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LEB Development - -Phase II <br />Page 2 <br />The City's agreement with LEB Development is to write down the acquisition <br />cost to $1.35 per square foot. The acquisition cost has been defined to <br />include the purchase price, real estate commissions, and "hard" <br />demolition /redevelopment costs. Based upon information received from the <br />developer, the proposed structure of the City assistance is as follows: <br />Purchase Price $188,390 <br />Real Estate Commission 18,839 <br />Demolition /Redevelopment 6810 <br />TOTAL ACQUISITION COST $214,039 <br />Less: Repurchase Cost @ $1.35/s.f. 72,663 <br />NET TIF ASSISTANCE $141,376 <br />We have received cost verifications and a copy of the survey to accurately <br />project the acquisition costs. <br />We also discussed the amount of brokerage commission paid on the first <br />phases of the project. Mr. Brueggemann had to pay out a 10 percent <br />commission for the initial acquisition due to the speculative nature of the <br />project. He has confirmed, however, that future commissions will be at a <br />reduced rate. <br />The estimated future market value of this project is $650,000, which will <br />result in a "net increment" of approximately $32,000 per year. This would <br />result in a bond issue of approximately 8 -9 years to service this debt. <br />Page 15 <br />