General Assumptions for Pro-forma

 

Analysis Period 7 Years	Start Date June 1, 1999
Rental Income Based on leases in place as of January, 1999.CCAD (Suite 2017) -Community service space that is not under a lease commitment. Free rent is shown to expire in August, 2005. Wyndham (Suite 5007, 5008, 5029, 6001) - A 163,841 square foot space is shown in the lease, but part of the space is vacant. A discrepancy exists over the square footage in the lease and the square footage in the certificate of occupancy (C.O.) Also, rent is not paid on space which does not have a C.O. An agreement has been made that the rental rate will be changed as the tenant occupies the space. 119,644 square feet is currently occupied at $10.00 per square foot. 28,350 square feet is currently occupied at $11.07 per square foot. 5,634 square feet is occupied and assumed will be back charged at $10.07 per square foot. It is assumed that the remaining 10,213 square feet will be occupied during May 1999 at $12.99 per square foot. Inforent (5027) - The lease is assumed to end June 30, 1999 to represent the tenant currently occupying space on a month to month basis.
Vacancy/Collection Loss Standard Office 7% CLEC/ISP tenants 2%	Expenses 1999 Budget
Taxes Based on the 1998 final assessed value in Year 1. The amount was doubled in Year 2 and increased at the same rate as inflation in the following years.
Administrative Salaries Based on the 2000 Labor Detail (Exhibit A) with the assumption that certain salaries would be split as responsibilities are shared between other properties in Y ear 2. Three salaries used to set up meeting space would be cut in Year 3. It also assumes that current management would benefit from the economies of scale of a large management company and that certain jobs could be consolidated.
Administrative Benefits Based on the 1999 ratio of salaries to benefits. Benefits = $746,234 = 19.81% Salaries $3,766,958 This ratio is applied to the 2000 Labor detail to figure benefits in Year 2. 19.81% x $3,002,348(Year 2 salaries) = $594,765 (Year 2 Benefits)
Administrative Expenses Bad Dept (Expense Cut) $0 Advertising (Expense shared 50% with other property) $6,250Printing (Expense shared 50% with other property) $15,318 Travel (Expense shared 50% with other property) $9,422 Office Rent (Expense Cut) $0
Utilities Based on 1999 Budget with an increase of 12% in Year 2 due to the conversion of exhibit space to rental space.
Expense Reimbursement Based on the pro-rata share of the tenants net rentable square footage which is determined on all existing leases with the building size of 1,056,200 net rentable square feet. All absorbed and new space is figured on a total of 1,138,067 net rentable spare feet due to addition of space on the first floor.
Expense Inflation 2.0%	Escalation 3.0%
Market Rent - Year 1 Office standard $22.00 Tenant Services $8.00 CLEC $24.00 Sixth Floor $24.00 ISP $22.00	Lease Term (years) Office Standard 5 years Tenant Services 5 years CLEC 10 years Sixth Floor 5 years ISP 5 years
5001 INFOMART Based on the 1999 budgeted gross income of $432,000. The executive suites occupy 19,520 square feet which is equivalent to an annual rate of $22.13 per square foot. This amount is assumed to grow at a rate of3%. These smaller tenants are on one year leases.
Parking Income on the East Garage is based on a contract price of $45.00/month per space. Income on the Lower Level Garage is based on a contract price of $60.00- $90.00/month per space. Surface parking is the projected income from the addition of a surface gate which occurs before June, 1999.
Meeting Rooms First year income includes tenant use of meeting rooms and third party use for conferences. Including and continuing after y ear 2 meeting rooms are assumed to only host tenant meetings. Because of the decline in meetings, the revenue is expected to decline by 15% in Year 2. It is expected to grow by 10% in y ears 3 and 4 due to an increased tenant population (based on lease-up of additional space) and increased rates. The revenue is expected to grow at a 3% rate after Year 6 due to an increase in the number of meetings per year, along with increased rates.
Concessions - Food & Beverage Based on the 1999 Budget in Year 1. Years 2-8 are based on a tenant population of 3,000 at a 6% ratio eating three times per week for 50 weeks at a meal price of $6.00 per person which equals $162,000.
Maintenance Income based on reimbursements for labor performed on tenant space for tenant use by INFOMART personnel.
Postal Net income received from building mailroom.
Secretarial Services Net income received from 5001 INFOMART secretarial service which is used by 5001 INFOMART and other tenants.
Interest Due to a decrease in accounts which formerly included escrowed amounts for taxes, interest income is reduced to $30,000 per year.