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THE CONCORD GROUP <br />Marketability <br />The project's marketing strengths are as follows: <br />• Regional Accessibility— the project site is easily accessible to the target renter and consumer base, with freeway and <br />rail access each less than a mile away (Exhibit 4C). <br />• Proximity to Jobs— several major Orange County office employment nodes are within a five -mile radius of the project, <br />including Downtown Santa Ana, South Coast Metro, Irvine Business Complex and Town and Country, driving demand <br />for both apartments and commercial space. <br />• Cultural and Entertainment Amenities — the Project is located proximate to the city's Downtown and Artists Village, <br />home to numerous galleries and popular restaurants that possess regional draws (Exhibit 4q. <br />• Shortage of State -of -the -Art Apartments — Santa Ana is under -supplied with Class A rental apartment product, <br />evidenced by high rates of occupancies and rapid rent growth over the past five years (Exhibit <br />The project's marketing challenges are as follows: <br />• Distressed Retail Environment— the rise of e-commerce has had a significant negative impact on "brick- and -mortar" <br />retailers, leading to store closures across the retail landscape. The negative effects of e-commerce have been especially <br />apparent during the current pandemic which has served to accelerate store closings and overall retail contraction <br />(Appendix C). <br />Apartment Market Performance <br />• TCG surveyed eight comparable rental projects in the CMA, representing best -in -class product in the cities of Santa <br />Ana, Costa Mesa, Irvine, Tustin, Orange and Anaheim (Exhibit 8A). <br />• The average base rent (ie. an average of the lowest listed rent for each floorplan, excluding premiums for views, <br />orientation and elevation) of the eight comparables surveyed is $2,606, or $2.88 per square foot ("PSF") — top of <br />market rents include Skyloft (average base rent of $3,024, $3.32 PSF) and Eleven 10 ($2,571, $3.12). <br />ARNEL DEVELOPMENT CO. August 2020 <br />Santa Ana — 4'" & Cabrillo Park Dr 20233.00 <br />