Market Study of Prepared for Boulder, Colorado 80304 By ... · 90 Madison Street, Suite 403 REAL...

Denver, Colorado

Market Study of

Proposed Palo Park Apartments 4525 Palo Parkway

Boulder, Boulder County, Colorado 80301

Prepared for

Boulder Housing Partners 4800 North Broadway

Boulder, Colorado 80304

As of

January 25, 2016

By

Stephen E. Ross, Market Analyst William M. James, MAI, CCIM

Copyright © 2016 James Real Estate Services, Inc.

All Rights Reserved.

90 Madison Street, Suite 403 R E A L E S T A T E D E C I S I O N S U P P O R T Denver, Colorado 80206-5412

main: 303-388-1100 fax: 303-388-8756

www.jres.com

January 25, 2016 Boulder Housing Partners 4800 North Broadway Boulder, Colorado 80304 Attention: Lauren Schevets, Development Project Manager SUBJECT PROPERTY: Proposed Palo Park Apartments

4525 Palo Parkway Boulder, Boulder County, Colorado 80301

JRES File No. 2015-162 RS Ladies and Gentlemen:

At your request, we have prepared a market study of the referenced real property in accordance with the methodology outlined in the Colorado Housing and Finance Authority’s 2016 Market Study Guide. The real estate was inspected on January 12, 2016 and other dates, and the market information contained herein was collected within the last 90 days, is accurate and can be relied upon by CHFA to present a comprehensive assessment of the local market for the subject project. The date of this report represents the market study completion date. Per CHFA requirements, this report is assignable to “lenders and/or syndicators that are parties to the development’s financial structure.” In addition, the market study may be shared with the Department of Housing and Urban Development as part of HUD’s assistance to CHFA in the analysis of this market study. Otherwise, this market study may not be used or relied upon for any purpose whatsoever by anyone other than the addressee of this letter, CHFA, HUD, and parties directly related to the intended use described herein, without our express written consent.

We certify that we have no present or contemplated future interest in the real property beyond this market study.

Respectfully submitted,

Stephen E. Ross Director of Market Analysis Voice: 303-316-6761 Email: [email protected]

William M. James, MAI, CCIM Principal Voice: 303-316-6768 Email: [email protected]

Attachments: Market Study Report

TABLE OF CONTENTS

Subject Photographs ................................................................................................................................... 1

MARKET STUDY SYNOPSIS ........................................................................................................................ 6

Project Description..................................................................................................................................... 7 Subject Unit Summary ................................................................................................................................ 7 Rent Comparison ........................................................................................................................................ 8 Comparability Analysis............................................................................................................................... 9 Demand and Capture Rate .......................................................................................................................... 9

PROJECT STRENGTHS AND WEAKNESSES ......................................................................................................... 10 Recommendations and Conclusions .......................................................................................................... 11

FACTUAL DESCRIPTIONS ......................................................................................................................... 12

Denver Metropolitan Area Map ................................................................................................................ 13 Local Area Map ........................................................................................................................................ 14 Aerial Photo ............................................................................................................................................. 15

PROJECT DESCRIPTION ................................................................................................................................... 16 Design & Site Plan ................................................................................................................................... 16 Project Units ............................................................................................................................................ 16 Unit Rent and AMI Targets ....................................................................................................................... 17 Amenities .................................................................................................................................................. 17 Parking & Utilities ................................................................................................................................... 17 Development Timeline .............................................................................................................................. 18 Land Survey .............................................................................................................................................. 19

ANALYSIS OF DATA AND OPINIONS OF MARKET ANALYST ........................................................... 20

LOCATION ANALYSIS ..................................................................................................................................... 21 Project Location ....................................................................................................................................... 21 Location Amenities ................................................................................................................................... 21 Flood Map ................................................................................................................................................ 23 Local Amenities Map ................................................................................................................................ 24 Surrounding Land Use .............................................................................................................................. 25 Proximity to Jobs ...................................................................................................................................... 25 Marketability ............................................................................................................................................ 28 Walk Score & Transit Score ...................................................................................................................... 28

MARKET BOUNDARIES ................................................................................................................................... 29 Market Boundaries Map ........................................................................................................................... 30

MARKET CONDITIONS .................................................................................................................................... 31

BOULDER – EXCEPT UNIVERSITY AREA APARTMENT MARKET .................................................. 32

AVERAGE APARTMENT RENTS ............................................................................................................. 34 COMPARABILITY ANALYSIS............................................................................................................................ 37

Inventory .................................................................................................................................................. 37 Selection of Comparables ......................................................................................................................... 38 Walk Score & Transit Score of Comparables ............................................................................................ 41 Market Comparables Map ........................................................................................................................ 42 Comparative Analysis ............................................................................................................................... 43 Unit Size & Mix ........................................................................................................................................ 45 Rent Comparisons..................................................................................................................................... 46

Vacancies & Wait Lists ............................................................................................................................. 48 Absorption ................................................................................................................................................ 49 Upcoming Competition ............................................................................................................................. 50

DEMOGRAPHIC DATA AND DEMAND ANALYSIS ............................................................................... 51

DEMAND ANALYSIS ....................................................................................................................................... 60 RECOMMENDATIONS AND CONCLUSIONS ........................................................................................................ 64

ADDENDA A. Comparable Property Photos B. Qualifications of Market Analysts and Company Profile

SUBJECT PHOTOGRAPHS

LOOKING NORTHWEST FROM SOUTHEAST CORNER OF THE SUBJECT

PALO PARKWAY IS AT LEFT

SUBJECT PHOTOGRAPHS

LOOKING EAST FROM SUBJECT AT ADJACENT PROPERTY (PLEASANT VIEW FIELDS SPORTS COMPLEX)

SUBJECT PHOTOGRAPHS

LOOKING NORTHEAST FROM SOUTHWEST CORNER OF THE SUBJECT

PALO PARKWAY IS AT RIGHT

SUBJECT PHOTOGRAPHS

LOOKING SOUTH ACROSS PALO PARKWAY FROM SUBJECT AT ADJACENT PROPERTIES

RIDGEWAY STREET IS AT CENTER

SUBJECT PHOTOGRAPHS

LOOKING WEST ALONG PALO PARKWAY

SUBJECT IS AT RIGHT LOOKING EAST ALONG PALO PARKWAY

SUBJECT IS AT LEFT

MARKET STUDY SYNOPSIS 6

MARKET STUDY SYNOPSIS


Project Description The subject property is a proposed affordable apartment complex planned for a 3.216-acre site on the north side of Palo Parkway at its eastern terminus across from its intersection with Ridgeway Street in the City of Boulder, Boulder County, Colorado. The proposed development at this site is anticipated to include approximately 35 affordable multifamily units. A general site plan for the project is found later in this report. The initial plans for the subject property includes 13 one-bedroom units, 14 two-bedroom units, and 8 three-bedroom units. The site is being developed in partnership with Habitat for Humanity (HFH), with HFH developing nine homeownership units, which are not covered by this market study. The LIHTC apartments will be cooled via a fan coil system fed by a condensing unit, and will be heated by a fan coil unit fed by the tankless water heater in each unit. Apartments will include a dishwasher, refrigerator, stove/oven, garbage disposal, and washer and dryer units. Porch/patios are also anticipated to be included in most apartments along with an external bike storage for each unit. Unit finishes are to be basic and consistent with other Boulder Housing Partners properties.

Subject Unit Summary

30% AMI

40% AMI

50% AMI

60% AMI

Market Units Total Size (SF) Type

Studio Units 1 Bedroom Units 2 3 4 4 0 13 750 SF Flat 2 Bedroom/1 Bath Units 1 2 3 2 0 8 1,000 SF Flat 2 Bedroom/1.5 Bath Units 1 1 2 2 0 6 1,000 SF Flat 3 Bedroom/2 Bath Units 1 2 3 2 0 8 1,250 SF Flat 4 Bedroom/1.5 Bath Units 4 Bedroom/2 Bath Units Total 5 8 12 10 0 35 % of Total 14% 23% 34% 29% 100%

As per CHFA guidelines, the subject rents will target the 30%, 40%, 50%, and/or 60% AMI levels. The breakdown of nearby properties is listed below.


Rent Comparison

Rent per Unit Subject

Property Broadway

West Foothills

Community WestView Ledges on 29th

HUB Apartments

Uptown Broadway

1 Bedroom Units 30% AMI $516 $691 40% AMI $708 $691 50% AMI $899 $877 $877 $846 $953 60% AMI $1,091 $1,019 $992 Market Rent $1,250 $1,490-$1,525 2 Bedroom/1 Bath Units 30% AMI $620 40% AMI $850 50% AMI $1,080 $1,053 $1,016 60% AMI $1,310 Market Rent 2 Bedroom/2 Bath Units 30% AMI $620 40% AMI $850 $830 50% AMI $1,080 $1,053 $1,053 $1,145 60% AMI $1,310 $1,277 $1,342 $1,142 Market Rent $1,600 $2,080-$2,380 3 Bedroom/2 Bath Units 30% AMI $711 $954 40% AMI $977 $954 50% AMI $1,242 $1,212 $1,212 $1,169 60% AMI $1,508 $1,471 Market Rent $2,150 $2,780-$2,830 Studio Units 30% AMI 40% AMI 50% AMI 60% AMI $1,009 Market Rent All rents are net rents excluding concessions, utilities allowances or market rate utility adjustments.


Comparability Analysis The subject property is rated in comparison to key attributes of the market comparables as follows:

Broadway

West Foothills


HUB Apartments

Uptown Broadway

Rents NA NA NA NA NA NA Unit Size - + + + + - Unit Mix = = - = = - Quality = = = = - + Amenities + + + = = - Location + = + - + +

Scale: - (Inferior to Subject); = (Equal to Subject); + (Superior to Subject)

Demand and Capture Rate

30% AMI

40% AMI

50% AMI

60% AMI

Market Units Total

Total Renter HH in Market Area 18,227 Unserved HH based on Size (If Any) = Size-eligible Renter HH 18,227 x Percent Income Qualifying HH in Market Area 7% 8% 10% 12% = Income Qualifying HH In Market Area 1,337 1,454 1,842 2,189 6,822 + In-migration of HH (If Any) 0 0 0 0 = Total Qualifying HH (Demand) 1,337 1,454 1,842 2,189 11,405 6,822 Existing Units 5 70 252 153 480 Capture Rate - Existing 0.4% 4.8% 13.7% 7.0% 7.0% Under Construction/Planned Units Residences at Sutherland Park (aka SPARK) 0 0 36 9 45 Proposed project - Eagles Nest 0 0 0 36 36 Subject Units-Palo Park (Proposed) 5 8 12 10 35 Total Existing & Under Construction Units 10 78 300 208 596 Capture Rate 0.7% 5.4% 16.3% 9.5% 8.7% Demand Less Existing & Proposed Units 1,327 1,376 1,542 1,981 6,226


Project Strengths and Weaknesses Strengths

The subject site is well located in north-central Boulder in an established residential area near several parks and public recreational amenities.

Current capture rates are relatively low, with the exception of 50% AMI, and high demand for affordable housing is present in the subject’s market area.

Boulder is a strong and stable employment market with an unemployment rate that is 1.5 percentage points below the national average.

Strong affordable unit demand across all AMI levels and unit floor plan sizes. The subject’s new construction status will be competitive with new units coming online in the

market as well as the existing LIHTC unit inventory in Boulder. The marketing and management experience of Boulder Housing Partners, based on their past

history and existing portfolio, will help ensure the success of the subject units. Weaknesses

Relatively low Walk Score and limited public transportation options compared to other areas of Boulder.

Subject site is nearly one mile from the nearest BVSD public elementary school. Several new or redeveloped affordable projects have come on line in the recent past, and are

anticipated to in the near future, in central Boulder.


Recommendations and Conclusions

Market Demand 5 Project Location 3 Proposed Unit Mix 5 Proposed Unit Sizes 5 Proposed Rents 4 Overall Marketability (as proposed) 4 Marketability with Recommendations: 5 Scale: 1 (not strong) to 5 (very strong)

The subject site has a good location in terms of access to the property, proximity to employment,

a neighborhood feel, and access to nearby recreational amenities. Market data supports strong demand across all unit types, as evidenced by both low vacancies

and quick lease-up of new affordable projects in the last 12 months. Currently 30% AMI and 40% AMI levels are the least served sectors by existing peer group

properties. A second full bathroom in the two-bedroom floor plans at the subject would help them to be

more competitive in the market. In-unit washers and dryers are an amenity that will help to set this project apart from other

competing complexes. Incorporating “green” (i.e. environmentally friendly and/or environmentally sustainable) concepts

or initiatives into the final development should be considered to best position the proposed project for future CHFA Low Income Housing Tax Credits.

FACTUAL DESCRIPTIONS 12

FACTUAL DESCRIPTIONS

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DENVER METROPOLITAN AREA MAP

0 mi 5 10 15

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LOCAL AREA MAP

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AERIAL PHOTOGRAPH


Project Description

Design & Site Plan The proposed subject property is anticipated to be a 35-unit affordable multifamily development on a site located at northeast end of Palo Parkway its intersection with Ridgeway Street. The subject property’s initial unit mix is 13 one-bedroom units, 14 two-bedroom units, and 8 three-bedroom units as well as a leasing office, a clubhouse/community room, a small playground or play area for neighborhood children, and community gardens. A conceptual design of the site is included below. The 3.216-acre subject site consists of one platted parcel and is zoned Suburban Residential (SR) by Boulder County. The City of Boulder boundary line currently runs down the middle of Palo Parkway with most of the south side of the street falling within the City of Boulder; however, properties along the north side of Palo Parkway reside outside of the City of Boulder in Boulder County. Despite its former location in unincorporated Boulder County, the subject site was owned by the City of Boulder and the transfer of ownership to Boulder Housing Partners has been completed. In additional to transferring the ownership to BHP to facilitate the development of the subject site, the City of Boulder on January 5, 2016 approved the annexation and rezoning the subject parcel to Residential - Mixed 2 (RMX-2), which is consistent with the existing neighborhood on the south side of Palo Parkway. The proposed development is an allowed use under the former County zoning and the new City rezone. The subject parcel is a trapezoid-shaped piece of property, with the north boundary running along Fourmile Canyon Creek, and it is immediately adjacent to the Pleasant View Fields Sports Complex to the east and East Palo Park to the north across the creek. The preliminary site plan for the subject property is not yet complete, but vehicle access at project completion will likely be from Palo Parkway along the south boundary of the property. A copy of the property’s land survey is below.

Project Units The subject property is currently anticipated to be comprised of 13 one-bedroom/one-bath units, 6 two-bedroom/1.5-bath townhome units, 8 two-bedroom/one-bath flat-style units, and 8 three-bedroom/two-bath units. One-bedroom units are anticipated to be approximately 750 square feet in size, two-bedroom units will be roughly 1,000 square feet, and three-bedroom units will be around 1,250 square feet at the subject when constructed. Each floorplan will include refrigerator, stove/oven, dishwasher, in-sink disposal, and full-size washer and dryer units. Unit finishes are anticipated to be typical of other Boulder Housing Partner properties in this market, in other words fairly basic counter and cabinet finishes.


Unit Rent and AMI Targets As mentioned, the units will be targeting residents with incomes at the 30%, 40%, 50%, and/or 60% AMI levels. One-bedroom units, which average 750 SF, have projected rents of $516 (30% AMI), $708 (40% AMI), $899 (50% AMI), and $1,091 (60% AMI). Two-bedroom/one-bath units and two-bedroom/1.5-bath units, which will be approximately 1,000 SF in size, have projected rents of $620 at 30% AMI, $850 at 40% AMI, $1,080 at 50% AMI, and $1,310 at 60% AMI. Finally, three-bedroom/two-bath units, which will be 1,250 SF in size, have projected rents of $711 (30% AMI), $977 (40% AMI), $1,242 (50% AMI), and $1,508 (60% AMI). All of these rents are net of utility allowances. Minimum and maximum incomes needed at the various AMI levels to afford the proposed rents assuming that 40% of income goes toward rent are as follows:

1-person 2-person 3-person 4-person 5-person Min Max Min Max Min Max Min Max Min Max 30% AMI $16,770 $20,880 $16,770 $23,880 $20,130 $26,850 $23,250 $29,820 $23,250 $32,220 40% AMI $22,380 $27,840 $22,380 $31,840 $26,850 $35,800 $31,020 $39,760 $31,020 $42,960 50% AMI $27,960 $34,800 $27,960 $39,800 $33,540 $44,750 $38,760 $49,700 $38,760 $53,700 60% AMI $33,570 $41,760 $33,570 $47,760 $40,260 $53,700 $46,530 $59,640 $46,530 $64,440

Amenities As of this time, project amenities at the subject are still being finalized, but are currently anticipated to be fairly minimal and consist of at least a leasing office, a clubhouse or community room with kitchen and activity room areas, community Wi-Fi, a small playground or play area for neighborhood children, a picnic/BBQ area, and community gardens. Residents of the subject will also have easy access the recreational opportunities afforded by East Palo Park and Pleasant View Fields Sports Complex, which are described in more detail below in Location Amenities.

Parking & Utilities The project is anticipated to include surface spaces at a ratio of 1.54/unit, and some street parking is also available. Similarly, utility service within the project will be determined during the project design phase, but electricity, natural gas, and water service are preliminarily slated to be tenant-paid utilities, with sewer and trash at the subject anticipated to be paid by the landlord. Hot water for each unit will be generated from a tankless water heater in each unit that will be a gas-fired, sealed combustion system. Space heat for each unit will be via a fan coil unit fed by the tankless water heater, and unit cooling will be from a fan coil system fed by a condensing unit.


Development Timeline Boulder Housing Partners has not finalized the development timeline for this project, but it is anticipated to be as follows: Entitlements Complete - October, 2016 Construction Start - November, 2016 Construction Complete - December 31, 2017

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ANALYSIS OF DATA 20

ANALYSIS OF DATA AND OPINIONS OF MARKET ANALYST

ANALYSIS OF DATA 21

Location Analysis

Project Location The subject property is a proposed affordable family/workforce apartment complex at the east end of Palo Parkway on the north side of the block. Vehicle access to the site is currently from Palo Parkway via 28th Street (aka U.S. Highway 36). Foothills Parkway and 28th Street are the main north-south thoroughfares in this area of Boulder and, along with Iris Road/Diagonal Highway (an east-west street), provide the primary access to the nearby neighborhood. The site is basically level, with a very slight downward slope towards the northeast corner of the property as seen above on the Land Survey. Currently, the subject site is vacant land and does not appear to have been previously developed. The property is not located within, but is located near to, a 100- or a 500-year floodplain as can be seen on the Flood Map on the following page.

Location Amenities The property is located on the north side of Palo Parkway approximately two blocks east of 28th Street, which serves as one of the major north-south arterial streets through the City of Boulder. Zoning along 28th Street is mostly commercial, and retail and office uses line each side of this major street to the north and south of the subject site. Approximately two blocks south of the subject is the Diagonal Highway and the Diagonal Plaza retail center, which is home to the new Wal-Mart Neighborhood Market. Future residents of the subject development will also be able bike or ride a bus to a nearby Target store, approximately six blocks south of the subject site, at 30th and Pearl Streets. Further south is the Twenty Ninth Street retail district, a major shopping and entertainment destination. Just east of the Target store on Pearl Street is the new Boulder Junction. Boulder Junction, previously known as the Transit Village, is a 160-acre area that, according to the City of Boulder, “will be transformed into a lively, mixed-use, pedestrian-oriented place where people will live, work and shop. It will become a new neighborhood as well as an attractive destination for other residents and visitors, with regional bus transit connections and public spaces that will benefit the entire Boulder community.” One of the elements of Boulder Junction is the RTD Depot Square, which serves as a mixed-use, transit-oriented development and includes an underground bus station (for local and regional bus lines), a new Hyatt Place hotel, an affordable apartment complex, a parking structure, a restaurant or pub within the restored Historic Train Depot, and an open plaza. Depot Square commenced construction in the summer of 2013 and much of it has been completed. Next to Depot Square is Junction Village, a private development that will include a 319-unit apartment complex in four separate buildings and seven retail spaces in 8,112 SF of space. There will be a two-level, partially below ground, wrapped parking

ANALYSIS OF DATA 22

structure for 363 vehicles. The site will also include a recreation center, multi-use paths and a variety of interior courtyard spaces. Grocery stores, retail and service outlets, medical and childcare facilities, restaurants as well as area schools and parks are all located in the surrounding area. Residents of the subject will also have easy access the recreational opportunities afforded by East Palo Park and Pleasant View Fields Sports Complex. East Palo Park is a neighborhood park featuring a recently renovated playground with play structures that emulate a forest environment, a sandbox and rock climbing structures; open turf; and paved walking paths as well as picnic tables and shade structures. Pleasant View Fields Sports Complex is an award-winning sports field complex with nine sand-based soccer/rugby fields along with restrooms and picnic tables. The fields are home to youth and adult soccer leagues, camps and tournaments during the spring, summer and fall, and occasional national and international soccer and rugby tournaments. The subject property is within 1½ miles of two neighborhood elementary schools and a public middle school. The property is approximately two miles from both Boulder Community hospital and Boulder Community Foothills hospital.

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3298 Palo Pkwy, Boulder, CO

3298 PALO PKWY, BOULDER, CO

MAP DATA

Map Number : 08013C0411J

Panel Date : December

18,2012

FIPS Code : 08013

Census Tract : 0127.01

Geo Result : S8 (Most Accurate) -

single valid address match, point

located at a single known address

point candidate (Parcel)

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Copyright © and (P) 1988–2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/Portions © 1990–2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc.

LOCAL AMENITIES MAP

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ANALYSIS OF DATA 25

Surrounding Land Use The property sits in the north-central portion of Boulder, and is nearby to mostly single-family residential properties. This site is immediately adjacent to single-family homes to the south and west, and much of the area further north of the subject is single-family neighborhoods. Immediately north of the subject site is Fourmile Canyon Creek, and directly across the creek is East Palo Park. Previously described Pleasant View Fields Sports Complex sits on the other side of a paved pedestrian path immediately east of the subject property. As noted above, the 3.216-acre subject site consists of one platted parcel and was zoned Suburban Residential (SR) by Boulder County, but it is in the midst of being rezoned to Residential - Mixed 2 (RMX-2) once the annexation and rezoning by the City of Boulder is complete, which is anticipated in February of this year. All of the surrounding properties are compatible with the anticipated multifamily use at the subject.

Proximity to Jobs The subject property is well located in terms of the local employment base. Due to its location within northern Boulder, the property has good access to a large number of employers. There are numerous employment opportunities with businesses located along both the 28th Street and Foothills Parkway corridors. In addition, the City of Boulder as well as the nearby cities of Superior, Lafayette, Louisville and Longmont are home to major public sector and private sector employers including the University of Colorado at Boulder. The subject property is located relatively close to downtown Boulder and has relatively easy access to nearly all of these areas of employment concentration via the Diagonal Highway (aka State Highway 119), U.S. Highway 36, and major thoroughfares in the area. The Boulder MSA experienced generally positive employment trends over much of the last 20 years prior to the worldwide financial crisis in late 2008. Overall job growth during the last 12 months in the Boulder MSA is up 1.0%. Total employment of nearly 180,900 jobs as of 3rd quarter, 2015 is just above the previous high of 180,600 achieved in October of 2014. The unemployment rate in the Boulder MSA fell fairly consistently from mid-2003 until the spring of 2007 when it achieved a low of 2.8%. Economic conditions following this period, including the collapsing housing sector and the international financial crisis, caused unemployment to increase steadily over the next two years until the unemployment rate peaked at 7.8% at the end of the 2nd quarter of 2009. The unemployment rate has edged lower since then but has followed an indirect path. As of the end of the third quarter, 2015, the Boulder area unemployment rate stands at 2.6%, down from 3.3% at year-end 2014, and well below the national average of 5.1%. Unemployment in the Boulder MSA is near its

ANALYSIS OF DATA 26

lowest level since 2000, and the 12-month moving average trend line has been on a downward trajectory since the 2nd half of 2010. Six of the top 10 industry sectors in the Boulder MSA expanded over the past year. The Information sector and the Professional & Business Services sectors fell over the 12 months ending in the third quarter of 2015, Mining, Logging, and Construction and the Manufacturing sectors were unchanged from the previous year. As the county seat, Boulder is host to a large number of government jobs between local, county and state workers as well as the presence of the U.S. Department of Commerce Boulder Labs and other federal installations and offices. Government employment is the largest job sector in the Boulder area, has been growing at a steady clip lately, and was relatively stable during the recent recession. After Government employment, the largest employment sector in the Boulder MSA is Professional & Business Services followed by Trade, Transportation & Utilities. As of third quarter, 2015, Government was the fastest growing job sector over the previous 12 months with 5.7% annual growth. Leisure & Hospitality and Education & Health Services grew at annual rates of 3.6% and 2.6%, respectively, to grab the 2nd and 3rd positions for fastest growing employment sectors. Mining, Logging & Construction, while only the smallest employment sector in the Boulder MSA, has been one of the fastest growing job sectors recently due to oil and gas development in Colorado in general and, more recently, along the Front Range specifically. However, after achieving annual growth rates for this sector that averaged around 5%-10%, growth rates slowed significantly in 2015 due to the drop in gas prices. Current and historical employment trends can be seen in the below graphs:

ANALYSIS OF DATA 27

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Total Jobs vs. Unemployment

Total Non-farm Employment (000s)* Unemployment Rate (Boulder MSA)* 12 Mo. Moving Avg (Unemploy Rate)*

* Not-seasonally adjustedSource: U.S. Bureau of Labor Statistics & RealEstateAnalysis.us

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ANALYSIS OF DATA 28

Marketability While some attributes of the proposed project have yet to be finalized, the marketability of an affordable development at this site should be strong based on locational factors, unit mix, and age/condition/quality. It has a good location near central Boulder on the outskirts of a major commercial/retail area. It is located close to major employers in downtown Boulder, in surrounding cities, and along the Highway 36 corridor. In addition, the subject site is several blocks north of the new Boulder Junction public transportation hub and corresponding development. The subject site is also adjacent to parks, soccer fields and a pedestrian/bike path. The property also has a good mix of one-, two-, and three-bedroom units as well as a combination of flat-style and townhome-style floorplans. Finally, the new construction status of the property along with interior finishes consistent with other BHP properties in the area will be attractive to local renters.

Walk Score & Transit Score As part of CHFA’s market study guidelines, a Walk Score and Transit Score is required as part of the market study. As noted in the 2016 QAP, “Walk Score is the first large-scale, public access walkability index and can be calculated at www.walkscore.com. The website ranks site locations and communities nationwide based on a site’s proximity to job centers, services, parks, medical facilities, schools and other common destinations.” Similarly, “Transit Score is a measure of how well a location is served by public transit and can also be calculated at www.walkscore.com. Transit Score is based on data released in a standard format by public transit agencies. This score is calculated based on a sites proximity to nearby transit routes based on the frequency, type of route (rail, bus, etc.), and distance to the nearest stop on the route.” The scores of both measurements are rated by a whole number between 0-100. Below are the scores for the subject site compared to the same score for the entire city.

Walk Score

Transit Score Average Score category

Palo Park Apts 33 38 36 25-49: Car-dependent – Most errands require a car. 25-49: Some Transit – A few nearby public transportation options.

Boulder, CO 56 48 52 50-69: Somewhat Walkable – Some services within walking distance 25-49: Some Transit – A few nearby public transportation options.

ANALYSIS OF DATA 29

Market Boundaries The subject properties’ market area consists of most of the City of Boulder; however, census tract boundaries were used instead of city limits to be consistent with CHFA 2016 Market Study Guide requirements. This area is a stable, in-fill market due to longstanding growth controls in effect in and around Boulder. The market area that best corresponds with the population and employment base of the subject site includes the following 18 Census Tracts:

Census Tracts 08013012101 08013012202 08013012102 08013012203 08013012103 08013012204 08013012104 08013012300 08013012105 08013012401 08013012603 08013012701 08013012605 08013012705 08013012607 08013012707 08013012608 08013012708

The boundaries are roughly equivalent to Nimbus and Oxford Roads to the north, 9th Street and the foothills to the west, Baseline and Arapahoe Roads to the south, and a combination of Cherryvale Road, 55th, 71st, 73rd, 75th and 95th Streets and Airport Road to the east. A graphic representation of the market area can be reviewed on the Market Boundary Map on the next page.

Palo Park Market Study PMA

May 29, 2015

Made with Esri Business Analyst©2015 Esri www.esri.com/ba 800-447-9778 Try it Now! Page 1 of 1

http://www.esri.com/ba

ANALYSIS OF DATA 31

Market Conditions Per CHFA Market Study Guidelines, the Colorado Division of Housing’s Denver Metro Apartment Vacancy and Rent Survey was referenced for historical rent and vacancy information for the market area. The subject market area boundaries do not match up exactly with any of the predefined market areas in the DMA Vacancy and Rent Survey report; however, a large portion of the “Boulder” submarket is encompassed in the subject market area as defined in this market study, and covers much of the subject market area. Therefore, the Boulder submarket data is used here to give an overview of multifamily market conditions in the market area. It should also be noted that the Boulder submarket does not include the CU campus area, which is included in its own submarket. As of 3rd quarter, 2015, the Boulder submarket has an overall multifamily vacancy rate of 4.3% and a 4.3% vacancy rate in apartment buildings containing 9-50 units. Vacancy and rent by unit type are 4.2% and $1,574 for one-bedroom units, 2.2% and $1,615 for two-bedroom/one-bath units, 5.9% and $2,016 for two-bedroom/two-bath units and 8.0% and $2,467 for three-bedroom units in the Boulder submarket as of 3rd quarter, 2015. Historical multifamily vacancy rates for the Boulder submarket over the last year are as follows:

3Q ‘14 4Q ‘14 1Q ‘15 2Q ‘15 3Q ‘15 Boulder 3.1 5.4 3.8 4.7 4.3

The only source of affordable housing vacancy and rents in major markets in Colorado was the “Colorado Multifamily Affordable Housing Vacancy and Rent Study” researched and authored by Gordon E. Von Stroh, PhD and Ron L. Throupe, Ph.D. of The Daniels College of Business at the University of Denver, and sponsored by Colorado Housing and Finance Authority and the Colorado Division of Housing. Unfortunately, this report was only produced from 2007 to 2011, and the last edition was released for the 1st quarter of 2011. While no on-going survey of Boulder’s affordable housing vacancy rates currently exists, Boulder Housing Partners manages over a dozen affordable projects throughout the City of Boulder, and they have no vacancies at nearly all of their affordable properties. Furthermore, due to the lack of vacancies now and in the recent past at the peer group properties, presented later in this report, it is likely that market-wide vacancy rate for affordable units is likely significantly lower than the overall multifamily vacancy rate in Boulder.

ANALYSIS OF DATA 32

Average rental rates for the Boulder submarket continue to increase rapidly. Over the last year, overall average rents have moved as follows:

3Q ‘14 4Q ‘14 1Q ‘15 2Q ‘15 3Q ‘15 Rent Growth

Boulder $1,388 $1,347 $1,455 $1,505 $1,734 24.9% Historic trends for average apartment rents and vacancy for the City of Boulder (excluding the CU area) are:

BOULDER – EXCEPT UNIVERSITY AREA APARTMENT MARKET

Year Year End Average Rents (1BR1BA – 2BR2BA)

Average Percent Change (%)

Year End Vacancy Rate (%)

2015* $1,574 – 2,016 24.9 4.3 2014 1,149 – 1,963 14.4 5.4 2013 1,083 – 1,638 15.8 3.9 2012 1,001 – 1,349 (2.2) 1.9 2011 1,069 – 1,335 9.4 3.5 2010 943 – 1,255 7.0 3.5 2009 927 – 1,127 (1.5) 5.8 2008 905 – 1,180 2.3 3.0 2007 853 – 1,185 (0.3) 2.0 2006 873 – 1,171 10.1 5.6 2005 784 – 1,073 (3.9) 4.7 2004 841 – 1,091 9.9 9.1 2003 777 – 981 (8.2) 6.9 2002 818 – 1,097 (3.0) 13.0 2001 890 – 1,104 3.2 11.9 2000 829 – 1,104 15.2 1.8 1999 743 – 935 4.0 3.1 1998 715 – 898 5.8 4.6 1997 657 – 867 4.2 4.2 1996 624 – 838 2.1 3.7 1995 613 – 819 5.1 2.1 1994 581 – 782 15.2 2.9 1993 543 – 640 12.5 3.5 1992 484 – 568 11.9 0.8 1991 407 – 533 4.2 1.0 1990 420 – 482 (8.8) 2.5 1989 418 – 571 16.6 5.8 1988 382 – 466 NA 3.9

Source: James Real Estate Services, Inc. Denver Area Apartment Vacancy and Rent Study * Third Quarter 2015

ANALYSIS OF DATA 33

The apartment market in metro Denver improved greatly during the last several years as the economy recovered, generating demand for apartments. The lack of new construction (until recently) also contributed to the tightening market. Following is a synopsis of apartment market conditions as of the end of the 3rd Quarter of 2015, as described in the James Real Estate Services “Apartment Perspective” and including data from the Apartment Association of Metro Denver.

The vacancy rate in the seven-county Denver metro area increased during the 3rd Quarter of 2015 to 5.0%, up from 4.5% at the end of the 2nd Quarter and from 3.9% in the 3rd Quarter of 2014. Vacancy rates were highest in Arapahoe and Denver counties and lowest in Boulder and Broomfield counties.

Net absorption was disappointing during 2012 as many apartment residents took advantage of low residential mortgage interest rates to buy. Increasing employment, however, generates demand for apartments. But, net absorption during 2013 was even lower than 2012, recording only 2,788 units. Absorption rebounded during 2014 to 6,474 units. Over a ten-year period annual net absorption in metro Denver has averaged about 3,400 units so the rebound is a positive indicator (if it continues) in the face of the amount of extensive new development underway. Net absorption for the first nine months of 2015 was measured by the AAMD at 5,111 units.

The tightening apartment market has led to rising rental rates, but that may change later in 2015 and 2016. The average rental rate for the 3rd Quarter of 2015 was $1,292 per month, up 12.8% over the 3rd Quarter of 2014. However, the increase is at least somewhat skewed by the inclusion of new projects being completed and added to the market. Those communities usually have higher average rental rates, thus inflating the average rental rate for the metro area. Thus, rental rates are not measured on a “same store” basis.

Developers, lenders and investors are attracted by Denver’s healthy economy and, until now, strong apartment market. As of the end of the 3rd Quarter of 2015 James Real Estate Services, Inc. counted 18,841 apartment units under construction in metro Denver. In addition, developers have proposed projects containing 21,655 units that may begin construction during the next twelve months.

During 2014 developers started projects containing 10,842 units and completed communities with 8,236 units. In the first nine months of 2015 developers started 6,505 units and brought onto the market projects with 8,127 units.

ANALYSIS OF DATA 34

AVERAGE APARTMENT RENTS

Studio 1-BR 2-BR 2-B 3-BR

Year Vacancy $/Mo $/SF $/Mo $/SF $/Mo $/SF $/Mo $/SF All %

Change 2015 5.0% $1,032 $1.98 $1,149 $1.61 $1,516 $1.42 $1,758 $1.35 $1,291 12.8% 2014 4.7% 914 1.84 1,034 1.47 1,383 1.30 1,635 1.28 1,168 12.2% 2013 5.2% 817 1.62 921 1.30 1,234 1.16 1,437 1.13 1,041 5.6% 2012 4.9% 765 1.52 866 1.22 1,174 1.10 1,374 1.07 986 5.7% 2011 5.4% 695 1.41 822 1.16 1,098 1.03 1295 1.01 932 2.5% 2010 5.5% 656 1.32 795 1.12 1,069 1.00 1,284 1.01 909 3.7% 2009 7.7% 677 1.37 756 1.06 1,036 0.96 1,223 0.95 875 (1.6%) 2008 7.9% 630 1.28 776 1.09 1,056 0.98 1,259 1.04 889 3.3% 2007 6.1% 624 1.28 760 1.08 1,021 0.96 1,200 0.95 860 1.2% 2006 7.0% 624 1.28 739 1.05 1021 0.96 1,163 0.93 850 0.2% 2005 7.9% 561 1.22 735 1.05 1,016 0.96 1,161 0.94 848 3.3% 2004 10.0% 534 1.16 710 1.03 990 0.95 1,134 0.92 821 0.7% 2003 10.9% 532 1.17 706 1.02 915 0.92 1,093 0.91 815 0.1% 2002 10.6% 575 1.22 716 1.06 974 0.91 1,085 0.88 814 (1.0%) 2001 8.7% 559 1.21 720 1.02 972 0.95 1,096 0.89 822 3.7% 2000 4.7% 512 1.14 692 1.04 968 0.94 1,051 0.86 793 8.0% 1999 5.2% 497 1.08 638 0.96 899 0.88 974 0.83 734 5.6% 1998 4.4% 454 1.00 608 0.91 849 0.85 955 0.80 695 6.9% 1997 4.6% 416 0.92 558 0.85 801 0.80 896 0.75 650 7.1% 1996 4.9% 399 0.90 529 0.81 726 0.74 789 0.64 607 5.6% 1995 5.0% 374 0.85 502 0.77 702 0.71 760 0.63 575 6.5% 1994 3.8% 390 0.85 473 0.73 664 0.67 708 0.58 540 7.6% 1993 4.4% 357 0.78 441 0.68 620 0.63 643 0.53 502 6.4% 1992 4.7% 333 0.73 412 0.64 583 0.59 609 0.50 472 9.0% 1991 5.8% 296 0.63 380 0.59 547 0.55 561 0.47 433 6.9% 1990 8.5% 281 0.60 353 0.55 514 0.52 549 0.44 405 3.8% 1989 11.1% 264 0.58 342 0.53 443 0.50 530 0.42 390 (1.5%) 1988 11.3% 261 0.56 349 0.54 450 0.49 533 0.45 396 (2.0%) Source: The Denver Area Apartment Vacancy and Rent Survey/James Real Estate Services, Inc. Note: Average rents do not reflect concessions and specials. Change is based on difference between annual average and latest quarter of the current year. 2015 is for the end of the 3rd Quarter.

ANALYSIS OF DATA 35

METRO DENVER APARTMENT DEVELOPMENT ACTIVITY For the counties of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas and Jefferson

Year Units

Permitted Units Added

Units Absorbed (Net)

Vacancy Rate

2015 2,982 6,163 5,111 5.0% 2014 10,842 4,803 6,474 4.7 2013 10,417 3,743 2,788 5.2 2012 3,240 1,675 3,138 4.9 2011 2,008 1,438 1,536 5.4 2010 1,002 498 6,827 5.5 2009 438 3,791 4,069 7.7 2008 4,413 2,881 (2,421) 7.9 2007 3,015 2,212 4,644 6.1 2006 1,127 738 2,709 7.0 2005 460 2,517 8,123 7.7 2004 2,681 2,548 4,679 10.0

Source: Apartment Association of Metro Denver, Home Builders Association of Metro Denver and James Real Estate Services, Inc. Note. Units added may also include units not previously in the AAMD survey and are not necessarily the same as units completed. Data is through the 3rd Quarter of 2015, except for permits which are through May.

APARTMENT VACANCY RATES AND RENTAL RATES BY COUNTY

3RD QUARTER 2015

County

Vacancy Rate

Economic Vacancy Rate

Average Rental Rate

Adams 4.4% 19.0% $1,207 Arapahoe 5.5 15.5 1,230 Boulder/Broomfield 3.6 13.4 1,504 Denver 5.3 9.8 1,294 Douglas 4.4 12.8 1,478 Jefferson 5.1 13.9 1,269 Metro Denver 5.0% 13.6% $1,291

Source: Apartment Association of Metro Denver Note: Economic Vacancy Rate is defined by the AAMD as combined physical vacancy plus the effects of specials and concessions.

ANALYSIS OF DATA 36

APARTMENT RENTAL RATES AND VACANCY RATES BY YEAR

Year

Year End Average Rental Rate

Year End Vacancy Rate

2014 $1,168 4.7% 2013 1,041 5.2 2012 979 4.7 2011 932 5.4 2010 909 5.5 2009 875 7.7 2008 889 7.9 2007 860 6.1 2006 850 7.0 2005 848 7.7 2004 822 10.0

Source: Apartment Association of Metro Denver

For lists of apartment communities started and completed in the 3rd quarter of 2015 and of those under construction and proposed, see the James Real Estate Services, Inc. Apartment Perspective report at www.jres.com.

ANALYSIS OF DATA 37

Comparability Analysis

Inventory Despite the consistent drive for affordable housing development in the Boulder area, the inventory of affordable LIHTC apartment complexes in the City of Boulder is rather limited. Many of the complexes with affordable units are not exclusively LIHTC developments, and consist of both income-restricted and market rate units in the same project. While the overall inventory of multifamily developments in Boulder covers a wide range of ages, several LIHTC properties are less than 10 years old. The subject market area includes much of the City of Boulder, including the University of Colorado, and extending north to the growth area of northern Boulder. This is an infill market and the affordable inventory is distributed throughout the market area. While much of the market-rate multifamily inventory is comprised of older, smaller complexes distributed throughout the market area, several affordable projects have been developed over the last decade. The affordable “family” tax-credit projects located in and around the market area are listed below along with a notation if they are excluded from the market area analysis.

Name Address City Units

Broadway East Community 3110-3160 Broadway St. Boulder 44 Sec 8 Broadway West Community 3120 Broadway Boulder 26 Fairways Apartments 5600 Arapahoe Avenue Boulder 70 Foothills Community 747 Cherry Ave. Boulder 74 High Mar 4990 Moorhead Avenue Boulder 59 Senior Holiday Neighborhood 4600 Broadway Boulder 49 HUB Apartments 1853 26th Street Boulder 83 Ledges at 29th 2850 29th Street Boulder 61 Lee Hill 1175 Lee Hill Drive Boulder 31 Sec 8 Lumine on 28th 2685 28th Street Boulder 69 Parkside Family Housing 5007 Valmont Rd. Boulder 34 UM Red Oak Park 2637 Valmont Rd Boulder 59 San Juan del Centro Apartments 3100 34th Street Boulder 150 Sec 8 Uptown Broadway 4565 14th St Boulder 32 Vistoso Apartments 4500 Baseline Road Boulder 15 WestView Community 4620 N. Broadway Boulder 34 Woodlands Boulder 2663 Mapleton Boulder 35 Sec 8

Excluded due to: OMA = Outside Market Area; Senior = Senior Housing; Sec 8 = Section 8 Housing; UM = Unit Mix

ANALYSIS OF DATA 38

The comparable affordable LIHTC projects in the market area identified in the table above are broken down by AMI level in the below unit summary table. Projects that were excluded above because they differed substantially from the subject project based on unit mix may be included below. In these cases, such as Parkside Family Housing and Woodlands Boulder, only the unit configurations that directly compete with the subject development (i.e. one-, two- and three-bedroom floorplans) are included in the unit summary table below. The totals from this table are used in the Demand Analysis at the end of this market study report.

Name 30% AMI

40% AMI

50% AMI

60% AMI

Broadway West Community 0 0 26 0 Fairways Apartments 5 0 55 10 Foothills Community 0 29 13 0 Holiday Neighborhood 0 26 23 0 HUB Apartments 0 0 17 0 Ledges at 29th 0 0 0 52 Lumine on 28th 0 0 2 67 Parkside Family Housing 0 0 1 18 Red Oak Park 0 11 44 0 Uptown Broadway 0 4 22 6 Vistoso Apartments 0 0 15 0 WestView Community 0 0 34 0

TOTAL UNITS BY AMI 5 70 252 153

Selection of Comparables There are 17 LIHTC complexes in the market area that could potential compete with the subject. Of these, one complex was excluded because it is marketed for seniors and four complexes were excluded since they comprised exclusively of Section 8 units. Two of these projects, Broadway East and Woodlands, are reportedly not required to be Section 8 complexes, and are not identified as such by CHFA; however, Boulder Housing Partners confirmed that BHP operates them as project-based Section 8 developments. Two other projects, Vistoso Apartments and Fairways Apartments, were determined to lie on the very edge of the market area boundaries, but have been included.

ANALYSIS OF DATA 39

Of the remaining 12 projects, six affordable, tax-credit complexes, including three projects with both affordable LIHTC units and market-rate units, throughout the market area were selected as the most comparable to the subject property based on their design, location, amenities, age and unit mix, and are included here as market comparables. Broadway West is one the three peer group property consisting exclusively of tax-credit units. At 26 units, this is the smallest tax-credit property in this peer group. Built in 2010, Broadway West is managed by Boulder Housing Partners and is in good condition. This property contains one-bedroom/one-bath, two-bedroom/one-bath, two-bedroom/two-bath and three-bedroom/two-bath flat-style units. Each unit contains dishwashers and has access to exterior storage, and some units have patio/balconies. Units do not have microwave ovens or washer-dryer hook-ups. Broadway West’s project amenities are limited to a community laundry room, a playground area, secure building access and underground parking. However, Broadway West is located adjacent to the North Boulder Recreation Center, which provides local residents with a lap pool, a leisure pool with an accessible water slide and ramps, a gymnasium, racquetball courts, dry sauna, weight room and cardio space, classroom and meeting space, dance, yoga and multi-purpose rooms, a state-of-the-art gymnastics center, four lighted tennis courts and one platform tennis court. Currently, this property has two vacant units, and does not maintain a waiting list. Foothills Community is a 74-unit subdivision-style complex in northern Boulder that completed construction in 2001 and is managed by Boulder Housing Partners. Within the development are 42 LIHTC units consisting of duplex, townhome and carriage home units in one-bedroom, two-bedroom/two-bath and three-bedroom/two-bath floor plan configurations. Except for a central laundry room and an on-site management office, Foothills Community has no project amenities, although it is located adjacent to open space as well as a city park with a playground. Foothills Community units have dishwashers and patios, but in-unit washer/dryer hook-ups are only in two- and three-bedroom units. This property currently has no vacant units, and does not maintain a waiting list. WestView is one of two peer group properties located in the growth area of north Boulder. Built in 2008 originally as condominium units, the project is now owned and managed by Boulder Housing Partners. Consisting of 34 one-bedroom, two-bedroom/one-bath and three-bedroom/two-bath units, the property is in good condition. This property has no project amenities to speak of although units have some exterior storage available in the basement and a few garages are available to rent. There is also a main floor community space, and a small retail space in the project houses the NoBo Corner Library (aka the North Boulder Library Annex). Units at WestView include a dishwasher, a refrigerator, stove/oven, balconies/patios, and hook-ups for W/D units. The property currently has no vacant units and no waiting list.

ANALYSIS OF DATA 40

Ledges at 29th (formerly known as 29th Street Apartments) is one of the newest LIHTC properties in the City of Boulder. Built in 2014 and in good condition, it is also one of the largest peer group properties with 61 units. The property has an on-site leasing office with a leasing and management staff. This property has among the least amenities of any competing properties consisting of only a picnic/BBQ area. The unit mix at Ledges consists of 9 studio units, 36 one-bedroom units, and 16 two-bedroom/two-bath units. Units at 29th Street include a dishwasher, full-size W/D units, and patios/balconies for each unit. The property currently has no vacant units and leased up in approximately 90 days of opening. It has a waiting list of approximately 18 potential residents; however, this is a combined list that the management company maintains for all of the affordable projects they manage throughout the Boulder market. HUB Apartments is a 66-unit complex managed by Riverstone, which includes 17 LIHTC units. The affordable units consist of 5 one-bedroom units and 12 two-bedroom/two-bath units. Built in 1993, HUB is the oldest peer group property and is in average condition. Each unit has a dishwasher and patio/balcony area, but no washer/dryer hook-ups. This property has one laundry room per floor, an on-site management office, secure building access, a clubhouse and a swimming pool. HUB Apartments currently has a vacancy rate of 3.6%, but only three market-rate units are vacant and no LIHTC units are vacant. This project currently does not have a waiting list. Uptown Broadway is located in the growth area of north Boulder where much of the recent multifamily development has occurred over the last few years. Built in 2008 and in good condition, the 32 affordable multi-family units, that are located within a larger 116-unit market-rate development, are owned and managed by Thistle Communities. The property has an on-site leasing office with a leasing and management staff. This property has among the most amenities of any competing property including a business center, a fitness center, and a hot tub. Units at Uptown Broadway include a dishwasher, a microwave, balconies/patios, hook-ups for stackable W/D units, and exterior unit storage. This property currently has no vacant affordable units, but does have 4 vacant market-rate one-bedroom floorplans, and does not currently have a waiting list.

ANALYSIS OF DATA 41

Walk Score & Transit Score of Comparables As part of CHFA’s market study guidelines, Walk and Transit Scores for each of the Comparables are required as part of the market study. The explanation and discussion of Walk and Transit Score calculations that appear in the Location Analysis section above apply here as well. Below are the scores for the subject site compared to the same score for the selected comparables as calculated at www.walkscore.com.

Walk Score

Transit Score Average Score category

Palo Park Apartments 33 38 36 25-49: Car-dependent – Most errands require a car.

25-49: Some Transit – A few nearby public transportation options.

Broadway West 63 41 52

50-69: Somewhat Walkable – Some services within walking distance. 25-49: Some Transit – A few nearby public transportation options.

Foothills Community 46 39 43 25-49: Car-dependent – Most errands require a car.

25-49: Some Transit – A few nearby public transportation options.

WestView 67 40 54 50-69: Somewhat Walkable – Some services within walking distance. 25-49: Some Transit – A few nearby public transportation options.

Ledges on 29th 84 50 67 70-89: Very Walkable – Most errands can be accomplished on foot.

50-69: Good Transit – Many nearby public transportation options.

HUB Apts 90 56 73 90-100: Walker’s Paradise – Daily errands do not require a car. 50-69: Good Transit – Many nearby public transportation options.

Uptown Broadway 65 40 53

50-69: Somewhat Walkable – Some services within walking distance. 25-49: Some Transit – A few nearby public transportation options.

Palo Park Apts Market Area Averages

64 43 54 50-69: Somewhat Walkable – Some services within walking distance. 25-49: Some Transit – A few nearby public transportation options.

A location map of these market comparables can be found on the following page, followed by detailed listings of attributes and market data of the comparable properties. A photo of each comparable can be found at Addendum A.

Copyright © and (P) 1988–2012 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/streets/Certain mapping and direction data © 2012 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2012 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. © 2012 by Applied Geographic Solutions. All rights reserved. Portions © Copyright 2012 by Woodall Publications Corp. All rights reserved.

BUILDING RENTAL COMPARISON MAP

0 mi 0.5 1 1.5 2

ANALYSIS OF DATA 43

Comparative Analysis Subject Property Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Comp 6

Name of Project Palo Park Apartments

Broadway West

Foothills Community WestView Ledges on 29th HUB

Apartments Uptown

Broadway

Address 4525 Palo Parkway, Boulder

3120 Broadway, Boulder 747 Cherry Ave., Boulder 4620 Broadway,

Boulder 2810 29th Street,



Boulder

Property Type Garden Garden Garden Garden Garden Garden Garden Unit Type Flats Flats Duplexes/TH/CH Flats Flats Flats Flats Year Built Proposed 2010 2001 2012 2014 1993 2008 # of Income Restricted Units 35 26 42 34 61 17 32 # of Market Rent Units 0 0 32 0 0 66 116 General Condition Proposed Good Average Good Good Average Good

Amenities Utilities A/C Fan Coil Central None No Central Wall units Central Gas Tenant Paid Tenant Paid Landlord Paid Tenant Paid Tenant Paid Landlord Paid Tenant Paid Electric Tenant Paid Tenant Paid Tenant Paid Landlord Paid Tenant Paid Landlord Paid Tenant Paid Heat Type Fan Coil Gas Gas Gas Gas Gas Gas Water Tenant Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Sewer Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Trash Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid Landlord Paid

ANALYSIS OF DATA 44

Subject Property Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Comp 6

Name of Project Palo Park Apartments

Broadway West

Foothills Community WestView Ledges on 29th HUB

Apartments Uptown

Broadway Unit Amenities Balcony/Patio Patios Some Yes Yes Yes Yes Yes Dishwashers Yes Yes Yes Yes Yes Yes Yes Exterior Storage Bike Yes No Basement No No Yes Microwave No No No No No No Yes W/D hook-ups/units Full-size units No 2- & 3-Bdrm Hook-ups Full-size units No Stackable Project Amenities Central laundry room No 1 per Bldg 1 per Bldg No No 1 per Floor No Basketball Court No No No No No No No Clubhouse Yes No No No No Yes No Elevators No Yes No No No No No Business Center No No No No No No Yes Exercise Equipment No Adj Rec Ctr No No No No Yes Garage ($ extra) No Underground No Yes No No Yes Hot tub No Adj Rec Ctr No No No No Yes Swimming Pool No Adj Rec Ctr No No No 1 No Playground Yes Yes No No Picnic/BBQ No No On-site Management Part-time No No No Yes Yes Yes Security system No Secure access No No No Secure access No

ANALYSIS OF DATA 45

Unit Size & Mix

Unit Size (Square Feet) Subject

Property Broadway

West Foothills


HUB Apartments

Uptown Broadway

1 Bedroom Units 750 789 686 747 582 614 789-955-976 2 Bedroom/1 Bath Units 1,000 938 1,032-1,086 2 Bedroom/2 Bath Units 1,000 1,109 969 853 946 1,146-1,206 3 Bedroom/1 Bath Units 3 Bedroom/2 Bath Units 1,250 1,400 1,124 1,061 1,350 4 Bedroom/2 Bath Units Studio Units 454 Unit Mix 1 Bedroom Units 13 18 14 11 36 25 96 Income Restricted Units 13 18 10 11 36 5 16 Market Rent Units 0 0 4 0 0 20 80 2 Bedroom/1 Bath Units 8 1 0 12 0 0 34 Income Restricted Units 8 1 0 12 0 0 16 Market Rent Units 0 0 0 0 0 0 18 2 Bedroom/2 Bath Units 6 5 50 0 16 46 18 Income Restricted Units 6 5 27 0 16 12 0 Market Rent Units 0 0 23 0 0 34 18 3 Bedroom/1 Bath Units 0 0 0 0 0 0 0 Income Restricted Units 0 0 0 0 0 0 0 Market Rent Units 0 0 0 0 0 0 0 3 Bedroom/2 Bath Units 8 2 10 11 0 12 0 Income Restricted Units 8 2 5 11 0 0 0 Market Rent Units 0 0 5 0 0 12 0 4 Bedroom/2 Bath Units 0 0 0 0 0 0 0 Income Restricted Units 0 0 0 0 0 0 0 Market Rent Units 0 0 0 0 0 0 0 Studio Units 0 0 0 0 9 0 0 Income Restricted Units 0 0 0 0 9 0 0 Market Rent Units 0 0 0 0 0 0 0

ANALYSIS OF DATA 46

Rent Comparisons

Rent per Unit Subject

Property Broadway

West Foothills


HUB Apartments

Uptown Broadway

1 Bedroom Units 30% AMI $516 $691 40% AMI $708 $691 50% AMI $899 $877 $877 $846 $953 60% AMI $1,091 $1,019 $992 Market Rent $1,250 $1,490-$1,525 $1,525-$1,825 2 Bedroom/1 Bath Units 30% AMI $620 40% AMI $850 50% AMI $1,080 $1,053 $1,016 60% AMI $1,310 $1,142 Market Rent $2,155-$2,322 2 Bedroom/2 Bath Units 30% AMI $620 40% AMI $850 $830 50% AMI $1,080 $1,053 $1,053 $1,145 60% AMI $1,310 $1,277 $1,342 $1,142 Market Rent $1,600 $2,080-$2,380 $2,155-$2,322 3 Bedroom/2 Bath Units 30% AMI $711 $954 40% AMI $977 $954 50% AMI $1,242 $1,212 $1,212 $1,169 60% AMI $1,508 $1,471 Market Rent $2,150 $2,780-$2,830 Studio Units 30% AMI 40% AMI 50% AMI 60% AMI $1,009 Market Rent All rents are net rents excluding concessions, utilities allowances or market rate utility adjustments.

ANALYSIS OF DATA 47

Rent per SF Subject

Property Broadway

West Foothills


HUB Apartments

Uptown Broadway

1 Bedroom Units 30% AMI $0.69 $1.01 40% AMI $0.94 $1.01 50% AMI $1.20 $1.11 $1.28 $1.13 $1.55 60% AMI $1.45 $1.75 $1.02-$1.26 Market Rent $1.82 $2.43-$2.48 $1.87-$1.93 2 Bedroom/1 Bath Units 30% AMI $0.62 40% AMI $0.85 50% AMI $1.08 $0.95 $1.08 60% AMI $1.31 $1.05-$1.11 Market Rent $2.09-$2.14 2 Bedroom/2 Bath Units 30% AMI $0.62 40% AMI $0.85 $0.86 50% AMI $1.08 $0.95 $1.09 $1.21 60% AMI $1.31 $1.32 $1.57 $0.95-$1.00 Market Rent $1.65 $2.20-$2.52 $1.88-$1.93 3 Bedroom/2 Bath Units 30% AMI $0.57 $0.85 40% AMI $0.78 $0.85 $1.10 50% AMI $0.99 $0.87 $1.08 60% AMI $1.21 $1.31 Market Rent $1.91 $2.06-$2.10 Studio Units 30% AMI 40% AMI 50% AMI 60% AMI $2.22 Market Rent

ANALYSIS OF DATA 48

Vacancies & Wait Lists

Subject

Property Broadway

West Foothills


HUB Apartments

Uptown Broadway

Total Units 35 26 74 34 61 83 148 Vacant Units NA 2 0 0 0 3 4 % Vacant NA 7.7% 0.0% 0.0% 0.0% 3.6% 2.7% Vacancy by Unit Type 1 Bedroom Units NA 1 0 0 0 0 4 2 Bedroom/1 Bath Units NA 0 0 0 0 0 0 2 Bedroom/2 Bath Units NA 1 0 0 0 2 0 3 Bedroom/1.5 Bath Units NA 0 0 0 0 0 0 3 Bedroom/2 Bath Units NA 0 0 0 0 1 0 4 Bedroom/1.5 Bath Units NA 0 0 0 0 0 0 4 Bedroom/2 Bath Units NA 0 0 0 0 0 0 # of Wait List NA No list No list No list 18 No list 18

ANALYSIS OF DATA 49

Absorption Overall, absorption for Boulder County has been strong over the last few years, which has helped to drop apartment vacancies from 5.1% in the 2nd quarter of 2009 to 3.3% at the end of the 3rd quarter, 2014. Vacancies are 0% at nearly all of the subject’s comparable peer group properties; however, strong market-rate apartment construction has caused the vacancy rate to be very volatile over that last 12 months. Apartment absorption in Boulder County totaled 614 units absorbed in 2009, 842 units in 2010, negative net absorption of 13 units in 2011, 385 units in 2012, 3,098 units in 2013, and 279 units in 2014, and 1,875 units through three quarters of 2015. However, nearly 5,400 units were added to the Boulder County market since the end of 2012. So far, absorption is managing to keep up, as evidenced by the 5,252 units of net absorption during the same period. Unfortunately, reliable absorption figures are not available below the County-level; however, a brief study of affordable complexes within the market area that completed construction in the last year is below.

Property City Total Units

Construction Completion

Current Occupancy

Absorption Rate (Units/month)

Ledges at 29th Boulder 61 2014 100% 20.0 Lumine on 28th Boulder 69 2015 100% 60.0

The two most recent workforce/family housing projects to open in Boulder in the last 12-18 months are Ledges at 29th and Lumine on 28th. The Ledges on 29th is a 61-unit project consists of 9 studio units, 36 one-bedroom units, and 16 two-bedroom/two-bath units, with all floorplans at 60% AMI. It is also Comparable No. 4 above. Ledges opened in August of 2014 and leased up in approximately 90 days for an absorption rate of just over 20 units/month. According to a representative of the developer, the two-bedroom units leased the quickest and the studios leased the slowest, likely due to a smaller rent margin between the studios and the larger one-bedroom units. Lumine on 28th received a temporary certificate of occupancy on May 22nd of last year and started occupancy on May 28th. The builder was 90% leased by end of June. At Lumine, 67 one-bedroom and two-bedroom units are at 60% AMI and 2 three-bedroom units are at 50% AMI.

ANALYSIS OF DATA 50

Upcoming Competition Two CHFA-approved 4% LIHTC projects are currently proposed for the Primary Market Area. The first is Eagle’s Nest, a small renovation project similar in size to the subject property, and the other is Residences at Sutherland Park (aka SPARK), which will be new construction. The units are SPARK will target 50% and 60% AMI, and Eagle’s Nest will be exclusively 60% AMI units.

DEMOGRAPHIC DATA 51

DEMOGRAPHIC DATA AND DEMAND ANALYSIS

HISTA 2.2 Summary Data© 2016 All rights reserved Nielsen Claritas

1-Person 2-Person 3-Person 4-Person 5+-PersonHousehold Household Household Household Household Total

$0-10,000 1,738 770 219 59 145 2,931$10,000-20,000 1,145 551 346 286 8 2,336$20,000-30,000 518 549 223 106 91 1,487$30,000-40,000 833 613 162 161 94 1,863$40,000-50,000 251 604 300 38 44 1,237$50,000-60,000 431 477 156 48 23 1,135$60,000-75,000 238 476 274 174 22 1,184

$75,000-100,000 225 505 172 196 65 1,163$100,000-125,000 107 331 256 90 47 831$125,000-150,000 36 219 228 35 15 533$150,000-200,000 227 56 52 39 34 408

$200,000+ 40 35 101 10 62 248

Total 5,789 5,186 2,489 1,242 650 15,356


$0-10,000 275 15 5 13 6 314$10,000-20,000 453 43 6 25 6 533$20,000-30,000 275 62 6 16 5 364$30,000-40,000 242 45 8 15 11 321$40,000-50,000 171 56 7 6 7 247$50,000-60,000 121 35 5 8 6 175$60,000-75,000 153 38 11 14 9 225

$75,000-100,000 89 54 14 8 8 173$100,000-125,000 71 22 15 14 7 129$125,000-150,000 85 21 3 10 9 128$150,000-200,000 59 15 0 7 10 91

$200,000+ 71 80 5 9 6 171

Total 2,065 486 85 145 90 2,871

Aged 55+ YearsYear 2016 Estimates

Renter Households

www.ribbondata.com

Palo Park PMA

Renter HouseholdsAge 15 to 54 YearsYear 2016 Estimates


www.ribbondata.com

Palo Park PMA


$0-10,000 203 11 5 5 4 228$10,000-20,000 340 33 5 6 4 388$20,000-30,000 247 38 6 12 4 307$30,000-40,000 189 39 8 7 5 248$40,000-50,000 157 53 6 4 7 227$50,000-60,000 86 16 5 8 5 120$60,000-75,000 47 10 3 12 9 81

$75,000-100,000 85 49 14 5 7 160$100,000-125,000 47 18 2 10 5 82$125,000-150,000 39 8 1 5 7 60$150,000-200,000 52 10 0 5 9 76

$200,000+ 33 47 4 6 4 94

Total 1,525 332 59 85 70 2,071


$0-10,000 2,013 785 224 72 151 3,245$10,000-20,000 1,598 594 352 311 14 2,869$20,000-30,000 793 611 229 122 96 1,851$30,000-40,000 1,075 658 170 176 105 2,184$40,000-50,000 422 660 307 44 51 1,484$50,000-60,000 552 512 161 56 29 1,310$60,000-75,000 391 514 285 188 31 1,409

$75,000-100,000 314 559 186 204 73 1,336$100,000-125,000 178 353 271 104 54 960$125,000-150,000 121 240 231 45 24 661$150,000-200,000 286 71 52 46 44 499

$200,000+ 111 115 106 19 68 419

Total 7,854 5,672 2,574 1,387 740 18,227

All Age GroupsYear 2016 Estimates

Renter HouseholdsAged 62+ Years

Year 2016 Estimates

Renter Households



$0-10,000 11.3% 5.0% 1.4% 0.4% 0.9% 19.1%$10,000-20,000 7.5% 3.6% 2.3% 1.9% 0.1% 15.2%$20,000-30,000 3.4% 3.6% 1.5% 0.7% 0.6% 9.7%$30,000-40,000 5.4% 4.0% 1.1% 1.0% 0.6% 12.1%$40,000-50,000 1.6% 3.9% 2.0% 0.2% 0.3% 8.1%$50,000-60,000 2.8% 3.1% 1.0% 0.3% 0.1% 7.4%$60,000-75,000 1.5% 3.1% 1.8% 1.1% 0.1% 7.7%

$75,000-100,000 1.5% 3.3% 1.1% 1.3% 0.4% 7.6%$100,000-125,000 0.7% 2.2% 1.7% 0.6% 0.3% 5.4%$125,000-150,000 0.2% 1.4% 1.5% 0.2% 0.1% 3.5%$150,000-200,000 1.5% 0.4% 0.3% 0.3% 0.2% 2.7%

$200,000+ 0.3% 0.2% 0.7% 0.1% 0.4% 1.6%

Total 37.7% 33.8% 16.2% 8.1% 4.2% 100.0%


$0-10,000 9.6% 0.5% 0.2% 0.5% 0.2% 10.9%$10,000-20,000 15.8% 1.5% 0.2% 0.9% 0.2% 18.6%$20,000-30,000 9.6% 2.2% 0.2% 0.6% 0.2% 12.7%$30,000-40,000 8.4% 1.6% 0.3% 0.5% 0.4% 11.2%$40,000-50,000 6.0% 2.0% 0.2% 0.2% 0.2% 8.6%$50,000-60,000 4.2% 1.2% 0.2% 0.3% 0.2% 6.1%$60,000-75,000 5.3% 1.3% 0.4% 0.5% 0.3% 7.8%

$75,000-100,000 3.1% 1.9% 0.5% 0.3% 0.3% 6.0%$100,000-125,000 2.5% 0.8% 0.5% 0.5% 0.2% 4.5%$125,000-150,000 3.0% 0.7% 0.1% 0.3% 0.3% 4.5%$150,000-200,000 2.1% 0.5% 0.0% 0.2% 0.3% 3.2%

$200,000+ 2.5% 2.8% 0.2% 0.3% 0.2% 6.0%

Total 71.9% 16.9% 3.0% 5.1% 3.1% 100.0%

Aged 55+ YearsYear 2016 Estimates

Percent Renter Households

www.ribbondata.com

Palo Park PMA

Percent Renter HouseholdsAge 15 to 54 YearsYear 2016 Estimates


www.ribbondata.com

Palo Park PMA


$0-10,000 9.8% 0.5% 0.2% 0.2% 0.2% 11.0%$10,000-20,000 16.4% 1.6% 0.2% 0.3% 0.2% 18.7%$20,000-30,000 11.9% 1.8% 0.3% 0.6% 0.2% 14.8%$30,000-40,000 9.1% 1.9% 0.4% 0.3% 0.2% 12.0%$40,000-50,000 7.6% 2.6% 0.3% 0.2% 0.3% 11.0%$50,000-60,000 4.2% 0.8% 0.2% 0.4% 0.2% 5.8%$60,000-75,000 2.3% 0.5% 0.1% 0.6% 0.4% 3.9%

$75,000-100,000 4.1% 2.4% 0.7% 0.2% 0.3% 7.7%$100,000-125,000 2.3% 0.9% 0.1% 0.5% 0.2% 4.0%$125,000-150,000 1.9% 0.4% 0.0% 0.2% 0.3% 2.9%$150,000-200,000 2.5% 0.5% 0.0% 0.2% 0.4% 3.7%

$200,000+ 1.6% 2.3% 0.2% 0.3% 0.2% 4.5%

Total 73.6% 16.0% 2.8% 4.1% 3.4% 100.0%


$0-10,000 11.0% 4.3% 1.2% 0.4% 0.8% 17.8%$10,000-20,000 8.8% 3.3% 1.9% 1.7% 0.1% 15.7%$20,000-30,000 4.4% 3.4% 1.3% 0.7% 0.5% 10.2%$30,000-40,000 5.9% 3.6% 0.9% 1.0% 0.6% 12.0%$40,000-50,000 2.3% 3.6% 1.7% 0.2% 0.3% 8.1%$50,000-60,000 3.0% 2.8% 0.9% 0.3% 0.2% 7.2%$60,000-75,000 2.1% 2.8% 1.6% 1.0% 0.2% 7.7%

$75,000-100,000 1.7% 3.1% 1.0% 1.1% 0.4% 7.3%$100,000-125,000 1.0% 1.9% 1.5% 0.6% 0.3% 5.3%$125,000-150,000 0.7% 1.3% 1.3% 0.2% 0.1% 3.6%$150,000-200,000 1.6% 0.4% 0.3% 0.3% 0.2% 2.7%

$200,000+ 0.6% 0.6% 0.6% 0.1% 0.4% 2.3%

Total 43.1% 31.1% 14.1% 7.6% 4.1% 100.0%

All Age GroupsYear 2016 Estimates

Percent Renter HouseholdsAged 62+ Years

Year 2016 Estimates




$0-10,000 1,704 702 199 59 146 2,810$10,000-20,000 1,129 500 321 260 6 2,216$20,000-30,000 577 544 223 112 90 1,546$30,000-40,000 857 563 150 138 100 1,808$40,000-50,000 306 641 323 34 50 1,354$50,000-60,000 470 461 152 44 29 1,156$60,000-75,000 278 503 284 189 21 1,275

$75,000-100,000 267 573 189 245 62 1,336$100,000-125,000 128 405 286 105 49 973$125,000-150,000 50 297 279 48 22 696$150,000-200,000 292 74 74 49 40 529

$200,000+ 80 53 162 11 86 392

Total 6,138 5,316 2,642 1,294 701 16,091


$0-10,000 355 24 5 15 9 408$10,000-20,000 479 52 9 31 7 578$20,000-30,000 319 75 5 15 10 424$30,000-40,000 249 45 19 19 9 341$40,000-50,000 214 69 8 11 9 311$50,000-60,000 138 31 3 9 8 189$60,000-75,000 162 42 16 15 7 242

$75,000-100,000 115 62 22 14 6 219$100,000-125,000 95 26 24 22 5 172$125,000-150,000 109 27 5 8 9 158$150,000-200,000 76 20 5 19 8 128

$200,000+ 102 105 4 11 9 231

Total 2,413 578 125 189 96 3,401

Aged 55+ YearsYear 2021 Projections

Renter Households

www.ribbondata.com

Palo Park PMA

Renter HouseholdsAge 15 to 54 Years

Year 2021 Projections


www.ribbondata.com

Palo Park PMA


$0-10,000 277 19 5 5 8 314$10,000-20,000 374 35 7 11 6 433$20,000-30,000 291 51 5 11 8 366$30,000-40,000 199 36 16 12 7 270$40,000-50,000 193 65 8 8 6 280$50,000-60,000 102 19 3 9 8 141$60,000-75,000 63 18 9 14 6 110

$75,000-100,000 110 57 20 10 5 202$100,000-125,000 66 21 4 18 4 113$125,000-150,000 63 11 3 6 7 90$150,000-200,000 68 14 4 15 5 106

$200,000+ 57 65 3 6 6 137

Total 1,863 411 87 125 76 2,562


$0-10,000 2,059 726 204 74 155 3,218$10,000-20,000 1,608 552 330 291 13 2,794$20,000-30,000 896 619 228 127 100 1,970$30,000-40,000 1,106 608 169 157 109 2,149$40,000-50,000 520 710 331 45 59 1,665$50,000-60,000 608 492 155 53 37 1,345$60,000-75,000 440 545 300 204 28 1,517

$75,000-100,000 382 635 211 259 68 1,555$100,000-125,000 223 431 310 127 54 1,145$125,000-150,000 159 324 284 56 31 854$150,000-200,000 368 94 79 68 48 657

$200,000+ 182 158 166 22 95 623

Total 8,551 5,894 2,767 1,483 797 19,492

All Age GroupsYear 2021 Projections

Renter HouseholdsAged 62+ Years


Renter Households



$0-10,000 10.6% 4.4% 1.2% 0.4% 0.9% 17.5%$10,000-20,000 7.0% 3.1% 2.0% 1.6% 0.0% 13.8%$20,000-30,000 3.6% 3.4% 1.4% 0.7% 0.6% 9.6%$30,000-40,000 5.3% 3.5% 0.9% 0.9% 0.6% 11.2%$40,000-50,000 1.9% 4.0% 2.0% 0.2% 0.3% 8.4%$50,000-60,000 2.9% 2.9% 0.9% 0.3% 0.2% 7.2%$60,000-75,000 1.7% 3.1% 1.8% 1.2% 0.1% 7.9%

$75,000-100,000 1.7% 3.6% 1.2% 1.5% 0.4% 8.3%$100,000-125,000 0.8% 2.5% 1.8% 0.7% 0.3% 6.0%$125,000-150,000 0.3% 1.8% 1.7% 0.3% 0.1% 4.3%$150,000-200,000 1.8% 0.5% 0.5% 0.3% 0.2% 3.3%

$200,000+ 0.5% 0.3% 1.0% 0.1% 0.5% 2.4%

Total 38.1% 33.0% 16.4% 8.0% 4.4% 100.0%


$0-10,000 10.4% 0.7% 0.1% 0.4% 0.3% 12.0%$10,000-20,000 14.1% 1.5% 0.3% 0.9% 0.2% 17.0%$20,000-30,000 9.4% 2.2% 0.1% 0.4% 0.3% 12.5%$30,000-40,000 7.3% 1.3% 0.6% 0.6% 0.3% 10.0%$40,000-50,000 6.3% 2.0% 0.2% 0.3% 0.3% 9.1%$50,000-60,000 4.1% 0.9% 0.1% 0.3% 0.2% 5.6%$60,000-75,000 4.8% 1.2% 0.5% 0.4% 0.2% 7.1%

$75,000-100,000 3.4% 1.8% 0.6% 0.4% 0.2% 6.4%$100,000-125,000 2.8% 0.8% 0.7% 0.6% 0.1% 5.1%$125,000-150,000 3.2% 0.8% 0.1% 0.2% 0.3% 4.6%$150,000-200,000 2.2% 0.6% 0.1% 0.6% 0.2% 3.8%

$200,000+ 3.0% 3.1% 0.1% 0.3% 0.3% 6.8%

Total 70.9% 17.0% 3.7% 5.6% 2.8% 100.0%

Aged 55+ YearsYear 2021 Projections


www.ribbondata.com

Palo Park PMA

Percent Renter HouseholdsAge 15 to 54 Years



www.ribbondata.com

Palo Park PMA


$0-10,000 10.8% 0.7% 0.2% 0.2% 0.3% 12.3%$10,000-20,000 14.6% 1.4% 0.3% 0.4% 0.2% 16.9%$20,000-30,000 11.4% 2.0% 0.2% 0.4% 0.3% 14.3%$30,000-40,000 7.8% 1.4% 0.6% 0.5% 0.3% 10.5%$40,000-50,000 7.5% 2.5% 0.3% 0.3% 0.2% 10.9%$50,000-60,000 4.0% 0.7% 0.1% 0.4% 0.3% 5.5%$60,000-75,000 2.5% 0.7% 0.4% 0.5% 0.2% 4.3%

$75,000-100,000 4.3% 2.2% 0.8% 0.4% 0.2% 7.9%$100,000-125,000 2.6% 0.8% 0.2% 0.7% 0.2% 4.4%$125,000-150,000 2.5% 0.4% 0.1% 0.2% 0.3% 3.5%$150,000-200,000 2.7% 0.5% 0.2% 0.6% 0.2% 4.1%

$200,000+ 2.2% 2.5% 0.1% 0.2% 0.2% 5.3%

Total 72.7% 16.0% 3.4% 4.9% 3.0% 100.0%


$0-10,000 10.6% 3.7% 1.0% 0.4% 0.8% 16.5%$10,000-20,000 8.2% 2.8% 1.7% 1.5% 0.1% 14.3%$20,000-30,000 4.6% 3.2% 1.2% 0.7% 0.5% 10.1%$30,000-40,000 5.7% 3.1% 0.9% 0.8% 0.6% 11.0%$40,000-50,000 2.7% 3.6% 1.7% 0.2% 0.3% 8.5%$50,000-60,000 3.1% 2.5% 0.8% 0.3% 0.2% 6.9%$60,000-75,000 2.3% 2.8% 1.5% 1.0% 0.1% 7.8%

$75,000-100,000 2.0% 3.3% 1.1% 1.3% 0.3% 8.0%$100,000-125,000 1.1% 2.2% 1.6% 0.7% 0.3% 5.9%$125,000-150,000 0.8% 1.7% 1.5% 0.3% 0.2% 4.4%$150,000-200,000 1.9% 0.5% 0.4% 0.3% 0.2% 3.4%

$200,000+ 0.9% 0.8% 0.9% 0.1% 0.5% 3.2%

Total 43.9% 30.2% 14.2% 7.6% 4.1% 100.0%

All Age GroupsYear 2021 Projections

Percent Renter HouseholdsAged 62+ Years



DEMAND ANALYSIS 60

Demand Analysis To determine renter household demand in the market area, the CHFA demand model was used to analyze the data previously presented in the Comparability Analysis section regarding available housing options. In addition to this primary market data, Census tract data was used to determine qualifying renter households and qualifying household demand. Special tabulated 2010 Census data, as developed by HUD and modeled by Ribbon Demographics, including current year forecasts, was analyzed for the market area to determine the income distribution of renters (as shown in the below tables):

Income Intervals by HH TOTAL 1-person 2-persons 3-persons 4-persons 5+ persons Subject Market Area

Total Rental HH 18,227 7,854 5,672 2,574 1,387 740 Less than $9,999 3,245 2,013 785 224 72 151

$10,000 - $19,999 2,869 1,598 594 352 311 14 $20,000 - $29,999 1,851 793 611 229 122 96 $30,000 - $39,999 2,184 1,075 658 170 176 105 $40,000 - $49,999 1,484 422 660 307 44 51 $50,000 - $59,999 1,310 552 512 161 56 29 $60,000 or more 5,284 1,401 1,852 1,131 606 294

Source: Ribbon Demographics/Claritas

Income Intervals by HH TOTAL 1-person 2-persons 3-persons 4-persons 5+ persons Subject Market Area

Total Rental HH 100.0% 43.1% 31.1% 14.1% 7.6% 4.1% Less than $9,999 17.8% 11.0% 4.3% 1.2% 0.4% 0.8%

$10,000 - $19,999 15.7% 8.8% 3.3% 1.9% 1.7% 0.1% $20,000 - $29,999 10.2% 4.4% 3.4% 1.3% 0.7% 0.5% $30,000 - $39,999 12.0% 5.9% 3.6% 0.9% 1.0% 0.6% $40,000 - $49,999 8.1% 2.3% 3.6% 1.7% 0.2% 0.3% $50,000 - $59,999 7.2% 3.0% 2.8% 0.9% 0.3% 0.2% $60,000 or more 29.0% 7.7% 10.2% 6.2% 3.3% 1.6%

Source: Ribbon Demographics/Claritas

DEMAND ANALYSIS 61

Ribbon 30% AMI 40% AMI 50% AMI 60% AMI Total Eligible Ineligible

1 person $16,770 - 20,880 $22,380 - 27,840 $27,960 - 34,800 $33,570 - 41,760

$10,000 - 19,999 1,598 516 0 0 0 516 1,082 $20,000 - 29,999 793 70 433 162 0 665 128 $30,000 - 39,999 1,075 0 0 516 691 1,075 0 $40,000 - 49,999 422 0 0 0 74 74 348

Subtotal 3,888 586 433 678 765 2,330 1,558

2 person $16,770 - 23,880 $22,380 - 31,840 $27,960 - 39,800 $33,570 - 47,760

$10,000 - 19,999 594 192 0 0 0 192 402 $20,000 - 29,999 611 237 466 125 0 611 0 $30,000 - 39,999 658 0 121 645 423 658 0 $40,000 - 49,999 660 0 0 0 512 512 148

Subtotal 2,523 429 587 769 935 1,973 550

3 person $20,130 - 26,850 $26,850 - 35,800 $33,540 - 44,750 $40,260 - 53,700

$10,000 - 19,999 352 0 0 0 0 0 352 $20,000 - 29,999 229 154 72 0 0 226 3 $30,000 - 39,999 170 0 99 110 0 170 0 $40,000 - 49,999 307 0 0 146 299 307 0 $50,000 - 59,999 161 0 0 0 60 60 101

Subtotal 1,219 154 171 256 359 763 456

4 person $23,250 - 29,820 $31,020 - 39,760 $38,760 - 49,700 $46,530 - 59,640

$20,000 - 29,999 122 80 0 0 0 80 42 $30,000 - 39,999 176 0 154 22 0 176 0 $40,000 - 49,999 44 0 0 43 15 44 0 $50,000 - 59,999 56 0 0 0 54 54 2

Subtotal 398 80 154 65 69 354 44

DEMAND ANALYSIS 62

Ribbon 30% AMI 40% AMI 50% AMI 60% AMI Total Eligible Ineligible

5 person $23,250 - 32,220 $31,020 - 42,960 $38,760 - 53,700 $46,530 - 64,440

$20,000 - 29,999 96 65 0 0 0 65 31 $30,000 - 39,999 105 23 94 13 0 105 0 $40,000 - 49,999 51 0 15 51 18 51 0 $50,000 - 59,999 29 0 0 11 29 29 0 $60,000 - 69,999 31 0 0 0 14 14 17

Subtotal 312 88 109 75 60 264 48

Total 8,340 1,337 1,454 1,842 2,189 5,683 2,657 *Rounding may cause variance. From a total 2015 estimated renter household figure of 18,227, an analysis of renter households by income and household size, according to CHFA guidelines, drops this number by 68% to 5,683 eligible renter households. It should be noted, however, that the sum of the AMI level subtotals equal 6,822 households. This discrepancy is created due to the overlapping income bands in the above analysis and is avoidable since aggregate demographics cannot precisely place individual renter households at specific values within each income band. In accordance with CHFA methodology, the AMI income band subtotals are used in the Demand Model below even though these subtotals slightly overestimate total eligible households. Existing units, and any proposed projects, were derived from the primary market research described in Comparability Analysis portion of this report. The total housing demand in the Market Area is presented in the Demand Model below.

DEMAND ANALYSIS 63

30% AMI

40% AMI

50% AMI

60% AMI

Market Units Total

Total Renter HH in Market Area 18,227 Unserved HH based on Size (If Any) = Size-eligible Renter HH 18,227 x Percent Income Qualifying HH in Market Area 7% 8% 10% 12% = Income Qualifying HH In Market Area 1,337 1,454 1,842 2,189 6,822 + In-migration of HH (If Any) 0 0 0 0 = Total Qualifying HH (Demand) 1,337 1,454 1,842 2,189 11,405 6,822 Existing Units 5 70 252 153 480 Capture Rate - Existing 0.4% 4.8% 13.7% 7.0% 7.0% Under Construction/Planned Units Residences at Sutherland Park (aka SPARK) 0 0 36 9 45 Proposed project - Eagles Nest 0 0 0 36 36 Subject Units-Palo Park (Proposed) 5 8 12 10 35 Total Existing & Under Construction Units 10 78 300 208 596 Capture Rate 0.7% 5.4% 16.3% 9.5% 8.7% Demand Less Existing & Proposed Units 1,327 1,376 1,542 1,981 6,226

CONCLUSIONS 64

Recommendations and Conclusions The proposed subject property will be one of more than a dozen affordable family tax-credit developments in the heavily populated Boulder market area. Its location in a quiet, neighborhood-oriented location in north-central Boulder is good, although its access to public transit and close by services is limited as evidenced by its low Walk Score. The subject property is in walking distances of grocery and other retail stores, and restaurants, service outlets, medical and childcare facilities, as well as area schools and parks, can be accessed by bike and/or public transit. Market data supports strong demand across all unit types, as evidenced by the full occupancies at nearly all of the peer group LIHTC units and lack of vacant units at nearly all of the Boulder Housing Partners’ other affordable projects throughout Boulder. Demand for affordable housing in Boulder has always been strong and growth controls have limited the housing options in the area. In addition to strong local demand, it is likely that significant in-migration would occur in this area if more affordable units were available. Many potential residents would like to move to the Boulder area if more housing options, at affordable unit rents, were available to them in this high-priced housing market. While these additional renters that are above and beyond the local PMA population clearly exist, it is difficult to find reliable sources of data to quantify this potential in-migration population. Tentative unit sizes are in line with competing properties in the PMA, and unit mix should be heavily weighted towards one- and two-bedroom units. One-bath configurations in some of the two-bedroom units are a slight competitive disadvantage for the subject property. Although affordable developments often feature only one bathroom in their two-bedroom floor plans, two-bedroom/two-bath floor plan configurations are a little more common in the Boulder market area, and they are more desirable to potential renters. The subject development does benefit from the fact that the developer has already increased the bathroom count in most of the two-bedroom and three-bedroom units to more than one bathroom per unit. The planned community amenities including a leasing office, a clubhouse or community room with kitchen and activity areas, community Wi-Fi, a small playground or play area for neighborhood children, a picnic/BBQ area, and community gardens are limited, although minimal community amenities are not unusual at many affordable complexes, including several of the subject’s comparables. The subject also benefits from the local parks and pedestrian trails in its immediate vicinity. In-unit washer and dryer units at the subject property are an additional plus. This unit amenity is becoming more of a standard with new market-rate multifamily developments, and they are offered in other existing affordable projects in the market area; furthermore, some of the proposed developments are anticipated to include in-unit washer and dryers.

CONCLUSIONS 65

It is also recommended that the proposed project incorporate “green” (i.e. environmentally friendly and/or environmentally sustainable) concepts or initiatives into the final development. CHFA has indicated that environmental sustainability and other energy/resource-conservation-based concepts in terms of a project’s design, construction or operation will play a factor in determining the amount of credits reserved for a project under the Low-Income Housing Tax Credit program each year. Most of Boulder’s LIHTC units are targeted at the 50% AMI level. However, many of the new LIHTC units coming on line in this submarket have been targeted at 60% AMI renters, which has raised the number of 60% AMI units significantly, as well as the corresponding Capture Rate for this sector, although still below the overall capture rate of the 50% AMI units. The remaining demand for units at 60% AMI is still very strong. In fact, the overall residual demand for 60% AMI units remains roughly 25%-50% higher than either the total demand for 30%, 40%, or 50% AMI units even after the new and planned units are accounted for. While a case can be made for targeting lower AMI bands (i.e. 30% and/or 40%), the total number of residual units in the 50% and 60% AMI levels (3,523 total units of demand) is substantially higher than the total number of residual units in the 30% and 40% AMI bands (2,703 total units of demand). Overall, the subject property has a lot going for it. It is well located in an established neighborhood with easy access to stores, services, parks, and trails. It is well designed and will be managed by the biggest affordable management organization, based on total units, in this market. The unit sizes, floorplans and appeal of new construction will attract renters to this complex. The project should be successful due to its location, unit mix, and strong affordable unit demand in this area.

Addendum A Comparable Property Photos

COMPARABLE PROPERTY PHOTOGRAPHS

COMPARABLE #1 – BROADWAY WEST COMPARABLE #2 – FOOTHILLS COMMUNITY


COMPARABLE #3 – WESTVIEW COMPARABLE #4 – LEDGES ON 29TH


COMPARABLE #5 – HUB APARTMENTS COMPARABLE #6 – UPTOWN BROADWAY

Addendum B Qualification of Market Analysts and Company Profile

Qualifications Of

STEPHEN E. ROSS

MBA – California Polytechnic State University College of Business Administration Economics and International Business BA – University of Denver, College of Business Real Estate and Finance

Certified General Appraiser – State of Colorado

Approved Market Analyst – Colorado Housing and Finance Authority

Business Affiliations, Past/Present

SRC Enterprises, Inc. – Denver James Real Estate Services, Inc. - Denver Grubb & Ellis Co. – San Francisco The Meyers Group – Encino, CA Marcus & Millichap – San Francisco/Denver

APPRAISAL AND CONSULTING EXPERIENCE

Property Types

Apartments Group Homes Public Housing Assisted Living Facilities Industrial Buildings Residential Land Athletic Clubs Land Lease Restaurants Auto Sales/Service Centers Night Clubs Retail Churches Office Buildings Sand Mines Commercial Land Office Condos Shopping Centers Condominiums Office/Industrial Flex Student Housing Garden Centers Open Space Warehouses Gravel Pits Water Storage/Lakes

Assignment Types Assignment Purposes Assignment Locations Appraisals Acquisition Colorado Montana Feasibility Studies Disposition Arizona New Jersey Market Studies Eminent Domain California New Mexico Portfolio Analysis Estate Taxes Connecticut New York Rent Studies Financing Florida North Carolina Rehabilitation/Repositioning Foreclosure Georgia Ohio Site Selection/Acquisition Investment Analysis Illinois Oregon Litigation Support Maryland Texas Negotiation Support Minnesota Virginia Missouri Washington

Representative Clients

AEGON USA Federal Aviation Admin (FAA) Pueblo Bank & Trust Company AIMCO FirstBank Pueblo Housing Authority Allison Management Foundation for Senior Living RREEF Funds Boulder County Housing Authority GMAC Commercial Mortgage Rocky Mountain Metro Airport Boulder Housing Partners Grand Junction Housing Authority Rothbart Development Brunswick Bowling & Billiards Great Western Bank Sherman Associates Burgwyn Company Heartland Bank Steele Street Bank & Trust Busboom Group Helena Housing Authority Sterling Ranch CarMax Horizon Design Build Manage SW Development Group CARE Housing Iron Point Partners St. Charles Town Company Colorado Dept. of Transportation Jefferson County Open Space Taco Bell Corporation Colorado Capital Bank Johnson Capital Thistle Communities Comerica Bank Koelbel and Company United Dominion Realty Trust Coors Brewing Company LaSalle Bank University of Denver Dayton Hudson Corp. Liberty Savings Bank Vectra Bank Denver Regional Council of Gov Marcus & Millichap Watt Development Donahue Schriber Mile High Development Wells Fargo Element Communities Monroe Group Windsor Housing Authority Fairfield Residential Planet Automotive Zocalo Development

Qualifications of WILLIAM M. JAMES

MAI - Member of the Appraisal Institute CCIM - Commercial Investment Real Estate Institute MBA - University of Denver, Daniels College of Business Real Estate and Construction Management BA - University of Washington, Foster School of Business Urban Development

Certified General Appraiser - State of Colorado Former Member of the Colorado State Board of Real Estate Appraisers

Licensed Real Estate Broker - State of Colorado

Business Affiliations, Past/Present James Real Estate Services, Inc. - Denver RACO Development Corp. - Englewood Shorett and Riely - Seattle/Anchorage City of Seattle – Planning Commission

Ginther Wycoff Group - Denver Chase and Company - Denver Federal Housing Administration – Denver US Army – Facilities Division – Stuttgart

APPRAISAL AND ADVISORY EXPERIENCE Property Types

Agricultural Land Airport Parking Facilities Aircraft Hangars Animal Hospitals Antenna Towers Apartments Arenas Assisted Living Facilities Athletic Clubs Auto Sales/Service Centers Bank Buildings Bowling Centers Breweries & Brew Pubs Broadcast Facilities Car Washes Casinos Chemical Facilities Condominium Units, Assemblages, Complexes and Conversions Continuing Care Facilities Day Care Centers Community Centers Distribution Warehouses

Dog Day Care Facilities Equestrian Facilities Event Centers Food Processing Facilities Family Entertainment Centers Gasoline Stations Golf Courses/Clubs Gravel Mines Group Homes Hazardous Materials/Conditions Health Clubs Historic Properties Homeless Shelters Hospitals Hotel/Motel HUD Apartments Industrial Kennels Lakes Laboratories Manufacturing Facilities Medical Offices Mobile Home Parks Mortuaries

Movie & Performance Theaters Nurseries Office Buildings and Condominiums Parking Facilities Refrigerated Warehouses Residential Care Facilities Research & Development Restaurants Retail Schools Self Service Storage Shopping Centers Single Family Residences Subdivisions Surgical Centers Truck Terminals Truck Maintenance Facilities University Facilities Urban Land Vehicle Maintenance Facilities Warehouses Wetlands Worship Facilities

Assignment Types Appraisals including Full and Fractional Interests Construction Progress Inspections Feasibility Studies Highest & Best Use Studies Market Studies Project Management Rent Studies Reviews of Appraisals Rezone Consultation Portfolio Analysis Site Selection/Acquisition

Assignment Purposes Acquisition Arbitration Assessment Appeal Disposition Eminent Domain Estate Taxes Financing Foreclosure HUD Programs Investment Analysis Lease Renewal Litigation Support Negotiation Support

Assignment Locations Alaska Arizona Colorado Idaho Kansas Louisiana Michigan New Mexico North Dakota Oklahoma South Dakota Utah Washington Wyoming


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Representative Clients, Past/Present AEGON USA Adams Bank & Trust Adams County School District No. 14 AIMCO Advantage Bank ARCS Commercial Mortgage Co. Affinity Bank. ANB Bank Amerisphere Mortgage Finance LLC AMG National Trust Bank Archon Group AT&T Small Business Lending Corp. Bank Financial Bank of America Bank of the West Bank of Choice Bank One Bankers Bank of the West Bellco Credit Union Berenbaum Weinschienk PC Berkley Bank Brighton Housing Authority Burg Simpson Calumet Savings/Hanover Mortgage Catholic Charities CB Richard Ellis Centura Health Cherry Creek School District Cheyenne Regional Medical Center Chrysler First Business Credit Corp. Church of Jesus Christ of Latter Day Saints City of Arvada City of Aurora City of Brighton City and County of Denver City of Colorado Springs City of Golden City of Greenwood Village City of Lakewood Citywide Banks Collegiate Peaks Bank Colorado Attorney General Colorado Business Bank Colorado Capital Bank Colorado Division of Gaming Colorado Dept. of Transportation Colorado East Bank and Trust Colorado Health Facilities Authority Colorado Housing/Finance Authority Colorado National Bank Colorado Savings Bank Colorado State Bank & Trust Colorado Board of Land Commissioners Comerica Bank Commerce Bank Community First National Bank Compass Bank Coors Brewing Company Coors Distributing Company Davis, Graham and Stubbs

Denver Housing Authority Denver Health Medical Center Denver Public Schools Douglas County Attorney E-470 Highway Authority Englewood Schools Fairfield Residential Federal Deposit Insurance Corp. Federal National Finance Corp. Firestone Tire and Rubber Co. FirstBank First National Banks/First Savings Bank First Western Trust Bank Fitzsimons Redevelopment Authority Ford Leasing Development Co. Front Range Bank GE Capital Corporation GMAC Commercial Mtg. Corp. General American Life Ins. Gorsuch Kirgis LLP Grand Junction Housing Authority Great Western Bank Greystone USA Grubb & Ellis Company Guaranty Bank and Trust Co. Guardian Life Insurance Co. HealthOne Heartland Bank Heller Financial Hope Communities Household International, Inc Huntoon Hastings Inc. InnovAge Jefferson County Open Space Jefferson County Highways & Transportation Johnson Capital Jones Intercable, Inc. JP Morgan Chase Bank Judicial Arbiter Group Key Bank of Colorado Koelbel and Company Kutak Rock LLP LaSalle Bank Liberty Savings Bank Life Insurance Co. of Virginia Mercy Medical Center Merrill Lynch Business Financial Services Metropolitan Life Insurance Co. Metropolitan State College of Denver Mile High Community Loan Fund. Miller Coors Molson Coors Municipal Bond Investment Assurance Corp. National Jewish Health NHP Property Management, Inc. North Valley Bank Northland Financial Company Oakwood Homes Patrician Financial Company Patton Boggs LLP

Piper Capital Management Platte Valley Medical Center PorterCare Hospital Prudential Bache Pueblo Bank and Trust Public Employees Retirement Assoc. Real Estate Research Corp. Red Mortgage Capital LLC Redstone Agency Lending Regional Transportation District Resolution Trust Corporation Ross Management Group Saehan Bank Safeway Stores, Inc. Saint Joseph Hospital Salvation Army Service Corporation International Sinclair Oil Company Southwestern Life Insurance Co. Standard Life Ins. of Portland Steele Street Bank and Trust Taco Bell Corporation Terrix Financial Corporation Thistle Community Housing Trammell Crow Company TransAmerica Realty Services, Inc. TransLending Corporation Transnation Title Insurance Co. Travelers Insurance Company Tri-State Bank Trust for Public Land Universal Lending Corp. Union Bank & Trust Union Colony Bank Union Pacific Railroad University of Denver Urban Land Conservancy US Bank US Department of Agriculture US Department of HUD US Department of Veterans Affairs US Federal Aviation Administration US Foods US General Services Administration US Postal Service US Small Business Administration US West New Vector Group, Inc. Ute Mountain Tribe Valley Bank & Trust Vectra Bank Volunteers of America Wabash Life Insurance Company Washington National Insurance Co. Wells Fargo Bank Western Skies, Inc. Western Pioneer Life Insurance Co. White and Steele WW Grainger Inc. Young Americans Bank Zocalo Community Development


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Accepted as Expert Witness

Superior Court - City of Seattle District Courts - Jefferson County, City & County of Denver, Boulder

County, Arapahoe County, Adams County US Bankruptcy Court - Districts of Colorado and Northern Oklahoma US District Court - Colorado Circuit Court - Florida, Hawaii County Board of Equalization - City and County of Denver, Arapahoe County Board of Assessment Appeals - State of Colorado American Arbitration Association Judicial Arbiter Group

County Board of Equalization Hearing Officer/Arbitrator

City and County of Broomfield City and County of Denver

Douglas County Jefferson County Professional Associations Appraisal Instruction Appraisal Institute Appraisal Institute Member, Board of Directors University of Denver - Adjunct Professor Chair, General Appraiser Council University of Colorado Member, Appraisal Standards Council Colorado Association of Realtors Member – Admissions and Designations Qualifications Committee Chair, Admissions Appeals Board Member, General Admissions Committee Chair, General Experience Subcommittee

Denver Board of Realtors Denver Metropolitan Commercial Association of Realtors Mesa County Association of Realtors Community College of Aurora

Vice Chair, Masters Degree Program Subcommittee

Realtor’s Commercial Industrial Society – Colorado Springs

Member, Regional Ethics and Counseling Panel Director, Colorado Chapter Chair, Education, Colorado Chapter CCIM Institute International Right of Way Association National Association of Realtors Colorado Association of Realtors Denver Metro Commercial Association of Realtors

Published Articles

Colorado Real Estate Journal Valuation Insights and Perspectives

Journal of Property Management

Community Affairs Past and Present

Member, Board of Directors, Regional Transportation District, Denver Metro Member, Board of Directors, Housing Colorado Co-Chair – 16th Street Mall Steering Committee Member – Downtown Denver Partnership Transportation and Development Council

Member, Advisory Board, University of Denver, Franklin L. Burns School of Real Estate Member, Cherry Creek Steering Committee

Member, Citizens Advisory Committee, Central Denver Transportation Study Chair, Transportation Solutions Foundation Board of Directors Member, Citizens Advisory Committee, Cherry Creek Parking Study Director, Cherry Creek Chamber of Commerce Member, Denver Cherry Creek Rotary

President, Denver Cherry Creek Rotary Foundation Board of Trustees

90 Madison Street, Suite 403 R E A L E S T A T E D E C I S I O N S U P P O R T Denver, Colorado 80206-5412

main: 303-388-1100 fax: 303-388-8756

www.jres.com

COMPANY PROFILE James Real Estate Services, Inc., is a diversified real estate advisory firm with a foundation of commercial and residential appraisal, appraisal review, market analysis, brokerage and investment advisory services s in Denver, Colorado since 1982. JRES assists clients with strategic direction and specific decisions for a wide variety of real estate situations. As transportation oriented development and affordable housing have become important segments of all real estate, JRES increasingly advises clients in these areas. As cooperation with the surrounding community becomes more important to real estate decisions JRES advises property owners, governments and community organizations with market and investment based real estate research and analysis. Over the years, James Real Estate Services, Inc. (JRES) has conducted real estate appraisal and consulting projects for a variety of institutional, governmental, developer, and corporate clients along the Colorado Front Range, in mountain resorts, on the western slope and the eastern plains, and in several other states. Appraisal and market study assignments include office buildings, apartment and condominium complexes, shopping centers, hospitality, industrial, mixed use, “green” buildings and special use properties, single-family residences, residential and commercial subdivisions, and vacant land, both urban and rural. Many of these engagements require extensive feasibility analysis of alternative uses and eminent domain analysis and consulting. Advisory services include assessed value appeals and arbitration, mass appraisal consulting, market and feasibility studies, development opportunity research, entitlements consulting and management, development and redevelopment cash flow projections, and development project management. Appraisal and market study purposes include mortgage loan underwriting and foreclosure, transaction support, eminent domain, estate consulting, and litigation support for insurance and other types of dispute resolution including arbitration.

The Principals, Associates, and Affiliates of JRES offer in-depth experience at appraisal, review appraisal, site evaluation and selection, development analysis and implementation, economic and physical due diligence, project management, financing, marketing, transaction negotiation, and asset disposition. Brokerage services are concentrated in the single-family residential market in the Denver metropolitan area. Unusual property types appraised and analyzed include: Residential subdivisions Commercial subdivisions Open space land Mixed use properties Transit oriented developments Chemical distribution facilities Refrigerated food processing facilities Homeless shelters Funeral homes Automotive sales & service centers Truck terminals Bowling centers Aircraft hangars Car washes Breweries Family entertainment centers Event centers Worship facilities Museums Camp/retreat facilities Theatre complexes Health clubs Educational facilities Assisted living facilities Correctional facilities Golf courses Restaurants Hotels Casinos Bank branches Self-storage complexes Executive suites office buildings

Student apartments Medical office buildings

HUD subsidized apartments Hospitals

Mixed use properties Music studios Child care facilities Ballet facilities Animal sanctuaries Equine hospitals Fraternity/sorority houses Pet boarding facilities Self-storage complexes

Together, the Principals and staff of the firm offer a substantial base of diversified real estate appraisal, market analysis and investment consulting experience. From its core appraisal discipline, the firm serves a variety of needs of its clients in a changing real estate market place with a solid foundation of fundamental objectivity and sound analytical techniques, occasionally making use of its affiliation with qualified professionals in complementary areas of expertise. Principals in the firm include:

William M. James, MAI, CCIM President and Director, Valuation Advisory Services Stephen E. Ross Denise Moore

Director, Market Analysis Director, Multifamily Valuation

Ann M. Del Nigro Geoff Hauer Eric Karnes Tammy Summers

Director, Brokerage Services Director, Information Systems Director, Market Research Office Manager

Bill James began his appraisal career in 1973 with the commercial and investment appraisal firm of Shorett and Riely in Seattle, Washington and opened the company's first branch office in Anchorage, Alaska. In Denver since 1976, he earned an MBA degree from the University of Denver in Real Estate and Construction Management in 1979. Over the years, while conducting appraisals and market studies on a wide variety of semi-rural, residential, general and special purpose commercial and investment properties, he has managed rezoning, development and redevelopment projects, and instructed appraisal courses. Bill is a Certified General Appraiser (former member of the Colorado Appraiser Board) and a licensed Real Estate Broker in Colorado. He has been accepted as an expert witness in several jurisdictions and has performed appraisals and consulting assignments on a number of special purpose and narrow market properties, and under unique circumstances. Bill has prepared and taught appraisal courses at the University of Denver, University of Colorado, Community College of Aurora, the Denver Metropolitan Commercial Association of Realtors, and the Colorado Association of Realtors. In the Appraisal Institute, he is or has been Chair of the General Appraiser Council, Admissions Appeals Board and the General Experience Subcommittee, a member of the Board of Directors, Admissions Committee, Regional Ethics and Counseling Panel, Appraisal Standards Council, Master’s Degree Program Subcommittee and a member of the Board of Directors of the Colorado Chapter. In 2008 he was publicly elected to the Board of Directors of the Regional Transportation District in the Denver metro area and in 2012 he was elected to the Board of Directors of Housing Colorado.. Steve Ross has over 20 years of experience in real estate analysis, consulting and appraisal. After earning his Bachelor of Science degree in Real Estate and Finance from the University of Denver and his Masters of Business Administration from Cal Poly, San Luis Obispo, where he emphasized Economics and International Business, Steve began his real estate career as a commercial real estate consultant in 1989 with The Meyers Group in Southern California.

After moving to Grubb & Ellis in 1991, Steve held several positions in the Research Services Division including Regional Research Director for the Pacific Northwest Region and National Research Coordinator. In 1996, he joined Marcus & Millichap, as National Manager of the Research Services Division. Prior to joining James Real Estate Services in 2003, Steve started his own independent real estate consulting practice in 2001 where he provided real estate market analysis, consulting services, and market overviews, evaluations, and projections of office, industrial, retail, multi-family and hospitality markets on MSA, regional and national levels to corporate and institutional clients. Projects completed for pension fund advisors, REITs and major commercial real estate clients include asset/market analyses, acquisition studies, development analyses and rehabilitation/repositioning studies of apartment communities.

As an appraiser and market analyst with JRES, Steve has completed appraisals or market

studies for office buildings, retail and single-tenant triple net lease properties, auto sales and service centers, industrial buildings, mixed-use developments, residential condominiums, public housing, sand and gravel mines, water storage reservoirs and residential and commercial land. Steve is a Certified General Appraiser in Colorado and is approved by the Colorado Housing and Finance Authority as a Low-Income Housing Tax Credit Market Analyst.

Denise Moore began her appraisal career in 1992 at Accredited Appraisers, Inc. as an assistant and then as Operations Manager. In 1994, she moved to James Real Estate Services and began to appraise single-family residences. Since 1996, she has primarily appraised apartment properties and condominium conversions with a growing emphasis on HUD related affordable housing including rent comparability studies and senior housing (assisted living) properties. She has appraised other property types but specializes in multifamily properties. Denise is a Certified General Appraiser in Colorado. Ann Del Nigro began her real estate career with a major developer in the late 1980s and joined James Real Estate Services as office manager in 1988. Ann specializes in single-family residential brokerage and is a certified short sales and foreclosure resource in Colorado. Ann also conducts and manages residential inspections for FHA home improvement loans, and researches market data and conducts competitive market analyses for residential lenders. Ann is a licensed Real Estate Broker in Colorado. Geoff Hauer has been involved in appraisal related business activities since 1999, specializing in niche services for brokers in the Denver area. Geoff joined James Real Estate Services, Inc. in 2001 as Director of Information Systems and retains that title in an outside consulting capacity. He maintains the JRES computer network, consults on IT related projects for the firm and provides strategic vision regarding the application of technology at JRES. Geoff earned a Masters Degree in Information Technology from the University of Denver, Daniels College of Business in early 2002. Geoff is a Certified General Appraiser and a Licensed Real Estate Broker in Colorado.

Eric Karnes has researched and analyzed apartment, commercial, industrial and residential real estate markets since 1970. After developing, managing and selling Karnes Research Company, in Charlotte and Raleigh, North Carolina, Eric relocated to the Denver area and joined James Real Estate Services in 2000 and later retired. After rejoining JRES, Eric now maintains the JRES library of real estate market information, prepares the Real Estate Perspective and Apartment Perspective email newsletters, edits the Apartment Perspective blog and contributes to the Real Estate and Transportation Linked in Group. He also consults for several national development and investment companies.

Associate Appraisers at JRES include Maureen Holton and Jeff McGhie. With their qualified assistance, the Principals at the firm provide timely and accurate services and analysis to clients, relying on a wide variety of outside resources and an extensive in-house market data base. Among outside resources are Affiliates with whom JRES consults in assignments that require their expertise. Together, these affiliates and JRES have formed an alliance of independent consulting professionals, integrating complementary specialties to provide solutions for a wide variety of real estate situations. These affiliates include: Kent Bagley Bagley Development Consultants Entitlements and Land Planning

Richard E. Erickson Due Diligence Advisors Technical Inspection and

Hazardous Materials/Conditions

Alec Garbini CM2, Inc. Development Consulting and Management

Andrew M. Kenney, AIA, NCARB Kenney Architects, P.C. Architecture

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