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R.A. Morton & Associates, Inc. <br />Little Canada Office Building <br />Discussion Outline <br />For 2 -13 -02 Council Meeting <br />CONSTRUCTION MANAGERS <br />821 West St. Germain <br />St. Cloud, MN 56301 <br />Bus. (320) 251 -0262 <br />Fax: (320) 251 -5749 <br />www.ramorton.com <br />Financing Update: <br />A) Conventional <br />1) Require 45% pre - leased for $2,250,000 mortgage <br />2) Require a 1.20 debt service coverage to move from construction to permanent <br />financing <br />3) Pre - leasing is extremely difficult <br />4) Lenders remain difficult for even stabilized properties. <br />B) Little Canada to fund construction to 50% pre - leased <br />1) Adds bonding cost <br />2) Reduces over -all time line due to concurrent activities <br />Architectural Plan Update: <br />A) Proposed change to a two story building that would be quite high(approximately 30' -32') <br />vs. neighborhood retail /housing project <br />1) Rice Street view shows a more substantial presence vs. (3) smaller floors <br />2) Parking lot side of building has a more welcoming entrance and generally a better <br />appearance vs. a box. <br />B) Our material choices for exterior finishes appear to be consistent with our proposed <br />neighbor to the south. <br />C) We are currently looking at the cost/benefit to add a third floor of condominium housing <br />and underground parking. <br />D) Plan proposed is currently a "B" plan to respond to a $13 lease rate. <br />Marketing: <br />A) Conventional financing will drive a pre -lease requirement <br />B) Plan development and marketing packages are currently being developed. <br />C) Prospects include: <br />1) Dentist 3000 SF <br />2) Attorney Group 3000 SF <br />3) Engineering Firm 15,000 SF <br />4) R. A. Morton Branch Office Under consideration <br />5) Business Center 4000 SF <br />Timing: <br />A) Financing drives this <br />1) Option I — Conventional <br />2) Option II — Public Financing <br />3) Option 111 — Blend I & II <br />