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PNW Economics <br /> <br />Page 2 <br />Prepared for: City of Eugene <br />Prepared by: PNW Economics <br />Response to MUPTE Citizen Advisory Committee Meeting #2 Questions <br /> <br />rates are aggressive assumptions. Therefore, the pro forma analysis for each scenario was <br />revised to more reasonably assume 37% absorption vacancy in Year 1. <br /> <br />Table 1 – Year 1 Monthly & Average Absorption and Vacancy Analysis <br /> * Reflects 20% occupancy in the first month of active operations. <br /> <br />Tables 2, 3, 4 and 5 provided revised pro forma results given revisions described for Questions 1 <br />and 2. Overall, revised results point to weaker Year 1 performance for all scenarios with worse <br />losses than originally estimated. After Year 1, the corrected, lower operating expenses <br />estimates help the project perform better than originally estimated. But overall, the project is <br />expected to have a chance at performing adequately only if it is awarded a ten-year MUPTE. <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />Monthly Occupied Vacant Vacancy <br />Month Absorption Units Units Rate <br />1 25*25 102 80% <br />2 9 34 93 73% <br />3 9 43 84 66% <br />4 9 52 75 59% <br />5 9 61 66 52% <br />6 9 70 57 45% <br />7 9 79 48 38% <br />8 9 88 39 31% <br />9 9 97 30 24% <br />10 9 106 21 17% <br />11 9 115 12 9% <br />12 5 120 7 6% <br />Year 1 Absorption Vacancy Rate:42% <br />October 17, 2018, Work Session – Item 2