Exhibit 99.1
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COGENT Realty Advisors, LLC
Valuation, Consultation, Due Diligence
Valuation, Consultation, Due Diligence
Appraisal of
The Sterling
1815 JFK Boulevard
Philadelphia, Pennsylvania
1815 JFK Boulevard
Philadelphia, Pennsylvania
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February 22, 2010
Mr. Derek McCandless
Con Cap Equities, Inc.
4582 S. Ulster Street, Suite 1100
Denver, CO 80237
Con Cap Equities, Inc.
4582 S. Ulster Street, Suite 1100
Denver, CO 80237
Re: | Appraisal of The Sterling 1815 JFK Boulevard Philadelphia, Pennsylvania 19103 |
Dear Mr. McCandless:
Cogent Realty Advisors, LLC (“CRA”) has completed an appraisal of the above-referenced property as requested by our November 30, 2009 engagement letter. The purpose of this assignment is to estimate the Market Value of the Leased Fee Interest in the subject property as of December 31, 2009. The property was last inspected by the appraiser on December 15, 2010, and this appraisal was prepared given market conditions prevalent at that time. The report has been prepared for Con Cap Equities, Inc., the property’s ownership entity, for client’s use in asset evaluation and financial reporting purposes.
Situated as noted above, the subject property consists of a 0.891-acre site improved with a mixed-use high-rise development including 535 apartment units comprising 517,490 square feet, 22,874 square feet of street-level retail space and 93,676 square feet of multi-tenant office space. Originally developed in 1961, the subject property contains a total of 634,040 square feet of rentable area on 30 floors. Additional site improvements include a 125-space below-grade parking garage, roof-top swimming pool, on-site property management and fitness center. Located in the City Center District of Philadelphia, the subject property is conveniently located and proximate to public transportation, shopping, restaurants, entertainment venues and the downtown employment district. The development, locally known as The Sterling, is classified as a Class A residential development by local market standards. The property is operating at stabilized occupancy and is in average physical condition. The subject property is more fully described, legally and physically, within the attached report.
Based on the analysis contained in the attached report, the Market Value of the Leased Fee Interest in the subject property, as of December 31, 2009, is:
NINETY-THREE MILLION NINE HUNDRED THOUSAND DOLLARS
($93,900,000)
($93,900,000)
The market value is subject to the extraordinary assumption that no material changes in the physical condition of the property or overall market conditions will occur between the date of inspection and effective date of value.
The attached report, in its entirety, including all assumptions and limiting conditions, which is an integral part of, and inseparable from, this transmittal letter, contains the data, information, analyses and calculations upon which the value conclusion indicated herein are based. The report was prepared in
COGENT Realty Advisors, LLC
Commercial Real Estate Valuation, Consultation, Due Diligence
5307 E. Mockingbird Lane, Suite 1050, Dallas, Texas 75206
Tel: 214.363.3373 Fax: 214.369.4388
Commercial Real Estate Valuation, Consultation, Due Diligence
5307 E. Mockingbird Lane, Suite 1050, Dallas, Texas 75206
Tel: 214.363.3373 Fax: 214.369.4388
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Mr. Derek McCandless Con Cap Equities, Inc. | February 22, 2010 Page 2 |
compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) as set forth by the Appraisal Foundation and in accordance with the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute.
It has been a pleasure to be of service to you. Please do not hesitate to call Steven J. Goldberg at (214) 363-3373 with any questions you may have regarding our assumptions, observations or conclusions.
Respectfully submitted,
COGENT REALTY ADVISORS, LLC
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By: | Steven J. Goldberg, MAI, CCIM | By: | Robert T. Don | |||
Managing Partner | Senior Appraiser |
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page i |
INTRODUCTION | ||||
Title Page | ||||
Letter of Transmittal | ||||
Table of Contents | i | |||
Certificate of Appraisal | ii | |||
Basic Assumptions and Limiting Conditions | iii | |||
Subject Property Photographs | v | |||
Maps | vi | |||
PREMISES OF THE APPRAISAL | ||||
Summary of Salient Facts and Conclusions | 1 | |||
Premises of the Appraisal | 3 | |||
Sales History | 3 | |||
Purpose and Scope of the Appraisal | 3 | |||
Definition of Value | 4 | |||
Property Rights Appraised | 4 | |||
Intended Use and User of the Appraisal and Reporting | 4 | |||
Exposure Period | 4 | |||
PRESENTATION OF DATA | ||||
Regional and Area Analysis | 6 | |||
Neighborhood Analysis | 14 | |||
Site Analysis | 22 | |||
Improvement Analysis | 24 | |||
Zoning Analysis | 28 | |||
Real Estate Assessment and Taxes | 29 | |||
MARKET ANALYSIS | ||||
Apartment Market Analysis | 31 | |||
Commercial Market Analysis | 39 | |||
Apartment Market Rent Analysis | 43 | |||
Commercial Market Rent Analysis | 55 | |||
ANALYSIS OF DATA AND CONCLUSIONS | ||||
Highest and Best Use | 61 | |||
Valuation Process | 63 | |||
Income Capitalization Approach | 65 | |||
Sales Comparison Approach | 88 | |||
Reconciliation and Final Value Conclusion | 96 | |||
ADDENDA | ||||
Additional Subject Property Photographs | ||||
Improved Sales Photographs | ||||
Argus Supporting Information | ||||
Appraiser Qualifications |
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page ii |
CERTIFICATE OF APPRAISAL
We, Steven J. Goldberg, MAI, CCIM and Robert T. Don, certify that to the best of our knowledge and belief:
The statements of fact contained in this appraisal are true and correct.
The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and my personal, unbiased professional analyses, opinions, and conclusions.
We have no present or prospective interest in the property that is the subject property of this appraisal, and have no personal interest or bias with respect to the parties involved.
Our compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event
Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) as promulgated by the Appraisal Standards Board of the Appraisal Foundation, the Code of Professional Ethics and the Standards of Professional Appraisal Practice of the Appraisal Institute.
No one other than the undersigned assisted in the preparation of this appraisal.
Robert T. Don made a personal inspection of the property that is the subject of this appraisal on December 15, 2009. Steven Goldberg, MAI did not inspect the subject property.
This appraisal was not prepared in conjunction with a request for a specific value or a value within a given range or predicated upon loan approval.
We have the knowledge and experience necessary to perform this appraisal assignment and have extensive experience in the appraisal of similar properties.
As of the date of this appraisal, Steven J. Goldberg, MAI has completed the requirements under the continuing education program of the Appraisal Institute.
The use of this report is subject to the requirements of the Appraisal Institute relating to review its duly authorized representatives.
Steven J. Goldberg, MAI, CCIM has received a Temporary Authority to Practice Permit from the Commonwealth of Pennsylvania for the purpose of appraising the subject property (Temporary License #002397).
Robert T. Don has received a Temporary Authority to Practice Permit from the Commonwealth of Pennsylvania for the purpose of appraising the subject property (Temporary License #002398).
COGENT REALTY ADVISORS, LLC
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By: | Steven J. Goldberg, MAI, CCIM | By: | Robert T. Don | |||
Managing Partner | Senior Appraiser |
COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page iii |
BASIC ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal report is subject to the following assumptions and limiting conditions:
1. | No responsibility is assumed for the legal description or for matters including legal or title considerations. Title to the property is assumed to be good and marketable unless otherwise stated. | |
2. | The property is appraised free and clear of any or all liens or encumbrances unless otherwise stated. | |
3. | Responsible ownership and competent property management are assumed. | |
4. | The information furnished by others is believed to be reliable. However, no warranty is given for its accuracy. | |
5. | All engineering is assumed to be correct. The plot plans and illustrative material in this report are included only to assist the reader in visualizing the property. | |
6. | It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for such conditions or for arranging for engineering studies that may be required to discover them. | |
7. | It is assumed that there is full compliance with all applicable federal, state, and local environmental regulations and laws unless noncompliance is stated, defined, and considered in the appraisal report. | |
8. | It is assumed that all applicable zoning and use regulations and restrictions have been complied with, unless nonconformity has been stated, defined, and considered in the appraisal report. | |
9. | It is assumed that all required licenses, certificates of occupancy, consents, or other legislative or administrative authority from any local, state, or national government or private entity or organization have been or can be obtained or renewed for any use on which the value estimate contained in this report is based. | |
10. | It is assumed that the utilization of the land and improvements is within the boundaries or property lines of the property described and that there is no encroachment or trespass unless noted in the report. | |
11. | The distribution, if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate allocations for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used. | |
12. | Unless otherwise stated, possession of this report, or a copy thereof, does not carry with it the right of publication. | |
13. | The appraiser, by reason of this appraisal, is not required to give further consultation, testimony, or be in attendance in court with reference to the property in question unless arrangements have been previously made. | |
14. | Unless otherwise stated, neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraiser, or the firm with which the appraiser is connected) shall be disseminated to the public through advertising, public relations, news, sales, or other media without prior written consent and approval of the appraisers. |
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15. | Unless otherwise stated in this report, the existence of hazardous substances, including without limitation asbestos, polychlorinated biphenyls, petroleum leakage, or agricultural chemicals, which may or may not be present on the property, or other environmental conditions, were not called to the attention of nor did the appraiser become aware of such during the appraiser’s inspection. The appraiser has no knowledge of the existence of such materials on or in the property unless otherwise stated. The appraiser, however, is not qualified to test such substances or conditions. If the presence of such substances, such as asbestos, urea formaldehyde foam insulation, or other hazardous substances or environmental conditions, may affect the value of the property, the value is predicated on the assumption that there is no such condition on or in the property or in such proximity thereto that it would cause a loss in value. No responsibility is assumed for any such conditions, or for any expertise or engineering knowledge required to discover them. The client is urged to retain an expert in this field, if desired. | |
16. | The Americans with Disabilities Act (“ADA”) became effective January 26, 1992. The appraiser has not made a specific compliance survey and analysis of this property to determine whether or not it is in conformity with the various detailed requirements of the ADA. It is possible that a compliance survey of the property, together with a detailed analysis of the requirements of the ADA, could reveal that the property is not in compliance with one or more of the requirements of the Act. If so, this fact could have a negative effect upon the value of the property. Since the appraiser has no direct evidence relating to this issue, he did not consider possible non-compliance with the requirements of the ADA in estimating the value of the property. | |
17. | Former personal property items such as kitchen and bathroom appliances are now either permanently affixed to the real estate or are implicitly part of the real estate in that tenants expect the use of such items in exchange for rent and never gain any of the rights of ownership. Furthermore, the intention of the owners is not to remove the articles which are required under the implied or express Warranty of Habitability. The accounting for the short-lived nature of such items is reflected in a reserves for replacement expense category. |
EXTRAORDINARY ASSUMPTIONS
1. | The analysis assumes that no material changes in the subject’s physical condition or overall market conditions will occur between the date of inspection and effective date of value. |
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SUBJECT PROPERTY PHOTOGRAPHS
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page vi |
REGIONAL MAP
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NEIGHBORHOOD MAP
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COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 1 |
SUMMARY OF SALIENT FACTS AND CONCLUSIONS | ||
Date of Value | December 31, 2009 | |
Date of Inspection | December 15, 2009 | |
Property Name | The Sterling | |
Property Address | 1815 JFK Boulevard Philadelphia, Pennsylvania 19103 | |
Property Location | City Center District of Philadelphia, just south of I-676, north of Market Street, west of the Delaware River, and east of the Schuylkill River in the central sector of the City of Philadelphia. The subject neighborhood is a mature urbanized area. The area is developed with high-intensity uses including high-rise commercial and residential buildings, government services, museums, shopping centers and entertainment venues. | |
Tax Identification | 881035000 (Philadelphia Board of Revision of Taxes) | |
Purpose and Use | Estimate the Market Value of the Leased Fee Interest in the subject property as of December 31, 2009, free and clear of financing. The report has been prepared for Con Cap Equities, Inc., the property’s ownership entity, for client’s use in asset evaluation and financial reporting purposes. | |
Site Size | Rectangular shaped site that contains a total of 0.891 acres (38,808 square feet). | |
Zoning | “C-5” (Commercial District) — City of Philadelphia | |
Improvements | A mixed-use, high-rise development including 535 apartment units comprising 517,490 square feet, 22,874 square feet of street-level retail space and 93,676 square feet of multi-tenant office space. The subject was developed in 1961 and contains 634,040 square feet of rentable area on 30 floors. Additional site improvements include a 125-space below-grade parking garage, roof-top swimming pool, on-site property management and fitness center. The property is operating at stabilized occupancy and is in average physical condition. | |
2009 Assessed Value | $30,528,300 (Market Value Assessment) $9,769,056 (Assessed Value) | |
Highest and Best Use | ||
As If Vacant | Eventual development with a high-intensity mixed-use. | |
As Improved | Continued use of the existing improvements. |
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 2 |
VALUATION INDICATIONS
Residential Component | ||||
Income Capitalization | $ | 83,600,000 | ||
Discounted Cash Flow | $ | 83,600,000 | ||
Projection period | 10 Years | |||
Terminal Cap Rate | 7.5 | % | ||
Discount Rate | 9.0 | % | ||
Value per Unit | $ | 156,262 | ||
Value per Sq Ft | $ | 161.59 | ||
Direct Capitalization | $ | 82,100,000 | ||
Stabilized NOI | $ | 5,747,248 | ||
Cap Rate | 7.0 | % | ||
Value per Unit | $ | 153,458 | ||
Value per Sq Ft | $ | 158.70 | ||
Sales Comparison | $ | 82,900,000 | ||
Value per Unit | $ | 155,000 | ||
Value per Sq Ft | $ | 160.24 | ||
Cost Approach | N/A | |||
Commercial Component | ||||
Income Capitalization | $ | 10,300,000 | ||
Discounted Cash Flow | $ | 10,300,000 | ||
Projection period | 10 Years | |||
Terminal Cap Rate | 9.0 | % | ||
Discount Rate | 9.5 | % | ||
Value per Sq Ft | $ | 89.14 | ||
Direct Capitalization | $ | 10,100,000 | ||
Stabilized NOI | $ | 1,064,853 | ||
Cap Rate | 8.5 | % | ||
Value per Sq Ft | $ | 87.41 | ||
Sales Comparison | $ | 11,000,000 | ||
Value per Sq Ft | $ | 95.00 | ||
Cost Approach | N/A |
APPRAISED VALUE — (OVERALL PROPERTY — RESIDENTIAL AND COMMERCIAL)
Income Capitalization | $ | 93,900,000 | ||
Sales Comparison | $ | 93,900,000 | ||
Cost Approach | N/A |
COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 3 |
PREMISES OF THE APPRAISAL | ||
Identification | The subject property consists of the land and improvements located at 1815 JFK Boulevard within the City Center District of the city of Philadelphia, Pennsylvania. The City of Philadelphia Board of Revision Taxes identifies the property by Tax Account Number 881035000. The property consists of a 0.891-acre site improved with mixed-use high-rise building comprised of residential, retail and office uses. It is locally known as The Sterling. | |
Sales History of the Subject Property | According to public tax records, ownership of the subject property is vested in CCIP Sterling LP (Carlton House Associates). The current owner acquired title to the property through a deed transfer recorded on December 13, 1995. We are not aware of any arms length transfers of ownership within the three-year period prior to the effective date of value. It is our understanding that the subject property is not being listed for sale and we are not aware of any contracts of sale pending as of the date this report was prepared. | |
Purpose and Scope of the Appraisal | The purpose of the appraisal is to estimate the market value of the subject property as of the date of value. It is the intent of the appraisers that the analysis, opinions and conclusions of this report be considered an unbiased, objective investigation performed by a disinterested third party with complete objectivity as to the outcome of the analysis. | |
According to the Appraisal Institute’s Code of Professional Ethics and Uniform Standards of Professional Appraisal Practice, the scope of the appraisal is cited as“the extent of the process of collecting, confirming, and reporting data”included in an appraisal report. All appropriate data deemed pertinent to the solution of the appraisal problem has been collected and confirmed. In our appraisal of the subject property, we have: | ||
1. Inspected the subject property and its environs. | ||
2. Reviewed demographic and other socioeconomic trends pertaining to the city and region. | ||
3. Examined regional apartment, office and retail market conditions, with special emphasis on the subject property’s submarket. | ||
4. Investigated lease and sale transactions involving comparable properties in the influencing market. | ||
5. Reviewed the existing rent roll and discussed the leasing status with the building manager and leasing agent. In addition, we have reviewed the subject property’s recent operating history and those of competing properties. | ||
6. Utilized appropriate appraisal methodology to derive estimates of value. | ||
7. Reconciled the estimates of value into a single value conclusion. |
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 4 |
Definition of Market Value | Market Value is defined by the Appraisal Institute, The Dictionary of Real Estate Appraisal, Fourth Edition, Chicago, Illinois, Appraisal Institute, 2002, as: | |
The most probable price which a specified interest in real property is likely to bring under all of the following conditions: | ||
1. Consummation of a sale occurs as of a specified date. | ||
2. An open and competitive market exists for the property interest appraised. | ||
3. The buyer and seller are each acting prudently and knowledgably. | ||
4. The price is not affected by undue stimulus. | ||
5. The buyer and seller are typically motivated. | ||
6. Both parties are acting in what they consider their best interest. | ||
7. Marketing efforts were adequate and a reasonable time was allowed for exposure in the open market. | ||
8. Payment was made in cash, in U.S. dollars 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. | ||
Property Rights Appraised | Leased Fee Estate. A Leased Fee Estate is defined inThe Dictionary of Real Estate Appraisal, Fourth Edition, Chicago, Illinois, Appraisal Institute, 2002, as: | |
An ownership interest held by a landlord with the right of use and occupancy conveyed by lease to others; the rights of the lessor (the leased fee owner) and the lessee (leaseholder) are specified by contract terms contained within the lease. | ||
Intended Use and Intended User | The intended user of this report is the property owner. It is understood that this appraisal will be utilized by the intended user as an aid in asset management and evaluation and financial reporting. All others reading or relying on this appraisal report are considered unintended users of this appraisal. The appraisal cannot be used for any other reason than that stated above. Should anyone other than the client read or rely on this report, no fiduciary obligation is owed by the appraisers to that party. The appraisers are not responsible for unauthorized use of this report. | |
This appraisal has been prepared in compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) as promulgated by the Appraisal Standards Board of the Appraisal Foundation as well as the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. The presentation of data and results of our analysis are presented in a Self-contained Report format as set forth under Standards Rule 2-2 of the USPAP. | ||
Exposure Period | According to the previously stated definition of Market Value, the property must be allowed a reasonable time to be exposed in the open market to |
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 5 |
achieve the appraised value. Exposure is defined by the Appraisal Institute, The Dictionary of Real Estate Appraisal, as: | ||
• The time a property remains on the market. | ||
• The estimated length of time 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 estimate based upon an analysis of past events assuming a competitive and open market. Exposure time is always presumed to occur prior to the effective date of the appraisal. The overall concept of reasonable exposure encompasses not only adequate, sufficient and reasonable time but also adequate, sufficient and reasonable effort. Exposure time is different for various types of real estate and value ranges and under various market conditions. | ||
Review of transfer records suggests that there is an active investor market for good quality apartment properties; however marketing times have increased over the past year. Conventional sources of capital are limited in the current economic environment. Mortgage underwriting has become more conservative over the past year and a greater level of equity is now required to obtain financing. This factor has caused overall capitalization rates and investment yields to increase over the recent past and has impacted sales activity for most types of commercial real estate. | ||
We believe that if the subject property were exposed to the market for a reasonable period of time prior to the effective date of this appraisal, which we consider to be a period of up to 12 months, the subject property would transfer at an appropriate price, that is to say, the appraised value. Support for this exposure period is provided by theKorpacz Real Estate Investor Survey Third Quarter 2009, which indicates that marketing times for apartment properties in the national market range from 3 to 18 months. The average marketing time equates to 9.11 months, up from 6.00 months reported one year ago. This marketing period is supported by data in the local market. Office properties in the Philadelphia market exhibit average marketing times range from 3 to 9 months. The average marketing time equates to 6.60 months, down from 6.92 months reported one year ago. This marketing period is also supported by data in the local market. | ||
We acknowledge that in appraising the property to sell after the aforementioned exposure period, we must place most emphasis on the buyer’s expectations and yield requirements. The value conclusion rendered for the property through implementation of the Income Capitalization Approach has been accorded most significance as this technique most closely emulates buyer’s expectations and yield requirements. The market value estimate concluded herein assumes an exposure and marketing period of up to 12 months has occurred. |
COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Page 6 |
REGIONAL AND AREA ANALYSIS | ||
Introduction | Real estate values reflect the influence of four primary forces that motivate human activity; social trends, economic conditions, governmental policies and environmental factors. The purpose of the city data synopsis is to describe and analyze the area within which the interactions of the four major forces influence properties similar to the subject. This section will further analyze past trends for insight into possible future trends affecting the value of real estate. | |
MSA | The subject property is located in the City of Philadelphia. The Philadelphia Primary Metropolitan Statistical Area (PMSA) is comprised of nine counties: Bucks, Chester, Delaware, Montgomery and Philadelphia Counties in southeast Pennsylvania and Burlington, Camden, Gloucester and Salem Counties in southern New Jersey. The region borders both sides of the Delaware River in Pennsylvania and New Jersey and comprises 3,776 square miles. The metropolitan area is part of the Delaware Valley, which extends north to Trenton, New Jersey and south to Wilmington, Delaware. The region contains the nation’s sixth largest city, Philadelphia, with a population of just over 1.4 million. It is centrally located within the nation’s northeast corridor — 100 miles south of New York City and 133 miles north of Washington, D.C. |
REGIONAL CONTEXT OF PHILADELPHIA, PA
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Transportation | Philadelphia’s transportation network is one of the more comprehensive in the nation and includes modes of transportation by land, air and water. More than 2,500 miles of federal and state highways run through the metropolitan area, making it accessible from any direction. The most significant addition to the freeway system is the 21.5-mile Mid-County Expressway, commonly known as the “Blue Route,” which was |
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completed in 1992 after 25 years of construction. The expressway serves as a beltway through Philadelphia’s western suburbs and provides travelers with a connection between Interstate 95 at Chester, southwest of the City and Interstate 76, also known as the Pennsylvania Turnpike, at Plymouth Meeting northwest of the City. Major interstates that run through and around downtown Philadelphia include I-95, I-76 and I-676. | ||
The region’s rail and public transit infrastructure is comprised of several different systems. Philadelphia’s Amtrak station is the second busiest and handles more than 3.5 million passengers annually, with hourly trains to New York and Washington, D.C. The City Transit Division of the Southeastern Pennsylvania Transportation Authority (SEPTA) serves the City of Philadelphia with a system of 84 subway, light rail, trackless trolley and bus routes providing nearly 554,000 passenger trips per day. The Regional Rail Division of SEPTA serves all five suburban Philadelphia counties with seven commuter rail lines providing nearly 79,000 passenger trips per day. SEPTA’s Suburban Operations Division serves the western and northern suburbs with a system of 41 inter-urban trolley, light rail and bus routes providing nearly 44,000 passenger trips per day. | ||
The Port Authority Transit Corporation (PATCO) Hi-Speed line serves commuters in the New Jersey suburbs of Philadelphia. PATCO trains run 24 hours a day from nine stations in New Jersey to four stations in Philadelphia and handles over 40,000 passengers per day. | ||
Philadelphia International Airport (PHL) is the area’s principal gateway. The airport handles approximately 500,000 aircraft departures and landings and more than 20 million passengers per year. Approximately 26 scheduled passenger carriers and non-scheduled charters serve over 100 domestic and international destinations daily. In addition, eight all-cargo airlines handle nearly 590,000 tons of cargo annually. The airport currently consists of five terminals and four runways but recently underwent a major capital improvement program to expand its facilities. The expansion included the construction of a new 5,000 foot, $221 million commuter runway, a $75 million 190,000 square-foot regional terminal accommodating commuter and turbo-prop aircraft, and a new $325 million, 785,000 square-foot international terminal with 12 wide-body international gates that opened approximately three years ago. | ||
The Port of Philadelphia and Camden, located at the head of the Delaware Bay, is one of the nation’s major deepwater seaports and is the second busiest port on the North Atlantic coast for total volume. The port handles more than one-quarter of the entire North Atlantic District’s annual tonnage and is the fourth largest in the U.S. for handling imported goods. Over 60 million metric tons of cargo moves through the port annually and over 3,000 ships load and offload at the port each year. The port is strategically located at the center of the Northeast Corridor, the nation’s largest and richest marketplace, and is directly accessible by rail and truck to more major cities than any other port in the nation. |
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Regional Economy | The Metropolitan Philadelphia area’s central location, diverse industry base, proven corporate commitment and talented labor pool has made it a leading economic center for many years. In fact, professional and business services, and wholesale trade sectors have higher employment concentrations in Philadelphia than in the national economy. Philadelphia boasts a large, highly skilled and educated workforce that comprises one of the most wide-ranging economies in the nation. Today, the Philadelphia area has a strong presence in the field of healthcare, pharmaceuticals, and biotechnology, as well as oil and chemicals, telecommunications, computer technology, food manufacturing and finance. The presence of leading educational institutions in the area has also made Philadelphia a top communications and technology center. The education and healthcare sector, which is largely recession proof, is the leading employment sector in both size and growth in Greater Philadelphia. | |
The presence of numerous surrounding colleges and universities has also aided the city’s development into one of the top life-sciences centers in the nation along with Boston and San Francisco. The fastest growing sectors of the Philadelphia economy are the biomedical and pharmaceutical industries. Furthermore, biotechnology attracts a large share of venture capital investments into the City of Philadelphia. Capitalizing on Greater Philadelphia’s history as both a chemical and research center, 14 major pharmaceutical firms and nearly 100 biotech firms are located in the area, making it the second largest pharmaceutical center in the nation. | ||
Key economic considerations that drive the Region’s economy include the following: 4th largest metro region in the US and 2nd largest in the East Coast; 5th largest in personal income; 4th largest total employment; and 4th largest media market; Offers one of the lowest rents among northeastern MSA’s with an average Class A office rent of $26 PSF; Life Sciences is the #1 economic engine driving the Greater Philadelphia region with more than 400 locally based life sciences companies. There were over 3,400 life science degrees awarded in Greater Philadelphia in 2005/06. The City of Philadelphia serves as the headquarters for such Fortune 500 firms as Comcast Corp., Cigna Corp., Sunoco Inc., Aramark Corp., Rohm and Haas and Jones Apparel Group. The area’s industrial and manufacturing base is diversified with more than 90% of all industries as defined by the SIC of the U.S. Labor Department. Manufacturing specialties include chemicals, printing, publishing, medical, pharmaceutical, and transportation equipment. Among the region’s largest manufacturing firms are: Boeing Helicopter, Campbell Soup, CertainTeed, DuPont, Sun Company, Rohm and Haas, GlaxoSmithKline, and Unisys. | ||
The region is home to one of the highest concentrations of institutions of higher learning in the U.S., with over 90 colleges and universities and 290,000 students. Even in this recessionary environment, this sector continues to grow as it is less correlated to the general economy. |
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The cost of living in the Greater Philadelphia region is 11% less than Washington D.C., 9% less than Boston and 73% lower than New York City according to the Center City Development Corporation. | ||
Greater Philadelphia is home to six medical schools. One in five U.S. physicians has received training in a Greater Philadelphia medical school or hospital. Scheie Eye Institute, Children’s Hospital of Philadelphia, The Hospital of the University of Pennsylvania, and Thomas Jefferson University are consistently ranked amongst the nation’s top hospitals by the U.S. News & World Report. The recent introduction of the gaming industry to Philadelphia has attracted an influx of potential capital. | ||
Finance and manufacturing are tied for the region’s fifth largest sector, with 7.9% of the area’s jobs. While the financial sector is struggling nationally, Philadelphia is less dependent on financial firms than other large financial centers such as New York, Boston and Charlotte. | ||
The area’s industrial and manufacturing base continues to weaken. However, the possibility exists for stabilizing the industrial base of the City which is the many ports along the Delaware River in Pennsylvania, New Jersey, and Delaware. In total, the Ports create the fourth largest seaport in the U.S. for imported goods. They also comprise what is the busiest freshwater port in the world, handling the largest volume of international tonnage on the East Coast – in excess of 70 million metric tons of waterborne cargo. The Ports primarily concentrate on refined oil products, chemicals foodstuffs and steel, and form one of the largest concentrations of port-related jobs in the world. Nonetheless, according to the Philadelphia Federal Reserve’s section of the Beige Book, which was released December 3, 2008, local manufacturers are reporting a drop of shipments and new orders, especially those that make construction-related materials. | ||
Population | Population trends affect employment, retail spending, housing, bank deposits, and many other essential demand parameters analyzed in determining real estate productivity. Population growth, stability, or decline is a strong indicator of real estate viability within an area. The following population and employment data represents historic trends of the counties that comprise the Philadelphia MSA and City of Philadelphia. |
POPULATION
Philadelphia MSA | City of Philadelphia | |||||||||||||||
Year | Population | % Change | Population | % Change | ||||||||||||
1999 | 5,665,200 | 1,520,100 | ||||||||||||||
2004 | 5,777,400 | 2.0 | % | 1,468,800 | -3.4 | % | ||||||||||
2005 | 5,972,800 | 0.3 | % | 1,460,300 | -0.6 | % | ||||||||||
2006 | 5,810,800 | 0.3 | % | 1,453,200 | -0.5 | % | ||||||||||
2007 | 5,828,000 | 0.3 | % | 1,449,600 | -0.2 | % | ||||||||||
2008 | 5,825,600 | 0.0 | % | 1,432,200 | -1.2 | % | ||||||||||
2009 | 5,824,900 | 0.0 | % | 1,416,800 | -1.1 | % | ||||||||||
2014 Projection | 5,830,500 | 1,354,700 | ||||||||||||||
2019 Projection | 5,846,400 | 1,307,000 |
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The population of the City of Philadelphia decreased at a compounded annual rate of — 0.72% from 2004 to 2009. For the same time period, the Philadelphia MSA grew at a compounded annual rate of approximately 0.16%. Over the last ten years the City of Philadelphia’s average annual compound change was -0.70%, compared to 0.28% for the Philadelphia MSA. | ||
Looking ahead, while the City of Philadelphia is declining, the Philadelphia MSA is anticipated to experience continued growth. For the period 2009 to 2019, the population of the City of Philadelphia is expected to decrease by an average annual compound rate of -0.80%, while the Philadelphia MSA is expected to increase by an average annual compound rate 0.04%, respectively. For the next five years, the population of the City of Philadelphia should grow slower than the ten year average. | ||
There are many communities in Philadelphia and the region where declining population has not resulted in declining property values. In fact, in some cases the values have risen at a greater rate than areas where population had been increasing. Areas where the gentrification process has been most active have shown rising property values even in light of declining population. | ||
Employment | From 2004 to 2009, the City of Philadelphia’s employment declined at an average annual compound rate of -1.06% compared to the annual compound growth rate of 0.61% for the Philadelphia MSA. These figures indicate that the City of Philadelphia lagged the Philadelphia MSA in employment growth over the last five years. Looking back ten years, the City of Philadelphia’s employment fell at an average annual compound rate of — 0.76%, compared to the Philadelphia MSA’s growth rate of 0.70%. | |
Pursuant to NPA Data, a national source for economic data, over the next five and ten years the City of Philadelphia employment growth will likely continue to lag the Philadelphia MSA growth rate. From 2009 to 2014, the City of Philadelphia should decrease by a — 1.18% average annual growth rate, while the long term projection, 2009 to 2019, is for a — 1.14% decrease. For the same periods, employment in the Philadelphia MSA is expected to grow at average annual compound rates of 0.54% and 0.45%, respectively. Employment gains are a strong indicator of economic health and generally correlate with real estate demand. Historically, the City of Philadelphia has lagged the Philadelphia MSA’s growth rate, suggesting that the City of Philadelphia’s relative position is the same as is has been in the past. |
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HISTORICAL EMPLOYMENT TRENDS
Philadelphia MSA | City of Philadelphia | |||||||||||||||
Year | Employment | % Change | Employment | % Change | ||||||||||||
1999 | 3,205,300 | 769,600 | ||||||||||||||
2004 | 3,334,600 | 4.0 | % | 752,500 | -2.5 | % | ||||||||||
2005 | 3,396,000 | 1.8 | % | 758,900 | 0.8 | % | ||||||||||
2006 | 3,451,100 | 1.6 | % | 763,400 | 0.6 | % | ||||||||||
2007 | 3,467,000 | 0.5 | % | 750,500 | -1.7 | % | ||||||||||
2008 | 3,447,500 | -0.6 | % | 730,000 | -2.7 | % | ||||||||||
2009 | 3,436,800 | -0.3 | % | 713,300 | -2.3 | % | ||||||||||
2014 Projection | 3,530,100 | 672,300 | ||||||||||||||
2019 Projection | 3,594,300 | 636,300 |
The following table depicts current employment of the Philadelphia area by sector, including projection for the year 2014. |
EMPLOYMENT BY SECTOR — PHILADELPHIA MSA
Sector | 2009 | Proj. 2014 | % Change | |||||||||
Construction | 166,900 | 174,200 | 0.9 | % | ||||||||
FIRE | 360,200 | 376,300 | 0.9 | % | ||||||||
Government | 373,500 | 384,300 | 0.4 | % | ||||||||
Manufacturing | 222,500 | 201,000 | -2.0 | % | ||||||||
Mining and Other | 6,900 | 7,000 | 0.2 | % | ||||||||
Retail Trade | 369,800 | 379,600 | 0.5 | % | ||||||||
Services | 1,613,300 | 1,673,800 | 0.7 | % | ||||||||
Transportation Information, Utilities | 176,800 | 177,400 | 0.1 | % | ||||||||
Wholesale Trade | 147,100 | 156,600 | 1.3 | % | ||||||||
Total Nonfarm | 3,437,000 | 3,530,200 | 0.5 | % |
In 2009, the largest employment sectors in the Philadelphia MSA were: Services (47%), followed by Government (11%), Retail Trade (11%) and FIRE (11%). Over the past five years, employment within the City of Philadelphia has declined across the board. For the Philadelphia MSA, the largest meaningful gains in employment over the past five years occurred within the FIRE and Services sectors with annual average compound growth rates of 1.59% and 1.16%, respectively. Five year projections for the Philadelphia MSA show has Wholesale Trade related employment leading all other sectors with FIRE second. | ||
The following table is a summary of the largest employers in the Philadelphia area. |
TOP TEN AREA EMPLOYERS
Name | Employees | |||
University of Pennsylvania | 22,265 | |||
Jefferson Health Systems | 12,529 | |||
University of Pennsylvania Health Services | 10,625 | |||
Aramark Corporation | 9,532 | |||
Independence Blue Cross | 9,500 | |||
Comcast | 9,301 | |||
Children’s Hospital of Philadelphia | 9,044 | |||
Thomas Jefferson University Hospitals | 8,192 | |||
Temple University | 7,804 | |||
Temple University Health Systems | 7,500 |
Unemployment | The job losses are piling up in the area, but not as fast as in the rest of the country. U.S. employers cut 4,022,000 jobs since January 2009, putting the current national unemployment rate at 9.7%. During the same time frame the Philadelphia region reported a total job loss of 72,232 with a |
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current unemployment rate of 8.7%. The state of Pennsylvania has a current unemployment rate of 8.9%. The following table is a summary of the unemployment rate trend for the Philadelphia MSA compared to the US and State of Pennsylvania. |
UNEMPLOYMENT TRENDS
City of Philadelphia | Philadelphia MSA | State of Pennsylvania | United States | |||||||||||||
YE 2004 | 7.30 | % | 5.10 | % | 5.30 | % | 5.40 | % | ||||||||
YE 2005 | 6.70 | % | 4.80 | % | 4.70 | % | 4.90 | % | ||||||||
YE 2006 | 6.20 | % | 4.50 | % | 4.30 | % | 4.40 | % | ||||||||
YE 2007 | 6.00 | % | 4.30 | % | 4.60 | % | 5.00 | % | ||||||||
YE 2008 | 7.20 | % | 5.40 | % | 6.40 | % | 7.40 | % | ||||||||
YE 2009 | 10.60 | % | 8.70 | % | 8.90 | % | 10.00 | % |
Income | Personal income is a significant factor in determining the real estate demand in a given market. From 2004 to 2009, the City of Philadelphia’s income grew at an average annual compound rate of 0.99%, compared to the Philadelphia MSA’s average annual compound growth rate of 1.43%. The two market areas displayed a similar pattern in per capita income growth over the last ten years. The City of Philadelphia’s average annual compound growth rate was 1.55% as compared to 1.74% for the Philadelphia MSA. Projections for the next five and ten year periods reflect growth rates for the City of Philadelphia that are less than the anticipated gains for the Philadelphia MSA. For the two time frames, 2009 to 2014 and 2009 to 2019, the City of Philadelphia is anticipated to experience 2.31% and 1.76% average annual growth rates, respectively, compared to the projected growth rates for the Philadelphia MSA of 2.80% and 2.21%. |
INCOME PER CAPITA TRENDS
Philadelphia MSA | City of Philadelphia | |||||||||||||||
Year | $ Per Capita | % Change | $ Per Capita | % Change | ||||||||||||
1999 | $ | 32,574 | $ | 24,451 | ||||||||||||
2004 | $ | 36,049 | 10.7 | % | $ | 27,162 | 11.1 | % | ||||||||
2005 | $ | 36,728 | 1.9 | % | $ | 27,693 | 2.0 | % | ||||||||
2006 | $ | 37,813 | 3.0 | % | $ | 28,493 | 2.9 | % | ||||||||
2007 | $ | 38,792 | 2.6 | % | $ | 28,935 | 1.6 | % | ||||||||
2008 | $ | 38,929 | 0.4 | % | $ | 28,856 | -0.3 | % | ||||||||
2009 | $ | 38,706 | -0.6 | % | $ | 28,528 | -1.1 | % | ||||||||
2014 Projection | $ | 44,429 | $ | 31,971 | ||||||||||||
2019 Projection | $ | 48,140 | $ | 33,968 |
Cultural Influences | Metro Philadelphia is also well noted for the depth and quality of its culture and entertainment. The city is the birthplace of American democracy and home to two of the country’s greatest symbols of freedom: Independence Hall and the Liberty Bell. These two tourist attractions are part of the Independence National Historical Park in “America’s Most Historic Square Mile.” Independence National Historic Park also includes the National Constitution Center and Gateway Visitors Center. The fine arts are also an integral part of Greater Philadelphia’s culture. The Philadelphia Orchestra, Pennsylvania Ballet, Philadelphia Museum of Art, Barnes Foundation, and Philadelphia Opera Company are among the institutions that bring world-class art and entertainment to the region. There are seven major performing arts venues along the Avenue of the Arts. |
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Philadelphia is one of the few American metropolitan areas with professional teams in the four major professional sports venues. It is home to the Eagles, 76ers, Phillies, and Flyers. In addition, the Dad Vail Regatta, the Penn Relays, and the Army-Navy Game are held in the City. Philadelphia is consistently rated one of the most livable cities in the United States compared to other major cities given its combination and accessibility to multiple sports venues and low cost of living compared to other major cities. Also, it was ranked number one best walking cities in the US. Bicycling Magazine ranked the city second best cycling cities in the US. | ||
Conclusion | Overall, the economic outlook for the Philadelphia Region is positive. While the city overall scores negative on population and job growth, the surrounding areas of the different assets which are part of this analysis are desirable vibrant areas, as will be discussed in greater detail later in this report. Moreover, total population and job growth for the region is projected to increase slightly. The region offers a safe and comfortable lifestyle while providing some of the best cultural, historical and entertainment opportunities on the East Coast. Furthermore, Philadelphians enjoy all of the amenities of a world-class city at a fraction of the cost of living of other major East Coast cities. | |
Framed within the limitations imposed by the current global recessionary cycle and the liquidity constraints facing commercial real estate, the expected growth of the region over the long run should provide an economic base that supports demand for real estate in the City of Philadelphia. Although population and employment statistics for the City overall are negative, the observed trends and development activity in the immediate area of the subject, as will be discussed in the following section, are positive. Overall these conditions should stimulate increases in general property values over the long run. |
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NEIGHBORHOOD ANALYSIS | ||
TheAppraisal of Real Estatedefines a neighborhood as“a group of complimentary land uses”.A neighborhood should be distinguished from a district, which is defined as“a type of neighborhood that is characterized by homogenous land use”.A neighborhood will contain land uses complimentary to one another. For example, predominantly residential neighborhoods typically contain some commercial properties that provide services for local residents. The boundaries of a neighborhood can be physical such as a lake, stream or major highway or they may be less easily discernible such as changes in prevailing land use or occupant characteristics. | ||
Location | The subject neighborhood is situated within the City Center district of Philadelphia. Center City has 39.7 million square feet of office space housing more than 50% of CBD employees, making the office market the largest employment sector downtown. Served by a multi-modal regional transit system and accessible from two interstate highways, downtown employers enjoy easy access to a highly-skilled regional workforce. | |
The Center City district is bounded by South Street to the south, the Delaware River to the east, the Schuylkill River to the west and either Vine Street or Spring Garden Street to the north. The Center City district, which has special powers of taxation, uses a complicated, irregularly shaped boundary that includes much of this area but also extends beyond it. | ||
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Land uses | Center City is a dynamic “24-hour” market, one of only a few in the United States. Comprising retail, office, residential and many other forms of institutional and commercial development, Center City has a diverse and balanced economic base containing multiple levels of demand generators ranging from office-related employment to retail, cultural, entertainment, and residential. The center core of the CBD is considered to be City Hall, which is located at Penn Square at the intersection of Market and Broad Streets. Center City Philadelphia is the focal point of the Greater Philadelphia Metropolitan Area for business, government and cultural activities. Center City Philadelphia offers a complimentary blend of historic architecture, some of the most regarded in the United States, residential communities featuring single family attached and multi-family rental and condominium development and modern office buildings. | |
The district is in the middle of the nation’s Northeast Corridor and at the center of a nine-county region of more than 5 million residents. The CBD employers benefit from the dense concentration of thousands of professional and business-service firms. About 70% of these employees take public transportation to work. It has a highly-skilled, well-educated private-sector workforce of about 235,000. Sixty-two percent of downtown residents have at least a college degree and nearly a third of Center city’s growing population is between ages 24 and 35. | ||
The City Center district has proximity to major colleges and universities and provides employers access to the latest research of colleges and steady stream of recent graduates. Employees are afforded excellent numerous opportunities for continuing education. | ||
Half of the employment in the district are employed in information, business, professional and financial services firms; followed by educational and health services, and retail, leisure and hospitality. A small number (about 6% of the workforce) are employed in manufacturing, construction, transportation and utilities. | ||
The district has 39.5 million square feet of Class A and Class B office space in close proximity to various complementary retail uses and also within short distance of public transportation and various parking facilities. Is home to nearly 9,000 businesses—the highest concentration of firms in the Philadelphia region, with a high percentage of businesses in financial, insurance, real estate, engineering and legal services. | ||
The City Center district boasts extraordinary amenities; including a wide array of arts and culture institutions, historic public markets, shops, restaurants and outdoor cafes adds to the extraordinary amenities. | ||
Access | Center City has extraordinary competitive advantages in transportation, real estate and labor costs, access to skilled labor, world-class amenities and an affordable cost of living. At the center of the northeast corridor, midway between Boston and Washington, D.C., Philadelphia is the second busiest stop on AMTRAK’s high speed line. It is also at the |
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center of a multi-modal regional transportation system, with an expanding international airport two hours flying time from 50% of the American population and with non-stop flights to 80 domestic and 40 international destinations, including most major European cities. With more than 2.2 million workers in the 11-county region, Center City Philadelphia has access to a diverse and talented workforce. For professional services firms, Philadelphia’s labor costs and office rents are also among the lowest in the Northeast. | ||
Center City has linkage with the Philadelphia region by two interstate highways, seven regional rail lines, a high speed rail line to New Jersey, two subways, 41 local and four regional bus lines and 150 miles of bicycled lanes. | ||
Regional linkages to Center City include I-76, I-95 and I-676 (Vine Street Expressway). I-676 links I-95 with the Schuylkill Expressway (I- 76) for efficient vehicular access to the suburban communities surrounding Philadelphia including those located in both Southeastern Pennsylvania and Southern New Jersey via the Benjamin Franklin Bridge, also located in Center City. For the most part, streets are laid out in a grid pattern with named streets extending in an east/west direction and numbered streets traveling north/south. Primary access to the immediate subject area is provided by Market Street, Chestnut Street, Walnut Street, JFK Boulevard, as well as Broad Street and several numbered one-way, north and south bound streets. | ||
An estimated 70% of downtown workers use public transportation to get to work and 8% walk to work. About 50% of Center City residents walk to work, more than any other major American city. Over 50% of Center City office workers cite “convenient commute” as the best feature of working downtown. Across all Center City neighborhoods, residents repeatedly cite the convenience to shopping and dining and the proximity to work as prime factors for choosing to live downtown. |
Education and Healthcare | Higher education and healthcare institutions comprise the second largest sector of Center City employment, accounting for 21% of all downtown jobs. Center City’s largest private employer, Thomas Jefferson University, provided 8,192 jobs and last May its Medical College announced the receipt of a five-year, $11.6 million grant from the National Heart, Lung and Blood Institute. In 2007, the last year for which data was available, these institutions attracted $101 million in research grants from the National Institutes of Health. They significantly impact their surrounding communities, attracting not only employees, but students and faculty who live in nearby housing and patronize adjacent retail and restaurants. | |
In 2008, downtown institutions educated over 28,000 students and served 54,000 patients, who in turn draw visitors who make substantial transportation and retail expenditures when downtown. Overall, Center City medical facilities recorded their eighth straight year of net patient revenue gains, totaling $1.84 billion in 2007. |
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Philadelphia health care institutions continue to expand, generating thousands of construction jobs. After a $70 million renovation in 2008, the University of Pennsylvania reopened the former Graduate Hospital as Penn Medicine at Rittenhouse, a complex consisting of a 38-bed long-term acute-care facility and a 58-bed inpatient rehabilitation facility. Community College of Philadelphia, with a total enrollment of more than 13,000, is the largest institution of higher education in Center City, while Curtis Institute of Music, the smallest with just 162 students, maintains an internationally renowned reputation for excellence. | ||
Collectively, Center City colleges and universities attracted almost 30,000 students downtown in the fall of 2008, while more than 70,000 students attend nearby institutions in University City and North Philadelphia, often living and shopping in Center City. The number of institutions and the enrollment in elementary and high schools in Center City continued to grow. Early kindergarten enrollment in four Center City schools — Bache-Martin, McCall, Meredith and Greenfield — drew nearly 50% from families within their immediate neighborhood, a strong indicator not only of the increasing number of school age children in Center City, but also that parents are choosing public schools in record numbers. Innovation and expansion also characterize Center City’s independent schools, which draw close to 70% of their students from downtown and continue to experience strong downtown demand for kindergarten. Friends Select recently installed one of Philadelphia’s first green roofs while St. Joseph’s Preparatory School and The Philadelphia School are in the midst of renovation and expansion campaigns. | ||
Tourism/Hospitality | In 1995, Philadelphia seriously entered the hospitality business with the opening of the 440,000 square foot Pennsylvania Convention Center, not at the margins, but in the center of downtown, within easy walking distance of hotels, restaurants and other attractions. This public investment prompted a 50% increase in the number of downtown hotel rooms and has been followed by investment in new attractions in the historic district. | |
Through an expanded hotel tax, marketing for conventions, trade shows and domestic and international tourism has significantly increased, yielding huge dividends for all the businesses and employees that benefit from expenditures by out-of-town guests. Today, Center City’s 10,450 hotel rooms comprise 25% of the region’s supply but generate 41% of all room revenue. Average daily room rates downtown have risen by 47% since 1996, reaching $172.55 in 2008. Given the slowing of the economy and the absence of a blockbuster exhibition like 2007’s King Tut at The Franklin Institute, occupancy rates dropped slightly from 73.6% in 2007 to 71% in 2008, but were still significantly above rates in the last recession. The 392,000 square foot expansion of the Pennsylvania Convention Center is well underway and will soon provide the largest contiguous meeting space in the Northeast. | ||
To accommodate increased activity, additional hotels are planned for downtown. From the new boutique Hotel Palomar property, to a large, |
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full-service property directly north of the Convention Center, Center City Philadelphia has 20 new hotels in various stages of construction, pre-planning and planning. | ||
Given the difficulties associated with financing in this environment, new hotel supply is likely to be added more slowly than anticipated over the next five years, making market absorption easier and keeping existing hotel occupancy rates from dropping substantially. Bookings for conventions of over 10,000 attendees are projected to expand, jumping from five major conventions totaling 56,000 attendees in 2008 to eight in 2009 generating an estimated 100,200 attendees. | ||
Gate shows at the Convention Center, such as the Flower Show, Auto Show and Home Show, brought an additional 556,000 visitors to downtown Philadelphia in 2008. Group meetings and conventions account for the largest share of hotel room revenues generated, with business travel second and tourism third. But the number of tourists to the Philadelphia region increased in 2007, the latest year for which data is available. | ||
The 29.3 million domestic tourists visiting the region in 2007 for day and overnight trips were joined by 550,000 overseas visitors, the highest number ever. While 10.6 million leisure visitors to the region stayed overnight in 2007, an additional 12.8 million were day-trippers, drawn by the ease of reaching a destination within a five-hour drive of one quarter of the U.S. population. Top tourist attractions continue to be historical sites, including Independence Visitor Center, which topped the list of destinations at 2.76 million visitors, an increase of nearly 400,000 over 2007. Visitation to the Liberty Bell Center showed a healthy increase as well, with 2.27 million visitors, almost 240,000 more than in 2007. Set soon to get a major $18 million make-over, Franklin Court, the bicentennial-era underground museum honoring Benjamin Franklin, drew close to 270,000 visitors in 2008. | ||
Arts and Culture | The number of arts and cultural institutions in Center City continue to expand; currently at 355, up 43% since 1996. Even without major blockbuster shows, the Franklin Institute, the National Constitution Center and the Philadelphia Museum of Art each attracted over 750,000 visitors in 2008, while the Kimmel Center drew 1 million patrons. Shows and exhibits with broad popular appeal topped the attendance list in 2008 with the National Constitution Center drawing 200,000 visitors to theBaseball As Americaevent,while the Kimmel Center attracted 320,000 to its series of Broadway plays. | |
At the same time, a broad range of small and medium-sized organizations and institutions animate nearly every neighborhood in Center City with strong clusters in Old City, around Rittenhouse Square and in emerging areas north of Vine Street. But the strongest concentration of arts and entertainment related employment remains along the Avenue of the Arts. More than 50 of these groups, including the Opera Company of Philadelphia, the Franklin Institute, and |
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Rosenbach Museum & Library received a total of $1.1 million from the Philadelphia Cultural Fund, created by an annual appropriation from the City of Philadelphia to support general operations of cultural groups citywide. Support was also generated by Mayor Nutter who fulfilled his campaign pledge to create an Office of Arts, Culture and the Creative Economy to improve access to arts, arts education and cultural opportunities as well as leverage the role of arts and culture in economic development. | ||
Livability | In nearly every North American city, the prime drivers of the downtown housing market have been young professionals and empty nesters. A 2006 survey of 3,000 Center City households confirmed that 40% were ages 25-34, while 22% were over 55, percentages that mirrored the 2000 Census. But among the 27% of downtown residents who were between ages 35 and 54, 22% responded that they had school-age children living at home. | |
Center City’s walk ability, the intimate scale of many of its residential communities, its diversity and cosmopolitan lifestyle with proximity to art schools, museums and other cultural institutions has become increasingly attractive to young families raising children. On average, since 2000, nearly 1,900 children have been born each year to Center City parents, for a cumulative total of 15,159 infants born between 2000 and 2007. | ||
While not every family with children has remained downtown, 3.2% of Center City’s population is now under age five. Center City has seen a corresponding jump in the number of preschool and day care centers, now totaling 31, many with waiting lists. More than ever, Center City public schools are attracting early kindergarten enrollment from families within their immediate neighborhood and independent schools are drawing upwards of 70% of their enrollment from downtown communities. All three of Center City’s independent schools are also in various stages of planned expansion. | ||
While outdoor cafes, bars, health-clubs and dog walks are primary draws for young professionals, clean, safe and attractive parks and playgrounds are essential for young families, as is the expansion of affordable, quality school choice. Amenities for children have clearly improved in Center City as eight public playgrounds totaling nearly 18 acres offer soccer and baseball fields, basketball and tennis courts, swimming pools and miniature golf. After school activities and sports leagues for children are growing in popularity. A secure bicycle trail along the Schuylkill River will soon be joined by one along the Delaware. | ||
Dating back to the mid-17th century, Philadelphia has had a long standing tradition of embracing parks and open spaces. With an average of 7.7 acres of parkland for each 1,000 residents, Philadelphia currently ranks 3rd (behind Washington, DC, and Boston) when compared with other metropolitan areas. Many of the region’s important park land and open space areas are located within the City Center district. These include an |
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array of facilities from expansive linear greenways along the Delaware and Schuylkill Rivers, Ben Franklin Parkway to small public squares and vest-pocket parkland. | ||
Construction and Infrastructure | During the last five years, the area has been growing, and many new residential properties have been redeveloped and/or renovated. The conversion of obsolete commercial office space within older Class B and C office buildings, as well as loft-style industrial buildings, into modern multi-family luxury apartments, student housing and hotels has been ongoing since the mid to late 1990’s. | |
Construction of Comcast Corporation’s world headquarters Comcast Center, a $495 million, 57-story; 1.2 million square foot office tower is completed. The building is located between 17th and 18th streets on JFK Boulevard and is the tallest building in the city. Also, another major new office building, the Cira Center, was built in the past few years just outside of Center City at 30th Street Station. This project is currently 100% leased. Brandywine Realty Trust, developer and owner, is now planning a second tower known as Cira Centre South which is proposed to be 42 stories and approximately 500,000 square feet. The building is expected to include a hotel, condominiums, apartments and lobby retail space but its status is questionable at the current time. | ||
Another major area of construction and development has been in the area of residential. The Symphony House is a recently completed $125 million, 37-story mixed use complex rising along Philadelphia’s Avenue of the Arts. Located at Pine and South, it comprises 167 units and is the home for the Philadelphia Theatre Company with 350 to 400 seats in addition to 35,000 square feet of retail space and a 400 vehicle parking garage. Also recently completed is the Murano, a $165 million, 42-story, 302-unit condominium tower at 21st and Market Streets. The Residences at Ritz Carlton, a $250 million, a 44-story condominium tower attached to the existing Ritz Carlton Hotel was recently completed and owners have begun to move-in. This property contains 280 units and was developed by the Arden Group. | ||
There are also major high rise condominium projects under construction at this time which include: 10 Rittenhouse located near the corner of 18th and Walnut Streets and facing Rittenhouse Square will offer condominium units and ground level retail, the first to be developed on Rittenhouse Square for over 20 years. 1706 Rittenhouse located at 17th and Rittenhouse Square Street is under construction. The building is planned to be 31 stories and include 29 units — one per floor. Construction is expected to be completed by Spring 2010. | ||
Girard Square is a strategic city-block that could see dramatic changes over the long run. Recently acquired via a $90 million pre-funded, 75-year ground lease agreement with Girard Estate to develop the block bounded by Chestnut and Market Streets and 11th and 12th Streets. This |
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site sits across the Pennsylvania Convention Center and is a gateway to Market Street East. | ||
As previously discussed, the Pennsylvania Convention Center will undergo a publicly funded $700 million expansion adding 376,000 square of exhibition space to the current 624,000 square feet. The project will be the largest capital project in Pennsylvania history and, once completed, will have the largest contiguous space in the Northeast. | ||
In total there has been an estimated $12.3 billion in new private development invested in the City Center area since 2007. These included residential, office, hospitality, healthcare, entertainment, and academic projects. | ||
Conclusion | In summary, the subject neighborhood is an established and desirable area that offers a broad range of services and good access to other parts of the city. Road infrastructure throughout the subject neighborhood is in the process of being upgraded and considered good. The neighborhood is adequately serviced by public utilities and community facilities. The neighborhood is designed to serve the needs of local residents and businesses. There appears to be no detrimental influences upon the neighborhood, which would inhibit the income-producing capabilities of the subject property. The long-term prospects for the neighborhood and the subject property are positive. |
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SITE ANALYSIS | ||
Location | The northwest corner of John F. Kennedy Boulevard and N. 18thStreet, City of Philadelphia, Philadelphia County, Pennsylvania. The location is approximately 0.25 miles south of Vine Street Expressway (I-676) and 0.50 miles east of the Schuylkill River. The subject neighborhood is considered to be the City Center district, a highly urbanized area that incorporates downtown Philadelphia, and many of the region’s most important developments. The physical address of the property is 1815 JFK Boulevard, City of Philadelphia, Philadelphia County, Pennsylvania. | |
Site Area | Total land area equates to 0.891 acres, or 38,808 square feet. | |
Street Frontage | The subject site is an entire city block fronting along the north side of John F. Kennedy Boulevard (400 linear feet), the west side of N. 18thStreet (80 linear feet), east side of N. 19thStreet (80 linear feet) and south side of Cuthbert Street (400 linear feet). The street frontage is urban with concrete walkways and curbing, and crosswalk controls at intersections. | |
Topography | The site is slightly sloping; however, is on grade with the bounding streets. | |
Shape | The parcel is rectangular in shape. The size, shape, and configuration of the subject property provide a functional layout, which is typical of the urbanized area of the neighborhood. | |
Excess/Surplus Land | There is no excess or surplus land. | |
Utilities | All customary municipal services and utility hookups are provided. | |
Soil Information | No adverse conditions were readily apparent. | |
Flood Information | The subject property is situated in Flood Zone “X”, which is an area outside of the 500-year flood plain and protected by levee from 100-year flood events. FEMA Map 4207570183G, dated January 17, 2007. | |
Easements and Encroachments | No title report or survey showing the location of easements was provided in connection with this assignment. Thus, it is not possible to make a definitive conclusion regarding any potential impacts on value of the location of any such easements or encroachments. Visual observations of the site revealed no adverse easements or encroachments. It appears as though the site is encumbered by utility and access easements typical of a developed site. It is specifically assumed that any easements, restrictions or encroachments that might appear against the title would have no adverse impact on marketability or value. | |
Environmental | No readily observable adverse environmental site conditions were noted. No environmental reports were provided for review. |
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Accessibility/Visibility | Pedestrian sidewalks serve the periphery of the subject property. Primary pedestrian ingress and egress to the property is via the John F. Kennedy Boulevard. Vehicular access to the parking garage and service area is from a curb cut along the south side of Cuthbert Street. Accessibility of the site is good. The buildings are at street grade and visible to passing traffic. | |
Improvements | A 30-story mixed use high rise development with apartments, office, and retail uses. Additional improvements include on-site management office, roof-top swimming pool, and below-grade parking garage. | |
Surrounding Uses | North Side: Parking Lot | |
South Side: High-rise Office | ||
East Side: High-rise Office | ||
West Side: High-rise Residential | ||
Conclusions | The site attributes are well suited for the existing development and use. |
AERIAL PHOTOGRAPH OF SUBJECT SITE
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597910.gif)
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IMPROVEMENT ANALYSIS | ||
Year Built/Renovated | The facility was completed in 1961 and renovated in 1998. Ongoing maintenance and repairs have kept the property in average physical condition. | |
Layout & Configuration | The development is a 30-story high-rise mixed-use project consisting of 535 apartment units comprising 517,490 square feet, 22,874 square feet of street-level retail space and 93,676 square feet of multi-tenant office space. The total rentable area of the facility is 634,040 square feet. Additional site improvements include a 125-space below-grade parking garage, roof-top swimming pool, on-site property management and fitness center. | |
Leasable Area/Unit Mix | The residential portion comprises the predominate use of the subject property. It consists of 535 apartment units containing 517,490 square feet. The following chart summarizes the unit mix and sizes of the various floor plans that comprise the residential component at the subject property. |
APARTMENT UNIT MIX AND FLOOR AREAS
Unit Type | Floor Plan | Mix | Size (SF) | Total Area | ||||||||||||
Studio | EA10 | 1 | 390 | 390 | ||||||||||||
Studio | EB10 | 10 | 410 | 4,100 | ||||||||||||
Studio | EC10 | 20 | 430 | 8,600 | ||||||||||||
Studio | ED10 | 125 | 460 | 57,500 | ||||||||||||
Studio | EE10 | 5 | 520 | 2,600 | ||||||||||||
Studio | EF10 | 2 | 640 | 1,280 | ||||||||||||
1BR/1BA | 1A10 | 17 | 550 | 9,350 | ||||||||||||
1BR/1BA | 1B10 | 28 | 800 | 22,400 | ||||||||||||
1BR/1BA | 1C10 | 33 | 870 | 28,710 | ||||||||||||
1BR/1BA | 1D10 | 88 | 950 | 83,600 | ||||||||||||
1BR/1BA | 1E10 | 16 | 970 | 15,520 | ||||||||||||
1BR/1BA | 1F10 | 3 | 1,000 | 3,000 | ||||||||||||
2BR/2BA | 2A20 | 33 | 1,200 | 39,600 | ||||||||||||
2BR/2BA | 2B20 | 13 | 1,290 | 16,770 | ||||||||||||
2BR/2BA | 2C20 | 2 | 1,350 | 2,700 | ||||||||||||
2BR/2BA | 2D20 | 71 | 1,420 | 100,820 | ||||||||||||
2BR/2BA | 2E20 | 3 | 1,590 | 4,770 | ||||||||||||
2BR/2BA | 2F20 | 28 | 1,790 | 50,120 | ||||||||||||
3BR/2BA | 3A20 | 11 | 1,550 | 17,050 | ||||||||||||
3BR/2BA | 3B20 | 11 | 1,650 | 18,150 | ||||||||||||
3BR/2BA | 3C20 | 7 | 1,900 | 13,300 | ||||||||||||
3BR/2BA | 3G20 | 5 | 2,060 | 10,300 | ||||||||||||
3BR/2BA | 3D20 | 1 | 2,140 | 2,140 | ||||||||||||
3BR/2BA | 3E20 | 1 | 2,370 | 2,370 | ||||||||||||
4BR/2BA | 4A30 | 1 | 2,350 | 2,350 | ||||||||||||
Totals/Average | 535 | 967 | 517,490 |
Source: Client provided rent roll data and floor plans; compiled by CRA
Floor Plans | As indicated, the property offers a variety of studio, one, two, three and four-bedroom floor plans, which is typical of the market. Each floor plan provides a living room off a small entry foyer and dining and kitchen area. Washer and dryer appliances are provided in each unit. Other features include carpeted flooring, central heating/cooling, cable TV connections, walk-in closets (select units) and balcony (select units). | |
Commercial Area | As previously noted The Sterling includes office and retail uses. The office component consists of 92,676 square feet of rentable area located on floors 2 thru 4. The office area is accessible a separate lobby and elevators that |
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serve the commercial portion of the subject property. Office space is considered to be Class B by local standards. | ||
The retail component consists of 22,874 square feet of rentable area located on the ground floor. The retail area is typical retail storefronts located along the John F. Kennedy Boulevard street frontage. | ||
EXTERIOR | ||
Structure | The foundations consist of reinforced concrete piers with perimeter foundation. Structural framing is structural concrete and steel. | |
Floors | The floors are constructed of poured in-place reinforced concrete. The ceiling height clearance ranges between 8 to 10 feet. | |
Walls | Exterior walls of the building consist of concrete and masonry. | |
Windows | Individual unit windows are double pane glass set in aluminum frames. Entry doors are metal clad set in metal frames. | |
Roof | The building roof is flat with built-up cover over steel and concrete decking. | |
INTERIOR FINISHES | ||
Walls and Ceilings | Textured and painted drywall. | |
Flooring | Wall-to-wall carpeting throughout except for vinyl tile at the bathrooms, kitchens and entry foyers. | |
Kitchens | Typical appliance package consisting of a frost-free refrigerator/freezer, full-size electric range with oven and over-cabinet exhaust fan, dishwasher, and garbage disposal. Cabinets are painted wood. | |
Bathrooms | Shower/tub, toilet, vanity with sink and mirrored medicine cabinet. Tubs have a ceramic tile wainscoting. | |
Amenities | Controlled entry/access to residential and commercial area. Washer/dryer appliances, cable TV connections, walk-in closets (select units), balcony area (select units). Garage parking in building available. | |
MECHANICAL SYSTEMS | ||
HVAC | Air and heat is provided by central gas fired boilers with closed loop system chillers. Residential tenants pay their pro-rata share of heating and cooling costs. The system is similar to competing properties. | |
Electric Service | Adequate electric service is provided. Each apartment and commercial space has a separate panel and is individually metered. | |
Plumbing | Assumed to meet current code requirements. The building (residential and commercial component) is served by a central gas-fired water heater system. Water and sewer charges are billed to residential tenants separately by the property based on a RUBS billing system. |
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Fire Protection | No sprinkler system is present on the property. Fire and smoke detection system consists of individual detection in each apartment unit. | |
Security | The property has controlled access entry with 24-hour lobby concierge. | |
Elevators | A bank of four elevators serve the residential component of the subject building (floors 5 through 29) while a separate bank of three elevators serve the office component of the property. | |
ANCILLARY AREAS | ||
Storage Spaces | No additional storage lockers are provided. | |
Loading Facilities | Tenant moving occurs from the service area located along the Cuthbert Street frontage. | |
Landscaping | Landscaping is minimal. | |
Parking | Parking is available within the parking garage located below the building. Contracts rates are approximately $275 per month. Public transportation (bus and subway service) is proximate to the subject property. In addition, there are a number of nearby surface parking lots offering contract parking. | |
Recreational Amenities | An Olympic-sized roof top swimming pool and 24-hour fitness center. Amenities are similar to competitive properties. | |
FF&E | ||
Personal Property | The subject property has office furnishings and equipment for the leasing/ management staff at the on-site management office, as well as furniture and various chairs and tables for the pool deck, as well as fitness center equipment. Kitchen appliances are also part of personal property. The | |
FF&E are similar to competitive properties. | ||
CONDITION/MAINTENANCE | ||
Exterior | Average condition. Overall maintenance appears adequate. | |
Roof | Average condition. On-site management reported no roof leaks. | |
Interiors | Average condition. Overall maintenance appears adequate. | |
Common Area Amenities | Average condition. Overall maintenance appears adequate. | |
Sidewalks & Paving | Average condition. Overall maintenance appears adequate. | |
Landscaping | Average condition. Overall maintenance appears adequate. | |
Environmental Conditions | No readily observable adverse conditions were noted during the site visit. | |
ELEMENTS OF DEPRECIATION | ||
Based on our field inspection, we note that some elements of depreciation are present at the subject property. |
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Physical Deterioration | The overall physical condition is average with adequate maintenance levels. Physical deterioration is primarily limited to general aging and normal wear and tear. No material elements of deferred maintenance were noted during the appraiser’s inspection of the property. Carpet and mechanical equipment in the individual units are updated and/or replaced on an as-needed basis. According to Marshall Valuation Service, buildings similar to the subject property have an economic life of approximately 60 years. The actual average age of the property is estimated at 49 years. As a result of on-going maintenance, the effective age is estimated to be slightly less than the actual age of the improvements. The effective age is estimated at 35 to 45 years. | |
Capital Improvements | Several capital improvements are planned in the near term; including re-locating the management/leasing office into a vacant retail space and upgrades to the building fire and smoke detection system. | |
Functional Obsolescence | The subject property represents standard design, systems and floor plans consistent with traditional garden style apartment complexes. The property has operated at rental rates and occupancy levels that are consistent with that of other similar properties within the influencing market, attesting to its functional adequacy and market acceptance. Considering these factors, no adjustment for functional obsolescence is required. | |
External Obsolescence | External obsolescence is a loss in value resulting from conditions that are present outside the subject property and is usually incurable. No site-specific external obsolescence was noted. Most, if not all of the adjacent properties and nearby uses benefit the subject property. | |
Conclusions | The subject improvements have adequate functional utility, conform well to the general character of the neighborhood and are generally similar to competitors. |
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ZONING ANALYSIS | ||
District | The subject site is under the City of Philadelphia zoning jurisdiction and is in the “C-5” Commercial District. This is a high density urban zoning district. | |
Uses | The purpose of this district is to allow for types of uses that are commonly found in and compatible with, a high-density business core. Allowable uses include multi-family dwellings, government building and uses, office, retail, parking garages, public and nonprofit institutions of an educational, religious or cultural type excluding corrective institutions and hospitals and public utility uses. Mixed uses are encouraged and public spaces are an integral requirement of this zoning designation. | |
Bulk Restrictions | For properties located along the John F. Kennedy Boulevard, there are no maximum height or minimum setback requirements. The maximum floor area for the subject site is 1,500 percent. There is no minimum lot size or maximum lot coverage requirements. However, other requirements of the “C-5” District (public space, parking, connector space, etc.) can greatly impact the utility of a site. | |
Parking Requirements | Parking requirements under the “C-5” District depend on uses and mix. Currently the subject property offers 125 on-site parking spaces for the 634,040 square feet of rentable area (residential, retail and office components). This equates to a parking ratio of 5.2 spaces per 1,000 square feet of rentable area. This ratio appears to be reasonable for high density central-core developments. However, management indicated that most residents do not own automobiles and therefore demand for on-site parking is minimal from subject residents. | |
Compliance | The Philadelphia zoning requirements are extremely complex and it is recommended that a local zoning expert/attorney be hired to determine the compliance of the existing improvements with local zoning requirements. It is our opinion that due to the age of the improvements, factored against the changes in local zoning which have occurred since the original construction date of the subject property, the current improvements represent a non-conforming use of the site. |
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REAL ESTATE ASSESSMENTS AND TAXES | ||
Assessor’s Identification | The subject property is identified by the Philadelphia Board of Revision of Taxes as Account Number 881035000. | |
Overview | Real property taxes are based on multiplying the “Taxable Value”, which is 32% of the “Fair Market Value” (FMV) as determined by the Philadelphia Board of Revision Taxes, by the Tax Rate, which is determined by municipal budgets. Real property taxes include amounts for the city, county and school as well as other municipal districts. | |
The tax year is based on a calendar year, payable in advance. The FMV is supposed to reflect total property value as of January 1 of each year. The Tax Rate is typically determined after the assessments have been finalized prior to billing in August. Payment is due without penalty by March 31. | ||
The assessor can use all three of the standard appraisal methods to establish an equitable FMV, and the amount is not automatically changed due to a sale. Citywide revaluations are required at least every four years; however, the assessor has the authority to re-evaluate property annually. According to the assessor, a property’s sale price does not directly impact the assessment during the subsequent revaluations but is included in the general market pricing trend. | ||
The subject property is under the taxing jurisdiction of the City of Philadelphia and Philadelphia School District. In addition, the subject property is within the Center City District, a special taxing authority. | ||
Assessments | The subject’s 2009 market value is $30,528,300, no change from the prior year (2008) assessment. At the 32% equalization rate the subject property has a taxable value of $9,769,056. | |
Comparable Assessments | Similar properties within the subject property’s immediate vicinity were surveyed to ascertain the reasonableness of the subject property’s current assessed value. Considering the age of the subject property, in comparison to the tax comparables, the subject property’s assessment appears to be reasonable. The properties are included in the subject’s tax group by the assessor due to similarities in taxing district, building age and size. |
TAX COMPARABLES
Property | YOC | Assessed Value | Total Units | Per Unit Assessment | ||||||||||||
Subject Property | 1961/1998 | $ | 30,528,300 | 535 | $ | 57,062 | ||||||||||
Museum Towers | 1989/2008 | $ | 14,550,000 | 228 | $ | 63,816 | ||||||||||
1835 Arch Street | 1924/2001 | $ | 25,155,500 | 191 | $ | 131,704 | ||||||||||
1500 Locust | 1973/2008 | $ | 39,251,500 | 610 | $ | 64,347 |
Source: Philadelphia Board of Revision of Taxes, compiled by CRA
Property Tax Abatement | To our knowledge, the subject property does not participate in any property tax abatement programs. | |
Tax Rate | Tax rates have remained relatively stable over the past several years as valuations have increased modestly. The 2009 total tax rate applicable for all taxing authorities with jurisdiction over the subject property |
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(including the Center City District) equates to $89.9839026 per $1,000 of assessed value. | ||
Real Estate Tax Projection | Near term increases in reassessments are not expected and tax rates are expected to remain relatively stable. The total tax expense is anticipated to increase at a rate below the average inflation rate | |
Tax Calculation | The subject’s real estate tax liability is calculated at $879,100 rounded, as follows. | |
Taxable Value x Tax Rate/$1000 = Tax Liability | ||
$9,709,056 x $89.98390326/$1000 = $879,058 | ||
Projecting for minor inflationary growth a first year tax expense of $880,812 is estimated for the subject property. Based on historical allocation of these expenses we have utilized the following expense estimates for the residential and commercial components of the subject property. | ||
Residential @ 85% of total tax expense = $748,700 | ||
Commercial @ 15% of total tax expense = $132,100 |
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APARTMENT MARKET ANALYSIS | ||
Introduction | The following apartment market analysis is designed to provide the reader an understanding of the metropolitan Philadelphia apartment market and the local submarket within which the subject property competes. The most recent source of data available to the appraisers was the “Philadelphia Apartment Research Market Update — Fourth Quarter 2009”, prepared by Marcus & Millichap Real Estate Investment Services. In addition, we utilized data contained within several additional reports including “Center City Residential Development: 2009” prepared by the Central Philadelphia Development Corporation, and “Philadelphia Residential Market Study Report” prepared for AIMCO by Integra Realty Resources (September 2009). | |
Philadelphia Overview | The Philadelphia apartment market is expected to continue to face challenges operationally through year end 2009, although a decline in construction activity and deceleration in job cuts may help slow vacancy increases in quarters ahead. Metro-wide multi-family rental stock has expanded by just 0.6% since the beginning of 2009, and there are only about 1,100 units under way. Additionally, just 2,800 units are in the planning pipeline, a 50% decline from early 2009. Along with a limited pace of deliveries through 2010, the rate of job losses in the metro also continues to slow. Fewer than 1,600 positions were lost in August 2009, representing the smallest number of cuts since layoffs started in September 2008. Increased expansion and hiring announcements lend support to an eventual economic recovery. A new Wal-Mart, for example, will open in Warminster this fall, creating 350 jobs. In the meantime, however, owners can expect an increase to vacancy in the fourth quarter 2009 due to softer near-term employment-generated demand, which will likely translate to additional concessions as owners compete for tenants. | |
Investor interest will likely gain momentum in 2010 as signs of a recovery become clearer. While transaction velocity is down nearly 30% since the beginning of 2009 compared to the same period in 2008, sales activity has picked up slightly over the past few months. Cap rates, meanwhile, continue to trend higher, with Class A assets averaging in the high 6% to low 7% range and Class B properties trading in the high 7% to low 8% range. Initial yields for each class are up about 25 to 50 basis points during the past year. Rising yields and expectations for sturdier operations may begin to draw experienced local investors back into the market over the next year. Buyers interest in that time will likely center on well-located, stabilized assets in high-demand areas such as University City and Center City, as well as along the Main Line. The following are key challenges currently facing the Philadelphia apartment market. | ||
Employment: Total employment in the metro area is expected to decrease by 2.8%, or 80,000 jobs in 2009, as cuts in the manufacturing and trade, transportation and utilities sectors persist. In 2008, 46,100 jobs were removed from the market. Local employers cut nearly 7,000 jobs |
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in the third quarter 2009. Since the start of the year, total employment has decreased by 60,000 positions, compared with the removal of 8,000 workers from payrolls during the corresponding period in 2008. The trade, transportation and utilities sector has reduced payrolls by the greatest absolute amount year to date, declining 2.3% with the loss of 12,000 jobs. A significant number of the jobs lost are related to the retail segment, which has been effected by declining consumer sales. The unemployment rate in Philadelphia was 8.5% as of July 2009, up from 6.7% in December. Unemployment should stabilize during the fourth quarter as the job market steadies. | ||
Housing and Demographics: Permits for an estimated 1,100 units of multi-family housing were issued during the 12 months ending in the third quarter 2009, a decline of 53% from the preceding year. Developers have pulled permits for approximately 4,700 single-family units over the last year, down 23%. Builders continue to scale back projects in response to the sluggish housing market. The median price of an existing single-family home in the Philadelphia metro was estimated at $190,000 in the third quarter 2009, a 16% decrease from one year earlier. Demand for single-family housing has slowed in response to tighter financing requirements and falling prices. Despite the drop in the median price, the debt service on a median-priced home exceeds the average Class B/C asking rent by about $193 per month. One year ago, the cost of a mortgage on a median price Philadelphia metro home exceeded Class B/C asking rent payments by more than $500 per month, illustrating the increasing affordability of single-family homes. Renters in lower-tier units will find for-sale space more affordable as the year progresses, but homeownership will likely remain out of reach due to more conservative financing requirement | ||
Construction: Apartment completions have declined in the past twelve months to 1,200 units, expanding rental stock by 0.2%. In the preceding 12-month period, 1,600 units were added. There are approximately 1,200 units under construction in the market, all of which have scheduled delivery dates in 2010. The pipeline of planned projects totals approximately 3,000 units, down from 5,000 units one year ago. Job losses, rising vacancy and difficulty obtaining construction financing are limiting development activity. A year after builders delivered 1,300 apartment units, 500 units will be added to the Philadelphia market in 2009. Completions will expand rental inventory 0.3%, compared with supply growth of 0.7% in 2008. | ||
Vacancy: Despite a significant slowdown in construction activity in 2009, softer renter demand due to job losses will push vacancy higher. By year end 2009, vacancy is forecast to reach 6.5%, up from 5.7% at the close of 2008. Softer employment-generated demand has driven up vacancy over the last 12 months, despite limited construction activity. During that time, the average apartment vacancy rate has climbed 110 basis points to 6.2%. In the market’s Class A complexes, vacancy has held steady at 7.1% since the beginning of 2009. The rate has increased 110 basis points year over year, however, due to staff reductions among |
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companies in the professional and business services sector. Estimated third quarter vacancy of 5.5% at Class B/C properties marks a 40 basis point rise from the end of 2008. Vacancy in lower-tier units has been steadier than in Class A apartments due to greater demand for more affordable housing options. | ||
Rents: During the 12 months ending in the third quarter 2009, asking rents fell 0.8% to $1,018 per month, and effective rents dropped 1.8% to $971 per month. Asking rents are expected to decline 1.1% to $1,012 per month, while effective rents are projected to fall 2.4% to $960 per month by year-end 2009. In 2008, asking and effective rents rose 3.7% and 3.5%, respectively. | ||
In the market’s Class A segment, asking rents declined 0.9% through the first three quarters of 2009 to $1,216 per month, 1.2% less than one year earlier. Class B/C asking rents were $836 per month in the third quarter 2009, a decrease of 0.4% year to date and 0.8% year over year. Concessions have expanded in response to rising vacancy. Concessions were 4.7% of asking rents in the third quarter, up from 3.8% of asking rents in the same quarter in 2008. | ||
Sales Trends: Over the past trailing 12 months through 3rdquarter 2009, transaction velocity has declined 15%, compared with a 16% drop in the previous year. The median price of properties sold during the last year was $62,500 per unit, a decrease of 7% from the preceding 12-month period, when the median price fell 5%. In the past year, cap rates have averaged in the high 6% to low 7% range for Class A properties and Class B properties have averaged in the high 7% to low 8% range and above. Cap rates have risen about 50 basis points year over year. Sales activity is expected to remain subdued in the near term due to investors’ expectations for rising vacancy and increasing concessions. Cap rates will likely continue to trend higher in 2010, potentially drawing more buyers back into the market. | ||
Capital Markets: Compared to other core property sectors, apartments have fared best due to the availability of financing through government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. Recent modifications to GSE guidelines will impact lender decisions, however, as borrower requirements include more substantial apartment ownership experience. Loan-to-value requirements range from 55% to 75%. Portfolio lenders are issuing loans at all-in rates of 6.00% to 6.75% for a five-year term and 6.9% to 8.0% for a 10-year term. Rates among agency lenders are roughly 150 basis points to 175 basis points lower. | ||
The government recently assumed full control of Fannie Mae and Freddie Mac, which may boost confidence in the GSEs, putting downward pressure on rates, but it also creates several near-term uncertainties. Delinquencies will rise further as a wave of maturities approaches; however, at-risk borrowers may find lenders amenable to loan extensions and modifications. |
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Outlook | Operational performance in the Philadelphia apartment market is expected to remain soft in the near term, although limited development activity and a projected resumption of job growth point to long-term stability. Despite the uptick in completions later in the year, stock will increase by a meager 0.5%. Further, the new units that are scheduled to come online are located in areas of higher renter demand, including the Lower Merion and Central Chester County submarkets. Consequently, the deliveries should not significantly affect vacancy. | |
On the demand side, easing job cuts through midyear 2010 will be followed by limited hiring, helping to steady apartment demand. Employment will continue to strengthen over the long term as more companies expand and begin to rehire. Fisker Automotive, for instance, recently agreed to purchase the shuttered General Motors plant in Wilmington. The firm will create 2,000 factory jobs and 3,000 vendor positions by 2014. | ||
Investment activity may pick up in 2010 as the pricing disconnect between buyer and seller continues to narrow. Owners who are seeking exit strategies might consider listing assets, as rising expenses and property taxes, along with minimal rent gains, will likely suppress near-term income growth. Investors, meanwhile, may increasingly realize that the bottom of the market was nearly reached last year, highlighted by historically low interest rates, increasing cap rates and struggling NOIs. | ||
Cap rates currently average in the 8% range and appear to be stabilizing, although softer fundamentals may apply downward pressure on pricing in the near term. Over the long term, Philadelphia will remain a stable market for apartment investment due to expectations for steady employment and a slowdown in supply additions. | ||
Supply/Demand | The following table is a summary of the supply and demand trends for multifamily housing indicators in the Philadelphia area. |
PHILADELPHIA APARTMENT MARKET TRENDS
Inventory | Completions | Net Absorption | Effective Rent | |||||||||||||||||||||
Year | (Units) | (Units) | Vacancy % | (Units) | Per Unit | % Change | ||||||||||||||||||
YE 2000 | 191,545 | 927 | 1.6 | % | 2,737 | $ | 780 | 5.5 | % | |||||||||||||||
YE 2001 | 193,230 | 1,685 | 2.5 | % | (43 | ) | $ | 803 | 2.9 | % | ||||||||||||||
YE 2002 | 194,443 | 1,413 | 3.3 | % | (502 | ) | $ | 819 | 2.0 | % | ||||||||||||||
YE 2003 | 194,850 | 591 | 3.8 | % | (465 | ) | $ | 845 | 3.2 | % | ||||||||||||||
YE 2004 | 195,972 | 2,392 | 4.0 | % | 582 | $ | 869 | 2.8 | % | |||||||||||||||
YE 2005 | 196,957 | 2,738 | 4.4 | % | 123 | $ | 890 | 2.4 | % | |||||||||||||||
YE 2006 | 197,890 | 2,091 | 4.5 | % | 746 | $ | 922 | 3.6 | % | |||||||||||||||
YE 2007 | 198,111 | 643 | 4.2 | % | 909 | $ | 964 | 4.6 | % | |||||||||||||||
YE 2008 | 199,434 | 1,323 | 5.7 | % | (1,572 | ) | $ | 984 | 2.1 | % | ||||||||||||||
YE 2009 | 199,885 | 531 | 6.3 | % | (702 | ) | $ | 973 | -1.1 | % | ||||||||||||||
2010 Proj. | 200,602 | 717 | 6.6 | % | 89 | $ | 973 | 0.0 | % | |||||||||||||||
2011 Proj. | 201,484 | 882 | 6.3 | % | 1,371 | $ | 984 | 1.1 | % | |||||||||||||||
2012 Proj. | 202,289 | 805 | 6.2 | % | 1,072 | $ | 1,001 | 1.7 | % | |||||||||||||||
2013 Proj. | 203,252 | 963 | 6.2 | % | 918 | $ | 1,025 | 2.3 | % |
The Philadelphia multifamily market contains an overall inventory of about 199,510 units. Overall inventory has increased at a 0.5% annual compound rate since 2000. Inventory is projected to increase by 0.38% |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 35 |
annually over the next five years. The market has generally weakened since 2007. The overall vacancy rate is estimated to be 6.0% as of the current time, which represents an increase from a low mark of 4.2% reported in 2007. Absorption has been negative over the past year as the multifamily market has felt the effects of the increasing unemployment rates and difficult economic conditions. Vacancy rates for multifamily properties tend react quickly to unemployment rates. Typically, in recessionary economic cycles, renters will attempt to minimize housing costs by moving in with family members or moving in with roommates. These actions cause vacancy rates to increase. Accordingly, there has been negative absorption of 1,872 units during 2008 and an additional 457 units during the first half of 2009. Absorption is projected to continue on a negative path through the remainder of 2009. However, as the economy begins to stabilize and grow again, absorption is expected to return to positive levels in 2010. | ||
The effective rental rate is $980 per unit, which represents a slight decrease from a high mark of $984 per unit in 2008. Rental rates are expected to be stagnant through 2010 before regaining momentum in 2011. | ||
City Center Submarket | The subject is a Class A property located in the Center City multifamily submarket. Key supply and demand indicators for all classes of properties in this submarket are displayed in the table below, followed by separate tables showing Class A properties and Class B/C properties. |
CITY CENTER SUBMARKET APARTMENT MARKET TRENDS
Inventory | Completions | Net Absorption | Effective Rent | |||||||||||||||||||||
Year | (Units) | (Units) | Vacancy % | (Units) | Per Unit | % Change | ||||||||||||||||||
YE 2000 | 15,450 | 148 | 1.0 | % | 239 | $ | 1,213 | 11.7 | % | |||||||||||||||
YE 2001 | 15,981 | 531 | 2.9 | % | 222 | $ | 1,197 | -1.3 | % | |||||||||||||||
YE 2002 | 16,572 | 791 | 5.8 | % | 93 | $ | 1,240 | 3.6 | % | |||||||||||||||
YE 2003 | 16,767 | 195 | 5.6 | % | 217 | $ | 1,293 | 4.3 | % | |||||||||||||||
YE 2004 | 15,960 | 463 | 6.0 | % | (826 | ) | $ | 1,358 | 5.0 | % | ||||||||||||||
YE 2005 | 15,312 | 265 | 4.6 | % | (394 | ) | $ | 1,396 | 2.8 | % | ||||||||||||||
YE 2006 | 15,261 | 874 | 4.4 | % | (18 | ) | $ | 1,451 | 3.9 | % | ||||||||||||||
YE 2007 | 15,261 | 0 | 5.0 | % | (92 | ) | $ | 1,520 | 4.8 | % | ||||||||||||||
YE 2008 | 15,261 | 0 | 5.2 | % | (31 | ) | $ | 1,558 | 2.5 | % | ||||||||||||||
YE 2009 | 15,417 | 156 | 6.0 | % | 28 | $ | 1,549 | -0.6 | % | |||||||||||||||
2010 Proj. | 15,417 | 0 | 6.5 | % | (80 | ) | $ | 1,549 | 0.0 | % | ||||||||||||||
2011 Proj. | 15,492 | 75 | 6.7 | % | 34 | $ | 1,564 | 1.0 | % | |||||||||||||||
2012 Proj. | 15,492 | 0 | 7.4 | % | (99 | ) | $ | 1,586 | 1.4 | % | ||||||||||||||
2013 Proj. | 15,492 | 0 | 7.4 | % | 0 | $ | 1,622 | 2.3 | % | |||||||||||||||
CITY CENTER SUBMARKET — CLASS A APARTMENT MARKET TRENDS | ||||||||||||||||||||||||
Inventory | Completions | Net Absorption | Effective Rent | |||||||||||||||||||||
Year | (Units) | (Units) | Vacancy % | (Units) | Per Unit | % Change | ||||||||||||||||||
YE 2000 | 8,712 | 148 | 0.9 | % | 175 | $ | 1,490 | 10.5 | % | |||||||||||||||
YE 2001 | 9,243 | 531 | 2.5 | % | 374 | $ | 1,524 | 2.3 | % | |||||||||||||||
YE 2002 | 9,780 | 737 | 7.6 | % | 27 | $ | 1,550 | 1.7 | % | |||||||||||||||
YE 2003 | 9,975 | 195 | 6.3 | % | 307 | $ | 1,596 | 3.0 | % | |||||||||||||||
YE 2004 | 9,568 | 463 | 6.9 | % | (434 | ) | $ | 1,693 | 6.1 | % | ||||||||||||||
YE 2005 | 8,965 | 265 | 4.7 | % | (368 | ) | $ | 1,729 | 2.1 | % | ||||||||||||||
YE 2006 | 9,315 | 874 | 4.5 | % | 352 | $ | 1,785 | 3.2 | % | |||||||||||||||
YE 2007 | 9,315 | 0 | 6.0 | % | (135 | ) | $ | 1,875 | 5.0 | % | ||||||||||||||
YE 2008 | 9,315 | 0 | 5.9 | % | 5 | $ | 1,913 | 2.0 | % | |||||||||||||||
2009 (2 Qtr.) | 9,471 | 156 | 6.9 | % | 54 | $ | 1,921 |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 36 |
CITY CENTER SUBMARKET — CLASS B/C APARTMENT MARKET TRENDS
Inventory | Completions | Net Absorption | Effective Rent | |||||||||||||||||||||
Year | (Units) | (Units) | Vacancy % | (Units) | Per Unit | % Change | ||||||||||||||||||
YE 2000 | 6,738 | 0 | 1.2 | % | 64 | $ | 873 | 13.5 | % | |||||||||||||||
YE 2001 | 6,738 | 0 | 3.4 | % | (152 | ) | $ | 931 | 6.6 | % | ||||||||||||||
YE 2002 | 6,792 | 54 | 3.2 | % | 66 | $ | 982 | 5.5 | % | |||||||||||||||
YE 2003 | 6,792 | 0 | 4.5 | % | (90 | ) | $ | 998 | 1.6 | % | ||||||||||||||
YE 2004 | 6,392 | 0 | 4.7 | % | (391 | ) | $ | 1,001 | 0.3 | % | ||||||||||||||
YE 2005 | 6,347 | 0 | 4.4 | % | (26 | ) | $ | 1,029 | 2.8 | % | ||||||||||||||
YE 2006 | 5,946 | 0 | 4.2 | % | (371 | ) | $ | 1,056 | 2.6 | % | ||||||||||||||
YE 2007 | 5,946 | 0 | 3.5 | % | 43 | $ | 1,095 | 3.7 | % | |||||||||||||||
YE 2008 | 5,946 | 0 | 4.1 | % | (36 | ) | $ | 1,133 | 3.5 | % | ||||||||||||||
2009 (2 Qtr.) | 5,946 | 0 | 4.1 | % | 2 | $ | 1,162 |
The Center City submarket contains an overall inventory of 15,417 units, of which 9,471 units or 61% are Class A units. The inventory levels of the overall market and submarket have decreased over the past 8 years due to the large number of condominium conversions which occurred in the early and mid 2000’s. However, the condominium market has cooled off dramatically, which has limited the number of conversions in recent years. In addition, it is unlikely there will be any new construction of multifamily properties in the near future which would directly compete with the subject and comparable properties in the immediate area. Therefore, submarket inventory levels should remain relatively stable over the near future. The Class A properties generally have been renovated or built within the past ten years. The balance of the submarket is comprised of Class B/C properties which are typically older properties which have not been renovated in a number of years. | ||
Within the Center City submarket, there has been very little new apartment construction over the last few years. The vast majority of new residential supply stems from the Condominium market, which could in turn present shadow vacancy in the near term future. However, it should be noted that there has been some new construction of rental housing over the past few years. In 2004, the St. James apartments were completed. This 45-story luxury high-rise building contains 304 units. The Edgewater Apartments and Townhomes were completed in 2006 and contain 290 rental units. Finally, Domus was completed in 2007 and also contains 290 rental units. All three are Class A buildings and all have been received favorably by the market. | ||
Two properties within Center City will add supply to the submarket. The first property is located at 777 South Broad Street. 777 South Broad is planned to contain 146 apartment units consisting of one bedroom and two bedroom unit types along with ground floor retail. The property is currently under construction and scheduled to open in early 2010. However, the property will not be directly competitive with the subject property due to its location. Next, a developer recently converted a vacant building at 15th and Locust Streets to 28 residential units with ground floor retail. The unit mix consists of one bedroom and two bedroom unit types. The units contain high-end luxury finishes and will unlikely directly compete with the subject property. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 37 |
It is unlikely that projects in the planning stage will proceed without commitments for construction financing. There has been talk of various apartment rental properties proposed within the Center City limits. However, most, if not all, of these properties are either on hold or have been cancelled due to the difficult credit markets and challenging economy in today’s market. Considering the difficult economic climate and the tight credit markets for new construction, the impact of these planned projects on the current market is marginal. | ||
Overall submarket vacancy (all classes of properties combined) is estimated at 5.8% as of 2009, which represents a modest increase from a low mark of 4.4% in 2006. Vacancy is expected to increase over the upcoming five year period in the overall submarket. Class A vacancy is higher at 6.9% and also has been moving upward since its low point of 4.5% in 2006. Class B/C vacancy is lower at 4.1% and also has been moving upward since its low point of 3.5% in 2007. | ||
The average effective rent for the overall submarket is $1,558 per unit, which represents an increase from the low mark of $1,197 per unit in 2001. Effective rents have increased an average of 3.6% per year since that time. Effective rental rates are expected to be relatively stagnant through 2010 before growing again in 2011. The Class A asking rental rate is higher at $1,921 per unit and also has been moving upward since its low point of $1,490 per unit in 2000. Class A asking rents have increased an average of 3.0% per year since that time. The Class B/C asking rental rate is lower at $1,162 per unit and also has been moving upward since its low point of $873 per unit in 2000. Class B/C asking rents have increased an average of 3.4% per year since that time. | ||
Condominium Influence | The subject property will likely continue to face competition from the various condominium projects located in the influencing market. However, it is impossible to quantify the affect the unsold condominium inventory will have on the subject property. There remains a renewed interest in urban living and specifically demand for condominium units in Philadelphia fueled in part by changing demographics and relatively low interest rates. The following is a summary of condominium developments within the City Center District. |
CITY CENTER
CONDOMINIUM OVERVIEW
CONDOMINIUM OVERVIEW
Units | Share | |||||||
Total Units | 2,950 | 100.0 | % | |||||
Sold | 1,924 | 65.2 | % | |||||
Under Contract | 150 | 5.1 | % | |||||
Rented | 108 | 3.7 | % | |||||
Vacant/Available | 709 | 24.0 | % |
Between 2003 and October 2009, 65% of the 2,950 new units developed during this period have been sold, 5% are under contract and 4% have been rented, leaving an unsold inventory of 709 units. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 38 |
The average number of new and converted condo units that came onto the market within the CCD boundaries each year from 2003 to 2008 was 227 units, putting the current vacant supply at 2.5 years worth of inventory. 72.6% of the unsold units (515) are concentrated in just a handful of buildings that came late to the market. Many had willing buyers who were unable to close either because they could not sell an existing home or they tried to close at precisely the time that jumbo mortgages became more expensive and very difficult to obtain. | ||
Most importantly, this new inventory of 2,950 condominium units added in the last six years, represents just 15% of the total supply of owner occupied units within the CCD. Condos in existing buildings in and adjacent to the CCD are continuing to sell, but more slowly and at prices 20% to 30% below the market peak, or roughly at 2005 prices. | ||
Conclusion | The Philadelphia apartment market has realized a great deal of new construction in the face of decreased demand resulting from weakness in the local economy. Most of the new units in the delivery pipeline were planned and started prior to the recession that has taken a grip on the economy. As a result of the level of new construction and continued weakness in the economy, the level of new supply is anticipated to exceed demand. This will likely lead to weakness in the operating performance of area apartment properties. | |
The subject’s submarket operates at a slightly higher level of occupancy and rent than the overall Philadelphia area. With proximity to the core business area of the region, apartments in the City Center submarket are in a greater level of demand than the typical apartment in the Philadelphia area. As no substantial increases in inventory is anticipated for the subject submarket, demand is anticipated to be tied to overall economic conditions and moderate declines in occupancy are anticipated. As occupancy levels are expected to decline slightly, concessions will continue to be offered in an effort to bolster occupancy at area apartments. Market conditions in the subject’s submarket are not anticipated to show improvement until overall economic conditions begin to improve and job growth resumes. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 39 |
COMMERCIAL MARKET ANALYSIS | ||
Office Market Overview | The Philadelphia office market is comprised of approximately 144.4 million square feet of space and the subject City Center submarket comprises approximately 30% of the inventory. | |
The following table is a summary of average vacancy and rental rates for the submarkets that comprise the metropolitan Philadelphia office market. It should be noted that the data includes Class A, B, and C office buildings. The subject property is located in the City Center submarket which ranks 2nd in lowest vacancy and 4th in highest effective rents. |
PHILADELPHIA OFFICE MARKET SUMMARY
Vacancy | Prior Year | Effective | Change From | |||||||||||||
Submarket | Rate | Vacancy | Rent/SF | Prior Year | ||||||||||||
West Philadelphia | 7.4 | % | 6.8 | % | $ | 24.18 | -2.9 | % | ||||||||
Center City | 9.3 | % | 8.3 | % | $ | 20.85 | -3.1 | % | ||||||||
NE Philadelphia | 9.5 | % | 9.0 | % | $ | 17.97 | 4.2 | % | ||||||||
Lower Merion | 10.8 | % | 9.4 | % | $ | 24.50 | -1.7 | % | ||||||||
N. Montgomery | 12.6 | % | 13.5 | % | $ | 16.23 | -6.9 | % | ||||||||
Delaware County | 13.2 | % | 12.4 | % | $ | 21.70 | -0.2 | % | ||||||||
Exton/Malvern/N. Chester | 13.3 | % | 12.8 | % | $ | 17.88 | -4.3 | % | ||||||||
S. Chester | 13.8 | % | 12.2 | % | $ | 20.67 | -2.7 | % | ||||||||
Camden/Gloucester | 14.7 | % | 14.0 | % | $ | 17.12 | -2.9 | % | ||||||||
Burlington | 16.6 | % | 16.0 | % | $ | 16.53 | -8.4 | % | ||||||||
King of Prussia | 17.1 | % | 17.2 | % | $ | 19.13 | -1.9 | % | ||||||||
Jenkintown | 18.7 | % | 15.2 | % | $ | 16.94 | -3.7 | % | ||||||||
Bucks County | 20.8 | % | 16.6 | % | $ | 18.91 | -0.2 | % | ||||||||
Blue Bell/Plymouth | 21.9 | % | 20.7 | % | $ | 19.01 | -2.1 | % | ||||||||
Horsham | 24.1 | % | 21.5 | % | $ | 15.94 | -7.4 | % |
Rents: In 2009, asking rents have gained 0.4% to $24.13 per square foot. Effective rents have fallen 3.4% this year to $19.64 per square foot, including a 0.5% decrease in the third quarter, as owners are ramping up concessions to limit vacancy rises. In the Center City submarket, asking rents pushed up 0.3% year to date to $25.78 per square foot in the third quarter, while effective rents dropped 3.5% to $20.94 per square foot. Further concession increases are expected as owners look to keep vacancy in the area below 10%. In 2010, metro-wide asking rents are expected to fall, while effective rents are projected to recede as well. Owners will continue to increase concessions over the next few quarters in an effort to counter rising vacancy rates. | ||
Vacancy: Ongoing additions to office inventory, along with soft tenant demand, raised the market wide vacancy rate 140 basis points in the third quarter to 13.2%. In the Class A property segment, negative net absorption of 820,000 square feet has been posted over the last 12 months, lifting the vacancy rate 130 basis points to 12.5%. Year to date, 440,000 square feet of top-tier space has been returned to the market. The vacancy rate in Class B/C properties rose 100 basis points in the third quarter 2009 to 13.8% on negative net absorption of 160,000 square feet. Year over year, lower-tier vacancy has climbed 140 basis points. Vacancy is forecast to reach 13.7% at year end 2009, a 160 basis point increase from 2008, when the average rate rose 80 basis points. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 40 |
Construction: The inventory of competitive for-lease office space in Philadelphia expanded by just 0.3%, or about 400,000 square feet, during the 12 months ending third quarter 2009. In the previous year, approximately 2.6 million square feet was added. Nearly 250,000 square feet of office space is under way in the local market, and another 18 million square feet is planned. The Bucks County submarket is estimated to have received more than one-third of the stock. After additions of about 250,000 square feet of condo space last year, for sale office completions has slowed considerably. Almost 500,000 square feet of new office space is expected to come online in the Philadelphia market in 2009, after approximately 1.7 million square feet was delivered in 2008. | ||
Sales: Transaction velocity in Philadelphia has declined 30% during the past 12 months. Since the beginning of the year, velocity has dropped nearly 60% from the corresponding period in 2008. Activity remains subdued as a result of investors’ expectations for weaker near-term fundamentals. Office properties have sold for a median price of $133 per square foot over the last year, a decrease of 8%. Buyers underwriting for higher vacancy rates and greater concessions are pushing down prices. Cap rates for properties sold over the past 12 months averaged in the high 7% to high 8% range, up about 75 basis points to 100 basis points. Sales activity is expected to increase modestly in 2010 as more distressed assets reach the market. Through year-end 2009, however, a persistent expectations gap will continue to restrain velocity. | ||
Conclusion: In Philadelphia, office property conditions are expected to stabilize through the second half of 2009, supported by a slowdown in both office-using employment losses and supply additions. These trends will be most apparent in Center City, the metro’s largest submarket, softening the drop in tenant demand. Additionally, nearly half of the 400,000 square feet of negative net absorption expected in Center City this year is forecast to be recorded during the last few months of the year. As such, vacancy is forecast to settle in the low to mid 9% range by year end, still one of the lowest rates in the metro. Close-in locations, including Center City, are expected to continue to perform better than the overall market due to negligible supply-side threats and steady demand. The West Philadelphia and Northeast Philadelphia submarkets, for instance, also will post only modest increases in vacancy during the second half, keeping the average rates in each of these areas below 10% and allowing the annual decline in effective rents to stay under 4%. | ||
Transaction activity in the local office market is expected to remain light through year end due to investors’ expectations for softer near-term operations and a persistent buyer/seller expectations gap. Velocity has slowed by about 50% over the last two quarters compared to the same period in 2008, with activity now near levels last recorded in the second half of 2001 and early 2002. Cap rates continue to push higher as investors account for greater perceived risk. Initial yields currently average in the mid to high 8% range, up about 100 basis points year over year. Over the next few quarters, investors are expected to target top-tier properties with strong leases in place in an attempt to mitigate short-term |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 41 |
risk. Owners seeking to exit the market should consider selling, as current market conditions will likely warrant pricing discounts in the near term, given projections for moderating revenues. | ||
Retail Market Overview | In 2009, accelerating job losses, combined with ongoing inventory growth, pushed the retail vacancy rate in Philadelphia to the highest level in more than six years. Staff reductions within the professional and business services sector in particular continue to weigh on overall employment. Retail sales are expected to decline as a result, contributing to negative net absorption of more than 5 million square of retail space. | |
On the supply side, projects started during the most recent period of economic stability now are coming online, which will increase local retail stock by an estimated 0.5%. The added competition from both new space and vacant, product is pushing owners to expand concessions, which are expected to account for 11% of asking rents, an increase of 140 basis points from the end of 2008 and the highest rate ever offered within the metro. | ||
Current market-wide asking rents of $19.69 per square foot are 2.2% lower than asking rents in the second quarter of 2008 and are down 3.9% year to date. In the first two quarters of 2008, asking rents rose 1%. Effective rents were $17.61 per square foot in the second quarter of 2009, a decline of 3.3% year over year and 2.6% year to date. Concessions remain high peaking at 9% of asking rents in some submarkets. Increases to vacancy and minimal effective rent growth have caused metro-wide revenues to decrease 5.5% during the last year. Weak retail space demand will continue to suppress rents. | ||
City Center Retail | Despite a national recession, Center City Philadelphia’s retail market has shown remarkable resiliency. In the 12-month period ending August 2009, 92 new restaurant and food related businesses opened downtown along with 187 other new retail businesses. While difficulties in securing financing have delayed many projects, local entrepreneurs and several national chains have continued to add to the supply of retail establishments downtown, using such internal resources as funding from friends and family, cash-flow from operations at other locations and traditional commercial loans. Despite the most severe national recession in recent memory and declining sales in some sectors, retail vacancy inched up by only one-half of 1% in the last year. | |
The diversification of the downtown has provided multiple sources of retail demand both during the day and evening hours, with 200,000 office workers occupying 35 million square feet of commercial space and a strong convention and tourism industry filling 10,000 hotel rooms. Center City’s emergence as the third largest residential downtown in the United States, with an extraordinary concentration of well-educated and professionally employed residents, has created an entirely new source of demand for household goods, personal and professional services, as well as food and dining. Finally, Center City’s core strength as a dense, compact and walk able downtown provides an high concentration of |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 42 |
retail demand. The following tables summarize retail demand by segment for the City Center area. The data is based on a radius study with the center point being City Hall (JFK Boulevard at Broad Street). The subject property is included within the one-half mile radius data. |
RETAIL DEMAND BY SEGMENT
Quarter-Mile Radius | Half-Mile Radius | One-Mile Radius | ||||||||||
Worker Market | ||||||||||||
Office SF | 11,506,247 | 25,643,563 | 36,270,370 | |||||||||
Office Workers | 51,202 | 114,113 | 161,402 | |||||||||
Non-Office Workers | 15,776 | 35,160 | 49,730 | |||||||||
Total Office Workers | 66,978 | 149,273 | 221,132 | |||||||||
Residential Market | ||||||||||||
Owners | 6,610 | 18,107 | 49,369 | |||||||||
Renters | 4,872 | 14,080 | 33,300 | |||||||||
Total Population | 11,482 | 32,187 | 82,669 | |||||||||
Visitor Market | ||||||||||||
Hotel Rooms | 32,223 | 7,316 | 8,111 | |||||||||
Visitors | 415,542 | 943,254 | 1,005,725 | |||||||||
Dollars of Demand for Shoppers Goods | ||||||||||||
Office Workers | $ | 54,479,000 | $ | 121,416,000 | $ | 171,732,000 | ||||||
Non-Office Workers | $ | 8,345,000 | $ | 18,599,000 | $ | 26,307,000 | ||||||
Residents | $ | 22,045,000 | $ | 61,799,000 | $ | 158,724,000 | ||||||
Overnight Visitors | $ | 65,683,000 | $ | 126,396,000 | $ | 1,347,467,000 | ||||||
Total | $ | 150,552,000 | $ | 328,210,000 | $ | 491,530,000 |
Despite a difficult economy, retail within the City Center area has fared well compared to other submarkets of Philadelphia. Among the residents of the district, is a steadily increasing population of highly educated individuals with overall household incomes that generate significant consumer spending. In the core of the downtown, over 40% of residents walk to work, while in the next ring out, residents commute primarily by public transit. Few Center City households thus have more than one car, and many have no car, eliminating a large annual expense that can be devoted to other expenditures, making the residents of Center City an even more attractive market than a casual glimpse of demographic indicators may suggest. Driving the local retail market is a Center City population of 159,300 residents or 82,7000 households, having an average age of 39.9 years. This highly educated population has an average household income of $74,317 and an annual aggregate income of $4.9 billion. Adding in the purchasing power of nearly 90,000 students who attend college in or adjacent to Center City, makes the area attractive for a variety of retail services. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 43 |
APARTMENT MARKET RENT ANALYSIS
Subject Property Leasing | A December 2009 Rent Roll was provided for the subject. The current asking rents are summarized in the following table. |
SUBJECT CURRENT ASKING RENT SUMMARY
Unit | Floor | Total | Asking Rent | Asking Rent | ||||||||||||||||||||||||
Type | Plan | Mix | Size (SF) | Area | Occupancy | Per Unit | Per SF | |||||||||||||||||||||
Studio | EA10 | 1 | 390 | 390 | 0 | % | $ | 1,139 | $ | 2.921 | ||||||||||||||||||
Studio | EB10 | 10 | 410 | 4,100 | 100 | % | $ | 929 | $ | 2.266 | ||||||||||||||||||
Studio | EC10 | 20 | 430 | 8,600 | 95 | % | $ | 899 | $ | 2.091 | ||||||||||||||||||
Studio | ED10 | 125 | 460 | 57,500 | 99 | % | $ | 979 to $1,024 | $ | 2.213 to $2.226 | ||||||||||||||||||
Studio | EE10 | 5 | 520 | 2,600 | 100 | % | $ | 999 | $ | 1.921 | ||||||||||||||||||
Studio | EF10 | 2 | 640 | 1,280 | 100 | % | $ | 1,699 to $1,719 | $ | 2.655 to $2.686 | ||||||||||||||||||
1BR/1BA | 1A10 | 17 | 550 | 9,350 | 88 | % | $ | 1,372 to $1,437 | $ | 2.495 to $2.613 | ||||||||||||||||||
1BR/1BA | 1B10 | 28 | 800 | 22,400 | 93 | % | $ | 1,372 to $1,522 | $ | 1.715 to $1.903 | ||||||||||||||||||
1BR/1BA | 1C10 | 33 | 870 | 28,710 | 100 | % | $ | 1,579 to $1,594 | $ | 1.815 to $1.832 | ||||||||||||||||||
1BR/1BA | 1D10 | 88 | 950 | 83,600 | 91 | % | $ | 1,499 to $1,579 | $ | 1.578 to $1.662 | ||||||||||||||||||
1BR/1BA | 1E10 | 16 | 970 | 15,520 | 94 | % | $ | 1,579 to $1,629 | $ | 1.628 to $1.679 | ||||||||||||||||||
1BR/1BA | 1F10 | 3 | 1,000 | 3,000 | 100 | % | $ | 1,604 to $1,614 | $ | 1.604 to $1.614 | ||||||||||||||||||
2BR/2BA | 2A20 | 33 | 1,200 | 39,600 | 94 | % | $ | 1,799 to $1,809 | $ | 1.499 to $1.508 | ||||||||||||||||||
2BR/2BA | 2B20 | 13 | 1,290 | 16,770 | 100 | % | $ | 1,849 to $1,874 | $ | 1.433 to $1.453 | ||||||||||||||||||
2BR/2BA | 2C20 | 2 | 1,350 | 2,700 | 100 | % | $ | 1,934 | $ | 1.433 | ||||||||||||||||||
2BR/2BA | 2D20 | 71 | 1,420 | 100,820 | 94 | % | $ | 1,949 to $2,014 | $ | 1.373 to $1.418 | ||||||||||||||||||
2BR/2BA | 2E20 | 3 | 1,590 | 4,770 | 100 | % | $ | 2,234 to $2,299 | $ | 1.405 to $1.446 | ||||||||||||||||||
2BR/2BA | 2F20 | 28 | 1,790 | 50,120 | 93 | % | $ | 2,179 to $2,289 | $ | 1.217 to $1.279 | ||||||||||||||||||
3BR/2BA | 3A20 | 11 | 1,550 | 17,050 | 91 | % | $ | 2,408 to $2,458 | $ | 1.554 to $1.586 | ||||||||||||||||||
3BR/2BA | 3B20 | 11 | 1,650 | 18,150 | 91 | % | $ | 2,459 to $2,469 | $ | 1.490 to $1.496 | ||||||||||||||||||
3BR/2BA | 3C20 | 7 | 1,900 | 13,300 | 86 | % | $ | 2,624 to $2,644 | $ | 1.381 to $1.392 | ||||||||||||||||||
3BR/2BA | 3G20 | 5 | 2,060 | 10,300 | 80 | % | $ | 2,829 to $2,849 | $ | 1.373 to $1.383 | ||||||||||||||||||
3BR/2BA | 3D20 | 1 | 2,140 | 2,140 | 100 | % | $ | 3,199 | $ | 1.495 | ||||||||||||||||||
3BR/2BA | 3E20 | 1 | 2,370 | 2,370 | 100 | % | $ | 3,819 | $ | 1.611 | ||||||||||||||||||
4BR/2BA | 4A30 | 1 | 2,350 | 2,350 | 100 | % | $ | 3,979 | $ | 1.693 | ||||||||||||||||||
Totals/Average | 535 | 967 | 517,490 | 95 | % |
Competitive Set | In order to determine the market rent for the subject’s apartment units, a survey of comparable apartment complexes considered most similar to the subject was conducted. The subject competes with a limited number of properties in the area. All of the properties are in close proximity to the subject and represent similar Class A high-rise residential developments located within or near the City Center district. The information regarding the rent comparables was obtained through physical inspections and direct interviews of rental agents and property managers. The following map illustrates the location of the comparable properties in relation to the subject. Data sheets summarizing details of the subject and comparable properties follow the map. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 44 |
COMPARABLE RENTAL MAP
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597911.gif)
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 45 |
SUBJECT PROPERTY | The Sterling | |
1815 JFK Boulevard | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 535 | |
Year Built | 1961/renovated 1998 | |
Occupancy | 95% | |
Amenities | Electric kitchen appliances, in-suite washer/dryer, walk-in closets (select units), balconies, and built-in bookcases. Complex is a Class A high-rise property with standard amenities including controlled access, fitness center, roof-top swimming pool, 24-hour attended lobby, on-site retail, and covered parking. | |
Concessions | Prices change often and rents for individual floor plans are reduced as needed to help bolster occupancy. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 46 |
RENTAL DATA
Unit | Floor | Total | Asking Rent | Asking Rent | ||||||||||||||||||||||||
Type | Plan | Mix | Size (SF) | Area | Occupancy | Per Unit | Per SF | |||||||||||||||||||||
Studio | EA10 | 1 | 390 | 390 | 0 | % | $ | 1,139 | $ | 2.921 | ||||||||||||||||||
Studio | EB10 | 10 | 410 | 4,100 | 100 | % | $ | 929 | $ | 2.266 | ||||||||||||||||||
Studio | EC10 | 20 | 430 | 8,600 | 95 | % | $ | 899 | $ | 2.091 | ||||||||||||||||||
Studio | ED10 | 125 | 460 | 57,500 | 99 | % | $ | 979 to $1,024 | $2.213 to $2.226 | |||||||||||||||||||
Studio | EE10 | 5 | 520 | 2,600 | 100 | % | $ | 999 | $ | 1.921 | ||||||||||||||||||
Studio | EF10 | 2 | 640 | 1,280 | 100 | % | $ | 1,699 to $1,719 | $ | 2.655 to $2.686 | ||||||||||||||||||
1BR/1BA | 1A10 | 17 | 550 | 9,350 | 88 | % | $ | 1,372 to $1,437 | $ | 2.495 to $2.613 | ||||||||||||||||||
1BR/1BA | 1B10 | 28 | 800 | 22,400 | 93 | % | $ | 1,372 to $1,522 | $ | 1.715 to $1.903 | ||||||||||||||||||
1BR/1BA | 1C10 | 33 | 870 | 28,710 | 100 | % | $ | 1,579 to $1,594 | $ | 1.815 to $1.832 | ||||||||||||||||||
1BR/1BA | 1D10 | 88 | 950 | 83,600 | 91 | % | $ | 1,499 to $1,579 | $ | 1.578 to $1.662 | ||||||||||||||||||
1BR/1BA | 1E10 | 16 | 970 | 15,520 | 94 | % | $ | 1,579 to $1,629 | $ | 1.628 to $1.679 | ||||||||||||||||||
1BR/1BA | 1F10 | 3 | 1,000 | 3,000 | 100 | % | $ | 1,604 to $1,614 | $ | 1.604 to $1.614 | ||||||||||||||||||
2BR/2BA | 2A20 | 33 | 1,200 | 39,600 | 94 | % | $ | 1,799 to $1,809 | $ | 1.499 to $1.508 | ||||||||||||||||||
2BR/2BA | 2B20 | 13 | 1,290 | 16,770 | 100 | % | $ | 1,849 to $1,874 | $ | 1.433 to $1.453 | ||||||||||||||||||
2BR/2BA | 2C20 | 2 | 1,350 | 2,700 | 100 | % | $ | 1,934 | $ | 1.433 | ||||||||||||||||||
2BR/2BA | 2D20 | 71 | 1,420 | 100,820 | 94 | % | $ | 1,949 to $2,014 | $ | 1.373 to $1.418 | ||||||||||||||||||
2BR/2BA | 2E20 | 3 | 1,590 | 4,770 | 100 | % | $ | 2,234 to $2,299 | $ | 1.405 to $1.446 | ||||||||||||||||||
2BR/2BA | 2F20 | 28 | 1,790 | 50,120 | 93 | % | $ | 2,179 to $2,289 | $ | 1.217 to $1.279 | ||||||||||||||||||
3BR/2BA | 3A20 | 11 | 1,550 | 17,050 | 91 | % | $ | 2,408 to $2,458 | $ | 1.554 to $1.586 | ||||||||||||||||||
3BR/2BA | 3B20 | 11 | 1,650 | 18,150 | 91 | % | $ | 2,459 to $2,469 | $ | 1.490 to $1.496 | ||||||||||||||||||
3BR/2BA | 3C20 | 7 | 1,900 | 13,300 | 86 | % | $ | 2,624 to $2,644 | $ | 1.381 to $1.392 | ||||||||||||||||||
3BR/2BA | 3G20 | 5 | 2,060 | 10,300 | 80 | % | $ | 2,829 to $2,849 | $ | 1.373 to $1.383 | ||||||||||||||||||
3BR/2BA | 3D20 | 1 | 2,140 | 2,140 | 100 | % | $ | 3,199 | $ | 1.495 | ||||||||||||||||||
3BR/2BA | 3E20 | 1 | 2,370 | 2,370 | 100 | % | $ | 3,819 | $ | 1.611 | ||||||||||||||||||
4BR/2BA | 4A30 | 1 | 2,350 | 2,350 | 100 | % | $ | 3,979 | $ | 1.693 | ||||||||||||||||||
Totals/Average | 535 | 967 | 517,490 | 95 | % |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 47 |
COMPARABLE RENTAL 1 | Museum Tower | |
1801 Buttonwood Street | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 286 | |
Year Built | 1989/renovated 2008 | |
Occupancy | 97% | |
Amenities | Electric kitchen appliances including microwave oven (in select units), in-suite washer/dryer, walk-in closets (select units), balconies, and built-in bookcases. Complex is a Class A high-rise property with standard amenities including controlled access, fitness center, 24-hour attended lobby, on-site retail, and covered parking. | |
Concessions | Reduced rents on individual floor plans when determined appropriate by management. |
RENTAL DATA
Unit | Size Range | Average | Rent | Average | Average | |||||||||||||||||||
Type | Count | (SF) | Size/SF | Range | Rent | Rent/SF | ||||||||||||||||||
Studios | 56 | 530 to 610 | 570 | $ | 1,041 to $1,209 | $ | 1,125 | $ | 1.97 | |||||||||||||||
1BR/1BA | 144 | 768 to 804 | 787 | $ | 1,210 to $1,456 | $ | 1,333 | $ | 1.69 | |||||||||||||||
2BR/1BA | 30 | 1,050 to 1,050 | 1,050 | $ | 1,510 to $1,820 | $ | 1,665 | $ | 1.59 | |||||||||||||||
2BR/2BA | 56 | 1,160 to 1,250 | 1,205 | $ | 1,605 to $1,910 | $ | 1,758 | $ | 1.46 | |||||||||||||||
Total/Avg. | 286 | 1,070 | $ | 1,410 | $ | 1.32 | ||||||||||||||||||
Occupancy | 97 | % |
Comments | The property is located approximately1/4-mile north of The Sterling. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 48 |
COMPARABLE RENTAL 2 | One Franklin Town | |
One Franklin Town Boulevard | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 334 | |
Year Built | 1982/renovated 2005-2009 | |
Occupancy | 96% | |
Amenities | Electric kitchen appliances including microwave oven (in select units), in-suite washer/dryer, walk-in closets (select units), balconies, and built-in bookcases. Complex is a Class A high-rise property with standard amenities including controlled access, fitness center, indoor swimming pool, 24-hour attended lobby, on-site retail, and covered parking. | |
Concessions | Prices change often and rents for individual floor plans are reduced as needed to help bolster occupancy. |
RENTAL DATA
Unit | Size Range | Average | Rent | Average | Average | |||||||||||||||||||
Type | Count | (SF) | Size/SF | Range | Rent | Rent/SF | ||||||||||||||||||
Studios | 2 | 315 to 315 | 315 | $1,139 | $ | 1,139 | $ | 3.62 | ||||||||||||||||
1BR/1BA | 180 | 805 to 850 | 828 | $1,125 to $1,600 | $ | 1,363 | $ | 1.65 | ||||||||||||||||
2BR/1BA | 17 | 950 to 950 | 950 | $1,400 to $1,990 | $ | 1,695 | $ | 1.78 | ||||||||||||||||
2BR/2BA | 134 | 1,165 to 1,200 | 1,183 | $1,545 to $2,000 | $ | 1,773 | $ | 1.50 | ||||||||||||||||
3BR/2BA | 1 | 1,600 to 1,600 | 1,600 | $2,399 to $2,399 | $ | 2,399 | $ | 1.50 | ||||||||||||||||
Total/Avg. | 334 | 978 | $ | 1,546 | $ | 1.58 | ||||||||||||||||||
Occupancy | 96 | % |
Comments | Property is located1/4-mile north of the subject property. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 49 |
COMPARABLE RENTAL 3 | Lofts at 1835 Arch | |
1835 Arch Street | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 191 | |
Year Built | 1924/renovated 2001 | |
Occupancy | 97% | |
Amenities | Electric kitchen appliances including microwave oven (in select units), in-suite washer/dryer, walk-in closets (select units), terraces, and broadband internet access. Complex is a Class A high-rise property with standard amenities including controlled access, fitness center, business center, attended lobby, and covered parking. | |
Concessions | Rents for individual floor plans are reduced as needed to help bolster occupancy. No application fees. |
RENTAL DATA
Unit | Size Range | Average | Rent | Average | Average | |||||||||||||||||||
Type | Count | (SF) | Size/SF | Range | Rent | Rent/SF | ||||||||||||||||||
1BR/1BA | 140 | 615 to 1,030 | 823 | $1,280 to $1,912 | $ | 1,596 | $ | 1.94 | ||||||||||||||||
2BR/2BA | 51 | 1,155 to 1,410 | 1,283 | $1,999 to $2,434 | $ | 2,217 | $ | 1.73 | ||||||||||||||||
Total/Avg. | 191 | 949 | $ | 1,762 | $ | 1.86 | ||||||||||||||||||
Occupancy | 97 | % |
Comments | Property is located two blocks north of the subject property. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 50 |
COMPARABLE RENTAL 4 | 1500 Locust | |
1500 Locust Street | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 610 | |
Year Built | 1973/renovated 2008 | |
Occupancy | 94% | |
Amenities | Electric kitchen appliances including microwave oven (in select units), in-suite washer/dryer, walk-in closets (select units), private balconies, and broadband internet access. Complex is a Class A high-rise property with standard amenities including controlled access, fitness center, roof top swimming pool, 24-hour attended lobby, and on-site parking. | |
Concessions | Rents for individual floor plans are reduced as needed to help bolster occupancy. |
RENTAL DATA
Unit | Size Range | Average | Rent | Average | Average | |||||||||||||||||||
Type | Count | (SF) | Size/SF | Range | Rent | Rent/SF | ||||||||||||||||||
Studios | 61 | 497 to 497 | 497 | $ | 1,285 to $1,455 | $ | 1,370 | $ | 2.76 | |||||||||||||||
1BR/1BA | 427 | 745 to 911 | 829 | $ | 1,515 to $2,590 | $ | 2,053 | $ | 2.48 | |||||||||||||||
2BR/2BA | 122 | 1,113 to 1,264 | 1,189 | $ | 2,315 to $3,480 | $ | 2,898 | $ | 2.44 | |||||||||||||||
Total/Avg. | 610 | 881 | $ | 2,154 | $ | 2.44 | ||||||||||||||||||
Occupancy | 94 | % |
Comments | Property is located1/4-mile south of the subject property. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 51 |
COMPARABLE RENTAL 5 | Edgewater | |
2323 Race Street | ||
Philadelphia, Pennsylvania |
![]() | ||
Units | 290 | |
Year Built | 2006 | |
Occupancy | 96% | |
Amenities | Electric kitchen appliances including microwave oven (in select units), in-suite washer/dryer, walk-in closets (select units), and broadband internet access. Complex is a Class A high-rise property with standard amenities including controlled access, clubroom, business and fitness center, 24-hour attended lobby, one-acre riverfront park, and garage parking. | |
Concessions | Rents for individual floor plans are reduced as needed to help bolster occupancy. |
RENTAL DATA
Unit | Size Range | Average | Rent | Average | Average | |||||||||||||||||||
Type | Count | (SF) | Size/SF | Range | Rent | Rent/SF | ||||||||||||||||||
Studios | 22 | 610 to 610 | 610 | $ | 1,350 to $1,595 | $ | 1,473 | $ | 2.41 | |||||||||||||||
1BR/1BA | 122 | 794 to 1,070 | 932 | $ | 1,670 to $2,070 | $ | 1,870 | $ | 2.01 | |||||||||||||||
2BR/2BA | 128 | 1,160 to 1,209 | 1,185 | $ | 2,145 to $2,790 | $ | 2,468 | $ | 2.08 | |||||||||||||||
3BR/2BA | 18 | 1,579 to 1,579 | 1,579 | $ | 3,245 to $3,525 | $ | 3,385 | $ | 2.14 | |||||||||||||||
Total/Avg. | 290 | 1,049 | $ | 2,198 | $ | 2.10 | ||||||||||||||||||
Occupancy | 96 | % |
Comments | Property is located1/4-mile west of the subject property. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 52 |
ANALYSIS | The comparable rental properties are all in the immediate vicinity of the subject property and were built between 1924 and 2006; many of the older properties, including the subject have been renovated over time. In general the comparable set is considered similar to the subject with respect to location, physical characteristics, appeal, and tenant amenities. The comparables have unit and complex amenities similar to the subject. The rental rates illustrated by the comparable properties provide a good indication as to the appropriate market rent of the subject property. | |
Studio | The subject property offers six (6) studio floor plans that range in size from 390 to 640 square feet. The rental rates for the subject units under analysis range from $899 to $1,719 per month, or $1.92 to $2.92 per square foot. The following chart outlines rental rates for similar sized one bedroom floor plans within the competing apartment properties. |
STUDIO FLOOR PLANS
Comparable # | Unit Size (SF) | Rent/Month | Rent/SF | Comment | ||||
Subject | 390 | $1,139 | $2.92 | Subject | ||||
Subject | 410 | $929 | $2.27 | Subject | ||||
Subject | 430 | $899 | $2.09 | Subject | ||||
Subject | 460 | $979 to $1,024 | $2.13 to $2.23 | Subject | ||||
Subject | 520 | $999 | $1.92 | Subject | ||||
Subject | 640 | $1,699 to $1,719 | $2.66 to $2.69 | Subject | ||||
Museum Towers | 530 to 610 | $1,041 to $1,209 | $1.96 - $1.98 | Similar | ||||
One Franklin Town | 315 | $1,139 | $3.62 | Similar | ||||
1500 Locust | 497 | $1,285 to $1,455 | $2.59 - $2.93 | Similar | ||||
Edgewater | 610 | $1,350 to $1,595 | $2.21 to $2.62 | Similar | ||||
Subject Range | 390 - 640 | $899 - $1,719 | $1.92 - $2.92 | |||||
Comparable Range | 315 - 610 | $1,041 - $1,595 | $1.96 - $3.62 | |||||
The rents for comparable studio floor plans range from $1,041 to $1,595 per unit and $1.96 to $3.62 per square foot. The comparable properties are all similar to the subject in terms of location and physical characteristics. After considering variances for unit size and amenities offered, the subject’s quoted rent structure is well within the comparable range. The subject’s quoted rent structure appears well supported. | ||
One-Bedroom Units | The subject property offers six (6) one-bedroom floor plans that range in size from 550 to 1,000 square feet. The rental rates for the subject units under analysis range from $1,372 to $1,629 per month, or $1.60 to $2.61 per square foot. The following chart outlines rental rates for similar sized one-bedroom floor plans within the competing apartment properties. |
ONE-BEDROOM FLOOR PLANS
Comparable # | Unit Size (SF) | Rent/Month | Rent/SF | Comment | ||||
Subject | 550 | $1,372 to $1,437 | $2.50 to $2.61 | Subject | ||||
Subject | 800 | $1,372 to $1,522 | $1.72 to $1.90 | Subject | ||||
Subject | 870 | $1,579 to $1,594 | $1.82 to $1.83 | Subject | ||||
Subject | 950 | $1,499 to $1,579 | $1.58 to $1.66 | Subject | ||||
Subject | 970 | $1,579 to $1,629 | $1.63 to $1.68 | Subject | ||||
Subject | 1,000 | $1,604 to $1,614 | $1.60 to $1.61 | Subject | ||||
Museum Towers | 768 to 804 | $1,210 to $1,456 | $1.58 to $1.81 | Similar | ||||
One Franklin Town | 805 to 850 | $1,125 to $1,600 | $1.40 to $1.88 | Similar | ||||
Lofts at 1835 Arch | 615 to 1,030 | $1,280 to $1,912 | $1.86 to $2.05 | Similar | ||||
1500 Locust | 745 to 911 | $1,515 to $2,590 | $2.03 to $2.84 | Similar | ||||
Edgewater | 794 to 1,070 | $1,670 to $2,070 | $1.93 to $2.10 | Similar | ||||
Subject Range | 550 - 1,000 | $1,372 - $1,629 | $1.60 - $2.61 | |||||
Comparable Range | 615 - 1,070 | $1,125 - $2,590 | $1.40 - $2.84 | |||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 53 |
The rents for comparable one-bedroom floor plans range from $1,125 to $2,590 per unit and $1.40 to $2.84 per square foot. The comparable properties are all similar to the subject in terms of location and physical characteristics. The subject’s rent structure is bracketed by the rents exhibited by competing properties in the influencing market area. After considering variances for unit size and amenities offered, the subject’s quoted rent structure is well within the comparable range. The subject’s quoted rent structure appears well supported. | ||
Two-Bedroom Units | The subject property offers six (6) two-bedroom floor plans that range in size from 1,200 to 1,790 square feet. The rental rates for the subject’s two-bedroom units under analysis range from $1,799 to $2,299 per month, or $1.22 to $1.51 per square foot. The comparable two-bedroom units range in size from 1,113 to 1,410 square feet and have monthly asking rents ranging from $1,545 to $3,480 or $1.33 to $2.75 per square foot. |
TWO-BEDROOM FLOOR PLANS
Comparable # | Unit Size (SF) | Rent/Month | Rent/SF | Comment | ||||
Subject | 1,200 | $1,799 to $1,809 | $1.50 to $1.51 | Subject | ||||
Subject | 1,290 | $1,849 to $1,874 | $1.43 to $1.45 | Subject | ||||
Subject | 1,350 | $1,934 | $1.43 | Subject | ||||
Subject | 1,420 | $1,949 to $2,014 | $1.37 to $1.42 | Subject | ||||
Subject | 1,590 | $2,234 to $2,299 | $1.41 to $1.46 | Subject | ||||
Subject | 1,790 | $2,179 to $2,289 | $1.22 to $1.28 | Subject | ||||
Museum Towers | 1,160 to 1,250 | $1,605 to $1,910 | $1.38 to $1.53 | Similar | ||||
One Franklin Town | 1,165 to 1,200 | $1,545 to $2,000 | $1.33 to $1.67 | Similar | ||||
Lofts at 1835 Arch | 1,155 to 1,410 | $1,999 to $2,434 | $1.73 | Similar | ||||
1500 Locust | 1,113 to 1,264 | $2,315 to $3,480 | $2.08 to $2.75 | Similar | ||||
Edgewater | 1,160 to 1,209 | $2,145 to $2,790 | $1.85 to $2.31 | Similar | ||||
Subject Range | 1,200 - 1,790 | $1,799 - $2,299 | $1.22 - $1.51 | |||||
Comparable Range | 1,113 - 1,410 | $1,545 - $3,480 | $1.33 - $2.75 | |||||
After considering variances for unit size and amenity package, the subject’s quoted rent structure is well within the comparable range. The subject’s rent structure for the two-bedroom floor plans is well supported. | ||
Three-Bedroom Units | The subject property offers six (6) three-bedroom floor plans that range in size from 1,550 to 2,370 square feet. The rental rates for the subject’s three-bedroom units under analysis range from $2,408 to $3,819 per month, or $1.37 to $1.61 per square foot. Only two comparable properties offer a three-bedroom floor plan. The comparable three-bedroom units range in size from 1,579 to 1,600 square feet and have monthly asking rents ranging from $2,399 to $3,525 or $1.50 to $2.23 per square foot. |
THREE-BEDROOM FLOOR PLANS
Comparable # | Unit Size (SF) | Rent/Month | Rent/SF | Comment | ||||
Subject | 1,550 | $2,408 to $2,458 | $1.55 to $1.59 | Subject | ||||
Subject | 1,650 | $2,459 to $2,469 | $1.49 to $1.50 | Subject | ||||
Subject | 1,900 | $2,624 to $2,644 | $1.38 to $1.39 | Subject | ||||
Subject | 2,060 | $2,829 to $2,849 | $1.37 to $1.38 | Subject | ||||
Subject | 2,140 | $3,199 | $1.49 | Subject | ||||
Subject | 2,370 | $3,819 | $1.61 | Subject | ||||
One Franklin Town | 1,600 | $2,399 | $1.50 | Similar | ||||
Edgewater | 1,579 | $3,245 to $3,525 | $2.06 to $2.23 | Similar | ||||
Subject Range | 1,550 - 2,370 | $2,408 - $3,819 | $1.37 - $1.61 | |||||
Comparable Range | 1,579 - 1,600 | $2,399 - $3,525 | $1.50 - $2.23 | |||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 54 |
After considering variances for unit size, the subject’s quoted rent structure is well within the comparable range. The subject’s rent structure for the three-bedroom floor plans is well supported. | ||
Four-Bedroom Units | The subject property offers one (1) four-bedroom floor plan that measures 2,350 square feet. There is only one four-bedroom unit in the subject property. The rental rate for the subject’s four-bedroom unit under analysis is $3,979 per month, or $1.69 per square foot. There are no comparable four-bedroom floor plans, or similarly sized three-bedroom units offered at the competing properties. However, based on the subject’s previously analyzed three-bedroom floor plans, and after considering variances for unit size, the subject’s quoted rent structure is supported by the comparable data. |
FOUR-BEDROOM FLOOR PLANS
Comparable # | Unit Size (SF) | Rent/Month | Rent/SF | |||
Subject | 2,350 | $3,979 | $1.69 |
Conclusions | The subject is expected to continue to capture its fair share of the market at the indicated economic rates. The subject’s potential gross potential rent is summarized in the following chart. |
SUMMARY OF ECONOMIC RENT POTENTIAL
Floor | Size | Total | Economic | Economic | ||||||||||||||||||||||||||||
Unit Type | Plan | Mix | (SF) | Area | Rent | Rent/SF | Monthly Rent | Annual Rent | ||||||||||||||||||||||||
Studio | EA10 | 1 | 390 | 390 | $ | 1,139 | $ | 2.92 | $ | 1,139 | $ | 13,668 | ||||||||||||||||||||
Studio | EB10 | 10 | 410 | 4,100 | $ | 929 | $ | 2.27 | $ | 9,290 | $ | 111,480 | ||||||||||||||||||||
Studio | EC10 | 20 | 430 | 8,600 | $ | 899 | $ | 2.09 | $ | 17,980 | $ | 215,760 | ||||||||||||||||||||
Studio | ED10 | 125 | 460 | 57,500 | $ | 1,002 | $ | 2.18 | $ | 125,250 | $ | 1,503,000 | ||||||||||||||||||||
Studio | EE10 | 5 | 520 | 2,600 | $ | 999 | $ | 1.92 | $ | 4,995 | $ | 59,940 | ||||||||||||||||||||
Studio | EF10 | 2 | 640 | 1,280 | $ | 1,709 | $ | 2.67 | $ | 3,418 | $ | 41,016 | ||||||||||||||||||||
1BR/1BA | 1A10 | �� | 17 | 550 | 9,350 | $ | 1,405 | $ | 2.55 | $ | 23,885 | $ | 286,620 | |||||||||||||||||||
1BR/1BA | 1B10 | 28 | 800 | 22,400 | $ | 1,405 | $ | 1.76 | $ | 39,340 | $ | 472,080 | ||||||||||||||||||||
1BR/1BA | 1C10 | 33 | 870 | 28,710 | $ | 1,586 | $ | 1.82 | $ | 52,338 | $ | 628,056 | ||||||||||||||||||||
1BR/1BA | 1D10 | 88 | 950 | 83,600 | $ | 1,539 | $ | 1.62 | $ | 135,432 | $ | 1,625,184 | ||||||||||||||||||||
1BR/1BA | 1E10 | 16 | 970 | 15,520 | $ | 1,604 | $ | 1.65 | $ | 25,664 | $ | 307,968 | ||||||||||||||||||||
1BR/1BA | 1F10 | 3 | 1,000 | 3,000 | $ | 1,609 | $ | 1.61 | $ | 4,827 | $ | 57,924 | ||||||||||||||||||||
2BR/2BA | 2A20 | 33 | 1,200 | 39,600 | $ | 1,804 | $ | 1.50 | $ | 59,532 | $ | 714,384 | ||||||||||||||||||||
2BR/2BA | 2B20 | 13 | 1,290 | 16,770 | $ | 1,862 | $ | 1.44 | $ | 24,206 | $ | 290,472 | ||||||||||||||||||||
2BR/2BA | 2C20 | 2 | 1,350 | 2,700 | $ | 1,934 | $ | 1.43 | $ | 3,868 | $ | 46,416 | ||||||||||||||||||||
2BR/2BA | 2D20 | 71 | 1,420 | 100,820 | $ | 1,982 | $ | 1.40 | $ | 140,722 | $ | 1,688,664 | ||||||||||||||||||||
2BR/2BA | 2E20 | 3 | 1,590 | 4,770 | $ | 2,267 | $ | 1.43 | $ | 6,801 | $ | 81,612 | ||||||||||||||||||||
2BR/2BA | 2F20 | 28 | 1,790 | 50,120 | $ | 2,234 | $ | 1.25 | $ | 62,552 | $ | 750,624 | ||||||||||||||||||||
3BR/2BA | 3A20 | 11 | 1,550 | 17,050 | $ | 2,433 | $ | 1.57 | $ | 26,763 | $ | 321,156 | ||||||||||||||||||||
3BR/2BA | 3B20 | 11 | 1,650 | 18,150 | $ | 2,464 | $ | 1.49 | $ | 27,104 | $ | 325,248 | ||||||||||||||||||||
3BR/2BA | 3C20 | 7 | 1,900 | 13,300 | $ | 2,634 | $ | 1.39 | $ | 18,438 | $ | 221,256 | ||||||||||||||||||||
3BR/2BA | 3G20 | 5 | 2,060 | 10,300 | $ | 2,839 | $ | 1.38 | $ | 14,195 | $ | 170,340 | ||||||||||||||||||||
3BR/2BA | 3D20 | 1 | 2,140 | 2,140 | $ | 3,199 | $ | 1.49 | $ | 3,199 | $ | 38,388 | ||||||||||||||||||||
3BR/2BA | 3E20 | 1 | 2,370 | 2,370 | $ | 3,819 | $ | 1.61 | $ | 3,819 | $ | 45,828 | ||||||||||||||||||||
4BR/2BA | 4A30 | 1 | 2,350 | 2,350 | $ | 3,979 | $ | 1.69 | $ | 3,979 | $ | 47,748 | ||||||||||||||||||||
Totals/Average | 535 | 967 | 517,490 | $ | 1,568 | $ | 1.62 | $ | 838,736 | $ | 10,064,832 |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 55 |
COMMERCIAL MARKET RENT ANALYSIS
Overview | As previously noted the subject property is comprised of residential and commercial space. The previous analysis analyzed the local market to determine the economic rent for the subject’s 535 apartment units (517,490 square feet). The following analyzes competitive commercial properties in the influencing market to determine the market rent for the 115,550 square feet of commercial space located within The Sterling. The subject’s commercial space is comprised of office; 92,676 square feet of space located on floors 2, 3, and 4; and 22,874 square feet of retail space located along the John F. Kennedy Boulevard street frontage. In this analysis, we surveyed the local market for comparable office and retail properties. The following is a discussion of properties comparable to the subject’s office and retail space. | |
Office Market Analysis | The subject property has 92,676 square feet of office area located on floors 2, 3, and 4. Based on standards in the local market, the subject office space is considered to be representative of a Class B property. It offers standard tenant amenities including janitorial, security, common area services and maintenance, and on-site parking. Tenant spaces are finished-out to tenant specifications and typically include painted interior walls with adequate private office areas, 9-foot high ceiling height with suspended acoustical ceiling, adequate natural light from full-wall windows, suitable electrical and data services. The common area hallways have been recently renovated, are attractive and in good condition. | |
The subject office space is 73% leased at rental rates ranging from $8.95 to $19.96 per square foot. Lease terms are typically 3 to 5 years in duration with periodic increases in base rent through the lease term. Tenant suites range in size from 572 to 7,993 square feet with most tenants in the 1,000 to 3,000 square foot range. Tenants typically pay for operating expenses over a base year stop, plus their pro rata share of electricity. This lease structure is typical for Class B office properties in the local market. | ||
The following is a presentation of the subject office rent roll. The rent roll indicates that the most recent leases at the subject property (Cornerstone Consulting, Public House Investments, and SOMA) have been executed at rental rates in the range of $16.13 to $19.96 per square foot. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 56 |
SUBJECT OFFICE RENT ROLL
Lease Start | Expiration | Base Rental | ||||||||||||||||||||||
Tenant Name | Suite | Tenant Size | Date | Date | Revenue | Rent/SF | ||||||||||||||||||
AIMCO Maintenance Room | 454 | 966 | 12/09 | 11/21 | $ | 0 | $ | 0.00 | ||||||||||||||||
AIMCO Regional Office | 330 | 4,186 | 1/07 | 12/14 | $ | 37,452 | $ | 8.95 | ||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399 | 12/09 | 11/21 | $ | 0 | $ | 0.00 | ||||||||||||||||
Bayada Nurses | 444 | 2,609 | 7/08 | 8/13 | $ | 52,477 | $ | 19.36 | ||||||||||||||||
Caring People Alliance | 220 | 7,252 | 4/04 | 3/11 | $ | 125,883 | $ | 17.36 | ||||||||||||||||
Contemporary Staffing Solution | 307 | 1,500 | 12/06 | 11/10 | $ | 25,035 | $ | 16.69 | ||||||||||||||||
Cornerstone Consultants | 424A | 1,217 | 1/09 | 1/14 | $ | 24,289 | $ | 19.96 | ||||||||||||||||
Devereux Foundation | 200 | 19,982 | 11/03 | 10/10 | $ | 310,887 | $ | 15.56 | ||||||||||||||||
Equitrac Corporation | 340 | 3,052 | 11/07 | 1/13 | $ | 52,857 | $ | 17.32 | ||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588 | 1/03 | 6/10 | $ | 24,485 | $ | 15.42 | ||||||||||||||||
Michael Kleeman | 350 | 3,505 | 7/06 | 6/10 | $ | 54,626 | $ | 15.59 | ||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896 | 10/07 | 9/10 | $ | 31,920 | $ | 16.84 | ||||||||||||||||
Public House Investments | 475 | 646 | 7/08 | 3/13 | $ | 11,952 | $ | 18.50 | ||||||||||||||||
Public House Investments | 480 | 1,475 | 4/08 | 3/13 | $ | 26,592 | $ | 18.03 | ||||||||||||||||
Relief of Widows and Children’s | 303 | 1,165 | 3/03 | 5/15 | $ | 20,727 | $ | 17.79 | ||||||||||||||||
Robert Cole PC | 465 | 572 | 4/08 | 3/11 | $ | 10,776 | $ | 18.84 | ||||||||||||||||
SOMA | 460 | 3,598 | 11/09 | 10/14 | $ | 58,018 | $ | 16.13 | ||||||||||||||||
Wainstein, Yanks & Cohen | 400 | 3,287 | 4/03 | 12/10 | $ | 52,632 | $ | 16.01 | ||||||||||||||||
WB Mason | 230 | 7,993 | 12/07 | 12/17 | $ | 132,102 | $ | 16.53 | ||||||||||||||||
Total/Average | 67,888 | $ | 1,052,710 | $ | 15.51 |
Competitive Office Market | The following office buildings are located within the City Center area of downtown Philadelphia and represent competitive Class A and B office buildings in the influencing market. The rents commanded by these properties provide valuable insight to market rent parameters and are utilized to determine the market rent potential for the office component at the subject property. |
SUMMARY OF OFFICE RENT COMPARABLES
Effective Quoted | TI | Building | ||||||||||||||||||||||||||||||
Name | Address | Yr. Blt. | GLA (SF) | Vac. % | Rent/SF | Expense | Allowance/SF | Class | ||||||||||||||||||||||||
Eight Penn Center | 1628 JFK Boulevard | 1980 | 235,000 | 10.4 | % | $19.50-$22.25 | FSG +E | Negotiable | A | |||||||||||||||||||||||
1528 Walnut | 1528 Walnut Street | 1927 | 206,625 | 10.8 | % | $18.50 | FSG +E | $22 - $28 | B | |||||||||||||||||||||||
Land Title Building | 100 S. Broad Street | 1898 | 365,854 | 6.8 | % | $18.25 | FSG +E | $20-$30 | B | |||||||||||||||||||||||
1608 Walnut | 1608 Walnut Street | 1929 | 227,656 | 14.4 | % | $18.00-$19.00 | FSG +E | Negotiable | B | |||||||||||||||||||||||
The Sterling | 1815 JFK Boulevard | 1961 | 92,676 | 26.8 | % | $18.50 | FSG +E | $25-$32 | B | |||||||||||||||||||||||
LOCATION MAP - OFFICE RENT COMPARABLES
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597918.gif)
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 57 |
The office rent comparables exhibit a rent range of $18.00 to $22.25 per square foot. Three of the four comparable properties exhibit rental rates that fall in a fairly tight range of $18.00 to $19.00 per square foot. The properties producing rents in this range represent Class B offices that are considered most competitive to the subject property. The upper-end of the rent range is represented by the Eight Penn Center building. This is a Class A office building located along JFK Boulevard, approximately two blocks east of the subject property. It is most similar to the subject property with respect to location, however is superior in age. | ||
A rental rate for the subject property is reasoned to be aligned below the rental rate indicated by the Penn Center Building and within the range of rents exhibited by the remaining buildings. It should be noted that the quoted rents are an effective rental rate realized over the lease term. Leases in the local market typically have a base year rent with annual or periodic steps in the rental rate during the lease term. | ||
Based on an analysis of competitive office buildings in the City Center district, the subject’s quoted rental rate of $18.50 per square foot is considered market oriented. Leases in the local market are typically 3 to 5 years in duration, with periodic increases in the base year rental rate during the lease term. Rent increases can vary based on lease duration, tenant allowances, and other considerations, however, step rents of $0.50 per square foot per year are typical. | ||
Landlord-paid tenant improvements are negotiable. The competitive set identified a range of $20 to $30 per square foot. TheThird Quarter-2009, Korpacz Investor Real Estate Survey,a survey of participants active in national real estate markets, indicates that in the Philadelphia office market the tenant improvement allowance ranges from $10.00 to $45.00 per square foot with an average of $26.25 per square foot. Renewing tenants are typically provided with only a minimal allowance, typically to cover the cost of paint and carpet cleaning/replacement. | ||
Office Market Rent – Conclusion | The following market leasing terms are estimated for the subject property office space: |
Base Market Rent | $17.50 | |
Rent Steps | $0.50 per square foot per year | |
Effective Rent (over term) | $18.50/SF | |
Lease Type | Base Year Stop, plus electricity | |
Term | 5 years | |
Free Rent | Three months | |
Tenant Improvements | $25.00/SF (new tenant) | |
$5.00/SF (renewing tenant) |
Retail Market Analysis | The subject property contains 22,874 square feet of retail storefront space located along John F. Kennedy Boulevard. The retail space has good visibility/accessibility, with a high level of pedestrian foot traffic and good proximity to nearby office towers including the adjacent 58- |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 58 |
story Comcast Center. The subject retail space is canopied with individual unit entries and full window glass store fronts. Tenant spaces are finished-out to tenant specifications and typically include painted interior walls with adequate lighting and plumbing. It is representative of functional retail space by local standards. | ||
The subject retail space is 87% leased at rental rates ranging from $24.90 to $39.78 per square foot. Lease terms are typically 3 to 7 years duration with periodic increases in base rent through the lease term. Tenant suites range in size from 186 to 3,800 square feet with most tenants in the 1,000 to 3,000 square foot range. Tenant expense reimbursements range from full-service to triple net lease arrangements, with some tenants paying only for their pro rata share of electric. | ||
The following is a presentation of the subject retail rent roll. The rent roll indicates that the most recent leases at the subject property (K Shoe Repair, Trumark Financial Credit Union, and Young’s Tailor and Cleaner) have been executed at rental rates ranging from $28.50 to $32.26 per square foot. |
SUBJECT RETAIL RENT ROLL
Lease Start | Expiration | Base Rental | ||||||||||||||||||||||
Tenant Name | Suite | Tenant Size | Date | Date | Revenue | Rent/SF | ||||||||||||||||||
7-Eleven Store | 1833 | 3,042 | 12/06 | 11/11 | $ | 104,458 | $ | 34.34 | ||||||||||||||||
AIMCO Leasing Storefront | 1821 | 2,005 | 1/10 | 12/21 | $ | 0 | $ | 0.00 | ||||||||||||||||
City Nails | 1823 | 1,085 | 4/03 | 3/10 | $ | 30,995 | $ | 28.57 | ||||||||||||||||
Hot Tamales | 1805 | 1,414 | 10/03 | 1/19 | $ | 36,972 | $ | 26.15 | ||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800 | 7/06 | 6/11 | $ | 123,780 | $ | 32.57 | ||||||||||||||||
JFK Dental | 1829 | 2,588 | 8/05 | 6/10 | $ | 64,446 | $ | 24.90 | ||||||||||||||||
K Shoe Repair | 1803 | 186 | 12/08 | 1/14 | $ | 6,000 | $ | 32.26 | ||||||||||||||||
Subway | 1827 | 898 | 4/05 | 3/10 | $ | 25,875 | $ | 28.81 | ||||||||||||||||
Trumark Financial Credit Union | 1811 | 3,766 | 1/08 | 12/17 | $ | 149,796 | $ | 39.78 | ||||||||||||||||
Young’s Tailor and Cleaner | 1831 | 1,195 | 12/08 | 11/18 | $ | 34,056 | $ | 28.50 | ||||||||||||||||
Total/Average | 19,979 | $ | 576,378 | $ | 28.85 |
Competitive Retail Market | We identified the following competitive retail spaces located within the City Center area of downtown Philadelphia. The rents commanded by these properties are utilized to help determine the market rent potential for the retail component at the subject property. |
SUMMARY OF RETAIL RENT COMPARABLES
Effective Quoted | TI | |||||||||||
Address | Yr. Blt. | GLA (SF) | Rent/SF | Expense | Allowance/SF | Comment | ||||||
30 South 17th Street | 1975 | 4,868 | $40.00 | NNN | Negotiable | 3 Street Level Units | ||||||
1935 Chestnut Street | N/A | 2,100 | $37.14 | NNN | Negotiable | 1 Street Level Unit | ||||||
1201 Walnut Street | 1988 | 4,394 | $35.00-$40.00 | Full Service | Negotiable | 2 Street Level Units | ||||||
2013 Sansom Street | N/A | 1,500 | $32.00 | NNN | Negotiable | 1 Street Level Unit | ||||||
The Sterling | 1961 | 22,874 | $30.00 | Full Service | $25.00 | |||||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 59 |
LOCATION MAP - RETAIL RENT COMPARABLES
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597919.gif)
The retail rent comparables exhibit a rent range of $32.00 to $40.00 per square foot. The low-end of the range is represented by the 2013 Sansom Street property. This is a low-rise retail unit on a minor street located approximately eight blocks south of the subject property. The upper-end of the rent range is represented by the 30 S. 17th Street property. This property consists of four retail store fronts on the street level of a Class A high rise office building. This comparable, situated adjacent to the Shops at Liberty Place, is considered to be a superior location relative to the subject property. A rental rate for the subject property is reasoned to be aligned below the rental rate indicated by the 17th Street retail. The 1201 Walnut Street comparable consists of two street level retail units located within a parking structure at the corner of 12th and Walnut. This location is near the Thomas Jefferson General Hospital and is generally superior to the subject property. An appropriate rental rate for the subject should be aligned below the rate indicated by this comparable. | ||
Based on an analysis of competitive retail buildings in the City Center district, the subject’s quoted rental rate of $30.00 per square foot is generally regarded as being market oriented. The quoted rent is the effective rate realized over the lease term. Leases in the local market are typically 3 to 5 years in duration, with periodic increases in the base year rental rate during the lease term. Rent increases can vary based on lease duration, tenant allowances, and other considerations, however, step rents of $0.50 per square foot per year are typical. | ||
Landlord-paid tenant improvements are negotiable and vary from property to property. The subject property has a quoted improvement allowance of $25.00 per square foot, an amount that is within market |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 60 |
parameters and considered reasonable. Renewing tenants are provided with only a minimal allowance to cover the cost of paint and floor cover cleaning/replacement. | ||
Office Market Rent – Conclusion | The following market leasing terms are estimated for the subject property office space: |
Base Market Rent | $30.00 | |
Rent Steps | 3% per square foot per year | |
Lease Type: | Modified Full Service, plus electricity | |
Term | 5 years | |
Free Rent | Four months | |
Tenant Improvements | $25.00/SF (new tenant) | |
$8.00/SF (renewing tenant) |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 61 |
HIGHEST AND BEST USE | ||
Definition | Highest and Best Use in appraisal theory is defined by the Appraisal Institute,The Dictionary of Real Estate Appraisal, 4th Edition, Appraisal Institute, Chicago, Illinois, 2002 as“the reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum profitability.” | |
There are typically two highest and best use scenarios: The highest and best use of the property as improved and the highest and best use of the site as if vacant. In each case, the use must pass four “tests”; it must be physically possible, legally permissible, financially feasible, and maximally productive. | ||
HIGHEST AND BEST USE AS VACANT | ||
Definition | Highest and Best Use As Vacant is defined as“among all reasonable, alternative uses, the use that yields the highest present land value, after payments are made for labor, capital, and coordination. The use of a property based on the assumption that the parcel of land is vacant or can be made vacant by demolishing any improvements.” | |
Physically Possible | The subject site’s size and shape would allow for most uses. Surrounding land uses include high intensity developments typically found in a core area urban setting. A high-intensity commercial, multifamily or mixed-use development would be a complementary land use. | |
Legally Permissible | The subject site is zoned for high intensity commercial and mixed uses. The legally permissible and intended use is homogeneous with surrounding development. | |
Financially Feasible | Apartment and commercial properties have realized decreasing occupancy and rent levels as a result of weakness in the regional and national economies. The existing supply of apartment units and office and retail space in the area appears to be sufficient to satisfy the existing level of demand. Given current market conditions, the financial feasibility for large-scale residential and/or commercial development is questionable at this time. Even if financial feasibility were pronounced, it would be difficult to obtain construction financing and capital in the currently constrained credit market. | |
Maximally Productive | Given the above discussion, a holding period of the site as vacant is indicated until market conditions improve to the point financial feasibility is evident. The maximally productive use of the site is future development of a multifamily, or commercial mixed use to its maximum allowed density. | |
Conclusion | Based upon the preceding analysis, it is our opinion that the Highest and Best Use of the site, as vacant, is for mixed-use development consistent |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 62 |
with surrounding land uses when economic conditions improve to a level that permits development. | ||
HIGHEST AND BEST USE AS IMPROVED | ||
Definition | Highest and Best Use As Improved is defined as“the use that should be made of a property as it exists. An existing property should be renovated or retained as is so long as it continues to contribute to the total market value of the property, or until the return from a new improvement would more than offset the cost of demolishing the existing building and constructing a new one”. | |
Physically Possible | The subject is improved with a high-intensity mixed-use development, including residential, office and retail components. With 535 dwelling units and 517,490 square feet, the residential component comprises the vast majority of the development. The residential component was 95% occupied on the date of inspection. The commercial component was 76% occupied overall (87% for the retail and 73% for the office) as of the same date. The improvements are fully functional and have been adequately maintained with no substantial repairs or renovations needed. No alterations or modifications are warranted at this time. | |
Legally Permissible | The subject property is an allowed use of the site. | |
Financially Feasible | The complex is achieving its fair share of the market and is capable of maintaining market rents and occupancy in its current condition. Accordingly, the subject property’s improvements contribute a positive return to the land position and materially to overall property value. | |
Maximally Productive | The property’s improvements generate a return to the real estate that is well in excess of that generated by the underlying land, and there does not appear to be a need for remodeling or repositioning. | |
Conclusion | Based upon the preceding analysis, it is our opinion that the highest and best use of the site as improved is for the continued mixed-use. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 63 |
VALUATION PROCESS | ||
Introduction | There are three traditional approaches that can be employed in establishing the market value of the subject property. In practice, an approach to value is included or omitted based on the property type and the quality and quantity of information available in the marketplace. These approaches and their applicability to the valuation of the subject are summarized as follows. | |
COST APPROACH | The application of the cost approach is based on the principle of substitution. This principle may be stated as follows: no one is justified in paying more for a property than the cost to develop a substitute property of equivalent desirability and utility. In the case of a new building, no deficiencies in the building should exist. The cost approach is typically only a reliable indicator of value for (a) new properties; (b) special use properties; and (c) where the cost of reproducing the improvements is easily and accurately quantified and there is no external obsolescence. In all instances, the issue of an appropriate entrepreneurial profit - the reward for undertaking the risk of construction - remains a highly subjective factor. | |
In the case of income-producing real estate with some items of depreciation, the cost of construction plays a minor and relatively insignificant role in determining market value. Investors are generally not buying, selling, or lending with reliance placed on the methodology of the cost approach to establish value. As agreed with the client, the cost approach is not included within the scope of this appraisal. | ||
INCOME APPROACH | The income capitalization approach is based on the premise that value is derived by converting anticipated benefits into property value. Anticipated benefits include the present value of the net income and the present value of the net proceeds resulting from the re-sale of the property. | |
There are two methods of accomplishing this: (1) direct capitalization of a single year’s income by an overall capitalization rate and; (2) the discounted cash flow in which the annual cash flows and reversionary value are discounted to a present value for the remainder of the property’s productive life or over a reasonable holding (ownership) period. | ||
The subject property has an adequate operations history to determine the income-producing capabilities over the near future. In addition, performance levels of competitive properties serve as an adequate check as to the reasonableness of the subject property’s actual performance. As such, the income capitalization approach is utilized in this appraisal. | ||
SALES COMPARISON | The sales comparison approach is an estimate of value based upon a process of comparing recent sales of similar properties in the surrounding or competing areas to the subject property. Inherent in and central to this approach is the principle of substitution. This comparative process involves judgment as to the similarity of the subject property and the comparable sales with respect to many value factors such as location, contract rent levels, quality of construction, reputation and prestige, age and condition, and the interest transferred, among others. The value estimated through this |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 64 |
approach represents the probable price at which the subject property would be sold by a willing seller to a willing and knowledgeable buyer as of the date of value. | ||
The reliability of this technique is dependent upon the availability of comparable sales data, the verification of the sales data, the degree of comparability and extent of adjustment necessary for differences, and the absence of atypical conditions affecting the individual sales prices. Although the volume of sales activity is down as a result of market conditions, our research revealed adequate sales activity to form a reasonable estimation of the subject property’s market value via the sales comparison approach. | ||
RECONCILIATION | The final step in the appraisal process is to reconcile the various value indications into a single final estimate. Each approach is reviewed in order to determine its appropriateness relative to the subject property. The accuracy of the data available and the quantity of evidence are weighted in each approach. The resulting estimate represents the subject property’s market value as defined in the appraisal. |
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The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 65 |
INCOME CAPITALIZATION APPROACH | ||
VALUATION | We have used the Discounted Cash Flow and Direct Capitalization methods to estimate a value for the subject property. The cash flow is calculated using Excel software. The following income and expense discussion will explain our input for the analysis. | |
Discounted Cash Flow method is defined as“the procedure in which a discount rate is applied to a set of projected income streams and a reversion.” The major tasks involved in this approach to valuing the subject property are: | ||
1. Analysis of the projected rental income stream, establishment of market rent levels, estimation of an appropriate absorption period for the subject property upon lease expiration, projection of future revenues, probable lease renewals at market rates, and probable vacancy and credit losses. | ||
2. Projection of future operating expenses based upon analysis of actual operating expenses reported by the subject property and comparable buildings in the subject property’s competitive market. | ||
3. Derivation of the most probable annual net operating income to be generated by the property over the projection period by subtracting all property expenses from the effective gross income. | ||
4. Estimation of a re-sale price at the end of the investment period by applying an appropriate overall capitalization rate to net operating income and deducting the appropriate selling costs. | ||
5. Determination of a yield rate (discount rate or internal rate of return) that would attract a prudent investor to invest in a similar situation with comparable degrees of risk, non-liquidity, and management. | ||
6. Value is estimated by converting the cash flows into a present value by discounting at the concluded yield rate. | ||
Direct Capitalization is defined as“a method used to convert an estimate of a single year’s income expectancy into an indication of value in one direct step, either by dividing the income estimate by an appropriate rate or by multiplying the income estimate by an appropriate factor. It further states that: only the first year’s income is considered. Yield and value change are implied, but not identified. The rate at which a stabilized net operating income is converted into value is known as an overall capitalization rate (OAR).”The major tasks involved in this approach to valuing the subject property are: | ||
1. Calculate potential gross income from all sources that a competent owner could legally generate. | ||
2. Estimate and deduct an appropriate vacancy and collection loss factor to arrive at effective gross income. | ||
3. Estimate and deduct operating expenses that would be expected during a stabilized year to arrive at a probable net operating income. |
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Philadelphia, Pennsylvania | Page 66 |
4. Develop an appropriate overall capitalization rate to apply to the net operating income. | ||
5. Value is estimated by dividing the net operating income by the overall capitalization rate. Any adjustments to account for differences between the current conditions and stabilized conditions are also considered. | ||
RESIDENTIAL/APARTMENT COMPONENT ANALYSIS | ||
REVENUE ANALYSIS | ||
Potential Gross Income | The potential gross income from apartment unit rentals has been calculated to be $838,736 per month or $10,064,832 for the appraised year based on the conclusion derived in the previous Market Rent Analysis section. | |
Loss to Lease | Loss to lease considers a loss in income due to leases in effect, whereby effective rental rates are lower than asking, or market, rental rates. In the case of the subject property, the loss to lease also accounts partially for concessions that are offered in the form of reduced rent. | |
The operating statements under review indicate a historical loss to lease range of approximately 0.7% to 6.1% of the gross rent potential. Review of the current rent roll indicates that current rents in place are approximately 2.0% below the market rent estimated above. | ||
As market fundamentals begin to improve, concessions will begin to abate and effective rent levels will escalate to be more in line with asking rents. For valuation purposes, the loss to lease allowance is forecasted at 1.5% of the gross rent potential. | ||
Concessions | Concessions within the subject’s influencing area are common. Each of the properties surveyed as rent comparables offer some form of rent concession. The concessions consist of reduced rent or free rent over a portion of the lease term. As indicated above, concessions are also accounted for in the loss to lease allowance. | |
As a percentage of the gross rent potential, the subject’s historical rent concessions were fairly negligible as most were accounted for as a loss to lease in the form of reduced rent over the lease term. According to operating statements under review, concessions have averaged approximately 1.2% over the past three years. For valuation purposes, concessions are estimated at 1.0% of the gross rent potential. | ||
Vacancy/Credit Loss | The subject has been able to maintain its fair share of market occupancy however market fundamentals have weakened over the recent past. The subject still maintains a relatively high occupancy and is currently 5% vacant. | |
The subject’s current 95% level of occupancy is within the range of occupancy levels reported by competitors in the immediate vicinity. Occupancy levels for the competing properties in the influencing market area are outlined in the following table. |
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Philadelphia, Pennsylvania | Page 67 |
OVERVIEW OF COMPETITIVE OCCUPANCY LEVELS
Name | YOC | Total Units | Occupancy | |||||||||
Museum Towers | 1989/2008 | 286 | 97 | % | ||||||||
One Franklin Town | 1982/2005-2009 | 334 | 96 | % | ||||||||
Lofts at 1835 Arch | 1924/2001 | 191 | 97 | % | ||||||||
1500 Locust | 1973/2008 | 610 | 94 | % | ||||||||
Edgewater | 2006 | 290 | 96 | % | ||||||||
Averages | 1924-2006 | 342 | 96 | % | ||||||||
The subject property has a history of strong occupancy and has maintained an average occupancy level in the mid 90% range over the past couple of years. For purposes of the cash flow projection vacancy is forecasted at 4.5%. An additional 0.5% for collection loss has been included in our analysis, bringing the total vacancy and collection loss allowance to 5.0%. | ||
Utility Recovery | The tenants reimburse the landlord for water usage. Reimbursement income has been increasing over the past few years, ranging from $520 to $820 per unit. The budgeted amount for 2010 equates to $910 per unit. Based on historical collections and accounting for inflationary trends, an amount of $445,388 ($833 per unit) is projected for the appraised fiscal year. | |
Other Income | Typically, apartment projects receive additional revenue from sources such as laundry income, vending, application fees, late fees, bad check charges, and deposit forfeitures. Other income receipts at the subject property have ranged from $293 to $452 per unit or 1.4% to 2.3% of the gross potential income over the past couple of years. This amount is projected at $450 per unit for the appraised fiscal year based on historical collections. | |
OPERATING EXPENSES | In order to estimate expenses for the subject property, we have analyzed the subject’s operating expenses for 2007 and 2008, as well as the 2009 (January through November, annualized) and the 2010 budget. Expenses for similar elevator apartment buildings in the Philadelphia area utilizing the Institute of Real Estate Management (IREM) survey of 4,072 apartment units in the metropolitan Philadelphia area was also reviewed and considered. The subject’s operating statements under review have been reconstructed and summarized below. |
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Philadelphia, Pennsylvania | Page 68 |
RECONSTRUCTED OPERATING STATEMENTS – THE STERLING RESIDENTIAL
Year End 2007 | Year End 2008 | 2009 Annualized thru Nov. | 2010 Budget | ||||||||||||||||||||||||||||||||
Total | Per Unit | Total | Per Unit | Total | Per Unit | Total | Per Unit | ||||||||||||||||||||||||||||
INCOME: | |||||||||||||||||||||||||||||||||||
Gross Potential Rent | $ | 10,616,705 | $ | 19,844 | $ | 11,267,305 | $ | 21,060 | $ | 10,664,368 | $ | 19,933 | $ | 10,083,646 | $ | 18,848 | |||||||||||||||||||
Loss to Lease | $ | (452,690 | ) | $ | (846 | ) | $ | (689,024 | ) | $ | (1,288 | ) | $ | (70,284 | ) | $ | (131 | ) | $ | 0 | $ | 0 | |||||||||||||
Vacancy/Collection Loss | $ | (457,394 | ) | $ | (855 | ) | $ | (394,814 | ) | $ | (738 | ) | $ | (717,459 | ) | $ | (1,341 | ) | $ | (478,118 | ) | $ | (894 | ) | |||||||||||
Concessions | $ | (84,833 | ) | $ | (159 | ) | $ | (80,093 | ) | $ | (150 | ) | $ | (235,605 | ) | $ | (440 | ) | $ | (67,601 | ) | $ | (126 | ) | |||||||||||
Parking Income | $ | 77,500 | $ | 145 | $ | 78,000 | $ | 146 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Utility Recovery | $ | 278,033 | $ | 520 | $ | 304,215 | $ | 569 | $ | 438,646 | $ | 820 | $ | 486,998 | $ | 910 | |||||||||||||||||||
Other Income | $ | 238,178 | $ | 445 | $ | 156,602 | $ | 293 | $ | 241,754 | $ | 452 | $ | 240,968 | $ | 450 | |||||||||||||||||||
Effective Gross Income | $ | 10,215,499 | $ | 19,094 | $ | 10,642,191 | $ | 19,892 | $ | 10,321,420 | $ | 19,292 | $ | 10,265,893 | $ | 19,189 | |||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||||||
Payroll | $ | 637,266 | $ | 1,191 | $ | 631,289 | $ | 1,180 | $ | 710,841 | $ | 1,329 | $ | 785,002 | $ | 1,467 | |||||||||||||||||||
Repairs & Maintenance | $ | 516,813 | $ | 966 | $ | 619,882 | $ | 1,159 | $ | 589,269 | $ | 1,101 | $ | 607,050 | $ | 1,135 | |||||||||||||||||||
Administration | $ | 94,501 | $ | 177 | $ | 131,509 | $ | 246 | $ | 139,272 | $ | 260 | $ | 144,103 | $ | 269 | |||||||||||||||||||
Management Fees | $ | 511,045 | $ | 955 | $ | 528,317 | $ | 988 | $ | 514,947 | $ | 963 | $ | 510,648 | $ | 954 | |||||||||||||||||||
Utilities | $ | 1,010,712 | $ | 1,889 | $ | 1,030,886 | $ | 1,927 | $ | 979,419 | $ | 1,831 | $ | 1,056,342 | $ | 1,974 | |||||||||||||||||||
Turnover Expenses | $ | 150,937 | $ | 282 | $ | 142,437 | $ | 266 | $ | 152,445 | $ | 285 | $ | 152,559 | $ | 285 | |||||||||||||||||||
Insurance | $ | 243,996 | $ | 456 | $ | 276,529 | $ | 517 | $ | 199,737 | $ | 373 | $ | 237,848 | $ | 445 | |||||||||||||||||||
Real Estate Taxes | $ | 735,987 | $ | 1,376 | $ | 738,381 | $ | 1,380 | $ | 740,337 | $ | 1,384 | $ | 781,723 | $ | 1,461 | |||||||||||||||||||
Marketing/Leasing | $ | 43,640 | $ | 82 | $ | 63,781 | $ | 119 | $ | 86,609 | $ | 162 | $ | 71,156 | $ | 133 | |||||||||||||||||||
Reserves | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Total Expenses | $ | 3,944,897 | $ | 7,374 | $ | 4,163,011 | $ | 7,781 | $ | 4,112,876 | $ | 7,688 | $ | 4,346,431 | $ | 8,124 | |||||||||||||||||||
Net Operating Income | $ | 6,270,602 | $ | 11,721 | $ | 6,479,180 | $ | 12,111 | $ | 6,208,545 | $ | 11,605 | $ | 5,919,462 | $ | 11,064 |
Source: Client Submitted Information; compiled by CRA |
IREM EXPENSE SURVEY RESULTS – PHILADELPHIA, PA
Philadelphia IREM | Philadelphia IREM | Philadelphia IREM | Region 1&2 IREM | |||||||||||||
Median | High | Low | Median | |||||||||||||
4,072 Units | 4,072 Units | 4,072 Units | 10,679 Units | |||||||||||||
829 SF Avg. Unit Size | 829 SF Avg. Unit Size | 829 SF Avg. Unit Size | 859 SF Avg. Unit Size | |||||||||||||
Payroll/Benefits | $ | 1,185 | $ | 1,633 | $ | 1,028 | $ | 1,435 | ||||||||
Repair & Maintenance | 528 | 622 | 249 | 764 | ||||||||||||
Administration | 462 | 729 | 298 | 607 | ||||||||||||
Management Fees | 572 | 837 | 461 | 750 | ||||||||||||
Utilities | 915 | 994 | 182 | 1,479 | ||||||||||||
Turnover Expenses | 122 | 199 | 83 | 265 | ||||||||||||
Insurance | 378 | 671 | 315 | 340 | ||||||||||||
R.E. Taxes | 920 | 1,384 | 671 | 1,353 | ||||||||||||
Marketing | 0 | 0 | 0 | 0 | ||||||||||||
Reserves | 0 | 0 | 0 | 0 | ||||||||||||
Total Expenses | $ | 5,082 | $ | 7,069 | $ | 3,287 | $ | 6,993 |
Source: IREM Income/Expense Analysis: Conventional Apartments. Compiled by CRA |
Overview | All of the expenses have fluctuated during the past couple of years. In general, expenses are consistent with market data and reflect stabilized operations. No major changes in operations are expected or appear to be required. Expenses are expected to grow at the average annual inflation rate. Each of the expense items is discussed separately below. | |
Payroll and Benefits | Payroll and Benefits expenses typically include the administrative and property maintenance salaries and employee benefits. Since 2007, payroll and benefits have trended upward from $1,191 to $1,329 per unit. The 20010 budget estimates a payroll and benefit expense of $785,002, or $1,467 per unit. The IREM expense comparable data indicates a range of $1,028 to $1,633 per unit. Based on the subject’s historical expenditures, we have processed a payroll expense of $1,450 per unit or $775,750. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 69 |
Repairs & Maintenance | This expense line item includes charges for general maintenance and repairs for both common area and apartment units. The property appears adequately maintained with no noticeable items of deferred maintenance observed during the walk-thru. The average expense level appears reasonable based on historical figures. | |
The maintenance and repair expense at the subject property has ranged from $966 to $1,101 per unit over the past three years. The 2010 budget estimates a maintenance and repair expense of $1,135 per unit. The IREM expense comparable data indicates a range of $249 to $764 per unit. This expense appears to be low in comparison to the subject property; however, itemization of individual expenses into this category can differ from property to property. Based on the actual expenditures at the subject property, a repair/maintenance expense is estimated at $1,125 per unit, or $601,875 for the appraised fiscal year. We include a separate Reserves category in the projection. | ||
General Administration | This category includes administrative charges and costs associated with the running of the management/leasing office including telephone service, office supplies, equipment rental, computers, etc. The administrative expenses at the subject property have ranged from $177 to $260 over the past three reporting periods. The 2010 budget projects this expense to be $269 per unit. The IREM expense comparable data indicates an expense range of $298 to $729 per unit. An amount of $265 per unit or $141,775 is processed for the appraised fiscal year. | |
Management Fee | In the local market management services are typically a function of the revenues produced by the property, usually between 2.0% and 5.0% of collections. Based on historical operating statements under review, the subject property was managed for a fee that is equivalent to 5.0% of collected income. In consideration of the market standards, we have processed a market oriented management fee of 4.0% of the effective gross income. | |
Utilities | This expense line item includes charges for common area and vacant unit electricity, gas, water/sewer and trash collection. At the subject property, tenants reimburse the landlord for gas, water and trash pick-up. Reimbursement income was considered previously in the Revenue Analysis. | |
Utility expenses fluctuate with the weather and changes in supply costs and have become highly variable due to the combination of both influences. The utility expenses at the subject property have ranged from $1,831 to $1,927 per unit over the past three years. The 2010 budget projects a utility expense of $1,974 per unit. The IREM expense comparable survey data suggests a utility expense range of $182 to $1,429 per unit. Utility expenses are generally property specific. Therefore, considering the actual expenditure at the subject property, a utility expense of $1,850 per unit or $989,750 is estimated for the appraised fiscal year. | ||
Turnover/Make Ready | This category covers the expense for make ready work on units that are vacated and readied for tenant occupancy. Over the past three years this |
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The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 70 |
expense has ranged from $266 to $285 per unit. The 2010 budget estimates a turnover expense of $285 per unit. The IREM expense comparable data indicates an expense range of $83 to $265 per unit. Based on the actual expenditure at the subject property, we estimate a turnover and make ready expense of $280 per unit or $149,800 for the appraised fiscal year. | ||
Insurance | Insurance includes fire, liability, theft, and boiler, exclusive of the premiums paid to employee benefit plans. The historical insurance expenses at the subject property range from $373 to $517 per unit. The 2010 budget projects an insurance expense of $445 per unit. The IREM expense comparable data exhibits a range of $315 to $671 per unit. Insurance expenses are projected at $445 per unit or $238,075. | |
Real Estate Taxes | Real estate taxes are processed as discussed within the Real Estate Assessment and Tax Analysis section of this appraisal. The real estate tax projection is $748,690. Over the past several years, real estate taxes at the subject property (assessment and tax rates) have remained unchanged. In our analysis, we have inflated the real estate tax expense at a minimal growth rate of 1% per year. | |
Marketing | This expense includes advertising, the cost of resident and locator referrals, internal leasing commissions, brochures, newsletters and resident activities. The historical marketing charges at the subject property have trended upward from $82 to $162 per unit. The 2010 budget estimates a marketing expense of $133 per unit. Based on historical data marketing expenses are projected at $130 per unit or $69,550. | |
Reserves | Prudent management budgets a certain amount each year in a sinking fund to replace short-lived items, including kitchen appliances and cabinets, bathroom fixtures and tiling, flooring repairs, HVAC replacement and common elements such as the roof, exterior wood and parking areas. | |
Reserves for replacement, while typically not found in submitted operating statements, are necessary in estimating a realistic operating budget so as to maintain the habitability of the apartments. Reserves for replacement for a property of this vintage typically range from $200 to $300 per unit. In order to remain competitive, a reserve of $250 per unit is forecast. This amounts to $133,750. | ||
Total Expenses | On a stabilized basis, the subject’s projected expenses including reserves are projected at $4,248,859, or $7,942 per unit. The indicated operating expense ratio is 42.5% when including reserves and 41.2% without reserves. These expenses are reasonable based on similar properties in the region as reported by the IREM expense survey and discussions with local apartment brokers and managers. The total expenses estimated for the subject are market oriented and reasonable. |
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The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 71 |
VALUATION PRO FORMA | The following valuation pro forma summarizes the stabilized income and expenses described above for the appraised fiscal year. |
STABILIZED PRO FORMA
Per Unit | Total | |||||||||||
Income | ||||||||||||
Gross Potential Rent | $ | 18,813 | $ | 10,064,832 | ||||||||
Loss to Lease | (282 | ) | $ | (150,972 | ) | |||||||
Concessions | (188 | ) | $ | (100,648 | ) | |||||||
Vacancy and Collection Loss | 5.00 | % | $ | (941 | ) | (503,242 | ) | |||||
Utility Recovery | 833 | 445,388 | ||||||||||
Other Income | 450 | 240,750 | ||||||||||
Effective Gross Income | $ | 18,684 | $ | 9,996,108 | ||||||||
Expenses: | ||||||||||||
Payroll and Benefits | $ | 1,450 | $ | 775,750 | ||||||||
Repairs and Maintenance | 1,125 | $ | 601,875 | |||||||||
General and Administrative | 265 | 141,775 | ||||||||||
Property Management Fees | 4 | % | 747 | 399,844 | ||||||||
Utilities | 1,850 | 989,750 | ||||||||||
Unit Turnover/Refurbishment | 280 | 149,800 | ||||||||||
Insurance | 445 | 238,075 | ||||||||||
Real Estate Taxes | 1,399 | 748,690 | ||||||||||
Marketing and Promotion | 130 | 69,550 | ||||||||||
Reserve for Replacements | 250 | 133,750 | ||||||||||
Total Expenses | $ | 7,942 | $ | 4,248,859 | ||||||||
Net Operating Income | $ | 10,743 | $ | 5,747,248 |
DERIVATION OF OAR, IRR AND TERMINAL CAPITALIZATION RATES | ||
Overall Capitalization Rate | This appraisal will consider the following techniques; (a) derivation from comparable sales and (b) investor surveys. | |
Derivation from Sales | The comparable sales presented and analyzed in the Sales Comparison Approach following this section indicate a range of overall capitalization rates of 6.20% to 8.49%. Each of the sale properties are considered generally similar to the subject property in terms of location, age and physical characteristics. The capitalization rates from these sales are summarized in the following table. |
SUMMARY OF MARKET-DERIVED CAPITALIZATION RATES
Property Name | Beechwood | Newport Village | 1420 Fifth | Avondale | Kenmore | |||||
Date of Sale | 12/16/2009 | 6/22/2009 | 9/29/2009 | 5/13/2009 | 9/03/2008 | |||||
Year Built | 1967 | 1975 | 1983 | 1987 | 1949 | |||||
Cap Rate | 8.08% | 7.56% | 8.49% | 6.70% | 6.20% |
The capitalization rates produced by these sales provide market-derived indication as to an appropriate rate for the subject property. Based on recent sales data, a capitalization rate within the range of approximately 6.5% to 8.5% would be expected for the subject property. | ||
Investor Surveys | According to thePricewaterhouseCoopers Korpacz Real Estate Investor Survey, 3rd Quarter 2009rates for apartments reported by survey participants active in the market presently range as shown. |
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Philadelphia, Pennsylvania | Page 72 |
NATIONAL APARTMENT MARKET SURVEY
Internal Rate of Return | 7.50% - 14.00% | Range | ||
10.06% | Average | |||
Overall Capitalization Rate | 5.75% - 10.00% | Range | ||
7.84% | Average | |||
Terminal Capitalization Rate | 5.75% -9.75% | Range | ||
8.06% | Average | |||
Annual Rent Growth Rate | (5.00%) - 3.00% | Range | ||
0.04% | Average | |||
Annual Expense Growth Rate | 2.00% - 3.00% | Range | ||
2.77% | Average |
Source: | Korpacz Real Estate Investor Survey, 3rd Quarter 2009 |
As indicated below, overall rates began to increase beginning Third Quarter 2008 and continue to increase through the Third Quarter 2009, although the rate of increase appears to be moderating. This follows general trends in the overall economy that began to deteriorate in approximately the middle of 2008.
OVERALL CAPITALIZATION RATE TRENDS
Quarter | Average | Basis Point Change | ||||||
3Q09 | 7.84 | % | 35 | |||||
2Q09 | 7.49 | % | 61 | |||||
1Q09 | 6.88 | % | 75 | |||||
4Q08 | 6.13 | % | 27 | |||||
3Q08 | 5.86 | % | 11 | |||||
2Q08 | 5.75 | % | -4 | |||||
1Q08 | 5.79 | % | 4 | |||||
4Q07 | 5.75 | % | -1 | |||||
3Q07 | 5.76 | % | -4 | |||||
2Q07 | 5.80 | % | -9 | |||||
1Q07 | 5.89 | % | -8 |
Source: | Korpacz Real Estate Investor Survey |
Conclusion of OAR | The subject is a 1960s vintage Class A high-rise apartment building situated in the core business area of Philadelphia (City Center District). This location has excellent proximity to the downtown employment district, public transportation, highway linkages, shopping, and entertainment venues. The City Center district is a vibrant 24-hour and desirable residential neighborhood. The subject has unit sizes that reflect market parameters and an amenity package that is typical of the properties in the competitive market. The subject was 95% occupied as of December 2009 according to the submitted rent roll. Based primarily on the good location of the subject property, a below average risk rating is assigned to the subject property. This would imply that an appropriate capitalization rate for the subject property would be aligned with the lower end of the market range and below the investor survey average. | |
An OAR ranging from approximately 6.5% to 8.5% was suggested from a review of actual sales data. Investor surveys indicate rates for apartments in the national market range from 5.75% to 10.000%, averaging 7.84%. In consideration of the preceding data and analysis, a rate in the range of approximately 6.5% to 7.5% is suggested for the subject property. A capitalization rate of 7.0% is concluded. |
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The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 73 |
Selection of IRR and Terminal | ||
Cap Rate Investor Surveys | As noted in the previous investor survey table, IRRs for institutional grade apartments reported by survey participants active in the market presently range from 7.5% to 14.0% with an average of 10.06%. Terminal rates for institutional grade apartments range from 5.75% to 9.75% and average 8.06%, or 22 basis points over the average going in rate of 7.84%. | |
Risk Rate Conclusion | The subject property is classified as a Class A property by local standards and would be expected to have risk similarities commensurate with good quality institutional grade apartments in the local market. The condition is competitive with the other properties and tenancy is near the average for the class and overall market. The location is very good. Considering the good location of the property, the relative strength of the local apartment market as compared to overall trends in the national economy and physical characteristics of the property, a below average risk rating is assigned. Based on our analysis of the subject property and concluded risk rating, an appropriate discount rate is reasoned to be below the survey average. An annual discount rate of approximately 9.0% is considered appropriate, with a terminal cap rate of 7.5%. | |
VALUE BY DIRECT CAPITALIZATION | ||
Stabilized Cash Flow | The stabilized cash flow is based on the previous income and expense discussion. | |
Valuation | Value is calculated by dividing the stabilized net operating income (including an allowance for Reserves) by the concluded overall capitalization rate. Thus the market value of the leased fee interest is calculated as follows: | |
$5,747,248¸ 7.0% = $82,103,543 | ||
Rounded to $82,100,000 | ||
DISCOUNTED CASH FLOW VALUATION | We have also utilized a discounted cash flow analysis of the subject property. This analysis was calculated utilizing the Argus Lease Analysis software program. | |
Projection | For the current market value, the cash flows commence January 1, 2010 for a 10-year holding period with the 11th year net operating income used in developing the subject property’s future reversionary value. | |
Growth Rates | Unless otherwise noted, expenses are grown by an average annual inflation rate of 3.0%. As a result of soft market and overall weak economic conditions, revenue is projected to increase at 1.5% in Year 1 of the cash flow projection and in anticipation of an improvement in market fundamentals revenue is projected to grow by 3% annually thereafter (Years 2 through 10). |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 74 |
Rentable Area | The current unit count of 535 is used throughout the projection period with no reconfigurations. | |
Cash Flow | The stabilized cash flow is based on the previous income and expense discussion. | |
Sales Expense | A sales expense equal to 2.0% of the reversion is reasonable for selling costs. This amount is deducted from the reversionary value. |
DCF ASSUMPTIONS AND VALUE CONCLUSION
Projection Period | 10 years | |
Growth Rates | ||
Revenue | 1.5% - Yr. 1 & 3.0% - thereafter | |
Expenses | 3.0% per year 1% for RE Taxes | |
IRR | 9.0% | |
Terminal Cap Rate | 7.5% | |
Reversionary Cost of Sale | 2.00% | |
Value Indication | $83,649,604 | |
Rounded | $83,600,000 | |
Value per Unit | $ 156,262 |
Source: | CRA Projections |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 75 |
SUMMARY OF CASH FLOW – APARTMENT 10-YEAR HOLDING PERIOD AND REVERSION
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | Year 11 | ||||||||||||||||||||||||||||||||||
For the Years Ending | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | Dec-2019 | Dec-2020 | |||||||||||||||||||||||||||||||||
Operating Ratios | ||||||||||||||||||||||||||||||||||||||||||||
Total Number of Units | 535 | 535 | 535 | 535 | 535 | 535 | 535 | 535 | 535 | 535 | 535 | |||||||||||||||||||||||||||||||||
Average Occupancy | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | ||||||||||||||||||||||
Avg Monthly Rent per Occ Area | 1.62 | 1.65 | 1.69 | 1.75 | 1.80 | 1.85 | 1.91 | 1.96 | 2.02 | 2.08 | 2.15 | |||||||||||||||||||||||||||||||||
Avg Monthly Rent per Occ Unit | 1,567.73 | 1,591.25 | 1,638.98 | 1,688.15 | 1,738.80 | 1,790.96 | 1,844.69 | 1,900.03 | 1,957.03 | 2,015.74 | 2,076.22 | |||||||||||||||||||||||||||||||||
Expense Ratio to Operating Inc | 42.51 | % | 42.89 | % | 42.74 | % | 42.60 | % | 42.46 | % | 42.33 | % | 42.19 | % | 42.06 | % | 41.93 | % | 41.81 | % | 41.68 | % | ||||||||||||||||||||||
Expenses per Unit Area | 8.21 | 8.42 | 8.64 | 8.87 | 9.11 | 9.35 | 9.60 | 9.86 | 10.12 | 10.39 | 10.67 | |||||||||||||||||||||||||||||||||
Expenses per Unit | 7,941.79 | 8,141.62 | 8,357.60 | 8,579.77 | 8,808.33 | 9,043.46 | 9,285.34 | 9,534.19 | 9,790.21 | 10,053.61 | 10,324.61 | |||||||||||||||||||||||||||||||||
Potential Gross Revenue | ||||||||||||||||||||||||||||||||||||||||||||
Potential Market Rent | $ | 10,064,832 | $ | 10,215,804 | $ | 10,522,279 | $ | 10,837,947 | $ | 11,163,085 | $ | 11,497,978 | $ | 11,842,917 | $ | 12,198,205 | $ | 12,564,151 | $ | 12,941,075 | $ | 13,329,308 | ||||||||||||||||||||||
Loss to Lease | (1 | ) | 1 | (3 | ) | (1 | ) | 2 | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||
Potential Rental Revenue | 10,064,832 | 10,215,803 | 10,522,280 | 10,837,944 | 11,163,085 | 11,497,977 | 11,842,917 | 12,198,207 | 12,564,150 | 12,941,075 | 13,329,307 | |||||||||||||||||||||||||||||||||
Scheduled Base Rental Revenue | 10,064,832 | 10,215,803 | 10,522,280 | 10,837,944 | 11,163,085 | 11,497,977 | 11,842,917 | 12,198,207 | 12,564,150 | 12,941,075 | 13,329,307 | |||||||||||||||||||||||||||||||||
Loss to Lease | (150,972 | ) | (153,237 | ) | (157,834 | ) | (162,569 | ) | (167,446 | ) | (172,470 | ) | (177,644 | ) | (182,973 | ) | (188,462 | ) | (194,116 | ) | (199,940 | ) | ||||||||||||||||||||||
Concessions | (100,648 | ) | (102,158 | ) | (105,223 | ) | (108,379 | ) | (111,631 | ) | (114,980 | ) | (118,429 | ) | (121,982 | ) | (125,642 | ) | (129,411 | ) | (133,293 | ) | ||||||||||||||||||||||
Utility Recovery (RUBS) | 445,388 | 458,749 | 472,512 | 486,687 | 501,287 | 516,326 | 531,816 | 547,771 | 564,204 | 581,130 | 598,563 | |||||||||||||||||||||||||||||||||
Other Income | 240,750 | 247,973 | 255,412 | 263,074 | 270,966 | 279,095 | 287,468 | 296,092 | 304,975 | 314,124 | 323,548 | |||||||||||||||||||||||||||||||||
Total Potential Gross Revenue | 10,499,350 | 10,667,130 | 10,987,147 | 11,316,757 | 11,656,261 | 12,005,948 | 12,366,128 | 12,737,115 | 13,119,225 | 13,512,802 | 13,918,185 | |||||||||||||||||||||||||||||||||
General Vacancy | (452,917 | ) | (459,711 | ) | (473,503 | ) | (487,707 | ) | (502,339 | ) | (517,409 | ) | (532,931 | ) | (548,919 | ) | (565,387 | ) | (582,348 | ) | (599,819 | ) | ||||||||||||||||||||||
Collection Loss | (50,324 | ) | (51,079 | ) | (52,611 | ) | (54,190 | ) | (55,815 | ) | (57,490 | ) | (59,215 | ) | (60,991 | ) | (62,821 | ) | (64,705 | ) | (66,647 | ) | ||||||||||||||||||||||
Effective Gross Revenue | 9,996,109 | 10,156,340 | 10,461,033 | 10,774,860 | 11,098,107 | 11,431,049 | 11,773,982 | 12,127,205 | 12,491,017 | 12,865,749 | 13,251,719 | |||||||||||||||||||||||||||||||||
Operating Expenses | ||||||||||||||||||||||||||||||||||||||||||||
Payroll & Employee Exp | 775,750 | 799,023 | 822,993 | 847,683 | 873,113 | 899,307 | 926,286 | 954,075 | 982,697 | 1,012,178 | 1,042,543 | |||||||||||||||||||||||||||||||||
Repairs & Maintenance | 601,875 | 619,931 | 638,529 | 657,685 | 677,416 | 697,738 | 718,670 | 740,230 | 762,437 | 785,310 | 808,870 | |||||||||||||||||||||||||||||||||
General & Administrative | 141,775 | 146,028 | 150,409 | 154,921 | 159,569 | 164,356 | 169,287 | 174,365 | 179,596 | 184,984 | 190,534 | |||||||||||||||||||||||||||||||||
Property Management Fee | 399,844 | 406,254 | 418,441 | 430,994 | 443,924 | 457,242 | 470,959 | 485,088 | 499,641 | 514,630 | 530,069 | |||||||||||||||||||||||||||||||||
Utilities Expenses | 989,750 | 1,019,443 | 1,050,026 | 1,081,527 | 1,113,972 | 1,147,392 | 1,181,813 | 1,217,268 | 1,253,786 | 1,291,399 | 1,330,141 | |||||||||||||||||||||||||||||||||
Unit Turnover/Refurbishment | 149,800 | 154,294 | 158,923 | 163,691 | 168,601 | 173,659 | 178,869 | 184,235 | 189,762 | 195,455 | 201,319 | |||||||||||||||||||||||||||||||||
Insurance Expense | 238,075 | 245,217 | 252,574 | 260,151 | 267,956 | 275,994 | 284,274 | 292,802 | 301,586 | 310,634 | 319,953 | |||||||||||||||||||||||||||||||||
Real Estate Taxes | 748,690 | 756,177 | 763,739 | 771,376 | 779,090 | 786,881 | 794,750 | 802,697 | 810,724 | 818,831 | 827,020 | |||||||||||||||||||||||||||||||||
Marketing & Advertising | 69,550 | 71,637 | 73,786 | 75,999 | 78,279 | 80,628 | 83,046 | 85,538 | 88,104 | 90,747 | 93,469 | |||||||||||||||||||||||||||||||||
Replacement Reserves | 133,750 | 137,763 | 141,895 | 146,152 | 150,537 | 155,053 | 159,704 | 164,496 | 169,430 | 174,513 | 179,749 | |||||||||||||||||||||||||||||||||
Total Operating Expenses | 4,248,859 | 4,355,767 | 4,471,315 | 4,590,179 | 4,712,457 | 4,838,250 | 4,967,658 | 5,100,794 | 5,237,763 | 5,378,681 | 5,523,667 | |||||||||||||||||||||||||||||||||
Net Operating Income | 5,747,250 | 5,800,573 | 5,989,718 | 6,184,681 | 6,385,650 | 6,592,799 | 6,806,324 | 7,026,411 | 7,253,254 | 7,487,068 | 7,728,052 | |||||||||||||||||||||||||||||||||
Cash Flow Before Debt Service & Taxes | $ | 5,747,250 | $ | 5,800,573 | $ | 5,989,718 | $ | 6,184,681 | $ | 6,385,650 | $ | 6,592,799 | $ | 6,806,324 | $ | 7,026,411 | $ | 7,253,254 | $ | 7,487,068 | $ | 7,728,052 | ||||||||||||||||||||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 76 |
DCF PRESENT VALUE SUMMARY — APARTMENTS
For the | P.V. of | P.V. of | P.V. of | |||||||||||||||||
Analysis | Year | Annual | Cash Flow | Cash Flow | Cash Flow | |||||||||||||||
Period | Ending | Cash Flow | @ 8.75% | @ 9.00% | @ 9.25% | |||||||||||||||
Year 1 | Dec-2010 | $ | 5,747,250 | $ | 5,284,828 | $ | 5,272,706 | $ | 5,260,641 | |||||||||||
Year 2 | Dec-2011 | 5,800,573 | 4,904,699 | 4,882,227 | 4,859,907 | |||||||||||||||
Year 3 | Dec-2012 | 5,989,718 | 4,657,132 | 4,625,161 | 4,593,482 | |||||||||||||||
Year 4 | Dec-2013 | 6,184,681 | 4,421,812 | 4,381,384 | 4,341,418 | |||||||||||||||
Year 5 | Dec-2014 | 6,385,650 | 4,198,158 | 4,150,234 | 4,102,965 | |||||||||||||||
Year 6 | Dec-2015 | 6,592,799 | 3,985,605 | 3,931,071 | 3,877,405 | |||||||||||||||
Year 7 | Dec-2016 | 6,806,324 | 3,783,622 | 3,723,292 | 3,664,060 | |||||||||||||||
Year 8 | Dec-2017 | 7,026,411 | 3,591,695 | 3,526,319 | 3,462,278 | |||||||||||||||
Year 9 | Dec-2018 | 7,253,254 | 3,409,333 | 3,339,600 | 3,271,447 | |||||||||||||||
Year 10 | Dec-2019 | 7,487,068 | 3,236,079 | 3,162,618 | 3,090,988 | |||||||||||||||
Total Cash Flow | 65,273,728 | 41,472,963 | 40,994,612 | 40,524,591 | ||||||||||||||||
Property Resale @ 7.50% Cap | 100,979,879 | 43,645,773 | 42,654,992 | 41,688,896 | ||||||||||||||||
Total Property Present Value | $ | 85,118,736 | $ | 83,649,604 | $ | 82,213,487 | ||||||||||||||
Rounded to Thousands | $ | 85,100,000 | $ | 83,600,000 | $ | 82,200,000 |
RECONCILIATION | The value conclusions for the leased fee interest in the subject by the Direct Capitalization methodology and the Discounted Cash Flow Analysis are as follows: |
Direct Capitalization | $ | 82,100,000 | ||
Discounted Cash Flow | $ | 83,600,000 |
Both methods of valuation are considered reasonable, appropriate and are mutually supportive. Many institutional investors give the greatest weight to the Discounted Cash Flow method in the analysis of this form of asset, as it provides an understanding of the subject’s potential cash flow over a typical investment holding period. As an institutional investor is considered a likely investor in an asset of this type, the Discounted Cash Flow method has been given the greatest consideration in the value conclusion. | ||
The market value concluded for the residential/apartment component of the subject property by application of the Income Capitalization Approach, as of December 31, 2009, is: |
EIGHTY-THREE MILLION SIX HUNDRED THOUSAND DOLLARS
($83,600,000)
($83,600,000)
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 77 |
OFFICE/RETAIL ANALYSIS | ||
REVENUE ANALYSIS | ||
Potential Gross Income | The potential gross income from the commercial portion of the subject property (office and retail) has been calculated to be $2,117,628 for the appraised year based on the conclusion derived in the Market Rent Analysis section. This amount includes the in-place contract rents and vacant space processed at market rent. | |
Vacancy/Credit Loss | Occupancy of the commercial space is currently at 76% (87% retail occupancy and 73% office occupancy). Management reports occupancy has historically ranged slightly higher; typically in the range of 85% to 90%. The retail space typically maintains a higher occupancy level than the office space. In the local market office space vacancy is currently at 9.3% in the City Center district, while retail vacancy is 6.9%. | |
The subject’s current office occupancy of 73% is below the range of occupancy levels reported by competitors in the immediate vicinity. Occupancy levels for the competing properties in the influencing market area are outlined in the following table. |
COMPETITIVE OFFICE OCCUPANCY LEVELS
Name | YOC | Occupancy | ||||||
Eight Penn Center | 1980 | 90% | ||||||
1528 Walnut | 1927 | 89 | % | |||||
Land Title Building | 1898 | 93 | % | |||||
1608 Walnut | 1929 | 86 | % | |||||
Averages | 90 | % | ||||||
As market fundamentals begin to improve, area occupancy levels should begin to improve. The subject’s occupancy is expected to follow suit. For purposes of the cash flow projection, the overall average vacancy for the commercial component is forecasted at 10.0% for the 10-year analysis period. An additional 1.0% for collection loss has been included in our analysis, bringing the total vacancy and collection loss allowance to 11.0% for the retail and office space. | ||
Parking Revenue | The subject property has a 125-space below grade parking garage which is currently master-leased to Central Parking Systems of Pennsylvania for a five-year term expiring August 31 2013. Under the terms of the lease, Central Parking pays monthly rent in the amount of $17,938, with periodic increases in the base rent. Rent paid under the parking lease agreement is processed in our discounted cash flow analysis. On an annualized basis, an amount of $217,044 is processed for the appraised fiscal year. | |
Expense Recovery | We have processed expense reimbursements as detailed in the submitted leases and according to the noted market rent parameters. On a stabilized basis, we have utilized the Year 3 expense recovery amount ($133,389) that is projected for the subject property upon reaching a stabilized occupancy level. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 78 |
Other Income | Typically, commercial properties receive minimal revenue from sources such as late fees, bad check charges, and deposit forfeitures. Other income receipts at the subject property have ranged from $794 to $4,787 per year or less than 1.0% of the gross potential income over the past couple of years. This amount is projected at $1,000 for the appraised fiscal year based on historical collections. | |
OPERATING EXPENSES | In order to estimate expenses for the subject property, we have analyzed the subject’s operating expenses for 2007 and 2008, as well as the 2009 (January through November, annualized) and the 2010 budget. The subject’s operating statements under review have been reconstructed and summarized below. |
RECONSTRUCTED OPERATING STATEMENTS – THE STERLING COMMERCIAL
Year End 2007 | Year End 2008 | 2009 Annualized thru Nov. | 2010 Budget | |||||||||||||||||||||||||||||
Total | Per SF | Total | Per SF | Total | Per SF | Total | Per SF | |||||||||||||||||||||||||
INCOME: | ||||||||||||||||||||||||||||||||
Gross Potential Rent | $ | 1,408,679 | $ | 12.19 | $ | 1,650,770 | $ | 14.29 | $ | 1,811,872 | $ | 15.68 | $ | 1,550,079 | $ | 13.41 | ||||||||||||||||
Bad Debt | $ | (15,571 | ) | $ | (0.13 | ) | $ | (2,024 | ) | $ | (0.02 | ) | $ | 0 | $ | 0.00 | $ | (11,365 | ) | $ | (0.10 | ) | ||||||||||
Vacancy/Collection Loss | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | ||||||||||||||||
Concessions | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | ||||||||||||||||
Parking Income | $ | 0 | $ | 0.00 | $ | 52,000 | $ | 0.45 | $ | 0 | $ | 0.00 | $ | 169,068 | $ | 1.46 | ||||||||||||||||
Utility Recovery | $ | 165,589 | $ | 1.43 | $ | 173,162 | $ | 1.50 | $ | 170,263 | $ | 1.47 | $ | 177,950 | $ | 1.54 | ||||||||||||||||
CAM Recovery | $ | 9,345 | $ | 0.08 | $ | 39,110 | $ | 0.34 | $ | 34,552 | $ | 0.30 | $ | 30,000 | $ | 0.26 | ||||||||||||||||
Other Income | $ | 4,591 | $ | 0.04 | $ | 794 | $ | 0.01 | $ | 4,787 | $ | 0.04 | $ | 53 | $ | 0.00 | ||||||||||||||||
Effective Gross Income | $ | 1,572,633 | $ | 13.61 | $ | 1,913,812 | $ | 16.56 | $ | 2,021,474 | $ | 17.49 | $ | 1,915,785 | $ | 16.58 | ||||||||||||||||
EXPENSES: | ||||||||||||||||||||||||||||||||
Payroll | $ | 141,687 | $ | 1.23 | $ | 178,915 | $ | 1.55 | $ | 225,723 | $ | 1.95 | $ | 142,832 | $ | 1.24 | ||||||||||||||||
Repairs & Maintenance | $ | 11,191 | $ | 0.10 | $ | 27,904 | $ | 0.24 | $ | 62,702 | $ | 0.54 | $ | 63,865 | $ | 0.55 | ||||||||||||||||
Janitorial/Cleaning | $ | 158,396 | $ | 1.37 | $ | 152,335 | $ | 1.32 | $ | 95,989 | $ | 0.83 | $ | 104,000 | $ | 0.90 | ||||||||||||||||
Contract Services | $ | 241,296 | $ | 2.09 | $ | 199,742 | $ | 1.73 | $ | 132,241 | $ | 1.14 | $ | 205,896 | $ | 1.78 | ||||||||||||||||
Administration | $ | 30,949 | $ | 0.27 | $ | 38,773 | $ | 0.34 | $ | 55,748 | $ | 0.48 | $ | 51,889 | $ | 0.45 | ||||||||||||||||
Management Fees | $ | 77,940 | $ | 0.67 | $ | 93,970 | $ | 0.81 | $ | 101,981 | $ | 0.88 | $ | 95,789 | $ | 0.83 | ||||||||||||||||
Utilities — Electric | $ | 141,645 | $ | 1.23 | $ | 140,616 | $ | 1.22 | $ | 123,547 | $ | 1.07 | $ | 125,185 | $ | 1.08 | ||||||||||||||||
Utilities — Other | $ | 139,582 | $ | 1.21 | $ | 133,677 | $ | 1.16 | $ | 139,589 | $ | 1.21 | $ | 147,573 | $ | 1.28 | ||||||||||||||||
Insurance | $ | 41,712 | $ | 0.36 | $ | 48,171 | $ | 0.42 | $ | 34,693 | $ | 0.30 | $ | 49,983 | $ | 0.43 | ||||||||||||||||
Real Estate Taxes | $ | 129,880 | $ | 1.12 | $ | 130,303 | $ | 1.13 | $ | 130,647 | $ | 1.13 | $ | 90,242 | $ | 0.78 | ||||||||||||||||
Marketing/Leasing | $ | 17,410 | $ | 0.15 | $ | 0 | $ | 0.00 | $ | 5,649 | $ | 0.05 | $ | 4,140 | $ | 0.04 | ||||||||||||||||
Reserves | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | $ | 0 | $ | 0.00 | ||||||||||||||||
Total Expenses | $ | 1,131,688 | $ | 9.79 | $ | 1,144,406 | $ | 9.90 | $ | 1,108,510 | $ | 9.59 | $ | 1,081,394 | $ | 9.36 | ||||||||||||||||
Net Operating Income | $ | 440,945 | $ | 3.82 | $ | 769,406 | $ | 6.66 | $ | 912,964 | $ | 7.90 | $ | 834,391 | $ | 7.22 |
Source: | Client Submitted Information; compiled by CRA |
Overview | All of the expenses have fluctuated during the past couple of years. In general, expenses are consistent with market data and reflect stabilized operations. No major changes in operations are expected or appear to be required. Expenses are expected to grow at the average annual inflation rate. Each of the expense items is discussed separately below. | |
Recoverable Expenses- Payroll and Benefits | Payroll and Benefits expenses typically include the administrative and property maintenance salaries and employee benefits. Since 2007, payroll and benefits have trended upward from $1.23 to $1.95 per square foot. The 2010 budget estimates a payroll and benefit expense of $142,832, or $1.24 per square foot. Based on the subject’s historical expenditures, we have processed a payroll expense of $1.50 per square foot or $173,327 for the appraised fiscal year. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 79 |
Repairs & Maintenance | This expense line item includes charges for general maintenance and repairs, landscaping and grounds, for both common area and tenant space. The property appears adequately maintained with no noticeable items of deferred maintenance observed during the walk-thru. The average expense level appears reasonable based on historical figures. | |
The maintenance and repair expense at the subject property has trended upward from $0.10 to $0.54 per square foot over the past three years. The 2010 budget estimates a maintenance and repair expense of $0.55 per square foot. Based on the actual expenditures at the subject property, a repair/maintenance expense is estimated at $0.55 per square foot, or $63,553 in the first year of our analysis. We include a separate Reserves category in the projection. | ||
Janitorial and Cleaning | Janitorial expenses typically include the outside service contract for cleaning of the office tenant spaces. Since 2007 janitorial expenses have trended downward from $1.37 to $0.83 per square foot. The 2010 budget estimates this expense at $0.90 per square foot. Based on historical expenditures, a janitorial expense of $0.95 per square foot, or $109,773 is estimated for the subject property. | |
Contract Services | This category typically includes the outside service contract for non-cleaning services such as security, HVAC and elevator repair and maintenance, pest control and other. Since 2007 contract services expenses have trended downward from $2.09 to $1.14 per square foot. The 2010 budget estimates this expense at $1.78 per square foot. Based on historical expenditures, tempered against the 2010 budget, an expense of $1.75 per square foot, or $202,214 is estimated for the subject property | |
General Administration | This category includes administrative charges and costs associated with the running of the management/leasing office including telephone service, office supplies equipment rental, computers, etc. The administrative expenses at the subject property have trended upward from $0.27 to $0.48 per square foot over the past three reporting periods. The 2010 budget projects this expense to be $0.45 per square foot. An amount of $0.45 per square foot or $51,998 is processed for the appraised fiscal year. | |
Management Fee | In the local market management services are typically a function of the revenues produced by the property, usually between 2.0% and 5.0% of collections. Based on historical operating statements under review, the subject property was managed for a fee that is equivalent to 5.0% of collected income. In consideration of the market standards, we have processed a market oriented management fee of 4.0% of the effective gross income. | |
Utilities | Electric: Electricity is broken out separately because many tenants pay their pro-rata share of this cost. The electricity expense for the subject property was $1.23 per square foot in 2007, $1.22 in 2008 and $1.07 in 2009 (annualized). The 2010 budget estimates an electric expense of |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 80 |
$1.08 per square foot. Part of this decline in electric charges is due to energy saving enhancements which have been put in-place at the subject property. The electricity cost has little impact on the value of the building since most of the cost is reimbursed by the tenants. We have estimated a first year electricity expense of $1.10 per square foot, or $127,106. | ||
Other Utilities: The subject property’s other utilities expense includes gas, water and sewer expenses. Management reported other utilities of $1.21 per square foot for 2007, $1.16 in 2008, $1.07 in 2009 (annualized), and $1.08 budgeted for 2010. Based on the subject’s actual expenditure, we have processed other utilities at $1.25 per square foot or $144,439 in our analysis. | ||
Insurance | Insurance includes fire, liability, theft, and boiler, exclusive of the premiums paid to employee benefit plans. The historical insurance expenses at the subject property range from $0.30 to $0.42 per square foot. The 2010 budget projects an insurance expense of $0.43 per square foot. Insurance expenses are projected at $0.40 per square foot, or $46,220. | |
Real Estate Taxes | Real estate taxes are processed as discussed within the Real Estate Assessment and Tax Analysis section of this appraisal. The real estate tax projection is $132,122. | |
Marketing | This expense includes advertising, the cost of resident and locator referrals, internal leasing commissions, brochures, newsletters and resident activities. The historical marketing charges at the subject property have been minimal, averaging $0.07 per square foot over the past three years. The 2010 budget estimates a marketing expense of $0.04 per square foot. Based on historical data, marketing expenses are projected at $0.07 per square foot or $8,089. | |
Non Recoverable Expenses- Reserves | Prudent management budgets a certain amount each year in a sinking fund to replace short-lived items, including lighting, flooring, HVAC replacement and common elements such as the roof, exterior wood and parking areas. Reserves for replacement, while typically not found in submitted operating statements, are necessary in estimating a realistic operating budget so as to maintain the habitability of the apartments. | |
Reserves for replacement for a commercial property of this vintage typically range from $0.10 to $0.45 per square foot. In order to remain competitive, a reserve of $0.20 per square foot is forecast. This amounts to $23,110. | ||
Total Expenses | On a stabilized basis, the subject’s projected expenses excluding reserves are projected at $1,148,291, or $9.94 per square foot, an amount which is reasonable and supported by the historical operating expenses for the subject property. The total expenses estimated for the subject are deemed market oriented and reasonable. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 81 |
VALUATION PRO FORMA | The following valuation pro forma summarizes the stabilized income and expenses described above for the appraised fiscal year. |
STABILIZED PRO FORMA – COMMERCIAL COMPONENT
Per SF | Total | |||||||||||
Income | ||||||||||||
In Place Contract Rent | $ | 13.98 | $ | 1,629,088 | ||||||||
Vacant Office Space at Market | 3.72 | 433,790 | ||||||||||
Vacant Retail Space at Market | 0.47 | 54,750 | ||||||||||
Gross Potential Rent | $ | 18.17 | $ | 2,117,628 | ||||||||
Vacancy and Collection Loss | 11.00 | % | (2.02 | ) | (232,939 | ) | ||||||
Recovery Income | $ | 1.16 | $ | 133,521 | ||||||||
Other Income | 0.01 | 1,000 | ||||||||||
Garage Parking Lease | $ | 1.86 | 217,044 | |||||||||
Effective Gross Income | $ | 19.35 | $ | 2,236,254 | ||||||||
Expenses | ||||||||||||
Payroll & Benefits | $ | 1.50 | $ | 173,327 | ||||||||
Repairs and Maintenance | 0.55 | 63,553 | ||||||||||
Janitorial and Cleaning | 0.95 | 109,773 | ||||||||||
Contract Services | 1.75 | 202,214 | ||||||||||
Administrative and General | 0.45 | 51,998 | ||||||||||
Management Fees | 4.00 | % | 0.77 | 89,450 | ||||||||
Utilities — Electric | 1.10 | 127,106 | ||||||||||
Utilities — Other | 1.25 | 144,439 | ||||||||||
Insurance | 0.40 | 46,220 | ||||||||||
Real Estate Taxes | 1.14 | 132,122 | ||||||||||
Marketing and Promotion | 0.07 | 8,089 | ||||||||||
Reserve for Replacements | 0.20 | 23,110 | ||||||||||
Total Expenses | $ | 10.14 | $ | 1,171,401 | ||||||||
Net Operating Income | $ | 9.22 | $ | 1,064,853 |
DERIVATION OF OAR, IRR AND TERMINAL CAPITALIZATION RATES
Investor Surveys | According to thePricewaterhouseCoopers Korpacz Real Estate Investor Survey, 3rd Quarter 2009rates for Philadelphia office buildings and National Retail Strip Shopping Centers, reported by survey participants active in the market presently range as shown. |
PHILADELPHIA OFFICE MARKET SURVEY
Internal Rate of Return | 9.00% - 11.00% | Range | ||
9.87% | Average | |||
Overall Capitalization Rate | 8.00% - 11.00% | Range | ||
9.19% | Average | |||
Terminal Capitalization Rate | 8.00% -10.00% | Range | ||
9.17% | Average | |||
Annual Rent Growth Rate | (5.00%) - 3.00% | Range | ||
0.18% | Average | |||
Annual Expense Growth Rate | 3.00% - 3.00% | Range | ||
3.00% | Average |
Source: | Korpacz Real Estate Investor Survey, 3rd Quarter 2009 |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 82 |
NATIONAL STRIP SHOPPING CENTER MARKET SURVEY
Internal Rate of Return | 7.75% - 12.00% | Range | ||
9.38% | Average | |||
Overall Capitalization Rate | 7.50% - 11.00% | Range | ||
8.41% | Average | |||
Terminal Capitalization Rate | 7.25% -10.00% | Range | ||
8.61% | Average | |||
Annual Rent Growth Rate | 0.00% - 3.00% | Range | ||
0.93% | Average | |||
Annual Expense Growth Rate | 1.00% - 4.00% | Range | ||
2.79% | Average |
Source: | Korpacz Real Estate Investor Survey, 3rd Quarter 2009 |
Conclusion of OAR | The subject is a 1960s vintage Class B commercial property which is part of a mixed use high rise development situated in the core business area of Philadelphia (City Center District). This location has excellent proximity to the downtown employment district, public transportation, highway linkages and entertainment venues. The City Center district is a vibrant and desirable 24-hour commercial and residential neighborhood. The commercial component at the subject property was 76% occupied as of December 2009 according to data ascertained from submitted rent rolls. The commercial component of the subject property displays a risk level that is typical or average for its asset class. | |
Investor surveys indicate that the average rate for office and retail properties range from 7.50% to 11.000%, averaging 8.41% to 9.19% respectively. In consideration of the average risk rating assigned to the commercial component of the subject property, an overall rate similar to the survey averages would be expected. In consideration of the preceding data, an overall rate in the range of approximately 8.4% to 9.2% is suggested for the subject property. A capitalization rate of 8.50% is concluded. | ||
Selection of IRR and Terminal Cap Rate Investor Surveys | As noted in the previous investor survey table, IRRs for institutional grade office and retail properties reported by survey participants active in the market presently range from 7.75% to 12.0% with averages of 9.38% and 9.87%. Terminal rates for institutional grade office and retail strip centers range from 7.25% to 10.00% with averages of 8.61% and 9.17%. | |
Risk Rate Conclusion | The subject property is classified as a Class B property by local standards and would be expected to have risk similarities commensurate with average quality office and retail properties in the local market. The commercial component is competitive with the other properties and the tenancy is typical for the class and overall market. The location is good. | |
Considering the physical characteristics and tenancy of the commercial component, an average risk rating is assigned. Based on our analysis of the subject property, an appropriate blended discount rate is reasoned to be within the range of rates illustrated by the survey averages. An annual discount rate of approximately 9.5% is considered appropriate, with a terminal cap rate of 9.0%. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 83 |
VALUE BY DIRECT CAPITALIZATION | ||
Stabilized Cash Flow | The stabilized cash flow is based on the previous income and expense discussion. | |
Valuation | Value is calculated by dividing the stabilized net operating income (including an allowance for Reserves) by the concluded overall capitalization rate. Thus the stabilized market value of the leased fee interest is calculated as follows: | |
$1,064,853¸ 8.50% = $12,527,682 | ||
The commercial component is currently 76% occupied and is projected to reach a stabilized occupancy of 90% in Year 2 (YE December 2011) upon absorption of the currently vacant office and retail space. Accordingly, the cost associated with achieving stabilized occupancy must be deducted from the stabilized value concluded above. These costs include leasing commissions, tenant improvements, rent abatements, and revenue loss incurred during the lease-up period. The following is a summary of the adjustments for these expenses. |
“AS IS” VALUE SUMMARY
SF | Total | |||||||
Net Operating Income | $ | 9.22 | $ | 1,064,853 | ||||
Capitalization Rate | 8.50 | % | ||||||
Indicated Value “As Stabilized” | $ | 108.42 | $ | 12,527,680 | ||||
Less: PV of Revenue Loss | 629,107 | |||||||
PV of Lease Up | 1,774,351 | |||||||
Total Deduction | 2,403,459 | |||||||
Indicated “As Is” Value | $ | 10,124,221 | ||||||
Rounded | $ | 87.41 | $ | 10,100,000 |
DISCOUNTED CASH FLOW | ||
VALUATION | We have also utilized a discounted cash flow analysis of the subject property. This analysis was calculated utilizing the Argus Lease Analysis software program. | |
Projection | For the current market value, the cash flows commence January 1, 2010 for a 10-year holding period with the 11th year net operating income used in developing the subject property’s future reversionary value. | |
Growth Rates | Unless otherwise noted, expenses are grown by an average annual inflation rate of 3.0%. As a result of soft market and overall weak economic conditions, revenue is projected to increase at 0.0% in Year 1 of the cash flow projection and in anticipation of an improvement in market fundamentals revenue is projected to grow by 3% annually thereafter (Years 2 through 10). | |
Rentable Area | The current net rentable area for the commercial component of 115,551 square feet is used throughout the projection period with no reconfigurations. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 84 |
Cash Flow | The stabilized cash flow is based on the previous income and expense discussion. | |
Sales Expense | A sales expense equal to 2.0% of the reversion is reasonable for selling costs. This amount is deducted from the reversionary value. |
DCF ASSUMPTIONS AND VALUE CONCLUSION
Projection Period | 10 years | |||
Growth Rates | ||||
Revenue | 0.0% - yr1 & 3.0% - thereafter | |||
Expenses | 3.0% per year | |||
IRR | 9.5% | |||
Terminal Cap Rate | 9.0% | |||
Reversionary Cost of Sale | 2.00% | |||
Value Indication | $10,267,522 | |||
Rounded | $10,300,000 | |||
Value per SF | $ 89.14 |
Source: | CRA Projections |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 85 |
SUMMARY OF CASH FLOW – COMMERCIAL 10-YEAR HOLDING PERIOD AND REVERSION
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | Year 11 | ||||||||||||||||||||||||||||||||||
For the Years Ending | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | Dec-2019 | Dec-2020 | |||||||||||||||||||||||||||||||||
Potential Gross Revenue | ||||||||||||||||||||||||||||||||||||||||||||
Base Rental Revenue | $ | 2,299,677 | $ | 2,449,714 | $ | 2,453,879 | $ | 2,469,453 | $ | 2,471,779 | $ | 2,542,487 | $ | 2,688,597 | $ | 2,770,089 | $ | 2,785,348 | $ | 2,829,259 | $ | 2,860,451 | ||||||||||||||||||||||
Absorption & Turnover Vacancy | (512,948 | ) | (361,416 | ) | (103,673 | ) | (36,120 | ) | (18,809 | ) | (146,247 | ) | (253,677 | ) | (74,330 | ) | (122,017 | ) | (39,155 | ) | (87,642 | ) | ||||||||||||||||||||||
Base Rent Abatements | (84,525 | ) | (225,295 | ) | (81,256 | ) | (34,817 | ) | (15,923 | ) | (78,127 | ) | (312,864 | ) | (128,556 | ) | (137,133 | ) | (56,610 | ) | (59,727 | ) | ||||||||||||||||||||||
Scheduled Base Rental Revenue | 1,702,204 | 1,863,003 | 2,268,950 | 2,398,516 | 2,437,047 | 2,318,113 | 2,122,056 | 2,567,203 | 2,526,198 | 2,733,494 | 2,713,082 | |||||||||||||||||||||||||||||||||
Base Rental Step Revenue | 1,957 | 5,024 | 28,242 | 56,898 | 87,260 | 114,923 | 52,983 | 49,548 | 69,093 | 99,105 | 123,464 | |||||||||||||||||||||||||||||||||
CPI & Other Adjustment Revenue | 362 | 4,831 | 14,682 | 29,743 | 48,009 | 59,152 | 53,600 | 51,390 | 72,928 | 81,550 | 107,294 | |||||||||||||||||||||||||||||||||
Expense Reimbursement Revenue | ||||||||||||||||||||||||||||||||||||||||||||
Payroll and Benefits | 4,449 | 804 | 4,510 | 8,008 | 12,216 | 15,192 | 7,495 | 9,631 | 9,892 | 13,984 | 17,059 | |||||||||||||||||||||||||||||||||
Repairs and Maintenance | 1,632 | 297 | 1,652 | 2,938 | 4,474 | 5,570 | 2,747 | 3,530 | 3,625 | 5,131 | 6,256 | |||||||||||||||||||||||||||||||||
Janitorial and Cleaning | 2,818 | 511 | 2,856 | 5,073 | 7,734 | 9,621 | 4,750 | 6,099 | 6,265 | 8,857 | 10,803 | |||||||||||||||||||||||||||||||||
Contract Services | 5,192 | 939 | 5,263 | 9,342 | 14,248 | 17,724 | 8,745 | 11,238 | 11,542 | 16,316 | 19,903 | |||||||||||||||||||||||||||||||||
Administration & General | 1,335 | 242 | 1,351 | 2,402 | 3,664 | 4,558 | 2,247 | 2,891 | 2,969 | 4,194 | 5,118 | |||||||||||||||||||||||||||||||||
Management Fee | 1,847 | 354 | 2,259 | 4,098 | 6,304 | 7,801 | 3,428 | 4,814 | 4,920 | 7,199 | 8,802 | |||||||||||||||||||||||||||||||||
Utilities — Electric | 90,721 | 96,400 | 106,281 | 108,625 | 113,971 | 114,104 | 120,130 | 146,550 | 154,148 | 163,917 | 165,667 | |||||||||||||||||||||||||||||||||
Utilities — Other | 3,709 | 670 | 3,756 | 6,671 | 10,178 | 12,660 | 6,243 | 8,027 | 8,247 | 11,656 | 14,219 | |||||||||||||||||||||||||||||||||
Insurance | 1,187 | 270 | 1,362 | 2,436 | 3,709 | 4,540 | 2,382 | 2,743 | 2,997 | 4,353 | 5,445 | |||||||||||||||||||||||||||||||||
Real Estate Taxes | 3,393 | 770 | 3,889 | 6,968 | 10,609 | 12,980 | 6,807 | 7,849 | 8,558 | 12,445 | 15,561 | |||||||||||||||||||||||||||||||||
Marketing and Promotion | 209 | 37 | 210 | 374 | 569 | 708 | 350 | 452 | 464 | 651 | 798 | |||||||||||||||||||||||||||||||||
Total Reimbursement Revenue | 116,492 | 101,294 | 133,389 | 156,935 | 187,676 | 205,458 | 165,324 | 203,824 | 213,627 | 248,703 | 269,631 | |||||||||||||||||||||||||||||||||
Other Income | 1,000 | 1,030 | 1,061 | 1,093 | 1,126 | 1,159 | 1,194 | 1,230 | 1,267 | 1,305 | 1,344 | |||||||||||||||||||||||||||||||||
Total Potential Gross Revenue | 1,822,015 | 1,975,182 | 2,446,324 | 2,643,185 | 2,761,118 | 2,698,805 | 2,395,157 | 2,873,195 | 2,883,113 | 3,164,157 | 3,214,815 | |||||||||||||||||||||||||||||||||
General Vacancy | (110,786 | ) | (184,278 | ) | (203,941 | ) | (77,353 | ) | (166,987 | ) | (119,969 | ) | (215,274 | ) | (169,595 | ) | ||||||||||||||||||||||||||||
Collection Loss | (17,022 | ) | (18,630 | ) | (22,690 | ) | (23,985 | ) | (24,370 | ) | (23,181 | ) | (21,221 | ) | (25,672 | ) | (25,262 | ) | (27,335 | ) | (27,131 | ) | ||||||||||||||||||||||
Effective Gross Revenue | 1,804,993 | 1,956,552 | 2,312,848 | 2,434,922 | 2,532,807 | 2,598,271 | 2,373,936 | 2,680,536 | 2,737,882 | 2,921,548 | 3,018,089 | |||||||||||||||||||||||||||||||||
Operating Expenses | ||||||||||||||||||||||||||||||||||||||||||||
Payroll and Benefits | 173,327 | 178,526 | 183,882 | 189,399 | 195,081 | 200,933 | 206,961 | 213,170 | 219,565 | 226,152 | 232,936 | |||||||||||||||||||||||||||||||||
Repairs and Maintenance | 63,553 | 65,460 | 67,423 | 69,446 | 71,530 | 73,675 | 75,886 | 78,162 | 80,507 | 82,922 | 85,410 | |||||||||||||||||||||||||||||||||
Janitorial and Cleaning | 109,773 | 113,067 | 116,459 | 119,952 | 123,551 | 127,258 | 131,075 | 135,007 | 139,058 | 143,229 | 147,526 | |||||||||||||||||||||||||||||||||
Contract Services | 202,214 | 208,281 | 214,529 | 220,965 | 227,594 | 234,422 | 241,454 | 248,698 | 256,159 | 263,844 | 271,759 | |||||||||||||||||||||||||||||||||
Administration & General | 51,998 | 53,558 | 55,165 | 56,820 | 58,524 | 60,280 | 62,088 | 63,951 | 65,869 | 67,846 | 69,881 | |||||||||||||||||||||||||||||||||
Management Fee | 72,200 | 78,262 | 92,514 | 97,397 | 101,312 | 103,931 | 94,957 | 107,221 | 109,515 | 116,862 | 120,724 | |||||||||||||||||||||||||||||||||
Utilities — Electric | 127,106 | 130,919 | 134,847 | 138,892 | 143,059 | 147,351 | 151,771 | 156,324 | 161,014 | 165,845 | 170,820 | |||||||||||||||||||||||||||||||||
Utilities — Other | 144,439 | 148,772 | 153,235 | 157,832 | 162,567 | 167,444 | 172,467 | 177,641 | 182,971 | 188,460 | 194,114 | |||||||||||||||||||||||||||||||||
Insurance | 46,220 | 47,607 | 49,035 | 50,506 | 52,021 | 53,582 | 55,190 | 56,845 | 58,551 | 60,307 | 62,116 | |||||||||||||||||||||||||||||||||
Real Estate Taxes | 132,122 | 136,086 | 140,168 | 144,373 | 148,704 | 153,166 | 157,761 | 162,493 | 167,368 | 172,389 | 177,561 | |||||||||||||||||||||||||||||||||
Marketing and Promotion | 8,089 | 8,331 | 8,581 | 8,839 | 9,104 | 9,377 | 9,658 | 9,948 | 10,246 | 10,554 | 10,870 | |||||||||||||||||||||||||||||||||
Reserve Replacement | 23,110 | 23,804 | 24,518 | 25,253 | 26,011 | 26,791 | 27,595 | 28,423 | 29,275 | 30,154 | 31,058 | |||||||||||||||||||||||||||||||||
Total Operating Expenses | 1,154,151 | 1,192,673 | 1,240,356 | 1,279,674 | 1,319,058 | 1,358,210 | 1,386,863 | 1,437,883 | 1,480,098 | 1,528,564 | 1,574,775 | |||||||||||||||||||||||||||||||||
Net Operating Income | 650,842 | 763,879 | 1,072,492 | 1,155,248 | 1,213,749 | 1,240,061 | 987,073 | 1,242,653 | 1,257,784 | 1,392,984 | 1,443,314 | |||||||||||||||||||||||||||||||||
Leasing & Capital Costs | ||||||||||||||||||||||||||||||||||||||||||||
Tenant Improvements | 360,923 | 712,991 | 284,088 | 102,043 | 19,357 | 219,258 | 787,642 | 250,419 | 300,946 | 110,778 | 197,497 | |||||||||||||||||||||||||||||||||
Leasing Commissions | 104,576 | 192,301 | 66,774 | 29,371 | 5,875 | 66,366 | 235,538 | 84,382 | 93,229 | 37,167 | 58,119 | |||||||||||||||||||||||||||||||||
Total Leasing & Capital Costs | 465,499 | 905,292 | 350,862 | 131,414 | 25,232 | 285,624 | 1,023,180 | 334,801 | 394,175 | 147,945 | 255,616 | |||||||||||||||||||||||||||||||||
Cash Flow Before Debt Service & Taxes | $ | 185,343 | $ | (141,413 | ) | $ | 721,630 | $ | 1,023,834 | $ | 1,188,517 | $ | 954,437 | $ | (36,107 | ) | $ | 907,852 | $ | 863,609 | $ | 1,245,039 | $ | 1,187,698 | ||||||||||||||||||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 86 |
DCF PRESENT VALUE SUMMARY – COMMERCIAL COMPONENT
For the | P.V. of | P.V. of | P.V. of | |||||||||||||||||
Analysis | Year | Annual | Cash Flow | Cash Flow | Cash Flow | |||||||||||||||
Period | Ending | Cash Flow | @ 9.25% | @ 9.50% | @ 9.75% | |||||||||||||||
Year 1 | Dec-2010 | $ | 185,343 | $ | 169,650 | $ | 169,263 | $ | 168,877 | |||||||||||
Year 2 | Dec-2011 | (141,413 | ) | (118,480 | ) | (117,940 | ) | (117,403 | ) | |||||||||||
Year 3 | Dec-2012 | 721,630 | 553,414 | 549,632 | 545,885 | |||||||||||||||
Year 4 | Dec-2013 | 1,023,834 | 718,694 | 712,153 | 705,686 | |||||||||||||||
Year 5 | Dec-2014 | 1,188,517 | 763,656 | 754,979 | 746,419 | |||||||||||||||
Year 6 | Dec-2015 | 954,437 | 561,331 | 553,685 | 546,160 | |||||||||||||||
Year 7 | Dec-2016 | (36,107 | ) | (19,438 | ) | (19,129 | ) | (18,826 | ) | |||||||||||
Year 8 | Dec-2017 | 907,852 | 447,346 | 439,240 | 431,300 | |||||||||||||||
Year 9 | Dec-2018 | 863,609 | 389,515 | 381,584 | 373,831 | |||||||||||||||
Year 10 | Dec-2019 | 1,245,039 | 514,007 | 502,391 | 491,064 | |||||||||||||||
Total Cash Flow | 6,912,741 | 3,979,695 | 3,925,858 | 3,872,993 | ||||||||||||||||
Property Resale @ 9% Cap Rate | 15,716,086 | 6,488,285 | 6,341,664 | 6,198,678 | ||||||||||||||||
Total Property Present Value | $ | 10,467,980 | $ | 10,267,522 | $ | 10,071,671 | ||||||||||||||
Rounded to Thousands | $ | 10,468,000 | $ | 10,268,000 | $ | 10,072,000 |
RECONCILIATION | The value conclusions for the leased fee interest in the subject by the Direct Capitalization methodology and the Discounted Cash Flow Analysis are as follows: |
Direct Capitalization | $ | 10,100,000 | ||
Discounted Cash Flow | $ | 10,300,000 |
Both methods of valuation are considered reasonable, appropriate and are mutually supportive. Many institutional investors give the greatest weight to the Discounted Cash Flow method in the analysis of this form of asset, as it provides an understanding of the subject’s potential cash flow over a typical investment holding period. As an institutional investor is considered a likely investor in an asset of this type, the Discounted Cash Flow method has been given the greatest consideration in the value conclusion. | ||
The market value concluded for the commercial component of the subject property by application of the Income Capitalization Approach, as of December 31, 2009, is: | ||
TEN MILLION THREE HUNDRED THOUSAND DOLLARS ($10,300,000) | ||
THE STERLING AGGREGATE VALUE CONCLUSION | The following is a summary of the value conclusions via the Income Capitalizations Approach for the residential and commercial components which comprise the subject property. |
SUMMARY OF AGGREGATE VALUE CONCLUSION
Direct Capitalization | Discounted Cash Flow | |||||||
Residential Component | $ | 82,100,000 | $ | 83,600,000 | ||||
Commercial Component | $ | 10,100,000 | $ | 10,300,000 | ||||
Total | $ | 92,200,000 | $ | 93,900,000 | ||||
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 87 |
As previously indicated, the values concluded through the Discounted Cash Flow method are given the greatest consideration in the final determination of Market Value. Accordingly, the Market Value of the Leased Fee Interest in the subject property (The Sterling), free and clear of financing, via the Income Capitalization Approach, as of December 31, 2009, is: | ||
NINETY-THREE MILLION NINE HUNDRED THOUSAND DOLLARS
($93,900,000)
($93,900,000)
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 88 |
SALES COMPARISON APPROACH
VALUATION METHODOLOGY | The basic steps in processing the sales comparison approach are outlined as follows: | |
1. Research the market for recent sales transactions, listings, and offers to purchase or sell of properties similar to the subject property. | ||
2. Select a relevant unit of comparison and develop a comparative analysis. | ||
3. Compare comparable sale properties with the subject property using the elements of comparison and adjust the price of each comparable to the subject property. | ||
4. Reconcile the various value indications produced by the analysis of the comparables. | ||
REGIONAL APARTMENT SALES OVERVIEW | As a result of current economic conditions, transaction velocity has declined considerably over the past 12 to 18 months. As a result, there is very limited sales activity for most types of commercial property in the local market. Due to the lack of recent sales data from the local market, we expanded our search for sales to include other metropolitan areas within the northeastern United States. In addition to sales from the local Philadelphia market, data was ascertained from the Washington D.C. and New York City metro areas. | |
In our search for sales data, we identified the recent sale of two low-rise garden style apartments within the Philadelphia area and the sale of three mid and high-rise apartment buildings in the New York City and Washington, D.C. markets. These sales are considered adequate to formulate a defensible value for the subject property via sales comparison. | ||
Presentation of Comparable Sales | To estimate the property value by the sales comparison approach, we analyzed sales from the influencing market that are most similar to the subject property in terms of age, size, tenant profile and location. The sales are compared on a price-per-unit basis, as this is a common method of comparison for such properties. | |
The comparable sales summarized in the following chart below and plotted on the map, range in price from $65,625 to $182,708 per unit. While these unit prices implicitly contain both the physical and economic factors affecting real estate, these statistics do not explicitly convey many of the details surrounding a specific property. Thus, this single index to the valuation of the subject property has some limitations. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 89 |
PRESENTATION OF COMPARABLE APARTMENT SALES DATA
Project Name | Beechwood Gardens | Newport Village | 1420 Fifth | Avondale | The Kenmore | |||||||||||||||
Sale No. | 1 | 2 | 3 | 4 | 5 | |||||||||||||||
Address | 9805 Haldeman | 8590 New Falls | 1420 5th Avenue | 8301 Ashford | 5415 Connecticut | |||||||||||||||
Location | Philadelphia, PA | Falls Township, PA | New York, NY | Laurel, MD | Washington, DC | |||||||||||||||
Type | Garden | Garden | Mid-Rise | High Rise | High Rise | |||||||||||||||
Grantor | REIT Home Properties | Newport Village | Metrovest Equities | Washington REIT | Archstone Smith Trust | |||||||||||||||
Grantee | N/A | NV Partners, LP | L&M Development | Goldberg Avondale | WRIT-Kenmore | |||||||||||||||
Sale Price | $ | 10,500,000 | $ | 12,480,000 | $ | 21,925,000 | $ | 19,750,000 | $ | 58,250,000 | ||||||||||
Date of Sale | 12/16/09 | 06/22/09 | 09/29/09 | 05/13/09 | 09/03/08 | |||||||||||||||
Year Built | 1967 | 1975 | 1983 | 1987 | 1949 | |||||||||||||||
No. of Units | 160 | 182 | 120 | 237 | 369 | |||||||||||||||
No. of Stories | 2.0 | 3.0 | 6.0 | 11.0 | 10.0 | |||||||||||||||
Net Rentable Area (NRA) | 140,000 | 120,624 | 108,390 | 170,172 | 270,000 | |||||||||||||||
Average Unit Size (SF) | 875 | 663 | 903 | 718 | 732 | |||||||||||||||
Effective Gross Income | $ | 1,765,205 | $ | 1,834,735 | $ | 4,021,039 | $ | 2,938,671 | $ | 6,067,080 | ||||||||||
Operating Expenses | $ | 917,045 | $ | 891,089 | $ | 2,159,606 | $ | 1,615,421 | $ | 2,455,580 | ||||||||||
Net Operating Income | $ | 848,160 | $ | 943,646 | $ | 1,861,433 | $ | 1,323,250 | $ | 3,611,500 | ||||||||||
NOI Per Unit | $ | 5,301 | $ | 5,185 | $ | 15,512 | $ | 5,583 | $ | 9,787 | ||||||||||
EGIM | 5.95 | 6.80 | 5.45 | 6.72 | 9.60 | |||||||||||||||
OER | 52 | % | 49 | % | 54 | % | 55 | % | 40 | % | ||||||||||
Overall Capitalization Rate (OAR) | 8.08 | % | 7.56 | % | 8.49 | % | 6.70 | % | 6.20 | % | ||||||||||
Price Per Unit | $ | 65,625 | $ | 68,571 | $ | 182,708 | $ | 83,333 | $ | 157,859 | ||||||||||
Price Per SF | $ | 75.00 | $ | 103.46 | $ | 202.28 | $ | 116.06 | $ | 215.74 |
COMPARABLE APARTMENT SALES MAP
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597920.gif)
Analysis of Apartment Sales | The comparables are examined by considering the following adjustment factors. | |
Ownership Interest | No adjustments are necessary, since all of the sales reflect a 100% transfer of ownership interest. | |
Financing Terms | The comparable sales were either all cash transactions or were financed by primary lenders at market-oriented rates. Considerate of such, no adjustments for any unusual or atypical financing is required. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 90 |
Conditions of Sale | Adjustments for conditions of sale usually reflect the motivations of the buyer and the seller. We are not aware of any atypical circumstances regarding any of the comparable sales. Personal property is included as all facilities have similar unit appliance requirements and miscellaneous office and common area FF&E. | |
Expenditures Made Immediately After Sale | Any required major capital costs incurred by the buyer immediately after the sale is appropriately added to the purchase price. None of the sales required any specific sale price adjustment other than what is included in general comparisons based on condition. | |
Market Conditions (Time) | Comparable sales that occurred under different market conditions than those applicable to the subject property as of the effective date of appraisal require adjustment for any differences that affect their values. The sales occurred between September 2008 and December 2009. | |
Market conditions began to deteriorate in approximately mid-year 2008 in response to weakness that was becoming pronounced in the regional and national economies. Market fundamentals remain soft at this time however beginning at approximately the 3rd quarter 2009 the general trend of deterioration appears to be moderating. | ||
Given the moderation being realized in deteriorating market fundamentals within recent months, a moderate downward adjustment is applied to the oldest transaction, Sale #5. No adjustment is warranted to the more recent transactions. | ||
Location | The comparable properties are located throughout the central eastern area that incorporates the New York, Philadelphia, and Washington, DC metropolitan markets. Differences may exist to slight variations in apartment submarket conditions and demographic profiles. However, the major difference between the data set is whether the property is situated in a suburban setting or downtown urban location. | |
Sales #1, #2 and #3 are suburban apartment buildings that are not immediately proximate to employment, shopping and entertainment venues. These transactions were adjusted upward to account for their inferior location in comparison to the subject’s within the core business area of Philadelphia, PA. Sale #3 is located in the Harlem neighborhood of New York City. In general, this comparable is central to New York City and the locational advantages afforded. This transaction is adjusted downward for superior locational considerations. No adjustment to Sale #5 is warranted for location. | ||
Physical Characteristics | Physical differences include differences in building size, quality of construction, building materials, age, condition, functional utility and appearance. All of the comparable properties are generally similar to the subject in terms of age and overall physical condition. However, all of the sales are significantly smaller in rentable area and building height (stories). High rise properties are typically more expensive to build than low-rise |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 91 |
structures; accordingly, we have adjusted the sale price for building height. In addition, the subject property has a rentable area of 517,490 square feet (535 units). The five comparables are significantly smaller in size ranging 108,390 to 270,000 square feet, and 120 to 369 units. Due to the economies of scale, we have adjusted the individual sale prices for smaller property size. | ||
Average Unit Size | The subject has an average unit size of 967 square feet. Properties with larger average unit sizes tend to trade at higher prices, all other factors being equal. Conversely, properties with smaller average unit sizes tend to trade at a lower price per unit. The average unit size of each comparable property is compared to the subject and applicable adjustments are applied when warranted. | |
Amenities | The subject offers a community and unit amenity package that is typical for a Class A high-rise apartment property. All of the transactions are considered to offer a generally similar amenity package as the subject and no adjustment for this factor is warranted. | |
Economic Characteristics | Economic characteristics include all the attributes of a property that affect its income. All of the sales were operating at stabilized occupancy and at market rents. As such, no adjustment was applied. The preceding adjustments are summarized in the following chart. |
COMPARABLE APARTMENT SALES ADJUSTMENT GRID
Sale No. | 1 | 2 | 3 | 4 | 5 | |||||||||||||||
Name | Beechwood Gardens | Newport Vllage | 1420 Fifth | Avondale | The Kenmore | |||||||||||||||
Address | 9805 Haldeman | 8590 New Falls | 1420 5th Avenue | 8301 Ashford. | 5415 Connecticut | |||||||||||||||
Philadelphia, PA | Falls Township, PA | New York, NY | Laurel, MD | Washington, DC | ||||||||||||||||
Sale Date | 12/16/2009 | 6/22/2009 | 9/29/2009 | 5/13/2009 | 9/3/2008 | |||||||||||||||
Price per Unit | $ | 65,625 | $ | 68,571 | $ | 182,708 | $ | 83,333 | $ | 157,859 | ||||||||||
ADJUSTMENTS | ||||||||||||||||||||
Financing Adjustment | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||
Adjusted for Financing per Unit | $ | 65,625 | $ | 68,571 | $ | 182,708 | $ | 83,333 | $ | 157,859 | ||||||||||
Conditions of Sale Adjustment | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||
Adjusted for Special Conditions | $ | 65,625 | $ | 68,571 | $ | 182,708 | $ | 83,333 | $ | 157,859 | ||||||||||
Time | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | -5.00 | % | ||||||||||
Time Adjusted Price per Unit | $ | 65,625 | $ | 68,571 | $ | 182,708 | $ | 83,333 | $ | 149,966 | ||||||||||
Location | 20 | % | 20 | % | -10 | % | 10 | % | -10 | % | ||||||||||
Physical Characteristics | 40 | % | 35 | % | 10 | % | 25 | % | 5 | % | ||||||||||
Average Unit Size | 10 | % | 20 | % | 0 | % | 15 | % | 15 | % | ||||||||||
Amenities | 0 | % | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||||
Economics | 0 | % | 0 | % | -5 | % | 0 | % | 0 | % | ||||||||||
Total Adjustments (%) | 70 | % | 75 | % | -5 | % | 50 | % | 10 | % | ||||||||||
Adjusted Price per Unit | $ | 111,563 | $ | 120,000 | $ | 173,573 | $ | 125,000 | $ | 164,963 |
Value Conclusion– Residential Component | After analysis and adjustments, a value range of $111,563 to $173,573 per unit is indicated. The mean and median adjusted sales prices equate to $139,020 and $125,000 per unit. Sales #3 and #5 required the least adjustment and are accorded most significance in this analysis. The adjusted indicators exhibited by these sales range from $164,963 to $173,573 per unit. When tempered against the indicators exhibited by the |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 92 |
remaining sales, a value indication in the range of approximately $150,000 to $160,000 per unit is indicated. A value of $155,000 per unit is concluded for the residential component at the subject property. | ||
535 units x $155,000 per unit = $82,925,000, or $82,900,000 rounded | ||
Applying this value to the stabilized Effective Gross Income derived for the property within the Capitalization Approach section, results in an indicated EGIM of approximately 8.3 on a stabilized basis. This indicated EGIM is within the range of 5.5 to 9.6 produced by the sales data under analysis. This indicator suggests that the value concluded for the property via comparative analysis is reasonable based on the subject property’s income-producing characteristics. | ||
COMMERCIAL SALES OVERVIEW | As previously indicated, only a limited amount of recent sales data is available from the local market. Our research identified the following four transactions for office and retail properties in the metropolitan Philadelphia area. These sales are considered adequate to formulate a defensible value for the commercial component of the subject property via sales comparison. | |
Presentation of Comparable Sales | To estimate the property value by the sales comparison approach, we analyzed sales from the influencing market that are most similar to the subject property in terms of age, size, tenant profile and location. The sales are compared on a price-per square foot basis, as this is a common method of comparison for such properties. | |
The comparable sales summarized in the chart below and plotted on the following map, range in price from $76.22 to $100.59 per square foot. While these unit prices implicitly contain both the physical and economic factors affecting real estate, these statistics do not explicitly convey many of the details surrounding a specific property. Thus, this single index to the valuation of the subject property has some limitations. |
PRESENTATION OF COMPARABLE COMMERCIAL SALES DATA
Project Name | 2000 Market | Jenkintown Plaza | 410 Huntingdon | Erie Plaza | ||||||||||||
Sale No. | 1 | 2 | 3 | 4 | ||||||||||||
Address | 2000 Market | 101 Greenwood | 410 Huntingdon | 1240 E. Erie | ||||||||||||
Location | Philadelphia, PA | Jenkintown, PA | Jenkintown, PA | Philadelphia, PA | ||||||||||||
Type | High Rise Office | Mid-Rise Office | Community Retail | Strip Retail | ||||||||||||
Grantor | Prudential RE | Ajax Jenkintown | Ackers | Erie Plaza Partners | ||||||||||||
Grantee | US Value 5 Fund | ISU Properties | Good Rock Realty | N/A | ||||||||||||
Sale Price | $ | 56,000,000 | $ | 8,800,000 | $ | 3,175,000 | $ | 3,462,500 | ||||||||
Date of Sale | December-09 | September-08 | July-09 | February-09 | ||||||||||||
Year Built | 1973 | 1968 | 1970 | 1978 | ||||||||||||
Net Rentable Area (NRA) | 665,000 | 100,000 | 41,654 | 34,422 | ||||||||||||
Price Per SF | $ | 84.21 | $ | 88.00 | $ | 76.22 | $ | 100.59 |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 93 |
COMPARABLE COMMERCIAL SALES MAP
![(MAP)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597921.gif)
Analysis of Commercial Sales | The comparables are examined by considering the following adjustment factors. | |
Ownership Interest | No adjustments are necessary, since all of the sales reflect a 100% transfer of ownership interest. | |
Financing Terms | The comparable sales were either all cash transactions or were financed by primary lenders at market-oriented rates. Considerate of such, no adjustments for any unusual or atypical financing is required. | |
Conditions of Sale | Adjustments for conditions of sale usually reflect the motivations of the buyer and the seller. We are not aware of any atypical circumstances regarding any of the comparable sales. | |
Expenditures Made Immediately After Sale | Any required major capital costs incurred by the buyer immediately after the sale is appropriately added to the purchase price. None of the sales required any specific sale price adjustment other than what is included in general comparisons based on condition. | |
Market Conditions (Time) | Comparable sales that occurred under different market conditions than those applicable to the subject property as of the effective date of appraisal require adjustment for any differences that affect their values. The sales occurred in the past 12 months |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 94 |
Market conditions began to deteriorate in approximately mid-year 2008 in response to weakness that was becoming pronounced in the regional and national economies. Market fundamentals remain soft at this time however beginning at approximately the 3rd quarter 2009 the general trend of deterioration appears to be moderating. | ||
Given the date of sale of the transactions, no adjustment for market conditions is warranted. | ||
Location | The comparable properties are located throughout the metropolitan Philadelphia region. Sale #1 is located within the City Center district, approximately two blocks west of the subject property. No adjustment for location is warranted. The remaining sales are suburban locations in the northern sectors of Philadelphia. The major difference between the data set is suburban versus downtown location. Sale #2, #3 and #4 are suburban commercial buildings and do not offer the proximity to employment, regional transportation linkages, and shopping and entertainment venues that the subject offers. These transactions were adjusted upward for their inferior location with respect to the subject’s within the core business area of Philadelphia. | |
Physical Characteristics | Physical differences include differences in building size, quality of construction, building materials, age, condition, functional utility and appearance. All of the comparable properties are generally similar to the subject in terms of age and overall physical condition. However, adjustment for building size and height is warranted. High rise properties are typically more expensive to build than low-rise structures; accordingly, we have adjusted the sale price for building height. In addition, the subject commercial component has a rentable area of 115,550 square feet. Sale #1 is significantly larger in size while Sale #3 and #4 are smaller. We have adjusted the sale price accordingly for these differences. | |
Economic Characteristics | Economic characteristics include all the attributes of a property that affect its income. All of the sales were operating at stabilized occupancy and at market rates. As such, no adjustment was applied. | |
The preceding adjustments are summarized in the following chart. |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 95 |
COMPARABLE COMMERCIA L SALES ADJUSTMENT GRID
Sale No. | 1 | 2 | 3 | 4 | ||||||||||||
Name | 2000 Market | Jenkintown Plaza | 410 Huntingdon | Erie Plaza | ||||||||||||
Address | 2000 Market | 101 Greenwood | 410 Huntingdon | 1240 E. Erie | ||||||||||||
Philadelphia, PA | Jenkintown, PA | Jenkintown, PA | Philadelphia, PA | |||||||||||||
Sale Date | Dec-09 | Sep-08 | Jul-09 | Feb-09 | ||||||||||||
Price per SF | $ | 84.21 | $ | 88.00 | $ | 76.22 | $ | 100.59 | ||||||||
ADJUSTMENTS | ||||||||||||||||
Financing Adjustment | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||
Adjusted for Financing per Unit | $ | 84.21 | $ | 88.00 | $ | 76.22 | $ | 100.59 | ||||||||
Conditions of Sale Adjustment | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||
Adjusted for Special Conditions | $ | 84.21 | $ | 88.00 | $ | 76.22 | $ | 100.59 | ||||||||
Time | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | ||||||||
Time Adjusted Price per Unit | $ | 84.21 | $ | 88.00 | $ | 76.22 | $ | 100.59 | ||||||||
Location | 0 | % | 10 | % | 10 | % | 10 | % | ||||||||
Physical Characteristics | 15 | % | 0 | % | -10 | % | -10 | % | ||||||||
Economics | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
Total Adjustments (%) | 15 | % | 10 | % | 0 | % | 0 | % | ||||||||
Adjusted Price per Unit | $ | 96.84 | $ | 96.80 | $ | 76.22 | $ | 100.59 |
Value Conclusion — Commercial | After analysis and adjustments, a value range of $76.22 to $100.59 per square foot is indicated. The mean and median adjusted sales prices equate to $92.62 and $96.82 per square foot. Sales #1 is located in the downtown area of Philadelphia, just blocks from the subject property. This sale is also one of the more recent transactions in the City Center district. This sale is accorded most significance in this analysis. The adjusted indicator exhibited by this sale is $96.84 per square foot. A value in the range of approximately $90.00 to $100.00 per square foot is indicated for the commercial component at the subject property. A final value of $95.00 per square foot is concluded for the subject property. | |
115,550 SF x $95.00 = $10,977,250, or $11,000,000 rounded | ||
The Sterling Aggregate Value Conclusion | The following is a summary of the value conclusions via the Sales Comparison Approach for the residential and commercial components which comprise the subject property. |
SUMMARY OF VALUE CONCLUSIONS
Residential Component | $ | 82,900,000 | ||
Commercial Component | $ | 11,00,0000 | ||
Total | $ | 93,900,000 | ||
The Market Value of the Leased Fee Interest in the subject property (The Sterling), free and clear of financing, via the Sales Comparison Approach, as of December 31, 2009, is: | ||
NINETY-THREE MILLION NINE HUNDRED THOUSAND DOLLARS ($93,900,000) |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Page 96 |
RECONCILIATION AND FINAL ESTIMATE OF VALUE | ||
Review | The purpose of this appraisal is to provide an estimate of the market value of the leased fee interest in the subject property, free and clear of financing. The date of value is December 31, 2009. The indicated market value estimates for the real property interest appraised are: |
Cost Approach | N/A | |||
Income Capitalization Approach | $ | 93,900,000 | ||
Sales Comparison Approach | $ | 93,900,000 |
Cost Approach | The cost approach value estimate relies on the cost to produce a like structure. The cost approach is not usually considered a reliable value indicator due to the fact that investors in the market area place minimal reliance on this approach because of the age of the property. The cost approach was not included within the scope of this appraisal. | |
Income Approach | The Income Capitalization Approach was processed. The subject is an income-producing property, and this approach provides good evidence of market value. Both the Discounted Cash Flow and Direct Capitalization methods were employed. Based on the applicable analytical methods of the most likely investors in an asset of this type, the Discounted Cash Flow method was given greatest consideration in the conclusion of value for this approach. It is similarly given greatest consideration in the final conclusion of market value. | |
Sales Approach | This approach provides an estimate of value based upon the recent activities of buyers and sellers in the marketplace. This approach is generally considered to be reliable in active markets where the motivations of buyers and sellers are known and the operating characteristics of the properties being transferred are available for scrutiny. Our market research revealed several sales of properties that are considered comparable to the subject property, however, the velocity of sales activity has diminished significantly over the past year. Given the paucity of recent sales, the reliability of the Sales Comparison Approach is diminished. The results of the Sales Comparison Approach are given secondary consideration to the value produced via Income Capitalization. The value conclusion derived via this approach however is supportive of that concluded via the Income Approach. | |
Conclusions | Based upon the data, analyses and conclusions contained within this appraisal report with emphasis placed on the methodology of the Income Capitalization Approach, the Market Value of the Leased Fee Interest in the subject property, free and clear of financing, as of December 31, 2009 is: | |
NINETY-THREE MILLION NINE HUNDRED THOUSAND DOLLARS ($93,900,000) |
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
ADDENDA
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
ADDITIONAL SUBJECT PROPERTY PHOTOGRAPHS
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597922.gif)
JFK Boulevard Street Frontage
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597923.gif)
Culbeth Street Frontage
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597924.gif)
Residential Lobby
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597925.gif)
Residential Hallway/Elevator Bank
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597926.gif)
Typical Residential Unit Living Area
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597927.gif)
Typical Kitchen
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597928.gif)
Residential Lobby Elevator Bank
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597929.gif)
JBK Boulevard Retail Storefronts
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597930.gif)
Office Lobby Area
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597931.gif)
Typical Office Space
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
SUBJECT PROPERTY PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597932.gif)
Office Common Hallway
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597933.gif)
Roof Top Pool
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
IMPROVED SALES PHOTOGRAPHS
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
IMPROVED SALES PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597934.gif)
Beechwood Gardens Apartments
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597935.gif)
Newport Village Apartments
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
IMPROVED SALES PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597936.gif)
1420 Fifth Apartments
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597937.gif)
The Ashford Apartments
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
IMPROVED SALES PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597938.gif)
The Kenmore
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597939.gif)
2000 Market Street
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
IMPROVED SALES PHOTOGRAPHS
![(IMAGE)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597940.gif)
Jenkintown Plaza
COGENT Realty Advisors, LLC
The Sterling | February 22, 2010 | |
Philadelphia, Pennsylvania | Addenda |
ARGUS SUPPORTING MATERIAL
COGENT Realty Advisors, LLC
![]() | The Sterling Commercial | Software : ARGUS Ver. 14.0.2 | ||
1801 JFK Boulevard | File : The Sterling Commercial (1) | |||
Philadelphia, PA | Property Type : Office & Retail | |||
Portfolio : | ||||
Date : 3/3/10 | ||||
Time : 11:15 am | ||||
Ref# : ARL | ||||
Page : 1 |
Supporting Schedule — Detailed Lease Expiration Schedule (First Term Only)
Market | Base Rent | Expiration | Percent of | |||||||||||||||||||||||||
No. | Tenant | Suite | Leasing | /SqFt/Yr | Date | Square Feet | Total | |||||||||||||||||||||
25 | City Nails | 1823 | Retail 1 | 11.07 | 3/10 | 1,085.00 | 0.9 | |||||||||||||||||||||
27 | Subway | 1827 | Retail 1 | 18.81 | 3/10 | 898.00 | 0.8 | |||||||||||||||||||||
9 | Michael Kleeman | 350 | Office 1 | 6.84 | 6/10 | 3,505.00 | 3.0 | |||||||||||||||||||||
12 | Joel Oshtry, Esq. | 433 | Office 1 | 6.67 | 6/10 | 1,588.00 | 1.4 | |||||||||||||||||||||
28 | JFK Dental | 1829 | Retail 1 | 9.90 | 6/10 | 2,588.00 | 2.2 | |||||||||||||||||||||
4 | Mid Atlantic Mortgage | 301 | Office 1 | 12.46 | 9/10 | 1,896.00 | 1.6 | |||||||||||||||||||||
1 | Devereux Foundation | 200 | Office 1 | 12.64 | 10/10 | 19,982.00 | 17.3 | |||||||||||||||||||||
6 | Contemporary Staffing | 307 | Office 1 | 15.23 | 11/10 | 1,500.00 | 1.3 | |||||||||||||||||||||
10 | Wainstein, Yanks & Co | 400 | Office 1 | 16.01 | 12/10 | 3,287.00 | 2.8 | |||||||||||||||||||||
Total for Year Ending Dec- | 36,329.00 | 31.4 | % | |||||||||||||||||||||||||
2 | Caring People Allianc | 220 | Office 1 | 8.75 | 3/11 | 7,252.00 | 6.3 | |||||||||||||||||||||
17 | Robert Cole PC | 465 | Office 1 | 9.12 | 3/11 | 572.00 | 0.5 | |||||||||||||||||||||
20 | Hwa Yuan Restaurant | 1801 | Retail 1 | 16.41 | 6/11 | 3,800.00 | 3.3 | |||||||||||||||||||||
30 | 7-Eleven Store | 1833 | Retail 1 | 31.95 | 11/11 | 3,042.00 | 2.6 | |||||||||||||||||||||
Total for Year Ending Dec- | 14,666.00 | 12.7 | % | |||||||||||||||||||||||||
8 | Equitrac Corporation | 340 | Office 1 | 9.26 | 1/13 | 3,052.00 | 2.6 | |||||||||||||||||||||
18 | Public House Investme | 475 | Office 1 | 9.27 | 3/13 | 646.00 | 0.6 | |||||||||||||||||||||
19 | Public House Investme | 480 | Office 1 | 9.15 | 3/13 | 1,475.00 | 1.3 | |||||||||||||||||||||
13 | Bayada Nurses | 444 | Office 1 | 12.91 | 8/13 | 2,609.00 | 2.3 | |||||||||||||||||||||
31 | Central Parking | Garage | Garage Park | 230,653.58 | 8/13 | 1.00 | ||||||||||||||||||||||
Total for Year Ending Dec- | 7,783.00 | 6.7 | % | |||||||||||||||||||||||||
11 | Cornerstone Consultan | 424A | Office 1 | 9.82 | 1/14 | 1,217.00 | 1.1 | |||||||||||||||||||||
21 | K Shoe Repair | 1803 | Retail 1 | 13.62 | 1/14 | 186.00 | 0.2 | |||||||||||||||||||||
16 | SOMA | 460 | Office 1 | 15.83 | 10/14 | 3,598.00 | 3.1 | |||||||||||||||||||||
7 | AIMCO Regional Office | 330 | Office 1 | 8.95 | 12/14 | 4,186.00 | 3.6 | |||||||||||||||||||||
Total for Year Ending Dec- | 9,187.00 | 8.0 | % | |||||||||||||||||||||||||
5 | Relief of Widows and | 303 | Office 1 | 9.97 | 5/15 | 1,165.00 | 1.0 | |||||||||||||||||||||
32 | Vacant Space | Qtr 2 | Office 1 | 8.93 | 5/15 | 2,253.45 | 2.0 | |||||||||||||||||||||
33 | Vacant Space | Qtr 3 | Office 1 | 11.67 | 8/15 | 2,253.46 | 2.0 | |||||||||||||||||||||
26 | Vacant Retail | 1825 | Retail 1 | 22.50 | 9/15 | 2,895.00 | 2.5 | |||||||||||||||||||||
34 | Vacant Space | Qtr 4 | Office 1 | 16.04 | 11/15 | 2,253.45 | 2.0 | |||||||||||||||||||||
Total for Year Ending Dec- | 10,820.36 | 9.4 | % | |||||||||||||||||||||||||
35 | Vacant Space | Qtr 5 | Office 1 | 9.68 | 2/16 | 2,253.46 | 2.0 | |||||||||||||||||||||
36 | Vacant Space | Qtr 6 | Office 1 | 8.98 | 5/16 | 2,253.45 | 2.0 | |||||||||||||||||||||
37 | Vacant Space | Qtr 7 | Office 1 | 11.67 | 8/16 | 2,253.46 | 2.0 | |||||||||||||||||||||
38 | Vacant Space | Qtr 8 | Office 1 | 16.04 | 11/16 | 2,253.45 | 2.0 | |||||||||||||||||||||
Total for Year Ending Dec- | 9,013.82 | 7.8 | % | |||||||||||||||||||||||||
39 | Vacant Space | Qtr 9 | Office 1 | 9.97 | 2/17 | 2,253.46 | 2.0 | |||||||||||||||||||||
40 | Vacant Space | Qtr 10 | Office 1 | 9.25 | 5/17 | 2,253.45 | 2.0 | |||||||||||||||||||||
41 | Vacant Space | Qtr 11 | Office 1 | 12.02 | 8/17 | 2,253.46 | 2.0 | |||||||||||||||||||||
42 | Vacant Space | Qtr 12 | Office 1 | 16.52 | 11/17 | 2,253.45 | 2.0 | |||||||||||||||||||||
3 | WB Mason | 230 | Office 1 | 19.95 | 12/17 | 7,993.00 | 6.9 | |||||||||||||||||||||
23 | Trumark Financial Cre | 1811 | Retail 1 | 43.76 | 12/17 | 3,766.00 | 3.3 | |||||||||||||||||||||
Total for Year Ending Dec- | 20,772.82 | 18.0 | % |
(continued on next page)
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 2 |
Supporting Schedule — Detailed Lease Expiration Schedule (First Term Only)
Market | Base Rent | Expiration | Percent of | |||||||||||||||||||||||||
No. | Tenant | Suite | Leasing | /SqFt/Yr | Date | Square Feet | Total | |||||||||||||||||||||
29 | Young’s Tailor and Cl | 1831 | Retail 1 | 26.12 | 11/18 | 1,195.00 | 1.0 | |||||||||||||||||||||
Total for Year Ending Dec- | 1,195.00 | 1.0 | % | |||||||||||||||||||||||||
22 | Hot Tamales | 1805 | Retail 1 | 14.85 | 1/19 | 1,414.00 | 1.2 | |||||||||||||||||||||
Total for Year Ending Dec- | 1,414.00 | 1.2 | % | |||||||||||||||||||||||||
Building Total | 111,181.00 | 96.2 | % |
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 3 |
Supporting Schedule — Square Feet Expiring — (All Terms)
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 1,085.00 | 1,085.00 | ||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 898.00 | 898.00 | ||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 3,505.00 | 3,505.00 | ||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 1,588.00 | 1,588.00 | ||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 2,588.00 | 2,588.00 | ||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 1,896.00 | 1,896.00 | ||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 19,982.00 | 19,982.00 | ||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 1,500.00 | 1,500.00 | ||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 3,287.00 | 3,287.00 | ||||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 7,252.00 | 7,252.00 | ||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 572.00 | 572.00 | ||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 3,800.00 | 3,800.00 | ||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 3,042.00 | 3,042.00 | ||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 3,052.00 | 3,052.00 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 646.00 | 646.00 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 1,475.00 | 1,475.00 | ||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 2,609.00 | 2,609.00 | ||||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 1.00 | |||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 1,217.00 | |||||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 186.00 | |||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 3,598.00 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 4,186.00 | |||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,165.00 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 2,895.00 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 7,993.00 | |||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 3,766.00 | |||||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 1,195.00 | |||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Total SqFt Expiring | 83,498.00 | 36,329.00 | 14,666.00 | 7,783.00 | 9,187.00 | 22,380.36 | 45,406.82 | 23,814.82 | 8,977.00 | |||||||||||||||||||||||||||||||||||||||||
Percent Of Total Expiring | 31.4 | % | 12.7 | % | 6.7 | % | 8.0 | % | 19.4 | % | 39.3 | % | 20.6 | % | 7.8 | % |
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 4 |
Supporting Schedule — Square Feet Expiring — (All Terms)
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | |||||||||||||||||
Tenant | Suite | |||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 1,085.00 | |||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 898.00 | |||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 3,505.00 | |||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 1,588.00 | |||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 2,588.00 | |||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | ||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | ||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | ||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | ||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | ||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | ||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | ||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | ||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | ||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | ||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | ||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | ||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 1,217.00 | |||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 186.00 | |||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 3,598.00 | |||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 4,186.00 | |||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,165.00 | |||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 2,253.45 | ||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 2,253.46 | ||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 2,895.00 | ||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | |||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | |||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | |||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | |||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | |||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | |||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | |||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | |||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | |||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | ||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | ||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 1,414.00 | |||||||||||||||||
Total SqFt Expiring | 83,498.00 | 2,817.00 | 26,014.91 | |||||||||||||||||||
Percent Of Total Expiring | 2.4 | % | 22.5 | % |
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 5 |
Supporting Schedule — Occupancy & Absorption Rates
Physical Occupancy Based on Absorption & Turnover Vacancy Assumptions
Physical Occupancy Based on Absorption & Turnover Vacancy Assumptions
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | Year 11 | ||||||||||||||||||||||||||||||||||
For the Years Ending | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | Dec-2019 | Dec-2020 | |||||||||||||||||||||||||||||||||
SqFt Occupied | ||||||||||||||||||||||||||||||||||||||||||||
January | 87,868.00 | 72,754.36 | 103,495.18 | 115,551.00 | 115,551.00 | 107,767.00 | 111,401.55 | 113,297.55 | 101,538.55 | 111,747.00 | 115,551.00 | |||||||||||||||||||||||||||||||||
February | 87,868.00 | 92,736.36 | 103,495.18 | 112,499.00 | 114,148.00 | 111,365.00 | 91,419.55 | 113,297.55 | 101,538.55 | 110,333.00 | 111,953.00 | |||||||||||||||||||||||||||||||||
March | 87,868.00 | 96,489.82 | 108,790.64 | 112,499.00 | 114,148.00 | 111,365.00 | 89,919.54 | 110,255.54 | 103,792.00 | 114,137.00 | 111,953.00 | |||||||||||||||||||||||||||||||||
April | 86,783.00 | 91,952.82 | 108,790.64 | 110,378.00 | 114,148.00 | 114,653.00 | 88,528.54 | 110,255.54 | 115,551.00 | 114,137.00 | 107,767.00 | |||||||||||||||||||||||||||||||||
May | 86,783.00 | 91,952.82 | 108,790.64 | 113,430.00 | 115,551.00 | 114,653.00 | 108,510.54 | 110,255.54 | 112,499.00 | 114,148.00 | 111,365.00 | |||||||||||||||||||||||||||||||||
June | 89,036.45 | 94,206.27 | 111,044.09 | 113,430.00 | 115,551.00 | 111,234.55 | 110,010.55 | 113,297.55 | 112,499.00 | 114,148.00 | 111,365.00 | |||||||||||||||||||||||||||||||||
July | 82,440.45 | 98,230.27 | 111,044.09 | 115,551.00 | 115,551.00 | 111,047.55 | 105,473.55 | 113,297.55 | 110,378.00 | 114,148.00 | 114,653.00 | |||||||||||||||||||||||||||||||||
August | 82,440.45 | 98,230.27 | 111,044.09 | 115,551.00 | 115,551.00 | 111,047.55 | 105,473.55 | 113,297.55 | 113,430.00 | 115,551.00 | 114,653.00 | |||||||||||||||||||||||||||||||||
September | 84,693.91 | 100,483.73 | 113,297.55 | 112,942.00 | 115,551.00 | 112,212.54 | 105,473.54 | 113,297.54 | 113,430.00 | 115,551.00 | 111,234.55 | |||||||||||||||||||||||||||||||||
October | 93,373.91 | 104,283.73 | 113,297.55 | 112,942.00 | 115,551.00 | 102,721.54 | 109,497.54 | 113,297.54 | 115,551.00 | 115,551.00 | 111,047.55 | |||||||||||||||||||||||||||||||||
November | 73,391.91 | 104,283.73 | 113,297.55 | 112,942.00 | 111,953.00 | 102,721.54 | 109,497.54 | 113,297.54 | 115,551.00 | 115,551.00 | 111,047.55 | |||||||||||||||||||||||||||||||||
December | 74,145.36 | 103,495.18 | 115,551.00 | 115,551.00 | 111,953.00 | 102,721.55 | 109,497.55 | 113,297.55 | 111,747.00 | 115,551.00 | 112,212.54 | |||||||||||||||||||||||||||||||||
Average Occupied For The Year | 84,724.37 | 95,758.28 | 110,161.52 | 113,605.50 | 114,600.58 | 109,459.15 | 103,725.30 | 112,537.05 | 110,625.43 | 114,212.75 | 112,066.85 | |||||||||||||||||||||||||||||||||
Net Absorption | ||||||||||||||||||||||||||||||||||||||||||||
Annual Square Feet Absorbed | (13,722.64 | ) | 29,349.82 | 12,055.82 | (3,598.00 | ) | (9,231.45 | ) | 6,776.00 | 3,800.00 | (1,550.55 | ) | 3,804.00 | (3,338.46 | ) | |||||||||||||||||||||||||||||
Average Monthly Absorption | (1,143.55 | ) | 2,445.82 | 1,004.65 | (299.83 | ) | (769.29 | ) | 564.67 | 316.67 | (129.21 | ) | 317.00 | (278.21 | ) | |||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | Year 11 | ||||||||||||||||||||||||||||||||||
For the Years Ending | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | Dec-2019 | Dec-2020 | |||||||||||||||||||||||||||||||||
Percentage Occupancy | ||||||||||||||||||||||||||||||||||||||||||||
January | 76.04 | % | 62.96 | % | 89.57 | % | 100.00 | % | 100.00 | % | 93.26 | % | 96.41 | % | 98.05 | % | 87.87 | % | 96.71 | % | 100.00 | % | ||||||||||||||||||||||
February | 76.04 | % | 80.26 | % | 89.57 | % | 97.36 | % | 98.79 | % | 96.38 | % | 79.12 | % | 98.05 | % | 87.87 | % | 95.48 | % | 96.89 | % | ||||||||||||||||||||||
March | 76.04 | % | 83.50 | % | 94.15 | % | 97.36 | % | 98.79 | % | 96.38 | % | 77.82 | % | 95.42 | % | 89.82 | % | 98.78 | % | 96.89 | % | ||||||||||||||||||||||
April | 75.10 | % | 79.58 | % | 94.15 | % | 95.52 | % | 98.79 | % | 99.22 | % | 76.61 | % | 95.42 | % | 100.00 | % | 98.78 | % | 93.26 | % | ||||||||||||||||||||||
May | 75.10 | % | 79.58 | % | 94.15 | % | 98.16 | % | 100.00 | % | 99.22 | % | 93.91 | % | 95.42 | % | 97.36 | % | 98.79 | % | 96.38 | % | ||||||||||||||||||||||
June | 77.05 | % | 81.53 | % | 96.10 | % | 98.16 | % | 100.00 | % | 96.26 | % | 95.21 | % | 98.05 | % | 97.36 | % | 98.79 | % | 96.38 | % | ||||||||||||||||||||||
July | 71.35 | % | 85.01 | % | 96.10 | % | 100.00 | % | 100.00 | % | 96.10 | % | 91.28 | % | 98.05 | % | 95.52 | % | 98.79 | % | 99.22 | % | ||||||||||||||||||||||
August | 71.35 | % | 85.01 | % | 96.10 | % | 100.00 | % | 100.00 | % | 96.10 | % | 91.28 | % | 98.05 | % | 98.16 | % | 100.00 | % | 99.22 | % | ||||||||||||||||||||||
September | 73.30 | % | 86.96 | % | 98.05 | % | 97.74 | % | 100.00 | % | 97.11 | % | 91.28 | % | 98.05 | % | 98.16 | % | 100.00 | % | 96.26 | % | ||||||||||||||||||||||
October | 80.81 | % | 90.25 | % | 98.05 | % | 97.74 | % | 100.00 | % | 88.90 | % | 94.76 | % | 98.05 | % | 100.00 | % | 100.00 | % | 96.10 | % | ||||||||||||||||||||||
November | 63.51 | % | 90.25 | % | 98.05 | % | 97.74 | % | 96.89 | % | 88.90 | % | 94.76 | % | 98.05 | % | 100.00 | % | 100.00 | % | 96.10 | % | ||||||||||||||||||||||
December | 64.17 | % | 89.57 | % | 100.00 | % | 100.00 | % | 96.89 | % | 88.90 | % | 94.76 | % | 98.05 | % | 96.71 | % | 100.00 | % | 97.11 | % | ||||||||||||||||||||||
Average Occupancy For The Year | 73.32 | % | 82.87 | % | 95.34 | % | 98.32 | % | 99.18 | % | 94.73 | % | 89.77 | % | 97.39 | % | 95.74 | % | 98.84 | % | 96.98 | % | ||||||||||||||||||||||
Net Absorption | ||||||||||||||||||||||||||||||||||||||||||||
Annual Percentage Absorbed | (11.88 | %) | 25.40 | % | 10.43 | % | (3.11 | %) | (7.99 | %) | 5.86 | % | 3.29 | % | (1.34 | %) | 3.29 | % | (2.89 | %) | ||||||||||||||||||||||||
Average Monthly Percentage | (0.99 | %) | 2.12 | % | 0.87 | % | (0.26 | %) | (0.67 | %) | 0.49 | % | 0.27 | % | (0.11 | %) | 0.27 | % | (0.24 | %) | ||||||||||||||||||||||||
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 6 |
Supporting Schedule — Average Square Feet Occupancy
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 16,651.67 | 18,316.83 | 19,982.00 | 19,982.00 | 19,982.00 | 19,982.00 | 14,986.50 | 19,982.00 | 19,982.00 | |||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 7,252.00 | 5,439.00 | 7,252.00 | 7,252.00 | 7,252.00 | 7,252.00 | 5,439.00 | 7,252.00 | 7,252.00 | |||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 7,993.00 | 7,993.00 | 7,993.00 | 7,993.00 | 7,993.00 | 7,993.00 | 7,993.00 | 7,993.00 | 5,994.75 | |||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 1,422.00 | 1,896.00 | 1,896.00 | 1,896.00 | 1,896.00 | 1,896.00 | 1,422.00 | 1,896.00 | 1,896.00 | |||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,165.00 | 1,165.00 | 1,165.00 | 1,165.00 | 1,165.00 | 873.75 | 1,165.00 | 1,165.00 | 1,165.00 | |||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 1,375.00 | 1,250.00 | 1,500.00 | 1,500.00 | 1,500.00 | 1,500.00 | 1,125.00 | 1,500.00 | 1,500.00 | |||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 4,186.00 | 4,186.00 | 4,186.00 | 4,186.00 | 4,186.00 | 3,139.50 | 4,186.00 | 4,186.00 | 4,186.00 | |||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 3,052.00 | 3,052.00 | 3,052.00 | 2,289.00 | 3,052.00 | 3,052.00 | 3,052.00 | 3,052.00 | 2,289.00 | |||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 2,628.75 | 3,505.00 | 3,505.00 | 3,505.00 | 3,505.00 | 2,628.75 | 3,505.00 | 3,505.00 | 3,505.00 | |||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 3,287.00 | 2,465.25 | 3,287.00 | 3,287.00 | 3,287.00 | 3,287.00 | 2,465.25 | 3,287.00 | 3,287.00 | |||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 1,217.00 | 1,217.00 | 1,217.00 | 1,217.00 | 912.75 | 1,217.00 | 1,217.00 | 1,217.00 | 1,217.00 | |||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 1,191.00 | 1,588.00 | 1,588.00 | 1,588.00 | 1,588.00 | 1,191.00 | 1,588.00 | 1,588.00 | 1,588.00 | |||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 2,609.00 | 2,609.00 | 2,609.00 | 1,956.75 | 2,609.00 | 2,609.00 | 2,609.00 | 2,609.00 | 2,391.58 | |||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | 1,399.00 | |||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | 966.00 | 966.00 | 966.00 | 966.00 | 966.00 | 966.00 | 966.00 | 966.00 | 966.00 | |||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 3,598.00 | 3,598.00 | 3,598.00 | 3,598.00 | 2,998.33 | 3,298.17 | 3,598.00 | 3,598.00 | 3,598.00 | |||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 572.00 | 429.00 | 572.00 | 572.00 | 572.00 | 572.00 | 429.00 | 572.00 | 572.00 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 646.00 | 646.00 | 646.00 | 484.50 | 646.00 | 646.00 | 646.00 | 646.00 | 484.50 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 1,475.00 | 1,475.00 | 1,475.00 | 1,106.25 | 1,475.00 | 1,475.00 | 1,475.00 | 1,475.00 | 1,106.25 | |||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 3,800.00 | 2,850.00 | 3,800.00 | 3,800.00 | 3,800.00 | 3,800.00 | 2,850.00 | 3,800.00 | 3,800.00 | |||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 186.00 | 186.00 | 186.00 | 186.00 | 139.50 | 186.00 | 186.00 | 186.00 | 186.00 | |||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | 1,414.00 | |||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 3,766.00 | 3,766.00 | 3,766.00 | 3,766.00 | 3,766.00 | 3,766.00 | 3,766.00 | 3,766.00 | 2,824.50 | |||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | 2,005.00 | |||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 813.75 | 1,085.00 | 1,085.00 | 1,085.00 | 1,085.00 | 813.75 | 1,085.00 | 1,085.00 | 1,085.00 | |||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 723.75 | 2,895.00 | 2,895.00 | 2,895.00 | 2,895.00 | 2,171.25 | 2,895.00 | 2,895.00 | 2,895.00 | ||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 898.00 | 898.00 | 898.00 | 898.00 | 898.00 | 673.50 | 898.00 | 898.00 | 898.00 | |||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 1,941.00 | 2,588.00 | 2,588.00 | 2,588.00 | 2,588.00 | 1,941.00 | 2,588.00 | 2,588.00 | 2,588.00 | |||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 1,195.00 | 1,195.00 | 1,195.00 | 1,195.00 | 1,195.00 | 1,195.00 | 1,195.00 | 1,195.00 | 1,095.42 | |||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 3,042.00 | 2,788.50 | 2,535.00 | 3,042.00 | 3,042.00 | 3,042.00 | 3,042.00 | 2,281.50 | 3,042.00 | |||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | |||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 1,314.51 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 1,690.09 | 2,253.45 | 2,253.45 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 751.15 | 2,253.46 | 2,253.46 | 2,253.46 | 2,253.46 | 1,690.10 | 2,253.46 | 2,253.46 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 187.79 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 2,065.66 | 1,877.88 | 2,253.45 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 1,877.88 | 2,253.46 | 2,253.46 | 2,253.46 | 2,253.46 | 1,690.10 | 2,253.46 | 2,253.46 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 1,314.51 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 1,690.09 | 2,253.45 | �� | 2,253.45 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 751.15 | 2,253.46 | 2,253.46 | 2,253.46 | 2,253.46 | 1,690.10 | 2,253.46 | 2,253.46 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 187.79 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 2,065.66 | 1,877.88 | 2,253.45 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 1,877.88 | 2,253.46 | 2,253.46 | 2,253.46 | 2,253.46 | 1,690.10 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 1,314.51 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 1,690.09 | 2,253.45 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 751.15 | 2,253.46 | 2,253.46 | 2,253.46 | 2,253.46 | 1,690.10 | 2,253.46 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 187.79 | 2,253.45 | 2,253.45 | 2,253.45 | 2,253.45 | 2,065.66 | 1,877.88 | ||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 84,724.37 | 95,758.27 | 110,161.51 | 113,605.50 | 114,600.58 | 109,459.16 | 103,725.31 | 112,537.06 | 110,625.43 | ||||||||||||||||||||||||||||||||||||||||
Average Percent Occupancy | 73.32 | % | 82.87 | % | 95.34 | % | 98.32 | % | 99.18 | % | 94.73 | % | 89.77 | % | 97.39 | % | 95.74 | % |
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 7 |
Supporting Schedule — Average Square Feet Occupancy
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | |||||||||||||||||
Tenant | Suite | |||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 19,982.00 | 19,982.00 | ||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 7,252.00 | 7,252.00 | ||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 7,993.00 | 7,993.00 | ||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 1,896.00 | 1,896.00 | ||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,165.00 | 873.75 | ||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 1,500.00 | 1,500.00 | ||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 4,186.00 | 3,139.50 | ||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 3,052.00 | 3,052.00 | ||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 3,505.00 | 3,505.00 | ||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 3,287.00 | 3,287.00 | ||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 912.75 | 1,217.00 | ||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 1,588.00 | 1,588.00 | ||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 2,174.17 | 2,609.00 | ||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | 1,399.00 | 1,399.00 | ||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | 966.00 | 966.00 | ||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 3,598.00 | 2,698.50 | ||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 572.00 | 572.00 | ||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 646.00 | 646.00 | ||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 1,475.00 | 1,475.00 | ||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 3,800.00 | 3,800.00 | ||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 139.50 | 186.00 | ||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 1,060.50 | 1,414.00 | ||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 3,766.00 | 3,766.00 | ||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | 2,005.00 | 2,005.00 | ||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 1,085.00 | 813.75 | ||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 2,895.00 | 2,895.00 | |||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 898.00 | 673.50 | ||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 2,588.00 | 2,588.00 | ||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 995.83 | 1,195.00 | ||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 3,042.00 | 3,042.00 | ||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 1.00 | 1.00 | ||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 2,253.45 | 1,690.09 | |||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 2,253.46 | 2,065.67 | |||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 2,253.45 | 2,253.45 | |||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 2,253.46 | 2,253.46 | |||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 2,253.45 | 2,253.45 | |||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 2,253.46 | 2,253.46 | |||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 2,253.45 | 2,253.45 | |||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 2,253.46 | 2,253.46 | |||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 2,253.45 | 2,253.45 | |||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 2,253.46 | 2,253.46 | |||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 2,253.45 | 2,253.45 | |||||||||||||||||
Total Amount Per Year | 87,868.00 | 114,212.75 | 112,066.85 | |||||||||||||||||||
Average Percent Occupancy | 98.84 | % | 96.98 | % |
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 8 |
Supporting Schedule — Scheduled Base Rental Revenue
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 252,606 | 233,123 | 349,685 | 349,685 | 349,685 | 349,685 | 198,049 | 405,381 | 405,381 | |||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 125,883 | 63,428 | 126,910 | 126,910 | 126,910 | 126,910 | 63,455 | 147,123 | 147,123 | |||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 132,102 | 136,014 | 139,926 | 143,838 | 147,750 | 151,671 | 155,586 | 159,498 | 86,016 | |||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 23,625 | 24,885 | 33,180 | 33,180 | 33,180 | 33,180 | 19,232 | 38,465 | 38,465 | |||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 20,727 | 21,310 | 21,892 | 22,475 | 23,057 | 11,621 | 22,946 | 22,946 | 22,946 | |||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 22,847 | 15,313 | 26,250 | 26,250 | 26,250 | 26,250 | 14,519 | 30,431 | 30,431 | |||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 37,452 | 37,452 | 37,452 | 37,452 | 37,452 | 41,225 | 82,449 | 82,449 | 82,449 | |||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 52,857 | 54,322 | 55,797 | 28,269 | 56,663 | 56,663 | 56,663 | 56,663 | 29,835 | |||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 23,958 | 61,337 | 61,337 | 61,337 | 61,337 | 46,003 | 53,330 | 71,107 | 71,107 | |||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 52,632 | 28,761 | 57,522 | 57,522 | 57,522 | 57,522 | 31,052 | 66,684 | 66,684 | |||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 24,289 | 24,898 | 25,506 | 26,896 | 11,948 | 23,272 | 23,272 | 23,272 | 23,272 | |||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 10,590 | 27,790 | 27,790 | 27,790 | 27,790 | 20,842 | 24,162 | 32,216 | 32,216 | |||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 50,520 | 50,520 | 50,520 | 33,680 | 40,365 | 48,438 | 48,438 | 48,438 | 44,402 | |||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 58,018 | 60,416 | 61,916 | 66,113 | 56,968 | 47,245 | 70,868 | 70,868 | 70,868 | |||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 10,776 | 5,214 | 10,010 | 10,010 | 10,010 | 10,010 | 5,005 | 11,604 | 11,604 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 11,952 | 11,952 | 11,952 | 5,986 | 11,993 | 11,993 | 11,993 | 11,993 | 5,997 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 26,592 | 26,592 | 26,592 | 13,494 | 27,384 | 27,384 | 27,384 | 27,384 | 13,692 | |||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 123,780 | 62,370 | 104,500 | 114,000 | 114,000 | 114,000 | 85,500 | 90,748 | 136,122 | |||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 6,000 | 6,000 | 6,000 | 6,000 | 2,532 | 6,097 | 6,097 | 6,097 | 6,097 | |||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 36,972 | 36,972 | 36,972 | 36,972 | 36,972 | 36,972 | 36,972 | 36,972 | 36,972 | |||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 149,796 | 151,944 | 154,080 | 156,216 | 158,364 | 160,500 | 162,636 | 164,784 | 57,896 | |||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 12,007 | 32,550 | 32,550 | 32,550 | 32,550 | 16,275 | 33,582 | 36,635 | 36,635 | |||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 21,713 | 86,850 | 86,850 | 86,850 | 86,850 | 65,138 | 67,122 | 100,683 | 100,683 | ||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 16,895 | 26,940 | 26,940 | 26,940 | 26,940 | 11,789 | 30,321 | 30,321 | 30,321 | |||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 25,626 | 71,170 | 77,640 | 77,640 | 77,640 | 58,230 | 60,004 | 90,006 | 90,006 | |||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 34,056 | 34,056 | 34,056 | 34,056 | 34,056 | 34,056 | 34,056 | 34,056 | 31,218 | |||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 104,458 | 97,185 | 46,999 | 93,998 | 93,998 | 93,998 | 93,998 | 42,909 | 108,969 | |||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 217,044 | 222,470 | 228,032 | 230,654 | 228,359 | 228,359 | 228,359 | 228,359 | 228,359 | |||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 13,145 | 39,435 | 39,435 | 39,435 | 39,435 | 20,130 | 44,385 | 44,385 | 44,385 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 3,286 | 39,436 | 39,436 | 39,436 | 39,436 | 26,290 | 36,988 | 44,385 | 44,385 | ||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 32,863 | 39,435 | 39,435 | 39,435 | 36,149 | 26,668 | 45,716 | 45,716 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 23,004 | 39,436 | 39,436 | 39,436 | 39,436 | 21,811 | 45,717 | 45,717 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 13,145 | 39,435 | 39,435 | 39,435 | 39,435 | 20,241 | 45,716 | 45,716 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 3,286 | 39,436 | 39,436 | 39,436 | 39,436 | 26,290 | 38,097 | 45,717 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 32,863 | 39,435 | 39,435 | 39,435 | 36,149 | 27,468 | 47,088 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 23,694 | 40,619 | 40,619 | 40,619 | 40,619 | 22,466 | 47,088 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 13,539 | 40,618 | 40,618 | 40,618 | 40,618 | 20,848 | 47,088 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 3,385 | 40,619 | 40,619 | 40,619 | 40,619 | 27,079 | 39,240 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 33,849 | 40,618 | 40,618 | 40,618 | 37,234 | 28,292 | |||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 1,702,204 | 1,863,003 | 2,268,950 | 2,398,516 | 2,437,047 | 2,318,113 | 2,122,056 | 2,567,203 | 2,526,198 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 14.73 | 16.12 | 19.64 | 20.76 | 21.09 | 20.06 | 18.36 | 22.22 | 21.86 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 9 |
Supporting Schedule — Scheduled Base Rental Revenue
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 405,381 | 405,381 | 3,704,042 | |||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 147,123 | 147,123 | 1,348,898 | |||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 172,032 | 172,032 | 1,596,465 | |||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 38,465 | 38,465 | 354,322 | |||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 22,946 | 15,298 | 228,164 | |||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 30,431 | 30,431 | 279,403 | |||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 82,449 | 44,508 | 602,789 | |||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 65,688 | 65,688 | 579,108 | |||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 71,107 | 71,107 | 653,067 | |||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 66,684 | 66,684 | 609,269 | |||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 12,254 | 26,979 | 245,858 | |||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 32,216 | 32,216 | 295,618 | |||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 33,739 | 57,838 | 506,898 | |||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 70,868 | 40,137 | 674,285 | |||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 11,604 | 11,604 | 107,451 | |||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 13,904 | 13,904 | 123,619 | |||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 31,746 | 31,746 | 279,990 | |||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 136,122 | 136,122 | 1,217,264 | |||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 2,622 | 7,069 | 60,611 | |||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 20,993 | 53,736 | 407,477 | |||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 138,951 | 138,951 | 1,594,118 | |||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 36,635 | 27,476 | 329,445 | |||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 100,683 | 100,683 | 904,105 | ||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 30,321 | 15,161 | 272,889 | |||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 90,006 | 90,006 | 807,974 | |||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 22,707 | 45,414 | 371,787 | |||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 108,969 | 108,969 | 994,450 | |||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 228,359 | 228,359 | 2,496,713 | |||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 44,385 | 29,590 | 398,145 | ||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 44,385 | 40,686 | 398,149 | ||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 45,716 | 45,716 | 396,849 | ||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 45,717 | 45,717 | 385,427 | ||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 45,716 | 45,716 | 373,990 | ||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 45,717 | 45,717 | 362,568 | ||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 47,088 | 47,088 | 356,049 | ||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 47,088 | 47,088 | 349,900 | ||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 47,088 | 47,088 | 338,123 | ||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 47,088 | 47,088 | 326,356 | ||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 48,501 | 48,501 | 318,231 | ||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 2,733,494 | 2,713,082 | 25,649,866 | ||||||||||||||||||||||
Weighted Average Per SqFt | 23.66 | 23.48 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 10 |
Supporting Schedule — Base Rent Abatements
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 87,421 | 101,345 | ||||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 31,727 | 36,781 | ||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 43,008 | |||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 8,295 | 9,616 | ||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 5,737 | |||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 6,563 | 7,608 | ||||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 20,612 | |||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 14,166 | 16,422 | ||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 15,334 | 17,777 | ||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 14,381 | 16,671 | ||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 5,818 | |||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 6,947 | 8,054 | ||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 4,037 | 8,073 | ||||||||||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 17,717 | |||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 2,502 | 2,901 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 2,998 | 3,476 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 6,846 | 7,937 | ||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 28,500 | 9,500 | 45,374 | |||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 2,032 | |||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 46,317 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 10,850 | 9,159 | 3,053 | |||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 33,561 | ||||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 8,980 | 10,107 | ||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 19,410 | 6,470 | 30,002 | |||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 31,333 | 36,323 | ||||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 9,859 | 11,096 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 9,859 | 3,699 | 7,398 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 3,286 | 6,573 | 11,429 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 9,859 | 11,429 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 9,859 | 11,429 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 9,859 | 3,810 | 7,619 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 3,286 | 6,573 | 11,772 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 10,155 | 11,772 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 10,155 | 11,772 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 10,155 | 3,924 | 7,848 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 3,385 | 6,770 | 12,125 | ||||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 84,525 | 225,295 | 81,256 | 34,817 | 15,923 | 78,127 | 312,864 | 128,556 | 137,133 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 0.73 | 1.95 | 0.70 | 0.30 | 0.14 | 0.68 | 2.71 | 1.11 | 1.19 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 11 |
Supporting Schedule — Base Rent Abatements
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 188,766 | |||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 68,508 | |||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 43,008 | |||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 17,911 | |||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 2,217 | 7,954 | ||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 14,171 | |||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 23,895 | 44,507 | ||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 30,588 | |||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 33,111 | |||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 31,052 | |||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 6,745 | 12,563 | ||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 15,001 | |||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 14,459 | 26,569 | ||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 20,539 | 38,256 | ||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 5,403 | |||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 6,474 | |||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 14,783 | |||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 83,374 | |||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 2,356 | 4,388 | ||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 17,912 | 17,912 | ||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 46,317 | |||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 23,062 | |||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 33,561 | ||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 8,788 | 27,875 | ||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 55,882 | |||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 15,138 | 15,138 | ||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 67,656 | |||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 4,288 | 25,243 | |||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 20,956 | ||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 21,288 | ||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 21,288 | ||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 21,288 | ||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 21,288 | ||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 21,631 | ||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 21,927 | ||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 21,927 | ||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 21,927 | ||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 22,280 | ||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 56,610 | 59,727 | 1,214,833 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.49 | 0.52 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 12 |
Supporting Schedule — Absorption & Turnover Vacancy
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 58,281 | 29,140 | 101,345 | |||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 31,728 | 36,781 | ||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 43,008 | |||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 8,295 | 9,616 | ||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 5,737 | |||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 2,188 | 4,375 | 7,608 | |||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 20,612 | |||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 14,166 | 16,422 | ||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 15,334 | 17,259 | ||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 14,381 | 16,671 | ||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 5,818 | |||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 6,948 | 7,819 | ||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 12,110 | 4,679 | ||||||||||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 11,467 | 5,906 | ||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 2,502 | 2,901 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 2,998 | 3,476 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 6,846 | 7,937 | ||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 28,500 | 33,039 | ||||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 1,524 | |||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 34,738 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 8,138 | 9,159 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 24,438 | ||||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 7,580 | |||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 19,410 | 21,846 | ||||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 3,674 | |||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 7,605 | 15,666 | �� | 27,242 | ||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 16,431 | 11,096 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 26,290 | 11,096 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 36,149 | 3,699 | 7,619 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 39,436 | 6,573 | 11,429 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 39,435 | 16,431 | 11,429 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 39,436 | 26,290 | 11,429 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 39,435 | 36,149 | 3,810 | 7,848 | |||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 39,436 | 39,436 | 6,770 | 11,772 | |||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 39,435 | 39,435 | 16,924 | 11,772 | |||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 39,436 | 39,436 | 27,079 | 11,772 | |||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 39,435 | 39,435 | 37,234 | 3,924 | 8,083 | ||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 512,948 | 361,416 | 103,673 | 36,120 | 18,809 | 146,247 | 253,677 | 74,330 | 122,017 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 4.44 | 3.13 | 0.90 | 0.31 | 0.16 | 1.27 | 2.20 | 0.64 | 1.06 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 13 |
Supporting Schedule — Absorption & Turnover Vacancy
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 188,766 | |||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 68,509 | |||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 43,008 | |||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 17,911 | |||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 6,650 | 12,387 | ||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 14,171 | |||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 23,895 | 44,507 | ||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 30,588 | |||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 32,593 | |||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 31,052 | |||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 6,745 | 12,563 | ||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 14,767 | |||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 9,640 | 26,429 | ||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 20,539 | 37,912 | ||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 5,403 | |||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 6,474 | |||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 14,783 | |||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 61,539 | |||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 1,767 | 3,291 | ||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 13,434 | 13,434 | ||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 34,738 | |||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 10,618 | 27,915 | ||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 24,438 | ||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 8,788 | 16,368 | ||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 41,256 | |||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 7,569 | 11,243 | ||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 50,513 | |||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 12,864 | 40,391 | |||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 4,288 | 41,674 | |||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 47,467 | ||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 57,438 | ||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 67,295 | ||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 77,155 | ||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 87,242 | ||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 97,414 | ||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 107,566 | ||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 117,723 | ||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 128,111 | ||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 39,155 | 87,642 | 1,756,034 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.34 | 0.76 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 14 |
Supporting Schedule — Base Rental Step Revenue
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 9,158 | 19,149 | 29,140 | 39,131 | 3,330 | 6,661 | 16,652 | |||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 1,813 | 5,439 | 9,065 | 12,691 | 7,252 | 906 | 4,532 | |||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | ||||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 948 | 1,896 | 2,844 | 3,792 | 711 | 1,659 | ||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 194 | 777 | 1,359 | |||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 625 | 1,375 | 2,125 | 2,875 | 500 | 438 | 1,188 | |||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 1,570 | 3,663 | 5,756 | |||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 1,017 | 2,543 | 4,069 | 5,595 | 2,035 | |||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 438 | 2,191 | 3,943 | 5,696 | 5,257 | 1,752 | 3,505 | |||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 1,233 | 2,876 | 4,520 | 6,163 | 1,643 | 822 | 2,465 | |||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 406 | 1,014 | 1,623 | 2,231 | ||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 198 | 992 | 1,786 | 2,580 | 2,382 | 794 | 1,588 | |||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 1,957 | 3,261 | 4,566 | 3,479 | 109 | 1,413 | 2,718 | 4,022 | 4,783 | |||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 1,649 | 3,448 | 5,247 | |||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 143 | 429 | 715 | 1,001 | 572 | 71 | 357 | |||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 161 | 484 | 807 | 1,130 | 646 | |||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 369 | 1,106 | 1,844 | 2,581 | 1,475 | |||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | ||||||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | ||||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | |||||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | ||||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | ||||||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 657 | 1,784 | 2,911 | 4,037 | 1,878 | 376 | 1,502 | 2,629 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 376 | 1,502 | 2,629 | 3,756 | 3,005 | 94 | 1,221 | 2,347 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 94 | 1,221 | 2,347 | 3,474 | 4,131 | 939 | 2,066 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 939 | 2,066 | 3,192 | 4,319 | 751 | 657 | 1,784 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 657 | 1,784 | 2,911 | 4,037 | 1,878 | 376 | 1,502 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 376 | 1,502 | 2,629 | 3,756 | 3,005 | 94 | 1,221 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 94 | 1,221 | 2,347 | 3,474 | 4,131 | 939 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 939 | 2,066 | 3,192 | 4,319 | 751 | 657 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 657 | 1,784 | 2,911 | 4,037 | 1,878 | 376 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 376 | 1,502 | 2,629 | 3,756 | 3,005 | 94 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 94 | 1,221 | 2,347 | 3,474 | 4,131 | ||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 1,957 | 5,024 | 28,242 | 56,898 | 87,260 | 114,923 | 52,983 | 49,548 | 69,093 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 0.02 | 0.04 | 0.24 | 0.49 | 0.76 | 0.99 | 0.46 | 0.43 | 0.60 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 15 |
Supporting Schedule — Base Rental Step Revenue
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 26,643 | 36,634 | 186,498 | |||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 8,158 | 11,784 | 61,640 | |||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 2,997 | 6,994 | 9,991 | |||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 2,607 | 3,555 | 18,012 | |||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,942 | 1,553 | 5,825 | |||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 1,938 | 2,688 | 13,752 | |||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 7,849 | 2,093 | 20,931 | |||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 636 | 2,162 | 18,057 | |||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 5,258 | 7,010 | 35,050 | |||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 4,109 | 5,752 | 29,583 | |||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 811 | 254 | 6,339 | |||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 2,382 | 3,176 | 15,878 | |||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 1,087 | 27,395 | ||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 7,046 | 600 | 17,990 | |||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 643 | 929 | 4,860 | |||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 81 | 404 | 3,713 | |||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 184 | 922 | 8,481 | |||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | ||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | ||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | ||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | ||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | |||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | ||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | ||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | ||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 3,756 | 3,005 | 22,535 | ||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 3,474 | 4,131 | 22,535 | ||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 3,192 | 4,319 | 21,783 | ||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 2,911 | 4,037 | 20,656 | ||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 2,629 | 3,756 | 19,530 | ||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 2,347 | 3,474 | 18,404 | ||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 2,066 | 3,192 | 17,464 | ||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 1,784 | 2,911 | 16,619 | ||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 1,502 | 2,629 | 15,774 | ||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 1,221 | 2,347 | 14,930 | ||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 939 | 2,066 | 14,272 | ||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 99,105 | 123,464 | 688,497 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.86 | 1.07 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : | ||
Date : 3/3/10 Time : 11:15 am Ref# : ARL Page : 16 |
Supporting Schedule — CPI & Other Adjustment Revenue
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | ||||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | ||||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | ||||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | ||||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | ||||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | ||||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | ||||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | ||||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 855 | 4,301 | 7,850 | 11,505 | 10,731 | 4,084 | ||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 122 | 309 | 501 | 699 | ||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 277 | 1,395 | 2,546 | 3,731 | 4,952 | 6,210 | 7,506 | 8,840 | 10,214 | |||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 488 | 1,479 | 2,500 | 3,552 | 2,043 | 275 | 1,382 | 2,523 | ||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 651 | 3,276 | 5,980 | 8,765 | 8,175 | 3,020 | 6,132 | ||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 606 | 1,433 | 2,284 | 3,160 | 845 | 455 | 1,378 | 2,329 | ||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 582 | 2,929 | 5,346 | 7,836 | 7,308 | 2,700 | 5,481 | |||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 85 | 1,109 | 2,164 | 3,251 | 4,370 | 5,523 | 6,710 | 7,933 | 8,328 | |||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 2,350 | 5,240 | 8,218 | 11,284 | 1,966 | 1,907 | ||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 2,284 | 9,203 | 16,330 | 23,670 | 31,231 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | |||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | |||||||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 362 | 4,831 | 14,682 | 29,743 | 48,009 | 59,152 | 53,600 | 51,390 | 72,928 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 0.04 | 0.13 | 0.26 | 0.42 | 0.51 | 0.46 | 0.44 | 0.63 | ||||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : | ||
Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 17 |
Supporting Schedule — CPI & Other Adjustment Revenue
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | ||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | ||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | ||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | ||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | ||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | ||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | ||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | ||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | ||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | ||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | ||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | ||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | ||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | ||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | ||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | ||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | ||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 8,290 | 12,622 | 60,238 | |||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 255 | 88 | 1,974 | |||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 939 | 1,075 | 47,685 | |||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 3,126 | 7,389 | 10,515 | |||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 3,697 | 3,449 | 21,388 | |||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 9,336 | 12,637 | 57,972 | ||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 3,309 | 1,903 | 17,702 | |||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 8,346 | 11,297 | 51,825 | |||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 1,135 | 40,608 | ||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 5,233 | 8,659 | 44,857 | |||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | 39,019 | 47,040 | 168,777 | |||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | |||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | |||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | |||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | |||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | |||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | |||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | |||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | |||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | |||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | |||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | |||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 81,550 | 107,294 | 523,541 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.71 | 0.93 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : | ||
Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 18 |
Supporting Schedule — Expense Reimbursement Revenue
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 18,317 | 20,753 | 30,712 | 37,363 | 44,010 | 50,627 | 22,123 | 34,859 | 42,080 | |||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 7,977 | 6,162 | 11,146 | 13,561 | 15,972 | 18,373 | 12,455 | 12,652 | 15,273 | |||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 8,792 | 9,056 | 9,328 | 9,608 | 11,150 | 13,796 | 15,750 | 19,197 | 8,353 | |||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 13,918 | 2,148 | 2,915 | 3,545 | 4,176 | 4,806 | 1,868 | 3,306 | 3,992 | |||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 1,282 | 1,665 | 2,136 | 2,524 | 2,911 | 1,868 | 1,769 | 2,273 | 2,695 | |||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 3,832 | 1,416 | 2,304 | 2,805 | 3,304 | 3,801 | 1,845 | 2,617 | 3,160 | |||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 4,605 | 4,743 | 4,885 | 5,032 | 5,183 | 4,003 | 6,362 | 8,167 | 9,680 | |||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 3,357 | 3,458 | 3,562 | 2,751 | 4,683 | 5,694 | 6,442 | 7,757 | 4,725 | |||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 4,972 | 5,008 | 6,425 | 7,590 | 8,758 | 7,437 | 4,604 | 6,116 | 7,380 | |||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 9,159 | 2,793 | 5,052 | 6,146 | 7,239 | 8,328 | 4,442 | 5,734 | 6,922 | |||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 1,339 | 1,379 | 1,420 | 1,536 | 1,166 | 1,909 | 2,207 | 2,732 | 3,171 | |||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 1,310 | 2,269 | 2,910 | 3,439 | 3,968 | 3,370 | 2,086 | 2,771 | 3,346 | |||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 2,870 | 2,956 | 3,045 | 2,352 | 4,002 | 4,867 | 5,508 | 6,632 | 6,943 | |||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | 1,539 | 1,585 | 1,633 | 1,682 | 1,732 | 1,784 | 1,838 | 1,893 | 1,949 | |||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | 1,063 | 1,094 | 1,127 | 1,161 | 1,196 | 1,232 | 1,269 | 1,307 | 1,346 | |||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 3,958 | 4,077 | 4,199 | 4,542 | 4,781 | 4,206 | 5,469 | 7,019 | 8,320 | |||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 629 | 486 | 880 | 1,069 | 1,258 | 1,450 | 982 | 997 | 1,205 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 711 | 732 | 754 | 582 | 994 | 1,205 | 1,362 | 1,642 | 1,162 | |||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 1,623 | 1,671 | 1,721 | 1,330 | 2,263 | 2,752 | 3,113 | 3,748 | 2,656 | |||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 4,180 | 3,229 | 4,616 | 4,936 | 5,265 | 5,604 | 4,465 | 5,141 | 5,511 | |||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 205 | 211 | 217 | 236 | 178 | 247 | 264 | 282 | 300 | |||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 1,555 | 1,602 | 1,650 | 1,700 | 1,751 | 1,803 | 1,857 | 1,913 | 1,970 | |||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 4,143 | 4,267 | 4,395 | 4,527 | 4,839 | 6,085 | 7,006 | 8,631 | 3,936 | |||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | 2,206 | 2,272 | 2,340 | 2,410 | 2,482 | 2,557 | 2,633 | 2,712 | 2,794 | |||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 895 | 1,279 | 1,368 | 1,459 | 1,553 | 1,172 | 1,483 | 1,587 | 1,692 | |||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 796 | 4,136 | 5,304 | 6,270 | 7,233 | 6,145 | 3,802 | 4,077 | 4,359 | ||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 988 | 1,059 | 1,133 | 1,207 | 1,286 | 914 | 1,227 | 1,312 | 1,400 | |||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 5,610 | 3,052 | 3,263 | 3,481 | 3,705 | 2,952 | 3,399 | 3,644 | 3,896 | |||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 1,315 | 1,354 | 1,395 | 1,436 | 1,479 | 1,524 | 1,570 | 1,617 | 1,526 | |||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 3,346 | 3,159 | 2,958 | 3,806 | 4,070 | 4,341 | 4,621 | 3,219 | 4,412 | |||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 741 | 1,652 | 2,403 | 3,151 | 2,581 | 3,425 | 4,397 | 5,210 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 741 | 1,652 | 2,403 | 3,151 | 2,839 | 3,425 | 4,397 | 5,210 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 741 | 1,652 | 2,403 | 3,151 | 3,574 | 2,467 | 3,931 | 4,745 | |||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 910 | 1,661 | 2,409 | 3,157 | 2,345 | 3,931 | 4,745 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 910 | 1,661 | 2,409 | 3,156 | 2,531 | 3,931 | 4,745 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 910 | 1,661 | 2,409 | 3,157 | 2,718 | 3,931 | 4,745 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 910 | 1,661 | 2,409 | 3,156 | 3,400 | 2,541 | 3,864 | ||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 749 | 1,500 | 2,247 | 2,798 | 2,405 | 3,864 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 749 | 1,500 | 2,246 | 2,798 | 2,585 | 3,864 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 749 | 1,500 | 2,247 | 2,798 | 2,767 | 3,864 | |||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 749 | 1,500 | 2,246 | 2,798 | 3,454 | 2,617 | |||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 116,492 | 101,294 | 133,389 | 156,935 | 187,676 | 205,458 | 165,324 | 203,824 | 213,627 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 1.01 | 0.88 | 1.15 | 1.36 | 1.62 | 1.78 | 1.43 | 1.76 | 1.85 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 19 |
Supporting Schedule — Expense Reimbursement Revenue
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 50,276 | 58,097 | 409,217 | |||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 18,246 | 21,084 | 152,901 | |||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 14,416 | 17,545 | 136,991 | |||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 4,770 | 5,513 | 50,957 | |||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 3,171 | 2,564 | 24,858 | |||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 3,774 | 4,360 | 33,218 | |||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 11,395 | 6,353 | 70,408 | |||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 5,504 | 6,698 | 54,631 | |||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 8,819 | 10,192 | 77,301 | |||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 8,271 | 9,556 | 73,642 | |||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 1,952 | 2,223 | 21,034 | |||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 3,996 | 4,618 | 34,083 | |||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 3,120 | 4,767 | 47,062 | |||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | 2,008 | 2,068 | 19,711 | |||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | 1,386 | 1,428 | 13,609 | |||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 9,795 | 4,479 | 60,845 | |||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 1,437 | 1,665 | 12,058 | |||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 1,166 | 1,420 | 11,730 | |||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 2,660 | 3,239 | 26,776 | |||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 5,893 | 6,287 | 55,127 | |||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 217 | 286 | 2,643 | |||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 1,522 | 2,175 | 19,498 | |||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 5,626 | 6,015 | 59,470 | |||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | 2,878 | 2,964 | 28,248 | |||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 1,801 | 1,435 | 15,724 | |||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 4,650 | 4,950 | 51,722 | ||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 1,490 | 1,124 | 13,140 | |||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 4,157 | 4,424 | 41,583 | |||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 1,429 | 1,839 | 16,484 | |||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 4,718 | 5,033 | 43,683 | |||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 6,134 | 4,955 | 34,649 | ||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 6,134 | 6,433 | 36,385 | ||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 5,669 | 6,553 | 34,886 | ||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 5,669 | 6,553 | 31,380 | ||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 5,669 | 6,553 | 31,565 | ||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 5,669 | 6,553 | 31,753 | ||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 4,788 | 5,671 | 28,400 | ||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 4,788 | 5,671 | 24,022 | ||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 4,788 | 5,671 | 24,201 | ||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 4,788 | 5,671 | 24,384 | ||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 4,064 | 4,946 | 22,374 | ||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 248,703 | 269,631 | 2,002,353 | ||||||||||||||||||||||
Weighted Average Per SqFt | 2.15 | 2.33 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 20 |
Supporting Schedule — Tenant Improvements
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 246,978 | 286,315 | ||||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 89,635 | 103,911 | ||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 121,504 | |||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 23,435 | 27,167 | ||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 16,207 | |||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 18,540 | 21,493 | ||||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 58,233 | |||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 40,020 | 46,394 | ||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 42,060 | 50,222 | ||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 40,627 | 47,098 | ||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 16,437 | |||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 19,056 | 22,754 | ||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 34,211 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 50,053 | |||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 7,070 | 8,196 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 8,471 | 9,820 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 19,341 | 22,422 | ||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 54,600 | 65,196 | ||||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 2,920 | |||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 66,551 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 15,136 | 17,546 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 72,375 | 48,222 | |||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 7,184 | 14,522 | ||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 36,103 | 43,108 | ||||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 45,020 | 52,191 | ||||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 56,336 | 31,348 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 56,337 | 31,349 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 56,336 | 32,289 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 58,027 | 32,289 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 58,026 | 32,289 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 58,027 | 32,289 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 58,026 | 33,258 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 59,767 | 33,258 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 59,767 | 33,258 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 59,767 | 33,258 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 59,767 | 34,255 | |||||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 360,923 | 712,991 | 284,088 | 102,043 | 19,357 | 219,258 | 787,642 | 250,419 | 300,946 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 3.12 | 6.17 | 2.46 | 0.88 | 0.17 | 1.90 | 6.82 | 2.17 | 2.60 | |||||||||||||||||||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 21 |
Supporting Schedule — Tenant Improvements
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 533,293 | |||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 193,546 | |||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 121,504 | |||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 50,602 | |||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 18,788 | 34,995 | ||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 40,033 | |||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 67,508 | 125,741 | ||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 86,414 | |||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 92,282 | |||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 87,725 | |||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 19,055 | 35,492 | ||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 41,810 | |||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 40,850 | 75,061 | ||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 58,025 | 108,078 | ||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 15,266 | |||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 18,291 | |||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 41,763 | |||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 119,796 | |||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 3,385 | 6,305 | ||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 25,737 | 25,737 | ||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 66,551 | |||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 32,682 | |||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 120,597 | ||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 16,835 | 38,541 | ||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 79,211 | |||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 21,751 | 21,751 | ||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 97,211 | |||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 36,341 | 124,025 | |||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 87,686 | ||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 88,625 | ||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 90,316 | ||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 90,315 | ||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 90,316 | ||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 91,284 | ||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 93,025 | ||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 93,025 | ||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 93,025 | ||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 94,022 | ||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 110,778 | 197,497 | 3,345,942 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.96 | 1.71 | ||||||||||||||||||||||||
![(ARGUS LOGO)](https://capedge.com/proxy/S-4/0000950123-10-085810/d75979d7597942.gif)
![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 22 |
Supporting Schedule — Leasing Commissions
Month One | Lease | First | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | |||||||||||||||||||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2010 | Dec-2011 | Dec-2012 | Dec-2013 | Dec-2014 | Dec-2015 | Dec-2016 | Dec-2017 | Dec-2018 | ||||||||||||||||||||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 71,317 | 82,031 | ||||||||||||||||||||||||||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 25,883 | 29,771 | ||||||||||||||||||||||||||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 34,713 | |||||||||||||||||||||||||||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 6,767 | 7,784 | ||||||||||||||||||||||||||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 4,650 | |||||||||||||||||||||||||||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 5,354 | 6,158 | ||||||||||||||||||||||||||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 16,709 | |||||||||||||||||||||||||||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 11,519 | 13,255 | ||||||||||||||||||||||||||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 12,510 | 14,389 | ||||||||||||||||||||||||||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 11,732 | 13,494 | ||||||||||||||||||||||||||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 4,723 | |||||||||||||||||||||||||||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 5,668 | 6,519 | ||||||||||||||||||||||||||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 9,847 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||||||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 14,362 | |||||||||||||||||||||||||||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 2,042 | 2,348 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 2,438 | 2,806 | ||||||||||||||||||||||||||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 5,567 | 6,406 | ||||||||||||||||||||||||||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 21,546 | 25,727 | ||||||||||||||||||||||||||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 1,152 | |||||||||||||||||||||||||||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | ||||||||||||||||||||||||||||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 26,262 | |||||||||||||||||||||||||||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||||||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 6,152 | 6,924 | ||||||||||||||||||||||||||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 26,055 | 19,029 | |||||||||||||||||||||||||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 3,772 | 5,731 | ||||||||||||||||||||||||||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 14,674 | 17,011 | ||||||||||||||||||||||||||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | ||||||||||||||||||||||||||||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 17,766 | 20,595 | ||||||||||||||||||||||||||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 11,915 | 8,995 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 11,915 | 8,995 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 11,915 | 9,251 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 11,915 | 9,251 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 11,915 | 9,251 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 11,915 | 9,251 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 11,915 | 9,515 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 12,252 | 9,515 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 12,252 | 9,515 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 12,252 | 9,515 | |||||||||||||||||||||||||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 12,252 | 9,787 | |||||||||||||||||||||||||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 104,576 | 192,301 | 66,774 | 29,371 | 5,875 | 66,366 | 235,538 | 84,382 | 93,229 | ||||||||||||||||||||||||||||||||||||||||
Weighted Average Per SqFt | 0.91 | 1.66 | 0.58 | 0.25 | 0.05 | 0.57 | 2.04 | 0.73 | 0.81 | |||||||||||||||||||||||||||||||||||||||||
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![]() | The Sterling Commercial 1801 JFK Boulevard Philadelphia, PA | Software : ARGUS Ver. 14.0.2 File : The Sterling Commercial (1) Property Type : Office & Retail Portfolio : Date : 3/3/10 Time : 11:16 am Ref# : ARL Page : 23 |
Supporting Schedule — Leasing Commissions
Month One | Lease | First | Year 10 | Year 11 | ||||||||||||||||||||||
For the Years Ending | Occupied Area | Start | Expiration | Dec-2019 | Dec-2020 | Total | ||||||||||||||||||||
Tenant | Suite | |||||||||||||||||||||||||
Devereux Foundation | 200 | 19,982.00 | 11/03 | 10/10 | 153,348 | |||||||||||||||||||||
Caring People Alliance | 220 | 7,252.00 | 4/04 | 3/11 | 55,654 | |||||||||||||||||||||
WB Mason | 230 | 7,993.00 | 12/07 | 12/17 | 34,713 | |||||||||||||||||||||
Mid Atlantic Mortgage | 301 | 1,896.00 | 10/07 | 9/10 | 14,551 | |||||||||||||||||||||
Relief of Widows and Ch | 303 | 1,165.00 | 3/03 | 5/15 | 5,353 | 10,003 | ||||||||||||||||||||
Contemporary Staffing S | 307 | 1,500.00 | 12/06 | 11/10 | 11,512 | |||||||||||||||||||||
AIMCO Regional Office | 330 | 4,186.00 | 1/07 | 12/14 | 19,235 | 35,944 | ||||||||||||||||||||
Equitrac Corporation | 340 | 3,052.00 | 11/07 | 1/13 | 24,774 | |||||||||||||||||||||
Michael Kleeman | 350 | 3,505.00 | 7/06 | 6/10 | 26,899 | |||||||||||||||||||||
Wainstein, Yanks & Cohe | 400 | 3,287.00 | 4/03 | 12/10 | 25,226 | |||||||||||||||||||||
Cornerstone Consultantm | 424A | 1,217.00 | 1/09 | 1/14 | 5,437 | 10,160 | ||||||||||||||||||||
Joel Oshtry, Esq. | 433 | 1,588.00 | 1/03 | 6/10 | 12,187 | |||||||||||||||||||||
Bayada Nurses | 444 | 2,609.00 | 7/08 | 8/13 | 11,655 | 21,502 | ||||||||||||||||||||
AIMCO Resident Lounge | 452 | 1,399.00 | 12/09 | 11/21 | ||||||||||||||||||||||
AIMCO Maintenance Room | 454 | 966.00 | 12/09 | 11/21 | ||||||||||||||||||||||
SOMA | 460 | 3,598.00 | 11/09 | 10/14 | 16,533 | 30,895 | ||||||||||||||||||||
Robert Cole PC | 465 | 572.00 | 4/08 | 3/11 | 4,390 | |||||||||||||||||||||
Public House Investment | 475 | 646.00 | 7/08 | 3/13 | 5,244 | |||||||||||||||||||||
Public House Investment | 480 | 1,475.00 | 4/08 | 3/13 | 11,973 | |||||||||||||||||||||
Hwa Yuan Restaurant | 1801 | 3,800.00 | 7/06 | 6/11 | 47,273 | |||||||||||||||||||||
K Shoe Repair | 1803 | 186.00 | 12/08 | 1/14 | 1,336 | 2,488 | ||||||||||||||||||||
Hot Tamales | 1805 | 1,414.00 | 10/03 | 1/19 | 10,156 | 10,156 | ||||||||||||||||||||
Trumark Financial Credi | 1811 | 3,766.00 | 1/08 | 12/17 | 26,262 | |||||||||||||||||||||
AIMCO Leasing Storefron | 1821 | 2,005.00 | 1/10 | 12/21 | ||||||||||||||||||||||
City Nails | 1823 | 1,085.00 | 4/03 | 3/10 | 13,076 | |||||||||||||||||||||
Vacant Retail | 1825 | 10/10 | 9/15 | 45,084 | ||||||||||||||||||||||
Subway | 1827 | 898.00 | 4/05 | 3/10 | 6,643 | 16,146 | ||||||||||||||||||||
JFK Dental | 1829 | 2,588.00 | 8/05 | 6/10 | 31,685 | |||||||||||||||||||||
Young’s Tailor and Clea | 1831 | 1,195.00 | 12/08 | 11/18 | 8,583 | 8,583 | ||||||||||||||||||||
7-Eleven Store | 1833 | 3,042.00 | 12/06 | 11/11 | 38,361 | |||||||||||||||||||||
Central Parking | Garage | 1.00 | 9/08 | 8/13 | ||||||||||||||||||||||
Vacant Space | Qtr 2 | 6/10 | 5/15 | 10,355 | 31,265 | |||||||||||||||||||||
Vacant Space | Qtr 3 | 9/10 | 8/15 | 20,910 | ||||||||||||||||||||||
Vacant Space | Qtr 4 | 12/10 | 11/15 | 21,166 | ||||||||||||||||||||||
Vacant Space | Qtr 5 | 3/11 | 2/16 | 21,166 | ||||||||||||||||||||||
Vacant Space | Qtr 6 | 6/11 | 5/16 | 21,166 | ||||||||||||||||||||||
Vacant Space | Qtr 7 | 9/11 | 8/16 | 21,166 | ||||||||||||||||||||||
Vacant Space | Qtr 8 | 12/11 | 11/16 | 21,430 | ||||||||||||||||||||||
Vacant Space | Qtr 9 | 3/12 | 2/17 | 21,767 | ||||||||||||||||||||||
Vacant Space | Qtr 10 | 6/12 | 5/17 | 21,767 | ||||||||||||||||||||||
Vacant Space | Qtr 11 | 9/12 | 8/17 | 21,767 | ||||||||||||||||||||||
Vacant Space | Qtr 12 | 12/12 | 11/17 | 22,039 | ||||||||||||||||||||||
Total Amount Per Year | 87,868.00 | 37,167 | 58,119 | 973,698 | ||||||||||||||||||||||
Weighted Average Per SqFt | 0.32 | 0.50 | ||||||||||||||||||||||||
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The Sterling Philadelphia, Pennsylvania | February 22, 2010 Addenda |
APPRAISER QUALIFICATIONS
COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Addenda |
STEVEN J. GOLDBERG, MAI, CCIM
MANAGING PARTNER
MANAGING PARTNER
STEVEN J. GOLDBERG is the Managing Partner of Cogent Realty Advisors, LLC. His responsibilities include staff supervision, appraisal management, maintaining product quality, marketing and client development. In his current capacity, Mr. Goldberg oversees all valuation assignments involving real estate assets located in the Southwest region.
Mr. Goldberg has over 24 years of nationwide experience in real estate valuation, investment analysis and evaluation consultation. He has performed appraisals throughout the United States and has extensive experience in most markets situated in the Southwest and Southeast regions of the country. Mr. Goldberg’s particular area of expertise is in the appraisal and analysis of multifamily apartment projects. In addition to his expertise in the multifamily market, Mr. Goldberg has extensive experience in the appraisal of other income-producing properties including office buildings, retail properties, lodging facilities, industrial properties and mixed-use projects.
Mr. Goldberg has performed marketability, consultation and feasibility reports, has served as an expert witness and has testified in various state and federal courts. These activities have been performed on behalf of real estate investors, life insurance companies, pension funds, investment banking firms, foreign and domestic financial institutions, mortgage bankers, conduit lenders, real estate advisors, law firms and governmental agencies.
Mr. Goldberg received his Bachelor of Business Administration Degree from the University of Texas in Austin, with major concentrations in both Finance and Real Estate/Urban Land Economics. He is a designated member of the Appraisal Institute and the Commercial Investment Real Estate Institute having been awarded the MAI designation in 1989 and the CCIM designation in 1994. He has attended numerous continuing education courses and has completed the requirements under the continuing education program of the Appraisal Institute.
Mr. Goldberg is state certified as a General Real Estate Appraiser in Texas. He is also a licensed Real Estate Broker in the State of Texas. He is affiliated with the North Texas Commercial Association of Realtors, International Council of Shopping Centers and Mortgage Bankers Association.
COGENT Realty Advisors, LLC
The Sterling Philadelphia, Pennsylvania | February 22, 2010 Addenda |
ROBERT T. DON, AICP
SENIOR APPRAISER
SENIOR APPRAISER
ROBERT T. DON, Senior Appraiser with Cogent Realty Advisors, LLC, has a strong background in real estate valuation, management, marketing, and consulting. He has 15 years of national experience within the real estate industry. As a real estate appraiser, Mr. Don has been engaged to perform valuation studies on a variety of complex commercial properties including mixed use developments, regional malls, marinas, and other special-use properties. He has significant valuation experience in most national markets.
Mr. Don has worked as an urban planning consultant and asset and marketing manager since 1977. He was manager of land development projects for several large real estate investment companies in Dallas, Texas. In this capacity, Mr. Don was responsible for the marketing and sale of large planned developments and the management of a diverse real estate portfolio. From 1978 to 1983, Mr. Don worked as a land use manager with the nation’s largest land owner, International Paper Company. In this capacity, he instituted a company-wide program for land use decisions, was a review appraiser, planner, and land manager of timberlands, plants, and facilities. In addition to these responsibilities, he became a specialist in timberland analysis and was the real estate manager for 1.2 million acres in the southeastern United States.
Between 1997 and 1978, Mr. Don worked as an urban planning consultant with Gruen Associates, Inc., a national architectural and engineering firm in New York City. During this time, he was consulting planner on diverse projects including expansion of the Metropolitan Museum of Modern Art; light-rail transit planning for Buffalo, New York; HUD new town planning for Flower Mound, Texas; feasibility studies for the reuse of the former Penn Central Railroad properties; and community impacts of industrial facility and military base closing.
Mr. Don received his Bachelor Degree of Urban Planning and Design from the University of Cincinnati in 1997. Since then, he has completed graduate work at the Real Estate Institute of New York University and appraisal course work at the Appraisal Institute. He has lectured extensively at universities throughout the United States and has authored articles on land use planning and real estate subjects. Mr. Don is both a licensed real estate broker and State Certified general appraiser in the State of Texas. He is a member of the American Planning Association. Mr. Don is a candidate for his MAI designation with the Appraisal Institute. In addition to extensive real estate course work, he has successfully completed certain requirements towards the MAI designation.
COGENT Realty Advisors, LLC