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ta <br />www.FinanceDTA.com <br />SECTION V <br />RESIDENTIAL PROJECTS PROPOSED IN <br />THE SPECIFIC PLAN <br />As can be seen in Figure 9, effective market rental rates within the 2-Mile Zone have been steadily <br />increasing for 10 years, and there was a limited compound negative impact related to COVID-19. This <br />compounded rate is about 4.5% and forecasted to increase by a compounded rent growth of about 2.2% <br />for the next 5 years. It is difficult to project absorption rates in the 2-Mile Zone since there are few new <br />similar offerings. As of early 2023, there are only 200 units currently under construction, with delivery <br />scheduled in late 2023. <br />From a market perspective, the 2-Mile Zone has <br />the following desirable characteristics. <br />■ An urban setting close to shopping and <br />entertainment; <br />■ Adjacency to the South Coast Plaza <br />Mall; <br />■ Limited new high -end rental units <br />planned in the immediate future; <br />■ Multiple product types to attract a <br />variety of tenants; <br />Figure 9: Effective Average Rent per Unit <br />Market Effective Rent Per Unit <br />$3,400 <br />$3,200 <br />$3,000 <br />$2,800 <br />$2,600 <br />$2,400 <br />$2,200 <br />$2,000 <br />$1,800 <br />1111[LLglIIITH]I 1.1.1, 1 <br />14 16 18 <br />■ A mixed -use environment that includes <br />adjacent retail; <br />■ Proximity to the Orange County Art Center; <br />■ Proximity to Orange County Airport and Santa Ana Metrolink; <br />■ Direct access to Interstate 405 and SR 55; <br />■ Up to 13 acres of open space, including 5.0 acres of parks and Greenlink trails; and <br />■ Availability of local private schools, including Mater Dei, TVT Community Day School, and The Sage <br />School. <br />It also has some challenges that include: <br />■ Average public school district. The Santa Ana school system is ranked 814 out of 1,165 districts in <br />California (https://www.publicschoolreview.com/caIifornia/santa-ana-unified-school- <br />district/635310-school-district). <br />■ Currently high long term interest rates. <br />■ Future higher long-term interest rates resulting from Federal Reserve Bank tightening. <br />Related Bristol at 3600 South Bristol Street <br />Draft Market Study Report <br />September 2023 <br />Exhibit 10 <br />12 <br />