Preliminary, subject to change.
1179
25 TABLE 3
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER)
OF THE CITY OF PERRIS
ESTIMATED VALUE-TO-LIEN BY PROPERTY OWNER AND PARCEL
Property Owner APN
Taxable
Acres
Assessed/
Appraised
Value(1)
Fiscal Year
2026-27
Maximum
Special
Tax
% of
Maximum
Special Tax
Share of
2026 Bonds*
Direct
and
Overlapping
Debt
Total Direct
and
Overlapping
Debt*
Valueto-Lien
Ratio*
Developed Property
IDIL Perris Logistics Center North LP (Medline) 310-170-020 48.28 $ 221,000,000 $ 225,435 14.74% $ 1,867,239 $ 286,120 $ 2,153,359 102.61:1 IDIL Perris Logistics Center North LP (Lowe’s) 310-170-021 57.90 166,365,714 270,353 17.67 2,239,295 336,789 2,576,084 64.58:1 Recline Borrower LLC (Home Depot) 310-170-016 55.10 191,294,300 257,279 16.82 2,131,004 4,706,727 6,837,731 27.98:1 Total Developed Property 161.28 $ 578,660,014 $ 753,067 49.23% $ 6,237,538 $ 5,329,636 $11,567,174 50.03:1 Undeveloped Property
Anatolia Perris(2) 330-120-002 46.52 $ 71,643,995 $ 217,217 14.20% $ 1,799,171 $ 1,684,392 $ 3,483,563 20.57:1 Anatolia Perris(2) 330-120-017 23.36 35,976,005 109,075 7.13 903,453 846,638 1,750,091 20.56:1 Subtotal Anatolia Perris 69.88 $ 107,620,000 $ 326,292 21.33% $ 2,702,624 $ 2,531,030 $ 5,233,654 20.56:1 Silver Hollow(3) 330-120-018 50.15 $ 78,305,831 $ 234,166 15.31% $ 1,939,562 $ 2,255,242 $ 4,194,804 18.67:1 Silver Hollow(3) 330-120-020 10.73 16,754,169 50,102 3.28 414,985 483,400 898,385 18.65:1 Subtotal Silver Hollow 60.88 $ 95,060,000 $ 284,268 18.58% $ 2,354,547 $ 2,738,642 $ 5,093,189 18.66:1 IDIL Perris Fulfillment Center LP 330-120-021 35.56 $ 51,440,000 $ 166,041 10.85% $ 1,375,291 $ 998,144 $ 2,373,435 21.67:1 Subtotal IDI Fulfillment Center LP 35.56 $ 51,440,000 $ 166,041 10.85% $ 1,375,291 $ 998,144 $ 2,373,435 21.67:1 Total Undeveloped Property 166.32 $ 254,120,000 $ 776,601 50.77% $ 6,432,462 $ 6,267,816 $12,700,278 20.01:1 Total 327.60 $ 832,780,014 $1,529,668 100.00% $12,670,000 $11,597,452 $24,267,452 34.32:1 * Preliminary, subject to change.
(1) Based on assessed value for fully the developed North Site 2 and North Site 3 on the County Assessor’s Fiscal Year 2026-27 roll and the Appraisal Report as of the August 14, 2026 Date of Value for the remaining parcels. (2) On July 21, 2026, the Master Developer recorded a new parcel map to create three parcels at the South Site, one for each of South Site 1, South Site 2 and South Site 3, which combined these two parcels into one taxable parcel. However, new Assessor’s Parcel Numbers have not yet been assigned by the County. (3) On July 21, 2026, the Master Developer recorded a new parcel map to create three parcels at the South Site, one for each of South Site 1, South Site 2 and South Site 3, which combined these two parcels into one taxable parcel. However, new Assessor’s Parcel Numbers have not yet been assigned by the County.
Sources: Willdan Financial Services; Integra Realty Resources; County of Riverside. 1180
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TABLE 4
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER)
OF THE CITY OF PERRIS
VALUE-TO-LIEN CATEGORIES
Value to Lien
Category
No.
Obligated
Parcels(1)
Total
Direct & Overlapping
Debt(2)* % of Total*
Assessed/
Appraised
Value(3)
% Total
Assessed/
Appraised
Value
Average
Value to
Lien*
Greater than 20.00:1 6 $ 19,174,263 79.01% $ 737,720,014 88.59% 38.47
10.00:1 to 19.99:1 2 5,093,189 20.99 95,060,000 11.41 18.66 Less Than 10.00:1 - - - - - -
Total 8 $ 24,267,452 100.00% $ 832,780,014 100.00% 34.32 * Preliminary, subject to change.
(1) On July 21, 2026, the Master Developer recorded a new parcel map to create three parcels at the South Site, one for each of South Site 1, South Site 2 and South Site 3, which results in the District consisting of a total of six separate taxable parcels.
However, new Assessor’s Parcel Numbers have not yet been assigned by the County. (2) Based on the principal amount of the Bonds in the amount of $12,670,000* plus $11,597,452 in overlapping debt. (3) Based on assessed value for fully the developed North Site 2 and North Site 3 on the County Assessor’s Fiscal Year 2026-27 roll and the Appraisal Report as of the August 14, 2026 Date of Value for the remaining parcels.
Sources: Willdan Financial Services; Integra Realty Resources; California Municipal Statistics, Inc.
Delinquency History
The Special Taxes were first levied within the District during Fiscal Year 2024-25. The following table is a summary of levies, collections and delinquency rates of the Special Taxes in the District, beginning in Fiscal Year 2024-25.
TABLE 5
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER)
OF THE CITY OF PERRIS
SPECIAL TAX RECEIPTS
Fiscal Year
No.
of Parcels
Levied
Amount
Levied
Parcels
Delinquent
Amount
Delinquent
as of June 3
Fiscal Year End % Delinquent
2024-25 8 $1,441,440 0 $ 0.00 0.00%
2025-26 8 $1,499,674 0 $ 0.00 0.00%
Source: Riverside County, compiled by Willdan Financial Services.
Direct and Overlapping Bonded Indebtedness
In addition to the District, numerous overlapping local agencies provide a variety of governmental services. The direct and overlapping bonded indebtedness of property in the District as of July 1, 2026 is shown in the table below (the “Debt Report”). In addition to the bonded indebtedness set forth in the Debt Report, new community facilities districts or special assessment districts may be formed which encompass all or a portion of the property in the District; and, upon approval of registered voters or landowners within such districts, such districts or the agencies that formed them may issue more bonds and levy additional special or other taxes or assessments. In addition to the Special Taxes and other special taxes and assessments, the property owners in the District will be required to pay the general ad valorem property tax. The Debt Report has been derived from data assembled and reported to the City by California Municipal Statistics, Inc., as of July 1, 2026. 1181
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TABLE 6
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER)
OF THE CITY OF PERRIS
DIRECT AND OVERLAPPING DEBT
2025-26 Assessed Valuation: $462,110,095
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT:
%
Applicable Debt 7/1/26
Metropolitan Water District General Obligation Bonds 0.011% $ 1,742 Mt. San Jacinto Community College District General Obligation Bonds 0.307 715,672 Perris Union High School District General Obligation Bonds 1.435 3,980,417 Perris School District General Obligation Bonds 9.774 6,899,621 City of Perris Community Facilities District No. 2022-2 100. 0 (1)
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $ 11,597,452 OVERLAPPING GENERAL FUND DEBT:
Riverside County General Fund Obligations 0.103% $ 1,126,402 Riverside County Pension Obligation Bonds 0.103 565,530 Perris Union High School District General Fund Obligations 1.435 563,265 Perris School District General Fund Obligations 9.774 345,008 City of Perris General Fund Obligations 3.384 106,039
TOTAL OVERLAPPING GENERAL FUND DEBT $ 2,706,244
COMBINED TOTAL DEBT $ 14,303,696(2)
Ratios to 2025-26 Assessed Valuation:
Direct Debt ($0).................................................................................................. 0.00% Total Overlapping Tax and Assessment Debt ....................................................... 2.51% Combined Total Debt............................................................................................ 3.10% (1) Excludes the Bonds.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
SPECIAL RISK FACTORS
The purchase of the Bonds involves certain investment risks which are discussed throughout this Official Statement. Each prospective investor should make an independent evaluation of all information presented in this Official Statement in order to make an informed investment decision. Particular attention should be given to the factors described below which, among others, could affect the payment of debt service on the Bonds.
Risks of Real Estate Secured Investments Generally
The Bond Owners will be subject to the risks generally incident to an investment secured by real estate, including, without limitation: (i) adverse changes in local market conditions, such as changes in the market value of real property in the vicinity of the District, the supply of or demand for competitive properties in such area, and the market value of property or buildings and/or sites in the event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relating to endangered species and hazardous materials) and fiscal policies; (iii) natural disasters (including, without limitation, earthquakes, wildfires and floods), which may result in uninsured losses; (iv) adverse changes in local market conditions; and (v) increased delinquencies due to rising mortgage costs and other factors.
No assurance can be given that the individual property owners within the District will pay Special Taxes in the future or that they will be able to pay such Special Taxes on a timely basis. See the caption “— 1182
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Enforcement Delays – Bankruptcy” for a discussion of certain limitations on the District’s ability to pursue judicial proceedings with respect to delinquent parcels within the District.
Limited Obligations
The Bonds are limited obligations of the District payable only from amounts pledged under the Fiscal Agent Agreement, which consist primarily of payments made to the Fiscal Agent on the Bonds. Funds for the payment of the principal of and the interest on the Bonds are derived only from payments of Special Taxes. The amount of Special Taxes that are collected could be insufficient to pay principal of and interest on the Bonds due to non-payment of the Special Taxes levied or due to insufficient proceeds received from a judicial foreclosure sale of land within the District following delinquency. The District’s legal obligation with respect to any delinquent Special Taxes is limited to the institution of judicial foreclosure proceedings under certain circumstances with respect to any parcels for which Special Taxes are delinquent. The Bonds cannot be accelerated in the event of any default.
Failure by owners of the parcels within the District to pay Special Tax installments when due, delay in foreclosure proceedings, or the inability of the District to sell parcels which have been subject to foreclosure proceedings for amounts sufficient to cover the delinquent installments of Special Taxes levied against such parcels may result in the inability of the District to make full or timely payments of debt service on the Bonds, which may, in turn, result in the depletion of the Reserve Account for the Bonds and the inability of the District to make full or timely payment on the Bonds.
No Obligation of City
The Bonds and the interest thereon, and in turn, the Bonds, are not payable from the general funds of the City. Except with respect to the Special Taxes, neither the credit nor the taxing power of the District or the City is pledged for the payment of the Bonds or the interest thereon, and except to compel a levy of the Special Taxes securing the Bonds, no Owner of the Bonds may compel the exercise of any taxing power by the District or the City or force the forfeiture of any property of the City or the District. The principal of, premium, if any, and interest on the Bonds are not a debt of the City or the District or a legal or equitable pledge, charge, lien or encumbrance upon any of the City’s or the District’s property or upon any of the City’s or the District’s income, receipts or revenues, except the Special Tax Revenues and other amounts pledged under the Fiscal Agent Agreement.
Potential Early Redemption of Bonds from Prepayments
Property owners within the District are permitted to prepay their Special Taxes at any time. Such prepayments will result in a redemption of Bonds on the first March 1 or September 1 which is more than 30 days following the receipt of the prepayment. The proceeds of the Bonds so redeemed will then be used to make a mandatory redemption of the Bonds. The Bonds will be called on a pro rata basis from the proceeds of the Bonds redeemed from prepayments and from surplus funds held under the Fiscal Agent Agreement. See “THE BONDS — Redemption.”
Insufficiency of Special Taxes
Notwithstanding that the maximum Special Taxes that may be levied in the District exceeds debt service due on the Bonds, the Special Taxes collected could be inadequate to make timely payment of debt service either because of nonpayment or because property becomes exempt from taxation.
The Rate and Method governing the levy of the Special Taxes within the District expressly exempts up to a specified number of acres of property owned by public entities, homeowner associations, churches and other specified owners. If for any reason property within a District becomes exempt from taxation by reason of ownership by a non-taxable entity such as the federal government, another public agency or other organization 1183
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determined to be exempt, subject to the limitations of the maximum authorized rates, the Special Tax will be reallocated to the remaining taxable properties within such District. This could result in certain owners of property paying a greater amount of the Special Tax and could have an adverse impact upon the ability and willingness of the owners of such property to pay the Special Tax when due.
The Mello-Roos Act provides that, if any property within a District not otherwise exempt from the Special Tax is acquired by a public entity through a negotiated transaction, or by gift or devise, the Special Tax will continue to be levied on and enforceable against the public entity that acquired the property. In addition, the Mello-Roos Act provides that, if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property is to be treated as if it were a special assessment and be paid from the eminent domain award. The constitutionality and operation of these provisions of the Mello-Roos Act have not been tested in the courts. Due to problems of collecting taxes from public agencies, if a substantial portion of land within a District became exempt from the Special Tax because of public ownership, or otherwise, the maximum Special Taxes which could be levied upon the remaining taxable property therein might not be sufficient to pay principal of and interest on the related Bonds when due and a default could occur with respect to the payment of such principal and interest, and, in turn, a default could occur in the payment of the principal and interest on the Bonds.
Failure to Develop Properties
Development of property within the District is ongoing. See the caption “THE DISTRICT” for a description of the development status of the property in the District. Undeveloped or partially developed land is inherently less valuable than developed land and provides less security to the Owners of the Bonds should it be necessary for the District to foreclose on the property due to the nonpayment of Special Taxes. See the captions “THE COMMUNITY FACILITIES DISTRICT— Property Values and the Appraisal Report ” and “— Estimated Value-to-Lien Ratios” The failure to complete development of the required infrastructure for development in the District as planned, or substantial delays in the completion of the development or the required infrastructure for the development due to litigation or other causes may reduce the value of the property within the District and increase the length of time during which Special Taxes will be payable from undeveloped property, and may affect the willingness and ability of the owners of property within the District to pay the Special Taxes when due.
Land development is subject to comprehensive federal, State and local regulations. Approval is required from various agencies in connection with the layout and design of developments, the nature and extent of improvements, construction activity, land use, zoning, school and health requirements, as well as numerous other matters. There is always the possibility that such approvals will not be obtained or, if obtained, will not be obtained on a timely basis. Failure to obtain any such agency approval or satisfy such governmental requirements would adversely affect planned land development. Finally, development of land is subject to economic considerations.
The future development of the land within the District may be adversely affected by existing or future governmental policies, or both, restricting or controlling the development of land in the District.
There can be no assurance that land development operations within the District will not be adversely affected by a future deterioration of the real estate market and economic conditions, increases in interest rates for real estate loans or future local, State and federal governmental policies relating to real estate development, the income tax treatment of real property ownership, or the national economy. A slowdown of the development process and the absorption rate could adversely affect land values and reduce the ability or desire of the property owners to pay the annual Special Taxes. In that event, there could be a default in the payment of principal of, and interest on, the Bonds when due.
Owners of the Bonds should assume that any event that significantly impacts the ability to develop land in the District or delays the timing of development would cause the property values within the District to decrease 1184
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substantially from those estimated by the Appraiser and could affect the willingness and ability of the owners of land within the District to pay the Special Taxes when due. See “THE COMMUNITY FACILITEIS DISTRICT—Development Within the District” herein.
Based on current development status, the payment of principal of and interest on the Bonds depends upon the receipt of Special Taxes levied on undeveloped property. Undeveloped property is less valuable per unit of area than developed land, especially if there are no plans to develop such land or if there are severe restrictions on the development of such land. The undeveloped property also provides less security to the Owners of the Bonds should it be necessary for the District to foreclose on undeveloped property due to the nonpayment of the Special Taxes. Furthermore, an inability to develop the land within the District as currently proposed will make the Owners of the Bonds dependent upon timely payment of the Special Taxes levied on undeveloped property for a longer period of time than projected. A slowdown or stoppage in the continued development of the District could reduce the willingness and ability of the landowners to make Special Tax payments on undeveloped property and could greatly reduce the value of such property in the event it has to be foreclosed upon. See “SPECIAL RISK FACTORS—Reductions in Property Values” below.
Concentration of Ownership
The District has a significant concentration of ownership and there are currently only five property owners within the District, two of which are affiliates of the Master Developer. Based on property ownership as of August 14, 2026, affiliates of the Master Developer are projected to be responsible for approximately
43.26% of the projected Fiscal Year 2026-27 Special Tax levy within the District, and Recline, Anatolia Perris and Silver Hollow are projected to be responsible for 16.82%, 21.33% and 18.58%, respectively, of the projected Fiscal Year 2026-27 Special Tax levy within the District. The inability or refusal of any of the property owners within the District to pay the Special Tax applicable to their property when due could result in a draw on the Reserve Account prior to replenishment thereof from sale or foreclosure proceedings, and/or insufficient money with which to pay the principal of and interest on the Bonds as the same became due.
Geologic, Topographic and Climatic Conditions
General. The market value of the property within the District can be adversely affected by a variety of factors which may affect public and private improvements. Such additional factors include, without limitation, geologic conditions (such as earthquakes), topographic conditions (such as earth movements) and climatic conditions (such as droughts, fire hazard and floods). In the event of a severe earthquake, fire, flood or other natural disaster, there may be significant damage to both property and infrastructure in the District. As a result, a substantial portion of the property owners may be unable or unwilling to pay the Special Taxes when due. In addition, the value of land in the District could be diminished in the aftermath of such a natural disaster, reducing the resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the Special Taxes.
Geologic Conditions and Seismic Activity. With respect to geologic conditions, building codes require that some of these factors be taken into account in the design of private improvements of the parcels, and the County has adopted the Uniform Building Code standards with regard to seismic standards. Design criteria are established upon the basis of a variety of considerations and may change, leaving previously designed improvements unaffected by more stringent subsequently established criteria. In general, design criteria reflect a balance at the time of establishment between the present costs of protection and the future costs of lack of protection, based in part upon a present perception of the probability that the condition will occur and the seriousness of the condition should it occur. Consequently, neither the absence of nor the establishment of design criteria with respect to any particular condition means that the applicable governmental agency has evaluated the condition and has established design criteria in the situations in which such criteria are needed to preserve value, or has established such criteria at levels that will preserve value. To the contrary, the District expects that one or more of such conditions may occur and may result in damage to improvements of varying seriousness, that the damage may entail significant repair or replacement costs and that repair or replacement may never occur either because of the cost, because repair or replacement will not facilitate habitability or other 1185
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use, or because other considerations preclude such repair or replacement. Under any of these circumstances, the actual value of the parcels may well depreciate or disappear, notwithstanding the establishment of design criteria for any such condition.
Southern California is a seismically active area. Seismic activity represents a potential risk for damage to buildings, roads, bridges and property within the District. In addition, land susceptible to seismic activity may be subject to liquefaction during the occurrence of such event. Although the land within the District is subject to seismic activity, it is not located within an Alquist-Priolo Earthquake Fault Zone.
Wildfires. In recent years, wildfires have caused extensive damage throughout the State, including within the County. Certain of these fires have burned thousands of acres and destroyed hundreds and in some cases thousands of homes. In some instances, entire neighborhoods have been destroyed. Several of the fires that occurred recently damaged or destroyed property in areas that were not previously considered to be at risk from such events. In 2025, communities in Los Angeles County, including Pacific Palisades, Malibu and Altadena, experienced widespread devastation from wildfires causing losses of life, thousands of burned homes, and billions of dollars in property damage. The District experiences high winds known as Santa Ana winds which frequently accompany and magnify the intensity of wildfires. The District can provide no assurances that property within the District will not be impacted by wildfires in the future. There is a risk of property within the District being destroyed by wildfires and no assurance can be given as to the severity or frequency of wildfires within the vicinity of the District. Additionally, property located adjacent to burn areas can be subject to mudslides and flooding, which can cause significant damage and destruction to property.
In March 2025, the California Department of Forestry and Fire Protection (“Cal Fire”) released an updated Fire Hazard Severity Zone map for the Southern California region. The Cal Fire Hazard Severity Zone maps evaluate fire hazard, which is defined as the likelihood and expected fire behavior over a 30 to 50-year period without considering mitigation measures such as home hardening, recent wildfire or fuel reduction efforts, as opposed to risk, which is the potential damage a fire can do to the area under existing conditions, accounting for any modifications such as fuel reduction projects, defensible space, and ignition resistant building construction. Pursuant to State law, the State Fire Marshal is mandated to classify the state responsibility areas where the state has financial responsibility for wildfire protection and prevention into Fire Hazard Severity Zones classified as “Moderate,” “High” or “Very High.” In areas designated as local responsibility areas, where local agencies have financial responsibility for wildfire protection and prevention, Cal Fire’s Fire Hazard Severity Zone maps make recommendations for the classification of Moderate, High or Very High Fire Hazard Severity Zones and the local agencies must adopt maps which either adopt Cal Fire’s recommendations or place the relevant areas in a higher classification. For more information on Cal Fire’s Fire Hazard Severity Zone maps, see the Cal Fire website. No portion of the District is located within a High or Very High Fire Hazard Severity Zone, however a small portion of the southwest area of the South Site is designated as a Moderate Fire Hazard Severity Zone .
[Flooding. Portions of each of the North Site and the South Site are located within the 100-year flood plain; however, according to the Master Developer, the Federal Emergency Management Agency (“FEMA”) has issued a Conditional Letter of Map Revision (the “CLOMR”) with respect to the property within the District. the CLOMR assumes the installation of perimeter channels and on-site basins, which are currently under construction by the Master Developer and expected to be completed in ____ 20__. Upon completion of the improvements required by the CLOMR, the developable portion of the property within the District will be removed from the 100-year flood plain and located in a Zone “X” flood area (an area of minimal flooding, outside the 500-year flood plain), and flood insurance is not required, and the flood plain designation will be moved to the channel and basin footprints.]
Property Insurance
In recent years, homeowners in many areas in the State have experienced significant increases in premiums for property and homeowners’ insurance policies as well as difficulty in obtaining such insurance 1186
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from commercial insurance companies. Such increases in the overall cost of homeownership could have a material adverse effect on the rate of absorption of the remaining units in the District and on a homeowner’s willingness and/or ability to pay the Special Taxes.
In addition, no assurances can be made that adequate homeowners’ insurance coverage will be available in the future from reputable insurance companies, with premiums comparable to historical rates, or at all. The inability to obtain adequate insurance coverage could impact the ability of the homeowners’ in the District to reconstruct their homes in the event of damage.
Hazardous Substances
While government taxes, assessments and charges are a common claim against the value of a parcel, other less common claims may also be relevant. One of the most serious in terms of the potential reduction in the value of a parcel is a claim with regard to a hazardous substance. In general, the owners and operators of a parcel may be required by law to remedy conditions relating to releases or threatened releases of hazardous substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as “CERCLA” or the “Super Fund Act,” is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar in effect. Under many of these laws, the owner (or operator) is obligated to remedy a hazardous substance condition of a parcel whether or not the owner (or operator) had anything to do with creating or handling the hazardous substance.
The effect, therefore, should any of the parcels within the District be affected by a hazardous substance, is to reduce the marketability and value by the costs of remedying the condition.
It is possible that property in the District may be liable for hazardous substances in the future as a result of the existence, currently, of a substance presently classified as hazardous but which has not been released or the release of which is not presently threatened, or the existence, currently, on the property of a substance not presently classified as hazardous but which may in the future be so classified. Additionally, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling such substance.
All of these possibilities could have the effect of reducing the value of the applicable property.
Enforcement Delays – Bankruptcy
In the event of a delinquency in the payment of the Special Taxes, the District is required to commence enforcement proceedings under the circumstances described under the heading “SECURITY FOR THE BONDS — Covenants of the District.” However, prosecution of such proceedings could be delayed due to crowded local court calendars or by bankruptcy, insolvency and other laws generally affecting creditors’ rights (such as the Soldiers’ and Sailors’ Relief Act of 1940) and by the laws of the State relating to judicial and non-judicial foreclosure. Although bankruptcy proceedings would not cause the liens of the Special Taxes to become extinguished, bankruptcy of a person or entity with an interest in the applicable property could result in a delay in the enforcement proceedings because federal bankruptcy laws provide for an automatic stay of foreclosure and tax sale proceedings. Any such delay could increase the likelihood of delay or default in payment of the principal of and interest on the applicable Bonds.
FDIC/Federal Government Interests in Parcels
The ability of the District to collect interest and penalties specified by the Mello-Roos Act and to foreclose the lien of delinquent Special Taxes may be limited in certain respects with regard to parcels in which the Federal Deposit Insurance Corporation (the “FDIC”), or other federal government entities such as Fannie Mae or Freddie Mac, has or obtains an interest.
In the case of FDIC, in the event that any financial institution making a loan which is secured by parcels is taken over by the FDIC and the applicable Special Tax is not paid, the remedies available to the District may be constrained. The FDIC’s policy statement regarding the payment of state and local real property taxes (the 1187
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“Policy Statement”) provides that taxes other than ad valorem taxes which are secured by a valid lien in effect before the FDIC acquired an interest in a property will be paid unless the FDIC determines that abandonment of its interests is appropriate. The Policy Statement provides that the FDIC generally will not pay installments of non-ad valorem taxes which are levied after the time the FDIC acquires its fee interest, nor will the FDIC recognize the validity of any lien to secure payment except in certain cases where the Resolution Trust Corporation had an interest in property on or prior to December 31, 1995. Moreover, the Policy Statement provides that, with respect to parcels on which the FDIC holds a mortgage lien, the FDIC will not permit its lien to be foreclosed out by a taxing authority without its specific consent, nor will the FDIC pay or recognize liens for any penalties, fines or similar claims imposed for the non-payment of taxes.
The FDIC has taken a position similar to that expressed in the Policy Statement in legal proceedings brought against Orange County in United States Bankruptcy Court and in Federal District Court. The Bankruptcy Court issued a ruling in favor of the FDIC on certain of such claims. Orange County appealed that ruling, and the FDIC cross-appealed. On August 28, 2001, the Ninth Circuit Court of Appeals issued a ruling favorable to the FDIC except with respect to the payment of pre-receivership liens based upon delinquent property tax.
The District is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency with respect to parcels in which the FDIC has or obtains an interest, although prohibiting the lien of the FDIC to be foreclosed out at a judicial foreclosure sale would prevent or delay the foreclosure sale.
In the case of Fannie Mae and Freddie Mac, in the event a parcel of taxable property is owned by a federal government entity or federal government sponsored entity, such as Fannie Mae or Freddie Mac, or a private deed of trust secured by a parcel of taxable property is owned by a federal government entity or federal government sponsored entity, such as Fannie Mae or Freddie Mac, the ability to foreclose on the parcel or to collect delinquent Special Taxes may be limited. Federal courts have held that, based on the supremacy clause of the United States Constitution “this Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, anything in the Constitution or Laws of any State to the contrary notwithstanding.” In the absence of Congressional intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest. This means that, unless Congress has otherwise provided, if a federal government entity owns a parcel of taxable property but does not pay taxes and assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments.
Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the District wishesto foreclose on the parcel as a result of delinquent Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Taxes and preserve the federal government’s mortgage interest. For a discussion of risks associated with taxable parcels within the District becoming owned by the federal government, federal government entities or federal government sponsored entities, see “— Insufficiency of Special Tax Revenues.”
The District’s remedies may also be limited in the case of delinquent Special Taxes with respect to parcels in which other federal agencies (such as the Internal Revenue Service and the Drug Enforcement Administration) have or obtain an interest.
Direct and Overlapping Indebtedness
The ability of an owner of property within the District to pay the applicable Special Taxes could be affected by the existence of other taxes and assessments imposed upon taxable parcels. See “THE 1188
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COMMUNITY FACILITIES DISTRICT — Direct and Overlapping Debt” herein. Other public agencies whose boundaries overlap those of the District could impose additional taxes or assessment liens on the property within the District in order to finance public improvements or services to be located or provided inside of or outside of such area. The lien created on the property within the District through the levy of such additional taxes may be on a parity with the lien of the Special Taxes applicable to the property within the District.
The imposition of additional liens on a parity with the Special Taxes may reduce the ability or willingness of property owners to pay the Special Taxes and increase the possibility that foreclosure proceeds will not be adequate to pay delinquent Special Taxes.
Reductions in Property Values
The value of the land within the District is an important factor in determining the investment quality of the Bonds. If a property owner is delinquent in the payment of Special Taxes, the District’s only remedy is to commence foreclosure proceedings in an attempt to obtain funds to pay the Special Taxes. Reductions in property values due to a downturn in the economy, physical events such as earthquakes, wildfires or floods, stricter land use regulations, delays in development or other events will adversely impact the security underlying the Special Taxes. See “THE COMMUNITY FACILITIES DISTRICT — Estimated Value-to-Lien Ratios” for a discussion of the estimated value of the property within the District.
Payment of Special Taxes is not a Personal Obligation of the Property Owners An owner of a taxable parcel is not personally obligated to pay Special Taxes. Rather, Special Taxes are an obligation which is secured only by a lien against the taxable parcel. If the value of a taxable parcel is not sufficient, taking into account other liens imposed by public agencies, to secure fully Special Taxes, the District has no recourse against the property owner.
No Acceleration Provision
The Bonds do not contain a provision allowing for the acceleration of the Bonds in the event of a payment default or other default under the terms of the Bonds or the Fiscal Agent Agreement.
Future Measures and Initiatives
From time to time constitutional initiatives or other initiative measures may be adopted by California voters. The adoption of any such initiative might place limitations on the ability of the State or any political subdivision thereof to increase revenues or to increase appropriations, or might affect the ability of the District to collect the Special Tax.
Proposition 218
An initiative measure commonly referred to as the “Right to Vote on Taxes Act” (the “Initiative”) was approved by the voters of the State of California at the November 5, 1996 general election. The Initiative added Article XIIIC and Article XIIID to the California Constitution. According to the “Title and Summary” of the Initiative prepared by the California Attorney General, the Initiative limits “the authority of local governments to impose taxes and property-related assessments, fees and charges.” The provisions of the Initiative continue to be interpreted by the courts. The Initiative could potentially impact the Special Taxes available to the District to pay the principal of and interest on the Bonds as described below.
Among other things, Section 3 of Article XIII states that “. . . the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or charge.” The MelloRoos Act provides for a procedure which includes notice, hearing, protest and voting requirements to alter the rate and method of apportionment of an existing special tax. However, the Mello-Roos Act prohibits a legislative 1189
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body from adopting any resolution to reduce the rate of any special tax or terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Mello-Roos Act unless such legislative body determines that the reduction or termination of the special tax would not interfere with the timely retirement of that debt. On August 1, 1997, a bill was signed into law by the Governor of the State enacting Government Code Section 5854, which states that:
Section 3 of Article XIIIC of the California Constitution, as adopted at the November 5, 1996, general election, shall not be construed to mean that any owner or beneficial owner of a municipal security, purchased before or after that date, assumes the risk of, or in any way consents to, any action by initiative measure that constitutes an impairment of contractual rights protected by Section 10 of Article I of the United States Constitution.
Accordingly, although the matter is not free from doubt, it is likely that the Initiative has not conferred on the voters the power to repeal or reduce the Special Taxes if such reduction would interfere with the timely retirement of the Bonds.
The interpretation and application of the Initiative will continue to be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such determination or the timeliness of any remedy afforded by the courts. See “SPECIAL RISK FACTORS — Limitations on Remedies.”
Litigation with Respect to Community Facilities Districts Shapiro. The California Court of Appeal, Fourth Appellate District, Division One, issued its opinion in City of San Diego v. Melvin Shapiro (2014) 228 Cal.App.4th 756 (the “San Diego Decision”). The case involved a Convention Center Facilities District (the “CCFD”) established by the City of San Diego (“San Diego”). The CCFD is a financing district much like a community facilities district established under the provisions of the Mello-Roos Act. The CCFD is comprised of all of the real property in San Diego. However, the special tax to be levied within the CCFD was to be levied only on hotel properties located within the CCFD.
The election authorizing the special tax was limited to owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel is located. Thus, the election was not a registered voter election. Such approach to determining who would constitute the qualified electors of the CCFD was modeled after Section 53326(c) of the Mello-Roos Act, which generally provides that, if a special tax will not be apportioned in any tax year on residential property, the legislative body may provide that the vote shall be by the landowners of the proposed district whose property would be subject to the special tax. The Court held that the CCFD special tax election was invalid under the California Constitution because Article XIIIA, Section 4 thereof and Article XIIIC, Section 2 thereof require that the electors in such an election be the registered voters within the district.
Horizon. The Sacramento County Superior Court had issued a tentative ruling in Horizon Capital Investments, LLC v. City of Sacramento et al. (Case No. 34-2017-80002661). That ruling subsequently became the court’s final order. As described below, this case involved an election to approve the levy of a special tax within a community facilities district (“CFD”) formed under the Mello-Roos Act.
In 2017, the City of Sacramento initiated proceedings to form a CFD to finance certain costs to operate and maintain a streetcar line. As permitted by the Mello-Roos Act, the proposed district included non-contiguous parcels of non-residential property. Because there were fewer than 12 registered voters residing within the territory of the proposed CFD, the City Council submitted the special tax proposed to be levied within the proposed CFD to the owners of land within the proposed CFD, as required by the Mello-Roos Act. The proposed special tax received the requisite two-thirds vote in the landowner election. 1190
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Petitioners Horizon Capital Investments, LLC et al. filed a writ of mandate and complaint for reverse validation and declaratory relief. Petitioners argued, and the superior court agreed in its final ruling, that under section 4(a) of article XIII A of the California Constitution (which provides that “Cities, Counties and special districts, by a two-thirds vote of the qualified electors of such district [sic], may impose special taxes on such district…”) the phrase “qualified electors” means the registered voters of the entire City of Sacramento and not just the owners of the property within the boundaries of the proposed CFD. Citing the San Diego Decision, the tentative ruling states that the phrase “qualified electors of the district” refers to the registered voters of the entity imposing the special tax, which in this case was the City of Sacramento. Because the vote within the proposed CFD was by landowners only and not by all registered voters in the City of Sacramento, the final ruling states that the special tax is invalid.
The superior court’s final ruling is not binding upon other courts within the State and does not directly apply to the District, the Special Taxes, or the Bonds. The City of Sacramento did not appeal the superior court’s ruling.
The Special Tax Elections in the District. With respect to the San Diego Decision, the facts of such case show that there were thousands of registered voters within the CCFD (viz., all of the registered voters in San Diego). The elections held in the District had less than 12 registered voters at the time of the election to authorize the Special Taxes. In the San Diego Decision, the court expressly stated that it was not addressing the validity of landowner voting to impose special taxes pursuant to the Mello-Roos Act in situations where there are fewer than 12 registered voters. Thus, by its terms, the court’s holding in the San Diego Decision does not apply to the Special Tax elections in the District. Moreover, Section 53341 of the Mello-Roos Act provides that any “action or proceeding to attack, review, set aside, void or annul the levy of a special tax…shall be commenced within 30 days after the special tax is approved by the voters.” Similarly, Section 53359 of the Mello-Roos Act provides that any action to determine the validity of bonds issued pursuant to the Mello-Roos Act be brought within 30 days of the voters approving the issuance of such bonds. The petitioners in Horizon filed the writ of mandate within 30 days of the landowner election. Voters in the District approved the Special Taxes, in some cases, more than twenty years ago. Based on Sections 53341 and 53359 of the Mello-Roos Act and analysis of existing laws, regulations, rulings and court decisions, the District believes that no successful challenge to their respective Special Taxes being levied in accordance with the Rate and Method may now be brought.
Loss of Tax Exemption
As discussed under the caption “LEGAL MATTERS — Tax Matters” herein, interest on the Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date the Bonds were issued, as a result of future acts or omissions the City or the District in violation of covenants in the Fiscal Agent Agreement or the Fiscal Agent Agreement, respectively. Legislative changes have been proposed in Congress, which, if enacted, would result in additional federal income tax being imposed on certain owners of tax-exempt state or district bonds, such as the Bonds. The introduction or enactment of any of such changes could adversely affect the market value or liquidity of the Bonds. Should such an event of taxability occur, the Bonds are not subject to a special redemption and will remain outstanding until maturity or until redeemed under one of the other redemption provisions contained in the Fiscal Agent Agreement.
Limited Secondary Market
There can be no guarantee that there will be a secondary market for the Bonds, or, if a secondary market exists, that the Bonds can be sold for any particular price. Although the District has committed to provide certain financial information and operating data on an annual basis, there can be no assurance that such information will be available to Beneficial Owners of the Bonds on a timely basis. The failure to provide the required annual information does not give rise to monetary damages but merely an action for specific performance. Occasionally, because of general market conditions, lack of current information, the absence of a credit rating, or adverse history or economic prospects connected with a particular issue, secondary marketing practices in connection 1191
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with a particular issue are suspended or terminated. Additionally, prices of issues for which a market is being made will depend upon then prevailing circumstances. Such prices could be substantially different from the original purchase price.
Limitations on Remedies
Remedies available to the Owners of the Bonds may be limited by a variety of factors and may be inadequate to assure the timely payment of principal of and interest on the Bonds or to preserve the tax-exempt status of interest on the Bonds.
Bond Counsel has limited its opinion as to the enforceability of the Bonds and of the Fiscal Agent Agreement to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or other similar laws affecting generally the enforcement of creditor’s rights, by equitable principles and by the exercise of judicial discretion and by limitations on remedies against public agencies in the State of California. The lack of availability of certain remedies or the limitation of remedies may entail risks of delay, limitation or modification of the rights of the Owners.
Potential Early Redemption of Bonds from Prepayments or Assessment Bond Proceeds Property owners within the District, including Pulte and any individual property owner, are permitted to prepay their Special Taxes at any time. Such prepayments could also be made from the proceeds of bonds issued by or on behalf of an overlapping special assessment district or community facilities district. Such prepayments will result in a redemption of the Bonds on the Interest Payment Date for which timely notice may be given under the Fiscal Agent Agreement following the receipt of the prepayment. The resulting redemption of Bonds, if any, that were purchased at a price greater than par could reduce the otherwise expected yield on such Bonds. See the caption “THE BONDS — Redemption — Special Mandatory Redemption from Prepayment of Special Taxes and Surplus Funds.”
Cyber Security
The City, like many other public and private entities, relies on a large and complex technology environment to conduct its operations. As a recipient and provider of personal, private, or sensitive information, the City is subject to multiple cyber threats including, but not limited to, hacking, viruses, malware and other attacks on computer and other sensitive digital networks and systems. Entities or individuals may attempt to gain unauthorized access to the City’s digital systems for the purposes of misappropriating assets or information or causing operational disruption and damage. To date, the City has not experienced an attack on its computer operating systems which resulted in a breach of its cybersecurity systems that are in place. However, no assurances can be given that the City’s efforts to manage cyber threats and attacks will be successful or that any such attack will not materially impact the operations or finances of the City.
Impact of Economic Conditions on the Development in the District Certain events and factors which negatively affect the regional, State and national economies could have an adverse effect on the pace at which the current or any future developers in the District can complete the remaining infrastructure and future homes, and demand by, and the ability of individuals to purchase homes within the District. Such events and factors could include rising inflation and interest rates, persistent supply chain issues and global market instability caused by geopolitical events. Any adverse impact of the foregoing and other economic factors on the projects in the District and the real estate market in general cannot be predicted.
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LEGAL MATTERS
Tax Matters
Tax Exemption. At closing, Bond Counsel expects to render an opinion to the District that based on existing statutes, regulations, rulings, and court decisions, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from State of California personal income taxes. Bond Counsel is further of the opinion that interest on the Bonds is not a specific preference item for purposes of the federal individual alternative minimum tax. Bond Counsel observes, however, that interest on the Bonds is included in annual adjusted financial statement income for the purpose of computing the alternative minimum tax imposed on applicable corporations. Bond Counsel expects to deliver an opinion at the time of issuance of the Bonds substantially in the form set forth in Appendix C hereto.
The Code imposes various restrictions, conditions, and requirements relating to the exclusion from gross income for federal income tax purposes of interest on obligations such as the Bonds. The District will covenant to comply with certain restrictions designed to assure that interest on the Bonds will not be included in federal gross income. Failure to comply with these covenants may result in interest on the Bonds being included in federal gross income, possibly from the date of issuance of the Bonds. In addition, the District will make certain representations and covenants in the Fiscal Agent Agreement and the Tax Certificate to be delivered the date of the closing. The opinion of Bond Counsel will assume compliance with all these covenants and representations.
Bond Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the Bonds may affect the value of, or the tax status of interest on, the Bonds. Further, no assurance can be given that pending or future legislation or amendments to the Code will not adversely affect the value of, or the tax status of interest on, the Bonds.
Prospective owners are urged to consult their own tax advisors with respect to proposals to restructure the federal income tax.
If the initial offering price to the public (excluding bond houses and brokers) at which a Bond is sold is less than the amount payable at maturity thereof, then such difference constitutes “original issue discount” for purposes of federal income taxes and State of California personal income taxes. If the initial offering price to the public (excluding bond houses and brokers) at which a Bond is sold is greater than the amount payable at maturity thereof, then the excess of the tax basis of a purchaser of such Bond (other than a purchaser who holds such Bond as inventory, stock in trade, or for sale to customers in the ordinary course of business) over the principal amount of such Bond constitutes “original issue premium” for purposes of federal income taxes and State of California personal income taxes.
Original issue discount is excludable from gross income for federal income tax purposes and exempt from State of California personal income taxes to the same extent as the interest on the Bonds. Further, such original issue discount accrues actuarially on a constant interest rate basis over the term of each such Bond and the basis of such Bond acquired at such initial offering price by an initial purchaser of each such Bond will be increased by the amount of such accrued discount. The Code contains certain provisions relating to the accrual of original issue discount in the case of purchasers of the Bonds who purchase such Bonds after the initial offering of a substantial amount thereof. Owners who do not purchase such Bonds in the initial offering at the initial offering prices should consult their own tax advisors with respect to the tax consequences of ownership of such Bonds. All holders of such Bonds should consult their own tax advisors with respect to the allowance of a deduction for any loss on a sale or other disposition to the extent that calculation of such loss is based on accrued original issue discount.
Original issue premium is amortized for federal income tax purposes and State of California personal income taxes over the term of such Bond based on the purchaser’s yield to maturity in such Bond, except that in the case of such Bond callable prior to its stated maturity, the amortization period and the yield may be required to be determined on the basis of an earlier call date that results in the lowest yield on such Bond. A purchaser of such Bond is required to decrease his or her adjusted basis in such Bond by the amount of bond premium 1193
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attributable to each taxable year in which such purchaser holds such Bond. The amount of bond premium attributable to a taxable year is not deductible for federal income tax purposes. Purchasers of such Bonds should consult their tax advisors with respect to the precise determination for federal income tax purposes of the amount of bond premium attributable to each taxable year and the effect of bond premium on the sale or other disposition of such Bond and with respect to the state and local tax consequences of owning and disposing of such Bond.
Certain agreements, requirements, and procedures contained or referred to in the Fiscal Agent Agreement and other relevant documents may be changed and certain actions may be taken or omitted under the circumstances and subject to the terms and conditions set forth in those documents, upon the advice or with the approving opinion of nationally recognized bond counsel. Bond Counsel expresses no opinion as to any Bond or the interest payable with respect thereto if any change occurs or action is taken or omitted upon the advice or approval of counsel other than Bond Counsel.
Although Bond Counsel has rendered an opinion that interest on the Bonds is excluded from federal gross income under Section 103 of the Code and is exempt from current State of California personal income taxes, the ownership or disposition of the Bonds and the accrual or receipt of interest on the Bonds may otherwise affect an Owner’s State, local, or federal tax liability. The nature and extent of these other tax consequences will depend upon each Owner’s particular tax status and the Owner’s other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences. Bond Counsel’s opinion is rendered as of its date and Bond Counsel assumes no obligation to update its opinion.
Future rulings, court decisions, legislative proposals, if enacted into law, or clarification of the Code may cause interest on the Bonds to be subject, directly or indirectly, to federal income taxation, or otherwise prevent Owners from realizing the full current benefit of the tax status of such interest. There can be no assurance that such future rulings, court decisions, legislative proposals, if enacted into law, or clarification of the Code enacted or proposed after the date of issuance of the Bonds will not have an adverse effect on the tax exempt status or market price of the Bonds.
The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatment of the Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service (“IRS”) or the courts.
Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the District or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS. The District will covenant, however, to comply with the requirements of the Code. Unless separately engaged, Bond Counsel is not obligated to defend the District or the Beneficial Owners regarding the tax-exempt status of the Bonds in the event of an audit examination by the IRS. Under current procedures, parties other than the District and their appointed counsel, including the Beneficial Owners, would have little, if any, right to participate in the audit examination process. Moreover, because achieving judicial review in connection with an audit examination of tax-exempt bonds is difficult, obtaining an independent review of IRS positions with which the District legitimately disagrees may not be practicable. Any action of the IRS, including but not limited to selection of the Bonds for audit, or the course or result of such audit, or an audit of bonds presenting similar tax issues, may affect the market price for, or the marketability of, the Bonds, and may cause the District or the Beneficial Owners to incur significant expense.
Absence of Litigation
The District will certify at the time the Bonds are issued that no litigation is pending or threatened concerning the validity of the Bonds and that no action, suit or proceeding is known by the District to be pending against the District that would restrain or enjoin the delivery of the Bonds, or contest or affect the validity of the Bonds or any proceedings of the District taken with respect to the Bonds. 1194
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Legal Opinion
Certain proceedings in connection with the issuance of the Bonds are subject to the approval as to their legality of Aleshire & Wynder, LLP, Irvine, California, Bond Counsel for the District in connection with the issuance of the Bonds. The opinion of Bond Counsel approving the validity of the Bonds substantially in the form attached as Appendix C hereto will be attached to each Bond. Bond Counsel’s employment is limited to a review of legal procedures required for the approval of the Bonds and to rendering an opinion as to the validity of the Bonds and the exemption of interest on the Bonds from income taxation. Bond Counsel expresses no opinion to the Owners of the Bonds as to the accuracy, completeness or fairness of this Official Statement or other offering materials relating to the Bonds and expressly disclaims any duty to do so.
Payment of the fees of Disclosure Counsel, the Municipal Advisor, Underwriter’s Counsel and the Underwriter is contingent upon issuance of the Bonds.
MISCELLANEOUS
No Rating
The District has not made and does not contemplate making application to any rating agency for the assignment of a rating of the Bonds.
Underwriting
The Bonds are being purchased by Oppenheimer & Co. Inc. (the “Underwriter”) at a purchase price of $_____ (representing the par amount of the Bonds, less an Underwriter’s discount of $_____ and plus original issue premium of $_____).
The purchase contract relating to the Bonds between the District and the Underwriter provides that all Bonds will be purchased if any are purchased, and that the obligation to make such purchase is subject to certain terms and conditions set forth in said purchase contract, including, but not limited to, the approval of certain legal matters by counsel.
Continuing Disclosure
The District. Pursuant to a Continuing Disclosure Agreement, the District will agree to provide, or cause to be provided, through the Electronic Municipal Market Access system (“EMMA”) maintained by the Municipal Securities Rulemaking Board (or with such other entity as is designated or authorized under Rule 15c2-12 adopted by the Securities and Exchange Commission) certain annual financial information and operating data. The Annual Report to be filed by the District will include audited financial statements of the City, and additional financial and operating data concerning the District as set forth in Section 4 of the Continuing Disclosure Agreement attached hereto as Appendix D.
The Continuing Disclosure Agreement will inure solely to the benefit of any Dissemination Agent, the Underwriter and Owners or Beneficial Owners from time to time of the Bonds. A default under the Continuing Disclosure Agreement is not a default under the Fiscal Agent Agreement and the sole remedy following a default is an action to compel specific performance by the District with the terms of the Continuing Disclosure Agreement.
[The City and its related governmental entities (such as the Perris Joint Powers Authority (the “Authority”), the Successor Agency to the Redevelopment Agency of the City of Perris (the “Successor Agency”), certain community facilities districts formed by the City and the Perris Public Financing Authority (the “PPFA”) have previously entered into disclosure undertakings under Rule 15c2-12 in connection with the issuance of long-term obligations. Compliance with such undertakings has been the responsibility of City staff. 1195
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During the last five years the City, the Authority, the Successor Agency, certain of the City’s community facilities districts and the PPFA failed to comply in certain respects with continuing disclosure undertakings related to outstanding bonded indebtedness. The failures to comply include (i) the City, the Successor Agency, the Authority and the PPFA failed to file audited financial statements by the required dates for the fiscal years ending June 30, 2020 through 2024; and (ii) the PPFA timely filed an annual report for the fiscal year ending June 30, 2019 with respect to the PPFA’s Tax Allocation Revenue Refunding Bonds, 2015 Series A and Tax Allocation Subordinate Revenue Refunding Bonds, 2015 Series B; however, such report did not include all required information, and the PPFA filed a supplemental annual report with the required information approximately 29 days after the due date for the annual report. The audited financial statements for the fiscal year ending June 30, 2021 were filed on March 21, 2022 (approximately 80 days late for certain continuing disclosure undertakings), the audited financial statements for the fiscal year ending June 30, 2022 were filed on August 22, 2023 (approximately 234 days late for certain continuing disclosure undertakings), the audited financial statements for the fiscal year ending June 30, 2023 were filed on September 23, 2024 (approximately 267 days late for certain continuing disclosure undertakings), the audited financial statements for the fiscal year ending June 30, 2024 were filed on September 19, 2025 (approximately 261 days late for certain continuing disclosure undertakings), and the audited financial statements for the fiscal year ending June 30, 2025 were filed on March 10, 2026 (approximately 69 days late for certain continuing disclosure undertakings).] In order to promote compliance by the Authority, the PPFA, the Successor Agency and the City and its community facilities districts with continuing disclosure undertakings in the future, the City has continued to retain Willdan Financial Services to serve as the dissemination agent for its outstanding bonded indebtedness which are subject to the Rule.
The Master Developer. The Underwriter does not consider the Master Developer to be an “obligated person” with respect to the Bonds for purposes of the Rule. Notwithstanding the foregoing, to provide updated information with respect to the development within the District, the Master Developer will execute a continuing disclosure certificate (the “Master Developer Continuing Disclosure Certificate”) pursuant to which it will covenant to provide semiannual reports, commencing _______________, until satisfaction of certain conditions set forth in the Master Developer Continuing Disclosure Certificate. The semiannual reports to be provided by the Master Developer will contain updates regarding the development within the District as outlined in Section ___ of the Master Developer Continuing Disclosure Certificate attached hereto as Appendix E. In addition to its semiannual reports, the Master Developer will agree to provide notices of certain events set forth in the Master Developer Continuing Disclosure Certificate.
The Master Developer’s obligations under the Master Developer Continuing Disclosure Certificate will terminate upon the earliest to occur of: (a) the legal defeasance, prior redemption or payment in full of all the Bonds; or (b) at such time as __________.
Pending Legislation
The District is not aware of any significant pending legislation which would have material adverse consequences on the Bonds or the ability of the District to pay the principal of and interest on the Bonds when due.
Additional Information
References are made herein to certain documents and reports which are brief summaries thereof which do not purport to be complete or definitive, and reference is made to such documents and reports for full and complete statements of the contents thereof.
Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the District and the purchasers or Owners of any of the Bonds. 1196
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The execution and delivery of this Official Statement has been duly authorized by the District.
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER) OF THE CITY OF
PERRIS
By:
City Manager
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APPENDIX A
SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT 1198
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APPENDIX B
RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
RATE AND METHOD OF APPORTIONMENT FOR
COMMUNITY FACILITIES DISTRICT NO. 2022-2 (PERRIS LOGISTICS CENTER)
OF THE CITY OF PERRIS
A Special Tax shall be levied on all Taxable Property within the boundaries of Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris (“CFD No. 2022-2”) and collected each Fiscal Year commencing in Fiscal Year 2023-24, in an amount determined by the CFD Administrator through the application of the procedures described below. All of the real property within CFD No. 2022-2, unless exempted by law or by the provisions hereof, shall be taxed for the purposes, to the extent, and in the manner herein provided.
1. DEFINITIONS
The terms hereinafter set forth have the following meanings:
“Acre” or “Acreage” means the land area of an Assessor’s Parcel as shown on an Assessor’s Parcel Map, or if the land area is not shown on an Assessor’s Parcel Map, the land area shown on the applicable Final Map. An Acre means 43,560 square feet of land.
“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California. “Acquisition Agreement” means this Acquisition and Funding Agreement, dated July 25, 2023, by and among the City, the Developer, and the IDI Property Owners, as originally executed or as the same may be amended from time to time in accordance with its terms
“Administrative Expenses” means the following actual or reasonably estimated costs related to the administration of CFD No. 2022-2 including, but not limited to: the costs of preparing and computing the Annual Special Tax (whether by the City or designee thereof or both); the costs of collecting the Special Taxes (whether by the City, the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under the Indenture; the costs to the City, CFD No. 2022-2, or any designee thereof complying with arbitrage rebate requirements, including without limitation rebate liability costs and periodic rebate calculations; the costs to the City, CFD No. 2022-2, or any designee thereof complying with disclosure or reporting requirements of the City or CFD No. 2022-2, associated with applicable federal and State laws; the costs associated with preparing Special Tax disclosure statements and responding to public inquiries regarding the Special Taxes; the costs to the City, CFD No. 2022- 2, or any designee thereof related to an appeal of the Special Tax; and the City’s annual administration fees and third party expenses. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 2022-2 for any other administrative purposes of CFD No. 2022-2, including attorney’s fees and other costs related to commencing and pursuing any foreclosure of delinquent Special Taxes. “Annual Special Tax” means the Special Tax actually levied in any Fiscal Year on any Assessor’s Parcel. “Assessor” means the Assessor of the County of Riverside. 1199
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“Assessor’s Parcel” means a lot or parcel shown on an Assessor’s Parcel Map with an assigned Assessor’s Parcel Number.
“Assessor’s Parcel Map” means an official map of the Assessor designating parcels by Assessor’s Parcel Number.
“Assessor’s Parcel Number” means the number assigned to an Assessor’s Parcel by the County for purposes of identification.
“Authorized Fees” means development, impact or other fees imposed by the City as shown on Exhibit C to the Acquisition Agreement.
“Boundary Map” means the map of the boundaries of CFD No. 2022-2 recorded on in the Riverside County Recorder’s Office in Book 91, Pages 29-30, of Maps of Assessments and Community Facilities Districts (instrument number 2023-0160018).
“Bonds” means any bonds or other Debt of CFD No. 2022-2, whether in one or more series, secured by the levy of Special Taxes.
“Calendar Year” means the period commencing January 1 of any year and ending the following December 31. “CFD Administrator” means an authorized representative of the City, or designee thereof, responsible for determining the Special Tax Requirement and for preparing the Annual Special Tax roll. “CFD No. 2022-2” means the Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris.
“City” means the City of Perris, California.
“Council” means the City Council of the City acting as the legislative body of CFD No. 2022-2 under the Act. “County” means the County of Riverside, California.
“Debt” means any binding obligation to pay or repay a sum of money, including obligations in the form of bonds, certificates of participation, long-term leases, loans from government agencies, or loans from banks, other financial institutions, private businesses, or individuals, or long-term contracts. “Debt Service” means for each Fiscal Year, the total amount of principal and interest payable on any Outstanding Bonds during the Calendar Year commencing on January 1 of such Fiscal Year. “Developer” means IDI Logistics, LLC, a Delaware limited liability company, and its successors and assigns. “Exempt Property” means for each Fiscal Year, all Assessor’s Parcels designated as being exempt from Special Taxes pursuant to Section 8 below.
“Facilities” means the facilities described in Exhibit B to the Acquisition Agreement. “Final Map” means a subdivision of property by recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 4285 that creates individual lots for which Building Permits may be issued without further subdivision.
“Fiscal Year” means the period starting on July 1 and ending the following June 30. 1200
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“Indenture” means the indenture, fiscal agent agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same.
“IDI Property Owners” means IDIL Perris North 3, L.P., a Delaware limited partnership, and IDIL Perris Fulfillment Center L.P., a Delaware limited partnership, and/or an affiliated company thereof, and their respective successor and/or assigns.
“Lower Income Households Welfare Exemption Property” means, for each Fiscal Year, an Assessor’s Parcel that is entitled to a welfare exemption under subdivision (g) of Section 214 of the California Revenue and Taxation Code (or any successor statute), as indicated in the County Assessor’s roll finalized as of January 1 of the previous Fiscal Year; provided that such property shall not be classified as Lower Income Households Welfare Exemption Property if debt is outstanding and the property was subject to the Special Tax prior to receiving the exemption, in which case the property shall remain subject to the Special Tax and the Special Tax shall be enforceable against the property.
“Maximum Special Tax” means for each Assessor’s Parcel, the maximum Special Tax, determined in accordance with Sections 3.A and 3.B below, which may be levied in a given Fiscal Year on such Assessor’s Parcel of Taxable Property.
“Outstanding Bonds” means all Bonds, which are deemed to be outstanding under the Indenture. “Prepayment Amount” means the amount required to prepay the Annual Special Tax obligation in full for an Assessor’s Parcel as described in Section 6.A below.
“Proportionately” or “Proportionate” means for Taxable Property, that the ratio of the actual Special Tax levy to the applicable Maximum Special Tax Special Tax is equal for all Assessor’s Parcels of Taxable Property. “Provisional Property” means all Assessor’s Parcels of Public Property, or property that would otherwise be classified as Exempt Property pursuant to the provisions of Section 8, but cannot be classified as Exempt Property because to do so would reduce the Acreage of all Taxable Property below the required minimum Acreage as set forth in Section 8.
“Public Property” means any property within the boundaries of CFD No. 2022-2, which is owned by, or irrevocably offered for dedication to the federal government, the State of California, the County, the City or any other public agency; provided however that any property owned by a public agency and leased to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified in accordance with its use. “Special Tax” means any special tax levied within CFD No. 2022-2 pursuant to the Act and this Rate and Method of Apportionment of Special Tax.
“Special Tax Obligation” means the total obligation of an Assessor’s Parcel of Taxable Property to pay the Special Tax for the remaining life of CFD No. 2022-2.
“Special Tax Requirement” means that amount required in any Fiscal Year to: (i) pay regularly scheduled Debt Service on all Outstanding Bonds; (ii) pay periodic costs on the Outstanding Bonds, including but not limited to, credit enhancement and rebate payments on the Outstanding Bonds; (iii) pay Administrative Fees and Expenses; (iv) pay any amounts required to establish or replenish any reserve funds for all Outstanding Bonds; (v) accumulate funds for deposit in the Improvement Fund to pay directly or reimburse Developer for acquisition or construction of Facilities or Authorized Fees; and (vi) pay for reasonably anticipated delinquent Special Taxes based on the delinquency rate for Special Taxes levied in the previous Fiscal Year; less (vii) a credit for funds available to reduce the Annual Special Tax levy, as determined by the CFD Administrator pursuant to the Indenture.
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“State” means the State of California.
“Taxable Property” means all of the Assessor’s Parcels within the boundaries of CFD No. 2022- 2, which are not exempt from the levy of the Special Tax pursuant to law or Section 8 below. “Trustee” means the trustee or fiscal agent under the Indenture.
2. LAND USE CLASSIFICATION
Each Fiscal Year, beginning with Fiscal Year 2023-24, each Assessor’s Parcel within CFD No. 2022-2 shall be classified as Taxable Property, Exempt Property or Provisional Property and all such Taxable Property shall be subject to the levy of Special Taxes in accordance with this Rate and Method of Apportionment of Special Tax determined pursuant to Sections 3 and 4 below.
3. SPECIAL TAX RATES
A. Maximum Special Tax for Taxable Property
The Maximum Special Tax applicable to an Assessor’s Parcel classified as Taxable Property commencing in Fiscal Year 2023-24 shall be determined pursuant to Table 1 below.
Table 1
Maximum Special Tax Rates
Land Use Type Maximum Special Tax
per Acre
Taxable Property $4,400
Each July 1, commencing July 1, 2024, the Maximum Special Tax rates for Taxable Property shall be increased by two percent (2%) of the amount in effect the prior Fiscal Year.
B. Maximum Special Tax for Provisional Property
The Maximum Special Tax for Provisional Property commencing in Fiscal Year 2023-24 shall be $4,400 per Acre for property. Each July 1, commencing July 1, 2024, the Maximum Special Tax rates for Provisional Property shall be increased by two percent (2%) of the amount in effect the prior Fiscal Year.
4. METHOD OF APPORTIONMENT
For each Fiscal Year, commencing Fiscal Year 2023-24, the CFD Administrator shall levy the Special Tax on all Taxable Property in accordance with the following steps:
Step 1: The Special Tax shall be levied Proportionately on each Assessor’s Parcel of Taxable Property in an amount up to 100% of the applicable Maximum Special Tax as necessary to satisfy the Special Tax Requirement;
Step 2: If additional monies are needed to satisfy the Special Tax Requirement after the first step has been completed, then the Special Tax shall be levied Proportionately on each Assessor’s Parcel of Provisional Property.
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5. COLLECTION OF SPECIAL TAXES
Collection of the Annual Special Tax shall be made by the County in the same manner as ordinary ad valorem property taxes are collected and the Annual Special Tax shall be subject to the same penalties and the same lien priority in the case of delinquency as ad valorem taxes; provided, however, that the Council may provide for (i) other means of collecting the Special Tax, including direct billings thereof to the property owners; and (ii) judicial foreclosure of delinquent Annual Special Taxes.
6. PREPAYMENT OF SPECIAL TAX OBLIGATION
A. Prepayment in Full
Property owners may prepay and permanently satisfy the Special Tax Obligation by a cash settlement with the City as permitted under Government Code Section 53344. The following definitions apply to this Section 6:
“CFD Public Facilities Costs” means $21,000,000 or such number that (i) shall be determined by the CFD Administrator as sufficient to acquire or construct the facilities to be financed under the Act and financing program for CFD No. 2022-2, or (ii) shall be determined by the Council concurrently with a covenant that it will not issue any more Bonds (except refunding bonds). “Future Facilities Costs” means the CFD Public Facilities Costs minus (i) costs previously paid from the Improvement Fund to acquire or construct the facilities, (ii) monies currently on deposit in the Improvement Fund, and (iii) monies currently on deposit in an escrow or other designated fund that are expected to be available to finance CFD Public Facilities Costs. “Improvement Fund” means the fund (regardless of its name) established pursuant to the Indenture (and referenced in the Acquisition Agreement) or a separate account maintained by the City to hold funds, which are currently available for expenditure to acquire or construct the Facilities or pay Authorized Fees to be funded by CFD No. 2022-2.
“Outstanding Bonds” means all Previously Issued Bonds, which remain outstanding as of the first interest and/or principal payment date following the current Fiscal Year excluding Bonds to be redeemed at a later date with proceeds of prior Special Tax prepayments. “Previously Issued Bonds” means all Bonds that have been issued prior to the date of prepayment.
The Special Tax Obligation applicable to an Assessor’s Parcel of Taxable Property may be prepaid and the obligation to pay the Special Tax for such Assessor’s Parcel permanently satisfied as described herein, provided that a prepayment may be made with respect to a particular Assessor’s Parcel only if there are no delinquent Special Taxes with respect to such Assessor’s Parcel at the time of prepayment or the delinquent special taxes are paid off concurrently with the prepayment to the satisfaction of the CFD Administrator. An owner of an Assessor’s Parcel eligible to prepay the Special Tax Obligation shall provide the CFD Administrator with written notice of intent to prepay, and designate or identify the company or agency that will be acting as the escrow agent, if any. The CFD Administrator shall provide the owner with a statement of the Prepayment Amount for such Assessor’s Parcel within thirty (30) days of the request, and may charge a reasonable fee for providing this service. Prepayment must be made at least 60 days prior to any redemption date provided for in the Indenture with respect to CFD No. 2022-2 Bonds to be redeemed with the proceeds of such prepaid Special Taxes, unless a shorter period is acceptable to the Trustee and the City.
The Prepayment Amount (defined below) shall be calculated for each applicable Assessor’s Parcel or group of Assessor’s Parcels as summarized below (capitalized terms as defined below):
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Bond Redemption Amount
plus Redemption Premium
plus Future Facilities Prepayment Amount
plus Defeasance Amount
plus Prepayment Administrative Fees and Expenses
less Reserve Fund Credit
less Capitalized Interest Credit
Total: equals Prepayment Amount
As of the proposed date of prepayment, the Prepayment Amount (defined in Step 14 below) shall be calculated as follows:
Step No.:
1. Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.
2. For Assessor’s Parcels of Taxable Property, determine the Maximum Special Tax.
3. Divide the Maximum Special Tax computed pursuant to paragraph 2 by the total expected Maximum Special Tax revenue for CFD No. 2022-2, excluding any Assessor’s Parcels for which the Special Tax Obligation has been previously prepaid.
4. Multiply the quotient computed pursuant to paragraph 3 by the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid for all applicable parcels and round that amount up to the nearest $5,000 increment (the “Bond Redemption Amount”).
5. Multiply the Bond Redemption Amount computed pursuant to paragraph 4 by the applicable redemption premium (expressed as a percentage), if any, on the Outstanding Bonds to be redeemed at the first available call date (the “Redemption Premium”).
6. Compute the Future Facilities Costs.
7. Multiply the quotient computed pursuant to paragraph 3 by the amount determined pursuant to paragraph 6 to compute the amount of Future Facilities Costs to be prepaid (the “Future Facilities Prepayment Amount”).
8. Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the expected redemption date for the Outstanding Bonds which, depending on the Indenture, may be as early as the next interest payment date, but the redemption date may be any date determined by the CFD Administrator as convenient and appropriate, provided such date is permitted by the Indenture.
9. Compute the amount the CFD Administrator reasonably expects to derive from the reinvestment of the Prepayment Amount less the Future Facilities Prepayment Amount and the Prepayment Administrative Fees from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the prepayment.
10. Subtract the amount computed in paragraph 9 from the amount computed in paragraph 8 (the “Defeasance Amount”).
11. Calculate the administrative fees and expenses of CFD No. 2022-2, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of 1204
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redeeming CFD No. 2022-2, and the costs of recording any notices to evidence the prepayment and the redemption (the “Prepayment Administrative Fees”).
12. If reserve funds for the Outstanding Bonds, if any, are at or above 100% of the reserve requirement (as defined in the Indenture) on the prepayment calculation date, a reserve fund credit shall be calculated as a reduction in the applicable reserve fund for the Outstanding Bonds to be redeemed pursuant to the prepayment (the “Reserve Fund Credit”). No Reserve Fund Credit shall be granted if, after the Prepayment Amount is calculated, reserve funds are below 100% of the reserve requirement.
13. If any capitalized interest for the Outstanding Bonds will not have been expended at the time of the first interest and/or principal payment following the current Fiscal Year, a capitalized interest credit shall be calculated by multiplying the quotient computed pursuant to paragraph 3 by the expected balance in the capitalized interest fund after such first interest and/or principal payment (the “Capitalized Interest Credit”).
14. The amount to prepay the Special Tax Obligation is equal to the sum of the amounts computed pursuant to paragraphs 4, 5, 7, 10, and 11, less the amounts computed pursuant to paragraphs 12 and 13 (the “Prepayment Amount”).
15. From the Prepayment Amount, the sum of the amounts computed pursuant to paragraphs 4, 5, and 10, less the amounts computed pursuant to paragraphs 12 and 13 shall be deposited into the appropriate fund as established under the Indenture and be used to retire Outstanding Bonds or make Debt Service payments. The amount computed pursuant to paragraph 7 shall be deposited into the Improvement Fund. The amount computed pursuant to paragraph 11 shall be retained by CFD No. 2022-2.
The Prepayment Amount may be sufficient to redeem an amount other than a $5,000 increment of CFD No. 2022-2 Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be retained in the appropriate fund established under the Indenture to redeem CFD No. 2022-2 Bonds to be used with the next prepayment of CFD No. 2022-2 Bonds.
The CFD Administrator will confirm that all previously levied Special Taxes have been paid in full. With respect to any Assessor’s Parcel for which the Special Tax Obligation is prepaid in full, once the CFD Administrator has confirmed that all previously levied Special Taxes have been paid, the Council shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of the Special Tax and the release of the Special Tax lien on such Assessor’s Parcel, and the obligation of the owner of such Assessor’s Parcel to pay the Special Tax shall cease.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the aggregate amount of Maximum Special Taxes less Administrative Expenses that may be levied on Taxable Property, respectively, after the proposed prepayment is at least 1.1 times the Debt Service on all Outstanding Bonds in each Fiscal Year.
B. Partial Prepayment
The Special Tax on an Assessor’s Parcel of Taxable Property may be partially prepaid. The amount of the prepayment shall be calculated as in Section 6.A.; except that a partial prepayment shall be calculated according to the following formula:
PP = (PE-A) x F+A
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These terms have the following meaning:
PP = the partial prepayment
PE = the Prepayment Amount calculated according to Section 6.A F = the percentage by which the owner of the Assessor’s Parcel(s) is partially prepaying the Special Tax Obligation
A = the Prepayment Administrative Fees and Expenses from Section 6.A The owner of any Assessor’s Parcel who desires such partial prepayment shall notify the CFD Administrator of (i) such owner’s intent to partially prepay the Special Tax Obligation, (ii) the percentage by which the Special Tax Obligation shall be prepaid, and (iii) the company or agency that will be acting as the escrow agent, if any. The CFD Administrator shall provide the owner with a statement of the amount required for the partial prepayment of the Special Tax Obligation for an Assessor’s Parcel within sixty (60) days of the request and may charge a reasonable fee for providing this service.
With respect to any Assessor’s Parcel that is partially prepaid, the City shall (i) distribute the funds remitted to it according to Section 6.A., and (ii) indicate in the records of CFD No. 2022-2 that there has been a partial prepayment of the Special Tax Obligation and that a portion of the Special Tax with respect to such Assessor’s Parcel, equal to the outstanding percentage (1.00 - F) of the Maximum Special Tax, shall continue to be levied on such Assessor’s Parcel.
Notwithstanding the foregoing, no partial prepayment shall be allowed unless the aggregate amount of Maximum Special Taxes less Administrative Expenses that may be levied on Taxable Property, respectively, after the proposed partial prepayment is at least 1.1 times the Debt Service on all Outstanding Bonds in each Fiscal Year.
7. TERM OF SPECIAL TAX
The Special Tax shall be levied as long as necessary to meet the Special Tax Requirement for a period not to exceed fifty (50) Fiscal Years commencing with Fiscal Year 2023-24, provided however that the Special Tax will cease to be levied in an earlier Fiscal Year if the CFD Administrator has determined that all required interest and principal payments on CFD No. 2022-2 Bonds have been paid and the City has not instructed the CFD Administrator to continue levying.
8. EXEMPTIONS
The CFD Administrator shall classify as Exempt Property (i) Assessor’s Parcels of Public Property, or (ii) Assessor’s Parcels which are used as places of worship and are exempt from ad valorem property taxes because they are owned by a religious organization, (iii) Assessor’s Parcels with public or utility easements making impractical their utilization for other than the purposes set forth in the easement, and (iv) Lower Income Households Welfare Exemption Property, provided that no such classification would reduce the sum of all Taxable Property in CFD No. 2022-2 to less than 327.658 Acres. Assessor’s Parcels which cannot be classified as Exempt Property because such classification would reduce the sum of all Taxable Property in CFD No. 2022-2 to less than 327.658 Acres shall be classified as Provisional Property and will continue to be subject to the CFD No. 2022-2 Special Taxes accordingly.
Tax exempt status for the purpose of this paragraph will be assigned by the CFD Administrator in the chronological order in which property becomes eligible for classification as Exempt Property.
If the use of an Assessor’s Parcel of Exempt Property changes so that such Assessor’s Parcel is no longer classified as one of the uses set forth in the first paragraph of Section 8 above that would make such Assessor’s Parcel eligible to be classified as Exempt Property, such Assessor’s Parcel shall cease to be classified as Exempt Property and shall be deemed to be Taxable Property. 1206
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Notwithstanding the above, the CFD Administrator will interpret any ambiguities in the provisions of this RMA to facilitate the levy of $1,441,695.20 on the Taxable Property within CFD No. 2022-2 for Fiscal Year 2023-24.
9. APPEALS
Any landowner who pays the Special Tax and claims the amount of the Special Tax levied on his or her Assessor’s Parcel is in error shall first consult with the CFD Administrator regarding such error not later than twelve (12) months after first having paid the first installment of the Special Tax that is disputed.
If following such consultation the CFD Administrator determines that an error has occurred, then the CFD Administrator shall take any of the following actions, in order of priority, in order to correct the error:
(i) Amend the Special Tax levy on the landowner’s Assessor’s Parcel(s) for the current Fiscal Year prior to the payment date,
(ii) Require the CFD to reimburse the landowner for the amount of the overpayment to the extent of available CFD funds, or
(iii) Grant a credit against, eliminate or reduce the future Special Taxes on the landowner’s Assessor’s Parcel(s) in the amount of the overpayment.
If following such consultation and action by the CFD Administrator the landowner believes such error still exists, such person may file a written notice of appeal with the City Council. Upon the receipt of such notice, the City Council or designee may establish such procedures as deemed necessary to undertake the review of any such appeal. If the City Council or designee determines an error still exists, the CFD Administrator shall take any of the actions described as (i), (ii) and (iii) above, in order of priority, in order to correct the error.
The City Council or designee thereof shall interpret this Rate and Method of Apportionment of Special Tax for purposes of clarifying any ambiguities and make determinations relative to the administration of the Special Tax and any landowner appeals. The decision of the City Council or designee shall be final. 1207
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APPENDIX C
FORM OF BOND COUNSEL OPINION
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APPENDIX D
FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT
This Continuing Disclosure Agreement (the “Disclosure Agreement”), dated as of October 1, 2026, is executed and delivered by the Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris (the “District”) and Willdan Financial Services, as dissemination agent, in connection with the issuance and delivery of Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris Special Tax Bonds, 2026 Series (the “Bonds”). The Bonds are being issued pursuant to a resolution adopted by the Board of Directors of the District on September 29, 2026 and a Fiscal Agent Agreement by and between the District and U.S. Bank Trust Company, National Association, as fiscal agent, dated as of October 1, 2026 (the “Fiscal Agent Agreement”). The District covenants as follows:
SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Authority, 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 (as defined below).
SECTION 2. Definitions. In addition to the definitions set forth in the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Agreement 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 Agreement.
“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 Perris, California.
“Disclosure Representative” shall mean the City Manager, Assistant City Manager or Finance Director of the City of Perris (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, Willdan Financial Services, or any successor Dissemination Agent designated in writing by the District which has filed with the then current Dissemination Agent a written acceptance of such designation.
“District” shall mean Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris.
“Financial Obligation” means a: (A) debt obligation; (B) derivative instrument entered into in connection with, or pledged as security or a source of payment for, an existing or planned debt obligation; or (C) guarantee of (A) or (B). The term “Financial Obligation” does not include municipal securities as to which a final official statement has been provided to the Municipal Securities Rulemaking Board consistent with the Rule.
“Listed Events” shall mean any of the events listed in Section 5(a) of this Disclosure Agreement. “Owners” shall mean the registered owners of the Bonds as set forth in the registration books maintained by the Trustee.
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“Participating Underwriter” shall mean Oppenheimer & Co. Inc., as the original underwriter of the Bonds required to comply with the Rule in connection with the offering of the Bonds. “Rate and Method of Apportionment” means the Rate and Method of Apportionment of Special Taxes for the District.
“Repository” shall mean the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board, which can be found at http://emma.msrb.org/, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future.
“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. “Special Tax” shall mean the special tax levied on property within the District in accordance with the Rate and Method of Apportionment for the District.
“Tax-exempt” shall mean that interest on the Bonds is excluded from gross income for federal income tax purposes, whether or not such interest is includable as an item of tax preferences or otherwise includable directly or indirectly for purposes of calculating any other tax liability, including any alternative minimum tax or environmental tax.
SECTION 3. Provision of Annual Reports.
(a) Not later than March 1 immediately following the end of the District’s fiscal year, commencing March 1, 2027, the District shall, provide or shall cause the Dissemination Agent to provide, to the Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement; provided, however, that the first Annual Report due March 1, 2027 shall consist solely of the Official Statement. 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 Agreement; provided that the audited financial statements of the City, if any are prepared, 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.
An Annual Report shall be provided at least annually notwithstanding any fiscal year longer than 12 calendar months. The District’s fiscal year (“Fiscal Year”) is currently effective from July 1 to the immediately succeeding June 30 of the following year. The District will promptly notify the Repository or the Municipal Securities Rulemaking Board and the Dissemination Agent of a change in the fiscal year dates. (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 to the Repository, the District shall provide the Annual Report to the Dissemination Agent. If by fifteen (15) Business Days prior to such date the Dissemination Agent has not received a copy of the Annual Report, the Dissemination 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 District is the Dissemination Agent and the District is unable to provide to the Repository an Annual Report by the date required in subsection (a), the District shall, in a timely manner, send a notice to the Municipal Securities Rulemaking Board and the Repository, if any, in substantially the form attached to this 1210
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Disclosure Agreement as Exhibit A. 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 the Repository by the date required in subsection (a), the Dissemination Agent shall, in a timely manner, send a notice to the Repository, in substantially the form attached as Exhibit A.
(d) The Dissemination Agent shall upon receipt, promptly file each Annual Report received under Section 3(b) with the Repository.
SECTION 4. Content of Annual Reports. The District’s Annual Report shall contain or include by reference:
(a) Financial Statements. The audited financial statements of the City for the most recent fiscal year of the City then ended, if such audited financial statements are prepared. If the audited financial statements (if prepared) are not available by the time the Annual Report is required to be filed, the Annual Report shall contain any unaudited financial statements of the District and the City, in each case, if any are prepared, in a format similar to the audited financial statements, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. Audited financial statements of the District and the City, in each case if any are prepared, shall be audited by such auditor as shall then be required or permitted by State law or the Fiscal Agent Agreement. Audited financial statements (if prepared) shall be prepared in accordance with generally accepted accounting principles as prescribed for governmental units by the Governmental Accounting Standards Board; provided, however, that the District and the City may from time to time, if required by federal or state legal requirements, modify the basis upon which its financial statements are prepared. In the event that the District or the City shall modify the basis upon which their respective financial statements, if any, are prepared, the District shall provide a notice of such modification to the Repository, including a reference to the specific federal or state law or regulation specifically describing the legal requirements for the change in accounting basis. If no financial statements of the District and the City are prepared, then none shall be included on the Annual Report.
The City’s audited financial statements are provided solely to comply with the Securities Exchange Commission staff’s interpretation of the Rule. The Bonds are special obligations of the District payable solely from and secured solely by the Revenues and Redemption Revenues and other funds and accounts pledged therefor in the Fiscal Agent Agreement. The Bonds are not a debt or liability of the City, the State of California or any political subdivisions thereof other than the District to the limited extent described in the Official Statement.
(b) Financial and Operating Data. The Annual Report shall contain or incorporate by reference the following information:
(i) the current Fiscal Year’s total assessed valuation (per the County of Riverside Assessor’s records) of all parcels within the District subject to the Special Tax for the District, showing the assessed valuation for land value and improvement value, and total assessed value for the District. (ii) an update of the estimated assessed value-to-lien ratio for the District based upon the then-outstanding principal amount of the applicable series of District Bonds, the most recent Special Tax levy and the assessed values of property within the District for the current fiscal year; (iii) for the current Fiscal Year, the actual amount of the Special Tax levy and the maximum Special Tax levy pursuant to the Rate and Method of Apportionment within the District; (iv) with respect to delinquencies within the District; (a) The Special Tax delinquency rate as of the September 30 next preceding the Annual Report Date for all parcels within the District on which the Special Taxes are levied; 1211
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(b) The status of foreclosure proceedings for any parcels within the District on which the Special Taxes are levied and a summary of the results of any foreclosure sales as of the September 30 next preceding the Annual Report Date; and
(c) The identity of any property owner representing more than five percent (5%) of the annual Special Tax levy who is delinquent in payment of such Special Taxes as of the September 30 next preceding the Annual Report Date;
(v) the principal amount of any prepayments of the Special Tax for the District as of the date the applicable District transmitted the Special Tax amounts for the District to the County of Riverside for inclusion on the secured tax roll for the then current Fiscal Year (which is currently no later than August 10) and a description of any parcels for which the Special Taxes have been prepaid in the Fiscal Year for which the Annual Report is being prepared;
(vi) a current debt service schedule for the outstanding Bonds and the principal amount of the Bonds outstanding as of September 30 for the most recent Fiscal Year; (vii) any changes to the Rate and Method of Apportionment for the District of the Special Taxes approved or submitted to the qualified electors for approval prior to the filing of the Annual Report; and (viii) the balance in the Reserve Account (as defined in each Fiscal Agent Agreement) held under each Fiscal Agent Agreement (and a statement of the Reserve Requirement (as defined in each Fiscal Agent Agreement) for such Reserve Account) as of September 30 of the current Fiscal Year.
In addition to any of the information expressly required to be provided under paragraphs (a) or (b) of this Section, the District shall provide such further information, if any, as may be necessary to make the specifically required statements set forth in clauses (i) to (viii) under paragraph (b) of this Section, in the light of the circumstances under which they were made, not misleading. (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 the Repository or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Repository. The District shall clearly identify each such other document so included by reference.
SECTION 5. Reporting of Significant Events.
(a) The District shall notify the Dissemination Agent not more than eight (8) Business Days after the following events, and the Dissemination Agent shall file a notice with the Repository not more than ten (10) Business Days after the following events:
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; 1212
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6. defeasances;
7. tender offers;
8. bankruptcy, insolvency, receivership or similar proceedings;
9. ratings changes;
10. default, event of acceleration, termination event, modification of terms or other similar events under the terms of a Financial Obligation of the District, any of which reflect financial difficulties.
(b) Additionally, the District shall provide the Dissemination Agent, and the Dissemination Agent shall promptly file with the Repository, notice of the occurrence of any of the following events with respect to the Bonds, if material:
1. The consummation of a merger, consolidation or acquisition involving an obligated person or sale of all or substantially all of the assets of the obligated persons or their person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination; of a definitive agreement relating to any such actions, other than pursuant to its term;
2. appointment of a successor or additional fiscal agent or the change of the name of a fiscal agent;
3. non-payment 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 District, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a Financial Obligation of the District, any of which affect security holders, if material (c) The District hereby agrees that the undertaking set forth in this Disclosure Agreement is the responsibility of the District and the Dissemination Agent shall not be responsible for determining whether the District’s instructions to the Dissemination Agent under this Section 5 comply with the requirements of the Rule.
SECTION 6. Termination of Reporting Obligation. The obligations of the District and the Dissemination Agent under this Disclosure Agreement 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(a).
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 the Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be Willdan Financial Services. The Dissemination Agent may resign by providing (i) thirty days written notice to the District, and (ii) upon appointment of a new Dissemination Agent hereunder.
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SECTION 8. Amendment.
(a) This Disclosure Agreement may be amended, by written agreement of the parties, without the consent of the Owners, if all of the following conditions are satisfied: (1) such amendment 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) this Disclosure Agreement as so amended would have complied with the requirements of the Rule as of the date of this Disclosure Agreement, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances, (3) the District shall have delivered to the Dissemination Agent an opinion of a nationally recognized bond counsel or counsel expert in federal securities laws, addressed to the District and the Participating Underwriter, to the same effect as set forth in clause (2) above, (4) the District shall have delivered to the Dissemination Agent an opinion of nationally recognized bond counsel or counsel expert in federal securities laws, addressed to the District, to the effect that the amendment does not materially impair the interests of the Owners or Beneficial Owners, or such amendment shall have been approved by the Owners in the same manner as an amendment to the Fiscal Agent Agreement, and (5) the District shall have delivered copies of such opinion and amendment to the Repository and the Participating Underwriter. (b) This Disclosure Agreement also may be amended by written agreement of the parties upon obtaining consent of Owners in the same manner as provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of the Owners of the Bonds; provided that the conditions set forth in Section 8(a)(1), (2) and (3) have been satisfied.
(c) To the extent any amendment to this Disclosure Agreement results in a change in the type of financial information or operating data provided pursuant to this Disclosure Agreement, 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. (d) 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 Agreement shall be deemed to prevent the District from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement 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 Agreement. If the District chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Agreement, the District shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.
The District acknowledges and understands that other state and federal laws, including but not limited to the Securities Act of 1933 and Rule 10b-5 promulgated under the Securities Exchange Act of 1934, as amended may apply to the District, and that under some circumstances compliance with this Disclosure Agreement, without additional disclosures or other action, may not fully discharge all duties and obligations of the District under such laws.
SECTION 10. Default. In the event of a failure of the District or the Dissemination Agent to comply with any provision of this Disclosure Agreement, 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 1214
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Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the District or the Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel performance.
SECTION 11. Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement, 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 other than the District 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 Agreement. 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 Agreement. The Dissemination Agent shall not be liable under any circumstances for monetary damages to any person for any breach under this Disclosure Agreement.
The Dissemination Agent may file reports, notices and other information as required by this agreement electronically to the Repository. If the District is equipped to receive such information electronically, the Dissemination Agent will include the District in any simultaneous electronic dissemination of materials.
SECTION 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the District, 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 13. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
SECTION 14. Governing Law. This Disclosure Agreement shall be construed and governed in accordance with the laws of the State of California.
SECTION 15. Notices. Notices shall be provided, as required hereunder, to the applicable addressees below:
Authority: Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris
101 North D Street
Perris, California 92570
Telephone: (951) 943-6100
Attention: Finance Director
Dissemination Agent: Willdan Financial Services
27368 Via Industria, Suite 200
Temecula, CA 92590
Telephone: (951) 587-3500
Attention: District Administration
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SECTION 16. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof.
SECTION 17. Merger. Any person succeeding to all or substantially all of the Dissemination Agent’s corporate trust business shall be the successor Dissemination Agent without the filing of any paper or any further act.
COMMUNITY FACILITIES DISTRICT NO. 2022-2
(PERRIS LOGISTICS CENTER) OF THE CITY OF
PERRIS
By:
Executive Director
WILLDAN FINANCIAL SERVICES,
as Dissemination Agent
By:
Its: Authorized Agent
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EXHIBIT A
NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT Name of Obligated Person: Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris
Name of Bond Issue: Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris Special Tax Bonds, 2026 Series
Date of Issuance: __________, 2026
NOTICE IS HEREBY GIVEN that Community Facilities District No. 2022-2 (Perris Logistics Center) of the City of Perris (the “District”) has not provided an Annual Report with respect to the above-named Bonds as required by Section 3 of the Continuing Disclosure Agreement, dated October 1, 2026. [The District anticipate that the Annual Report will be filed by ________.] Dated: __________
__________________________________,
as Dissemination Agent
cc: City of Perris
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APPENDIX E
FORM OF MASTER DEVELOPER CONTINUING DISCLOSURE CERTIFICATE 1218
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APPENDIX F
APPRAISAL REPORT
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APPENDIX G
DTC AND THE BOOK-ENTRY-ONLY SYSTEM
The information in this section concerning DTC and DTC’s book-entry only system has been obtained from sources that the District believes to be reliable, but the District takes no responsibility for the completeness or accuracy thereof. The following description of the procedures and record keeping with respect to beneficial ownership interests in the Bonds, payment of principal, premium, if any, accreted value and interest on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfers of beneficial ownership interests in the Bonds and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC.
1. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for the Bonds (the “Securities”). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each maturity of the Securities in the aggregate principal amount of such maturity, and will be deposited with DTC.
2. DTC, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+.
The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.
3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser of each Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records.
Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued.
4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial ownership. DTC has no 1220
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knowledge of the actual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners.
The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.
6. Redemption notices shall be sent to DTC. If less than all of the Securities within a maturity are being redeemed, DTC’s practice is to determine by lot the amount of the interest of the Direct Participant in such maturity to be redeemed.
7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).
8. Principal, redemption price and interest payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the District or the Fiscal Agent, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participant and not of DTC, the Fiscal Agent, or the District, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, redemption price and interest payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the District or the Fiscal Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.
9. If applicable, a Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through its Participant, to the Fiscal Agent, and shall effect delivery of such Securities by causing the Direct Participant to transfer the Participant’s interest in the Securities, on DTC’s records, to tender/remarketing agent. The requirement for physical delivery of Securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the Securities are transferred by Direct Participants on DTC’s records and followed by a book-entry credit of tendered Securities to tender/remarketing agent’s DTC account.
10. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to the District or the Fiscal Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered.
11. The District may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC.
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ATTACHMENT 8
CONTINUING DISCLOSURE AGREEMENT
(ATTACHED AS EXHIBIT TO PRELIMINARY
OFFICIAL STATEMENT)
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Attachment No. 9
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Integra Realty Resources
Los Angeles
Appraisal of Real Property
Perris Logistics Center - North and South Sites
Industrial Properties
350 W. Markham St.
Perris, Riverside County, California 92571
Prepared For:
City of Perris
Date of the Report:
September 9, 2026
Report Format:
Appraisal Report
IRR - Los Angeles
File Number: 219-2026-0099
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Subject Photographs
Perris Logistics Center - North and South Sites
350 W. Markham St.
Perris, California
1225
Aerial Photograph
The subject’s North and South Sites are indicated by the red stars above. 1226
Integra Realty Resources 12100 Wilshire Blvd T 213.984.4425 Los Angeles Suite 800 F 916.435.4774
Los Angeles, CA 90025 www.irr.com
September 9, 2026
Mr. Matthew Schenk
Director of Finance
City of Perris
101 North D Street
Perris, CA 92570
SUBJECT: Market Value Appraisal
Perris Logistics Center - North and South Sites
350 W. Markham St.
Perris, Riverside County, California 92571
IRR - Los Angeles File No. 219-2026-0099
Dear Mr. Schenk:
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 subject properties, as well as the aggregate, or cumulative, value of the appraised properties. The client for the assignment is the City of Perris and the intended use of the report is for bond underwriting purposes.
The subject property represents a portion of the City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center) (“CFD No. 2022-2”). Perris Logistics Center comprises two separate non-contiguous sites, Perris Logistics North and Perris Logistics South, each of which includes three sites entitled for development of industrial warehouse use. Overall, CFD No. 2022-2 includes a total of approximately 339.54 acres of land subject to the Special Tax. The appraised property includes North Site 1 and South Sites 1, 2, and 3. With the exception of North Site 1, which is currently under construction of a build-to-suit logistics center 100% pre-leased to Medline Inc., the remainder of the subject property consists of vacant industrial land. It is noted the appraised property excludes North Site 2, a recently completed 1,018,178 square foot logistics center 100% leased and occupied by Lowe's, and North Site 3, a 799,522 square foot logistics center 100% leased and occupied by Home Depot, as these properties have completed assessed value for both land and improvements by the County of Riverside Assessor. Thus, they are excluded from the appraisal. A more 1227
Mr. Matthew Schenk
City of Perris
September 9, 2026
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) (2004).
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 opinion(s) of value, as of the date of value, August 14, 2026, is as follows:
Value Conclusion
Market Value, Subject to a
Hypothetical Condition Ownership Interest Appraised Date of Value Value Conclusion North Site 1 IDI Perris North Fee Simple August 14, 2026 $221,000,000 South Site 1 Anatolia Perris, LLC Fee Simple August 14, 2026 $107,620,000 South Site 2 Silver Hollow, LLC Fee Simple August 14, 2026 $95,060,000 South Site 3 IDIL Perris Fulfillment Center, LP Fee Simple August 14, 2026 $51,440,000 Aggregate of Appraised Values $475,120,000
Assessed Value
North Site 3 Recline Borrower, LLC $191,294,300
North Site 2 IDIL Perris Logistics Center North, LP $166,365,714 Aggregate of Assessed Values $357,660,014
Extraordinary Assumptions and Hypothetical Conditions
(None)
1. The subject property is encumbered by City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center). This appraisal is based on the hypothetical condition that bond proceeds are available to reimburse for certain public improvements and/or Impact Fees completed/paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
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.
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. 1228
Mr. Matthew Schenk
City of Perris
September 9, 2026
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. In addition, although North Site 1 and South Site 3 are owned by affiliated entities, no further discounting of these properties is necessary as both sites are expected to sell individually to separate buyers.
As a condition of this assignment, the Assessed Value for Parcels 310-170-016 (North Site 3) and 310-170-021 (North Site 2), which have completed vertical improvements and a complete Assessed Value for both Land and Improvements, is presented herein for illustration purposes only. As requested, these Assessor's Parcels are not appraised herein; instead, the assigned County of Riverside Assessor's value will be relied upon for underwriting purposes.
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
Eric Segal, MAI
California Certified General Real Estate
Appraiser #AG026558
Telephone: 213.984.4425
Email: [email protected]
Noah Kauffman, MAI, R/W-AC
California Certified General Real Estate
Appraiser #3004618
Telephone: 916.773.3258
Email: [email protected]
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Table of Contents
Perris Logistics Center - North and South Sites
Executive Summary 2
Identification of the Appraisal Problem 3
Subject Description 3
Sale History 4
Pending Transactions 5
Appraisal Purpose 5
Value Type Definitions 5
Property Rights Definitions 5
Client and Intended User(s) 6
Intended Use 6
Applicable Requirements 6
Report Format 6
Prior Services 6
Appraiser Competency 7
Scope of Work 8
Economic Analysis 10
Riverside County Area Analysis 10
Transportation 16
Recreation & Culture 16
Surrounding Area Analysis 19
Industrial Market Analysis 24
Property Analysis 30
Land Description and Analysis 30
Proposed Improvements Description 44
Real Estate Taxes 50
Highest and Best Use 52
Valuation 54
Valuation Methodology 54
Land Valuation 56
Analysis and Adjustment of Sales 60
Property Adjustments 61
Land Value Conclusion 63
Land Value Conclusion – Remaining Subject
Sites 64
Conclusion of Land Value 65
Sales Comparison Approach – North Site 1 68
Analysis and Adjustment of Sales 73
Property Adjustments 74
Value Indication 76
Income Capitalization Approach – North Site 1
78 Leased Status of Property 78
Market Rent Analysis 78
Analysis and Adjustment of Rents 83
Stabilized Income and Expenses 86
Capitalization Rate Selection 89
Direct Capitalization Analysis 92
Reconciliation and Conclusion of Value 93
Extraction Analysis – North Site 1 94
Market Value by Ownership 97
Exposure Time 98
Marketing Time 98
Certification 99
Assumptions and Limiting Conditions 101
Addenda
A. Appraiser Qualifications
B. Definitions
C. Maps
D. Comparable Data
Land Sales -
Improved Sales
Lease Comparables
1230
Subject Description 2
Perris Logistics Center - North and South Sites
Executive Summary
Property Name
Address
Property Type
Owners of Record
Tax ID
Land Area (Gross) 228.27 acres; 9,943,442 SF
Gross Building Area 982,879 SF
Rentable Area 982,879 SF
Percent Leased (Improvements Upon Completion) 100%
Year Built 2027
Zoning Designation
Highest and Best Use - As if Vacant
Highest and Best Use - As Improved
Exposure Time; Marketing Period 6 - 9 months; 6 - 9 months Effective Date of the Appraisal August 14, 2026
Date of the Report September 9, 2026
Property Interest Appraised
IDI Perris North, Anatolia Perris, LLC, Silver Hollow, LLC, IDIL Perris Fulfillment Center, LP
310-170-014, 310-170-015, 330-120-002, 330-120-017, 330- 120-018, 330-120-020, and 330-120-021
Perris Logistics Center - North and South Sites
350 W. Markham St.
Perris, Riverside County, California 92571
Industrial
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 Perris and 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.
LI, Light Industrial & GI, General Industrial
Industrial use
Fee Simple
Continued industrial use
Extraordinary Assumptions and Hypothetical Conditions
(None)
1. The subject property is encumbered by City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center). This appraisal is based on the hypothetical condition that bond proceeds are available to reimburse for certain public improvements and/or Impact Fees completed/paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
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.
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.
1231
Subject Description 3
Perris Logistics Center - North and South Sites
Identification of the Appraisal Problem
Subject Description
The subject property represents a portion of the City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center) (“CFD No. 2022-2”). Perris Logistics Center comprises two separate noncontiguous sites, Perris Logistics North and Perris Logistics South, each of which includes three sites entitled for development of industrial warehouse use. Overall, CFD No. 2022-2 includes a total of approximately 339.54 acres of land subject to the Special Tax. The appraised property includes North Site 1 and South Sites 1, 2, and 3. With the exception of North Site 1, which is currently under construction of a build-to-suit logistics center 100% pre-leased to Medline Inc., the remainder of the subject property consists of vacant industrial land. It is noted the appraised property excludes North Site 2, a recently completed 1,018,178 square foot logistics center 100% leased and occupied by Lowe's, and North Site 3, a 799,522 square foot logistics center 100% leased and occupied by Home Depot, as these properties have completed assessed value for both land and improvements by the County of Riverside Assessor. Thus, they are excluded from the appraisal. A legal description of the property is provided in the addenda.
Property Identification
Property Name Perris Logistics Center - North and South Sites Address 350 W. Markham St.
Perris, California 92571
Tax ID 310-170-020, 330-120-002 & 017 and 330-120-018 & 020, 330-120-021 Owner of Record IDI Perris North, Anatolia Perris, LLC, Silver Hollow, LLC, IDIL Perris Fulfillment Center, LP Land Use Summary
Tax ID Location / Future Land Use Development Status Ownership Entitled
Building SF Land SF Acres
310-170-020 North Site 1 Development In Progress IDI Perris North 982,879 2,178,436 50.01 330-120-002 & 017 South Site 1 Industrial Land Anatolia Perris, LLC 1,385,090 3,262,644 74.90 330-120-018 & 020 South Site 2 Industrial Land Silver Hollow, LLC 1,396,020 2,842,290 65.25 330-120-021 South Site 3 Industrial Land IDIL Perris Fulfillment Center, LP 535,207 1,660,072 38.11 4,299,196 9,943,442 228.27
310-170-016 North Site 3 Completed Warehouse - Home Depot Recline Borrower, LLC 799,522 2,399,982 55.10 310-170-021 North Site 2 Completed Warehouse - Lowe's IDIL Perris Logistics Center North, LP 1,018,178 2,446,765 56.17 1,817,700 4,846,747 111.27
Source: Public Records
Total - Appraised Properties
Total - Property with Completed Assessed Value on Assessor's Roll 1232
Sale History 4
Perris Logistics Center - North and South Sites
Sale History
The most recent closed sales of the subject property are summarized as follows:
The most recent transfer of North Site 2, which was completed in March 2025 and 100% leased to Lowe’s, was non-arm’s length between related parties with no reported sale price.
Both Sites 1 and 2 within Perris Logistics Center South sold in April 2024; the sites were entitled for warehouse buildings at the time of sale. Both purchases were arm’s-length transactions with no unusual motivations. Considering the condition of the sites at the time of the sale, the prior arm’slength transactions are reasonable indicators of the subject’s market value, as of the date of purchase.
South Site 2, which comprises Assessor's Parcels 330-120-018 and -020, previously sold in April 2024 for a total of $106,982,000, or $37.64 per square foot of land area. The site was subsequently sold in September 2025 (shown above) to the current owner, Silver Hollow, LLC, for a total of $115,000,000, or $40.46 per square foot of land area.
It is noted the site development budget for the North and South Sites is approximately $138,267,174, including off-site improvements. The above sales transferred with the expectation that the subject’s master developer would be responsible for completion of off-site work.
South Site 3 is currently being marketed for sale at an undisclosed sale price. To the best of our knowledge, no other sale or transfer of ownership has taken place within a three-year period prior to the effective appraisal date. With the exception of South Site 3, the subject property is not currently being offered for sale.
North Site 2 South Site 1
Sale Date October 12, 2023 April 10, 2024
Seller IDIL Perris North 3, LP IDIL Perris Fulfillment Center, LP Buyer IDIL Perris Logistics Center North, LP Anatolia Perris, LLC Sale Price - $98,874,000
Price PSF of Land Area - $30.30
Recording Instrument Number 2023-0301219 2024-0104484
Notes Non-arm's length Entitled vacant land
South Site 2 South Site 2
Sale Date April 16, 2024 September 25, 2025
Seller IDIL Perris Fulfillment Center, LP DSV Real Estate Los Angeles, LLC Buyer DSV Real Estate Los Angeles, LLC Silver Hollow, LLC Sale Price $106,982,000 $115,000,000
Price PSF of Land Area $37.64 $40.46
Recording Instrument Number 2024-0110572 2025-0294233
Notes Entitled vacant land Entitled vacant land
1233
Pending Transactions 5
Perris Logistics Center - North and South Sites
Pending Transactions
Based on discussions with the appropriate contacts, the property is not subject to an agreement of sale or an option to buy as of the effective appraisal date.
Appraisal Purpose
The purpose of this Appraisal Report is to estimate the market value (fee simple estate) of the appraised properties comprising CFD No. 2022-2 (Perris Logistics Center), subject to the hypothetical condition that certain proceeds from the Special Tax Bonds are available to reimburse for various public improvements and/or impact fees, as of the effective date of the appraisal, August 14, 2026.
The date of the report is September 9, 2026. The appraisal is valid only as of the stated effective date.
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. Buyer and seller are typically motivated;
2. Both parties are well informed or well advised, and acting in what they consider their own best interests;
3. A reasonable time is allowed for exposure in the open market;
4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. 1 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. 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) 1234
Client and Intended User(s) 6
Perris Logistics Center - North and South Sites
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 Perris. The intended users are the City of Perris and 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 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 provided appraisal services for the existing client regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment. 3 Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) 1235
Appraiser Competency 7
Perris Logistics Center - North and South Sites
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.
1236
Appraiser Competency 8
Perris Logistics Center - North and South Sites
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 Inspection Date Notes
Eric Segal, MAI On-site & exterior August 14, 2026 No interior inspection of completed improvements 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:
1237
Appraiser Competency 9
Perris Logistics Center - North and South Sites
Approaches to Value
Approach Applicability to Subject Use in Assignment
Cost Approach Not Applicable Not Utilized
Sales Comparison Approach Applicable Utilized
Income Capitalization Approach Applicable Utilized
In developing an opinion of value for the subject, only the sales comparison approach is used for the parcels which currently reflect vacant land. This approach is applicable to the subject because there is an active market for similar properties, and sufficient sales data is available for analysis. In the sales comparison approach, the subject’s South Site 2 is utilized as a benchmark site for analysis. The subject’s remaining vacant sites (South Site 1 and 3) are then compared to the conclusion of land value for the benchmark site.
The cost approach is not applicable because there are no improvements that contribute value to the property, and the income approach is not applicable because the subject’s vacant parcels are not likely to generate rental income in its current state.
The subject’s North Site 1 is currently owned by IDI Perris North, which is constructing an approximately 982,879 square foot industrial warehouse. Construction of North Site 1 began the second quarter of 2026 and is currently expected to be completed in first quarter 2027. North Site 1 has been 100% pre-leased to Medline, Inc. (“Medline”) for use as a distribution center with a 12 year lease. Both the sales comparison approach and the income capitalization approaches are utilized to determine the market value of this site as if complete from which an estimate of costs to complete and rent loss will be deducted (extraction technique) to derive as estimate of market value in its current condition. As the purpose of this Appraisal Report is estimating the market value of the fee simple interest in the subject property, market rent is utilized in the income capitalization approach.
The cost approach is not utilized. Though the improvements are under new construction, the developer’s construction budget is proprietary and was not provided for review. Construction costs can vary widely by market, with nuances that are often site specific, making national cost estimating services less reliable. As such, the cost approach is considered less reliable and is excluded from the analysis.
The market values estimated herein are based on a hypothetical condition. USPAP defines a hypothetical condition as “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 the analysis.” It is a hypothetical condition of the Appraisal that proceeds from the Bonds are available to reimburse for certain completed public improvements and/or impact fees paid.
The estimate of market value accounts for the impact of the Lien of the Special Taxes securing the Bonds.
As a condition of this assignment, the Assessed Values for certain Assessor's Parcels with a complete Assessed Value for both Land and Improvements is presented herein for illustration purposes only. As requested, these Assessor's Parcels are not appraised herein; instead, the assigned County of Riverside Assessor's value will be relied upon for underwriting purposes. 1238
Riverside County Area Analysis 10
Perris Logistics Center - North and South Sites
Economic Analysis
Riverside County Area Analysis
Riverside County is located in Southern California’s Inland Empire region and represents one of the fastest-growing counties in the state. It is 7,209 square miles in size and has a population density of 352 persons per square mile. The area is characterized by a diverse economy driven by logistics, warehousing, manufacturing, healthcare, education, and tourism, with strong connections to neighboring Los Angeles, Orange, and San Diego counties. Riverside County benefits from its strategic location along major transportation corridors, including Interstates 10, 15, and 215, as well as proximity to regional rail lines and international airports. Community amenities include numerous parks, recreational areas, higher education institutions, and regional attractions such as the Coachella Valley, wine country, and resort destinations. Continued population growth, relatively affordable housing compared to coastal markets, and an expanding industrial base have contributed to increased demand across residential, commercial, and industrial real estate sectors.
Population
Riverside County has an estimated 2026 population of 2,540,505, which represents an average annual
0.8% increase over the 2020 census of 2,418,185. Riverside County added an average of 20,387 residents per year over the 2020-2026 period, and its annual growth rate contrasts with the State of California, which had little to no change in population over this time.
Looking forward, Riverside County's population is projected to increase at a 0.5% annual rate from 2026-2031, equivalent to the addition of an average of 11,986 residents per year. Riverside County's population growth differs from California, which is projected to have little or no change in population during this time.
Employment
Total employment in Riverside County was estimated at 842,108 jobs as of September 2025. Between year-end 2015 and 2025, employment rose by 161,203 jobs, equivalent to a 23.7% increase over the entire period. There were gains in employment in eight out of the past ten years. Riverside County's rate of employment growth over the last decade surpassed that of California, which experienced an increase in employment of 10.1% or 1,675,631 jobs over this period.
Population Compound Ann. % Chng
2020 Census 2026 Estimate 2031 Projection 2020 - 2026 2026 - 2031 Riverside County 2,418,185 2,540,505 2,600,434 0.8% 0.5% California 39,538,223 39,435,158 39,455,567 0.0% 0.0%
Source: Claritas SPOTLIGHT
Population Trends
1239
Riverside County Area Analysis 11
Perris Logistics Center - North and South Sites
A comparison of unemployment rates is another way of gauging an area’s economic health. Over the past decade, the Riverside County unemployment rate has been generally higher than that of California, with an average unemployment rate of 5.9% in comparison to a 5.7% rate for California.
Recent data shows that the Riverside County unemployment rate is 5.4% in comparison to a 5.5% rate for California, a positive sign that is consistent with the fact that Riverside County has outperformed California in the rate of job growth over the past two years.
Employment Sectors
The composition of the Riverside County job market is depicted in the following chart, along with that of California. Total employment for both areas is broken down by major employment sector, and the sectors are ranked from largest to smallest based on the percentage of Riverside County jobs in each category.
Employment Trends
Total Employment (Year End) Unemployment Rate (Ann. Avg.) Year Riverside County
%
Change California
%
Change
Riverside
County California
2015 680,905 16,606,038 6.7% 6.2%
2016 706,809 3.8% 16,930,563 2.0% 6.2% 5.5%
2017 732,428 3.6% 17,263,084 2.0% 5.4% 4.8%
2018 753,119 2.8% 17,573,378 1.8% 4.5% 4.3%
2019 781,240 3.7% 17,857,719 1.6% 4.3% 4.1%
2020 740,727 -5.2% 16,401,290 -8.2% 10.2% 10.2%
2021 791,327 6.8% 17,641,250 7.6% 7.4% 7.3%
2022 809,945 2.4% 18,066,913 2.4% 4.3% 4.3%
2023 826,900 2.1% 18,146,497 0.4% 4.8% 4.7%
2024 842,613 1.9% 18,246,332 0.6% 5.3% 5.3%
2025* 842,108 -0.1% 18,281,669 0.2% 5.5% 5.5%
Overall Change 2015-2025 161,203 23.7% 1,675,631 10.1%
Avg Unemp. Rate 2015-2025 5.9% 5.7%
Unemployment Rate - February 2026 5.4% 5.5%
Source: U.S. Bureau of Labor Statistics and Moody's Analytics. Employment figures are from the Quarterly Census of Employment and Wages (QCEW). Unemployment rates are from the Current Population Survey (CPS). The figures are not seasonally adjusted. *Total employment data is as of September 2025.
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Riverside County Area Analysis 12
Perris Logistics Center - North and South Sites
Riverside County has greater concentrations than California in the following employment sectors:
1. Trade; Transportation; and Utilities, representing 22.9% of the Riverside County payroll employment compared to 16.4% for California as a whole. This sector includes jobs in retail trade, wholesale trade, trucking, warehousing, and electric, gas, and water utilities.
2. Government, representing 17.1% of the Riverside County payroll employment compared to
14.7% for California as a whole. This sector includes employment in local, state, and federal government agencies.
Riverside County is underrepresented in the following sectors:
1. Professional and Business Services, representing 8.8% of the Riverside County payroll employment compared to 15.0% for California as a whole. This sector includes legal, accounting, and engineering firms, as well as management of holding companies.
Employment Sectors - 2025
22.9%
18.4%
17.1%
12.1%
8.8%
8.2%
5.2%
2.9%
2.4%
1.3%
0.6%
16.4%
18.4%
14.7%
11.0%
15.0%
4.9%
6.7%
3.1%
4.3%
2.6%
2.8%
0% 5% 10% 15% 20% 25%
Trade; Transportation; and Utilities
Education and Health Services
Government
Leisure and Hospitality
Professional and Business Services
Construction
Manufacturing
Other Services
Financial Activities
Natural Resources & Mining
Information
Riverside County California
Source: U.S. Bureau of Labor Statistics and Moody's Analytics 1241
Riverside County Area Analysis 13
Perris Logistics Center - North and South Sites
Major Employers
Major employers in Riverside County are shown in the following table.
Gross Domestic Product
Gross Domestic Product (GDP) is a measure of economic activity based on the total value of goods and services produced in a defined geographic area, and annual changes in Gross Domestic Product (GDP) are a gauge of economic growth.
Economic growth, as measured by annual changes in GDP, has been somewhat lower in Riverside County than California overall during the past decade. Riverside County has grown at a 3.0% average annual rate while the State of California has grown at a 3.1% rate. However, Riverside County has recently performed better than California. GDP for Riverside County rose by 3.3% in 2024 while California's GDP rose by 3.2%.
Riverside County has a per capita GDP of $40,503, which is 52% less than California's GDP of $84,007.
This means that Riverside County industries and employers are adding relatively less value to the economy than their counterparts in California.
Name Number of Employees
1 County of Riverside 25,345
2 Amazon 14,317
3 State of California 8,398
4 Wal-Mart 7,523
5 Riverside Unified School District 6,562
6 Moreno Valley Unified School District 6,306
7 Kaiser Permanente Riverside Medical Center 5,817
8 Stater Brothers Market 5,145
9 University of California, Riverside 5,137
10 Eisenhower Medical Center 4,971
Source:
Major Employers - Riverside County
County of Riverside Annual Comprehensive Financial Report, Fiscal Year Ended June 30, 2025 1242
Riverside County Area Analysis 14
Perris Logistics Center - North and South Sites
Household Income
Riverside County has a lower level of household income than California. Median household income for Riverside County is $99,433, which is 5.6% less than the corresponding figure for California.
The following chart shows the distribution of households across twelve income levels. Riverside County has a greater concentration of households in the middle income levels than California.
Specifically, 45% of Riverside County households are between the $50,000 - $150,000 levels in household income as compared to 41% of California households. A lesser concentration of households is apparent in the higher income levels, as 30% of Riverside County households are at the $150,000 or greater levels in household income versus 34% of California households.
Gross Domestic Product
Year
($,000s)
Riverside County % Change
($,000s)
California % Change
2014 76,101,228 – 2,428,675,700 –
2015 79,908,186 5.0% 2,545,979,500 4.8%
2016 81,899,120 2.5% 2,623,711,700 3.1%
2017 84,070,198 2.7% 2,740,550,300 4.5%
2018 87,407,109 4.0% 2,850,970,300 4.0%
2019 90,816,468 3.9% 2,969,609,000 4.2%
2020 89,350,023 -1.6% 2,930,654,600 -1.3%
2021 94,978,542 6.3% 3,151,112,500 7.5%
2022 97,055,611 2.2% 3,147,211,400 -0.1%
2023 99,182,409 2.2% 3,204,016,400 1.8%
2024 102,469,702 3.3% 3,306,928,600 3.2%
Compound % Chg (2014-2024) 3.0% 3.1%
GDP Per Capita 2024 $40,503 $84,007
Source: U.S. Bureau of Economic Analysis (BEA) and Moody's Analytics; data released February 2026.
The release of state and local GDP data has a longer lag time than national data. The data represents inflation-adjusted "real" GDP stated in 2017 dollars.
Median
Riverside County $99,433
California $105,377
Comparison of Riverside County to California - 5.6%
Source: Claritas SPOTLIGHT
Median Household Income - 2026
1243
Riverside County Area Analysis 15
Perris Logistics Center - North and South Sites
Education Levels
Residents of Riverside County have a lower level of educational attainment than those of California.
An estimated 26% of Riverside County residents are college graduates with four-year degrees, versus 37% of California residents.
Household Income Distribution - 2026
7.0%
4.8%
4.9%
7.7%
12.2%
11.2%
9.8%
8.2%
11.1%
6.8%
8.5%
7.8%
6.3%
4.8%
5.2%
8.4%
13.0%
12.5%
10.9%
9.1%
11.9%
6.9%
7.0%
4.0%
0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%
Less than $15,000
$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 and more
Riverside County California
Source: Claritas SPOTLIGHT
1244
Riverside County Area Analysis 16
Perris Logistics Center - North and South Sites
Transportation
Access to and through Riverside County is provided by several major routes, including the 10, 15 and 215 Freeways, as well as State Routes 60, 62, 74, 79, 86, 91, 111 and 243. The 10 Freeway is the primary east-west connector while the 15 and 215 Freeways are the primary north-south routes. The 91 Freeway provides travel from the Inland Empire to Los Angeles County and Orange County, via the 55 Freeway.
The 10 Freeway is a major east-west route in Southern California, connecting the Pacific coast (Santa Monica) with the Arizona state line before traveling further east through the southern states and terminating in Jacksonville, Florida. The 10 Freeway links the coast of California, from the City of Santa Monica, Los Angeles and San Bernardino Counties, with Riverside County and the desert cities of the Coachella Valley.
As a primary north-south connector, the 15 Freeway 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. The 15 Freeway is a major thoroughfare for traffic between San Diego and the Inland Empire, as well as between Southern California and Las Vegas, Nevada. The 215 Freeway comprises approximately 55 miles of interstate highway in the Inland Empire, generally traveling parallel with the 15 Freeway. The southern terminus of the 215 is at the junction of the 15 Freeway in Murrieta in south Riverside County and travels through Perris before briefly merging with the 60 Freeway in Moreno Valley and continuing north from the 60 Freeway interchange to San Bernardino County and reconnecting with the 15 Freeway at Cajon. This interstate provides an alternative to the 15 Freeway for travel within Riverside and San Bernardino Counties.
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. 1245
Riverside County Area Analysis 17
Perris Logistics Center - North and South Sites
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
Riverside County is expected to experience continued growth supported by its strategic location, expanding industrial base, and relative affordability compared to coastal markets. The county’s diverse economy, population growth, and access to major transportation corridors will sustain demand across residential, commercial, and industrial real estate sectors. While ongoing development activity is expected, geographic, infrastructure, and regulatory constraints will likely limit large-scale expansion, supporting long-term market stability.
1246
Riverside County Area Analysis 18
Perris Logistics Center - North and South Sites
Area Map
1247
Surrounding Area Analysis 19
Perris Logistics Center - North and South Sites
Surrounding Area Analysis
Boundaries
The subject property is located within the city of Perris, which is located in Riverside County, within the Inland Empire region of Southern California. Perris is bordered on the north by the March Air Reserve Base, on the east by the unincorporated community of Nuevo, on the south by Sun City, and on the west by the unincorporated community of Mead Valley. The city is associated with Lake Perris, an artificial lake completed in 1973.
Access and Linkages
Perris is served by Interstate 215 providing access to Murrieta to the south and San Bernardino to the north. State Route 74 provides access to Lake Elsinore and Orange County to the west and the San Jacinto and Coachella Valley to the east.
Public transit is available through Riverside Transit Agency. The system offers eleven routes with access to Perris. Additional Dial-A-Ride services are available for ADA certified and seniors 65 years and older. In 2016, the Metrolink commuter rail system was extended from Riverside to Perris, connecting it with other stations along the rail system within the Greater Los Angeles area.
In terms of air travel, there are several proximate airports available to residents of Perris. The Ontario International Airport is the nearest major airport, located approximately 33 miles northwest in Ontario. John Wayne Airport is located approximately 61 miles west in Irvine, and Palm Springs International Airport is located approximately 53 miles to the east. Additional municipal airports are located in Perris and the surrounding areas of Riverside, Hemet, French Valley, and Banning.
Demographics
A demographic profile of the surrounding area, including population, households, and income data, is presented in the following table.
1248
Surrounding Area Analysis 20
Perris Logistics Center - North and South Sites
As shown above, the current population within a 10-minute drive time of the subject is 116,112, and the average household size is 3.4. 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 10-minute drive time of the subject is projected to grow at a similar rate.
Median household income is $81,492, which is lower than the household income for Riverside County.
Though, this is likely attributable to the subject's location with an industrial region of the Inland Empire.
Land Uses
Land uses in the immediate area are primarily industrial and commercial in nature, with some vacant/agricultural land, and residential uses located west of the subject’s North Site and north of the subject’s South Site.
The nearest large retail center south of the subject is along W. Nuevo Road and the 215 freeway.
Some tenants within the center include Stater Bros Markets, Big 5, Planet Fitness, Walmart Supercenter, Aldi, Regency Perris as well as other small nationally recognized inline tenants. In addition, just northwest of the subject’s North Site is a shopping center anchored by La Mexicana Market which includes various inline retailers.
The March Air Reserve Base is located approximately eight miles northwest of the subject. While previously used and identified as the March Air Force Base, the site has been repurposed as part of the world-wide network of Army and Air Force Exchange Services. It stocks a variety of clothes, household goods and other items available for purchase by Military personnel. Major distribution 1249
Surrounding Area Analysis 21
Perris Logistics Center - North and South Sites
warehouse facilities nearby include: Amazon, Sketchers, Harbor Freight Tools, Ross Dress for Less, and Proctor & Gamble.
Land uses immediately adjacent to the subject’s sites are presented below.
Immediate Surroundings
North Site South Site
North Vacant Land, Light Industrial Industrial
South Vacant Land, Light Industrial Vacant land
East Home Depot Distribution Center, I-215 Vacant land
West Light Industrial, Commercial Vacant land
Recreation & Community Facilities
The city of Perris offers various recreational opportunities and community facilities, with additional services accessible within the larger cities of San Bernardino, Riverside, and Moreno Valley. Perris is known regionally as a location for skydiving and hot-air ballooning. Recreational activities in the city include museums and the Perris Auto Speedway, a half-mile oval racetrack located near Perris Reservoir.
The Perris Reservoir and California State Park, Lake Perris Recreation Area offers camping, hiking, bike trails, horseback riding, and water activities on the lake (boating, fishing, swimming). Additional water activities are available at Lake Elsinore, a natural freshwater lake located southwest of Perris, along State Route 74.
The nearest hospital is the Kindred Hospital Riverside, located in Perris, with additional hospital facilities mostly located to the north in Riverside. The city is served by numerous elementary schools, middle schools, high schools and an adult school. There are community parks and commercial services available within the city with additional supporting commercial services in nearby cities.
Outlook and Conclusions
In conclusion, the subject’s immediate neighborhood includes a mix of industrial properties and vacant land. The overall condition and quality of the neighborhood is rated as average. The subject property is considered to have good transportation characteristics, including proximity to major neighborhood thoroughfares and freeway access. Overall, the subject is expected to perform reasonably well over the long term.
1250
Surrounding Area Analysis 22
Perris Logistics Center - North and South Sites
Surrounding Area Map – North Site
1251
Surrounding Area Analysis 23
Perris Logistics Center - North and South Sites
Surrounding Area Map – South Site
1252
Industrial Market Analysis 24
Perris Logistics Center - North and South Sites
Industrial Market Analysis
Metro Area Overview
The subject is located in the Inland Empire metro area as defined by CoStar, which encompasses Riverside and San Bernardino Counties. The Inland Empire industrial market is experiencing a period of adjustment following several years of unprecedented growth. Leasing activity remains healthy by historical standards, though it has moderated from peak levels as tenants focus on more efficient, modern space and older facilities face higher vacancy. Overall availability has increased, reflecting a combination of new deliveries and shifting tenant demand. Rental rates, which surged during the pandemic, have softened in recent quarters but remain elevated compared to pre-pandemic norms.
Construction activity continues, though at a more cautious pace, with developers responding to changing market dynamics and broader economic uncertainty. Despite near-term challenges, the region benefits from strong logistics infrastructure, a diversified economic base, and limited developable land, all of which support its long-term position as a key industrial hub in Southern California.
Trended supply and demand statistics, including inventory levels, absorption, vacancy, and rental rates for all classes of space are presented in the ensuing table. 1253
Industrial Market Analysis 25
Perris Logistics Center - North and South Sites
Inland Empire Metro Trends and Forecasts
• The current vacancy rate in the metro area is 8.85%; the vacancy rate has increased by 175 bps from 2024 Q2.
• Two-year Base Case forecasts project a 7.69% vacancy rate in the metro area, representing a decrease of 116 bps by 2028 Q2.
• Asking rent averages $12.14/SF in the metro area, and values have decreased by 6.40% from 2024 Q2.
• Two-year Base Case forecasts project a $12.49/SF asking rent in the metro area, representing an increase of 2.88% by 2028 Q2.
Source: CoStar, Inc.; compiled by Integra Realty Resources, Inc.
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
$14.0
$16.0
2016
Q2
2017
Q2
2018
Q2
2019
Q2
2020
Q2
2021
Q2
2022
Q2
2023
Q2
2024
Q2
2025
Q2
2026
Q2
2027
Q2
2028
Q2
2029
Q2
2030
Q2
Vacancy Rate vs. Asking Rent
Asking Rent ($/SF) Vacancy Rate (%)
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Industrial Market Analysis 26
Perris Logistics Center - North and South Sites
• The total stock (SF) has increased by 3.15% from 2024 Q2, while the demand has increased by
1.21%.
• Between 2021 Q3 and 2026 Q2, net completions in the metro area have averaged 19,499,836 SF annually, and reached a peak of 14,031,005 SF in 2023 Q4. • Between 2021 Q3 and 2026 Q2, net absorption in the metro area has averaged 9,335,211 SF annually, and reached a peak of 9,688,396 SF in 2021 Q3.
Source: CoStar, Inc.; compiled by Integra Realty Resources, Inc.
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
-10,000,000
-5,000,000
0 5,000,000
10,000,000
15,000,000
20,000,000
Supply and Demand Trends
Completions (SF) Absorption (SF) Vacancy Rate (%)
1255
Industrial Market Analysis 27
Perris Logistics Center - North and South Sites
Industrial Market Forecast Comparisons
Source: CoStar, Inc.; compiled by Integra Realty Resources, Inc.
8.6%
7.7%
7.0%
6.6%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
2027 Q2 2028 Q2 2029 Q2 2030 Q2
Vacancy Rate Forecasts
Vacancy Rate (%) - Metro
Source: CoStar, Inc.; compiled by Integra Realty Resources, Inc.
0.4%
2.4%
3.9%
4.5%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
2027 Q2 2028 Q2 2029 Q2 2030 Q2
Rent Growth Forecasts
Rent Growth (%) - Metro
1256
Industrial Market Analysis 28
Perris Logistics Center - North and South Sites
Submarkets Overview
Current quarter supply and demand statistics, including inventory levels, absorption, vacancy, and rental rates for the submarkets within the Inland Empire industrial market are presented in the following table. The subject is located within the Moreno Valley / Perris submarket.
Submarket trends within the Inland Empire reflect a growing divide between newer, high-quality facilities and older, less efficient industrial space. The West Inland Empire, with its more established infrastructure and modern inventory, continues to outperform and is posting lower vacancy rates and stronger tenant demand, particularly in core submarkets like the Airport Area and Riverside. In contrast, parts of the East Inland Empire, such as Moreno Valley/Perris, Redlands/Loma Linda, and San Source: CoStar, Inc.; compiled by Integra Realty Resources, Inc.
4.8%
4.8%
4.7% 4.7%
4.7%
4.7%
4.7%
4.7%
4.7%
4.8%
4.8%
4.8%
4.8%
4.8%
4.9%
2027 Q2 2028 Q2 2029 Q2 2030 Q2
Cap Rate Forecasts
Cap Rate (%) - Metro
1257
Industrial Market Analysis 29
Perris Logistics Center - North and South Sites
Bernardino, are experiencing higher vacancy levels and weaker absorption, driven by a combination of significant new deliveries and tenant relocations away from older product. It is noted over 2.7 million square feet of space has come to market in the past twelve months in the subject’s Moreno Valley/Perris submarket, with an additional 2 million under construction.
The Mojave River Valley is the largest submarket with the highest construction activity, having over
3.7 million SF under construction. The Moreno Valley/Perris submarket leads in net absorption with approximately 3.67 million SF positive absorption over the past 12 months. Rental rates here are moderate at $0.85/SF but have declined by 2.16% year-over-year.
Across the region, demand is strongest for mid-sized, well-located distribution space, with large-block requirements slowing as companies reassess space needs amid economic uncertainty. Submarkets closer to ports and major transportation hubs are seeing stronger demand and construction, while outlying areas face higher vacancies, weaker absorption, and lower rents.
Industrial Market Outlook and Conclusions
Looking ahead, the Inland Empire industrial market is expected to face continued near-term challenges, including elevated vacancy in older properties, global supply chain disruptions, tariffrelated trade uncertainties and shifting tenant preferences. However, the limited new supply pipeline and strong underlying economic drivers—particularly in transportation, warehousing, and ecommerce—support a positive outlook. Continued job growth and sustained import volumes through Southern California ports will further bolster demand, positioning the Inland Empire to regain momentum and strengthen its role as a critical logistics hub in the coming years.
Overall, the market is poised for a gradual recovery as the current oversupply is absorbed and construction activity remains subdued. Rental rates are expected to stabilize and begin rising again by 2026, especially in well-located submarkets like the Airport Area. The region’s strategic location, established logistics infrastructure, and constrained land availability are anticipated to support longterm stability.
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Land Description and Analysis 30
Perris Logistics Center - North and South Sites
Property Analysis
Land Description and Analysis
Location and Project Details
The subject property’s North Site is bound by E. 7th Street to the north, S. Redlands Avenue to the west, and E. Ellis Avenue to the south, with the 215 Freeway located to the east. The South Site is bound by Mapes Road to the north, Goetz Road to the east, and Watson Road to the west.
The subject’s two sites are located within two miles of each other. The following table summarizes the subject’s land area.
Land Use Summary
Tax ID Location / Future Land Use Development Status Ownership Entitled
Building SF Land SF Acres
310-170-020 North Site 1 Development In Progress IDI Perris North 982,879 2,178,436 50.01 330-120-002 & 017 South Site 1 Industrial Land Anatolia Perris, LLC 1,385,090 3,262,644 74.90 330-120-018 & 020 South Site 2 Industrial Land Silver Hollow, LLC 1,396,020 2,842,290 65.25 330-120-021 South Site 3 Industrial Land IDIL Perris Fulfillment Center, LP 535,207 1,660,072 38.11 4,299,196 9,943,442 228.27
310-170-016 North Site 3 Completed Warehouse - Home Depot Recline Borrower, LLC 799,522 2,399,982 55.10 310-170-021 North Site 2 Completed Warehouse - Lowe's IDIL Perris Logistics Center North, LP 1,018,178 2,446,765 56.17 1,817,700 4,846,747 111.27
Source: Public Records
Total - Appraised Properties
Total - Property with Completed Assessed Value on Assessor's Roll All of the subject sites are entitled for industrial warehouse/logistics center development.
Shape and Dimensions
The sites are overall generally rectangular in shape. Site utility based on shape and dimensions is generally average; though, the southern portion of South Site 3 is allocated to a detention basin.
Topography
The sites are 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.
Flood Hazard Status
The following table provides flood hazard information.
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Land Description and Analysis 31
Perris Logistics Center - North and South Sites
Flood Hazard Status
North Site South Site
Community Panel Number 06065C1440H 06065C1440H
Date August 18, 2014 August 18, 2014
Zone AE / X AE / X
Description Within 100- year floodplain / Outside
500-year floodplain
Within 100- year floodplain / Outside
500-year floodplain
Insurance Required? No No
A portion of both sites is located within the 100-year floodplain. However, according to developer representatives, a Federal Emergency Management Agency (FEMA) Conditional Letter of Map Revision (CLOMR) has been issued for the subject sites. The CLOMR assumes the installation of perimeter channels and on-site basins, which are currently under construction, and it moves the AE zones to the channel and basin footprints.
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, nor is located in a liquefaction zone.
Fire Hazard Risk
The Fire and Resource Assessment Program of CAL FIRE has classified areas of the subject’s County by Fire Hazard Severity Zone. As shown in the following map, the majority of the subject’s area has not been classified as an area of concern. However, a small portion of the southwest area of the South Site is designated as a Moderate Fire Hazard Severity Zone. The subject properties are indicated by the green star on the following map.
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Land Description and Analysis 32
Perris Logistics Center - North and South Sites
1261
Land Description and Analysis 33
Perris Logistics Center - North and South Sites
Environmental Hazards
Phase I environmental reports were prepared for Perris Logistics Center North and South by Hazard Management Consulting, dated October 7, 2021, and March 12, 2021, respectively. Both reports found no issues of concern and had no recommendations for further action at the sites.
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.
Utilities
The availability of utilities to the subject is summarized in the following table.
Utilities
Service Provider
Water City of Perris
Sewer City of Perris
Electricity Southern California Edison
Natural Gas Southern Califonia Gas
Local Phone Various Providers
Zoning
The subject’s North Site is zoned LI, Light Industrial, and the South Site is zoned GI, General Industrial.
Both zoning designations permit light industrial and manufacturing uses. The following table summarizes our understanding and interpretation of the zoning requirements that affect the subject. 1262
Land Description and Analysis 34
Perris Logistics Center - North and South Sites
Zoning Summary
North Site South Site
Zoning Jurisdiction City of Perris City of Perris
Zoning Designation LI GI
Description Light Industrial General Industrial
Legally Conforming? Appears to be legally conforming Appears to be legally conforming Zoning Change Likely? No No
Permitted Uses Various industrial uses, including
warehouse/distribution and
manufacturing
Various industrial uses, including
warehouse/distribution and
manufacturing
Category Zoning Requirement Zoning Requirement
Minimum Lot Area 15,000 SF 15,000 SF
Minimum Street Frontage (Feet) 75 ft 75 ft
Minimum Lot Width (Feet) 75 ft 75 ft
Minimum Lot Depth (Feet) 100 ft 100 ft
Maximum Building Height 50 ft 50 ft
Maximum Site Coverage 50% 50%
Maximum Floor Area Ratio 0.75 0.75
Parking Requirement 1 space/ 500 SF for manufacturing
uses; 1 space / 1,000 SF for
warehousing uses
1 space/ 500 SF for manufacturing
uses; 1 space / 1,000 SF for
warehousing uses
Source: City of Perris
According to the City of Perris Planning Department, there are no pending or prospective zoning changes. It appears that the current and proposed uses of the sites are legally conforming uses.
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.
Summary of Entitlements
As noted, each of the subject sites is fully entitled for industrial development. The following table summarizes the subject’s entitlements.
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Land Description and Analysis 35
Perris Logistics Center - North and South Sites
Summary of Entitlements
Site Bldg SF Status
North Site 1 982,879
South Site 1 1,385,090
South Site 2 1,396,020
South Site 3 535,207
North Site 1 is currently owned by IDI Perris North, which is constructing an approximately 982,879 square foot industrial warehouse. Construction of North Site 1 began the second quarter of 2026 and is currently expected to be completed in first quarter 2027. North Site 1 has been 100% preleased to Medline, Inc. (“Medline”) for use as a distribution center with a 12 year lease.
South Site 1 is currently vacant land and is entitled for construction of approximately 1,385,090 square feet of industrial warehouse use. The owner is currently developing construction plans for South Site 1 and currently expects to begin construction in 2027.
South Site 3 is vacant land entitled for approximately 535,207 square feet of industrial warehouse use. Construction drawings are underway, while the Master Developer is marketing South Site 3 for sale without a published asking price.
South Site 2 was acquired by its owner in September 2025. South Site 2 is currently vacant land entitled for construction of an approximately 1,396,020 square foot industrial warehouse. The owner is currently developing construction plans for South Site 2, and currently expects to begin construction in 2027.
Easements, Encroachments and Restrictions
We have reviewed a preliminary title report for the subject’s North Site 1 and South Site 3, prepared by First American Title Company dated March 4, 2025. 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.
We were not provided a current title report to review for South Sites 1 and 2. We are not aware of any easements, encroachments, or restrictions that would adversely affect value. Our valuation assumes no adverse impacts from easements, encroachments, or restrictions, and further assumes that the subject has clear and marketable title.
Site Development Costs
Offsite cost obligations are summarized in the following table according to the budget provided by the master developer of Perris Logistics Center. Overall site development costs for both the North and South sites are approximately $138,267,174. In addition, both sites are eligible for DIF and TUMF credits. As of the effective appraisal date, the Developer reports $65,503,527 in site development costs have been incurred on the North Site. There are no remaining cost obligations for the North Site.
South Site remaining cost obligations are reported at $80,963,284, before considering costs incurred to date. For the purposes of this analysis, we have allocated South Site costs across the three sites based upon a pro rata share of acreage for each site.
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Land Description and Analysis 36
Perris Logistics Center - North and South Sites
Summary of Site Development Costs
Description Cost
North Site
Case Road Improvement Costs $21,984,082
Case Road Bridge $12,777,777
Ellis / Redlands $19,218,060
Bonnie / I-215 Cost (approx.) $5,354,153
SCRRA (Metrolink) X-ing Improvement Fees $6,122,000
SCRRA (flagging overage - IDI out-of-pocket) $700,000
ROW Costs $8,955,064
DIF Credits ($6,792,500)
TUMF Credits ($14,014,746)
Sub-Total $54,303,890
Contingency $3,000,000
Total Site Development Costs - North Site $57,303,890
Less: Costs Spent to Date ($65,503,527)
Remaining Site Development Costs - North Site ($8,199,637) South Site
Ellis (Goetz to Case) $2,153,778
Mapes / A-St. / Goetz / Watson $20,619,113
Regional SS Mainline w/ Lift Station $12,957,000
Onsite Storm Drain Channel & Spillway $13,568,805
Goetz Road Bridge Fee $22,000,000
Perris South Trail Fee $6,104,454
ROW Costs $2,724,400
DIF Credits ($5,810,636)
TUMF Credits ($2,353,630)
Sub-Total $71,963,284
Contingency $9,000,000
Total Site Development Costs - South Site $80,963,284
Less: Costs Spent to Date ($26,490,915)
Remaining Site Development Costs - South Site $54,472,369 South Site Allocation Acreage Pro Rata Share Extension
South Site 1 74.90 42.0% $22,887,807
South Site 2 65.25 36.6% $19,938,977
South Site 3 38.11 21.4% $11,645,585
Total 178.26 100.0% $54,472,369
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 various industrial uses, including warehouse/distribution and manufacturing. We are not aware of any other particular restrictions on development.
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Land Description and Analysis 37
Perris Logistics Center - North and South Sites
Plat Map – North Site
1266
Land Description and Analysis 38
Perris Logistics Center - North and South Sites
Plat Map – South Site
1267
Land Description and Analysis 39
Perris Logistics Center - North and South Sites
Site Plan – North Site
1268
Land Description and Analysis 40
Perris Logistics Center - North and South Sites
Site Plan – South Site
Please note, the square footages reported above vary slightly from current entitlements. 1269
Land Description and Analysis 41
Perris Logistics Center - North and South Sites
Assessor Aerial – North Site
Building 1 – Under Construction
1270
Land Description and Analysis 42
Perris Logistics Center - North and South Sites
Assessor Aerial – South Site
1271
Land Description and Analysis 43
Perris Logistics Center - North and South Sites
Assessor Aerial – Both Sites
1272
Proposed Improvements Description 44
Perris Logistics Center - North and South Sites
Proposed Improvements Description
Overview
The subject’s North Site 1 is currently owned by IDI Perris North, which is constructing an approximately 982,879 square foot industrial warehouse. Construction of North Site 1 began the second quarter of 2026 and is currently expected to be completed in first quarter 2027. North Site 1 has been 100% pre-leased to Medline, Inc. (“Medline”) for use as a distribution center with a 12 year lease.
The subject includes 42-foot clear ceiling heights, 3.9% office build out, and 153 dock-high doors.
Additional details regarding the subject’s improvements are summarized in the following tables.
Improvements Description
General Property Type Industrial
Property Sub Type Industrial
Competitive Property Class C
Occupancy Type Single Tenant
Percent Leased 100%
Number of Tenants 1
Number of Buildings 1
Stories 1
Construction Class C
Construction Type Concrete Tilt-Up
Construction Quality Average
Condition New
Gross Building Area (SF) 982,879
Rentable Area (SF) 982,879
Percent Office Space 3.9%
Land Area (SF) 9,943,442
Floor Area Ratio (RA/Land SF) 0.10
Floor Area Ratio (GBA/Land SF) 0.10
Building Area Source Ownership Representatives
Year Built 2027
Actual Age (Yrs.) 0
Estimated Effective Age (Yrs.) 0
Estimated Economic Life (Yrs.) 55
Remaining Economic Life (Yrs.) 55
Number of Parking Spaces 349
Source of Parking Count Site Plan
Parking Type Surface
Parking Spaces/1,000 SF GBA 0.36
1273
Proposed Improvements Description 45
Perris Logistics Center - North and South Sites
Construction Details
Foundation Concrete Slab
Structural Frame Concrete Tilt-Up / Metal
Exterior Walls Concrete Precast / Tilt-Up
Roof Built-Up Composition
Clear Height in Feet 42 ft
Dock Height Loading Doors 153
Grade Level Doors 4
HVAC Roof Central Mounted
Electrical Assumed Adequate
Plumbing Assumed Adequate
Sprinklers Yes
Occupancy Status
The property is 100% pre-leased to Medline Inc.
Improvements Analysis
Quality and Condition
The improvements will be of average to good quality construction and in new condition. The quality of the subject is consistent with competing properties.
Functional Utility
The improvements appear to be adequately suited to their current use.
Deferred Maintenance
The property reflects new construction.
Conclusion of Improvements Analysis
In comparison to competitive properties in the market, the subject improvements, as proposed and partially improved, are as follows:
Improvements Ratings
Visibility/Exposure Average
Design and Appearance Average
Age/Condition Above Average
% Office Average
Loading Docks Average
Clear ceiling heights Average to Above Average
% Sprinklered Average
Landscaping Average
1274
Proposed Improvements Description 46
Perris Logistics Center - North and South Sites
Overall, the quality, condition, and functional utility of the improvements are anticipated to be average to above average for their age and location, based on the similarly constructed buildings on adjacent sites.
1275
Proposed Improvements Description 47
Perris Logistics Center - North and South Sites
Subject north and south sites Subject north site
Subject north site Subject north site
North site 1 North site 1
1276
Proposed Improvements Description 48
Perris Logistics Center - North and South Sites
North site 2 North site 2
Facing East along E Ellis Ave Southwest corner of E Ellis Ave and S Redlands Ave Facing north along E Ellis Ave Facing north along E Ellis Ave 1277
Proposed Improvements Description 49
Perris Logistics Center - North and South Sites
North site 3 North site 3
North site 3 Facing east along E Ellis Ave
Subject south site Subject south site
1278
Real Estate Taxes 50
Perris Logistics Center - North and South Sites
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 reappraised 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 1.138350% for tax year 2026/2027 (latest available), based on assessed value.
In addition, the appraised properties are subject to direct charges. A summary of the appraised properties’ ad valorem taxes and direct assessments is provided below and on the following page.
Taxes and Assessments - 2026/2027
Assessed Value Taxes and Assessments
Tax ID Total Tax Rate
Ad Valorem
Taxes Direct Assessments Total
310-170-020 $11,628,689 1.138350% $132,375 $242,690 $375,065 330-120-002 $68,458,320 1.138350% $779,295 $213,852 $993,147 330-120-017 $34,409,701 1.138350% $391,703 $107,386 $499,089 330-120-018 $95,000,000 1.138350% $1,081,433 $230,539 $1,311,971 330-120-020 $20,000,000 1.138350% $227,670 $49,326 $276,996 330-120-021 $40,567,310 1.138350% $461,798 $163,469 $625,267 $270,064,020 $3,074,274 $1,007,261 $4,081,535
1279
Real Estate Taxes 51
Perris Logistics Center - North and South Sites
Direct Assessment Detail 2026/2027
Tax ID
Perris Storm
Drain District
1 MWD
Standby East
EMWD
Infrastructure
Availability
Charge
Perris
Landscape
District
CFD No. 2022-2
(Perris Logistics
Ct) Total
310-170-020 $2,851 $335 $531 $17,958 $221,014 $242,690
330-120-002 $346 $548 $212,957 $213,852
330-120-017 $174 $275 $106,936 $107,386
330-120-018 $373 $591 $229,575 $230,539
330-120-020 $80 $127 $49,119 $49,326
330-120-021 $264 $419 $162,785 $163,469
$2,851 $1,572 $2,492 $17,958 $982,387 $1,007,261
Special Assessments
All of the appraised properties are encumbered by the Special Tax Lien of City of Perris CFD No. 2022-2 (Perris Logistics Center), which increases 2% per year. With respect to special taxes, we have relied upon information provided by the special tax consultant. for the annual special tax levy on the appraised properties, which are updated in the following table for tax year 2026/2027.
Special Taxes 2026/2027
Tax ID
CFD No. 2022-2
(Perris Logistics Ct)
310-170-020 $225,435
330-120-002 $217,217
330-120-017 $109,075
330-120-018 $234,166
330-120-020 $50,102
330-120-021 $166,041
In addition, the North Sites have been annexed into CFD No. 1-S (South Perris Public Services) and CFD No. 2018-02 (Public Services District); the South Sites will eventually also be annexed into both CFDs.
Special taxes for 2026/2027 are shown in the following table, based on information from the special tax consultant.
Additional Taxes - North Site
Tax Unit Acres / SF Total Tax
$1,860.40 per acre 50.01 $93,039
$25.39 per 1,000 SF of building area 982,879 $24,955
1280
Highest and Best Use 52
Perris Logistics Center - North and South Sites
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 sites are zoned LI, Light Industrial, and GI, General Industrial. Permitted uses include various industrial uses, including warehouse/distribution and manufacturing. To our knowledge, there are no legal restrictions such as easements or deed restrictions that would effectively limit the use of the property. Each of the subject Sites have approved entitlements for construction of industrial/warehouse 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 industrial use is given further consideration in determining 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 industrial 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 to the perimeter of the sites. The properties are not located within an adverse earthquake or flood zone (as a CLOMR has been issued), which would impact development. A small portion of the southwestern portion of the South Site is located within a moderate Fire Hazard Severity Zone, while the remaining portion of the subject are not located in an adverse fire zone. 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, industrial use is considered physically possible and most appropriate
1281
Highest and Best Use 53
Perris Logistics Center - North and South Sites
Financially Feasible
While industrial development is legally permissible and physically possible, new construction is not financially feasible under current market conditions. Overall, market conditions weakened in 2023 in response to macroeconomic factors, including increasing interest rates and inflation. Rental rates and sale prices may be high enough to justify new construction; though, new speculation space may lead to higher market vacancy. Thus, new construction may not be considered financially feasible unless in a build-to-suit situation. It is our opinion the highest and best use of the subject property as though vacant would be future industrial development, in accordance with the subject’s approved entitlements. The timing of future development would depend on market conditions as it relates to the expected absorption timeline for the lease-up of new and existing industrial space, as well as market rent and sale price levels.
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 to hold for industrial development until market conditions support new construction (existing vacant space is absorbed by the market).
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 most probable buyer of the subject sites as vacant would be an investor/industrial developer. 1282
Valuation Methodology 54
Perris Logistics Center - North and South Sites
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 Applicability to Subject Use in Assignment
Cost Approach Not Applicable Not Utilized
Sales Comparison Approach Applicable Utilized
Income Capitalization Approach Applicable Utilized
In developing an opinion of value for the subject, only the sales comparison approach is used for the parcels which currently reflect vacant land. This approach is applicable to the subject because there is an active market for similar properties, and sufficient sales data is available for analysis. In the sales 1283
Valuation Methodology 55
Perris Logistics Center - North and South Sites
comparison approach, the subject’s South Site 2 is utilized as a benchmark site for analysis. The subject’s remaining vacant sites (South Site 1 and 3 and North Site 1) are then compared to the conclusion of land value for the benchmark site.
The cost approach is not applicable because there are no improvements that contribute value to the property, and the income approach is not applicable because the subject’s vacant parcels are not likely to generate rental income in its current state.
The subject’s North Site 1 features a logistics facility currently under construction. The sales comparison approach is utilized to determine the market value of this site.
The market values estimated herein are based on a hypothetical condition. USPAP defines a hypothetical condition as “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 the analysis.” It is a hypothetical condition of the Appraisal that proceeds from the Bonds are available to reimburse for certain completed public improvements. The estimate of market value accounts for the impact of the Lien of the Special Taxes securing the Bonds. 1284
Land Valuation 56
Perris Logistics Center - North and South Sites
Land Valuation
To develop an opinion of the subject’s land value, as though vacant and available to be developed to its highest and best use, the sales comparison approach is used. This approach develops an indication of value by researching, verifying, and analyzing sales of similar properties. The research focused on transactions within the following parameters:
• Location: Riverside and San Bernardino Counties
• Size: Minimum of 20 acres
• Use: Proposed industrial use
• Transaction Date: 2023 or later
For this analysis, price per square foot is used as the appropriate unit of comparison because market participants typically compare sale prices and property values on this basis. The most relevant sales are summarized in the following table. Sale 1 represents the 2025 sale of the subject property’s South Site 2. Sales 2 and 3 reflect 2024 sales of the subject property’s South Sites 1 and 2. 1285
Land Valuation 57
Perris Logistics Center - North and South Sites
Summary of Comparable Land Sales
No. Name/Address
Sale Date;
Status
Effective Sale
Price
SF;
Acres Zoning
$/SF
Land $/Acre
1 Perris Logistics Center - South Site 2 Sep-25 $115,000,000 2,842,290 GI $40.46 $1,762,452 Mapes St. Closed 65.25
Perris
Riverside County
CA
2 Perris Logistics Center - South Site 2 Apr-24 $106,982,000 2,842,290 GI $37.64 $1,639,571 Mapes St. Closed 65.25
Perris
Riverside County
CA
3 Perris Logistics Center - South Site 1 Apr-24 $98,874,000 3,262,644 GI $30.30 $1,320,080 Mapes St. Closed 74.90
Perris
Riverside County
CA
4 Barton St Oct-23 $65,242,000 2,119,194 BMP $30.79 $1,341,048 Riverside Closed 48.65
Riverside County
CA
5 SWC Lowell St & N. Locust Ave Aug-23 $72,000,000 1,738,480 I-GM $41.42 $1,804,059 Lowell St Closed 39.91
Rialto
San Bernardino County
CA
6 Scott Road Commerce Center Feb-23 $60,841,341 1,474,941 I-P $41.25 $1,796,850 33380 Zeiders Rd. Closed 33.86
Menifee
Riverside County
CA
Subject 2,842,290 LI
Perris Logistics Center - South Site 2 65.25
Perris, CA
Comments: Property sold w ith entitlements in place for a 1,396,020 SF distribution facility.
Comments: Property sold w ith entitlements in place for a 1,396,020 SF distribution facility. As of April 2025, the buyer's plans are on-hold among current market conditions, and the buyer is evaluating w hether to sell or retain the site.
Comments: Sale of vacant industrial land entitled by the seller for development of a 1,385,090 SF distribution facility. The buyer's plans are on-hold among current market conditions; estimated timing for construction of future improvements is one to three years.
Comments: Sale of 48.65 acres of land just w est of I-215 Freew ay; approximately 35 acres of the site is usable, w ith the remaining acreage designated for conservation. The buyer is constructing tw o industrial buildings totaling 603,100 SF, w hich w ill be offered for sale or lease.
Comments: The 39.91-acre industrial land at Low ell St., Fontana, CA, sold for $72 million on August 31, 2023, at $41.42 per square foot. Zoned I-GM, the property is vacant and intended for distribution and industrial development, w ith 584 feet of frontage on Low ell St. Ow ned by Brookfield Corporation, the site is located in the San Bernardino Submarket, approximately 15 miles from Ontario International Airport.
Comments: Sale of three contiguous parcels w ith frontage along I-215. The property w ill be developed into the "Gatew ay at Menifee" logistics campus, w hich w ill include three industrial buildings totaling 544,115 SF. 1286
Land Valuation 58
Perris Logistics Center - North and South Sites
Comparable Land Sales Map
1287
Land Valuation 59
Perris Logistics Center - North and South Sites
Sale 1
Perris Logistics Center - South Site 2
Sale 2
Perris Logistics Center - South Site 2
Sale 3
Perris Logistics Center – South Site 1
Sale 4
Barton St
Sale 5
Scott Road Commerce Center
Sale 6
Scott Road Commerce Center
1288
Land Valuation 60
Perris Logistics Center - North and South Sites
Analysis and Adjustment of Sales
Adjustments are based on a rating of each comparable sale in relation to the subject. The adjustment process is typically applied through either quantitative or qualitative analysis, or a combination of both analyses. Quantitative adjustments are often developed as dollar or percentage amounts, and are most credible when there is sufficient data to perform a paired sales analysis. In this analysis, qualitative adjustments are utilized.
The rating of each comparable sale in relation to the subject is the basis for the adjustments. If the comparable is superior to the subject, its sale price is adjusted downward to reflect the subject’s relative attributes; if the comparable is inferior, its price is adjusted upward.
Transactional adjustments are applied for property rights conveyed, financing, conditions of sale, expenditures made immediately after purchase, and market conditions. In addition, property adjustments include – but are not limited to – location, access/exposure, size, quality, effective age, economic and legal characteristics, and non-realty components of value. Adjustments are considered for the following factors, in the sequence shown below.
Transactional Adjustments
Real Property Rights Conveyed
The opinion of value in this report is based on a fee simple estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat, as well as non-detrimental easements, community facility districts, and conditions, covenants and restrictions (CC&Rs). All the comparables represent fee simple estate transactions. Therefore, adjustments for property rights are not necessary.
Financing Terms
In analyzing the comparables, it is necessary to adjust for financing terms that differ from market terms. Typically, if the buyer retained third-party financing (other than the seller) for the purpose of purchasing the property, a cash price is presumed and no adjustment is required. However, in instances where the seller provides financing as a debt instrument, a premium may have been paid by the buyer for below-market financing terms, or a discount may have been demanded by the buyer if the financing terms were above market. The premium or discounted price must then be adjusted to a cash equivalent basis. The comparable sales represented cash-to-seller or cash-equivalent transactions and, therefore, do not require adjustment.
Conditions of Sale
Adverse conditions of sale can account for a significant discrepancy from the sale price actually paid, compared to that of the market. This discrepancy in price is generally attributed to the motivations of the buyer and the seller. Certain conditions of sale are considered non-market and may include the following:
• a seller acting under duress (e.g., eminent domain, foreclosure); • buyer motivation (e.g., premium paid for assemblage, certain 1031 exchanges); 1289
Land Valuation 61
Perris Logistics Center - North and South Sites
• a lack of exposure to the open market;
• an unusual tax consideration;
• a sale at legal auction.
None of the comparable sales had atypical or unusual conditions of sale. Thus, adjustments are not necessary.
Expenditures Made Immediately After Purchase
This category considers expenditures incurred immediately after the purchase of a property. There were no issues of deferred maintenance reported for any of the properties. No adjustments are required for expenditures after sale.
Market Conditions
A market conditions adjustment is applied when market conditions at the time of sale differ from market conditions as of the effective date of value. Adjustments can be positive when prices are rising, or negative when markets are challenged by factors such as a deterioration of the economy or adverse changes in supply and/or demand in the market area. Consideration must also be given to when the property was placed under contract, versus when the sale actually closed.
In evaluating market conditions, changes between the comparable sale date and the effective date of this appraisal may warrant adjustment; however, if market conditions have not changed, then no adjustment is required.
The sales took place from February 2023 to September 2025. Overall, industrial market conditions softened throughout 2023 into 2024, characterized by increasing vacancy rates, declining or stagnating asking rental rates, and macroeconomic challenges (such as 2023 interest rate increases).
Further, global supply chain disruptions and tariff-related trade uncertainties are having an interim impact on the market. Comparables transacting in 2023 are adjusted downward.
Property Adjustments
Location
Factors considered in evaluating location include, but are not limited to, demographics, growth rates, surrounding uses and property values.
Sales 1, 2, and 3 are located at the subject’s South Site, and Sale 6 is located in Menifee, which is similar in appeal to Perris. No adjustments are made to these comparables. The remaining comparables are located farther north in the cities of Riverside and Rialto. These submarkets tend to command higher rental rates than the subject’s submarket and are ranked as superior.
Access/Exposure
Convenience to transportation facilities, ease of site access, and overall visibility of a property can have a direct impact on property value. High visibility, however, may not translate into higher value if it is not accompanied by good access. In general, high visibility and convenient access, including 1290
Land Valuation 62
Perris Logistics Center - North and South Sites
proximity to major linkages, are considered positive amenities when compared to properties with inferior attributes.
All of the sales are similar to the subject and require no adjustment.
Size
When considering the industrial land market, particularly for logistics and distribution center sites, larger sites are typically more desirable than smaller sites due to increased utility for warehouse construction. After a certain point, when sites become so large that they appeal to only a very limited number of users, the market begins to exhibit an inverse relationship between land area and price per square foot; when this occurs, larger sites generally sell for a lower price per square foot than smaller sites, all else being equal, due to economies of scale.
The comparables range from 33.86 to 74.90 acres and bracket the subject; no adjustments are necessary.
Shape and Topography
This category accounts for the shape of the site influencing its overall utility and/or development potential, as well as the grade of the land.
Although Sale 4 includes 48.65 gross acres, only approximately 35 acres of the site are usable for development; the remaining acreage is allocated to conservation use. This Sale is adjusted upward. In addition, Sale 5 is ranked as inferior due to the flag shape of the site.
Zoning/Entitlements
This category considers allowable uses on the site, as well as whether entitlements for development were in-place at the time of sale. Sites that transfer with approved entitlements command premiums over unentitled sites.
The majority of comparables were entitled at the time of sale and require no adjustment. Sale 5 was unentitled and is ranked as inferior.
Adjustments Summary
The sales are compared to the subject and adjusted to account for material differences that affect value. The following table summarizes the adjustments applied to each sale. 1291
Land Valuation 63
Perris Logistics Center - North and South Sites
Land Sales Adjustment Grid
Subject Comparable 1 Comparable 2 Comparable 3 Comparable 4 Comparable 5 Comparable 6 Name Perris Logistics
Center - South Site
2 Perris Logistics
Center - South Site
2 Perris Logistics
Center - South Site
2 Perris Logistics
Center - South Site
1 Barton St SWC Lowell St & N.
Locust Ave
Scott Road
Commerce Center
Address Mapes St. Mapes St. Mapes St. Mapes St. Barton St. Lowell St 33380 Zeiders Rd.
City Perris Perris Perris Perris Riverside Rialto Menifee County Riverside Riverside Riverside Riverside Riverside San Bernardino Riverside State California CA CA CA CA CA CA
Sale Date Sep-25 Apr-24 Apr-24 Oct-23 Aug-23 Feb-23
Sale Status Closed Closed Closed Closed Closed Closed
Sale Price $115,000,000 $106,982,000 $98,874,000 $65,242,000 $72,000,000 $60,841,341 Price Adjustment – – – – – –
Description of Adjustment
Effective Sale Price $115,000,000 $106,982,000 $98,874,000 $65,242,000 $72,000,000 $60,841,341 Square Feet 2,842,290 2,842,290 2,842,290 3,262,644 2,119,194 1,738,480 1,474,941 Acres 65.25 65.25 65.25 74.90 48.65 39.91 33.86
Price per Square Foot $40.46 $37.64 $30.30 $30.79 $41.42 $41.25 Transactional Adjustments
Property Rights Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Ranking – – – – – –
Financing Terms Cash to seller Cash to seller Cash to seller Cash to seller - buyer obtained
financing
Cash to seller Cash to seller -
buyer obtained
financing
Ranking – – – – – –
Conditions of Sale Arm's-length Arm's-length Arm's-length Arm's-length Arm's-length Arm's-length Ranking – – – – – –
Expenditures Made Immediately After Purchase
Ranking – – – – – –
Market Conditions 8/14/2026 Sep-25 Apr-24 Apr-24 Oct-23 Aug-23 Feb-23 Ranking – – – Superior Superior Superior
Property Adjustments
Location Perris – – – Superior Superior –
Access/Exposure Average – – – – – –
Size 65.25 acres – – – – – –
Shape and Topography Average – – – Very Inferior Inferior – Zoning/Entitlements Entitled – – – – Inferior –
Overall Ranking Similar Similar Similar Similar Superior Superior Indicated Value $40.00
Land Value Conclusion
Prior to adjustments, the sales reflect a range of $30.30 - $41.42 per square foot. Overall, the comparables are deemed reliable and applicable to produce a credible estimate of market value for the subject properties. To arrive at an indication of value, primary weight is given to Sales 1, 2, and 3 (located within the subject’s South Site), with the remaining comparables providing good secondary support.
Based on the preceding analysis, a ranking of the subject’s South Site 2 and the comparable sales is provided as follows:
1292
Land Valuation 64
Perris Logistics Center - North and South Sites
Ranking Analysis and Reconciliation - South Site 2
Comparable No. Overall Comparability
Price per Square
Foot Estimated Value
5 Superior $41.42
6 Superior $41.25
1 Similar $40.46
Subject $40.00
2 Similar $37.64
4 Similar $30.79
3 Similar $30.30
Estimated Unit Value $40.00
The conclusion of land value is applied to the square footage of the subject’s South Site 2 below.
Land Value Conclusion - South Site 2
Indicated Value per Square Foot $40.00
Subject Square Feet 2,842,290
Indicated Value $113,691,600
Rounded $113,690,000
South Site 2 recently sold for $115,000,000, or $40.46 per square foot, which is considered indicative of market. Thus, the conclusion of value for South Site 2 will be consistent with the recent sale price in this analysis.
Land Value Conclusion – Remaining Subject Sites
As noted, the subject’s South Site 2 is considered as a benchmark site for which to compare the subject property’s remaining Sites.
South Site 1 includes 74.90 acres and is located at the corner of Mapes Road and South A Street. While the site enjoys a corner location, site development plans indicate access to the property is expected to solely be provided by Mapes Road (to the north) and Watson Street (to the south), similar to South Site 2. Overall, South Site 1 is expected to be viewed similarly as Site 2 by the local market. Therefore, a land value conclusion of $40.00 per square foot is selected.
South Site 3 is located at the southwest corner of Mapes Street and Goetz Road, with access from both roads according to site plans, and includes 38.11 acres. The site is somewhat irregularly shaped, with the southern portion of the site allocated to a detention basin and no access from Watson Street to the south. Accordingly, a 5% downward adjustment is applied to the market value conclusion of Site 2 to arrive at a market value conclusion of $38.00 per square foot for South Site 3.
The following table summarizes the land value conclusions for the subject sites. 1293
Conclusion of Land Value 65
Perris Logistics Center - North and South Sites
Land Value Conclusion Per Square Foot
Site Acreage Land SF Conclusion / SF Ranking
South Site 2 (benchmark) 65.25 2,842,290 $40.46
South Site 1 74.90 3,262,644 $40.00 Similar
South Site 3 38.11 1,660,072 $38.00 Inferior
Conclusion of Land Value
In addition, there are remaining off-site improvement obligations that must be considered for the subject Sites. Offsite cost obligations are summarized in the following table according to the budget provided by the master developer of Perris Logistics Center. Overall site development costs for both the North and South sites are approximately $138,267,174. In addition, both sites are eligible for DIF and TUMF credits. As of the effective appraisal date, the Developer reports $65,503,527 in site development costs have been incurred on the North Site. There are no remaining cost obligations for the North Site. South Site remaining cost obligations are reported at $80,963,284, before considering costs incurred to date. For the purposes of this analysis, we have allocated South Site costs across the three Buildings/Sites based upon a pro rata share of acreage for each site. 1294
Conclusion of Land Value 66
Perris Logistics Center - North and South Sites
Summary of Site Development Costs
Description Cost
North Site
Case Road Improvement Costs $21,984,082
Case Road Bridge $12,777,777
Ellis / Redlands $19,218,060
Bonnie / I-215 Cost (approx.) $5,354,153
SCRRA (Metrolink) X-ing Improvement Fees $6,122,000
SCRRA (flagging overage - IDI out-of-pocket) $700,000
ROW Costs $8,955,064
DIF Credits ($6,792,500)
TUMF Credits ($14,014,746)
Sub-Total $54,303,890
Contingency $3,000,000
Total Site Development Costs - North Site $57,303,890
Less: Costs Spent to Date ($65,503,527)
Remaining Site Development Costs - North Site ($8,199,637) South Site
Ellis (Goetz to Case) $2,153,778
Mapes / A-St. / Goetz / Watson $20,619,113
Regional SS Mainline w/ Lift Station $12,957,000
Onsite Storm Drain Channel & Spillway $13,568,805
Goetz Road Bridge Fee $22,000,000
Perris South Trail Fee $6,104,454
ROW Costs $2,724,400
DIF Credits ($5,810,636)
TUMF Credits ($2,353,630)
Sub-Total $71,963,284
Contingency $9,000,000
Total Site Development Costs - South Site $80,963,284
Less: Costs Spent to Date ($26,490,915)
Remaining Site Development Costs - South Site $54,472,369 South Site Allocation Acreage Pro Rata Share Extension
South Site 1 74.90 42.0% $22,887,807
South Site 2 65.25 36.6% $19,938,977
South Site 3 38.11 21.4% $11,645,585
Total 178.26 100.0% $54,472,369
Remaining site development/offsite costs are considered in the following table, in conjunction with the concluded market value per square foot of land area. 1295
Conclusion of Land Value 67
Perris Logistics Center - North and South Sites
Final Conclusion of Land Value
Site Acreage Land SF Price / SF Extension
Site
Development Total Rounded
South Site 1 74.90 3,262,644 $40.00 $130,505,760 ($22,887,807) $107,617,953 $107,620,000 South Site 2 65.25 2,842,290 $40.46 $115,000,000 ($19,938,977) $95,061,023 $95,060,000 South Site 3 38.11 1,660,072 $38.00 $63,082,721 ($11,645,585) $51,437,136 $51,440,000 1296
Sales Comparison Approach – North Site 1 68
Perris Logistics Center - North and South Sites
Sales Comparison Approach – North Site 1
The sales comparison approach develops an indication of value by comparing the subject to sales of similar properties. The steps taken to apply the sales comparison approach are:
• Identify relevant property sales;
• Research, assemble, and verify pertinent data for the most relevant sales; • Analyze the sales for material differences in comparison to the subject; • Reconcile the analysis of the sales into a value indication for the subject.
To apply the sales comparison approach, the research focused on transactions within the following parameters:
• Property Type: Distribution warehouse
• Location: Riverside and San Bernardino Counties
• Size: 500,000 SF or larger
• Age/Quality: No restriction
• Transaction Date: 2023 or later
For this analysis, price per square foot of rentable area is used as the appropriate unit of comparison because market participants typically compare sale prices and property values on this basis. The sales considered most relevant are summarized in the following table. Sale 5 reflects the Perris Logistics Center North Site 3, which was a build-to-suit for Home Depot. 1297
Sales Comparison Approach – North Site 1 69
Perris Logistics Center - North and South Sites
Summary of Comparable Improved Sales
No. Name/Address
Sale
Date;
Status
Yr. Blt.;
# Stories;
% Occ.
Acres;
FAR;
Parking Ratio
Clear Height;
% Office;
Prop Rights
Effective Sale
Price
Rentable
SF
$/Rentable
SF Cap Rate
1 1001 Columbia Ave. Jan-26 2011 25.33 42 $223,000,000 507,000 $439.84 – 1001 Columbia Ave. Closed 1 0.46 4%
Riverside – 0.31/1,000 Fee Simple
Riverside County
CA
2 21600 Cactus Ave Mar-25 2019 52.44 40 $257,050,000 889,445 $289.00 – 21600 Cactus Ave. Closed 1 0.39 1%
Riverside 100% 0.66/1,000 Fee Simple
Riverside County
CA
3 Sierra Business Center Sep-24 2024 32.30 40 $240,637,500 690,967 $348.26 5.00% 16604 Slover Ave Closed 1 0.49 1%
Fontana 100% – Leased Fee
San Bernardino County
CA
4 4450 E. Lowell St & 3351 E. Philadelphia St May-24 1996/1998 24.67 30 $142,250,000 519,116 $274.02 5.42% 4450 E. Lowell St & 3351 E. Philadelphia St Closed 1 0.48 2% Ontario 100% 0.62/1,000 Leased Fee
San Bernardino County
CA
5 13423-13473 Santa Ana Ave. Apr-24 2000 35.82 30 $197,000,000 819,004 $240.54 – 13423 Santa Ana Ave. Closed 1 0.52 1%
Fontana 70% 0.43/1,000 Leased Fee
San Bernardino County
CA
6 Home Depot Distribution Center Dec-23 2023 55.10 40 $183,866,500 799,522 $229.97 – 400 Ellis Ave. Closed 1 0.33 1%
Perris 100% – Leased Fee
Riverside County
CA
7 Sierra Business Park - Bldg 5 Jan-23 2006 45.90 – $365,000,000 1,101,840 $331.26 – 10545 Production Ave Closed 1 0.55 10%
Fontana – 0.58/1,000 Fee Simple
San Bernardino County
CA
Subject 2027 228.27 42 ft 982,879
Perris Logistics Center - North and South Sites 1 0.10 4% Perris, CA 100% 0.36/1,000 Fee Simple
Comments: Sale of 2011 build industrial/cold storage facility, totaling 507,000 square feet. The property sold to Walmart, the sole occupant of the building at the time of sale. The building features 42' clear heights and a 4.4% office build-out ratio.
Comments: New ly-constructed single tenant industrial building. The property is located approximately 0.5 miles from freew ay access and has 1.4 doors per 10,000 SF.
Comments: Sale of distribution center to tenant, Burlington Distribution. The improvements have 220 dock-high doors and 40 ft clear ceiling heights.
Comments: Property w as 100% leased to Home Depot on a 20-year term at the time of sale. The property includes a rail spur that runs through the property. Reportedly, the rental rate w as based on a yield on cost.
Comments: Sale of tw o non-contiguous properties that sold as a single transaction. The buildings are similar in quality, age and condition. They are located 0.4 to 0.5 miles from freew ay access and have a combined total of 1.7 doors per 10,000 SF. Brokers believed rents to be approximately 15% below market w ith w eighted average lease term of 2.9 years.
Comments: Property is located approximately 1.4 miles from freew ay access and has 1.6 doors per 10,000 SF. It w as reportedly 70% occupied at sale.
Comments: This reflects a sale-leaseback transaction to a single tenant. 1298
Sales Comparison Approach – North Site 1 70
Perris Logistics Center - North and South Sites
Comparable Improved Sales Map
1299
Sales Comparison Approach – North Site 1 71
Perris Logistics Center - North and South Sites
Sale 1
1001 Columbia Ave.
Sale 2
21600 Cactus Ave
Sale 3
Sierra Business Center
Sale 4
4450 E. Lowell St & 3351 E. Philadelphia St
Sale 5
13423-13473 Santa Ana Ave.
Sale 6
Home Depot Distribution Center
1300
Sales Comparison Approach – North Site 1 72
Perris Logistics Center - North and South Sites
Sale 7
Sierra Business Park - Bldg 5
1301
Sales Comparison Approach – North Site 1 73
Perris Logistics Center - North and South Sites
Analysis and Adjustment of Sales
Adjustments are based on a rating of each comparable sale in relation to the subject. The adjustment process is typically applied through either quantitative or qualitative analysis, or a combination of both analyses. Quantitative adjustments are often developed as dollar or percentage amounts, and are most credible when there is sufficient data to perform a paired sales analysis. In this analysis, qualitative adjustments are utilized.
The rating of each comparable sale in relation to the subject is the basis for the adjustments. If the comparable is superior to the subject, its sale price is adjusted downward to reflect the subject’s relative attributes; if the comparable is inferior, its price is adjusted upward.
Transactional adjustments are applied for property rights conveyed, financing, conditions of sale, expenditures made immediately after purchase, and market conditions. In addition, property adjustments include – but are not limited to – location, access/exposure, size, quality, effective age, economic and legal characteristics, and non-realty components of value. Adjustments are considered for the following factors, in the sequence shown below.
Transactional Adjustments
Real Property Rights Conveyed
The comparables consist of a combination of fee simple and leased fee sales. It appears the leased fee comparables sold with terms equivalent to market and were not influenced by above- or belowmarket contract terms. No adjustments are required for property rights conveyed.
Financing
In analyzing the comparables, it is necessary to adjust for financing terms that differ from market terms. Typically, if the buyer retained third-party financing (other than the seller) for the purpose of purchasing the property, a cash price is presumed and no adjustment is required. However, in instances where the seller provides financing as a debt instrument, a premium may have been paid by the buyer for below-market financing terms, or a discount may have been demanded by the buyer if the financing terms were above market. The premium or discounted price must then be adjusted to a cash equivalent basis. The comparable sales represented cash-to-seller or cash equivalent transactions and, therefore, do not require adjustment.
Conditions of Sale
Adverse conditions of sale can account for a significant discrepancy from the sale price actually paid, compared to that of the market. This discrepancy in price is generally attributed to the motivations of the buyer and the seller. Certain conditions of sale are considered non-market and may include the following:
• a seller acting under duress (e.g., eminent domain, foreclosure); • buyer motivation (e.g., premium paid for assemblage, certain 1031 exchanges); • a lack of exposure to the open market;
1302
Sales Comparison Approach – North Site 1 74
Perris Logistics Center - North and South Sites
• an unusual tax consideration;
• a sale at legal auction.
None of the comparable sales had atypical or unusual conditions of sale. Thus, adjustments are not necessary.
Expenditures Made Immediately After Purchase
This category considers expenditures incurred immediately after the purchase of a property. There were no issues of deferred maintenance reported for any of the properties. No adjustments are required for expenditures after sale. In addition, the two fee simple comparables (Sales 1 and 6) reflect either a purchase by the tenant (Sale 1) or a sale-leaseback transaction (Sale 6); therefore, no adjustments for lease up costs are necessary.
Market Conditions
A market conditions adjustment is applied when market conditions at the time of sale differ from market conditions as of the effective date of value. Adjustments can be positive when prices are rising, or negative when markets are challenged by factors such as a deterioration of the economy or adverse changes in supply and/or demand in the market area. Consideration must also be given to when the property was placed under contract, versus when the sale actually closed.
In evaluating market conditions, changes between the comparable sale date and the effective date of this appraisal may warrant adjustment; however, if market conditions have not changed, then no adjustment is required.
The sales took place from January 2023 through March 2025. Overall, industrial market conditions softened throughout 2023 into 2024, characterized by increasing vacancy rates, declining or stagnating asking rental rates, and macroeconomic challenges (such as 2023 interest rate increases).
Comparables transacting in 2023 are adjusted downward.
Property Adjustments
Location
Factors considered in evaluating location include, but are not limited to, demographics, growth rates, surrounding uses and property values.
Sale 6 reflects the adjacent North Site 3. The remaining sales are located farther north, proximate to I10 and within submarkets that command higher industrial rental rates than the subject’s submarket, and are superior to the subject.
Access/Exposure
Convenience to transportation facilities, ease of site access, and overall visibility of a property can have a direct impact on property value. High visibility, however, may not translate into higher value if it is not accompanied by good access. In general, high visibility and convenient access, including proximity to major linkages, are considered positive amenities when compared to properties with inferior attributes. All of the comparables are similar to the subject. 1303
Sales Comparison Approach – North Site 1 75
Perris Logistics Center - North and South Sites
Building Size
Due to economies of scale, the market exhibits an inverse relationship between building area and price per square foot, such that larger properties sell for a lower rate per square foot than smaller properties, all else being equal. In some cases, larger buildings are constructed as build-to-suit projects with rents reflecting a return on cost.
The sales range from 507,000 to 1,101,840 square feet and bracket the subject. No adjustments have been made.
Effective Age/Condition
While year built can give insight into the utility of a property, the more important consideration is the level of condition and modernization of the property. The subject was constructed in 2025 and is in new condition. Comparables exhibiting older effective ages are adjusted upward to reflect the discrepancy in remaining economic life.
Sales 3 and 6 were constructed in 2024 and 2023 and are similar to the subject. Sales 1, 4, 5 and 7 are significantly older than the subject and are ranked inferior. Sale 2 was constructed in 2019 and is considered slightly inferior.
Quality of Construction
This category accounts for construction quality, amenities, market appeal and functional utility.
Sale 1 is a cold storage facility and is considered to be superior in terms of construction quality; thus, a downward consideration is warranted.
Property Characteristics
This category considers characteristics such as number of dock high and grade level doors, clear ceiling heights, percent office build out, and rail access. The following table compares the property characteristics of the subject property to the comparables.
Property Features - Sale Comparables
Feature Subject
1001 Columbia
Ave. 21600 Cactus Ave. 16604 Slover Ave
4450 E. Lowell St &
3351 E.
Philadelphia St
13423 Santa Ana
Ave. 400 Ellis Ave.
10545 Production
Ave
Dock High Doors 153 98 220 92 79 130 27 96
Grade Level Overhead Doors 4 10 0 4 3 4 7 4
Total Doors 157 108 220 96 82 134 34 100
Total SF 982,879 507,000 889,445 690,967 519,116 819,004 799,522 562,089 SF of Building Area per Door 6,260 4,694 4,043 7,198 6,331 6,112 23,515 5,621 Adjustment Sl. Superior Sl. Superior Similar Similar Similar Very Inferior Similar Rail Access No No No No No No Yes No
Adjustment Similar Similar Similar Similar Similar Very Superior Similar Clear Height (ft) 42 42 40 40 30 30 40 30
Adjustment Similar Similar Similar Inferior Inferior Similar Inferior Office Space 3.9% 4.4% 1.3% 1.0% 2.0% 1.0% 1.3% 2.0%
Adjustment Similar Sl. Inferior Sl. Inferior Similar Sl. Inferior Sl. Inferior Similar Total Adjustment Superior Similar Similar Inferior Inferior Similar Inferior Sales 2, 3, and 6 are similar to the subject. Sales 4, 5 and 7 are inferior to the subject. Sale 1 is superior to the subject.
1304
Sales Comparison Approach – North Site 1 76
Perris Logistics Center - North and South Sites
Economic Characteristics
Items considered in this category consist of non-stabilized occupancy, above/below market rents, tenant mix, and other economic factors. Excluded are differences in rent levels that are already considered in previous adjustments, such as for location or quality. Note: these adjustments are made as refinements. Care is made to avoid double-counting adjustments previously applied.
The majority comparables are similar to the subject. Sale 4 was leased below market at the time of sale and is ranked as inferior. In addition, Sale 6 reflects a build-to-suit for Home Depot, with the rental rate reportedly based upon a yield-on-cost, which falls below current market rent. This sale is ranked as inferior.
Adjustments Summary
The following table summarizes the adjustments discussed above and applied to each sale.
Improved Sales Adjustment Grid
Subject Comparable 1 Comparable 2 Comparable 3 Comparable 4 Comparable 5 Comparable 6 Comparable 7 Property Name Perris Logistics
Center - North and
South Sites
1001 Columbia
Ave.
21600 Cactus Ave Sierra Business
Center
4450 E. Lowell St &
3351 E.
Philadelphia St
13423-13473
Santa Ana Ave.
Home Depot
Distribution Center
Sierra Business
Park - Bldg 5
Address 350 W. Markham
St.
1001 Columbia
Ave.
21600 Cactus Ave. 16604 Slover Ave 4450 E. Lowell St &
3351 E.
Philadelphia St
13423 Santa Ana
Ave.
400 Ellis Ave. 10545 Production
Ave
City Perris Riverside Riverside Fontana Ontario Fontana Perris Fontana County Riverside Riverside Riverside San Bernardino San Bernardino San Bernardino Riverside San Bernardino State Cal iforni a CA CA CA CA CA CA CA
Sale Date Jan-26 Mar-25 Sep-24 May-24 Apr-24 Dec-23 Jan-23 Sale Status Closed Closed Closed Closed Closed Closed Closed Sale Price $223,000,000 $257,050,000 $240,637,500 $142,250,000 $197,000,000 $183,866,500 $365,000,000 Conditions of Sale Adjustment – – – – – – –
Other Adjustment – – – – – – –
Description of Adjustment
Effective Sale Price $223,000,000 $257,050,000 $240,637,500 $142,250,000 $197,000,000 $183,866,500 $365,000,000 Gross Building Area 982,879 507,000 889,445 690,967 519,116 819,004 799,522 1,101,840 Rentable Area 982,879 507,000 889,445 690,967 519,116 819,004 799,522 1,101,840 Year Built 2027 2011 2019 2024 1996/1998 2000 2023 2006 Price per SF of Rentable Area $439.84 $289.00 $348.26 $274.02 $240.54 $229.97 $331.26 Transactional Adjustments
Property Rights Fee Simple Fee Simple Leased Fee Leased Fee Leased Fee Leased Fee Fee Simple Ranking – – – – – – –
Financing Terms Cash to seller Cash to seller Cash to seller Cash to seller - buyer obtained
financing
Cash to seller Cash to seller Sale Leaseback
Ranking – – – – – – –
Conditions of Sale Arm's-length Arm's-length Arm's-length Arm's-length Arm's-length Arm's-length Arm's-length Ranking – – – – – – –
Expenditures Made Immediately After Purchase
Ranking – – – – – – –
Market Conditions 8/14/2026 Jan-26 Mar-25 Sep-24 May-24 Apr-24 Dec-23 Jan-23 Ranki ng – – – – – Superi or Superi or
Cumulative Adjusted Price $439.84 $289.00 $348.26 $274.02 $240.54 $229.97 $331.26 Property Adjustments
Location Superior Superior Superior Superior Superior – Superior Access /Expos ure – – – – – – –
Building Size – – – – – – –
Effective Age/Condition Inferior Inferior – Inferior Inferior – Inferior Qual i ty of Constructi on Superi or – – – – – –
Property Characteristics Superior – – Inferior Inferior – Inferior Economi c Characteri s ti cs – – – Inferi or – Inferi or – Overall Ranking Superior Similar Superior Similar Inferior Inferior Superior Indicated Value $280.00
Value Indication
Prior to adjustment, the sales reflect a range of $229.97 - $439.84 per square foot. The following table reflects the ranking of the subject property among the comparables. 1305
Sales Comparison Approach – North Site 1 77
Perris Logistics Center - North and South Sites
Ranking Analysis and Reconciliation
Comparable No. Overall Comparability
Price per SF of
Rentable Area Estimated Value
1 Superior $439.84
3 Superior $348.26
7 Superior $331.26
2 Similar $289.00
Subject $280.00
4 Similar $274.02
5 Inferior $240.54
6 Inferior $229.97
Estimated Unit Value $280.00
Based on the preceding analysis, the value indication for the North Site 1, by the sales comparison approach, is as follows:
Value Indication by Sales Comparison - North Site 1
Indicated Value per SF $280.00
Subject Square Feet 982,879
Indicated Value $275,206,120
Rounded $275,200,000
1306
Income Capitalization Approach – North Site 1 78
Perris Logistics Center - North and South Sites
Income Capitalization Approach – North Site 1
The income capitalization approach converts anticipated economic benefits of owning real property into a value estimate through capitalization. The steps taken to apply the income capitalization approach are:
• Analyze the revenue potential of the property.
• Consider appropriate allowances for vacancy, collection loss, and operating expenses. • Calculate net operating income by deducting vacancy, collection loss, and operating expenses from potential income.
• Apply the most appropriate capitalization method, either direct capitalization or discounted cash flow analysis, or both, to convert anticipated net income to an indication of value.
The two most common capitalization methods are direct capitalization and discounted cash flow analysis. In direct capitalization, a single year’s expected income is divided by an appropriate capitalization rate to arrive at a value indication. In discounted cash flow analysis, anticipated future net income streams and a future resale value are discounted to a present value at an appropriate yield rate.
In this analysis, we use only direct capitalization because investors in this property type typically rely more on this method.
Leased Status of Property
The property is 100% pre-leased to Medline Inc., on a 12 year lease, with four five-year extension options. Consistent with estimating the market value of the fee simple interest in the subject property, market rent is utilized in the upcoming analysis.
Market Rent Analysis
To estimate market rent for the subject, the research focused on comparable rentals within the following parameters:
• Location: Riverside and San Bernardino Counties
• Property Type: Industrial
• Size: Minimum of 500,000 square feet
• Date: 2023 or later
Comparable rentals considered most relevant are summarized in the following table. 1307
Income Capitalization Approach – North Site 1 79
Perris Logistics Center - North and South Sites
Summary of Comparable Rentals - Industrial
No. Property Information Tenant SF
Clear Height;
% Office
Lease
Start
Term
(Mos.) Rent/SF Escalations Lease Type
1 Sierra Business Park - Bldg Tireco, Inc. 1,101,840 32 Feb-25 24 $1.46 Fixed Triple Net 10545 Production Ave 10%
Fontana
San Bernardino County
CA
2 Perris Distribution Center Whirlpool 1,686,590 30 Jan-25 85 $1.08 Fixed Triple Net 3722 N. Redlands Ave. 1%
Perris
Riverside County
CA
3 3412 Manitou Ct White Horse Logistics 560,025 40 Jul-25 127 $1.29 Fixed Triple Net 3412 Manitou Ct. 1%
Jurupa Valley
Riverside County
CA
4 Building A LC Logistics Services 557,500 30 Apr-25 91 $1.13 Fixed Triple Net 12300 Riverside Dr 2%
Eastvale
Riverside County
CA
5 Ontario Mills Distribution Owens & Minor 520,161 32 Jan-25 60 $1.40 Fixed Triple Net 5125 Ontario Mills Pky 1%
Ontario
San Bernardino County
CA
6 Bldg 2 Gigacloud Technology 562,089 30 Jul-24 68 $1.10 Fixed Triple Net 3510 E. Francis Ave 2%
Ontario
San Bernardino County
CA
7 13277 San Bernardino Ave. Western Post 577,905 30 Jul-24 126 $1.10 Fixed Triple Net 13277 San Bernardino Ave. 1%
Fontana
San Bernardino County
CA
Comments: Building is located 0.9 miles from access to I-10, and also has good access to I-15. The building is LEED-certified. There are 2.1 doors per 10,000 SF.
Tenant was given $4.00 per square foot for tenant improvements, with no free rent on a 60 month term. Escalations are 3.75% annually.
Comments: Suite has 96 dock-high doors and four grade-level doors.
Comments: Building has 85 dock-high doors and four grade-level doors.
Comments: Building has 109 dock-high doors and four grade-level doors.
Comments: Two-year lease renewal of a warehouse/distribution facility; tenant received two months of free rent and no TI allowance. The space has clear ceiling heights of 32 feet, 220 dock-high doors, and 4 grade-level doors.
Comments: Lease renewal to Whirlpool. The tenant received one month of free rent and a $1.50 psf TI allowance. The space includes 277 dock-high doors, 4 grade-level doors, and 1.2% office space. Clear ceiling heights are 30 feet.
Comments: Building has 79 dock-high doors and four grade-level doors. 1308
Income Capitalization Approach – North Site 1 80
Perris Logistics Center - North and South Sites
Comparable Rentals Map
1309
Income Capitalization Approach – North Site 1 81
Perris Logistics Center - North and South Sites
Lease 1
Sierra Business Park - Bldg 5
Lease 2
Perris Distribution Center
Lease 3
3412 Manitou Ct
Lease 4
Building A
Lease 5
Ontario Mills Distribution Center
Lease 6
Bldg 2
1310
Income Capitalization Approach – North Site 1 82
Perris Logistics Center - North and South Sites
Lease 7
13277 San Bernardino Ave.
1311
Income Capitalization Approach – North Site 1 83
Perris Logistics Center - North and South Sites
Analysis and Adjustment of Rents
The rents are compared to the subject and adjusted to account for material differences that affect value, in the sequence shown below.
Expense Structure
The subject and comparables are leased on a triple net basis. No adjustments are necessary.
Market Conditions
The comparable rents were signed from July 2024 to July 2025. Market conditions have generally been stable over this time, and no adjustments are made.
Location
Factors considered in evaluating location include, but are not limited to, rental rates, growth rates, surrounding uses, and property values.
Rent 2 is located in Perris and requires no adjustment. The remaining comparables are located in Fontana, Jurupa Valley, Eastvale, and Ontario. These comparables are ranked as superior as they are located in submarkets that command higher industrial rental rates than the subject’s submarket.
Access/Exposure
Convenience to transportation facilities, ease of site access, and overall visibility of a property can have a direct impact on property value. High visibility, however, may not translate into higher value if it is not accompanied by good access. In general, high visibility and convenient access, including proximity to major linkages, are considered positive amenities when compared to properties with inferior attributes.
All of the comparables are similar to the subject. No adjustments are necessary.
Space Size
Due to economies of scale, the market exhibits an inverse relationship between building area and price per square foot, such that larger properties rent for a lower rate per square foot than smaller properties, all else being equal. To account for this relationship, applicable adjustments are applied for differences in building area.
The comparables range from 520,161 to 1,686,590 and bracket the subject. No adjustments have been made.
Effective Age/Condition
While year built can give insight into the utility of a property, the more important consideration is the level of condition and modernization of the property. The subject is new (under) construction.
Comparables are adjusted upward to reflect the discrepancy in remaining economic life.
Rent 3 is similar to the subject and requires no adjustment. The remaining comparables have older effective ages and are adjusted upward.
1312
Income Capitalization Approach – North Site 1 84
Perris Logistics Center - North and South Sites
Quality of Construction
This category accounts for differences in quality of construction materials and finishes between the subject and the comparables.
All of the comparables are generally similar to the subject. No adjustments are necessary.
Property Characteristics
This element considers characteristics such as clear ceiling heights, percent office space, and number of dock-high and grade level doors. The following table compares the subject to the rent comparables.
Property Features - Lease Comparables
Feature Subject
10545 Production
Ave
3722 N. Redlands
Ave. 3412 Manitou Ct. 12300 Riverside Dr
5125 Ontario
Mills Pky
3510 E. Francis
Ave
13277 San
Bernardino Ave.
Dock High Doors 153 220 277 79 109 106 96 85
Grade Level Overhead Doors 4 4 4 4 4 4 4 4
Total Doors 157 224 281 83 113 110 100 89
Total SF 982,879 1,101,840 1,686,590 560,025 557,500 520,161 562,089 577,905 SF of Building Area per Door 6,260 4,919 6,002 6,747 4,934 4,729 5,621 6,493 Adjustment Sl. Superior Similar Similar Sl. Superior Sl. Superior Similar Similar Clear Height (ft) 42 32 30 40 30 32 30 30
Adjustment Inferior Inferior Similar Inferior Inferior Inferior Inferior Office Space 3.9% 10.0% 1.2% 1.0% 2.0% 0.8% 2.0% 1.0%
Adjustment Superior Sl. Inferior Sl. Inferior Similar Sl. Inferior Similar Sl. Inferior Total Adjustment Superior Inferior Similar Similar Similar Inferior Inferior Economic Characteristics
Items considered in this category include variations in rental rate attributable to such factors as free rent or other concessions, pattern of rent changes over the lease term, or tenant improvement allowances.
All of the comparables are similar to the subject. No adjustments are necessary.
Adjustments Summary
The following table summarizes the adjustments discussed above and applied to each comparable rent.
1313
Income Capitalization Approach – North Site 1 85
Perris Logistics Center - North and South Sites
Rental Adjustment Grid - Industrial
Subject Comparable 1 Comparable 2 Comparable 3 Comparable 4 Comparable 5 Comparable 6 Comparable 7 Property Name Perris Logistics
Center- North Site
1 Sierra Business
Park - Bldg 5
Perris Distribution
Center
3412 Manitou Ct Building A Ontario Mills
Distribution Center
Bldg 2 13277 San
Bernardino Ave.
Address S. Redlands Ave. 10545 Production
Ave
3722 N. Redlands
Ave.
3412 Manitou Ct. 12300 Riverside Dr 5125 Ontario
Mills Pky
3510 E. Francis
Ave
13277 San
Bernardino Ave.
City Perris Fontana Perris Jurupa Valley Eastvale Ontario Ontario Fontana County Riverside San Bernardino Riverside Riverside Riverside San Bernardino San Bernardino San Bernardino State CA CA CA CA CA CA CA
Lease Start Date Feb-25 Jan-25 Jul-25 Apr-25 Jan-25 Jul-24 Jul-24 Lease Term (Months) 24 85 127 91 60 68 126
Tenant Name Tireco, Inc. Whirlpool White Horse
Logistics
LC Logistics
Services
Owens & Minor Gigacloud
Technology
Western Post
Leased SF 1,101,840 1,686,590 560,025 557,500 520,161 562,089 577,905 Lease Type Triple Net Triple Net Triple Net Triple Net Triple Net Triple Net Triple Net Year Built 2027 2006 2006 2024 1998 2013 2008 2002
Base Rent/SF/Mo. $1.46 $1.08 $1.29 $1.13 $1.40 $1.10 $1.10 Transactional Adjustments
Expense Structure
Ranking – – – – – – –
Conditions of Lease
Ranking – – – – – – –
Market Conditions 8/14/2026 Feb-25 Jan-25 Jul-25 Apr-25 Jan-25 Jul-24 Jul-24 Ranking – – – – – – –
Cumulative Adjusted Rent $1.46 $1.08 $1.29 $1.13 $1.40 $1.10 $1.10 Property Adjustments
Location Superior – Superior Superior Superior Superior Superior Access /Expos ure – – – – – – –
Space Size – – – – – – –
Effective Age/Condition Inferior Inferior – Inferior Inferior Inferior Inferior Quality of Construction – – – – – – –
Property Characteristics Superior Inferior – – – Inferior Inferior Economi c Characteri s ti cs – – – – – – –
Overall Ranking Superior Inferior Superior Similar Superior Inferior Inferior Indicated Rent $1.20
Market rent is the rental income that a property would most probably command in the marketplace. A number of comparable industrial properties within the subject’s market area and surrounding areas were surveyed in order to determine market rent. The comparable properties presented on the preceding pages are considered the most similar to the subject that we could accurately confirm.
Consistent with the existing lease, the subject is analyzed on triple net terms.
Other factors considered when adjusting the comparables consisted of lease conditions, market conditions, and differences in physical characteristics. In equating the comparables to the subject, all are considered reasonable indicators of market rent.
Market Rent Conclusion
The rent comparables include annual escalations that range from 3.50% to 4.00%. Based on the preceding analysis of comparable rentals and trends evident in the market, we conclude market lease terms for the subject as follows:
Concluded Market Lease Terms
Space Type SF
Market
Rent Measure
Rent
Escalations Lease Type
Lease
Term
(Mos.)
Industrial 982,879 $1.20 $/SF/Mo. 4% Triple Net 120
1314
Income Capitalization Approach – North Site 1 86
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Stabilized Income and Expenses
Potential Gross Rent
Potential gross rent is based on the conclusion of market rent. Income is projected for the 12-month period following the effective date of the appraisal.
Potential Gross Rent
Space Type SF $/SF/Mo. Annual
Industrial 982,879 $1.20 $14,153,458
Potential Rent at Market
Expense Reimbursements
Consistent with a triple net leasing strategy, tenant reimbursements comprise a portion of potential gross income. The tenants are responsible for all expenses, including management fees. Utilities and janitorial expenses are paid directly to the providers by the tenants and are not shown in our analysis.
The remaining tenant expenses are paid in the form of reimbursements to the property owner.
Expense items are discussed in the Operating Expenses discussion in this report.
Vacancy & Collection Loss
Please refer to the Industrial Market Overview section for a detailed discussion of market and/or submarket vacancy factors. Vacancy rates have been increasing over the past several quarters.
However, the subject property is 100% leased to a single credit-rated tenant, on a 125-month term.
Based on the current market for industrial properties in the subject’s area, and the subject’s tenancy, a stabilized vacancy and collection loss factor is estimated at 3.0%. This will be deducted from potential gross income to account for potential vacancy and credit/collection loss.
Effective Gross Income
Effective gross income is calculated at $19,671,537, or $20.01 per square foot, per year.
Expenses
To estimate pro forma operating expenses for the subject property, we considered expense data from comparable properties throughout the region. As noted, utilities for the subject are assumed to be paid directly by the tenant and are not included in our expense projections; however, some of the comparables report utility expenses.
1315
Income Capitalization Approach – North Site 1 87
Perris Logistics Center - North and South Sites
Expense Analysis per Square Foot
Comp 1 Comp 2 Comp 3 Comp 4
Year Built 2016 2008 2023 2007
SF 310,550 529,970 814,822 798,304
Prevailing Lease Type – – – –
Operating Data Type Trailing-12 In Place Trailing-12 In Place Year 2023 2023 2023 2023
Real Estate Taxes $1.05 $1.10 $5.67 $16.37 $3.43
CFD No. 2022-2, CFD No. 1-S, CFD No. 2018-02 $0.00 $0.00 $0.00 $0.00 $0.35 Insurance $0.25 $0.24 $0.81 $1.48 $0.75
Repairs/Maintenance $0.00 $0.06 $0.10 $1.84 $1.50
Management $0.42 $0.34 $1.00 $4.21 $0.20
Total $1.72 $1.74 $7.58 $23.90 $6.23
Operating Expense Ratio 11.5% 24.3% NA 27.1% 31.1%
*Comp 1:
Comp 2:
Comp 3:
Comp 4:
Comp Data*
Projected Expenses
2027
982,879
–
2701 Keystone Pacific Pky, Patterson, CA
Cherry Valley Logistics Center, 36312 Cherry Valley Blvd , Cherry Valley, CA 3994 S Riverside Ave, Colton, CA
Subject
IRR Projection
SoFo Logistics, 15790 Santa Ana Ave. , Fontana, CA
Note that a replacement reserve expense has not been estimated for the subject property since the overall capitalization rates extracted from the sales data did not include this as an expense.
Additionally, property taxes are calculated by applying the subject’s tax rate to the market value estimate via the income capitalization approach. The premise is that taxes would be reassessed upon the sale of the property, consistent with Proposition 13. Direct assessments and special taxes are also considered in the real estate tax calculation. The subject is encumbered by CFD No. 2022-2, CFD No. 1- S, and CFD No. 2018-02, which is presented above. As the subject reflects a single tenant building on a triple net lease, management is estimated at 1% of effective gross income. The expense comparables and our operating expense conclusions for the subject are presented in the following table. 1316
Income Capitalization Approach – North Site 1 88
Perris Logistics Center - North and South Sites
Operating History and Projections
Income
Base Rent $14,153,458
Expense Reimbursements 6,126,477
Potential Gross Income* $20,279,935
Vacancy & Collection Loss @ 3.0% -608,398
Effective Gross Income $19,671,537
Expenses
Real Estate Taxes $3,374,856
CFD No. 2022-2, CFD No. 1-S, CFD No. 2018-02 343,428
Insurance 737,159
Repairs/Maintenance 1,474,319
Management 196,715
Total Expenses $6,126,477
Net Operating Income $13,545,060
Operating Expense Ratio 31.1%
IRR Projection
*IRR projected income is the total potential income attributable to the property before deduction of vacancy and collection loss.
Net Operating Income
Based on the preceding income and expense projections, stabilized net operating income is estimated at $13,545,060, or $13.78 per square foot, per year.
1317
Income Capitalization Approach – North Site 1 89
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Capitalization Rate Selection
A capitalization rate is used to convert net income into an indication of value. Selection of an appropriate capitalization rate considers the future income pattern of the property and investment risk associated with ownership.
In the Sales Comparison Approach section, we analyzed several sales of industrial properties.
Comparables for which capitalization rate data was available are presented in the following table (first three sales). In addition, we compiled capitalization rate information for additional properties in the region that were leased at the time of sale. While the supplemental sales are less similar to the subject than the comparables used in the Sales Comparison Approach section, they are recent leased fee transactions for which we were able to accurately confirm overall capitalization rates. Information from the overall capitalization rate comparables is presented in the following table.
Capitalization Rate Comparables
No. Property Name
Year
Built
Sale
Date Rentable Area
%
Occup.
Effective
Price/SF Cap Rate
1 Sierra Business Center 2024 9/19/2024 690,967 100% $348.26 5.00% 2 4450 E. Lowell St & 3351 E. 1996/1998 5/3/2024 519,116 100% $274.02 5.42% 3 9400-9500 Santa Fe Springs Rd 1979 7/21/2023 595,304 100% $352.76 5.00% 4 6075 Lance Dr 2020 1/18/2023 361,346 100% $332.09 4.30% Indicated Cap Rate Range: 4.30% - 5.42%
Average (Mean) Cap Rate: 4.93%
The overall capitalization rate is the rate at which an investor of an income-producing property will see a return on capital used to buy a particular property/investment. Thus, the capitalization rate can reasonably be viewed as a function of risk. A high risk implies a high possibility of investment loss; a property with high risk will have a high capitalization rate causing a lower selling price or value than one with a relatively low risk factor, all else being equal.
Attributes such as location, building area, visibility/accessibility, condition, effective age and overall quality were taken into account when equating sales and rent comparables to the subject in order to determine market value. The same is true when determining a capitalization rate for the subject property. Also considered when deriving a capitalization rate for an income-producing property is deferred maintenance, security of the income stream (terms of leases and strength of tenants), as well as general economic conditions and local market conditions.
Comparable 1 reflects new construction, similar to the subject. Comparable 2 was leased below market at the time of sale, which applies downward pressure on the cap rate. Comparable 3 had an inplace cap rate of 5.0% and was 100% leased to two tenants, though the proforma cap rate at projected market rates was reported as 6.20%. Comparable 4 reflects recent construction, but transferred in early (January) 2023 and market conditions have weakened since this time.
The subject reflects new construction, pre-leased on a 12 year lease to a single, nationally-recognized credit tenant, both of which apply downward pressure on the cap rate. To determine a capitalization 1318
Income Capitalization Approach – North Site 1 90
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rate for the subject we have also examined capitalization rate information published in national surveys, presented below and on the following page.
Capitalization Rate Surveys - Industrial Properties
IRR-ViewPoint
Year End 2025
National
Industrial
IRR-ViewPoint
Year End 2025
National
Flex Industrial
PwC
2Q-26
National
Warehouse
ACLI
1Q-26
National
Industrial
Range 5.00% - 8.50% 5.00% - 8.75% 4.50% - 6.50% N/A
Average 6.43% 6.95% 5.39% 6.00%
Source: IRR ViewPoint 2026; PwC Investor Survey; American Council of Life Insurers Investment Bulletin.
Industrial Capitalization Rate Trends
PwC - PwC Investor Survey - National Warehouse Market
ACLI - American Council of Life Insurers Investment Bulletin - Industrial Properties 3Q-24 4Q-24 1Q-25 2Q-25 3Q-25 4Q-25 1Q-26 2Q-26
PwC 5.55 5.27 5.08 5.17 5.12 5.38 5.42 5.39
ACLI 5.76 5.38 5.70 5.70 5.70 5.82 6.00
4.50 4.70
4.90 5.10
5.30 5.50
5.70 5.90
6.10 6.30
6.50 Capitalization Rate Conclusion
Based on an analysis of the preceding data, a going-in capitalization rate for the subject is indicated within a range of 4.30% to 6.40%. To reach a capitalization rate conclusion, we consider each of the following investment risk factors to gauge its impact on the rate. The direction of each arrow in the following table indicates our judgment of an upward, downward, or neutral influence of each factor. 1319
Income Capitalization Approach – North Site 1 91
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Capitalization Rate Risk Factors
Factor Issues
Impact
on Rate Comments
Income Characteristics Credit strength of tenant, escalation pattern, above/below market rent,
rollover risk
↓
Though market rent was utilized in this analysis, it is noted the subject property is 100% leased to a single, credit-rated tenant on a 10+ year lease.
Competitive Market Position Construction quality, market appeal, age/condition, functional utility ↓ The subject reflects new construction.
Location Market area demographics and life
cycle trends; proximity issues; access
and support services
↔ The subject is located in Perris, proximate to I-215.
Market Vacancy rates and trends; rental rate
trends; supply and demand ↔
Industrial market conditions have been weakening since
early 2023. The subject's submarket has higher vacancy
rates and lower rental rates than many other Inland Empire submarkets.
Highest and Best Use Upside potential from redevelopment, adaptation, and/or expansion ↔ The subject is currently operating at its highest and best use.
Overall Impact ↔
Accordingly, we conclude a capitalization rate as follows:
Capitalization Rate Conclusion
Method Capitalization Rate Indication
Analysis of Comparable Sales 4.30% - 5.42%
National Investor Surveys 4.00% - 6.50%
Conclusion 5.00%
1320
Income Capitalization Approach – North Site 1 92
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Direct Capitalization Analysis
Net operating income is divided by the capitalization rate to indicate the stabilized value of the subject. Valuation of the subject by direct capitalization is shown in the following table.
Direct Capitalization Analysis
SF Space Type
Rent
Applied $/SF Annual $/SF Bldg.
Income
Base Rent
Medline, Inc 982,879 Industrial Market $14.40 $14,153,458 – Potential Gross Rent 982,879 $14,153,458 $14.40
Expense Reimbursements $6,126,477 $6.23
Potential Gross Income $20,279,935 $20.63
Vacancy & Collection Loss 3.00% -$608,398 -$0.62
Effective Gross Income $19,671,537 $20.01
Expenses
Real Estate Taxes $3,374,856 $3.43
CFD No. 2022-2, CFD No. 1-S, CFD No. 2018-02 $343,428 $0.35 Insurance $737,159 $0.75
Repairs/Maintenance $1,474,319 $1.50
Management 1.00% $196,715 $0.20
Total Expenses $6,126,477 $6.23
Net Operating Income $13,545,060 $13.78
Capitalization Rate 5.00%
Indicated Value $270,901,191 $275.62
Rounded $270,900,000 $275.62
1321
Reconciliation and Conclusion of Value 93
Perris Logistics Center - North and South Sites
Reconciliation and Conclusion of Value
The valuation of the subject includes the following approaches to value.
Sales Comparison Approach
We analyzed several comparable sales of distribution centers in the subject’s market area and surrounding areas. The sales comparison approach is typically most relevant when valuing small, owner-user properties; however, it can be useful in appraising any type of property for which recent market sales data can be obtained. This approach is relevant to the valuation of the subject property because there have been several comparable sales of similar properties. Further, the application of adjustments resulted in a narrowing of the range of data. However, this approach does not directly consider the income-producing potential of the property. Overall, the sales comparison approach is considered a relevant indicator of value for the subject property, but is given secondary weight.
Income Capitalization Approach
Buyers of income-producing real estate rely primarily upon the income capitalization approach when assessing the feasibility of an investment. This approach is highly relevant to the valuation of the subject, since it is an income-producing property. The reliability of this approach is good as we were able to identify several recent leases of comparable properties. The data obtained in estimating vacancy, operating expenses and a capitalization rate for the subject property is considered reliable.
The income capitalization approach provides a credible estimate of value and will be relied upon in the final determination of market value for the subject property.
Conclusion
Overall, the income capitalization approach is deemed more relevant to the analysis because of the quality and quantity of comparables obtained and due to the fact that the subject is managed as a leased asset. Our final conclusion of market value of the subject property is presented below.
Summary of Value Indications - North Site 1
Cost Approach Not Used
Sales Comparison Approach $275,200,000
Income Capitalization Approach $270,900,000
Reconciled $272,000,000
1322
Extraction Analysis – North Site 1 94
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Extraction Analysis – North Site 1
An extraction (residual) analysis is employed to determine the market value of the subject’s North Site 1 building, which is currently under construction. An extraction (residual) analysis takes into account direct and indirect construction costs, accrued depreciation, if any, and developer’s incentive in order to arrive at an estimate of value. The elements of the extraction technique are discussed below.
The market value as if stabilized ($272,000,000) was estimated in the previous sections for the North Site 1. A summary of the market value conclusions is provided below.
Direct and Indirect Construction Costs
The next step in the extraction technique is to analyze the costs associated with the construction of the vertical improvements.
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, 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 builders confirm construction costs have increased over the last several years.
To estimate the direct costs of the North Site 1 improvements, we have employed the August 2026 Marshall & Swift Cost Manual (latest available). Please refer to the tables below for the estimate of total direct construction costs.
Regarding indirect costs, the following list itemizes some of the typical components that generally comprise indirect costs:
Building Improvements - Unit Costs
Building 1 Name:
MVS Building Type: Distribution Warehouses Unit SF Current Multiplier 1.050 Const Class: C Unit Cost $74.50 Local Multiplier 1.190
Quality: Average Sprinklers: $2.28 Story Ht Multiplier 1.788 Quality Rating: Average HVAC Adjust Perimeter Multiplier 0.835 Section/Page 14/23 Other:
Economic Life 55 Subtotal: $76.78 Final Unit Cost $143.23 Source: Marshall Valuation Service
North Site Building 1
Total Building Direct Costs
Building Improvements
Bldg Name MVS Building Type MVS Class Quality Quantity Unit Unit Cost Cost New North Site Building 1 Distribution Warehouse C Average 982,879 SF $143.23 $140,777,759 Subtotal - Building Costs $140,777,759
Source: Marshall Valuation Service except for Indirect Costs and Entrepreneurial Incentive, which are appraiser's estimates. 1323
Extraction Analysis – North Site 1 95
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• 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.
Indirect costs can vary widely as a percentage of the direct costs; a survey of cost budgets suggests indirect costs vary between 8% to more than 30%, depending on the project and tenancy.
Given the size and specifics of the subject, which is a build-to-suit for a pre-leased tenant, we have concluded an indirect cost of 10% of direct costs.
Accrued Depreciation
For new construction on the subject, an allocation for depreciation (physical, functional, or economic) is not applicable.
Developer’s Incentive
According to industry sources, developer’s incentive (profit) historically has ranged anywhere from 5% to 25%. Profit is based on the perceived risk associated with the development. Low profit expectations are typical for projects focused on more affordable product with faster sales rates. Higher profit expectations are common in projects with more risk such as developments where sales rates are slower, project size produces an extended holding period, or the product type is considered weak or untested.
Elements affecting profit include location, supply/demand, anticipated risk, construction time frame and project type. Positive attributes of the subject property include its location adjacent to similarly, newly constructed logistics facilities with good access to the 215 Freeway. Based on the characteristics of the subject property, we estimate developer’s incentive of 10% of the value as if at stabilized occupancy.
Conclusion
Our estimate of the finished subject value is presented below.
Total Building Costs
Building Improvements
Bldg Name MVS Building Type MVS Class Quality Quantity Unit Unit Cost Cost New North Site Building 1 Distribution Warehouse C Average 982,879 SF $143.23 $140,777,759 Subtotal - Building Costs $140,777,759
Plus: Indirect Cost 10% $14,077,776
Subtotal $154,855,535
Plus: Developer's Incentive 10% $15,485,554
Total Building Costs $170,341,089
Source: Marshall Valuation Service except for Indirect Costs and Entrepreneurial Incentive, which are appraiser's estimates. 1324
Extraction Analysis – North Site 1 96
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For the purpose of the extraction technique, based on the current condition of the subject property, we estimate remaining costs at 30% of the total building costs. Deducting the remaining costs from the previously estimated market value as if complete ($272,000,000) suggests a market value of $221,000,000 (rounded).
Value As-Is via Extraction Technique
Total Building Costs $272,000,000
Less: Remaining Developer's Costs 30% ($51,102,327)
Estimated Value As-Is $220,897,673
1325
Market Value by Ownership 97
Perris Logistics Center - North and South Sites
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.
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 CFD No. 2022-2 (Perris Logistics Center), as of the date of value, August 14, 2026, are presented in the following table.
Value Conclusion
Market Value, Subject to a
Hypothetical Condition Ownership Interest Appraised Date of Value Value Conclusion North Site 1 IDI Perris North Fee Simple August 14, 2026 $221,000,000 South Site 1 Anatolia Perris, LLC Fee Simple August 14, 2026 $107,620,000 South Site 2 Silver Hollow, LLC Fee Simple August 14, 2026 $95,060,000 South Site 3 IDIL Perris Fulfillment Center, LP Fee Simple August 14, 2026 $51,440,000 Aggregate of Appraised Values $475,120,000
Assessed Value
North Site 3 Recline Borrower, LLC $191,294,300
North Site 2 IDIL Perris Logistics Center North, LP $166,365,714 Aggregate of Assessed Values $357,660,014
Extraordinary Assumptions and Hypothetical Conditions
(None)
1. The subject property is encumbered by City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center). This appraisal is based on the hypothetical condition that bond proceeds are available to reimburse for certain public improvements and/or Impact Fees completed/paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
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.
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. 1326
Market Value by Ownership 98
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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 industrial market, it is our opinion that the probable exposure time for the subject at the concluded market values stated previously is 6 - 9 months.
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.
Industrial Marketing Time (Months)
IRR-ViewPoint
Year End 2024
National
Industrial
IRR-ViewPoint
Year End 2024
National
Flex Industrial
PwC
2Q-25
National
Warehouse
Range 3 - 12 3 - 12 0 - 12
Average 6.52 7.16 4.2
Source: IRR ViewPoint 2025; PwC Investor Survey.
1327
Certification 99
Perris Logistics Center - North and South Sites
Certification
We certify that, to the best of our knowledge and belief:
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions.
3. 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.
4. We have previously appraised the property that is the subject of this report for the current client. We have provided no other 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. We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.
6. Our engagement in this assignment was not contingent upon developing or reporting predetermined results.
7. 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. 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.
9. 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. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
11. Eric Segal, MAI, made personal inspections of the property that is the subject of this report.
12. No one provided significant real property appraisal assistance to the person(s) signing this certification.
13. We have experience in appraising properties similar to the subject and are in compliance with the Competency Rule of USPAP.
14. As of the date of this report, Eric Segal, MAI, has completed the continuing education program for Designated Members of the Appraisal Institute.
1328
Certification 100
Perris Logistics Center - North and South Sites
Eric Segal, MAI
Certified General Real Estate Appraiser
California Certificate # AG026558
Noah Kauffman, MAI, R/W-AC
Certified General Real Estate Appraiser
California Certificate # 3004618
1329
Assumptions and Limiting Conditions 101
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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. There are no existing judgments or pending or threatened litigation that could affect the value of the property.
3. 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.
4. 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.
5. The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes.
6. 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. An appraisal is inherently subjective and represents our opinion as to the value of the property appraised.
2. 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.
3. No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated.
4. 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. 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.
6. 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 1330
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covers the property as described in this report, and the areas and dimensions set forth are assumed to be correct.
7. 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.
8. 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. 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.
12. 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.
13. 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. 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.
16. 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 1331
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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 nonconforming 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. 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.
20. 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. 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 nonexistent or minimal.
22. 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. The appraisal report and value conclusions for an appraisal assume the satisfactory completion of construction, repairs or alterations in a workmanlike manner.
24. 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 1332
Assumptions and Limiting Conditions 104
Perris Logistics Center - North and South Sites
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. 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.
28. The appraisal is also subject to the following:
1333
Assumptions and Limiting Conditions 105
Perris Logistics Center - North and South Sites
Extraordinary Assumptions and Hypothetical Conditions
(None)
1. The subject property is encumbered by City of Perris Community Facilities District No. 2022-2 (Perris Logistics Center). This appraisal is based on the hypothetical condition that bond proceeds are available to reimburse for certain public improvements and/or Impact Fees completed/paid.
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.
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.
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. 1334
Addenda
Perris Logistics Center - North and South Sites
Addendum A
Appraiser Qualifications
1335
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
1336
Addenda
Perris Logistics Center - North and South Sites
Addendum B
Definitions
1337
Addenda
Perris Logistics Center - North and South Sites
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. The property is subjected to market conditions prevailing as of the date of valuation.
3. Both the buyer and seller are acting prudently and knowledgeably.
4. The seller is under compulsion to sell.
5. The buyer is typically motivated.
6. Both parties are acting in what they consider to be their best interests.
7. An adequate marketing effort will be made during the exposure time.
8. 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 1338
Addenda
Perris Logistics Center - North and South Sites
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)
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Addenda
Perris Logistics Center - North and South Sites
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. Consummation of a sale within a short time period.
2. The property is subjected to market conditions prevailing as of the date of valuation.
3. Both the buyer and seller are acting prudently and knowledgeably.
4. The seller is under extreme compulsion to sell.
5. The buyer is typically motivated.
6. Both parties are acting in what they consider to be their best interests.
7. A normal marketing effort is not possible due to the brief exposure time.
8. 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. 1340
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Perris Logistics Center - North and South Sites
Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal.
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.
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Addenda
Perris Logistics Center - North and South Sites
Addendum C
Maps
1342
EX VACATED
L=244.37
4.42 AC
339.86
ELLIS AVENUE
PAR 4270-2 7TH STREET RS 62/61
1234.17
(M
U
R
RIE
T
TA
VA
C
AT
E
D
R
O
A
D)
64'
1226 6. 4
1764.22
1585.44
74'
N 00-13-15 E
STATE
HWY. RT. 395
R
E
D
L
A
N
D
S
AV
E
N
U
E 44'
70'
30'
343.78
1868.98 180.10
340.04
362.07
7.48 L=277.74 79.25
311.59 209.61
1091.68
357.43
300.13
30'
55.10 AC NT
56.17 AC NT
50.01 AC NT
N 00-20-12 W
N 89-39-31 E
23.84 AC NT
3'
1236.95
1762.15
632.03
PAR 1
PAR 3
PAR 2
464.79 1565.44 322.16 182.64 L=35.89
48.12 3'
44'
LOT E LOT F
47.18 26.10 AC NT
LOT H
LOT A
LOT B
LOT G
LOT I 30'
L=138.08
71.48 45.26
PM 257/19
PM 257/19
PM 257/19
338.56
85.61 34'
64'
886.10
331.19 1193.00
15.95 LO
T
D LO
T
C
DETENTION BASIN
OPEN AREA
PM 257/19
1431.33
1403.72
660.23
1256.07
(15
(16
(14
(18
(17
(05
310-17
ASSESSOR'S MAP BK310 PG. 17
Riverside County, Calif. ANavarrete May 2024
SE 1/4 OF SEC. 32 T.4S, R.3W
SW 1/4 OF SEC. 33 T.4S. R.3W
CITY OF PERRIS
TRA 008-022
16-16
Pg 17 Pg 22
Bk 330
Pg 09
Pg 16
Pg 20
Bk 327
Pg 02
Pg 10 Pg 11 Pg 09
THIS MAP WAS PREPARED FOR ASSESSMENT PURPOSES ONLY. NO LIABILITY IS ASSUMED FOR THE ACCURACY OF THE DATA SHOWN. ASSESSOR'S PARCEL MAY NOT COMPLY WITH LOCAL LOT-SPLIT OR BUILDING SITE ORDINANCES. 32 33
5 ©
1 " = 400 '
1/4
COR
1/4
COR
Legend
Lot Lines
Right-Of-Way
Old Lot Lines
Reference R.O.W
Other Easements
Lease Area
Subdivision Tic Mark
32 1/4
COR
33 Data
G.L.O., RS 62/61-62
STATE HWY MAP815003
Map Reference
PM 257/19 - 26 PARCEL MAP37998
Date Old Number NewNumber
3/1/1973 1 3
7/1/1977 3 4-5
3/1/1983 2 ST
11/20/2001 4 6-8
1/10/2022 8 11-12
1/10/2022 7 9-10
3/22/2024 6, 9-12, 220-57, 58 13
3/22/2024 13 14-18
1343
JS
JS
RS 47/11
RS 47/11
50'
50'
N 89-46-42 E
1291.46 1271 4. 7
374.33
759.16
1288.64
1038.55
121.43 L=663.81 L=338.11 192
1738.24
1312.77 496.43
1319.34
CL OF ROAD VACATED 7/60 64051 (NO WIDTH GIVEN)
TRA 008-010 TRA 008-167
T
R
A 008-107
T
RA 008-107
TRA 008-010
TRA 008-107
SAN JAC. RIV. FLD.
CONT. CHAN.
981.72
TRA 008-107
1312.77 1312.77
FORM
E
R
R.R. R/W
3 2 1
4 6 7 8 9 10
38.87 AC M/L
26.36 AC M/L
20.31 AC M/L
16.09 AC M/L
5 POR PAR 1 POR PAR 1
POR PAR 1
POR PAR 1
A
STREET
70'
70' 100'
100'
CITY OF PERRIS
30 MAPES '
30'
60'
N 00-04-21 W
PAR 22
1.52 AC ML
TRA 008-118
30'
30'
500
17 15
26.88 64'
64'
TRA 008-170
60'
30'
R
O
A
D
1242.03 1059.45
1076.18
1319.34
1306.91
1375.52
24.55 AC ML
49.86 AC ML
G
O
E
T
Z
ROAD 883.60
2591.53 39
17 30
30 153.62
2349.79
141.76
508.70
974.64
298.81
56.95 34
----->
--- >--
----->
--- >--
----->
>-----
----->
--- >--
----->
---- >-
---
----->
>--
25.04 AC ML 53.75 AC ML
11.50 AC ML
38.11 AC ML
(18
(02
(06
(21
(13
(17
(22
(14
(12 (20
(09
(24
(23
(11
(19
330-12
ASSESSOR'S MAP BK330 PG. 12
Riverside County, Calif. Mamta Sahi May 2024
N 1/2 SEC. 7 T.5S, R.3W
CITY OF PERRIS
TRA 008-010
008-107
008-118
008-167
16-49
Pg 12
Pg 13
Pg 08
Pg 14
Bk 342
Pg 24
Pg 06 Pg 10
Bk 342
Pg 08
Bk 342
Pg 35 Pg 15
THIS MAP WAS PREPARED FOR ASSESSMENT PURPOSES ONLY. NO LIABILITY IS ASSUMED FOR THE ACCURACY OF THE DATA SHOWN. ASSESSOR'S PARCEL MAY NOT COMPLY WITH LOCAL LOT-SPLIT OR BUILDING SITE ORDINANCES. ©
1 " = 400 '
Legend
Lot Lines
Right-Of-Way
Old Lot Lines
Reference R.O.W
Other Easements
Lease Area
Subdivision Tic Mark
06 05
08 01 06
12 7
Data
RS 25/8
Map Reference
MB 15/705 SD JOHNSONS SUBDIVISION
RS 47/11
Date Old Number New Number
3/1/1995 01 06-07
1/23/2007 07 12-14
5/5/2021 08 15,ST
5/5/2021 10 16,ST
4/15/2024 03 17-19
4/15/2024 15 20-22
4/15/2024 16 23,24
1344
Addenda
Perris Logistics Center - North and South Sites
Addendum D
Comparable Data
1345
Addenda
Perris Logistics Center - North and South Sites
Land Sales -
1346
Land Sale Profile Sale No. 1
Location & Property Identification
Perris Logistics Center - South
Site 2
Property Name:
Sub-Property Type: Commercial, Industrial
Address: Mapes St.
City/State/Zip: Perris, CA 92571
County: Riverside
Market Orientation: Suburban
IRR Event ID: 3536685
Sale Information
Sale Price: $115,000,000
Effective Sale Price: $115,000,000
Sale Date: 09/25/2025
Sale Status: Closed
$/SF GBA: $112.95
$/SF NRA: $112.95
$/Acre(Gross): $1,762,452
$/Land SF(Gross): $40.46
$/Acre(Usable): $1,762,452
$/Land SF(Usable): $40.46
Grantor/Seller: DSV Real Estate Los Angeles,
LLC
Grantee/Buyer: Silver Hollow LLC
Property Rights: Fee Simple
Financing: Cash to seller
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 2025-0294233
Subsidized/Restricted: No
Verification Type: Secondary Verification
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 330-120-018 & 020
GBA-SF: 1,018,178
NRA-SF: 1,018,178
Acres(Usable/Gross): 65.25/65.25
Land-SF(Usable/Gross): 2,842,290/2,842,290
Usable/Gross Ratio: 1.00
Year Built: 2025
Property Class: A
M&S Class: C
Construction Quality: Average
Improvements Cond.: New
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
Percent Office: 1%
Total Parking Spaces: 349
Park. Ratio 1000 SF GLA: 0.34
Park. Ratio 1000 SF GBA: 0.34
Fire Sprinkler Type: Yes
Air-Conditioning Type: Roof Central Mounted
Roof,Heating,AC Comm.: Built-Up Composition
Shape: Rectangular
Topography: Level
Corner Lot: No
Frontage Type: 2 way, 2 lanes each way
Visibility Rating: Good
Bldg. to Land Ratio FAR: 0.36
Land to Building Ratio: 2.79
Zoning Code: GI
Zoning Desc.: General Industrial
Flood Plain: Yes
Perris Logistics Center - South Site 2
1347
Land Sale Profile Sale No. 1
Improvement and Site Data (Cont'd)
Flood Zone Designation: AE
Comm. Panel No.: 06065C1440H
Date: 08/18/2014
Source of Land Info.: Public Records
Comments
Property sold with entitlements in place for a 1,396,020 SF distribution facility.
Perris Logistics Center - South Site 2
1348
Land Sale Profile Sale No. 2
Location & Property Identification
Perris Logistics Center - South
Site 2
Property Name:
Sub-Property Type: Commercial, Industrial
Address: Mapes St.
City/State/Zip: Perris, CA 92571
County: Riverside
Market Orientation: Suburban
IRR Event ID: 3346658
Sale Information
Sale Price: $106,982,000
Effective Sale Price: $106,982,000
Sale Date: 04/16/2024
Sale Status: Closed
$/SF GBA: $105.07
$/SF NRA: $105.07
$/Acre(Gross): $1,639,571
$/Land SF(Gross): $37.64
$/Acre(Usable): $1,639,571
$/Land SF(Usable): $37.64
Grantor/Seller: IDIL Perris Fulfillment Center,
LP
Grantee/Buyer: DSV Real Estate Los Angeles,
LLC
Property Rights: Fee Simple
% of Interest Conveyed: 100.00
Financing: Cash to seller
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 2024-0110572
Subsidized/Restricted: No
Verified By: Laura Diaz, MAI
Verification Date: 04/01/2025
Verification Type: Confirmed-Seller
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 330-120-018 & 020
GBA-SF: 1,018,178
NRA-SF: 1,018,178
Acres(Usable/Gross): 65.25/65.25
Land-SF(Usable/Gross): 2,842,290/2,842,290
Usable/Gross Ratio: 1.00
Year Built: 2025
Property Class: A
M&S Class: C
Construction Quality: Average
Improvements Cond.: New
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
Percent Office: 1%
Total Parking Spaces: 349
Park. Ratio 1000 SF GLA: 0.34
Park. Ratio 1000 SF GBA: 0.34
Fire Sprinkler Type: Yes
Air-Conditioning Type: Roof Central Mounted
Roof,Heating,AC Comm.: Built-Up Composition
Shape: Rectangular
Topography: Level
Corner Lot: No
Frontage Type: 2 way, 2 lanes each way
Visibility Rating: Good
Bldg. to Land Ratio FAR: 0.36
Perris Logistics Center - South Site 2
1349
Land Sale Profile Sale No. 2
Improvement and Site Data (Cont'd)
Land to Building Ratio: 2.79
Zoning Code: GI
Zoning Desc.: General Industrial
Flood Plain: Yes
Flood Zone Designation: AE
Comm. Panel No.: 06065C1440H
Date: 08/18/2014
Source of Land Info.: Public Records
Comments
Property sold with entitlements in place for a 1,396,020 SF distribution facility. As of April 2025, the buyer's plans are on-hold among current market conditions, and the buyer is evaluating whether to sell or retain the site.
Perris Logistics Center - South Site 2
1350
Land Sale Profile Sale No. 3
Location & Property Identification
Perris Logistics Center - South
Site 1
Property Name:
Sub-Property Type: Commercial, Industrial
Address: Mapes St.
City/State/Zip: Perris, CA 92571
County: Riverside
Market Orientation: Suburban
IRR Event ID: 3346654
Sale Information
Sale Price: $98,874,000
Effective Sale Price: $98,874,000
Sale Date: 04/10/2024
Sale Status: Closed
$/SF GBA: $97.11
$/SF NRA: $97.11
$/Acre(Gross): $1,320,080
$/Land SF(Gross): $30.30
$/Acre(Usable): $1,320,080
$/Land SF(Usable): $30.30
Grantor/Seller: IDIL Perris Fulfillment Center,
LP
Grantee/Buyer: Anatolia Perris, LLC
Property Rights: Fee Simple
% of Interest Conveyed: 100.00
Financing: Cash to seller
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 2024-0104484
Subsidized/Restricted: No
Verified By: Laura Diaz, MAI
Verification Date: 04/01/2025
Verification Type: Confirmed-Seller
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 330-120-002 & 017
GBA-SF: 1,018,178
NRA-SF: 1,018,178
Acres(Usable/Gross): 74.90/74.90
Land-SF(Usable/Gross): 3,262,644/3,262,644
Usable/Gross Ratio: 1.00
Year Built: 2025
Property Class: A
M&S Class: C
Construction Quality: Average
Improvements Cond.: New
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
Percent Office: 1%
Total Parking Spaces: 349
Park. Ratio 1000 SF GLA: 0.34
Park. Ratio 1000 SF GBA: 0.34
Fire Sprinkler Type: Yes
Air-Conditioning Type: Roof Central Mounted
Roof,Heating,AC Comm.: Built-Up Composition
Shape: Rectangular
Topography: Level
Corner Lot: No
Frontage Type: 2 way, 2 lanes each way
Visibility Rating: Good
Bldg. to Land Ratio FAR: 0.31
Perris Logistics Center - South Site 1
1351
Land Sale Profile Sale No. 3
Improvement and Site Data (Cont'd)
Land to Building Ratio: 3.20
Zoning Code: GI
Zoning Desc.: General Industrial
Flood Plain: Yes
Flood Zone Designation: AE
Comm. Panel No.: 06065C1440H
Date: 08/18/2014
Source of Land Info.: Public Records
Comments
Sale of vacant industrial land entitled by the seller for development of a 1,385,090 SF distribution facility. The buyer's plans are on-hold among current market conditions; estimated timing for construction of future improvements is one to three years.
Perris Logistics Center - South Site 1
1352
Land Sale Profile Sale No. 4
Location & Property Identification
Property Name: Barton St
Sub-Property Type: Commercial, Industrial
Address: Barton St.
City/State/Zip: Riverside, CA 92506
County: Riverside
Market Orientation: Industrial Park
IRR Event ID: 3346673
Sale Information
Sale Price: $65,242,000
Effective Sale Price: $65,242,000
Sale Date: 10/26/2023
Recording Date: 10/26/2023
Sale Status: Closed
$/Acre(Gross): $1,341,048
$/Land SF(Gross): $30.79
$/Acre(Usable): $1,883,973
$/Land SF(Usable): $43.25
Grantor/Seller: KB Sycamore Hills I, LLC
Grantee/Buyer: RG Sycamore Riverside, LLC
Property Rights: Fee Simple
% of Interest Conveyed: 100.00
Financing: Cash to seller - buyer obtained
financing
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 0317431
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar, News Article
Improvement and Site Data
MSA: Inland Empire, CA
263-060-022, 263-060-024,
263-060-026
Legal/Tax/Parcel ID:
Acres(Usable/Gross): 34.63/48.65
Land-SF(Usable/Gross): 1,508,483/2,119,194
Usable/Gross Ratio: 0.71
Shape: Irregular
Zoning Code: BMP
Zoning Desc.: Business Park
Source of Land Info.: Other
Comments
Sale of 48.65 acres of land just west of I-215 Freeway; approximately 35 acres of the site is usable, with the
remaining acreage designated for conservation. The buyer is constructing two industrial buildings totaling 603,100 SF, which will be offered for sale or lease.
Barton St
1353
Land Sale Profile Sale No. 5
Location & Property Identification
Property Name: SWC Lowell St & N. Locust Ave
Sub-Property Type: Commercial, Industrial
Address: Lowell St
City/State/Zip: Rialto, CA 92335
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3236296
Sale Information
Sale Price: $72,000,000
Effective Sale Price: $72,000,000
Sale Date: 08/31/2023
Recording Date: 08/31/2023
Sale Status: Closed
$/Acre(Gross): $1,804,059
$/Land SF(Gross): $41.42
$/Acre(Usable): $1,804,059
$/Land SF(Usable): $41.42
Grantor/Seller: BT Property LLC
Grantee/Buyer: IV5 LOCUST GATEWAY
LOGISTICS CENTER LLC
Property Rights: Fee Simple
Financing: Cash to seller
Recording No.: 214334
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar
Sale Analysis
Proposed Use Desc.: Distribution, Industrial
Improvement and Site Data
MSA: Inland Empire
Legal/Tax/Parcel ID: Parcel Number: 0239-192-23
Acres(Gross): 39.91
Land-SF(Usable/Gross): 1,738,480/1,738,480
Frontage Desc.: 584.000 feet on Lowell St.
Zoning Code: I-GM
Zoning Desc.: General Manufacturing
Source of Land Info.: Other
Comments
The 39.91-acre industrial land at Lowell St., Fontana, CA, sold for $72 million on August 31, 2023, at $41.42 per square foot.
Zoned I-GM, the property is vacant and intended for
distribution and industrial development, with 584 feet of frontage on Lowell St. Owned by Brookfield Corporation, the site is located in the San Bernardino Submarket,
approximately 15 miles from Ontario International Airport.
SWC Lowell St & N. Locust Ave
1354
Land Sale Profile Sale No. 6
Location & Property Identification
Property Name: Scott Road Commerce Center
Sub-Property Type: Commercial, Industrial
Address: 33380 Zeiders Rd.
City/State/Zip: Menifee, CA 92584
County: Riverside
Market Orientation: Industrial Park
IRR Event ID: 3346674
Sale Information
Sale Price: $60,841,341
Effective Sale Price: $60,841,341
Sale Date: 02/24/2023
Recording Date: 02/24/2023
Sale Status: Closed
$/Acre(Gross): $1,796,850
$/Land SF(Gross): $41.25
$/Acre(Usable): $1,796,850
$/Land SF(Usable): $41.25
Grantor/Seller: Scott Road Partners, LLC
Grantee/Buyer: Scott Road Property, LLC
Property Rights: Fee Simple
% of Interest Conveyed: 100.00
Financing: Cash to seller - buyer obtained
financing
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 0054236
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar
Sale Analysis
Proposed Use Desc.: Industrial
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
384-150-009, 384-150-010,
384-150-011
Legal/Tax/Parcel ID:
Acres(Usable/Gross): 33.86/33.86
Land-SF(Usable/Gross): 1,474,942/1,474,941
Usable/Gross Ratio: 1.00
Frontage Desc.: 1279.000 feet on Zeiders Rd
Zoning Code: I-P
Zoning Desc.: Industrial Park
Source of Land Info.: Other
Comments
Sale of three contiguous parcels with frontage along I-215.
The property will be developed into the "Gateway at Menifee" logistics campus, which will include three industrial buildings totaling 544,115 SF.
Scott Road Commerce Center
1355
Addenda
Perris Logistics Center - North and South Sites
Improved Sales
1356
Industrial Sale Profile Sale No. 1
Location & Property Identification
Property Name: 1001 Columbia Ave.
Sub-Property Type: Special Purpose Industrial,
Refrigerated/Cold Storage
Address: 1001 Columbia Ave.
City/State/Zip: Riverside, CA 92501
County: Riverside
Market Orientation: Suburban
IRR Event ID: 3538438
Sale Information
Sale Price: $223,000,000
Effective Sale Price: $223,000,000
Sale Date: 01/30/2026
Sale Status: Closed
$/SF GBA: $439.84
$/SF NRA: $439.84
Grantee/Buyer: Walmart Inc.
Assets Sold: Real estate only
Property Rights: Fee Simple
Financing: Cash to seller
Conditions of Sale: Arm's-length
Verification Type: Secondary Verification
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Metropolitan Statistical Area
Legal/Tax/Parcel ID: 249-060-033
GBA-SF: 507,000
NRA-SF: 507,000
Acres(Usable/Gross): 25.33/25.33
Land-SF(Usable/Gross): 1,103,375/1,103,375
Usable/Gross Ratio: 1.00
Year Built: 2011
Property Class: A
Construction Quality: Excellent
Improvements Cond.: Excellent
Exterior Walls: Concrete Precast
No. of Buildings/Stories: 1/1
Ceiling Height Minimum: 42.00
Ceiling Height Maximum: 42.00
No. of Truck Doors: 97
Overhead/Grade/Bay: 1
Percent Office: 4%
Clear Height(Feet): 42.00
Bay/Column Dim.(Feet): 50 x 52
Mezzanine: Yes
Total Parking Spaces: 157
Park. Ratio 1000 SF GLA: 0.31
No. Surface Spaces: 157
Park. Ratio 1000 SF GBA: 0.31
Fire Sprinkler Type: Yes
Shape: Rectangular
Topography: Level
Corner Lot: No
Frontage Feet: 914
Frontage Desc.: Columbia Ave.
Bldg. to Land Ratio FAR: 0.46
Land to Building Ratio: 2.18
Zoning Code: City of Riverside
Zoning Desc.: BMP, Business Manufacturing
Park (Hunter BPSP)
Bldg. Phy. Info. Source: Other
1001 Columbia Ave.
1357
Industrial Sale Profile Sale No. 1
Improvement and Site Data (Cont'd)
Source of Land Info.: Public Records
Comments
Sale of a 2011-build industrial/cold storage facility, totaling 507,000 square feet. The property sold to Walmart, the sole occupant of the building at the time of sale. The building features 42' clear heights and a 4.4% office build-out ratio. 1001 Columbia Ave.
1358
Industrial Sale Profile Sale No. 2
Location & Property Identification
Property Name: 21600 Cactus Ave
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 21600 Cactus Ave.
City/State/Zip: Riverside, CA 92518
County: Riverside
Market Orientation: Industrial Park
IRR Event ID: 3346401
Sale Information
Sale Price: $257,050,000
Effective Sale Price: $257,050,000
Sale Date: 03/21/2025
Recording Date: 03/21/2025
Sale Status: Closed
$/SF GBA: $289.00
$/SF NRA: $289.00
Grantor/Seller: Mp Core Investor, LLC
Grantee/Buyer: Burlington Distribution
Riverside, LLC
Property Rights: Fee Simple
% of Interest Conveyed: 100.00
Financing: Cash to seller
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 0084871
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar, News Article
Occupancy
Occupancy Type Before Sale: Single Tenant
Occupancy Type After Sale: Owner Occupied
Occupancy at Time of Sale: 100.00%
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 297-100-084
GBA-SF: 889,445
NRA-SF: 889,445
Acres(Usable/Gross): 52.44/52.44
Land-SF(Usable/Gross): 2,284,286/2,284,286
Usable/Gross Ratio: 1.00
Year Built: 2019
Property Class: A
M&S Class: C
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
Ceiling Height Minimum: 40.00
No. of Truck Doors: 220
Total Parking Spaces: 589
Park. Ratio 1000 SF GLA: 0.66
Park. Ratio 1000 SF GBA: 0.66
Bldg. to Land Ratio FAR: 0.39
Land to Building Ratio: 2.57
Zoning Desc.: I
Source of Land Info.: Other
Comments
Sale of distribution center to tenant, Burlington Distribution.
The improvements have 220 dock-high doors and 40 ft clear ceiling heights.
21600 Cactus Ave
1359
Industrial Sale Profile Sale No. 3
Location & Property Identification
Property Name: Sierra Business Center
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 16604 Slover Ave
City/State/Zip: Fontana, CA 92337
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3297024
Sale Information
Sale Price: $240,637,500
Effective Sale Price: $240,637,500
Sale Date: 09/19/2024
Recording Date: 09/19/2024
Sale Status: Closed
$/SF GBA: $348.26
$/SF NRA: $348.26
Grantor/Seller: Sierra Avenue Industrial Llc
Grantee/Buyer: Sierra Business Center ILP, LLC
Property Rights: Leased Fee
Financing: Cash to seller
Recording No.: 223662
Verified By: Sean Morrow, MAI
Verification Date: 11/14/2024
Verification Type: Confirmed-Buyer Broker
Secondary Verific. Source: CoStar
Operating Data and Key Indicators
Cap Rate - Reported: 5.00%
Occupancy
Occupancy Type Before Sale: Single Tenant
Occupancy Type After Sale: Single Tenant
Occupancy at Time of Sale: 100.00%
Number of Tenants at T.O.S.: 1
Improvement and Site Data
MSA: Inland Empire
Parcel Numbers: 0251-172-04,
0251-181-38
Legal/Tax/Parcel ID:
GBA-SF: 690,967
NRA-SF: 690,967
Acres(Gross): 32.30
Land-SF(Gross): 1,406,988
Year Built: 2024
Property Class: A
Construction Desc.: Concrete
Multi-Tenant/Condo.: No/No
Ceiling Height Minimum: 40.00
Ceiling Height Maximum: 40.00
No. of Truck Doors: 92
Overhead/Grade/Bay: 4
Percent Office: 1%
Clear Height(Feet): 40.00
Park. Ratio 1000 SF GLA: 4.00
Park. Ratio 1000 SF GBA: 4.00
Fire Sprinkler Type: ESFR
Bldg. to Land Ratio FAR: 0.49
Land to Building Ratio: 2.04
Zoning Desc.: M1
Source of Land Info.: Other
Sierra Business Center
1360
Industrial Sale Profile Sale No. 3
Comments
Newly-constructed single tenant industrial building. The property is located approximately 0.5 miles from freeway access and has 1.4 doors per 10,000 SF. The building is cross-docked, with one truck court approximately 250 feet deep and the second approximately 180 feet deep.
Sierra Business Center
1361
Industrial Sale Profile Sale No. 4
Location & Property Identification
4450 E. Lowell St & 3351 E.
Philadelphia St
Property Name:
Sub-Property Type: Warehouse, Distribution
Warehouse
4450 E. Lowell St & 3351 E.
Philadelphia St
Address:
City/State/Zip: Ontario, CA 91761-2220
County: San Bernardino
Market Orientation: Suburban
IRR Event ID: 3238247
Sale Information
Sale Price: $142,250,000
Effective Sale Price: $142,250,000
Sale Date: 05/03/2024
Recording Date: 05/03/2024
Sale Status: Closed
$/SF GBA: $274.02
$/SF NRA: $274.02
Property Rights: Leased Fee
Financing: Cash to seller - buyer obtained
financing
Recording No.: 103970
Verified By: Sean Morrow, MAI
Verification Date: 05/28/2024
Verification Type: Confirmed-Seller Broker
Secondary Verific. Source: CoStar
Operating Data and Key Indicators
Cap Rate - Reported: 5.42%
Occupancy
Occupancy Type Before Sale: Multi-Tenant
Occupancy Type After Sale: Multi-Tenant
Occupancy at Time of Sale: 100.00%
Improvement and Site Data
MSA: Inland Empire
Parcel Numbers: 0238-201-33,
0211-275-38
Legal/Tax/Parcel ID:
GBA-SF: 519,116
NRA-SF: 519,116
Acres(Gross): 24.67
Land-SF(Gross): 1,074,625
Year Built: 1996/1998
Property Class: B
Improvements Cond.: Good
Construction Desc.: Reinforced Concrete
No. of Buildings/Stories: 2/1
Multi-Tenant/Condo.: No/No
Ceiling Height Minimum: 30.00
Ceiling Height Maximum: 30.00
No. of Truck Doors: 89
Overhead/Grade/Bay: 3
Percent Office: 2%
Clear Height(Feet): 30.00
Total Parking Spaces: 320
Park. Ratio 1000 SF GLA: 0.62
Park. Ratio 1000 SF GBA: 0.62
Fire Sprinkler Type: Wet
Frontage Desc.: 934.000 feet on Lowell
4450 E. Lowell St & 3351 E. Philadelphia St
1362
Industrial Sale Profile Sale No. 4
Improvement and Site Data (Cont'd)
Bldg. to Land Ratio FAR: 0.48
Land to Building Ratio: 2.07
Zoning Desc.: SP
Source of Land Info.: Other
Comments
Sale of two non-contiguous properties that sold as a single transaction. The buildings are similar in quality, age and condition. They are located 0.4 to 0.5 miles from freeway access and have a combined total of 1.7 doors per 10,000 SF.
Both truck have truck courts that are approximately 160 feet deep. Brokers believed rents to be approximately 15% below market with weighted average lease term of 2.9 years.
4450 E. Lowell St & 3351 E. Philadelphia St
1363
Industrial Sale Profile Sale No. 5
Location & Property Identification
Property Name: 13423-13473 Santa Ana Ave.
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 13423 Santa Ana Ave.
City/State/Zip: Fontana, CA 92337
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3238268
Sale Information
Sale Price: $197,000,000
Effective Sale Price: $197,000,000
Sale Date: 04/02/2024
Recording Date: 04/02/2024
Sale Status: Closed
$/SF GBA: $240.54
$/SF NRA: $240.54
Grantor/Seller: Hancock REIT Commerce Way
LLC
Grantee/Buyer: Exeter 13423-13473 Santa
Ana (2024), LLC
Property Rights: Leased Fee
Financing: Cash to seller
Recording No.: 073228
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar
Occupancy
Occupancy Type Before Sale: Multi-Tenant
Occupancy Type After Sale: Multi-Tenant
Occupancy at Time of Sale: 70.00%
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Metropolitan Statistical Area
Legal/Tax/Parcel ID: 0238-111-47
GBA-SF: 819,004
NRA-SF: 819,004
Acres(Usable/Gross): 35.82/35.82
Land-SF(Usable/Gross): 1,560,319/1,560,319
Usable/Gross Ratio: 1.00
Year Built: 2000
Property Class: B
M&S Class: B
Construction Quality: Average
Improvements Cond.: Average
Exterior Walls: Concrete Precast
Construction Desc.: Concrete tilt-up
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: Yes/No
Ceiling Height Minimum: 30.00
No. of Truck Doors: 130
Overhead/Grade/Bay: 4
Percent Office: 1%
Clear Height(Feet): 30.00
Total Parking Spaces: 350
Park. Ratio 1000 SF GLA: 0.43
Park. Ratio 1000 SF GBA: 0.43
Fire Sprinkler Type: Yes
Shape: Rectangular
Topography: Level
Bldg. to Land Ratio FAR: 0.52
Land to Building Ratio: 1.91
13423-13473 Santa Ana Ave.
1364
Industrial Sale Profile Sale No. 5
Improvement and Site Data (Cont'd)
Zoning Code: M-2
Zoning Desc.: General Industrial
Bldg. Phy. Info. Source: Broker
Source of Land Info.: Other
Comments
Property is located approximately 1.4 miles from freeway access and has 1.6 doors per 10,000 SF. The truck court is approximately 200 feet. It was reportedly 70% occupied at sale.
13423-13473 Santa Ana Ave.
1365
Industrial Sale Profile Sale No. 6
Location & Property Identification
Home Depot Distribution
Center
Property Name:
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 400 Ellis Ave.
City/State/Zip: Perris, CA 92570
County: Riverside
Market Orientation: Industrial Park
IRR Event ID: 3346417
Sale Information
Sale Price: $183,866,500
Effective Sale Price: $183,866,500
Sale Date: 12/14/2023
Sale Status: Closed
$/SF GBA: $229.97
$/SF NRA: $229.97
Grantor/Seller: IDIL Perris North 3, LP
Grantee/Buyer: Recline Borrower, LLC
Property Rights: Leased Fee
% of Interest Conveyed: 100.00
Financing: Cash to seller
Conditions of Sale: Arm's-length
Document Type: Deed
Recording No.: 2023-0371159
Verified By: Laura Diaz, MAI
Verification Date: 04/01/2025
Verification Type: Confirmed-Seller
Operating Data and Key Indicators
Cap Rate - Reported: 5.11%
Occupancy
Occupancy Type After Sale: Single Tenant
Occupancy at Time of Sale: 100.00%
Lease Type: Triple Net
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 310-170-016
GBA-SF: 799,522
NRA-SF: 799,522
Acres(Usable/Gross): 55.10/55.10
Land-SF(Usable/Gross): 2,399,982/2,399,982
Usable/Gross Ratio: 1.00
Year Built: 2023
Property Class: A
M&S Class: C
Exterior Walls: Concrete Precast
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
No. of Truck Doors: 27
Overhead/Grade/Bay: 7
Percent Office: 1%
Clear Height(Feet): 40.00
Air-Conditioning Type: Roof Central Mounted
Bldg. to Land Ratio FAR: 0.33
Land to Building Ratio: 3.00
Zoning Code: LI
Zoning Desc.: Light Industrial
Flood Plain: Yes
Home Depot Distribution Center
1366
Industrial Sale Profile Sale No. 6
Improvement and Site Data (Cont'd)
Source of Land Info.: Public Records
Comments
Property was 100% leased to Home Depot on a 20-year term at the time of sale. The property includes a rail spur that runs through the property. Reportedly, the rental rate of
approximately $1.00 psf/month, NNN, was based on a 4.75% yield on cost.
Home Depot Distribution Center
1367
Industrial Sale Profile Sale No. 7
Location & Property Identification
Property Name: Sierra Business Park - Bldg 5
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 10545 Production Ave
City/State/Zip: Fontana, CA 92337
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3032007
Sale Information
Sale Price: $365,000,000
Effective Sale Price: $365,000,000
Sale Date: 01/30/2023
Recording Date: 01/30/2023
Sale Status: Closed
$/SF GBA: $331.26
$/SF NRA: $331.26
Grantee/Buyer: Rexford Industrial 10545
Production Llc
Terms of Sale Comments: Sale Leaseback
Recording No.: 020837
Verification Type: Secondary Verification
Secondary Verific. Source: CoStar
Occupancy
Occupancy Type Before Sale: Single Tenant
Number of Tenants at T.O.S.: 1
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 0255-061-28
GBA-SF: 1,101,840
NRA-SF: 1,101,840
Acres(Usable/Gross): 45.90/45.90
Land-SF(Usable/Gross): 1,999,404/1,999,404
Usable/Gross Ratio: 1.00
Year Built: 2006
Property Class: A
Improvements Cond.: Excellent
Construction Desc.: Reinforced Concrete
Multi-Tenant/Condo.: No/No
Ceiling Height Minimum: 32.00
Ceiling Height Maximum: 32.00
Overhead/Grade/Bay: 4
Truck Door Comments: 220 Loading Docks
Percent Office: 10%
Total Parking Spaces: 640
Park. Ratio 1000 SF GLA: 0.58
Park. Ratio 1000 SF GBA: 0.58
Fire Sprinkler Type: ESFR
Bldg. to Land Ratio FAR: 0.55
Land to Building Ratio: 1.81
Zoning Desc.: M-1
Source of Land Info.: Other
Comments
On January 30th, 2023 10545 Production Ave Fontana, CA
92337 sold for $365MM or $331.26 SF.
This property sold as a single tenant, sale leaseback
transaction, & consisted of 1,101,840 SF in a single building.
Sierra Business Park - Bldg 5
1368
Industrial Sale Profile Sale No. 7
Comments (Cont'd)
Rexford Industrial reported an initial unlevered yield on total investment at 5%. CoStar is utilizing the unlevered yield as the first year pro forma for a rate of 5% due to this property being a single tenant, sale leaseback transaction.
The details of this transaction have been verified by sources deemed reliable.
Features 220 dock high doors.
Sierra Business Park - Bldg 5
1369
Addenda
Perris Logistics Center - North and South Sites
Lease Comparables
1370
Industrial Lease Profile Lease No. 1
Location & Property Identification
Property Name: Sierra Business Park - Bldg 5
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 10545 Production Ave
City/State/Zip: Fontana, CA 92337
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3345929
Space Information
Space Type: Industrial
Full Building Lease: Yes
Leased Area: 1,101,840
% Office (leased space): 10%
Lease Information
Lease Status: Signed Lease
Lessee: Tireco, Inc.
Start/Available Date: 02/01/2025
Term of Lease: 24 months
Lease Measure: $/SF/Mo
Face Rental Rate: $1.46
Effective Rental Rate: $1.37
Escalation Type: Fixed Percentage
Escalation Desc.: 4% annually
TI Type: Renewal Tenant
Free Rent (Months): 2.00
Verification Source: CBRE
Transaction Reliability: Verified
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 0255-061-28
GBA-SF: 1,101,840
NRA-SF: 1,101,840
Acres(Usable/Gross): 45.90/45.90
Land-SF(Usable/Gross): 1,999,404/1,999,404
Usable/Gross Ratio: 1.00
Year Built: 2006
Property Class: A
Improvements Cond.: Excellent
Construction Desc.: Reinforced Concrete
Multi-Tenant/Condo.: No/No
Overhead/Grade/Bay: 4.00
Truck Door Comments: 220 Loading Docks
Percent Office: 10.00
Total Parking Spaces: 640
Park. Ratio 1000 SF GLA: 0.58
Park. Ratio 1000 SF GBA: 0.58
Fire Sprinkler Type: ESFR
Bldg. to Land Ratio FAR: 0.55
Land to Building Ratio: 1.81
Zoning Desc.: M-1
Source of Land Info.: Other
Comments
Features 220 dock high doors.
Two-year lease renewal of a warehouse/distribution facility; tenant received two months of free rent and no TI allowance.
The space has clear ceiling heights of 32 feet, 220 dock-high doors, and 4 grade-level doors.
Sierra Business Park - Bldg 5
1371
Industrial Lease Profile Lease No. 2
Location & Property Identification
Property Name: Perris Distribution Center
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 3722 N. Redlands Ave.
City/State/Zip: Perris, CA 92571
County: Riverside
Market Orientation: Suburban
IRR Event ID: 3346090
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 1,686,590
Lease Information
Lease Status: Signed Lease
Lessee: Whirlpool
Start/Available Date: 01/01/2025
Expiration Date: 01/31/2032
Term of Lease: 85 months
Lease Measure: $/SF/Mo
Face Rental Rate: $1.08
Effective Rental Rate: $1.21
Escalation Type: Fixed Percentage
Escalation Desc.: 4% annually
TI Allowance ($/SF): $1.50
TI Type: Renewal Tenant
Free Rent (Months): 1.00
Transaction Reliability: Verified
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 303-110-001
GBA-SF: 1,686,590
NRA-SF: 1,686,590
Acres(Usable/Gross): 83.52/83.52
Land-SF(Usable/Gross): 3,638,131/3,638,131
Usable/Gross Ratio: 1.00
Year Built: 2006
Property Class: A
M&S Class: C
Exterior Walls: Concrete Precast
No. of Buildings/Stories: 1/1
Multi-Tenant/Condo.: No/No
No. of Truck Doors: 277.00
Overhead/Grade/Bay: 4.00
Percent Office: 1.20
Clear Height(Feet): 30.00
Bay/Column Dim.(Feet): 52' x 62'
Power Desc: 2,000 - 6,000a/277 - 480v
Total Parking Spaces: 202
Park. Ratio 1000 SF GLA: 0.12
Park. Ratio 1000 SF GBA: 0.12
Shape: Rectangular
Bldg. to Land Ratio FAR: 0.46
Land to Building Ratio: 2.16
Zoning Code: LI
Zoning Desc.: Light Industrial
Source of Land Info.: Other
Comments
Lease renewal to Whirlpool. The tenant received one month of free rent and a $1.50 psf TI allowance. The space includes 277 dock-high doors, 4 grade-level doors, and
Perris Distribution Center
1372
Industrial Lease Profile Lease No. 2
Comments (Cont'd)
1.2% office space. Clear ceiling heights are 30 feet.
Perris Distribution Center
1373
Industrial Lease Profile Lease No. 3
Location & Property Identification
Property Name: 3412 Manitou Ct
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 3412 Manitou Ct.
City/State/Zip: Jurupa Valley, CA 91752
County: Riverside
Market Orientation: Industrial Park
IRR Event ID: 3333096
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 560,025
% Office (leased space): 1%
Ceiling Height (ft): 40.00
Lease Information
Lease Status: Signed Lease
Lessee: White Horse Logistics
Start/Available Date: 07/01/2025
Term of Lease: 127 months
Lease Measure: $/SF/Yr
Face Rental Rate: $15.48
Effective Rental Rate: $15.48
Escalation Type: Fixed Percentage
Escalation Desc.: 3.5%
TI Allowance ($/SF): $4.01
Free Rent (Months): 7.00
Verified by: Sean Morrow, MAI
Verification Date: 02/28/2025
Verification Source: CBRE
Transaction Reliability: Confirmed
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
Legal/Tax/Parcel ID: 156-150-073
GBA-SF: 560,025
NRA-SF: 560,025
Acres(Gross): 26.00
Land-SF(Gross): 1,132,560
Year Built: 2024
Property Class: A
Construction Desc.: Concrete tilt-up
Ceiling Height: 40.00
No. of Truck Doors: 79.00
Overhead/Grade/Bay: 4.00
Clear Height(Feet): 40.00
Bldg. to Land Ratio FAR: 0.49
Land to Building Ratio: 2.02
Source of Land Info.: Other
Comments
Building has 79 dock-high doors and four grade-level doors. 3412 Manitou Ct
1374
Industrial Lease Profile Lease No. 4
Location & Property Identification
Property Name: Building A
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 12300 Riverside Dr
City/State/Zip: Eastvale, CA 91752-1006
County: Riverside
IRR Event ID: 3333099
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 557,500
% Office (leased space): 2%
Lease Information
Lease Status: Signed Lease
Lessee: LC Logistics Services
Start/Available Date: 04/01/2025
Term of Lease: 91 months
Lease Measure: $/SF/Yr
Face Rental Rate: $13.50
Effective Rental Rate: $13.50
Escalation Type: Fixed Percentage
Escalation Desc.: 3.75%
TI Allowance ($/SF): $1.00
Free Rent (Months): 6.00
Verified by: Sean Morrow, MAI
Verification Date: 02/28/2025
Verification Source: CBRE
Transaction Reliability: Confirmed
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Inland Empire
Legal/Tax/Parcel ID: Por NW4 sec 7 TS2 R6W
SBB&M
Parcel Number(s):
156-040-064, 156-040-064
GBA-SF: 557,500
NRA-SF: 557,500
Acres(Gross): 26.77
Land-SF(Gross): 1,166,101
Year Built: 1998
Property Class: A
Construction Desc.: Masonry
Truck Door Comments: 109 Loading Docks
Total Parking Spaces: 418
Park. Ratio 1000 SF GLA: 0.75
Park. Ratio 1000 SF GBA: 0.75
Fire Sprinkler Type: ESFR
Frontage Desc.: 800.000 feet on Riverside
Bldg. to Land Ratio FAR: 0.48
Land to Building Ratio: 2.09
Zoning Desc.: I-P
Source of Land Info.: Other
Comments
Part of the 107-acre master planned Park Mira Loma West Industrial Park this distribution facility is located minutes from the Ontario International Airport and offers excellent freeway visibility and access to I-10, I-15, and 60 freeways. Corporate neighbors include Syratech, UPS, Toyota, Baxter, Honda, Home Deport, Costco, Michelin, BMW, and Toyo Tire. Amenities include 130' truck court, offices to suit, power to suit, and loading dock dimensions
Building A
1375
Industrial Lease Profile Lease No. 4
Comments (Cont'd)
of (9) 8'6" x 10'. Building is expandable to 900,000 square feet.
Approximate travel times: Downtown Los Angeles: 45
minutes, Orange County Airport: 45 minutes, Ontario
International Airport: 5 minutes, Port of L.A. and Long Beach:
45 minutes.
Building has 109 dock-high doors and four grade-level doors.
Building A
1376
Industrial Lease Profile Lease No. 5
Location & Property Identification
Ontario Mills Distribution
Center
Property Name:
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 5125 Ontario Mills Pky
City/State/Zip: Ontario, CA 91764
County: San Bernardino
Market Orientation: Industrial Park
IRR Event ID: 3333101
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 520,161
% Office (leased space): 1%
Ceiling Height (ft): 32.00
Lease Information
Lease Status: Signed Lease
Lessee: Owens & Minor
Start/Available Date: 01/01/2025
Term of Lease: 60 months
Lease Measure: $/SF/Yr
Face Rental Rate: $16.80
Effective Rental Rate: $16.80
Escalation Type: Fixed Percentage
Escalation Desc.: 3.75%
TI Allowance ($/SF): $4.00
Verified by: Sean Morrow, MAI
Verification Date: 02/28/2025
Verification Source: CBRE
Transaction Reliability: Confirmed
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Inland Empire
Legal/Tax/Parcel ID: Parcel Number: 0238-021-02
GBA-SF: 520,161
NRA-SF: 520,161
Acres(Gross): 24.80
Land-SF(Gross): 1,080,288
Year Built: 2013
Property Class: A
Improvements Cond.: Excellent
Construction Desc.: Reinforced Concrete
Multi-Tenant/Condo.: No/No
Ceiling Height: 32.00
No. of Truck Doors: 106.00
Overhead/Grade/Bay: 4.00
Percent Office: 0.80
Clear Height(Feet): 32.00
Total Parking Spaces: 389
Park. Ratio 1000 SF GLA: 0.75
Park. Ratio 1000 SF GBA: 0.75
Fire Sprinkler Type: ESFR
Bldg. to Land Ratio FAR: 0.48
Land to Building Ratio: 2.08
Zoning Desc.: C
Source of Land Info.: Other
Comments
Building is located 0.9 miles from access to I-10, and also has good access to I-15. The building is LEED-certified. There are
2.1 doors per 10,000 SF. The building has approximately 190 foot truck courts. Tenant was given
Ontario Mills Distribution Center
1377
Industrial Lease Profile Lease No. 5
Comments (Cont'd)
$4.00 per square foot for tenant improvements, with no free rent on a 60 month term. Escalations are 3.75% annually.
Ontario Mills Distribution Center
1378
Industrial Lease Profile Lease No. 6
Location & Property Identification
Property Name: Bldg 2
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 3510 E. Francis Ave
City/State/Zip: Ontario, CA 91761-2927
County: San Bernardino
IRR Event ID: 3333094
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 562,089
% Office (leased space): 2%
Lease Information
Lease Status: Signed Lease
Lessee: Gigacloud Technology
Start/Available Date: 07/01/2024
Term of Lease: 68 months
Lease Measure: $/SF/Yr
Face Rental Rate: $13.20
Effective Rental Rate: $13.20
Escalation Type: Fixed Percentage
Escalation Desc.: 4%
TI Allowance ($/SF): $3.00
Free Rent (Months): 8.00
Verified by: Sean Morrow, MAI
Verification Date: 02/28/2025
Verification Source: CBRE
Transaction Reliability: Confirmed
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Inland Empire
Legal/Tax/Parcel ID: Parcel Number(s):
0211-281-57, 0211-281-57
GBA-SF: 562,089
NRA-SF: 562,089
Acres(Gross): 26.49
Land-SF(Gross): 1,153,854
Year Built: 2008
Property Class: A
Improvements Cond.: Good
Construction Desc.: Reinforced Concrete
Truck Door Comments: 96 Loading Docks
Percent Office: 0.39
Total Parking Spaces: 417
Park. Ratio 1000 SF GLA: 0.74
Park. Ratio 1000 SF GBA: 0.74
Fire Sprinkler Type: ESFR
Bldg. to Land Ratio FAR: 0.49
Land to Building Ratio: 2.05
Zoning Desc.: C2
Source of Land Info.: Other
Comments
ProLogis Park Ontario Airport consists of 6 freestanding buildings totaling 2 million SF. With access to the I-10, I-15, and SR 60. Located near the Ontario International Airport, restaurants, and retail nearby at the Ontario Mills and Victoria Gardens. Convenient access to world ports of Los Angeles and Long Beach. All of the buildings have secured yards.
Includes 2.5% skylights & 24 trailer stalls.
Bldg 2
1379
Industrial Lease Profile Lease No. 6
Comments (Cont'd)
Suite has 96 dock-high doors and four grade-level doors.
Bldg 2
1380
Industrial Lease Profile Lease No. 7
Location & Property Identification
Property Name: 13277 San Bernardino Ave.
Sub-Property Type: Warehouse, Distribution
Warehouse
Address: 13277 San Bernardino Ave.
City/State/Zip: Fontana, CA 92335
County: San Bernardino
Market Orientation: Rural
IRR Event ID: 3333068
Space Information
Space Type: Warehouse
Full Building Lease: Yes
Leased Area: 577,905
% Office (leased space): 1%
Lease Information
Lease Status: Signed Lease
Lessee: Western Post
Start/Available Date: 07/01/2024
Term of Lease: 126 months
Lease Measure: $/SF/Yr
Face Rental Rate: $13.20
Effective Rental Rate: $13.20
Escalation Type: Fixed Percentage
Escalation Desc.: 4%
Free Rent (Months): 6.00
Verified by: Sean Morrow, MAI
Verification Date: 07/01/2024
Verification Source: CBRE
Transaction Reliability: Confirmed
Lease Expense Information
Reimbursement Method: Triple Net
Improvement and Site Data
MSA: Riverside-San
Bernardino-Ontario, CA
Legal/Tax/Parcel ID: 0238-031-27
GBA-SF: 577,905
NRA-SF: 577,905
Acres(Usable/Gross): 26.20/26.20
Land-SF(Usable/Gross): 1,141,272/1,141,272
Usable/Gross Ratio: 1.00
Year Built: 2002
Property Class: B
No. of Buildings/Stories: 1/1
No. of Truck Doors: 96.00
Clear Height(Feet): 30.00
Total Parking Spaces: 179
Park. Ratio 1000 SF GLA: 0.31
Park. Ratio 1000 SF GBA: 0.31
Topography: Level
Bldg. to Land Ratio FAR: 0.51
Land to Building Ratio: 1.97
Zoning Code: KC/SP
Utilities: Electricity, Water Public,
Sewer, Gas, Telephone
Bldg. Phy. Info. Source: Public Records
Source of Land Info.: Public Records
Comments
Building has 85 dock-high doors and four grade-level doors. 13277 San Bernardino Ave.
1381