limit the coverage described in Covered Risk 8.a., 14, 15, 16, 18, 19, 20, 23 or 27.
2. The failure of Your existing structures, or any part of them, to be constructed in accordance with applicable building codes. This Exclusion does not limit the coverage described in Covered Risk 14 or 15.
3. The right to take the Land by condemning it. This Exclusion does not limit the coverage described in Covered Risk 17.
4. Risks:
a. that are created, allowed, or agreed to by You, whether or not they are recorded in the Public Records; b. that are Known to You at the Policy Date, but not to Us, unless they are recorded in the Public Records at the Policy Date; c. that result in no loss to You; or
d. that first occur after the Policy Date - this does not limit the coverage described in Covered Risk 7, 8.e., 25, 26, 27 or 28.
5. Failure to pay value for Your Title.
Prelim (CA/NV) Page 28 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 345
Menifee Mayor and City Council
November 6, 2024
Page
1440 of 1464
6. Lack of a right:
a. to any land outside the area specifically described and referred to in paragraph 3 of Schedule A; and b. in streets, alleys, or waterways that touch the Land.
This Exclusion does not limit the coverage described in Covered Risk 11 or 21.
7. The transfer of the Title to You is invalid as a preferential transfer or as a fraudulent transfer or conveyance under federal bankruptcy, state insolvency, or similar creditors' rights laws.
8. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence.
9. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances.
LIMITATIONS ON COVERED RISKS
Your insurance for the following Covered Risks is limited on the Owner's Coverage Statement as follows:
For Covered Risk 16, 18, 19, and 21 Your Deductible Amount and Our Maximum Dollar Limit of Liability shown in Schedule A.
The deductible amounts and maximum dollar limits shown on Schedule A are as follows:
Your Deductible Amount Our Maximum Dollar
Limit of Liability
$10,000Covered Risk 16:
Covered Risk 18:
Covered Risk 19:
Covered Risk 21:
1% of Policy Amount Shown in Schedule A or $2,500
(whichever is less)
1% of Policy Amount Shown in Schedule A or $5,000
(whichever is less)
$25,000
$25,000
$5,000
1% of Policy Amount Shown in Schedule A or $5,000
(whichever is less)
1% of Policy Amount Shown in Schedule A or $2,500
(whichever is less)
2006 ALTA LOAN POLICY (06-17-06)
EXCLUSIONS FROM COVERAGE
The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys' fees, or expenses that arise by reason of:
1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to
(i) the occupancy, use, or enjoyment of the Land;
(ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or
(iv) environmental protection;
or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5.
(b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6.
2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.
3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 13, or 14);
or
(e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured Mortgage.
4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing-business laws of the state where the Land is situated.
5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury or any consumer credit protection or truth-in-lending law.
6. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction creating the lien of the Insured Mortgage, is
(a) a fraudulent conveyance or fraudulent transfer, or
(b) a preferential transfer for any reason not stated in Covered Risk 13(b) of this policy.
7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the Insured Mortgage in the Public Records. This Exclusion does not modify or limit the coverage provided under Covered Risk 11(b).
The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage:
EXCEPTIONS FROM COVERAGE
[Except as provided in Schedule B - Part II,[ t[or T]his policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by reason of:
Prelim (CA/NV) Page 29 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 346
Menifee Mayor and City Council
November 6, 2024
Page
1441 of 1464
[PART I
[The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage:
1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records.
2. Any facts, rights, interests, or claims that are not shown by the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land.
3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records.
4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and not shown by the Public Records.
5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records.
6. Any lien or right to a lien for services, labor or material not shown by the Public Records. ]
PART II
In addition to the matters set forth in Part I of this Schedule, the Title is subject to the following matters, and the Company insures against loss or damage sustained in the event that they are not subordinate to the lien of the Insured Mortgage:] 2006 ALTA OWNER'S POLICY (06-17-06)
EXCLUSIONS FROM COVERAGE
The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys' fees, or expenses that arise by reason of:
1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to
(i) the occupancy, use, or enjoyment of the Land;
(ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or
(iv) environmental protection;
or the effect of any violation of these laws, ordinances, or governmental regulations. This exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5.
(b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6.
1. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.
2. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 9 and 10); or
(e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title.
3. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction vesting the Title as shown in Schedule A, is
(a) a fraudulent conveyance or fraudulent transfer; or
(b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy.
4. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.
The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage:
EXCEPTIONS FROM COVERAGE
This policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by reason of:
[The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage:
1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records.
2. Any facts, rights, interests, or claims that are not shown in the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land.
3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records.
4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and that are not shown by the Public Records.
5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records.
6. Any lien or right to a lien for services, labor or material not shown by the Public Records.
7. [Variable exceptions such as taxes, easements, CC&R's, etc. shown here.] Prelim (CA/NV) Page 30 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 347
Menifee Mayor and City Council
November 6, 2024
Page
1442 of 1464
ALTA EXPANDED COVERAGE RESIDENTIAL LOAN POLICY - ASSESSMENTS PRIORITY (04-02-15)
EXCLUSIONS FROM COVERAGE
The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses which arise by reason of:
1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or
(iv) environmental protection;
or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5, 6, 13(c), 13(d), 14 or 16. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 5, 6, 13(c), 13(d), 14 or 16.
2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.
3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 16, 17, 18, 19, 20, 21, 22, 23, 24, 27 or 28); or
(e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured Mortgage.
4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing-business laws of the state where the Land is situated.
5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury, or any consumer credit protection or truth-in-lending law. This Exclusion does not modify or limit the coverage provided in Covered Risk 26.
6. Any claim of invalidity, unenforceability or lack of priority of the lien of the Insured Mortgage as to Advances or modifications made after the Insured has Knowledge that the vestee shown in Schedule A is no longer the owner of the estate or interest covered by this policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11.
7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching subsequent to Date of Policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11(b) or 25.
8. The failure of the residential structure, or any portion of it, to have been constructed before, on or after Date of Policy in accordance with applicable building codes. This Exclusion does not modify or limit the coverage provided in Covered Risk 5 or 6.
9. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the transaction creating the lien of the Insured Mortgage, is
(a) a fraudulent conveyance or fraudulent transfer, or
(b) a preferential transfer for any reason not stated in Covered Risk 27(b) of this policy.
10. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence.
11. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances.
Prelim (CA/NV) Page 31 192002-001552
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 348
Menifee Mayor and City Council
November 6, 2024
Page
1443 of 1464
Addenda
Addendum D
Comparable Data
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 349
Menifee Mayor and City Council
November 6, 2024
Page
1444 of 1464
Addenda
Land Sales - North Shore at Rockport Ranch
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 350
Menifee Mayor and City Council
November 6, 2024
Page
1445 of 1464
Land Sale Profile Sale No. 1
Location & Property Identification
Property Name:
Sub-Property Type:
Address:
ES Leon Rd., SO Domenigoni
Pkwy.
Residential, Single Family
Development Land
ES Leon Rd., SO Domenigoni
Pkwy.
City/State/Zip:
County:
Winchester, CA 92596
Riverside
Market Orientation:
IRR Event ID:
Suburban
3204058
Expenditures Description:
Other Adjustment:
Lot finishing costs
$2,000Sale Information
Adjustment Comments: No district was in place
but a bond is
anticipated for the
project.
Sale Price:
Effective Sale Price:
Sale Date:
$21,000,000
$21,000,000
01/30/2024
In-Contract
$247,642
$5.69
$2,916.67
$115,385 /Unit
GM Gabrych Family LP /
Genus LP / Empire
Communities
N/Av.
Fee Simple
Cash to seller
Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
Improvement and Site Data
Legal/Tax/Parcel ID: 461-410, 461-411, 461-412,
461-430, 461-431, 461-432,
461-420, 461-421, 461-440,
461-441, & 461-190-087
Acres(Gross):
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
84.80 3,693,888
7,200
Grantee/Buyer:
Property Rights:
Financing: 182
SP
Specific Plan
Public Records
Conditions of Sale: Arm's-length
N/Av.
Noah Kauffman, MAI, R/W-AC
Zoning Desc.:
Source of Land Info.:Recording No.:
Verified By:
CommentsVerification Date:
Verification Type:
02/22/2024
Confirmed-Seller Broker This is the pending sale of 182 final mapped lots on 84.8 total acres. The lots will be delivered in blue-top condition.
Additional estimated costs for a finished lot total $141,209 per lot. A bond district had not yet been created for the property but was anticipated for the project. Given surrounding
projects also utilize bond financing, it is
Sale Analysis
Expenditures After Purchase: $141,209
ES Leon Rd., SO Domenigoni Pkwy.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 351
Menifee Mayor and City Council
November 6, 2024
Page
1446 of 1464
Land Sale Profile Sale No. 1
Comments (Cont'd)
estimate the property would have an estimated special tax of $2,000 per lot.
ES Leon Rd., SO Domenigoni Pkwy.
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 352
Menifee Mayor and City Council
November 6, 2024
Page
1447 of 1464
Land Sale Profile Sale No. 2
Location & Property Identification
Property Name: Stratford Place II - East
Sub-Property Type: Residential, Single Family
Development Land
Address: Evans Rd.
City/State/Zip:
County:
Perris, CA 92571
Riverside
Market Orientation:
IRR Event ID:
Suburban
3269038
Sale Information Improvement and Site Data
Sale Price:
Effective Sale Price:
Sale Date:
$13,186,466
$13,186,466
10/01/2023
Closed
$13,186,466
$302.72
$2,197.74
$123,238 /Unit
Stratford Ranch Associates,
LLC
Legal/Tax/Parcel ID:
Acres(Gross):
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
302-362-012
1.00 43,560
6,000Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
107
R-6,000
Residential
Other
Zoning Desc.:
Source of Land Info.:
Comments
Grantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
Pulte Homes
Real estate only
Fee Simple
100.00
Cash to seller
This is a sale 107 unimproved lots with a typical lot size of 6,000 square feet. The finished lot price is estimated at $225,000 per lot. A building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing.
However, given the surrounding projects also utilize bond financing, it is estimated the property would have an
estimated special tax of $3,000 per lot.
Conditions of Sale: Arm's-length
Deed
Secondary Verification
Document Type:
Verification Type:
Sale Analysis
Expenditures After Purchase: $104,762
Expenditures Description: Site development and
permits and fees
Other Adjustment: $3,000
Adjustment Comments: Bond encumbrance
Stratford Place II - East
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 353
Menifee Mayor and City Council
November 6, 2024
Page
1448 of 1464
Land Sale Profile Sale No. 3
Location & Property Identification
Property Name: Green Valley Ranch PA 12
Sub-Property Type: Residential, Single Family
Development Land
Address: Green Valley Pky.
Perris, CA 92585
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3269087
Adjustment Comments: Bond encumbrance
Sale Information
Improvement and Site DataSale Price:
Effective Sale Price:
Sale Date:
$11,795,535
$11,795,535
09/01/2023
Closed
$236,383
$5.43
$1,814.70
$61,757 /Unit
Green Valley Recovery
Acquisition, LLC
Lennar
Real estate only
Fee Simple
100.00
Legal/Tax/Parcel ID:
Acres(Gross):
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
330-150-031
49.90 2,173,644
6,500
Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
191
GV-SP R-5,500 - R-6,000
Residential
Public Records
Zoning Desc.:
Source of Land Info.:
CommentsGrantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
This is a sale of 191 unimproved lots with a typical lot size of 6,500 square feet. The finished lot price is estimated at $200,000 per lot. A building permit is estimated at $3,000 per lot. It is unclear if the project will utilize bond financing.
However, given the surrounding projects also utilize bond financing, it is estimated the property would have an
estimated special tax of $2,000 per lot.
Cash to seller
Conditions of Sale: Arm's-length
Deed
Secondary Verification
Document Type:
Verification Type:
Sale Analysis
Expenditures After Purchase: $141,243
Expenditures Description:
Other Adjustment:
Site development costs
and permits and fees
$2,000
Green Valley Ranch PA 12
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 354
Menifee Mayor and City Council
November 6, 2024
Page
1449 of 1464
Land Sale Profile Sale No. 4
Location & Property Identification
Property Name: Stratford Place II
Sub-Property Type: Residential, Single Family
Development Land
Address: Evans Rd.
City/State/Zip:
County:
Perris, CA 92571
Riverside
Market Orientation:
IRR Event ID:
Suburban
3014316
Expenditures Description: Site Improvements and
permits and feesSale Information
Other Adjustment:
Adjustment Comments:
$2,983
Bond EncumbranceSale Price:
Effective Sale Price:
Sale Date:
$4,906,500
$4,906,500
11/01/2022
Closed Improvement and Site DataSale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
$208,079
$4.78
$817.75
$54,517 /Unit
Stratford Ranch Investors LLC
Legal/Tax/Parcel ID:
Acres(Gross):
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
302-150-049
23.58 1,027,145
6,000
90 R-6,000
Public RecordsGrantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
Pulte Home Company LLC
Real estate only
Fee Simple
100.00
Cash to seller
Source of Land Info.:
Comments
This is a sale of 90 unimproved lots with a tentative map in place and a typical lot size of 6,000 square feet. The lots were purchased for $4,906,500 or $54,517. According to the broker, the lots were purchased at a finished lot price of $230,000 per lot. The buyer is developing the 270 lots adjacent to the north of this project. It is assumed there was a degree of assemblage influencing a part of the sale, but this was not confirmed. It is estimated this project will have a similar degree of bond debt as the adjacent project, which has an estimated $2,983 per lot.
Conditions of Sale: Arm's-length
Deed
2022.451354
Blake Fassler
06/07/2023
Confirmed-Other
Document Type:
Recording No.:
Verified By:
Verification Date:
Verification Type:
Sale Analysis
Expenditures After Purchase: $175,483
Stratford Place II
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 355
Menifee Mayor and City Council
November 6, 2024
Page
1450 of 1464
Land Sale Profile Sale No. 5
Location & Property Identification
Property Name: Windsong
Sub-Property Type: Residential, Single Family
Development Land
Address: NWQ Alessandro Blvd. and
Darwin Dr.
City/State/Zip:
County:
Moreno Valley, CA 92555
Riverside
Market Orientation:
IRR Event ID:
Suburban
3022274
Expenditures After Purchase: $197,345
Sale Information
Expenditures Description:
Other Adjustment:
Adjustment Comments:
Lot finishing costs
$2,000
Estimated bond
encumbrance
Sale Price:
Effective Sale Price:
Sale Date:
$7,500,000
$7,500,000
08/01/2022
ClosedSale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Acre(Usable):
$/Land SF(Usable):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
$210,438
$4.83
$210,438
$4.83
Improvement and Site Data
Legal/Tax/Parcel ID: 487,470-025 (ptn),
487-470-028, 487-574-001 &
002$1,500.00
$42,373 /Approved Lot
Winco Holdings, Inc &
Equitable Moreno Valley II
Partnership
D.R. Horton
Fee Simple
100.00
Cash to seller
Deed
Acres(Usable/Gross):
Land-SF(Usable/Gross):
Usable/Gross Ratio:
Potential Building SF:
No. of Units (Potential):
Corner Lot:
35.64/35.64
1,552,478/1,552,478
1.00 5,000
177
Yes
Grantee/Buyer:
Property Rights:
% of Interest Conveyed:
Financing:
Document Type:
Recording No.:
Utilities: Electricity, Water Public,
Sewer, Gas, Telephone
Public RecordsSource of Land Info.:
2022.0341934 &
2022.0340965 Comments
Verification Type:
Secondary Verific. Source:
Secondary Verification
Deed, Tellus Land & Capital
This sale encompasses two adjacent parcels purchased by D.R.
Horton from two different sellers. D.R. Horton closed on the first 18.01-acre parcel for $3,755,000 on August 1, 2022 and closed on the second 17.63-acre parcel for $3,745,000 on August 2, 2022. The site will be developed into a 177-lot subdivision called Windsong. Floor plans will
Sale Analysis
Windsong
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 356
Menifee Mayor and City Council
November 6, 2024
Page
1451 of 1464
Land Sale Profile Sale No. 5
Comments (Cont'd)
range from 1,898 to 2,537 square feet and the typical lot size will be approximately 5,000 square feet. Finishing costs are estimated at approximately $197,345 per lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.
Windsong
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 357
Menifee Mayor and City Council
November 6, 2024
Page
1452 of 1464
Land Sale Profile Sale No. 6
Location & Property Identification
Property Name: La Ventana
Sub-Property Type: Residential, Single Family
Development Land
Address: SEC Simpson Rd and La
Ventana Rd
City/State/Zip:
County:
Winchester, CA 92584
Riverside
Market Orientation:
IRR Event ID:
Suburban
3027571
Expenditures After Purchase: $178,636
Sale Information
Expenditures Description:
Other Adjustment:
Adjustment Comments:
Lot finishing costs
$2,000
Estimated bond
encumbrance
Sale Price:
Effective Sale Price:
Sale Date:
Recording Date:
Listing Price:
Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
Grantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Exposure Time:
Financing:
$8,000,000
$8,000,000
04/15/2022
04/15/2022
$8,000,000
Closed
$103,896
$2.39
$1,333.33
$36,364 /Approved Lot
La Ventana 242, LLC
Forestar / DR Horton
Real estate only
Fee Simple
100.00
39 (months)
Cash to seller
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Metropolitan Statistical Area
APNs: 461-450-001
through -013, -451-001
through -048, -452-001
through -019, -460-001
through -020, -461-001
though -021, -470-001
through -027, -470-001
through -064, -472-001
through -010, -480-001
through -005, -481-001
through -003, -482-001
Legal/Tax/Parcel ID:
Conditions of Sale: Arm's-length
DeedDocument Type:
Acres(Gross): 77.00Recording No.: 0180333
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
3,354,120
6,000
Verification Type:
Secondary Verific. Source:
Secondary Verification
CoStar
220
SP
Specific Plan
Sale Analysis
Zoning Desc.:
La Ventana
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 358
Menifee Mayor and City Council
November 6, 2024
Page
1453 of 1464
Land Sale Profile Sale No. 6
Improvement and Site Data (Cont'd)
Flood Plain: No
Source of Land Info.: Broker
Comments
Site consists of 220 residential lots, along with a park site and a school site. The typical lot size is approximately 6,000 SF.
The finished lot price was reportedly $215,000/lot. It is unclear if the project will utilize bond financing. However, given surrounding projects also utilize bond financing, it is estimate the property would have an estimated special tax of $2,000 per lot.
La Ventana
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 359
Menifee Mayor and City Council
November 6, 2024
Page
1454 of 1464
Land Sale Profile Sale No. 7
Location & Property Identification
Property Name: Pleasant Valley Ranch
Sub-Property Type: Residential, Single Family
Development Land
Address: Linden Flower Rd.
Winchester, CA 92596
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3040256
Expenditures Description: Site development costs
and permits and feesSale Information
Sale Price:
Effective Sale Price:
Sale Date:
$15,728,000
$15,728,000
08/31/2021
Closed
$786,400
$18.05
$2,169.38
$77,861 /Unit
Watermarke Homes
DR Horton Los Angeles
Holding Inc
Real estate only
Fee Simple
100.00
Other Adjustment:
Adjustment Comments:
$2,688
Bond Encumbrance
Sale Status: Improvement and Site Data$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
Grantee/Buyer:
Acres(Gross):
Land-SF(Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
20.00 871,200
7,250
202
R-1
Residential
Public Records
Zoning Desc.:
Source of Land Info.:Assets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
Comments
Cash to seller This is a sale of 202 paper lots with a typical lot size of 7,250 square feet for $77,861 per lot. The lots included the sale of five partially completed models that were constructed prior to the Great Recession in 2007. The backstory to the project was not given; however, it appears one of the previous owners of the project tried to develop the property and later abandon it.
The prior models on the property were demolished by DR
Horton and the site development to improve the lots was estimated at $15,400,862 or $76,242 per lot. Permits and fees are estimated at $73,000 per lot, while special taxes are estimated at $2,688 per lot.
Conditions of Sale: Arm's-length
Deed
Blake Fassler
08/22/2023
Confirmed-Buyer
Document Type:
Verified By:
Verification Date:
Verification Type:
Sale Analysis
Expenditures After Purchase: $150,861
Pleasant Valley Ranch
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 360
Menifee Mayor and City Council
November 6, 2024
Page
1455 of 1464
Addenda
Land Sales - West Shore at Rockport Ranch
City of Menifee CFD No. 2023-1 (Rockport Ranch)
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 361
Menifee Mayor and City Council
November 6, 2024
Page
1456 of 1464
Land Sale Profile Sale No. 1
Location & Property Identification
Property Name: Riverwalk Village
Sub-Property Type: Residential, Single Family
Development Land
Address: Bradley Rd.
City/State/Zip:
County:
Menifee, CA 92586
Riverside
Market Orientation:
IRR Event ID:
Suburban
3270380
Other Adjustment:
Adjustment Comments:
$2,000
Bond encumbranceSale Information
Sale Price:
Effective Sale Price:
Sale Date:
$22,077,500
$22,077,500
12/06/2023
Closed
Improvement and Site Data
Legal/Tax/Parcel ID:
Acres(Gross):
338-150-046 and -031
14.64Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
$1,508,026
$34.62
$9,812.22
$111,503 /Unit
Crp / Cwr River Walk Project
LLC
Land-SF(Gross): 637,718
2,250Potential Building SF:
No. of Units (Potential):
Zoning Code:
Zoning Desc.:
Source of Land Info.:
198
MDR
Medium Density Residential
Public Records
Grantee/Buyer: Richmond American Homes /
MD Inc
Real estate only
Fee Simple
100.00
Cash to seller
Comments
Assets Sold: This is a sale of 198 lots in unimproved condition. The lots are configured in an 8-pack courtyard cluster and have several community amenities. Based on the density of the project, the typical lot size is estimated at 2,250 square feet. The finished lot is estimated at $225,338 per lot. A building permit is estimated at $4,900 per lot. The project is utilizing special taxes; however, the exact annual payment is unclear.
Therefore, based on the surrounding projects an annual
special tax is estimated at $2,000 per lot.
Property Rights:
% of Interest Conveyed:
Financing:
Conditions of Sale: Arm's-length
Deed
Secondary Verification
Document Type:
Verification Type:
Sale Analysis
Expenditures After Purchase: $118,735
Expenditures Description: Site development costs
and permits and fees
Riverwalk Village
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 362
Menifee Mayor and City Council
November 6, 2024
Page
1457 of 1464
Land Sale Profile Sale No. 2
Location & Property Identification
Property Name: Alessandro
Sub-Property Type: Residential, Single Family
Development Land
Address: Alessandro Blvd.
Moreno Valley, CA 92555
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3246636
Adjustment Comments: Estimated bond
encumbranceSale Information
Sale Price:
Effective Sale Price:
Sale Date:
Recording Date:
Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$16,143,500
$16,143,500
11/30/2023
12/04/2023
Closed
$873,566
$20.05
$5,381.17
Improvement and Site Data
Legal/Tax/Parcel ID:
Acres(Gross):
487-470-022
18.48 Land-SF(Gross): 804,989
3,000Potential Building SF:
No. of Units (Potential):
Zoning Code:
225
DC
$/Unit (Potential):
Grantor/Seller:
Grantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
$71,749 /Unit
Gpalessandro LLC
Taylor Morrison Of California
Real estate only
Fee Simple
Zoning Desc.:
Source of Land Info.:
Downtown Center
Public Records
Comments
This is a sale of 225 tentatively mapped lots with a typical lot size of 3,000 square feet. The lots will be developed into clusters; however, it is unclear the exact layout. The finished lot price is estimated at $201,265 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing. However, given the surrounding
projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.
100.00
Cash to seller
Conditions of Sale: Arm's-length
Deed
2023.359986
Secondary Verification
Document Type:
Recording No.:
Verification Type:
Sale Analysis
Expenditures After Purchase: $131,516
Expenditures Description:
Other Adjustment:
Site development and
building permit
$2,000
Alessandro
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 363
Menifee Mayor and City Council
November 6, 2024
Page
1458 of 1464
Land Sale Profile Sale No. 3
Location & Property Identification
Property Name: 27550 Brodiaea Avenue
Sub-Property Type: Residential, Single Family
Development Land
Address: 27550 Brodiaea Ave.
Moreno Valley, CA 92555
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3246647
Adjustment Comments: Estimated bond
encumbranceSale Information
Sale Price:
Effective Sale Price:
Sale Date:
$2,800,055
$2,800,055
07/01/2023
Closed
Improvement and Site Data
Legal/Tax/Parcel ID:
Acres(Gross):
486-240-010
8.77Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
$319,277
$7.33
$777.79
$41,792 /Unit
Discovery Christian Church Of
Moreno Valley
Land-SF(Gross): 382,021
3,600Potential Building SF:
No. of Units (Potential):
Zoning Code:
Zoning Desc.:
Source of Land Info.:
67 R5
Suburban Residential
Public Records
Grantee/Buyer: DR Horton Los Angeles
Holding Comments
Assets Sold: Real estate only
Fee Simple
100.00
This is a sale of 67 tentatively mapped lots with a typical lot size of 3,600 square feet. The finished lot price is estimated at $177,669 per lot. A building permit is estimated at $2,000 per lot. It is unclear if the project will utilize bond financing.
However, given the surrounding projects also utilize bond financing, it is estimated the property would have an
estimated special tax of $2,000 per lot.
Property Rights:
% of Interest Conveyed:
Financing: Cash to seller
Conditions of Sale: Arm's-length
Deed
Secondary Verification
Document Type:
Verification Type:
Sale Analysis
Expenditures After Purchase: $137,877
Expenditures Description:
Other Adjustment:
Site development and
building permit
$2,000
27550 Brodiaea Avenue
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 364
Menifee Mayor and City Council
November 6, 2024
Page
1459 of 1464
Land Sale Profile Sale No. 4
Location & Property Identification
Property Name: Towns & Courts
Sub-Property Type: Residential, Single Family
Development Land
Address: Domenigoni Pky.
Winchester, CA 92596
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3246654
Adjustment Comments: Estimated bond
encumbranceSale Information
Sale Price:
Effective Sale Price:
Sale Date:
$17,500,000
$17,500,000
04/01/2022
Closed
Improvement and Site Data
Legal/Tax/Parcel ID:
Acres(Gross):
461-220-39 and -040
21.21Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
Grantee/Buyer:
$825,083
$18.94
$7,000.00
$69,444 /Unit
Regent
Taylor Morrison / California
LLC
Real estate only
Fee Simple
100.00
Cash to seller
Land-SF(Gross): 923,908
2,500Potential Building SF:
No. of Units (Potential):
Zoning Code:
Zoning Desc.:
Source of Land Info.:
252
SP
Specific Plan
Public Records
CommentsAssets Sold:
Property Rights:
% of Interest Conveyed:
Financing:
This is a sale of 252 lots in bluetop condition. The project will be developed as 124 townhomes and 128 cluster lot homes.
Based on the density of the project, the typical lot size is estimated at 2,500 square feet. The finished lot is estimated at $150,000 per lot. A building permit is estimated at $2,000 per lot. The project is utilizing special taxes; however, the exact annual payment is unclear. Therefore, based on the
surrounding projects an annual special tax is estimated at $2,000 per lot.
Conditions of Sale: Arm's-length
Deed
Secondary Verification
Document Type:
Verification Type:
Sale Analysis
Expenditures After Purchase: $82,556
Expenditures Description:
Other Adjustment:
Site development and
building permit
$2,000
Towns & Courts
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 365
Menifee Mayor and City Council
November 6, 2024
Page
1460 of 1464
Land Sale Profile Sale No. 5
Location & Property Identification
Property Name: SWC Leon Rd & Simpson Rd
Sub-Property Type: Residential, Single Family
Development Land
Address: SWC Leon Rd & Simpson Rd
Winchester, CA 92596
Riverside
City/State/Zip:
County:
Market Orientation:
IRR Event ID:
Suburban
3027023
Expenditures After Purchase: $132,952
Sale Information
Expenditures Description: Site development costs
and building permitSale Price:
Effective Sale Price:
Sale Date:
Recording Date:
Listing Price:
Sale Status:
$/Acre(Gross):
$/Land SF(Gross):
$/Land SF(Usable):
$/Building SF:
$/Unit (Potential):
Grantor/Seller:
Grantee/Buyer:
Assets Sold:
Property Rights:
% of Interest Conveyed:
Exposure Time:
Financing:
$8,000,000
$8,000,000
02/15/2022
02/15/2022
$10,000,000
Closed
$111,142
$2.55
$2.55
$2,666.67
$19,048 /Approved Lot
Ranchos Property & Rancon
BRPLD LLC
Real estate only
Fee Simple
100.00
37 (months)
Cash to seller
Other Adjustment:
Adjustment Comments:
$2,000
Bond encumbrance
Improvement and Site Data
MSA:
Legal/Tax/Parcel ID:
Inland Empire
Parcel Numbers: 460-150-019,
461-150-006
71.98 3,135,448/3,135,448
3,000
Acres(Gross):
Land-SF(Usable/Gross):
Potential Building SF:
No. of Units (Potential):
Zoning Code:
Zoning Desc.:
Flood Plain:
420
SP
Specific Plan
No
Flood Zone Designation:
Source of Land Info.:
X
Public RecordsConditions of Sale: Arm's-length
Deed
0076695
Document Type:
Recording No.:
Comments
Property sold with a recorded final map for 420 single family lots. The site also includes two future parks. The estimated lot size is 3,000 square feet. The brokers estimates a finished lot value of $150,000 per lot. A building permit within the unincorporated area of Winchester is estimated at $2,000 per lot. It is unclear if
Verification Type:
Secondary Verific. Source:
Secondary Verification
CoStar
Sale Analysis
SWC Leon Rd & Simpson Rd
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 366
Menifee Mayor and City Council
November 6, 2024
Page
1461 of 1464
Land Sale Profile Sale No. 5
Comments (Cont'd)
the project will utilize bond financing. However, given the surrounding projects also utilize bond financing, it is estimated the property would have an estimated special tax of $2,000 per lot.
SWC Leon Rd & Simpson Rd
Item Title: 12.1
Issuance of Special Tax Bonds for Community Facilities District 2023-1, Rockport Ranch Item Page Number: 367
Menifee Mayor and City Council
November 6, 2024
Page
1462 of 1464
CITY OF MENIFEE
SUBJECT: 2025 City Council Meeting Calendar
MEETING DATE: November 6, 2024
TO: Mayor and City Council
PREPARED BY: Stephanie Roseen, Acting City Clerk
REVIEWED BY: Stephanie Roseen, Acting City Clerk
APPROVED BY: Armando G. Villa, City Manager
-------------------------------------------------------------------------------------------------------------------------------
RECOMMENDED ACTION
1. Review the dates for the 2025 City Council Meetings and provide direction to staff of potential conflicts and cancelations.
DISCUSSION
The City Council’s regular meetings are held on the first and third Wednesday of each month starting at 6:00 p.m. In Table 1 on the following page is the full meeting calendar for 2025.
Annually, the City Council is provided with the opportunity to review next year’s meeting calendar to determine if there is a need for any meeting cancellations or rescheduling due to any conflicts.
Although the City Council may cancel or reschedule a meeting at any time throughout the year for any reason, this advanced planning process provides an opportunity for staff to plan for placement of agenda items accordingly. If the need arises, the City Council could call for a special meeting or choose to hold a regular meeting and not move forward with the cancelation.
The following meeting dates have been identified as dates that may have conflicts with staff report preparation and approvals or are dates that have been previously canceled by the City Council. In previous years the City Council has canceled one meeting in October due to a conflict with the League of California Annual Conference. In 2025, the conference does not conflict with the City Council meeting.
•January 1, 2025: Observation of New Years Day.
•July 2, 2025: The City Council may also want to consider canceling a meeting during the summer months. Many other cities and regional agencies cancel meetings to allow for vacations during this time.
Item Title: 12.2
2025 City Council Meeting Calendar
Item Page Number: 1
Menifee Mayor and City Council
November 6, 2024
Page
1463 of 1464
City of Menifee Staff Report
2025 City Council Meeting Calendar
November 6, 2024