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P <br />they now exist. This change has an effect of reducing the <br />expenditures due to operating costs and reducing the total <br />revenue for the school portion of the project. <br />The lease rate per townhouse unit was increased from $1500 to <br />$3000 to reflect it in the process of true revenue the school <br />would receive rather than attempting to reflect it as a <br />real estate transaction. Last of all, the lease rate per <br />unit of parking was decreased from $27.50 to $16.60 to again <br />better reflect the true revenue for a business operation. <br />Based on the result from this analysis, the project, without <br />the assistance of tax increment, would generate an average <br />return on investment of approximately 2.05%. With the <br />assistance of tax increment, the return rises to <br />approximately 8.09%. <br />We also discussed in our meeting, the reflection of that <br />return on investment in comparison to other real estate <br />transactions in the metropolitan area. Traditionally, a <br />return on investment for a real estate transaction needs to <br />be in the 10% to 12% range in order for a developer to <br />proceed. The reason that Bradford schools has chosen to <br />investment <br />proceed with the ;project is that their return on <br />is not based on a real estate transaction but rather business <br />consider.atip.ns of the services they provide and the potential <br />growth of that service in the market place. <br />I hope this correctly responds to the questions and corunents <br />you had and I Look forward to working with on this project in <br />the future. If I can be of additi,',nal service, please feel <br />free to let me know. <br />Sincerely, <br />I <br />Sid Inman <br />Director, Development Consulting <br />1 <br />1 <br />1 <br />1 <br />