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06/15/00 15:49 FAX 6512233002 SPRINGSTED INC. Q(, 115 Conclusion As an outside consultant I have analyzed the condition of the subject buildings and the evidence . is reasonable and the evaluations are based on the estimated cost of code(building)compliance for the structural,mechanical, electrical,heating HVAC,life safety,egress,occupancy loads, Americans with Disabilities Act,and energy conservation requirements needed for compliance. The subject property located in the City of St.Anthony,Mm is an area of troubled buildings requiring substantial renovation or clearance and may exhibit deficiencies in other categories such as utilities,facilities, light,ventiWion,fire protection,(or lack thereof)egress, interior partitions and unknown factors(there exists PCB containing transformers in this building)such as asbestos abatement,pollution,lead based paints and the need for thermal energy conservation to comply with the building code. Findings Therefore the cost to modify the existing buildings, determined by the aforementioned statutory formula,exceeds the 15%cost of constructing a new building on the some site and with reasonable certainty qualifies the subject properties according to Minnesota Statutes Section 469.174 Subd 10.(a)as described above and concludes the finding that more than 50% (2 out of 2 buildings or 100%) of the parcels with buildings are structurally substandard . Reconnaissance was conducted in May and June of 2000 and did include an informal interior view of those buildings open to the public. The City of St Anthony sent letters to all owners requesting an interior evaluation of their ownership. As you are aware the City of St Anthony must create a District pursuant to a determination on the"But for"question and"Public Purpose"requirements inherent in all Redevelopment Districts. There are two different approaches to utilize TIF funds to finance future public redevelopment costs that impact this site. The statutory constraints and short term of the existing district may undermine project feasibility and inhibit redevelopment. The alternative method is to decertify the parcels from the existing district and establish a new TIF district to finance new project costs and that is the perspective in which I have analyzed this project assignment Since the shopping center has been predominantly vacant for many years it is reasonable to assume that the consent for TIF approval could be obtained from the City of St. Anthony. Calculations A typical (example)calculation of a commercial building would contain 1000 square feet times S45 dollars per square foot for replacement cost(Marshall Swift Replacement Cost not including land value)equals S 45,000 times 15%equals approximately$6750 and the cost of necessary renovation was estimated at$15,000 to 20,000 thousand dollars,thereby exceeding the threshold ($6750)of the statutory formula and qualifying the subject properties structurally substandard in accordance with Laws of Minnesota 469.174 Subdivision 10 Clause 2 a. (an example of a commercial/retail type building calculation) This concludes my analysis-Call me if I can be of further assistance to your redevelopment needs at(612)724-4843 or 888-6450 cc Nick Scarich, Springsted Corp.