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FCEDA RAIL PARK FCEDA Full Rail Park 060115 TWENTY (20) YEAR ANALYSIS - CONSTRUCTION OF PARK FCEDA Rail Served Industrial Park SQUARE FOOTAGE: 1,742,400 TOTAL PROJECT COSTS PER LEASABLE SQUARE FOOT (32.4 ACRES): $0.41 $571,814 PROJECT EQUITY REQUIRED \ PERCENTAGE OF PROJ. COST -31.16% ($178,186) DEV EQUITY REQUIRED \ PERCENTAGE OF PROJ. COST ($178,186) STABILIZED NET OPERATING INCOME - 3RD YEAR $436,347 DEVELOPER'S PROJECTED FINANCIAL RETURNS: PROJECT YIELD BEFORE DEBT SERVICE(noi/proj cost) 76.31% PRE TAX IRR #NUM! PROJECT AREAS: TOTAL FCEDA LAND 40 ACRES (SURFACE SQ FT - 1 acre) 1,889,633 LEASABLE FCEDA LAND 32.4 ACRES 1,411,344 WILLDAN FINANCIAL SERVICES - CONFIDENTIAL 1 OperExp&SoftCosts 6/4/2015, 10:20 AM ---PAGE BREAK--- FCEDA RAIL PARK FCEDA Full Rail Park 060115 FINANCIAL ASSUMPTIONS: INTERIM LOAN-(FEE/RATE) 1.50% 4.00% PERMANENT LOAN- (FEE/RATE) 1.50% 4.00% LAND CARRY (TERM MOS/RATE) 0 0.00% DEBT COVERAGE (AMOUNT/COVERAGE) $8,726,946 1.25 LOAN TO VALUE RATIO (AMOUNT/RATIO) $7,272,455 100.0% LOAN AMOUNT 750,000 $ CAPITALIZATION RATE 6.00% CREDIT LOSS 0.00% INFLATION FACTOR (RENT/EXPENSES) 0.00% 0.00% MARKETING ASSUMPTIONS: NNN MARKET RENT NON RECOV OPER SQ FT NET RENT (RENTABLE SQ FT) LEASING COMMISSION TIMING ASSUMPTIONS (in Months): INITIAL PRE-DEVELOPMENT 9 CONSTRUCTION 18 LEASE-UP (AVERAGE INITIAL VACANCY) 33 FREE RENT 0 MONTHS TO STABILIZED INCOME 60 WILLDAN FINANCIAL SERVICES - CONFIDENTIAL 2 OperExp&SoftCosts 6/4/2015, 10:20 AM ---PAGE BREAK--- FCEDA RAIL PARK FCEDA Full Rail Park 060115 PROJECT COST AREA PER SQ FT TOTAL LAND ACQUISTION 1,889,633 0.67 1,266,054 FCEDA LAND VALUE CONTRIBUTION 1,889,633 (0.50) (944,816) FCEDA PROJECT CONTRIBUTION 1,889,633 (3.27) (6,175,374) Construction: MOBILIZATION 0.38 716,000 WATER INFRASTRUCTURE 0.51 972,356 WASTEWATER INFRASTRUCTURE 0.30 570,000 STORM WATER INFRASTRUCTURE 0.28 529,940 MISCELLANEOUS UTILITIES 0.16 310,000 GRADING 1.76 3,326,587 ROAD AND ACCESS IMPROVEMENTS 1.39 2,620,852 ON-SITE RAIL 1.66 3,131,260 MULTI-USE TRAIL DEVELOPMENT 2.15 4,062,000 OFF SITE RAIL 0.62 1,175,780 CITY OF KALISPELL CONTRIBUTION (2.38) (4,500,000) BNSF CONTRIBUTION (0.26) (500,000) TIGER FUNDING (5.29) (10,000,000) TRAIL DESIGN 0.17 325,000 PERMIT FEE 0.01 20,000 ENVIRONMENTAL, SURVEYING & ENGINEERING 0.92 1,741,500 TOTAL CONSTRUCTION & ACQUISITON COSTS (0.72) $ (1,352,861) $ PERMANENT LOAN FEES -0.83% 0.01 11,250 INTERIM LOAN FEES -0.83% 0.01 11,250 INTERIM INTERES -1.66% 0.01 22,500 MKTING, PUBLIC,GOVT,MEDIA,PRO 0.75% 0.08 146,260 MARKETING - PRE-GRAND OPENIN 0.50% 0.05 97,506 TAXES DURING CONSTRUCTION ( 1.00% 0.10 195,013 BROKERAGE COMMISSIONS 0.80% 0.08 156,010 MISCELLANEOUS, CITY FEES 0.50% 0.01 15,000 LEGAL/CONSULTANT 1.10% 0.11 214,514 TOTAL (0.26) $ (483,559) $ RESERVES: CAPITALIZED INITIAL LOSSES PRO FORMA 0.03 55,373 CONTINGENCY 0.53 1,000,000 TOTAL RESERVES 0.56 $ 1,055,373 $ TOTAL PROJECT COST PER SQUARE FOOT 0.30 $ 571,814 $ WILLDAN FINANCIAL SERVICES - CONFIDENTIAL 3 OperExp&SoftCosts 6/4/2015, 10:20 AM ---PAGE BREAK--- FCEDA RAIL PARK FCEDA Full Rail Park 060115 20 YEAR PROFORMA: INCOME: ACRES 1 2 3 4 5 6 7 8 9 10 11 LOT 1 2.1 0 0 0 18,295 36,590 36,590 36,590 36,590 36,590 36,590 36,590 LOT 2 2.3 0 0 0 0 0 0 0 0 0 0 0 LOT 3 3.2 0 0 0 27,878 55,757 55,757 55,757 55,757 55,757 55,757 55,757 LOT 4 1.7 0 0 0 0 0 0 0 0 0 0 0 LOT 5 1.8 0 0 0 15,682 31,363 31,363 31,363 31,363 31,363 31,363 31,363 LOT 6 1.7 0 14,810 29,621 29,621 29,621 29,621 29,621 29,621 29,621 29,621 29,621 LOT 7 1.6 0 13,939 27,878 27,878 27,878 27,878 27,878 27,878 27,878 27,878 27,878 LOT 8 2.0 0 17,424 34,848 34,848 34,848 34,848 34,848 34,848 34,848 34,848 34,848 LOT 9 0.5 0 0 0 4,356 8,712 17,424 17,424 17,424 17,424 17,424 17,424 LOT 10 2.1 0 18,295 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 LOT 11 1.3 0 11,326 22,651 22,651 22,651 22,651 22,651 22,651 22,651 22,651 22,651 LOT 12 (CHS) 11.4 0 99,317 198,634 198,634 198,634 198,634 198,634 198,634 198,634 198,634 198,634 LOT 13 0.7 0 0 0 6,098 12,197 24,394 24,394 24,394 24,394 24,394 24,394 EXPENSE RECOVERY 0 (5,253) (10,507) (12,676) (14,845) (15,473) (15,473) (15,473) (15,473) (15,473) (15,473) LESS CREDIT LOSS (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) PROPERTY MANAGEMENT @ 5% OF GROSS RE 0 (8,756) (17,511) (21,127) (24,742) (25,788) (25,788) (25,788) (25,788) (25,788) (25,788) % OF OPERATING COSTS TO GROSS INCOME 16.50% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% TOTAL INCOME (10,000) 159,858 329,716 399,856 469,996 490,278 490,278 490,278 490,278 490,278 490,278 OPERATING EXPENSES (1,500) (15,986) (32,972) (39,986) (47,000) (49,028) (49,028) (49,028) (49,028) (49,028) (49,028) MISCELLANEOUS FEES (150) (1,599) (3,297) (3,999) (4,700) (4,903) (4,903) (4,903) (4,903) (4,903) (4,903) 43560 NET OPERATING INCOME (11,650) 142,273 293,447 355,872 418,297 436,347 436,347 436,347 436,347 436,347 436,347 FREE & CLEAR RETURN -2.04% 24.88% 51.32% 62.24% 73.15% 76.31% 76.31% 76.31% 76.31% 76.31% 76.31% 0 0 0 0 0 0 0 0 0 0 0 DEBT SERVICE - 30 YEARS (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) BUILDING INCOME (55,023) 98,901 250,074 312,499 374,924 392,975 392,975 392,975 392,975 392,975 392,975 CAPITAL ITEMS: LEASING COMMISSIONS 0 0 0 0 0 0 0 0 0 0 0 MISC ANNUAL CAPITAL ITEMS (350) (5,595) (11,540) (13,995) (16,450) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (annual reserve percentage increase) 3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% TOTAL CAPITAL ITEMS (350) (5,595) (11,540) (13,995) (16,450) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) PRE TAX OPERATING CASH FLOW (55,373) 93,306 238,534 298,504 358,474 375,815 375,815 375,815 375,815 375,815 375,815 CAPITALIZED INITIAL LOSSES 55,373 0 0 0 0 0 0 0 0 0 0 WATCO FINANCIAL CONTRIBUTION 40,000 40,000 40,000 40,000 40,000 ADJUSTED CASH FLOW 40,000 133,306 278,534 338,504 398,474 375,815 375,815 375,815 375,815 375,815 375,815 SALE VALUE @ STABILIZATION $7,272,455 PRE TAX CASH FLOW $178,186 $40,000 $133,306 $278,534 $338,504 $398,474 $375,815 $375,815 $375,815 $375,815 $375,815 $375,815 WILLDAN FINANCIAL SERVICES - CONFIDENTIAL 4 OperExp&SoftCosts 6/4/2015, 10:20 AM ---PAGE BREAK--- FCEDA RAIL PARK FCEDA Full Rail Park 060115 20 YEAR PROFORMA: INCOME: ACRES LOT 1 2.1 LOT 2 2.3 LOT 3 3.2 LOT 4 1.7 LOT 5 1.8 LOT 6 1.7 LOT 7 1.6 LOT 8 2.0 LOT 9 0.5 LOT 10 2.1 LOT 11 1.3 LOT 12 (CHS) 11.4 LOT 13 0.7 EXPENSE RECOVERY LESS CREDIT LOSS PROPERTY MANAGEMENT @ 5% OF GROSS RE % OF OPERATING COSTS TO GROSS INCOME TOTAL INCOME OPERATING EXPENSES MISCELLANEOUS FEES 43560 NET OPERATING INCOME FREE & CLEAR RETURN DEBT SERVICE - 30 YEARS BUILDING INCOME CAPITAL ITEMS: LEASING COMMISSIONS MISC ANNUAL CAPITAL ITEMS (annual reserve percentage increase) TOTAL CAPITAL ITEMS PRE TAX OPERATING CASH FLOW CAPITALIZED INITIAL LOSSES WATCO FINANCIAL CONTRIBUTION ADJUSTED CASH FLOW SALE VALUE @ STABILIZATION $7,272,455 PRE TAX CASH FLOW $178,186 12 13 14 15 16 17 18 19 20 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 0 0 0 0 0 0 0 0 0 55,757 55,757 55,757 55,757 55,757 55,757 55,757 55,757 55,757 0 0 0 0 0 0 0 0 0 31,363 31,363 31,363 31,363 31,363 31,363 31,363 31,363 31,363 29,621 29,621 29,621 29,621 29,621 29,621 29,621 29,621 29,621 27,878 27,878 27,878 27,878 27,878 27,878 27,878 27,878 27,878 34,848 34,848 34,848 34,848 34,848 34,848 34,848 34,848 34,848 17,424 17,424 17,424 17,424 17,424 17,424 17,424 17,424 17,424 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 36,590 22,651 22,651 22,651 22,651 22,651 22,651 22,651 22,651 22,651 198,634 198,634 198,634 198,634 198,634 198,634 198,634 198,634 198,634 24,394 24,394 24,394 24,394 24,394 24,394 24,394 24,394 24,394 (15,473) (15,473) (15,473) (15,473) (15,473) (15,473) (15,473) (15,473) (15,473) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (25,788) (25,788) (25,788) (25,788) (25,788) (25,788) (25,788) (25,788) (25,788) -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% -11.00% 490,278 490,278 490,278 490,278 490,278 490,278 490,278 490,278 490,278 (49,028) (49,028) (49,028) (49,028) (49,028) (49,028) (49,028) (49,028) (49,028) (4,903) (4,903) (4,903) (4,903) (4,903) (4,903) (4,903) (4,903) (4,903) 436,347 436,347 436,347 436,347 436,347 436,347 436,347 436,347 436,347 76.31% 76.31% 76.31% 76.31% 76.31% 76.31% 76.31% 76.31% 76.31% 0 0 0 0 0 0 0 0 0 (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) (43,373) 392,975 392,975 392,975 392,975 392,975 392,975 392,975 392,975 392,975 0 0 0 0 0 0 0 0 0 (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% -3.50% (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) (17,160) 375,815 375,815 375,815 375,815 375,815 375,815 375,815 375,815 375,815 0 0 0 0 0 0 0 0 0 375,815 375,815 375,815 375,815 375,815 375,815 375,815 375,815 375,815 $375,815 $375,815 $375,815 $375,815 $375,815 $375,815 $375,815 $375,815 $375,815 WILLDAN FINANCIAL SERVICES - CONFIDENTIAL 5 OperExp&SoftCosts 6/4/2015, 10:20 AM