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ATTACHMENT E <br /> <br /> April 1, 2005 <br /> <br /> Walter A. Graft III <br /> Nathan Philips <br /> W & G Properties <br /> 541 Willamette Street <br /> Eugene, OR 97401 <br /> <br /> Dear Wally and Nathan, <br /> <br /> I am writing to elaborate on previous discussions we have had regarding the viability of <br /> retail space in your proposed project on Martin Luther King Boulevard. Besides general <br /> conceptual concerns about the viability of the node concept on this site, I have serious <br /> economic concerns based on my experience. Let me elaborate. <br /> <br /> My partner, Jeff Elder, represented the developers of one of the larger apartment projects <br /> in the Chase Village area. They were persuaded, in the development process, to create a <br /> small retail center within the apartment area. Since the building was built three years <br /> ago, there is one space in the center that was unleased and unoccupied until December <br /> when a coffee vendor moved in. The convenience store appears to be making it, but <br /> only because of the volume of alcohol that is sold from the premises. The "pub," or <br /> neighborhood bar, has struggled from the beginning. The original owner partnership <br /> split, and the remaining partner will assign the business to the current manager at the end <br /> of the lease term. A hair salon lease is in good standing, so it apparently is getting by. <br /> Rents are low, at $1.05 per square foot. When the small strip center was built, the <br /> neighborhood hoped for a grocery store. Jeff contacted all of the major grocery chains <br /> and was rejected by every one. He then went to the main convenience store operators, <br /> and only after concerted effort, found an independent operator willing to run the <br /> business. Jeff feels that without the alcohol sales, it would be a challenge for even a <br /> convenience store to succeed in that location. <br /> <br /> Down the road, just a few blocks away, Centennial Shopping Center is an older <br /> neighborhood center, that under the new "node" concept should be a rousing success. It <br /> is surrounded by housing, and is on a busy street that links Eugene and Springfield. In <br /> fact, the center has been plagued with vacancies. It has a failed grocery store and the <br /> corner, "pad site," has never sold. The rental rates have declined over time to remarkably <br /> low rates (from 66¢ to 83¢ per square foot), and the difficulty of attracting businesses to <br /> the center is an ongoing challenge. <br /> <br />101 East Broadway <br />Suite 101 <br />Eugenc, OR 97401 <br />TEL: (541) 345-4860 <br />FAX: (541) 345-9649 <br /> <br /> <br />