The Sunset District NAIOP Real Estate Development Workshop

April 2012

Bryant Cheong Matthew Craigie

Khoa Le Jeff Sakamoto

Michael Weidmann Kent Wu

The Sunset District

• Site Assessment • Development Vision • Site Design • Final Summary • Acknowledgments • Appendix

Presentation Outline

The Surrounding Area Jobs

+/- 25000

Housing 6700 households

Neighborhood

Rock Creek / Tanasbourne

Schools Six High Schools & Two PCC campuses within 5 mile radius

Tanasbourne

Regional Center Streets of Tanasbourne

AmberGlen R.C.

Silicon Forest Oregon’s Employment Hub

-Local Employers-

15,000 =

= 7000

1000 =

= 500

Existing Conditions • Owned by Standard Insurance

Company • Size: Approximately 16 acres • Current Use: Greenfield • Significant sloped topography

•Current Zoning: - General Commercial (C1) - Industrial Park (M-P) - Planned Unit Development Overlay since 1997

Planned Unit Development Industrial Park General Commercial Multi-Family Residential

Initial Site Analysis Strengths

• Proximity to employers • Highway visibility •Coastal Mountain view corridor • High volume of visitors

Weaknesses • Sloped topography • Landlocked between exits • Zoning • Soft office market

Opportunities • Kaiser hospital • Strong rental market • Growing community

Threats • Low multifamily rental rates • Possible rezoning hurdles • Constrained vehicular access

Mixed Use

Office Senior

Housing

Restaurant

Retail

Outlet Mall

Entertainment

Medical Office

For Sale Housing

Hotel

Self Storage

Multi-Family

Aquatic Center

Mixed Use

Entertainment

Restaurant

Retail

Hotel

Multi-Family Rental

Will the use realize the value of the land?

Is the use feasible in the development horizon?

Is the use appropriate?

Senior Housing Outlet Mall

Campus/Industrial

For Sale Housing Office

Medical Office

Aquatic Center Self Storage

Casino

Decision Criteria

Development Vision

• Vibrant, mixed use, walkable district

• Marketable phases • Regional entertainment

destination • Maximizing land value • A long term precedent • Urban feel in a suburban

location

Market Analysis Surrounding the Sunset District is a community with a demographic profile of highly educated, high income

professionals, with an average household income of over $78,000 within a 5 mile radius.

13.5%

10.9%

24.6%

24.6%

15.9%

7.5%

3.0%

0-9

10-19

20-29

30-44

45-59

60-74

75+

Age

Dis

trib

utio

n R

ange

Age Groups

1.8% 2.8% 12.7%

14.3%

24.9%

16% 9.5%

9.3% 8.6%

Household Incomes

INCOME DISTRIBUTION

Development Theme ~The Sunset District~

Residential 273 Units of Multifamily Housing

Destination Retail Dave & Busters, Big Al’s, Regal Cinemas

Restaurant Oswego Grill, Thirsty Lion, Noble Rot, Starbucks

Upscale Hotel aloft, Hyatt Place

Development Overview

Multifamily Residential Features • Urban community feel • Neighborhood retail space • 1,2, & 3 bedroom units • Secure garage parking • Outdoor common areas

Number of Units 273

Rent per SF $1.45

Total Cost $46 million

Cost per Unit $167,000

Return on Costs 7.0%

IRR 14%

Assumed Land Value $17 per SF

Target Market Range

Destination Entertainment • Synergy of uses • Maximize signage/visibility • Emphasis on pedestrian

accessibility • On street & garage parking

Development Principles ~Destination Entertainment~

Big Al’s/D&B Concept: • Fee simple ownership • Build and sell development

Building Footprint 51,000 SF

Land Sale (4 acres) $17 per SF

Building Footprint 56,000 SF

Total Construction Costs $17 million

Comparable Rent $19-$21 per SF

Regal Cinema Concept: • Negotiation with existing landlord • Turn key with 20-25 year lease • Relocate and upgrade existing facility

Development Principles ~Upscale Hotel~

Hotel Concept: • EB-5 Financing • Midrise construction • Corporate meeting facilities • Upscale hotel amenities • Secure garage parking facilities • Adjacent entertainment and restaurant destinations

Building Shell Six Stories

Total Size 66,000 SF

Number of Rooms 137

Price Point $125 per night

Total Cost $127,000 per key

Land Value $10,000 per key

Development Principles ~Restaurant~

Restaurant Concept:

Rent $34-$36 per SF

Cap Rate 7.5%

Total Stabilized Value $16 million

Total Cost $14 million

NOI $1.2 million

Return on Costs 9%

Number of Pads 4

Total Size 29,000 SF

Pad Size Range 6,500-9,000 SF

Number of Pads 5

Total Size 11,000 SF

Pad Size Range 1,500-3,000 SF

Full Service Restaurant/Bar

Inline Retail/Small Restaurant

Parking

Shared Parking

Hotel 160

Theater 400

Entertainment Arcade 387

Restaurant / Retail 205

Total 1152

Multifamily 354

Parking Allotment

Commercial Uses

Streetscape • Pedestrian friendly sidewalks and

lighting • Blend the street and building realm • Provide visual connections and

hierarchy • Mitigate stormwater impacts • On street parking • Narrow ROW to slow traffic

Landscape and Outdoor Areas

• Provides “Third Place” • Pedestrian oriented • Outdoor/Green spaces for

residents • Supplements parking needs

Site Design Multifamily – Entertainment – Restaurant/Retail

Final Summary

Feasible - Innovative - Delivers Value

• Bob LeFeber - CRA Advisors • Dick Loffelmacher - CB Richard Ellis • Mike Wells - CB Richard Ellis • Robert Crane - Regal Cinemas • David Pettingill - Dave and Buster’s • Gary Vance - Holland Development • Matt Grady - Gramor Development • Dave Burnett - Oswego Grill • Bud Gabriel - Oswego Grill • Isaac Scott - Anthem Memory care • Christopher Dobbins – Hyatt • Jay Leo - The Springs at Tanasbourne • Willy Paul - Kaiser • Mike Goakey - Goakey Theater

Consulting • Colin Cooper - City of Hillsboro • Dawn Nguyen - Realty Income

Corporation • Jeffry Tallman - Cypress Capital

Management

• Roger Collins - InnVentures • Bill Jensen - Howard S. Wright • Gordon Childress - Howard S. Wright • Dick Spies - Group Mackenzie • Mark Fisher - StanCorp Mortgage

Investors, LLC

Sincere Thanks To:

Appendix 1) Overview

2) Multi-Family

3) Parking Structure

4) Theater and Hotel

5) Restaurant and Retail

Appendix