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2006/05/23 City Council ResolutionRESOLUTION NO. 2006-129 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ROHNERT PARK CALIFORNIA, APPROVING A COOPERATION, REIMBURSEMENT, AND PURCHASE AND SALE AGREEMENT WITH THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF ROHNERT PARK ( "CDC ") FOR THE ACQUISITION OF PROPERTY LOCATED AT 705 ROHNERT PARK EXPRESSWAY (ASSESSOR'S PARCEL NUMBERS 143 - 391 -053 AND -054) AND AUTHORIZING THE CITY MANAGER TO EXECUTE THE AGREEMENT WHEREAS, Pursuant to section 33334.2 of the California Health and Safety Code, the CDC has set aside 20% of tax increment revenues allocated to the CDC for the purposes of increasing, improving and preserving the community's supply of low -and moderate - income housing available at affordable housing costs ( "20% Set -Aside Funds "); and WHEREAS, the City owns certain real property located within the Redevelopment Project area boundaries described as Assessor's Parcel Numbers 143 -391 -053 and -054, located at 705 Rohnert Park Expressway (the "Site "); and WHEREAS, the CDC and Burbank Housing Development Corporation, ( "BHDC "), entered into a Pre - Development Agreement dated December 19, 2002 (modified by an Amendment dated August 26, 2003 and an Amendment No. 2 dated September 27, 2005) through which $266,667 was approved for pre- development of the Site for the Vida Nueva Affordable Housing Project; and WHEREAS, Burbank Housing Development Corporation and the Community Housing Development Corporation of Santa Rosa ( "CHDSR "), which collectively make up the partnership of Vida Nueva Partners L.P. (the "Developer "), desire to utilize the Site for the development, maintenance, and operation of the Vida Nueva Affordable Housing Project, consisting of twenty-four (24) unit permanent affordable housing rental complex comprised of four (4) one - bedroom units, ten (10) two bedroom units, and nine (9) three - bedroom units affordable to households with incomes up to 50 °�'`0 of median area income, one (1) unrestricted three - bedroom unit reserved for the resident manager, together with parking, a community building housing laundry facilities, management office, and activity and counseling rooms; and WHEREAS, the CDC and Developer have cooperated to prepare an Affordable. Housing and Loan Agreement (the "Affordable Housing Agreement ") pursuant to which Developer will acquire the Site from the CDC for the development, maintenance and operation of the Vida Nueva Affordable Housing Project; and WHEREAS, the Commission desires to use a portion of the 20% Set -Aside Funds to purchase the Site from the City for subsequent transfer to Vida Nueva Partners, L.P. pursuant to the Affordable Housing Agreement, for development of affordable housing in furtherance of Redevelopment Plan goals; and NOW THEREFORE BE If RESOLVED, that the City Council of the City of Rohnert Park approves the Cooperation, Reimbursement, and Purchase and Sale Agreement and authorizes its execution by the City Manager in substantially the form currently on file with the City Clerk, subject to any minor, clarify and conforming changes as may be approved by the City Attorney. BE IT FURTHER RESOLVED that the City Council of the City of Rohnert Park hereby authorizes the City Manager to negotiate future changes to the Agreement and execute any future Amendments necessitated by those changes. DULY AND REGULARLY ADOPTED this 23rd day of May, 2006. CITY COUNCIL, OF THE CITY OF ROHNERT PARK Mayor Tim ATTEST: City Clerk LI FOR W' BREEZE: AYE FLORES: AYE MACKENZIE: AYE VII)AK- MARTINEZ: AYE SMITH: AYE AYES: (5) NOES: (0) ABSENT: (0) ABSTAIN: (0) (2) COOPERATION, REIMBURSEMENT, AND PURCHASE AND SALE AGREEMENT (Vida Nueva Property) This Cooperation, Reimbursement, and Purchase and Sale Agreement ( "Cooperation Agreement ") is made and entered into on this day of , 2006 ( "Effective Date ") by and between the Community Development Commission of the City of Rohnert Park, a public body corporate and politic ( "Commission ") and the City of Rohnert Park, a California municipal corporation ( "City "). RECITALS A. City has adopted the Rohnert Park Community Development Project ( "Redevelopment Project ") pursuant to the Redevelopment Plan therefor adopted by Ordinance No. 479 of the City Council of the City on July 14, 1987 ( "Redevelopment Plan "), as amended, and incorporated herein by reference. B. Pursuant to section 33334.2 of the California Health and Safety Code, Commission has set aside 20% of tax increment revenues allocated to Commission for the purposes of increasing, improving and preserving the community's supply of low -and moderate - income housing available at affordable housing costs. C. City owns certain property located within the Redevelopment Project area boundaries as described in Exhibit A attached hereto and incorporated by reference ( "Vida Nueva Property ").. D. Pursuant to Section 33334.2 of the California Health and Safety Code, Commission has set aside 20% of tax increment revenues allocated to it to improve and increase the supply of affordable housing in the community. Commission desires to use a portion of such monies to purchase the Vida Nueva Property from City for subsequent transfer to an affordable housing developer pursuant to an anticipated disposition and development agreement, for development of affordable housing in furtherance of Redevelopment Plan goals. E. Pursuant to their general powers and Section 33220 of the California Health and Safety Code, Commission and City desire to enter into this Cooperation Agreement to cooperate in Commission's acquisition of the Vida Nueva Property in furtherance of the goals of the Redevelopment Plan, and to set forth the terms and conditions of such acquisition. FIX91191400102MI 1. Offer to Purchase; Acceptance. Commission hereby offers to purchase the Vida Nueva Property under the terms and conditions set forth'in this Cooperation Agreement, and City hereby accepts such offer. 2. Terms. (a) Purchase Price. The purchase price for the Vida Nueva Property shall be One Million, Six Hundred Thirty Thousand and 00 /100 Dollars ($1,630,000) ( "Purchase Price "). The Purchase Price is based on the fair market value appraisal of the Vida Nueva Property dated December 1,2005 with a valuation date of November 1, 2005 and prepared by The Crocker 910298v2 80078/0022 Company, excerpts from which addressing the conclusion of value are attached hereto as Exhibit B and incorporated by reference. (b) Closing Costs. Closing costs shall be paid by Commission. (c) Promissory Note. Commission shall submit to City a promissory note representing the Purchase Price in substantially the form attached hereto as Exhibit C and incorporated by reference ( "Promissory Note "). 3. Escrow and Closing. (a) Escrow Account. Commission has opened escrow number ( "Escrow ") with North American Title Company ( "Escrow Agent" and "Title Company ") for conveyance of the Vida Nueva Property to Commission. (b) Escrow Deposits. Commission shall deposit this Cooperation Agreement together with the Promissory Note and closing costs into Escrow. Subject to Section 5 of this Cooperation Agreement, City shall deposit into Escrow a grant deed transferring ownership of the Vida Nueva Property to Commission ( "Grant Deed "). (c) Title Report. Title Company shall deliver to each City and Commission a standard preliminary title report ( "Report") with respect to the title to the Vida Nueva Property, together with Iegible copies of the documents underlying the exceptions ( "Exceptions ") set forth in the Report. Commission shall have the right to approve or disapprove the Report and any Exceptions. (d) Close of Escrow. Escrow shall close as soon as practicable after: 1. deposit into Escrow of the foregoing item ii. Commission approval of the Report and Exceptions, and iii. (ii) satisfaction of both California Government Code section 65402 and the Surplus Lands Act (California Government Code § §54220 et seq.) (collectively, "Government Code Sections "). If such conditions are not satisfied within one hundred twenty (120) days of the date of this Cooperation Agreement, Escrow Agent shall return all Escrow, deposits to the depositing party and Escrow shall be terminated, except as otherwise mutually agreed by the parties. (e) Title Insurance. Concurrently with recordation of the Grant Deed, Title Company shall issue to Commission a CLTA owner's policy of title insurance ( "Title Policy "), together with such endorsements as are reasonably requested by Commission, in the amount of the Purchase Price and insuring that title to the Vida Nueva Property is vested in Commission. Escrow Agent shall provide Commission with a copy of the Title Policy. City may request a Lender's policy of Title Insurance together with such endorsements as City may reasonably require ( "Lender's Policy ") in conjunction with the Title Policy. City shall bear all costs associated with the Lender's Policy. (� Escrow Instructions. This Cooperation Agreement shall serve as joint escrow instructions. The parties may execute supplemental escrow instructions in furtherance of this 910298v2 80078/0022 Cooperation Agreement. 4. Reimbursement and Pledge. (a) Reimbursement. Commission agrees to reimburse City for the Purchase Price from and to the extent that funds are available to Commission from its Low and Moderate Income Housing Fund ( "Housing Fund ") established for the Redevelopment Project, which funds are authorized to be used by Commission for the purpose of increasing, improving and preserving the community's supply of low- and moderate - income housing, and from other sources of funds available to Commission; provided, however, that Commission shall have the sole and exclusive right to pledge any such sources of funds to the repayment of other indebtedness incurred by Commission in carrying out its responsibilities with respect to such Housing Fund. Although the parties recognize that payment may not occur for a few years and that payment may also occur over a period of time, it is the express intent of the parties that City shall be entitled to payment of the Purchase Price under this Cooperation Agreement, consistent with the Commission's financial ability, in order to make the City whole as soon as practically possible. (b) Pledge. The obligations of Commission under this Cooperation Agreement and the Promissory Note shall constitute a pledge and indebtedness of Commission within the meaning of Section 33670 et seq. of the Community Redevelopment Law, to be repaid to City together with simple interest the rate of five percent (5 %) per annum, from date of recordation of the Grant Deed until repaid by Commission pursuant to the terms of the Promissory Note. 5. Cooperation Agreement Effectiveness. City must satisfy the Government Code Sections before any portion of this Cooperation Agreement or the Promissory Note becomes fully effective, notwithstanding Council approval of this Cooperation Agreement, the Promissory Note, or City's or Commission's signature to both or either of such documents. In addition, satisfaction of the Government Code Sections are conditions precedent to execution of the Grant Deed and Close of Escrow. [Signatures follow on next page] 910298v2 80078/0022 3 :111;36 M-3 APPRAISAL Lail *I 11 APPRAISAL of VACANT LAND 705 Rohnert Park Expressway Rohnert Park, CA 94928 Assessor's Parcel Numbers 143 -391 -053 and -054 VALUATION DATE November 1, 2005 PREPARED FOR Cas Ellena Housing & Redevelopment Project Manager City of Rohnert Park 6750 Commerce Blvd. Rohnert Park, CA 94928 -2486 voice: 707.588.2233 fax: 707.588.2263 RONALD J. CROCKER, MAI, SRA LINDA DARNELL CROCKER voice: 707.538.7771 fax: 707.538.7779 the crocker. company ronald jay crocker MAI, SRA linda darneil crocker JD December 1, 2005 Via Hand Delivery Cas Ellena Housing & Redevelopment Project Manager City of Rohnert Park 6750 Commerce Blvd. Rohnert Park, CA 94928 -2486 -Re 705 Rohnert Park Expressway - -- Rohnert Park, CA 94928 Assessor's Parcel Numbers 143 - 391 -053 and -054 Dear Ms. Ellena: Pursuant to the Agreement for Services effective October 11, 2005, the crockencompany has completed an appraisal of the above - referenced real property located within the corporate limits of the City of Rohnert Park in Sonoma County, California. The subject property consists oftwo separate Assessor's Parcel Numbers and is appraised under the hypothetical condition that the two lots are one developable ±81,587 square foot site with a High Density Residential zoning and consistent General Plan designation ( "Subject"). The Subject is more fully discussed within the attached report. The purpose of this appraisal assignment is to provide an opinion of the market value of the fee simple interest in the Subject, under the requested valuation premise, as of the effective valuation date. Based upon the physical inspection of the Subject, which was conducted by the appraisers on November 1, 2005 and upon the subsequent research and analysis undertaken, it is concluded that as of the valuation date of November 1, 2005, the opinion of market value of the Subject, subject to the assumptions and conditions of value herein, is as follows: ONE MILLION SIX HUNDRED THIRTY THOUSAND DOLLARS ($1,630,000) The complete summary narrative report that follows includes the identification of the Subject; geographic, economic and physical data germane to the area and the neighborhood; comparable sales data-, the results of the research and analysis; and the reasoning leading to the conclusions set forth. voice 707.538.7771 4171 old vineyard lane fax 707.538.7779 santa rosa ca email realprop @thecrockerscom 95404 -1330 www. thec rocker* corn Cas Ellena Page 2 December 1, 2005 This complete summary appraisal report conforms to the appraisers' interpretation of the current requirements of the Uniform Standards of Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the Appraisal Foundation. Further, the concluded opinion of market value is subject to the Statement ofAssumptions and Limiting Conditions and Certifications and the special conditions-of value set forth in the Property Summary and Conclusion of Value_ The attached appraisal report contains 48 pages and a 13 -page Appendices. The report in its entirety, including all assumptions, limitations and conditions of value, is prepared for the intended user, the City of Rohnert Park and its named designees only, solely for the use set forth in the report. No other uses or users are intended. It has been a pleasure to work with you on this assignment. Should you have any questions regarding the Subject, please do not hesitate to contact us. Very truly yours, onald J. Croc r, PrAl, SRA CA License Number AGO08219 License Expiration: 12.08.06 RJC /LDC: at Attachment Linda Darnel rocker CA License Number AG 008075 License Expiration: 1.14.07 the crocker.company i 8 a q � ' a a :* v 4 R a 8 jp b ' a a :* v 4 r p � , n 1 S jp b 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company TABLE OF CONTENTS SECTION 1. INTRODUCTION Table of Contents .................... ............................... 1 Property Summary and Conclusion of Value .............................. 2 Statement of Assumptions and Limiting Conditions ................... . ..... 4 Certifications ........................ .................... ........... 6 Purpose of the Appraisal ................ ..............................8 Intended Use /Intended Users of the Appraisal .............................. 8 Scope of Work ...................... ...... ......................... 8 Definition of Terms ...... _ ............ _ .......... 9 Property Rights Appraised ............ ............................... 10 Effective Valuation Date . _ . . . • . . ................... . .......... 10 Ownership /Recent Sales History of the Subject ........................... 10 Identification/Legal Description of the Subject ............................ 10 Real Property Tax and Assessment Data ................................ 11 SECTION 11. DESCRIPTION AND ANALYSIS Area Description.... ................................................... 12 AreaMap ...................................................... 16 Neighborhood Description ............ ............................... 17 Neighborhood Map ............... ............................... 18 Site Description ............................ ...................... 19 Assessor's Parcel Map .........:.. ............................... 22 City of Rohnert Park Zoning Map . .. . ..... . . .......... . ............. 23 Photographs of Subject and Environs ........................ . . .... . 24 Highest and Best Use ................ ............................... 27 Market Conditions ................... ............................... 29 Valuation Methodology ......... ............................... . ..... 32 SECTION III. VALUATION Sales Comparison Approach ......... ............................... 33 Comparable Land Sales ..................:...... . ................ 34 Sale Number ............... ...................... ......... 34 Sale Number ............... ............................... 36 Sale Number .............................................. 38 SaleNumber ............... ............................... 40 Comparable Sales Locational Map . ............................... . . 42 Summary of Sales and Adjustments ............. 43 Analysis and Conclusion ....... . . ...................... . ......... 44 Opinion of Market Value ............................. _ .......... 47 Marketing and Exposure Time ............. . ........................ . 48 APPENDICES • Qualifications /License • Agreement for Services 05- 534- 94/City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocket.company PROPERTY SUMMARY AND CONCLUSION OF VALUE PROPERTY IDENTIFICATION Property Type: ► Jurisdiction: ► Address: ► Census Tract/Map Code: ► Assessor's- Parcel- Numbers: Vacant land Incorporated City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 1512.01/424-D4 143 -894- 0-53 -and -054 ► Site Area: Per Parcel Map No. 142 APN 143- 391 -053: ±68,607 sf ( ±1.575 acres) APN 143 - 391 -054: ±12,980 sf (±0.298 acres) Total ± 81,587 sf ( ±1.873 acres) ► Site Description: The Subject is a triangularly shaped site comprising two contiguous parcels with approximately 290 feet of frontage on Rohnert Park Expressway; site topography is generally level to gently upsloping; vegetation comprises non - native grasses and riparian vegetation along the Laguna de Santa Rosa. ► Improvements: None ► General Plan Land Use: ► Zoning: ► Highest and Best Use: OPINION OF MARKET VALUE ► Bonded Indebtedness: EXPOSURE/MARKETING TIM INTEREST APPRAISED EFFECTIVE DATES ►Date of Report: ►Date of Valuation: Open Space /Appraised as Residential -High Density OS -EC: Open Space - Environmental Conservation Appraised as R =H: Residential -High Density Development consistent with City of Rohnert Park Residential -High Density zoning /land use policies $1,630,000 None Less than one year Fee simple December 1, 2005 November 1, 2005 015-534 -94 /City of Rohnert Park 2 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company PROPERTY SUMMARY AND CONCLUSION OF VALUE CONDmONS OF VALUE The concluded opinion of market value for the subject is conditioned upon the Statement of Assumptions and Limiting Conditions and Certifications on the following pages, as well as the following special conditions of value. ❑ The Subject currently consists of two separate assessor's parcels. Rohnert Park Parcel Map No. 142 recorded December 20,1991, indicates a total site size of ±1.873 acres for the two parcels. The Sonoma County Assessor's Office indicates a total parcel size of ±1.93 acres. The opinion of market value is based on the hypothetical condition that the Subject is a single developable site comprising ±81,587 square feet. The crocker.company expressly reserves the right to amend the concluded opinion of value should there be a_. material _ change in the Subject's land area. ❑ A recent Environmental Site Assessment (ESA) for the Subject site was not provided to the appraisers. The concluded opinion of market value is predicated on the extraordinary assumption that there exist neither on the Subject nor adjacent properties any known or unknown soils and /or groundwater contamination; toxic chemicals, toxic molds, toxic wastes, or hazardous substance releases of any kind that would adversely impact the Subject's development capacity and /or its market value. ❑ A recent Preliminary Report for the Subject site was not available for review by the appraisers. A Preliminary Report prepared by North Bay Title Company issued as of December 3, 1997 for Assessor's Parcel Number 143- 391 -053 was provided by the Client. Both the issue date and the lack of completeness render the report unreliable in terms of the existence of easements and CC &R's as of the valuation date. The concluded opinion of market value is based on the extraordinary assumption that there exist no easements, encroachments, or private CC &R's on the either the Subject or surrounding properties that would adversely impact the Subject's development capacity and /or its market value. ❑ The concluded opinion of market value is predicated on the extraordinary assumption that the Subject site has direct access from the existing driveway at its easterly boundary and, further, that direct westbound access from Rohnert Park Expressway is allowed. ❑ The Subject is currently zoned OS -EC: Open Space Environmental Conservation District which is consistent with the Open Space general plan. Pursuant to the Agreement, the Subject is appraised under the hypothetical condition that it carries a High Density Residential zoning and consistent general plan. The concluded opinion of market value assumes that re- zoning and General Plan amendment of the Subject site are complete and that the site is ready for development. ❑ Recent soils, hydrology, orgeotechnical studies on the Subject site were not provided to the appraisers. The concluded opinion of value is predicated on the extraordinary assumption that the Subject site is capable of development in accordance with the City of Rohnert Park General Plan, Zoning Ordinance and other land use documents and polices, and further, that there exist no jurisdictional wetlands, endangered species or biotic resources that would adversely impact the Subject's development capacity and /or its market value. 05- 534 -94 /City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS Before making any decision based on the information and analyses contained in this report, it is important to read this entire section to understand these limitations. Survey. The Subject's gross site size of ±81,587 square feet is based on information contained in Rohnert Park Parcel Map 142, recorded 9.20.91. The reliability of the information contained on such map is assumed by the appraisers and cannot be guaranteed. Should there be a material change in the site size based on data available subsequent to the appraisal date, the concluded opinion of value may be affected. Title. The Preliminary Report provided for the Subject is outdated and incomplete. No responsibility is assumed for legal matters that affect title to the Subject nor is an opinion of title rendered. The concluded opinion of market value is provided without regard to any questions of title, boundaries, encumbrances, or encroachments. It is further assumed that there is full compliance with all applicable federal, state, and local environmental regulations and laws unless non - compliance is stated, defined, and considered in the appraisal report. Further, it is assumed that all required licenses, consents, or other legislative or administrative authority from any local, state, or national government, private entity or organization have been or can be obtained or renewed for any use on which the opinion of value in this report is based. Engineering, Property Inspection Reports. Engineering analyses of the Subject site were neither provided for use by the appraisers nor made as a part of this appraisal assignment. The concluded opinion of market value is predicated on the extraordinary assumption that there are no hidden or unapparent conditions of the property, sub - soils, or structures that would render the property more or less valuable. No responsibility is assumed for such conditions, nor for the engineering that may be required to discover such factors. Sub - surface rights, including mineral and oil, were not considered in the valuation process. Environmental Issues. It is assumed that there is full compliance with all applicable federal, state, and local environmental regulations and laws, unless non - compliance is stated, defined, and considered in this appraisal report. The appraisers are not environmental experts and do not have the expertise necessary to determine the existence of toxic chemicals, toxic molds, toxic wastes, or the release of any hazardous substances on the Subject or surrounding properties. If any known problems of this nature exist, they are disclosed in this report. However, non - disclosure should not be taken as an indication that such a problem does not exist. Appraisal Data. Information provided by local sources, such as employees and representatives of government agencies, financial institutions, accountants, architects, attorneys, engineers, planners, real estate professionals and others is assumed to be true, correct, and reliable. The comparable land sales and data relied upon in this appraisal are believed to be from reliable sources_ No responsibility for the accuracy of such information is assumed by the appraisers. The concluded opinion of value is based on the appraisers' analyses as of the valuation date. The crocker.company expressly reserves the right to make such adjustments to the concluded opinion of value, as may be required by consideration of additional or more reliable data that may become available subsequent to the valuation date. 05- 534 -94 /City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS Intended Use and Intended User of Appraisal. This appraisal was prepared at the request of and for the exclusive use of the City of Rohnert Park ("Client"), and is intended for the exclusive use of the Client and its named designees for the purpose of assisting in the decision - making process regarding potential disposition of the Subject. There are no other intended uses or users of the appraisal report. Any third party, not covered, who may possess a copy of the report, is advised that he /she should rely on his /her own independently secured advice for any decision in connection with the Subject. Notwithstanding the above, possession of this report, or a copy thereof, including electronic media discs, does not carry with it a right of publication. Neither all nor any part of the contents of this report shall be conveyed to the public through advertising, public relations, news, sales, or other -- - media without tie written consent of the appraisers. Nor shall the appraisers, firm, or professional organization of which the appraisers are members be identified without the written consent of the crocker.company. Neitherthe appraisers northe crocker.company assumes any liability for harm caused by reliance upon an unauthorized, incomplete or altered copy of the appraisal report, inclusive of Appendices, distributed to non - intended users of the report. Expert Testimony. There are no requirements, by reason of the completion of this appraisal, to give testimony or appear in court or any pre -trial conference or appearance required by subpoena with reference to the property in question, unless a supplemental contract for such services has been executed by the Client and the crocker.company_ Appraised Value_ Opinions and conclusions of value as contained within this report are valid only when making a summation for this particular site; they are not to be used independently for any purpose and are considered invalid if so used. 05- 534 -94 /City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company CERTIFICATION Pursuant to USPAP Standards Rule 2 -3, 1 certify, to the best of my knowledge and belief, that 1. the statements of fact contained in this report are true and correct. 2. the reported analyses, opinions, and conclusions are limited only bythe reported assumptions and limiting conditions, and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions. 3. 1 have neither a present nor a prospective interest in the property that is the subject of this appraisal, and I have no personal interest with respect to the parties involved. 4. 1 have no bias with respect to -t--h-e -- property that is the subject_ of this. appraisal or t9 the parties _ involved with this assignment. 5. neither my engagement in this assignment nor my compensation for completion of this assignment is contingent upon the development or reporting of a predetermined value ordirection in value that favors the cause of the Client, the amount of the opinion of market value, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 6. 1 have made a personal inspection of the real property that is the subject of this appraisal. 7. no one provided significant real property appraisal assistance to the persons signing this report. 3. my analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the appraiser's understanding of the requirements of the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal Institute and further, the use of this report is subject to the Appraisal Institute's requirements for review by its duly authorized representatives. 9. as of the date of this report, I have completed the requirements under the continuing education program of the Appraisal Institute and am not subject to any investigation regarding ethical rules of the Appraisal Institute. 10. my analyses, opinions, and conclusions were developed, and this report has been prepared, in conformitywith the appraiser's interpretation of the requirements of the current Uniform Standards of Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the Appraisal Foundation. 11. the appraiser meets all of the requirements of the Competency Rule and competency provisions of the current Uniform Standards of Professional Appraisal Practice (USPAP) in orderto complete the assignment in a competent manner. 12. this appraisal assignmentwas not based on a ted minimum valuation, a specific valuation, or the approval of a loan. DATE R ALD J. CRO E , Al, SRA Certified General Real Estate Appraiser CA OREA License Number AGO08219 License Expiration: 12.08.06 05- 534 -94 10ty of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company CERTIFICATION Pursuant to USPAP Standards Rule 2 -3, 1 certify, to the best of my knowledge and belief, that the statements of fact contained in this report are true and correct. 2. the reported analyses, opinions, and conclusions are limited only bythe reported assumptions and limiting conditions, and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions. 1 have neither a present nor a prospective interest in the property that is the subject of this appraisal, and I have no personal interest with respect to the parties involved. 4. _ 1 have no bias with respect to the property that is the subject of this appraisal or to the parties involved with this assignment. 5. neither my engagement in this assignment nor my compensation for completion of this assignment is contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the Client, the amount of the market value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 6. 1 have made a personal inspection of the real property that is the subject of this appraisal. 7. no one provided significant real property appraisal assistance to the persons signing this report. 8. my analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the appraiser's understanding of the requirements of the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal Institute and further, the use of this report is subject to the Appraisal Institute's requirements for review by its duly authorized representatives_ 9. my analyses, opinions, and conclusions were developed, and this report has been prepared, in conformitywiththe appraiser's interpretation of the requirements of the current Uniform Standards of Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the - Appraisal Foundation. 10. the appraiser meets all of the requirements of the Competency Rule and competency provisions of the current Uniform Standards of Professional Appraisal Practice (USPAP) in orderto complete the assignment in a competent manner.. 11. this appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of a loan. DATE LINDA DARNVL CROCKER Certified General Real Estate Appraiser CA OREA License Number AGO08075 License Expiration: 1.14.07 05- 534 -94 /City of Rohnert Pork 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company PURPOSE OF THE APPRAISAL Pursuant to the Agreement for Consulting Services effective October 11, 2005, ( "Agreement"), a copy of which is included in the Appendices, the purpose of this appraisal assignment is to provide an opinion of the market value of the fee simple interest in the Subject under the d Conditions of Value stated herein. INTENDED USE /INTENDED USERS OF THE APPRAISAL This report has been negotiated with Cas Ellena, Housing and Redevelopment Project Manager, and is intended for the exclusive use of the City of Rohnert Park ( "Client'), and its named designees, to aid in or support decisions relating to potential disposition of the Subject property. There are no other intended uses or intended users. Neither the report in its entirety nor any part of the appraisal is valid for use by or reliance upon by any other parties, either presently or at any time in the future, without the express written consent of the crocker.company. SCOPE OF WORK The scope of work for the current appraisal assignment consists of the preparation of a Complete Summary Appraisal prepared in a narrative report format, utilizing only the Sales Comparison Approach to value, to develop the above opinion of market value as of the effective valuation date, in accordance with the appraisers' interpretation of current USPAP requirements, Standards Rule 2 -2(b). The scope of work for this assignment is inclusive of, but not limited to, the following: 1. definition of the appraisal problem; identification of the intended use and the intended user(s) of the report; determination of the applicable valuation date, the property rights to be appraised and the appropriate definition of market value to be appraised; 2. physical inspection of the Subject site and environs; review of documents germane to the assignment, and discussions with City of Rohnert Park staff; 3. development of the valuation assumptions and conditions of value, including any extraordinary assumptions and hypothetical conditions relating to this assignment; 4. research and analysis of relevant local economic, demographic and planning data and selective research in the Sonoma County, Rohnert Park/Cotati and Santa Rosa (sub)markets; 5. conclusion of an opinion of the highest and best use of the Subject site, as though vacant and unencumbered, based on an analysis of applicable City of Rohnert Park zoning and land use policies and regulations; 6. market research for, verification of, and analysis of relevant land sales transaction data; sources utilized, in addition to the crockencompany data files, include public records; market research firms; multiple listing services; real estate professionals and developers engaged in marketing and development of similar types of properties; and other public and private sources; 05- 534- 94/City of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SCOPE OF WORK 7. visual inspection and analysis of all comparable land sale properties, insofar as practicable, recognizing the limitations of physical access to private properties' 8. conclusion of an opinion of the market value of the fee simple interest in the Subject under the extraordinary assumptions and hypothetical conditions stated herein, via the Sales Comparison Approach; and 9. conclusion of an opinion of exposure time required for consummation of a sale of the Subject and reasonable marketing time in order to effectuate a sale of the Subject under the requested appraisal premise, as of the effective valuation date. DEFINITION OF TERMS Market Value "Market value"' is defined, for purposes of this assignment, as follows: The most probable price which a property should bring in a competitive and open market under =all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised, and acting in what they consider their best interests; (3) a reasonable time is allowed for exposure in the open market; (4) payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and (5) 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. Fee Simple "Fee simple estate "2 is defined as follows: Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed bythe governmental powers of taxation, eminent domain, police power, and escheat. Appraisal Institute, The Dictionary of Real Estate Appraisal, Chicago, Illinois (Fourth Edition, 2002), pp_ 177- 178. 2 Id., p.113. 05- 534- 9410ty of Rohnert Park 9 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company PROPERTY RIGHTS APPRAISED The property rights appraised are the fee simple interest in the Subject land only. Assessment bonds, if any, are assumed to be paid as of the effective valuation date. EFFECTIVE VALUATION DATE The date of the last physical inspection of the Subject site is contemporaneous with the valuation date, which is November 1, 2005. OWNERSHIP /RECENT SALES HISTORY OF SUBJECT - Title.- According -to- Sonoma - County _ records; -title to- the - Subject is vested as follows: The City of Rohnert Park, a Municipal Corporation Sales History. According to public records, title to APN 143 - 391 -053 was vested in the City of Rohnert Park on December 23, 1997, and title to APN 143 - 391 -054 was vested in the City of Rohnert Park on January 22, 1992. There are no other known transfers of the Subject recorded within the past three years. The crocker.company is unaware of any purchase agreements, options to purchase or ground leases on the Subject as of the effective valuation date. IDENTIFICATION /LEGAL DESCRIPTION OF THE SUBJECT The Subject is located south of Rohnert Park Expressway approximately ±1,150 feet west of its intersection with Labath Avenue at the edge of the corporate limits of the City of Rohnert Park. The Subject consists of two separate parcels appraised as a single development site, and identified as Assessor's Parcel Numbers 143 - 381 -053 & -054, which parcels are commonly referred to by the address of 705 Rohnert Park Expressway, Rohnert Park, CA 94928. The legal description of the Subject, based on recorded documents, is as follows: The land referred to herein is situated in the State of California, County of Sonoma, City of Rohnert Park, and is described as follows. PARCEL ONE: LOT ONE, AS SHOWN ON THE MAP ENTITLED ROHNERT PARK PARCEL MAP NO. 142, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SONOMA COUNTY ON DECEMBER 20, 1991, IN BOOK 486 OF MAPS, AT PAGES 7, 8, AND 9, SONOMA COUNTY RECORDS. PARCEL TWO: PARCEL A, AS SHOWN ON THE MAP ENTITLED ROHNERT PARK PARCEL MAP NO. 142, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SONOMA COUNTY ON DECEMBER 20, 1991, IN BOOK 486 OF MAPS, AT PAGES 7, 8, AND 9, SONOMA COUNTY RECORDS. APN :s 143 - 391 -053 and 143 - 391 -054 05- 534- 94/Crfy of Rohnert Park 10 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company REAL PROPERTY TAX AND ASSESSMENT DATA Title to the Subject is currently vested in the City of Rohnert Park, an incorporated municipality. The property is classified as non - taxable due to its public ownership. There are no special assessments on the Subject reported by the Sonoma County Office of the Tax Collector/Treasurer- Special Assessments section. 05- 534 -94 /City of Rohnert Park r a a ee g r a a ee ` � r a a ee r a a a 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company AREA DESCRIPTION Sonoma' County Location: The Subject is located in the west central portion of the City of Rohnert Park in the County of Sonoma, the northernmost of the nine San Francisco Bay Area counties of Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma. The Association of Bay Area Governments (ABAG) in its Projections -2005 ranks Sonoma County sixth in projected population growth and third in jobs growth during the 2000 -2015 time period. Geography: Encompassing an area of 1,589 square miles, Sonoma County ranks twenty -eight in size in the State of California and has the largest land area of any Bay Area county with approximately, 7.7 % of the total land area developed. Santa Rosa, the county seat and business and financ_i_al ce_n_ter,_ is the_largest_Bay Area city_north Qf_San Fsaricisro__The_city'Gensus_ 2000____ __ population of 147,595 reflects a 30.3% increase from 1990. The January 2005 Department of Finance population estimate for Santa Rosa is 156,268, an increase of 0.7% since January 2004. Economy: The Bay Area is the West Coast center for high technology, nanotechnology, biotech and biomedical research and product development firms. Both the state and regional economies were hit hard by the high tech and dot -com collapse in 2000 -2001. Telecom Valley, which includes the Highway 101 Corridor from Novato in Marin County to the Charles M. Schulz- Sonoma County Airport area north of Santa Rosa, is a nationally recognized high technology center, particularly in telecommunications. Although contracting and restructuring within the technology sector has significantly impacted North Bay commercial markets, particularly in Sonoma County's Petaluma and Airport submarkets, most regional economists cite a recovering and diversified economic base. The wine industry is the largest agricultural employer in Sonoma County. Growth in the wine industry slowed in 2001 -02 nationally as well as locally. As of third quarter 2005, the oversupply cycle of the last few years is back into balance, demand for North Coast wine and grapes is strong, and export volume is rising to record levels due to the weakened U.S. dollar. Globalization —with the U.S. a prime market for Australian, European and South American exporters —keeps competition very keen and continues to foster consolidation within the industry. Tourism follows technology, wine and health care as the county's leading industries. Now a billion dollar plus annual industry, Sonoma County's tourism has increased steadily over the past decade. Regional surveys by PKF Consulting as of Second Quarter 2005 indicate a measurable increase in both occupancy rates ( +3 %) and average daily room rates ( +15 %) for the Sonoma /Napa market on a year -over -year comparison basis, leading all Northern California markets. Tourism in the North Bay, particularly the Sonoma -Napa Wine Country, is well - positioned for strong growth as leisure travel "drive destinations" continue their popularity and projected economic growth in the BayArea brings increased business travel to the North Bay. Population: The Census 2000 population for the county is 458,614, reflecting an increase of 18.1 % since 1990, which is substantially higher than the state's 13.8% growth rate for that decade. Although the county's population increased significantly between 1990 -2000, the rate of growth is projected to slow considerably over ABAG's 30 -year forecast period. ABAG's Projections -2005 indicates that the county's population from 2000 to 2015 is expected to increase by 14 %, then slow to 7% for the 2015 -2030 projection period, placing Sonoma County near the bottom of the 9 -county Bay Area in terms of population and household growth. 05- 534 -94 1City of Rohnert Park 12 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company AREA DESCRIPTION Sonoma County Population and Projected Growth:- Sonoma County and Its Cities 2009m- $0 Subregional Study Area' 2000 2015 % Change 2000 -2015 2030 % Change 2015 -2030 Santa Rosa 165,849 194,600 17% 216,800 11% Petaluma 55,743 64,000 15% 67,700 6% Rohnert- Park - - - - -- - -- 43,138 -- - .._- _-47;60 -- - - - .._ 10 9/*-- - - - 49,400__ _ 4% Windsor 22,744 28,800 27% 31,700 10% Healdsburg 11,253 13,800 23% 14,600 6% Sonoma 9,754 11,600 19% 11,900 3% Sebastopol 8,108 8,500 5% 8,800 4% Cotati 7,279 8,800 21% 9,600 9% Cloverdale 7,052 10,800 53% 11,600 7% Unincorporated 127,694 132,700 4% 136,300 3% Total 458,614 521,200 14% 558,400 7% The January 2005 Department of Finance population estimate for Sonoma County is 478,440. The county's General Plan 2020 update is currently in process, with the majority of the county's growth likely to continue to be concentrated within the cities' spheres of influence, controlled through local land use policies such as growth management ordinances, and /or voter - approved urban growth boundaries (UGB), such as that adopted by the City of Rohnert Park_ Open space acquisitions are facilitated via the county's sales tax- funded Agricultural Preservation and Open Space District. Employment: The county's average annual unemployment rate for 2004 is reported by the Employment Development Department as 4.6 %, compared with 4.9% in 2003; 4.5% in 2002; 2.9% in 2001; and 2.1 % in 2000_ The county's reported preliminary unemployment rate as of September 2005 is 4.1 %, as compared with 4.8% reported for both California and the U.S_ (All data cited are not seasonally adjusted.) According to EDD, Sonoma County's total jobs loss during the 2001 -2003 recession was 7,600, significantly less than previously reported. Jobs growth in Sonoma County was reported at 2,500 for 2004, led by the construction and leisure and hospitality sectors. Projected jobs growth is highest in the construction and service industries, while jobs losses are centered in high -tech manufacturing, management and insurance. Manufacturing jobs continue to be lost to "offshoring" and relocation, and higher salaried technology and manufacturing jobs are being replaced by lower paying service sector jobs. Anticipated growth projections for the biotech /biomedical sectors, as well as medical test and measurement development, are optimistic. ' ABAG's Projections -2005 includes population for cities' spheres of influence (SOI) as contrasted with jurisdictional boundaries for incorporated areas, which may have a slightly lower population_ 05- 534 -94 /City of Rohnert Park 13 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company AREA DESCRIPTION City of Rohnert Park The cities of Rohnert Park and Cotati, which share common boundaries, are located on U.S. Highway 101, midway between Santa Rosa and Petaluma, and approximately 36 miles north of San Francisco along Highway 101, the major arterial north of San Francisco. Rohnert Park is a master planned community that encompasses an area of 6.9 square miles. The third largest city in Sonoma County, Rohnert Park had a Census 2000 population of 42,236, which represents an increase of 16.27% for the 1990 -2000 decade. The Department of Finance January 2005 population estimate for the city, is 42,445. The General Plan population at 2020 buildout is projected at 50,400, which represents an average annual growth rate of 1.0 % for the 20 -year period. At General Plan buildout, approximately 1,260 net acres would be developed within the UGB WWl-tfi an arc di onai 56 acres outside -the UGB developed fof community fiei s and 550 acres - for parks and open space. The City's General Plan adopted in July 2000 includes five specific plan areas for proposed development, in addition to the City Center special study area, which will provide new opportunities for both commercial and residential development. Rohnert Park Population, Jobs and Income Projections' 2000 -2030 The original 1954 master plan for the community was based on the "neighborhood unit" concept of clustering single family homes around local schools and parks. The first homes in Rohnert Park were constructed in 1958, and following incorporation in 1962, the city's then 2,775 population experienced rapid growth through the 1980's, with a 274% increase from 1970 -1980 and a 58% increase from 1980 -1990. However, growth has been less than 1% per year since 1990. The average annual growth rate projected in ABAG's Projections -2005 for the 2000 -2015 time period remains at less than 1 %, and decreases to less than 0.5% for the 2015 -2030 projection period. It should be noted that these recent projections vary slightly from the older general plan data. ABAG'S Projections -2005 includes population for Rohnert Park's Sphere of Influence (SOI) pursuant.to the July 2000 General Plan, which is slightly higher than the population for the incorporated jurisdictional boundary. 05- 534 -94 10ty of Rohnert Park 14 2000 2015 % Change 2000 -2015 2030 % Change 2015 -2030 Population 43,138 47,600 10% 49,400 4% Households 15,697 17,780 13% 18,410 4% Employed Residents 23,671 27,460 16% 32,770 19% Total Jobs 17,940 24,110 34% 39,340 63% Mean House- hold Income $67,600 $79,000 17% $94,100 19% The original 1954 master plan for the community was based on the "neighborhood unit" concept of clustering single family homes around local schools and parks. The first homes in Rohnert Park were constructed in 1958, and following incorporation in 1962, the city's then 2,775 population experienced rapid growth through the 1980's, with a 274% increase from 1970 -1980 and a 58% increase from 1980 -1990. However, growth has been less than 1% per year since 1990. The average annual growth rate projected in ABAG's Projections -2005 for the 2000 -2015 time period remains at less than 1 %, and decreases to less than 0.5% for the 2015 -2030 projection period. It should be noted that these recent projections vary slightly from the older general plan data. ABAG'S Projections -2005 includes population for Rohnert Park's Sphere of Influence (SOI) pursuant.to the July 2000 General Plan, which is slightly higher than the population for the incorporated jurisdictional boundary. 05- 534 -94 10ty of Rohnert Park 14 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company AREA DESCRIPTION City of Rohnert Park Although a majority of the city's employed residents commute to Santa Rosa, Marin County and San Francisco, Rohnert Park has developed an employment base of its own, with a job base in excess of 20,000. Approximately 200 commercial and industrial businesses are currently located within the city limits. Hewlett Packard, now Agilent Technologies, was one of the city's largest employers until 2004 when it closed its Rohnert Park facility due to consolidation in Santa Rosa. Sonoma State University ( "SSU "), although located outside the city's Sphere of Influence, has approximately 1,500 employees and a Fall 2004 enrollment of approximately 8,000 students. The Master Plan calls for approximately 9,000 students by 2010; however enrollment up to a 73% increase in the next 10_years is _a possibility. a_s_.the_ pressure _for _growth _to meet-rising-demand-at_ the 23- campus California State University system continues. SSU's projected accelerated growth could have substantial impact on Rohnert Park and surrounding communities. The 300 -acre University District Specific Plan Area, a large mixed -use project slated for development north of the campus —with 1600 new homes and an approximately ±25,000 square foot commercial district around a small town square —will act as a gateway between the city and campus. Planned redevelopment of the 200 -acre former Agilent Technologies site in the city's southeast quadrant into a high tech business park together with a mixed -use retail and high density housing "urban village ", will further positively impact the east side and facilitate SSU's projected growth. The Federated Indians of the Graton Rancheria has proposed what would be the largest gaming casino /resort hotel in Sonoma County on land located in the northwest quadrant of Rohnert Park. The status of this proposal is uncertain at this time. Preliminary EDD data reports a labor force of 25,800 for the City of Rohnert Park and an unemployment rate of 3.8% as of September 2005, which is slightly lower than the county's reported rate of 4.1%. ABAG, in its 2000 -2015 projections, estimates an increase of 34% in the number of jobs, with a significantly lower increase in the number of employed residents (16 %). A similar imbalance in jobs and employed residents is projected for the 2015 -2030 time period (63% vs. 19%). Rohnert Park has a 2005 estimate of 2.62 persons per household as compared with 2.56 for the county. Mean household income for 2005 is estimated at $69,600, somewhat lower than the $73,500 for the county. Conclusion While jobs growth suffered in the economic downturn in 2001 — particularly in the telecom and technology sectors —the overall health of the county's diverse economy remains good, with modest growth projected in 2005, and solid economic growth over the long -term. The city of Rohnert Park is well located midway in the Telecom Valley /101 Corridor, and will continue to play an important role as the county and its cities becomes increasingly more integrated into the overall Bay Area economy. A stable real estate market is projected overthe long -term, with commensurate increases in real property values likely, in both the residential and commercial /industrial sectors. 05- 534 -94 /City of Rohnert Park 15 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company AREA MAP u5- 53494 10ty of Rohnert Park 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company NEIGHBORHOOD DESCRIPTION The Subject is located within a primarily commercial mixed -use neighborhood in the extreme westerly central area of the city of Rohnert Park. U.S. Highway 101 divides the city into two unequal parts with the majority of the residential development— comprising 44% of the city's total land use distribution -- located on the east side. The city's major industrial centers are located north of the Rohnert Park Expressway ("Expressway") on both the east and west sides of the freeway. Commercial land uses are designated both north and south of the Expressway, a four -to -six lane major arterial that bisects the city in an east/west direction. The 101 /Expressway interchange is approximately %2 mite east of the Subject. The 101/Wilfred Avenue/Golf Course Drive interchange is approximately 1 %2 mile northeast. The Wal -Mart Plaza— including the Wal -Mart and Home Depot stores —and numerous national and regional retail and restaurant chains are located west of the U.S. 101/Wilfred Avenue interchange.___ Rohnert Park does not have a historic central business district. The City Center special study area east of the freeway just north of the Expressway, includes institutional, professional and medical office uses, commercial banks and retail centers. Still in a transitional state, City Center is home to the Regional Public Library and Public Safety headquarters, two mixed -use developments under construction, and a vacant site for future City offices. Major retail centers, each anchored by a supermarket, on the east side of Rohnert Park are: Padre Town Centre between-State Farm Drive and Commerce Boulevard; Park Plaza at the intersection of Commerce Boulevard and the Expressway; and Raley's Town Centre at the intersection of Expressway and State Farm Drive. Zoning and land uses within the immediate neighborhood include Regional Commercial along the Expressway east of the Subject; Medium -High Density Residential uses north of the Subject include multi - family residential and a mobile home overlay; Community Separator to the west; and Rural Residential uses within the Sphere of Influence of the City of Cotati to the south. Commercial, Industrial and Publictinstitutional uses are located north of the Hinebaugh Creek Channel, maintained by the Sonoma County Water Agency. Currently underdeveloped land to the north of the subject neighborhood, including the site of the former Crushers Baseball Stadium, is planned for mixed -use development. The subject neighborhood, together with the Wal -Mart Plaza approximately one mile north, comprise the core regional commercial area west of the freeway. Expressway Center, an approximately ±750,000 square foot off -price regional center, is the focus of the subject's commercial neighborhood. Current uses include the Pacific Cinemas Theatre 16- screen complex, Target, Greenwood Home Furnishings, Burlington Coat Factory, Anna's Linens, Food Maxx, PetsMart, several restaurants, and smaller in -line shops. Pacific Plaza, a newer approximately ±18,000 square foot retail center, and Office Depot are adjacent at the Labath /Expressway intersection. An Applebees's Grill and Bar and the 232 -unit Redwood Creek Apartments complex are recently completed construction at Labath and Expressway. The area's newest Costco is on Redwood Drive, approximately 1/4 mile from the Subject. Claritas demographics show a fairly dense population as of 2004 of approximately 80,996 people within a 5 -mile radius of the Expressway /101 intersection. The neighborhood is served by Sonoma County transit for intra -county service and Golden Gate Transit for service south to Marin and San Francisco. A CalTrans Park 'N Ride lot is located at the 101 /Expressway interchange. In summary, the subject neighborhood enjoys good freeway access and visibility, serves a regional clientele in addition to local residents, and has a high commercial traffic volume, with continued development planned. No conditions that would adversely impact value were noted. 05- 534 -94 /City of Rohnert Park 17 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company NEIGHBORHOOD MAP 05- 534 -94 /City of Rohnert Park 18 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SITE DESCRIPTION Location. The Subject is located south of Rohnert Park Expressway approximately ±1,150 feet west of its intersection with Labath Avenue in the corporate limits of the City of Rohnert Park. The Subject consists of two separate parcels- appraised as a single developable site identified as Assessor's Parcel Numbers 143 - 381 -053 & -054 which parcels are commonly referred to by the address of 705 Rohnert Park Expressway, Rohnert Park, CA 94928. SizelTopography. The Subject is a triangularly- shaped site, generally level at street grade to gently upsloping site, with gross areas, pursuant to Parcel Map 142, prepared by M. Hudis & Associates and recorded 12.20.91, as follows: APN 143- 391 -053 _±68.607 square feet APN 143 - 391 -054 ±12,980 square feet Total Site Size ±81,587 square feet ( ±1.873 acres) The Laguna de Santa Rosa, owned and maintained underthe aegis of the Sonoma County Water Agency, forms the southerly boundary of the Subject site. Site vegetation comprises non- native grasses and riparian vegetation along the Laguna. The concluded opinion of market value is based on the hypothetical condition that the two parcels are a single developable site. Zoning/General Plan. The Subject is currently zoned OS -EC: Open Space for Environmental Conservation. This zoning district is intended to allow for greenbelts and urban buffers. The sites that carry EC zoning include those with environmental and /or safety constraints such as riparian corridors, sensitive habitats, and wetlands. Pursuant to the Agreement, the Subject site is appraised under the hypothetical condition that it is re -zoned to R -H: Residential -High Density District and a General Plan consistency of High Density Residential. The High Density Residential land use designation is intended to permit a wide range of housing types, ranging from single- family attached to multi - family, and is intended for specific areas where higher densities may be appropriate. Permitted uses allowed as of right under the R -H zoning, include multi - family dwellings with densities of 12 to 30 units per acre, small day care homes, small family care /community care homes, small homeless shelters, and small recovery facilities, small residential care facilities, and public facilities (subject to PC review). Minimum lot size is 10,000 square feet and maximum building height is 45 feet_ The building setback line is 35 feet. (See discussion of setback in CC &R's, below). Off - street parking is required pursuant to Chapter 17.16. Off -site lmprovements/Access. Access to the Subject is via Rohnert Park Expressway, a city- maintained hard - surfaced four -lane street with two traffic lanes in each direction and a landscaped median. The street is improved with curbs, gutters, sidewalks and streetlights. Freeway access with both north and south bound ramps is approximately 3/4 mile east at the Highway 101 / Rohnert Park Expressway interchange. The access to the Subject is assumed to be a common driveway shared with the adjacent shopping center site to the east of the Subject, via reciprocal easements as detailed in the CC& R's, discussed below. Utilities. All public utilities, including water, sewer, natural gas, electricity and telephone are available to the site and all are underground on the Expressway. 05- 534 -94 /City of Rohnert Park 19 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SITE DESCRIPTION Easements/Encroachments/CCBR's. The dated Preliminary Report prepared by North Bay Title with an issue date of December 3, 1997 lists the following exceptions to title: Exception 4. Covenants, Conditions, and Restrictions contained in Declaration of Restrictions dated May 2, 1991 under Document No. 1991- 0039745; Exception 5. Easement in favor of Pacific Gas and Electric for communication and electrical distribution, and underground pipes affecting a portion of Parcel 143- 391 -053 (Subject); Exception 6. Building setback line affecting the northerly 35 feet; Exception 7. Easement for public utilities affecting the northerly 10 feet; Exception 8. Easement in favor of the City of Rohnert Park for wastewater reuse pipeline and related appurtenances (and temporary construction) affecting a southerly and southwesterly portion. The precise location of some of the easements was not readily discernible and due to the age of the preliminary report, it may or may not be reflective of current conditions. The recorded Covenant, Conditions and Restrictions Agreement ( °CC &R's ") referenced above is between the owners of the adjacent shopping center parcel and the owner of a larger parcel which included the Subject. The CC &R's provide for reciprocal. easements for the common driveway (which is currently the rear access to the existing Food Maxx located at 605 Rohnert Park Expressway); a no -build area with height restrictions; a prohibition against fencing or partitioning of any kind between the two parcels; and certain use restrictions. It is not known whether the CC &R's have been subsequently amended_ Copies of the above - referenced documents are retained in the appraisers' file. The concluded opinion of value is predicated on the extraordinary assumption that there exist no easements, with the Subject as either the dominant or servient tenement, encroachments or private CC &R's that would affect the _ Subject's utility and /or market value under its concluded highest and best use. Redevelopment Project Area. The Subject is included within the Rohnert Park Community Development Project Area and is subject to the provisions of the Redevelopment Plan, as amended. Inclusion within this Area is not considered to have an adverse impact on the Subject. Flood Hazards. According to the National Flood Insurance Data Map provided by FEMA, the Subject site is not located within a 100 -year flood plain requiring flood insurance. (Community Panel Number 060380 0001 B, effective date June 1, 1981). The Subject's southerly boundary borders the Laguna De Santa Rosa flood control channel owned and maintained by the Sonoma County Water Agency. Seismic Hazards. The Subject is not located within an Earthquake Fault Zone pursuant to the Alquist -Priolo Special Studies Zone Map for the Cotati Quadrangle, effective July 1, 1983, although it should be noted that the city of Rohnert Park is located within a seismically active area, as is all of Sonoma County. 0&53494 /City of Rohnert Park 20 705 Rohnert Park Expressway Rohnert. Park CA 94928 the crocker.company SITE DESCRIPTION Wetlands/Biotic Resources. The Client did not provide any information regarding the existence of disturbed seasonal wetlands or endangered species on the Subject site. The General Plan does not indicate the Subject site as having a high or moderate potential for wetlands. However, the Subject's current zoning and general plan land use designation are indicative of the existence of environmentally sensitive factors. The general vicinity is identified as the habitat area of the Northwestern pond turtle and the Western Yellow- billed Cuckoo. The concluded opinion of value herein is predicated on the extraordinary assumption that there are no wetlands/biotic resources on either the Subject or adjacent properties that would adversely impact the Subject's utility and /or market value. Archaeological --Historic Resource & -No_ archaeological -reconnaissance. -or__cultural ._resource___ survey of the Subject site was available for review by the appraisers. It is noted that Rohnert Park is located in an area that was inhabited by Coast Miwok and Southern Porno Indians, with the possibility of further discovery of native American cultural resources. The concluded opinion of value is predicated on the extraordinary assumption that there are no archaeological, cultural or historic resources either on the Subject or adjacent properties that would adversely impact the Subject's utility and/or market value. Environmental Issues. Rohnert Park is under the jurisdictional authority of the North Coast Regional Water Quality Control Board for water quality and the northern region of the Bay Area Air Quality Management District for air quality. Neither, a geotechnical nor an Environmental Site Assessment for the Subject site was not available for review by the appraisers. The appraisers do not have the expertise necessary to determine the existence of toxic chemicals, toxic molds, toxic wastes, or other potentially hazardous substances, or the release of any hazardous substances on the Subject or surrounding properties. The concluded opinion of value is predicated on the extraordinary assumption that the Subject may be improved to its highest and best use and that there exist neither on the Subject nor on surrounding properties any soils instability, any soils or groundwater contamination, chemical wastes or toxic wastes, hazardous building materials or other hazardous substance releases of any kind that would adversely impact the Subject's utility and /or market value. Entitlements. The Subject is appraised under the hypothetical condition that the R -H zoning and general plan are in place and that the Subject site may be developed under applicable land use policies and regulations. Improvements. APN 143 - 391 -054 was a former well site for the City of Rohnert Park. The concluded opinion of value is based on the extraordinary assumption that the Subject site is vacant and ready for development under the R -H zoning and general plan. Conclusion. The Subject is well- located at the periphery of a mixed -use neighborhood comprising a regional shopping center, multi- family apartments, a mobile home park and rural residential properties. Proximity to employment centers, educational and recreational facilities, major arterials, and public transportation are all good. There were no adverse influences noted during physical inspection other than those discussed in this Site Description. 05- 534 -94 /City of Rohnert Park 1 27 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company ASSESSOR'S PARCEL MAP Assessor's Parcel Numbers 143 -381 -053 & -054 1C v4f 0 1 i C t i 1 gtim N is �ffi d� 4 � V 4 u o Q 9i ip R9AY Q�i S.n pe V ZC g. q y�g ® 8 p a a a m e M V s c' ag Subject d AB 05- 534 -94 1City of Rohnert Park 22 QC Imo$ � 9m 4� � -- _ �a: � Cm 1C v4f 0 1 i C t i 1 gtim N is �ffi d� 4 � V 4 u o Q 9i ip R9AY Q�i S.n pe V ZC g. q y�g ® 8 p a a a m e M V s c' ag Subject d AB 05- 534 -94 1City of Rohnert Park 22 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company CITY OF ROHNERT PARK ZONING MAP CITY OF ROHNERT PARK ZONING MAP i CG 4 MW 05-534-94ICity of Rohnert Park 23 S� q INTO f to Awl 02 { 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company PHOTOGRAPHS OF SUBJECT AND ENVIRONS VIEW SOUTHWEST FROM FOOD MARX DRIVEWAY / ROHNERT PARK EXPRESSWAY VIEW SOUTH FROM ROHNERT PARK EXPRESSWAY TO FOOD MAXX DRIVEWAY: SUBJECT TO RIGHT PHOTOS. RJC 05- 534 -94 1City of Rohnert Park 25 r 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company HIGHEST AND BEST USE Highest and best use is defined as follows: The reasonably probable and legal use of vacant land or an improved property that is physically possible, legally permissible, appropriately supported, financially feasible, and that results in the highest value.' The highest and best use of land or a site as though vacant is defined as follows: Among all reasonable, alternative uses, the use that yields the highest present land value after payments are made for labor, capital, and entrepreneurial c oordination.2 It is to be recognized that in cases where a site has an existing improvement, the highest and best use may very well be determined to be different from the existing use. The existing use will continue, however, unless and until land value in its highest and best use exceeds the total value of the property in its existing use. In analyzing highest and best use, the following questions for each possible use are considered: -Is the proposed use legally permissible? ►1s the proposed use physically possible? ,.Is the proposed use financially feasible? The above criteria are typically considered sequentially. The test of legal permissibility and physical possibility are applied first, and are interactive. Frequently there will be several possible uses that meet the. first three tests, atwhich point it is necessary to determine which use achieves maximum productivity. The highest and best is concluded after consideration of the four criteria and the elimination of alternative uses, as applicable. As Is with High Density Residential Zoning and GP Entitlements Determination of the highest and best use of the Subject site as though vacant considers the physical, legal, and economic factors that affect the specific parcel's range of possible uses. These factors include the site's location, physical characteristics, zoning and land use policies, as well as current and future market demand for various potential uses. Legally Permissible. Pursuant to the Agreement with the Client, the Subject is appraised under the hypothetical condition that the R -H zoning and High Density Residential general plan land use designation are in place. Permitted uses allowed as of right under the R -H zoning are detailed in the Site Description. Therefore, developmentof the Subject site consistentwith zoning and land use policies, and private CC &R's, as applicable, as demand warrants, is a legally permissible use. Other land use regulations applicable to the Subject are the inclusionary zoning requirement, which requires that each new development of 5 or more units designates 15% of its units as affordable to ' Appraisal Institute, The Appraisal of Real Estate, Chicago, Illinois (12th Edition, 2001) p.305. 2 !d. at 307. 05- 534 -94 /City of Rohnert Park 27 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company HIGHEST AND BEST USE As Is with High Density Residential Zoning and GP Entitlements households in the low to moderate income category (Chapter 17.07.020 (14), and the Density Bonus for Affordable Housing under Chapter 17.07.020 (8) as amended by Ordinance Number 749. Mandated by state law, density bonus incentives provide an additional density up to a maximum of thirty-five (35 %) over and above the maximum dwelling units allowed under the base density. Such density bonuses do not automatically trigger a general plan amendment or zoning change. Achievement of higher densities is considered as an entrepreneurial profit to the owner /developer that is very project-specific. Therefore development with a high density multi - family or for -sale development with a maximum base density of 30 du/a, is a legally permissible use of the Subject site. The maximum number of potential uses allowable is dependent upon the project - specific development plan. This appraisal assumes development of the Subject site under the base R -H zoning only. Physically Possible. The Subject comprises a generally level triangular site containing approximately ±1.873 acres of land in the aggregate with typical parking and building setback requirements, as well as private CC&R's that may affect building setbacks. The site exceeds the minimum lot size in the R -H District. Public utilities are available in the street. The site is located in the central west portion of the city at the edge of the UGB, in an established mixed -use neighborhood adjacent to a regional supping center with good proximity to U.S. Highway 101. Site configuration and adjacency to the Laguna may present some development challenges as compared with a typical rectangular parcel. However, no development plan was provided to the appraisers. There is adequate site area for compliance with setback and onsite parking requirements under the R -H zoning. Adequate ingress and egress forthe site is an extraordinary assumption of this appraisal. As discussed in the Site Description, environmental, archaeological and biotic resource studies were not available to the appraisers. Predicated on the extraordinary assumption that there exist no physical constraints to development, either latent or patent, development of the Subject site consistent with R -H zoning and general plan and other applicable land use policies and regulations, and private CC &R's, as applicable as demand warrants, is a physically possible use. Financially Feasible/Maximally Productive. The highest present value of the Subject site under the R -H zoning would be development of a legally permissible high density residential development, consistent with zoning and land use policies, particularly units affordable for low and very low income households. However, the rental restriction and/or income eligibility criteria for such affordable units may decrease the profitability of development to below construction and land costs. Higherdensiity market rate units utilizing density bonus increases and /or senior housing are also possible uses that could potentially be maximally productive. It has been a goal of a number of Sonoma County jurisdictions to increase the amount of land available for residential construction, inasmuch as residential development has been the primary driving factor in the local construction industry. Secondly, communities such as Rohnert Parts are committed to provide their fair share of residential units, as outlined in the Housing Element of the General Plan. Therefore, development of the Subject site consistent with zoning and land use policies, and private CC &R's, as applicable as demand warrants, is a physically possible use. Conclusion. An analysis of the physical, legal and economic factors influencing development of the Subject site indicates that development of legally permissible uses consistent with zoning and land use policies, and private CC &R's, as applicable, as demand warrants, is a financially feasible and maximally productive use of the site. This analysis assumes continuing availability of adequate financing. 05-534 -9410 y of Rohnert Park 26 705 Rohnert Park Expressway Rohnert Park CA 94928 the crockeccompany MARKET CONDITIONS The Subject's market area is considered to be Sonoma County, with the sub - market identified as the incorporated areas of the Cities of ROhnert Park/Cotati and environs. As of the Third Quarter 2005, commercial real estate activity in Sonoma County indicates steady improvement over 2005, driven by low interest rates. However, if interest rates continue to rise, sales activity is expected to be impacted. Large capital flows into real estate have significantly impacted competition for premium properties throughout the Bay Area, with office properties the most sought after. However, because there has been little jobs growth in the major economic base clusters, overall net absorption in both office and industrial space is limited. The retail sector has remained consistently stable. As the red hot housing market has begun to slow, vacancy in multi- family decreased sharply_, reported at 3.4% as of the end of Third Quarter. Conversion of alaartments. to residential condominiums and construction of new condominiums and townhomes is increasing, following both regional and national trend. The following is based in part on data published by commercial brokerages in Sonoma County as well as Bay Area Real Estate Information System, the California Association of Realtors and the California Construction Industry Research Board. Office Vacancy in the Sonoma County office sector increased in 2001 -2002 as new construction was completed and tenant demand decreased, particularlyfor large space users. The turnaround began in late 2003, as vacancy began to decrease. Overall, the office market in Sonoma County in 2004 showed steady improvement. Orion Partners' Second Quarter 2005 Office Report' ( "Orion ") reports a total office base countywide of approximately 7.98 million square feet, with overall vacancy at 20.1 %, comprising ±1.281 million square feet in direct vacancy and ±310,500 square feet available for sublease. Approximately 40% of the reported vacancy is in two properties in Rohnert Park and Petaluma. Office market rents remained overall stable in 2005. Net absorption in 2004 is reported at a negative ±180,000 square feet and a positive ±10,700 square feet is reported for Second Quarter 2005. Preliminary vacancy reports for Third Quarter 2005 reflect little change, with overall vacancy reported at 21.1 %. The Rohnert Park submarket office sector comprises 1.583 million square feet, or approximately 14% of the countywide market. Second Quarter 2005 vacancy is reported at 38.0% in direct vacancy, with another ±13,000 square feet available for sublease, for an overall vacancy of 38.8 %, as compared with an overall vacancy of 13.0% as of Second Quarter 2004. The dramatic increase is largely due to the addition of the 100 -acre fomner Agilent Technologies campus with approximately ±713,000 square feet of buildings on 76 acres. This high tech campus comprises a mix of office, R &D and warehouse space as opposed to pure office. Preliminary vacancy reports for Third Quarter 2005 reflect little change, with overall vacancy reported at 39.1 %. Retail Retail has historically been the strong sector of the Sonoma County commercial real estate market, and was particularly active in 2004 -2005. National tenants, from franchises to big box retailers, continue to compete for sites to expand into the North Bay. As a result, retail rents have been increasing and overall ' Orion Partners Report's total office base includes Class A and Class B buildings of 5,000 square feet or more. 05- 534 -94 /City of Rohnert Park 29 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.compony MARKET CONDITIONS capitalization rates decreasing. The retail sector has experienced stable vacancy rates with overall vacancy reported at less than 5% since First Quarter 2000. Keegan & Coppin Company reports on a countywide retail base of 16.653 million square feet. As of Second Quarter 2005, approximately ±1.7 million square feet under construction or planned, primarily in neighborhood or regional centers. The lowest Second Quarter 2005 vacancy rates reported are at the regional malls, with a reported vacancy of 1.1 %, which is slightly lower than the 1.4% reported for Second Quarter 2004. Overall vacancy for all types of retail is reported at 4.1 % as of Second Quarter 2005, a full percentage increase over the 3.1 % for Second Quarter 2004. Preliminary vacancy reports for Third Quarter 2005 reflect little change, with overall vacancy reported at 4.0 %. Countywide asking rental rates for newer retail product as reported by K &C as of the beginning of 2005 indicate increases from 20% to 60% over rents reported for 2002. In response; many local jurisdictions, eager for developer fees and sales tax dollars, are vying for retail development: approximately ±900,000 square feet has been approved in Petaluma; ±300,000 square feet in Rohnert Park/Cotati; ±550,000 square feet in Santa Rosa; and ±46,500 square feet in Windsor. The Rohnert Park/Cotati submarket retail sector, which comprises 3.158 million square feet, or approximately 19% of the countywide market, has 260,000 square feet of planned or new construction projects. Second Quarter 2005 vacancy is reported at 5.7 %, a slight increase as compared with the 4.5% reported for Second Quarter 2004. Preliminary vacancy reports for Third Quarter 2005 reflect no change. New Construction Sonoma County. Data published by the Construction Industry Research board (CIRB) indicate that 1,343 single family and 346 multi- family permits were issued in Sonoma County in 2004, reflecting a decrease of approximately 5% and an increase of approximately 164 %, respectively. The reported 2004 non- residential private new construction permit volume decreased approximately 19% from2003. Total single family permits issued as of Third Quarter2005 are 1156 and total multifamily permits issued forthe same period are 768. City of Rohnert Park. CIRB data indicate that no single family permits were issued in Rohnert Park in 2004, and only one in 2003. The reported 2004 non - residential private new construction permit volume decreased approximately 78% from 2003.Total multi - family permits issued in 2004 were 252 as compared with 207 in 2003. Total single family permits issued as of Third Quarter 2005 are 2 and total multi- family permits are 96. Residential Sales Activity Sonoma County. The median price for a single family dwelling in the Sonoma County resale market in 2004 is reported at $500,000, an increase of 18% on a year -over year comparison basis and more than a 33% increase over the past two years. Sales of existing homes in Sonoma County totalled 6,247 in 2004, reflecting a 3.9% increase on a year -over -year comparison basis, and 3.1 % higher than the previous sales record two years ago. The county's median re -sale price as of the end of Third Quarter 2005 is reported at $615,000, as compared with $710,000 for the Bay Area and $544,000 for the state. The median re -sale price for a condominium is reported at $366,000, reflecting an approximately 22% increase for the same time period. The total number of listings for single family homes and condominiums in Sonoma County represents an approximately 50% increase on a year -over -year comparison basis, and total sales volume increased approximately 41 %. 05- 534 -94 10ty of Rohnert Park 30 705 Rohnert Park Expressway Rohnert Park CA 94928 She crocker.company MARKET CONDITIONS City of Rohnert Park. The September 2005 median re -sale price for a single family residence in the City of Rohnert Park/Cotati/Penngrove sub - marketwas $584,500, as compared with $507,500 in September 2004, reflecting an increase of approximately 15% on a year -over -year comparison basis. Conclusion Based on published vacancy reports by the area's largest commercial brokerages, the outlook for the Sonoma County market is cautiously optimistic. The Bay Area remains one of the country's most desirable commercial markets. However, both local and national markets remain sensitive to long- term interest rate increases. Although the residential market has been slowing and supply increasing in the past quarter, the median sales price continues its upward trend. Real estate professionals project that rising interest rates are likely to cool -sales activity; resulting in a more balanced market. 05- 534 -94 /City of Rohnert Park 31 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company VALUATION METHODOLOGY The Cost, Sales Comparison and Income Approaches are the traditional approaches to value and each provides data from the market, the analysis of which results in a value indication for the Subject. After reconciliation'of the value indications, a final conclusion of value is made, based upon the appraisal premise(s) for the particular assignment. The Cost Approach is based upon the assumption that an informed purchaser would pay no more for a property than the cost of producing a substitute property with the same utility as the Subject. In the Cost Approach, value is estimated by calculation of the current replacement cost of the Subject improvements as of the appraisal date, followed by deduction of the estimated depreciation due to physical deterioration, functional and /or external obsolescence. The replacement cost is generally_ estimated on a per square foot. basis using a recognized. cost .reporting service, then updated by the appraiser to account for local conditions. The opinion of value for the site, as though vacant, developed utilizing the Sales Comparison Approach, is then added to the depreciated cost of the improvements as of the valuation date for the final value indication by this approach. The Sales Comparison Approach is based upon the assumption that an informed purchaser will pay no more for a property than the acquisition cost of an existing property with similar attributes. This approach requires a comparable analysis of the attributes of recent similar transactions with those of the Subject as of the valuation date. Dissimilarities between the Subject and the comparable sales require appropriate adjustments to the latter. These adjustments may pertain to time, age, location, construction, condition, size or external economic factors, and are based upon the actions of buyers and sellers in the marketplace. Adjustments of each-of the comparable sales and a weighting of each results in a value indication by this approach. Also analyzed within the Sales Comparison Approach is the relationship between the gross income and sales price. This ratio, the Gross Income Multiplier (G.1_M.), may be a reliable indicator of value for the Subject when properly extracted from the market. The Sales Comparison Approach often provides a highly supportable estimate of value for homogeneous properties. For larger and more complex properties, the required adjustments may be numerous and more difficult to quantify. The Income Approach converts the anticipated future benefits of property ownership into an estimate of present value. It is generally selected as the preferred technique for income- producing properties because it most closely reflects the investment rationale and strategies of typical buyers. To utilize the Income Approach, the appraiser projects the net income of the property, selects an appropriate capitalization rate based upon market derived data and then capitalizes the net income into value, applying an appropriate discounting procedure_ The value indications derived from each approach are correlated to arrive at a final opinion of market value. In the instant case, the Cost Approach is not used since the Subject site is appraised as though vacant with no improvements. Further, the Income Approach is not utilized since the Subject is not the type of property typically held for the production of rental income. Therefore, the opinion of market value is developed utilizing only the Sales Comparison Approach, which is the typical approach for the valuation of vacant land for development. 05- 534- 94/City of Rohnert Park 32 9 E A. t SECTIONIII. VALUATION p y E A. t SECTIONIII. VALUATION a� m p a� m 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH As previously discussed in the Site Description, the Subject comprises a vacant site appraised under the hypothetical condition that it is a single parcel zoned for High Density Residential with a gross site area of ±1.873 acres, based on the Record of Survey. As cities recognize the need for more innovative designs capable of supporting different but harmonious uses - including both residential and commercial, the number of residential units — either multi - family, for -sale, or live /work —is frequently tied to the specific development plan. The actual number of units achieved is a function of base density, density bonus requirements, and other project- specific criteria. Therefore, the price per square foot of gross land area is considered to be the most reliable basis for comparison. Additional density bonus and other concessions or incentives are attributable to entrepreneurial profit and not to the land per se. The Subject's assumed High Density Residential zoning and land use allows residential development at densities ranging from 12.1 to 30.0 dwelling units per gross acre. This designation permits a wide range of housing types, from single family attached to multi - family, and is intended for specific areas where higher densities may be appropriate. Comparable sales analyzed include those parcels with equivalent zoning /land use designations in their respective jurisdictions. The Sonoma County market, and particularly the Rohnert Park/Cotati and Santa Rosa submarkets, were researched for sales of comparable vacant land with similar land use potential. The sales considered in the final analysis all permit residential development as of right or as conditional uses. An individual transaction summary and Assessor's Parcel Map are provided for each of the comparable sales, followed by a Summary of Comparable Sales, a Comparable Site Sales Locational Map, and an opinion of value for the Subject site via the Sales Comparison Approach. 05- 534 -94 10ty of Rohnert Park 33 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH Property Type: Assessor's Parcel Number: Census tract/Map Code: Location/Address: Grantor: Grantee: O.R. Number: Recordation Date: Documentary Transfer Stamps Site Size: Sales Price/Terms: Sales Price PSF: Zoning/General Plan /Specific Plan: Topography /Shape: Frontage: Flood Hazard Area: Vacant land with approvals 143 -051 -070 and 143 -051 -024 1513.05/424-H7 State Farm Drive /Padre Parkway Rohnert Park, CA 94928 Rohnert Park City Center, L.P. Rohnert Park Development Company, LLC 2003 - 187693 • 1. $2,926.00 +2.91 acres gross) ±126,760 square feet $2,660,000 /Cash to seller /No special assessments repotted $20.98 (gross) Mixed Use /City Center Concept Plan Area Level rectangularly shaped site; minimal site vegetation ±546' of frontage on Padre Parkway, ±225' on State Farm The site is not located within a Flood Hazard Area. Utilities: All public utilities are available. Infrastructure: All city streets are complete. Access: Pedestrian and vehicular access via both State Farm Drive and Padre Parkway; freeway access at Highway 101 /Rohnert Park Expressway interchange ± 0.75 mile west Improvements: None Entitlements: TM approval for 76 -unit mixed -use development with live /work, residential and retail; approvals for office expired Sales History: This property was listed on BAREIS and expired several times since 1999. Confirmed By: Buyer /BAREIS /Public Records 05- 534 -94 /City of Rohnert Park 34 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH Assessor's Parcel Map: APNs 143 -051 -024 and -070 o ,a p ac tr �a om o (k F—) -01Zw a 24 �Ya ��0 /O/ �R AMN S'/I•� �t 05- 534 -94 /City of Rohnert Park 35 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH COMPARABLE LAND SALE NUMBER 2 Property Type: Vacant land with approvals Assessor's Parcel Number: 143 - 311 -056 Census tract/Map Code: 1513.08/424 -H3 Location /Address: 5210 Country Club Drive Rohnert Park, CA 94928 Grantor: Engel Exchange Trust Grantee: Aston Asset Management Group LLC et al O.R. Number: 2005 - 076140 Recordation Date: 6.01.05 1)?� cumentary Transfer Stamps: $929.50 Site Size: ±0.650 acres gross/ +28,314 square feet Sales Price/Terms: $845,000 /Cash to seller /No special assessments reported Sales Price PSF: $29.84 Zoning/General Plan /Specific Plan: C-N: Neighborhood Commercial /Commercial /None Topography /Shape: Level rectangular site; minimal site vegetation Frontage: Approximately ±100' of frontage on Country Club Drive; adjacent to Mountain Shadows Plaza; easement driveway Flood Hazard Area: The site is not located within a Flood Hazard Area. Utilities: All public utilities are available. Infrastructure: All city streets are complete_ Access: Pedestrian and vehicular access via Country Club Drive; freeway access via Highway 101/116 interchange ± 1.0 mile northeast Improvements: None Entitlements: Approvals for mixed -use 7 -unit live /work ( ±14,700 sf) and office (±2,100 sf); includes architectural/engineering fees Sales History: Listed on BAREIS for $895,000 as of 6/04 Confirmed By: Listing Agent/BAREIS /Public Records 05- 534 -94 /City of Rohnert Park 36 705 Rohnert Park Expressway Rohnert Park CA 94928 The crocker.company SALES COMPARISON APPROACH ARABLE LAND SALE NUMBER 2 Assessor's Parcel Map: APN 143- 311 -055 7P - -� , O f / C o = _ F r $s ,e p �'\, e —a 1 j z alx r4� ar M, :fg J t - y i ® N `I, 05-534 -94 /City of Rohnert Pork 37 705 Rohnert Park Expressway Rohnert Park CA 94928 the crockeccompany SALES COMPARISON APPROACH COMPARABLE LAND SALE NUMBER 3 Property Type: Vacant land Assessor's Parcel Number: 144 - 070 -028 Census Tract/Map Code: 1512.04/424 -F6 Address: Wilford Lane Cotati, CA 94931 Grantor: Kleiman Grantee: Johnson/O'Hanlon O.R. Number: 2005 - 159124 Recordation Date: 10.25.05 Documentary Transfer Stamps: $577.50 Site Size: ±0.42 acres/ ±18,295 square feet Sales Price/Terms: $525,000 /Cash to seller /No special assessments Sales Price PSF: $28.70 Zoning /General Plan /Specific Plan: NU: Neighborhood, Urban/General CommerciaVNone Topography /Shape: Level basically rectangular site; trees; adjacent to park Frontage: Approximately ±100' on Wilford Lane Flood Hazard Area: The site is not located within a Flood Hazard Area. Utilities: All public utilities available. Infrastructure: Off -site improvements complete. Access: Vehicular and pedestrian access via Wilford Lane; freeway access at Highway 101/116 interchange 1/4 mile southwest Improvements: None Entitlements: None Sales History: This parcel was listed for $499,000 on BAREIS as of 8111/05; price bid up approximately 55 over offering price. Confirmed By: Listing Agent/BAREIS /Buyer /Public Records 05- 534 -94 10ty of Pohnert Park 38 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH 0 v 4� e �oo m � F-A Assessor's Parcel Map: APN 144- 070 -028 O• W � Q h Q a G l� \ 6 U f.. k ma 2� 8n 4 Q. s F 1 va 2 1 I 1 pN O• W � Q h Q a G l� \ 6 U f.. k ma 2� 8n 4 05- 534 -94 /City of Rohnert Park 39 Q.D REDnV0D HWY s 05- 534 -94 /City of Rohnert Park 39 705 Rohnert Park Expressway Rohnert Park CA 94928 Fhe crocker.company Y SALES COMPARISON APPROACH COMPARABLE LAND SALE NUMBER 4 Property Type: Vacant land Assessor's Parcel Numbers: 041- 161- 006-011 and -015 Census Tract/Map Code: Address: Grantor: Grantee: O.R. Number: Recordation Date: F)ecumentary Transfer Stamps: Site Size: Sale_- Price/Terms: Sales Price PSF: ZoninglGeneral Plan /Specific Plan: 1530.01/424 -F6 1627 Cleveland Avenue Santa Rosa CA 95401 Akey/Walter Heritage Community Housing, Inc- 2005-057218/057219 4.27.05 Na ±2.18 acres/ ±95,157 square feet $2,500,000 /Cash to sellers/No special assessments $26.27 CG: General Commercial /Retail and Business Services Topography /Shape: Level somewhat rectangular site; minimal site vegetation Frontage: Approximately ±375' on Cleveland /±285' on Jennings Avenue Flood Hazard Area: The site is not located within a Flood Hazard Area. Utilities: All public utilities available. Infrastructure: Off -site improvements complete. Access: Vehicular and pedestrian access via Jennings and Cleveland Avenues; freeway access at Highway 101/W. Steele Lane interchange ±0.5 mile northeast and 101/W. College Ave.interchange ±0.75 miles southeast Improvements: Older industrial building and cottages to be demolished prior to development; no contributory value assigned Entitlements: None; COE subject to prelim approval secured by purchaser Sales History: This parcel was reportedly not listed prior to sale. Confirmed By: Listing Agent/BAREIS Public Records 05534 -94 /City of Rohnert Park Mr 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.compan 0 SALES COMPARISON APPROACH Assessor's Parcel Map: APN 041- 161 - 006 -011 and -015 b u � SrArE NIOHWAY !01 P _ CLEVELAND AVE r � Z Sale 4 It ', d O T uet ? y 3 "2 i 3 i v1 OqO t\p m ^ws-A Q �s O ° • ^i ri s rp �:SFrs ' °f` °y �,� � s° a° • � � \ � f 05- 534 -94 /City of Rohnert Pork 41 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH Comparable Sales Locational Map 05- 534 -94 /City of Rohnert Park 42 a' FlQt ��� ��i�.'1iJiis_�'�►in ••�'� ¢,4iPfL?_�_�_i.�jr". M►�.`7 -3 A!' 'aV,��,y �• `'� L��� i� �� tea! � uT _. � Cam- �..�► ;• -� Qy' rg SUBJECT ROM WE 1 _ © aRMF 05- 534 -94 /City of Rohnert Park 42 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.compamy SALES COMPARISON APPROACH Summary of Sates and Adjustments 05- 534- 94 104, of Rohnert Park 43 Subject Sale No. 1 Sale No. 2 Sale No. 3 Sale No.4 Address 705 Rohnert Park Expy Rohnert Park State Farm/ Padre Pkwy Rohnert Park 5210 Country Club Drive Rohnert Park Wilford Lane Cotati 1627 Cleve- land Avenue Santa Rosa APN 143 -391- 053/054 143- 051 -024 143- 051 -070 143 -311 -056 144 -070 -028 041 -161 -006, 011 and 015 Location nw Rohnert Park nw Rohnert Park ne RP ne Cotati nw SR Site Size ±1.873 acres +2.91 acres ±0.65 acre ± 0.42 acres ±2.18 acres Shape Triangular Rectangular Rectangular Rectangular Rectangular Zoning R -H Mixed Use C -N N -U C -G General Plan/ Specific Plan R -H Mixed Use/ City Center Commercial General Commercial Retail & Bus. Services Entitlements None TM Approvals Use Permit None None Date of Sale Value: 11.01.05 9.05.03 6.01.05 10.25.05 4.27.05 Sales Price $2,660,000 $845,000 $525,000 $2,500,000 Sales Price PSF $20.98 $29.84. $28.70 $26.27 Time Adjustments 25% 5% 0% 6% Adjusted SP PSF $26.22 $31.33 $28.70 $27.85 Other Location Similar Inferior Similar Superior Size Larger Smaller Smaller Similar Shape /Utility Superior Superior Superior Superior Creek Similar Inferior Inferior Inferior Zoning /GP Similar Superior Similar Superior Entitlements Superior Superior Similar Similar Total Adjustments -30% -40% -20% -25% Indicated Value PSF $18.35 $18.80 $22.96 $20.89 05- 534- 94 104, of Rohnert Park 43 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH Analysis and Conclusions The preceding Summary of Comparable Sales indicates unadjusted sales prices with a range of $20.98 to $29.84 per square foot of gross land area. Due to the fact that there is limited recent reliable sales data for similarly zoned sites in the City of Rohnert Park, the appraisers analyzed the competitive market for sales of sites in other competitive Sonoma County submarkets that could be developed consistent with the Subject's R -H zoning. Although buyer motivations in the purchase of vacant land are varied, the appraisers have made an effort to include in this analysis those parcels or assemblage of parcels that would represent reasonable available alternatives to a potential purchaser of the Subject. The following discussion details the adjustment process analysis. The adjustments are based on the appraisers' opinions and familiarity with the submarket areas. Date of Sale: The comparable sales transactions selected in this analysis closed escrow between September2003 and June 2005, which represents an approximately 25 -month time period between the oldest sale date and the valuation date. Although the Sonoma County residential market was expected to cool somewhat in 2005, it has remained active through Third Quarter 2005. The 2003 sale is included due to its similarity with the Subject and the overall reliability of the time adjustment: An analysis of several reliable although not identical matched pair raw land sales indicates an appreciation factor of approximately 1 % per month overall in the Sonoma County market. A conservative annual average appreciation factor of 12% per year for the land only is considered reasonable and supportable_ After the required time adjustments to the comparable sales, the adjusted sales price per square foot ranges from $26.22 to $31.33. Further adjustments to the comparable sales are made for location, shape /utility, creekside amenity, zoning and entitlements, as follows: Location: The Subject is located in west central Rohnert Park in a transitional mixed -use neighborhood that includes retail, residential and commercial uses. Located at the western edge of the UGB, the site is suitable for high density residential development. Sale Number 1 is located in the Rohnert Park City Center, a 32 -acre mixed use development that includes civic buildings, office and multi - family uses surrounded by professional and medical office, commercial banks and retail shopping centers. Freeway proximity is good. This zoning also supports high density residential development, similar to the Subject. Therefore no locational adjustment is required. Sale Number 2 is located in a mixed -use neighborhood in the northeast quadrant of Rohnert Park. Although adjacent to a neighborhood center, this parcel is judged overall inferior to the Subject in terms of proximity to services. Therefore an upward adjustment is required. Sale Number 3 is located in the northeast quadrant of the City of Cotati, in a mixed -use neighborhood that is primarily commercial/residential. Freeway proximity is excellent. Overall, this location is judged similar to that of the Subject, with no locational adjustment required. Sale Number 4 is located in a mixed -use transitional neighborhood in northwest Santa Rosa, proximate to the Coddingtown regional center and has good freeway access. The Santa Rosa market typically commands a higher end product price for multi - family residential. This location is judged overall superior to the Subject. Therefore a downward adjustment is required. 05- 534 -94 /City of Rohnert Park 44 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.compa, SALES COMPARISON APPROACH Analysis and Conclusions Site Size: The Subject's site size is approximately ±1.873 acres, based on the hypothetical assumptions stated herein. Typically, the sales price per square foot is inversely proportional to the parcel size; however, size regression is tempered by the lack of quantifiable sales data that isolates size only, and the fact that, for development purposes, a smaller site may provide greater development challenges in terms of points of access, internal circulation, and parking — particularly for residential development. Offsetting this potential limiting factor is the larger pool of investors available for smaller sites and likelihood of a reduced development timeline. Sale Number 1 requires an upward adjustment for its larger parcel size. Sales Number 2 and 3 are adjusted downward for their smaller parcel sizes. Sale Number 4 is similar in size, with no adjustment required. Shape /Utility: The site's topography is generally level, with no hydrological or geotechnical constraints to development known to the appraisers. The triangular site configuration is typically considered more difficult from a development standpoint, the setbacks may be greater due to creek adjacency and building setbacks to buffer the adverse impacts of the adjacent shopping center. All of the sales are basically rectangular sites with no known development constraints; therefore downward adjustments are required. Creek: The Subject borders the Laguna de Santa Rosa Channel on the southerly boundary. This is considered a positive attribute for residential development_ Sale Number 1 enjoys similar creek proximity; therefore no adjustment is required. Sales Number 2, 3, and 4 each requires an upward adjustment. Zoning /General Plan Designation: The Subject is appraised under its highest and best use as land available for development under the City of Rohnert Park High Density Residential zoning and General Plan land use policies. Permitted uses as of rightwithin the High Density Residential zoning include multi - family dwellings with base densities of 12.01 to 30.0 dwelling units per acre, small day care homes, small family care /community care homes, small homeless shelters, small recovery facilities, small residential care facilities, and public facilities subject to PC review. Sale Number 1 has a Mixed Use zoning wherein the maximum density limitation is determined by minimum unit size requirements. This parcel was purchased for a mixed -use high density residential development that is primarily residential. Overall, this zoning is considered similar to the Subject, with no adjustment required. Sale Number 2, is zoned C -N: Neighborhood Commercial which does allow LiveA/Vork residential units. Overall, this zoning district allows a wide range of retail and office uses and service establishments, but was purchased with permits in place. This zoning is considered overall superior to the subject; therefore a downward adjustment is required. Sale Number 3 is zoned Neighborhood -Urban by the City of Cotati, with a General Commercial general plan that allows a maximum base density of 15 du /a. Although the allowable maximum residential density is lower than that of the subject, the zoning also allows neighborhood serving commercial uses. As a result, this zoning is considered overall similar to the subject. Therefore no further adjustment is required. Sale Number 4 is zoned CG- General Commercial, which re- zoning became effective while the property was in escrow. The CG zoning district allows residential uses as part of mixed -use projects 05- 534 -94 /City of Rohnert Park 45 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company SALES COMPARISON APPROACH Analysis and Conclusions as well as independent residential developments with a maximum density of 30 dwelling units per acre. This site was purchased for high density residential development. This zoning is considered overall superior to that of the Subject; therefore a downward adjustment is required. Improvements: As stated, as of the effective date of valuation, the Subject is appraised as if vacant and ready for development. Comparable Sales Number 1 through 3 are unimproved, with no adjustment required. Sale Number 4 was improved at the time of sale with an older industrial building and older cottages. According to the buyer's agent, there was no contributory value assigned to the improvements, and the sale represented land value only. Therefore no further adjustment is required. Entitlements: The Subject is appraised as vacant land with R -H zoning and High Density Residential general plan land use designation in place. Sale Number 1 had tentative map approval for a 76 -unit mixed -use development comprising towhhomes, live/work and condominium units as well as a small retail element at the time of sale. Permits and plans were included in the sales price. A downward adjustment is calculated based on information provided by the parties. Sale Number 2 had an approved use permit for a 7 unit live /work and retail development at the time of sale. Architectural and engineering plans were included in the sales price. A downward adjustment is calculated based on information provided by the parties. Sale Number 3 had no approvals at the time of sale. Reportedly, the site did receive approvals for a residential PUD in 1993; however, those approvals subsequently expired. Therefore no further adjustment is required. Sale Number 4 had no approvals at the time of sale. The buyer had discussed preliminary design concepts with the City of Santa Rosa as well as potential financing for the subsidized multi - family residential units proposed on the site. However, all work and expenses were bome by the buyer. Therefore, no adjustment is required. Conclusion After adjustment to the comparable sales for measurable dissimilarities with the Subject, the indicated range of value for the Subject is from $18.35 to $22.96 per square foot of gross land area. Based on the preceding analysis, each of the sales is considered to be a relevant indicator of value for the Subject. Each represents a reasonable alternative urban development site in the Subject or similar sub - markets. Placing similar weight on each of the transactions, $20.00 per square foot of land area is selected as a reasonable indicator of value for the Subject, assuming the site is capable of development, at a minimum, under the base density allowable under the City of Rohnert Park High Density Residential zoning and land use polices, without consideration of any potential density bonus increases, incentives or concessions that may be applicable to a project - specific development. 05- 534 -94 /City of Rohnert Park 46 M5 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company OPINION OF MARKET VALUE Based on the preceding analysis, the concluded opinion of the market value of the Subject, via the Sales Comparison Approach, is calculated as follows: 81,587 square feet $20.00 psf $1,631,740 Rounded To $1,630,000 The concluded opinion of market value of the Subject, via the Sales Comparison Approach, as of the valuation date of November 1, 2005, and subject to the Statement ofAssumptions and Limiting Conditions and conditions of value stated in the Property Summary and Conclusion of Value, is: ONE- MILLION SIX HUNDRED THIRTY THOUSAND DOLLARS ($1,630,000) 05- 534 -94 /City of Rohnert Park 47 705 Rohnert Park Expressway Rohnert Park CA 94928 the crocker.company MARKETING /EXPOSURE TIME "Marketing period" is a prospective period commencing with the date of valuation; that is, the period required to sell a property interest at the opinion of market value during the period immediately after the effective date of the appraisal. Implicit in the definition of reasonable marketing time are the following considerations: The property will be actively exposed and aggressively marketed to potential purchasers through marketing channels commonly used by the sellers of similar types of properties. The property will be offered at a price reflecting an appropriate markup over market value; i.e., that typically used by sellers for similar types of properties. A sale will be consummated under the terms and conditions of market value defined by the Uniform Standards of Professional Appraisal Practice (USPAP). "Exposure time" is a retrospective period associated with the hypothetical transaction as of a valuation date and is presumed to preclude the effective date of the appraisal, which in the instant case is November 1, 2005- Based on the market conditions preceding the effective date of November 1, 2005, as previously discussed, and the exposure time of the comparable sales analyzed, less than one year is considered to be a reasonable exposure period. Based upon the limited supply of similar well located infill parcels within the Subject's submarket area and the projected continuing demand for infill residential/mixed -use projects, it is anticipated that the required marketing time prior to consummation of a sale for the Subject as of the valuation date of November 1, 2005 would be less than one year. 05- 534 -94 10ty of Rohnert Park 48 a s 0 APPENDICES Qualifications /Licenses to Agreement for Services Y ` t k f 6 RE -SUMES C 4 � s d 1, 4 Qualifications -B Licensure 0 RONALD J CROCKER MA! SRA LINDA DARNELL CROCKER Jd o PROFESSIONAL QUALIFICATIONS Ronald Jay Crocker MAI, SRA I'���Stdt�AL �[cGt3C3llNFzt ,ANp �xPfYFttEi�cE the crocker_company 1996 present. Ronald Crocker is a co- founder of the crocker.company, a real property valuation and consulting firm located in Santa Rosa, California. He has over thirty years of experience in the valuation and appraisal review of real property of all types, including but not limited to, the following: • agricultural and unimproved land, including vineyards • airport facilities and leaseholds • assessment districts • churches and houses of worship ■ condominium, PUD and residential subdivisions ■ conservation and open space easements ■ entertainment and lodging facilities ■ golf courses ■ hospitals and health care facilities, including senior residential care facilities ■ industrial and manufacturing facilities ■ mixed use developments ■ mobile home parks a m. vie theatres (multi- screenlmulti -use facilities) ■ multi- family residential ■ professional office buildings and medical office buildings and condominiums ■ retail facilities of all types, including neighborhood and regional shopping centers right of way acquisitions special purpose and limited use properties, including public and institutional facilities ■ site selection studies and market rental surveys Crocker Hornsby 1982 -1995. Co- founder and a principal of Crocker Hornsby, a commercial real property valuation firm in Santa Rosa, California. Appraisal assignments included the valuation of fee simple, leased fee and leasehold interests in real, property of all types; ground leases and easements; and partial takings for right of way acquisitions. CrockerAppraisals 1978 -1982. Founder and principal of Crocker Appraisals, a real property valuation firm in Santa Rosa, California. Appraisal assignments included single and multi - family residential units, commercial and industrial properties, special use properties and vacant land. Imperial Savings and Loan, Santa Rosa, CA 1975 -1978. Senior Appraiser • An Introduction to Appraising Real Property ■ Single Family Residential Appraisal • Capitalization Theory and Techniques Parts I and 11 ■ Urban Properties • Standards of Professional Practice and Conduct ■ Investment Analysis • Valuation Analysis and Report Writing ■ Litigation Valuation PROFESSIONAL QUALIFICATIONS (cormNum) Ronald Jay Crocker MAI, SRA Mr. Crocker completed the following credits in real estate appraisal education from 1996 -2005. • Eminent Domain Appraising in CA • Vineyard Valuation • Federal & State Laws & Regulations • USPAP • Appraising More Than Land & Buildings • Anatomy of the Deal • The Institutionalization of Real Estate • Affordable Housing • Condemnation Appraising • Standards of Professional Practice • Apartment and Retail Update • Valuation of Detrimental Conditions In Real Estate • Contaminated Properties • REITS_ Securitizing the Real Estate Market • Life Companies/Wall Street Conduits • Office & Industrial Market Update ■ Public Interest Value • Defending the Appraisal in Litigation • Lease Abstraction Analysis • USPAP Update • Separating Real and Personal Property From Intangible Business Assets • Uniform Standards for Federal Land Acquisitions • Standards of Professional Practice. C • National USPAP Update Appraisal Institute Seminar 9.96 Appraisal Institute Seminar 9.96 Appraisal Institute Fall Conference 9.96 Appraisal Institute Fell Conference 9.96 International Right of Way Association 9.96 Appraisal Institute Fall Conference 10.96 Appraisal Institute F4I Conference 10.96 Appraisal Institute Seminar 7.97 International Right of Way Association 9.97 Appraisal Institute Course 9.97 Appraisal Institute Fall Conference 10.97 Appraisal Institute Seminar 2.98 International Right of Way Association 9.98 Appraisal Institute Fall Conference 10.98 Appraisal Institute Fell Conference 10.98 Appraisal Institute Fail Conference 10.98 Appraisal Institute Seminar 4.99 Appraisal Institute Seminar 4.99 Appraisal Institute Seminar 10.99 Appraisal Institute Seminar. 6.00 Appraisal Institute. Seminar 9.02 Appraisal Institute Seminar 10.02 Appraisal Institute Course 12.02 Appraisal Institute Course 9.04 INSTE2UCTOE2 { From 1978 -1982, Ronald Crocker was an instructor for the course entitled "The Principles of Real Estate Appraisal" at the Santa Rosa Junior College in Santa Rosa, California. I�?CPERj W11'NIrSS '� Mr. Crocker is qualified as a real property valuation expert witness in the Municipal and Superior Courts of Sonoma County and the United States Bankruptcy Court in Santa Rosa, MAI, SRA Designations: Mr. Crocker holds the MAI and SRA designations awarded by the Appraisal Institute and is currently certified under the continuing education program for members. Offices Held: Mr_ Crocker served as Director and President of the former East Bay Chapter of the Society of Real Estate Appraisers, which subsequently merged with the Appraisal Institute_ He is also a Past President of the Real Estate Appraisers of Sonoma County. Cert;rcation: Mr. Crocker has been a licensed Certified General Real Estate Appraiser in the State of California since 1992 (License #AG008219, expiration 12.08.06) and has currently completed the continuing education requirements of the Office of Real Estate Appraisers. tateprsr" Th � c n h,a� �d : is Irce sea ...._a genera( real estate ap �-� r h it tle ! tc Sb the to le "��Mi Te .1 ne a eel _ _ -r �s rs i �rsing an .. _ -t catjo vu _.. - -- _ - - - _- ..:. k .. .. — .. ._ _ _ _ _.. _..... .. ._... ..... .. 1kviii �' — -_ - in r .c Date lfee Deeernber 8� iLn LINDA DARNELL CROCKER, JD PROFESSIONAL QUALIFICATIONS P)4617 S1O BACKGROUND *j the crocker.company 1996 present: Linda Crocker is a co- founder of the crocker.corrtpany, a real property valuation and consulting firm located in Santa Rosa, California. She has eighteen years of experience in valuation and consulting, including the following types of properties: ■ affordable housing developments, including single family, PUD, multi - family, and senior ■ airport facilities and leaseholds ■ agricultural and unimproved land ■ assessment districts ■ churches and houses of worship ■ condominium, PUD, and single family subdivisions ■ entertainment and lodging facilities ■ health care facilities ■ mixed -use developments ■ multi- family residential - ■ open space and conservation easements ■ professional office and medical office buildings, including condominiums ■ retail facilities ■ right of way acquisitions ■ senior housing, including assisted care and residential care facilities ■ special purpose and limited use properties, including public and institutional facilities ■ market rental studies and site selection studies ■ feasibility studies, market and marketability studies Crocker Hornsby 1984 -1995: Prior to co- founding the crocker.company, Ms. Crocker was an appraiser /analyst with Crocker Hornsby, a commercial real property valuation firm in Sonoma County, California. Appraisal assignments included the valuation of fee simple, leased fee and leasehold interests; easements, including conservation easements; rights of way acquisitions; and highest and best use studies, feasibility studies, and market and marketability studies. EDUCATION.;: Juris Doctor, Empire College of Law, Santa Rosa, California, 1981 Bachelor of Arts, Cum Laude, University of,Minnesota, 1972 Ms. Crocker completed a variety of industry related courses and seminars in support of her license. Specific Appraisal Institute real property valuation courses include the following: • Basic Valuation Procedures • capitalization Theory and Techniques • Market and Marketability Analysis • Real Estate Appraisal Principles • Standards of Professional Practice Additional Appraisal Institute seminars have included both traditional and specialized topics: • Affordable Housing • Business Valuation • Condemnation Appraising • Conservation/Preservation Easements • Depreciation Analysis • Easement Valuation • Eminent Domain • Federal Income Tax and Real Estate • Federal Rules and Regulations • Highest and Best Use • Measuring Economic Obsolescence • Pubric Interest Value • Risk Analysis • Subdivision Analysis • Uniform Standards of Professional Practice • Vineyard Valuation LINDA DARNELL CROCKER, JD PROFESSIONAL QUALIFICATIONS (CONTINUED) PROF�SSiOiVAL AFFILIAT1013S: , . Association Memberships ■ California Bar Association ■ Sonoma County Bar Association ■ Urban Land Institute Ms. Crocker served as an officer and member of the Board of Directors of the East Ray Chapter of the Society of Real Estate Appraisers, currently the Appraisal institute; former editor of Focus newsletter Certification: Ms. Crocker has been a licensed Certified General Real Estate Appraiser in Califomia since 1992 (License #AG008075, expiration 1.14.07) and has completed the continuing education requirements for the Office of Real Estate Appraisers. CON1'INUIN� €DUCAT.�O,N COURSES Since 1996, Ms. Crocker's continuing education includes course in real estate appraisal, ethics and law, including training in mediation and conflict resolution. Specific real estate seminar topics are presented below. • Eminent Domain Appraising in CA Appraisal Institute Seminar 9.96 • Vineyard Valuation Appraisal Institute Seminar 9.96 • Appraising More Than Land & Buildings IRWA Fall Conference 9.96 • Appraising and the Internet Appraisal Institute Fall Conference 10.96 • Housing Trends Appraisal Institute Fall Conference 10.96 • Reviewing Commercial Appraisals Appraisal Institute Workshop 7.97 • Affordable Housing Appraisal institute Seminar 7.97 • Condemnation Appraising IRWA Seminar 9.97 • Office & Industrial Markets Update Appraisal Institute Fall Conference 1097 • Conversion Challenges Appraisal Institute Fall Conference 10.97 • Takings Continuing Education of the Bar 11.97 • Contaminated Properties IRWA Fall Conference 9.98 • Litigation Cross Examination Appraisal Institute Fall Conference 10.98 • Partial Interest Valuation Appraisal Institute Fall Conference 10.98 • Appraiser Legal Liability Appraisal Institute Fall Conference 10.98 • Public Interest Value Appraisal Institute Seminar 4.99 • Defending the Appraisal in Litigation Appraisal Institute Seminar 4.99 • Commercial Leases Continuing Education of the Bar 5.99 ■ Lease Abstraction Analysis Appraisal Institute Seminar 10.99 ■ USPAP Update Appraisal Institute Seminar 6.00 ■ Separating Real and Personal Property Appraisal Institute Seminar 9.02 From Intangible Business Assets ■ Uniform Standards for Federal Land Appraisal Institute Seminar 10.02 Acquisitions ■ Recent Developments in Coastal Jurisprudence Continuing Education of the Bar 10.03 ■ Contaminated Site Cleanup/Redevelopment Continuing Education of the Bar 10.03 ■ Multi-Party Water Resource Disputes Continuing Education of the Bar 10.03 ■ The Ebb and Flow of Wetlands Law Continuing Education on of the Bar 10.03 - ■ Conservation Easements Continuing Education of the Bar 10.03 ■ National USPAP Update Appraisal Institute Course 9.04 ■ Appraisal Practice McKissock 11.04 ■ Appraiser Liability McKissock 11.04 ■ Information Technology McKissock 11.04 s AGREEMENT FOR SERVICE S A ' r AGREEMENT FOR SERVICES This Agreement is made and entered into this 11th day of October, 2005, by and between the Community Development Commission of the City of Rohnert Park, hereinafter referred to as the ".Commission," and The Crocker Company, hereinafter referred to as the "Consultant." WHEREAS, the Commission desires to obtain an independent appraisal of the City owned property at 705 Rohnert Park Expressway West (Assessor Parcel Numbers: 143- 391 -53 & 143- 391 -54); and . WHEREAS, the Commission sent out a request for proposals and qualifications and received a qualified response from the Consultant; and WHEREAS, the Consultant is qualified and experienced and has demonstrated the ability to perform appraisals in an accurate and timely manner. NOW, THEREFORE, said Conunission and said. Consultant for the considerations hereinafter set forth, mutually agree as follows: 1. SCOPE OF WORK_ Consultant shall perform those services described as the Scope of Services in the Response to RFQ/RFP for Appraisal Services attached as Exhibit "A" within the time frames stated therein. 2_ COORDINATION_ Consultant shall assign Linda Darnell Crocker, Principal, to personally participate in said project and to coordinate the activities of the Consultant. 3. COMPENSATION_ A. Commission shall pay Consultant as compensation in full for such services and expenses at the rate set forth under Fee for Initial Report in the Response to RFQ/RFP for Appraisal Services attached as Exhibit "A" to the respective approved proposal, with the total sum not to exceed $4,500.00. Progress payments will be tied to completion of tasks so all payments are proportional to the work completed_ B. Consultant shall submit an invoice for work performed. Commission shall make any payment due within thirty (30) days after approval of the invoice by Commission. C. Payments due and payable to Consultant for current services are within the current budget and within an available, unexhausted and unencumbered appropriation of the Commission. In the event the Commission has not appropriated sufficient funds for payment of Consultant services beyond the current fiscal year, this Agreement shall cover only those costs incurred up to. the conclusion of the current fiscal year; payment for additional work is conditional upon future Commission appropriation. 4. TERM- The term of this Agreement shall be from the date of its execution until the completion of the work contemplated by this Agreement and its final acceptance by Commission unless terminated earlier as provided herein. 5. NOTICES. All notices, bills, and payments shall be made in writing and may be given by personal delivery or by mail. Notices, bills and payments sent by mail should be addressed as follows: TO COMMISSION: HOUSING & REDEVELOPMENT CITY OF ROHNERT PARK 6750 COMMERCE BOULEVARD ROHNERT PARK, CA 94928 -2486 ATTN: CAS ELLENA TO CONSUFFANT: THE CROCKER COMPANY 4171 OLD VINEYARD LANE SANTA ROSA, CALIFORNIA 95404 ATTN: LINDA DARNELL CROCKER and when so addressed, shall be deemed given upon deposit in the United States mail, postage prepaid. In all other instances, notices, bills and payments shall be deemed given at the time of actual delivery. Changes may be made in the names and addresses of the person to whom notices, bills and payments are to be given by giving notice pursuant to this Paragraph. 6. AMENDMENT OF SCOPE OF WORK. Commission shall have the right to amend the Scope of Work of any approved proposal within the Agreement by written notification to the Consultant. In such event, the compensation and time of performance shall be subject to renegotiation upon written demand of either party to the Agreement. Failure of the Consultant to secure Commission's written authorization for extra or changed work shall constitute a waiver of any and all right to adjustment in the contract price or time due, whether by way of compensation, restitution, quantum meruit, etc. for work done without the appropriate Commission authorization. 7. COMMISSION'S RIGHT TO TERMINATE /SUSPEND CONTRACT. At any time and for any or no reason, Commission shall have the right to terminate this Agreement, take possession of the Consultant's work, e.g., studies, preliminary drawings, computations, specifications, etc., insofar as they are complete and acceptable to the City, and pay the Consultant such equitable proportion of the total remuneration as the work satisfactorily done by the Consultant at the time of such discontinuance bears to the whole of the work required to be done by the Consultant under the terms of this Agreement. 8. CORRECTION OF WORK. The performance of services or acceptance of information furnished by Consultant shall not relieve the Consultant from obligation to correct any defective, inaccurate or incomplete work subsequently discovered and all such work shall be remedied by the Consultant on demand without cost to the Commission. 9. DELAYS AND EXTENSIONS. The Consultant will be granted time extensions for delays beyond the Consultant's control. Time extensions will be equal to the length of the delay or as otherwise agreed upon between the Consultant and the Commission. In such event, compensation as set forth in the Scope of Work shall be subject to renegotiation upon written demand of either party to the Agreement. 10. RECORDS OF PERFORMANCE. Consultant shall maintain adequate records of contract performance costs, expenses, etc., and make these records available for inspection, audit, and copying by the Commission during the agreement period and for a period of three (3) years from the date of final payment. IL SUBCONTRACTING. None of the services covered by this contract shall be subcontracted without the prior written consent of the Commission. In accordance with Government Code Section 7550, Consultant agrees to state in a separate section of any filed report the numbers and dollars amounts of all contracts and subcontracts relating to preparation of the report. 12. ASSIGNMENT. The Agreement shall not be assigned by the Consultant in whole or in part, without the written consent of the Commission. 13. INDEMNIFICATION. To the full extent permitted by law, Consultant shall indemnify, hold harmless, release and defend the City of Rohnert Park, the Commission, their officers, employees and agents from and against any and all actions, claims, demands, damages, disability, losses, expenses including attorney's fees and other defense costs and liabilities of any nature that may be asserted by any person or entity including Consultant, arising out of Consultant's negligent performance of services hereunder, including the activities of other persons employed or utilized by Consultant in the performance of this Agreement (including design defects and regardless of Commission's approval, use or acceptance of the work or work product hereunder) excepting liabilities due to the negligence or willful misconduct of City or Commission. This indemnification obligation is not limited in any way by any limitation on the amount or type of damages or compensation payable by or for Consultant under Worker's Compensation, disability or other employee benefit acts or the terms, applicability or limitations of any insurance held or provided by Consultant and shall continue to bind the parties after termination/completion of this Agreement. 14. INSURANCE. Without limiting Consultant's indemnification provided herein, Consultant shall take out and maintain, throughout the period of this Agreement, the following policies of insurance placed with insurers with a current A.M. Bests rating of no less than ANII or its equivalent against injury/death to persons or damage to property which may arise from or in connection with the activities hereunder of Consultant, its agents, employees or subcontractors: A. Comprehensive or Commercial General Liability Insurance at least as broad as Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001), in an amount of $1,000,000.00 per occurrence. If work involves explosive, underground or collapse risks, XCU must be included. If a general aggregate limit is used, either the general aggregate limit shall apply separately to this project or the general aggregate shall be twice the required occurrence limit. Said policy shall contain, or be endorsed with, the following provisions: (1) The City and the Commission, their officers, employees and agents, are covered as insureds for liability arising out of the operations performed by or on behalf of Consultant. The coverage shall contain no special limitations on the scope of protection afforded to the City and Commission, their officers, agents and employees. (2) The policy shall not be canceled or materially reduced in coverage without thirty (30) days prior written notice (10 days for non - payment of premium) to Commission by certified mail. (3) The inclusion of more than one insured shall not operate to impair the rights of one insured against another insured, and the coverage afforded shall apply as though separate policies had been issued to each insured, but the inclusion of more than one insured shall not operate to increase the limits of the insurer's liability. (4) For claims related to this project, the Consultant's insurance is primary coverage to the City and /or Commission, and any insurance or self- insurance programs maintained by the City and /or Commission is excess to Consultant's insurance and will not be called upon to contribute with it. (5) Any failure to comply with reporting or other provisions of the parties, including breach of warranties, shall not affect coverage provided to the City and Commission, their officers, employees and agents_ B. Automobile liability insurance with coverage at least as broad as ISO Form numbers CA 0001 06 92, Code I (any auto), for vehicles used in the performance of this Agreement with minimum coverage of not less than $1,000,000 per accident combined single limit (CSL). Such policy shall contain or be endorsed with the provision that coverage shall not be canceled or materially reduced in coverage without thirty (30) days prior written notice (10 days for non - payment of premium) to Commission by certified mail. C. Worker's Compensation insurance meeting statutory limits of Labor Code which policy shall contain or be endorsed to contain a waiver of subrogation against City, its officers, agents, and employees and provide for thirty (30) days prior written notice to City in the event of cancellation. If Consultant has no employees, Consultant may sign and file the following certification in lieu of insurance: V am aware of the provisions of California Labor Code Section < 3700 which requires every employer to be insured against liability for workers' compensation or to undertake self - insurance in accordance with the provisions of that code, and I will comply with the provisions of that code before commencing with and during the performance of the work of this contract. " D. Consultant shall furnish Commission with certificates and original endorsements effecting the required coverage prior to execution of this Agreement by Commission. The endorsements shall be on forms provided by Commission or as approved by City Attorney. Any deductible or self - insured retention over $100,000.00 shall be disclosed to and approved by Commission. If Consultant does not keep all required insurance policies in full force and effect, Commission may, in addition to other remedies under this Agreement, take out the necessary insurance, and Consultant agrees to pay the cost of said insurance. 15. . STANDARD OF CARE. Commission relies upon the professional ability of Consultant as a material inducement to entering into this Agreement. Consultant agrees to use reasonable care and.diligence in rendering services under this Agreement. Consultant agrees that the acceptance of his work by City shall not operate as a waiver or release of said obligation of Consultant. The absence, omission, or failure to include in this Agreement, items which are normally considered to be a part of generally accepted professional procedure or which involve professional judgment shall not be used as a basis for submission of inadequate work or incomplete performance. 4 16. COVENANT AGAINST CONTINGENT FEES. The Consultant warrants that he has not employed or retained any company or person; other than a bona fide employee working for the Consultant, to solicit or secure this Agreement, and that he has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration, contingent upon or resulting from the award or making this Agreement. For breach or violation of this warranty, the Commission shall have the right to annul this Agreement without liability, or, in its discretion to deduct from the. Agreement price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift, or contingent fee. 17. CONFLICT OF INTEREST. Consultant covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of its services hereunder. Consultant further covenants that in the performance of this Agreement, no person having any such interest shall be employed. 18. STATEMENT OF ECONOMIC INTEREST. If City determines Consultant comes within the definition of Consultant under the Political Reform Act (Government Code §87100), Consultant shall complete and file and shall require any other person doing work under this Agreement to complete and file a "Statement of Economic Interest" with the Clerk of the City of Rohnert Park disclosing Consultant and /or such other person's financial interests. 19. MERGER. This Agreement shall constitute the entire Agreement between the parties and shall supersede any previous agreements, whether verbal or written, concerning the same subject matter. No modification of this Agreement shall be effective unless and until evidence by a writing is signed by both parties. 20. DEFAULT. If Consultant should. fail to perform any of his obligations hereunder, within the time and in the manner herein provided or otherwise violate any of the terms of this Agreement, Commission may terminate this Agreement by giving Consultant written notice of such termination, stating the reason for such termination. In such event, Consultant shall be entitled to receive as full payment for all services satisfactorily rendered and expenses incurred hereunder, an amount which bears the same ratio to the total fees specified in the agreement as the services satisfactorily rendered hereunder by Consultant bear to the total services otherwise required to be performed for such total fee; provided,. however, that the Commission shall deduct from such amount the amount of damage, if any, sustained by Commission by virtue of the breach of the Agreement by Consultant. 21. NO WAIVER OF BREACH; TIME. The waiver by Commission of any breach of any term or promise contained in this Agreement shall not be deemed to be a waiver of such term or provision or any subsequent breach of the same or any other term or promise contained in this Agreement. Time is of the essence in carrying out the duties hereunder. 22. THIRD PARTY BENEFICIARIES. Nothing contained in this Agreement shall be construed to create and the parties do not intend to create any rights in third parties. 23. ATTORNEY FEES APPLICABLE LAW AND FORUM. In the event either party brings an action or proceeding for damages arising out of the other's performance under this Agreement or to establish the right or remedy of either party, the prevailing party shall be entitled to recover reasonable attorney fees and costs as part of such action or proceeding, whether or not such action or proceeding is prosecuted to judgment. This Agreement shall be construed and interpreted according to California law, and any action to enforce the terms of this Agreement or for the breach thereof shall be brought and tried in the County of Sonoma. 5 24. INDEPENDENT CONTRACTOR. The parties intend that Consultant, in performing the services specified herein, shall act as an independent contractor and shall have control of the work and the manner in which it is performed. Consultant is not to be considered an agent or employee of the City and is not entitled to participate in any pension plan, insurance, bonus or similar benefits City provides its employees. In the event City exercises its right to mi ternate this Agreement, Consultant expressly agrees that he /she shall have no recourse nor right of appeal under rules, regulations, ordinances or laws applicable to employees. 25. TAXES. Consultant agrees to file tax returns and pay all applicable taxes on amounts paid pursuant to this Agreement and shall be solely liable and responsible to pay such taxes and other obligations, including, but not limited to, state and federal income and FICA taxes. Consultant agrees to indemnify and hold the City and Commission harmless from any liability which it may incur to the United States for to the State of California as a consequence of Consultant's failure to pay, when due; all such taxes and obligations. 26. EMPLOYMENT PRACTICES. Consultant shall not discriminate in its performance under the Agreement either directly or indirectly on the grounds of race, color, religion, sex, age, national origin, or other prohibited grounds in its employment practices, and shall take affirmative steps to ensure that applicants are employed and employees are treated during employment without regard to race, color, religion, sex, age, national origin, or other prohibited grounds. 27. COMPLIANCE WITH LAW. Consultant shall comply with all applicable federal, state and local laws, rules and regulations affecting the Consultant and his /her work hereunder. Consultant represents and warrants to Commission that Consultant has all licenses, permits, qualifications and approvals of whatsoever nature which . are legally required for Consultant to practice Consultant's profession and to do the work hereunder. Consultant represents and warrants to Commission that Consultant shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement any licenses, permits, and approvals which are legally required for Consultant to practice his /her profession and do the work contemplated by this Agreement. 28. TITLE TO DOCUMENTS. Title to all plans, specifications, maps, estimates, reports, manuscripts, drawings, descriptions and other final work products compiled by the Consultant under the Agreement shall be vested in the Commission, none of which shall be used in any manner whatsoever, by any person, firm, corporation, or agency without the expressed written consent of the Commission. Basic survey notes and sketches, charts, computations, and other data prepared or obtained under the Agreement shall be made available, upon request, to the Commission without restriction or limitations on their use. Consultant may retain copies of the above - described information but agrees not to disclose or discuss any information gathered, discussed or generated in any way through this Agreement without the written permission of Commission during the term of this Agreement or until ninety (90) days after receipt of final payment from Commission. 29. INTERPRETATION. Notwithstanding the fact that one or more provisions of this Agreement may have been drafted by one of the parties to this Agreement, such provisions shall be interpreted as though they were a product of a joint drafting effort and no provisions shall be interpreted against a party on the ground that said party was solely or primarily responsible for drafting the language to be interpreted. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF ROHNERT PARK: By: Steve DorNey, City Manager Per Resolution No. 2004 -70 CONSULTANT: By: Linda Darnel Crocker, Prin ipal ATTEST-Z® �►%.d,aq . _� u0 'g CI CLE APPROVED AS TO FORM: IT ATTORNEY Pe 7 EXATBIT C PROMISSORY NOTE (Vida Nueva Property) Principal Amount: $1,630,000 May_, 2006 Rohnert Park, California FOR VALUE RECEIVED, the Community Development Commission of the City of Rohnert Park, a public body corporate and politic ( "Borrower" and "Commission "), having an address of 6750 Commerce Boulevard, Rohnert Park, California 94928, promises to pay to the City of Rohnert Park, a California municipal corporation ( "Lender" and "City "), the principal sum of ONE MILLION, SIX HUNDRED THIRTY THOUSAND AND 00 /100 DOLLARS ($1,630,000) together with interest on the unpaid principal balance from time to time outstanding at an annual rate and from such date as set forth below until fully paid, at 6750 Commerce Boulevard, Rohnert Park, California 94928 c/o Finance Director, or at such other place as Lender may from time to time designate in writing. 1. Pu ose. This promissory note ( "Promissory Note ") is made pursuant to that certain Cooperation, Reimbursement, and Purchase and Sale Agreement by and between Commission and City dated , 2006 ( "Cooperation Agreement "). This is a promissory note evidencing Borrower's obligations and promise to repay to Lender the funds pledged by Borrower to Lender in the amount of One Million, Six Hundred Thirty Thousand and 00 /100 Dollars ($1,630,000) ( "Loan ") pursuant to the Cooperation Agreement and referred to therein as the "Purchase Price ". 2. Interest. A. Amount of Interest. Simple interest on the unpaid principal balance shall accrue from the date of recordation of the Grant Deed, (as defined in the Cooperation Agreement) at the rate of five percent (5 %) per annum. B. Method of Calculating Interest. Interest shall be computed based on a 365 -day year and the actual number of days elapsed. Payment of Interest and Principal. A. Time. Borrower shall repay the Loan as follows: (a) January 1, 2007. Borrower shall make a payment consisting of one -third (1/3) of the original principal balance of the Loan together with all accrued interest to date. (b) January 1, 2008: Borrower shall make a payment consisting of one -third (1/3) of the original principal balance of the Loan together with all accrued interest to date. (c) January 1, 2009: Borrow shall make a payment consisting of any remaining Loan balance and any accrued interest. B. Application and Method. Each payment under this Promissory Note shall be credited in the following order: (a) costs, fees, charges, and advances paid or incurred by Lender or payable to Lender and interest under any provision of this Promissory Note or the Cooperation Agreement, in such order as Lender, in its sole and absolute discretion, elects, (b) interest payable under the Promissory Note, and (c) principal under the Promissory Note. All sums due under this Promissory Note are payable in lawful money of the United States. Checks constitute payment only when collected. 9108000B 80078/0022 C. Right To Prepay. Borrower may prepay the principal amount outstanding in whole or in part at any time without charge. Partial prepayments shall be accompanied by interest on the amount prepaid through the date of prepayment. All prepayments of principal on this Promissory Note shall be applied to the most remote principal installment or installments then unpaid. 4. Default. On: (a) Borrower's failure to pay any installment or other sum due under this Promissory Note when due and payable (whether by extension, acceleration, or otherwise), or (b) any material breach under this Promissory Note or the Cooperation Agreement, or in any other instrument now or hereafter securing the indebtedness evidenced by this Promissory Note, then, and in any such event, Lender may, at its option, declare this Promissory Note (including, without limitation, all accrued interest) due and payable immediately. 5. Remedies. If a default occurs, Lender may exercise any right or remedy which it has under this Promissory Note, the Cooperation Agreement, and/or which is otherwise available at law or in equity or by statute, and all of Lender's rights and remedies shall be cumulative. 6. Attorney Fees. Borrower agrees to pay any and all costs, expenses, and attorney fees paid or incurred by Lender, or adjudged by a court reasonable costs of collection and costs, expenses, and attorney fees paid or incurred in connection with the collection or enforcement of this Promissory Note and/or the Cooperation Agreement. 7. Waiver. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Promissory Note and all other notices or matters of a like nature, and expressly consent to -any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability. Borrower agrees to perform and comply with each of the covenants, conditions, provisions and agreements of Borrower contained in this Promissory Note, the Cooperation Agreement, and any other agreement or instrument evidencing, securing, or guaranteeing the indebtedness evidenced hereby. 8. Notice. Any notice required to be provided in this Promissory Note shall be given in writing and shall be sent: (a) for personal delivery by a delivery service that provides a record of the date of delivery, the individual to whom delivery was made, and the address where delivery was made; (b) by first -class certified United States mail, postage prepaid, return receipt requested; or. (c) by a nationally recognized overnight courier service, marked for next day business delivery. All notices shall be addressed to the party to whom such notice is to be given at the property address stated above or to such other address as a party may designate by written notice to the other. All notices shall be deemed effective on the earliest of (a) actual receipt; (b) rejection of delivery; (c) if sent by certified mail, the third day on which regular United States mail delivery service is provided after the day of mailing or, if sent by overnight delivery service, on the next day on which such service makes next - business -day deliveries after the day of sending. 9. Pledge, Not Secured by Deed of Trust. The obligations of Commission under this Agreement shall constitute a pledge and indebtedness of Commission within the meaning of Section 33670 et seq. of the Community Redevelopment Law, to be repaid to City as set forth herein and in the Cooperation Agreement. This Promissory Note is not secured by a Deed of Trust. 10. Forbearance Not a Waiver. If Lender delays in exercising or fails to exercise any of its rights under this Promissory Note, that delay or failure shall not constitute a waiver of any Lender rights 910800v1B 80078/0022 2 or of any breach, default, or failure of condition under this Promissory Note. No waiver by Lender of any of its rights or of any such breach, default, or failure of condition shall be effective, unless the waiver is expressly stated in a writing signed by Lender. 11. AssignMent. This Promissory Note inures to and binds the heirs, legal representatives, successors, and assigns of Borrower and Lender; provided, however, that this Promissory Note is personal to Borrower and is not assumable or assignable, and Borrower may not assign this Promissory Note or any proceeds of it, or assign or delegate any of its rights or obligations. 12. Governing Law. This Promissory Note shall be construed and enforceable according to the laws of the State of California for all purposes. 13. Usury. All agreements between Borrower and Lender are expressly limited, so that in no event or contingency, whether because of the advancement of the proceeds of this Promissory Note, acceleration of maturity of the unpaid principal balance, or otherwise, shall the amount paid or agreed to be paid to Lender for the use, forbearance, or retention of the money to be advanced under this Promissory Note exceed the highest lawful rate permissible under applicable usury laws. This provision shall control every other provision of all agreements between Borrower.and Lender in relation to the Loan, including the Cooperation Agreement.. 14. Time Is of the Essence. Time is of the essence under this Promissory Note. 15. Authorization; Joint and Several. Each individual or entity executing this Promissory Note on behalf of Borrower represents and warrants that he or she or it is duly authorized to execute and deliver this Promissory Note on behalf of Borrower and that such execution is binding upon Borrower. 16. Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to the obligations evidenced by this Promissory Note is waived to the fullest extent permissible by law. 17. Severability. If any provision of this Promissory Note, or the application of it to any party or circumstance, is held void, invalid, or unenforceable by a court of competent jurisdiction, the remainder of this Promissory Note, and the application of such provision to other parties or circumstances, shall .not be affected thereby, the provisions of this Promissory Note being severable in any such instance. 18. Representation on Use of Proceeds. Borrower represents and warrants to Lender that the proceeds of this Promissory Note will be used solely for acquisition of the Vida Nueva Property (as defined in the Cooperation Agreement) and other costs permitted under the Cooperation Agreement. 19. Inte ation. This Promissory Note and the Cooperation Agreement embody the agreement between Lender and Borrower for the Loan and its terms and conditions. If any term of this Promissory Note is inconsistent with any term of the Cooperation Agreement, then the terms of this Promissory Note shall govern. 20. Modifications. Any waiver, change, modification, release, or discharge of this Promissory Note and/or Borrowers obligations hereunder may be made only by the prior written consent of both Lender and Borrower. [Signature follows on next page] 910800vIB 80078/0022 IN WITNESS WHEREOF, Borrower has executed this Promissory Note the day and year first above written. Dated: BORROWER: COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF ROHNERT PARK, a public body corporate and politic By: _ Name: Title: [Signature must be ,notarized] ATTEST: Commission Secretary APPROVED AS TO FORM: General Counsel 910800v1B 80078/0022 4