Pier 70 Feasibility Analysis

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					Final Report




Pier 70 Feasibility Analysis




Prepared for:

Port of San Francisco




Prepared by:

Economic & Planning Systems, Inc.
ROMA Design Group




January 2010




EPS #17007
Table of Contents

1.   EXECUTIVE SUMMARY ............................................................................................ 1

     Introduction ............................................................................................................. 1

     Financial Analysis Structure........................................................................................ 1

     Development Program ............................................................................................... 3

     Summary of Results and Key Findings ......................................................................... 3

     Summary of Findings ................................................................................................ 7

2.   PURPOSE AND METHODOLOGY ................................................................................... 9

     Purpose and Limitations............................................................................................. 9

     Evaluation Methodology ............................................................................................. 9

3.   LAND USE PROGRAM ........................................................................................... 13

     Uses Programmed................................................................................................... 13

     Other Uses Considered ............................................................................................ 15

4.   REVENUES ....................................................................................................... 17

     Real Estate Revenues .............................................................................................. 17

     Public Financing Sources .......................................................................................... 20

     Private Capital Investment ....................................................................................... 23

5.   COSTS............................................................................................................ 41

     Sitework and Waterfront Improvements .................................................................... 41

     Rehabilitation and Adaptive Reuse ............................................................................ 42

     Ongoing Costs ........................................................................................................ 43

     Costs Excluded from Pier 70 Feasibility Analysis.......................................................... 43

6.   FEASIBILITY RESULTS .......................................................................................... 55

     Financial Feasibility Analysis ..................................................................................... 55

     Summary of Investments and Returns....................................................................... 55

7.   SENSITIVITY TESTS ............................................................................................. 63

     Sensitivities Tested ................................................................................................. 63

     Results of Tests ...................................................................................................... 64

     Appendix A:           Additional Support Tables

     Appendix B:           Sensitivity Results
List of Tables and Figures


Table 1.      Project Description Summary..............................................................................3


Table 2.      Pier 70 Project Development Costs ......................................................................4


Table 3.      Pier 70 Project Revenues ...................................................................................5


Table 4.      Cost and Revenue Comparison............................................................................6


Table 5. Description of Uses Included in Feasibility Analysis ................................................. 13


Table 6.      Project Description for 50 Acres ........................................................................ 16


Table 7.      Summary of Vertical Pro Forma Results ............................................................. 19


Table 8.      Summary of Rehabilitated Building Pro Forma Factors ......................................... 19


Table 9.      Adaptive Reuse: Space by Type/Lease Rates ..................................................... 24


Table 10. Phasing Assumptions ....................................................................................... 25


Table 11. Infrastructure Financing District Bond and Debt Service Calculations ..................... 31


Table 12. Mello-Roos CFD Bond Debt Service Calculation ................................................... 34


Table 13. New Payroll Tax Calculation.............................................................................. 37


Table 14. Proposition D Revenues ................................................................................... 40


Table 15. Adaptive Reuse Pro Formas .............................................................................. 45


Table 16. Rehabilitated Buildings Cash Flow ..................................................................... 51


Table 17. Sources and Uses Table ................................................................................... 57


Table 18. Development Cash Flow ................................................................................... 58


Table 19. Sensitivity Descriptions .................................................................................... 63


Table 20. Sensitivity Test Results .................................................................................... 66


Figure 1.     Illustrative Development Plan—Preferred Master Plan, Pier 70 ................................8
1.      EXECUTIVE SUMMARY


Introduction

Pier 70 is an industrial brownfields development opportunity situated along San Francisco’s
renowned waterfront. The site comprises 65 acres located along the City’s Central Waterfront
just south of Mission Bay, bounded by Mariposa Street to the north, Illinois Street to the west,
22nd Street to the south and, to the east, San Francisco Bay. It is home to an unparalleled
collection of historic, maritime industrial buildings as well as the largest, non-naval ship repair
facility on the West Coast—all of the historic buildings are in need of significant investments to
mitigate and repair deterioration. The Port of San Francisco (Port), as the site owner, retained a
team of consultants to conduct technical analyses related to historic structures, environmental
conditions, urban design, and market and financial feasibility analysis. The results of the
technical work guided the preparation of a Preferred Master Plan for the site. This Report is one
of several studies that support the plan (which has been drafted concurrently with this Report).

The Port retained Economic & Planning Systems, Inc. (EPS) to lead the Preferred Master Plan
efforts and to conduct financial feasibility testing during the preparation of the document.
Pier 70 presents unique development opportunities and challenging financial requirements.
Although the site includes a significant amount of land suitable for revenue-generating new
development, the costs associated with rehabilitation of historic structures, new infrastructure,
environmental remediation, and open space development will require the coordination of
investments from both public and private entities to achieve the primary goals of the project—
creation of a mixed-use waterfront district, historic rehabilitation, open space, and enhanced
public waterfront access.

EPS conducted financial feasibility analysis throughout the preparation of the Preferred Master
Plan, testing various land use densities and use-types to shape the ultimate Plan. This Report
details EPS’s key findings, assumptions, and information sources related to the feasibility
analysis of the Pier 70 site. The actual project cash flow will depend on the timing, use, and
extent of public financing options, the timing and actual costs of site development investments,
and the rate of absorption and achievable values of new development and rehabilitated buildings.


Financial Analysis Structure
EPS prepared a financial model for the Pier 70 project that arrayed project costs and revenues
into an annual cash flow for the development entity for a 30-year period. The model excludes
the 15-acre BAE shipyard including its buildings and BAE’s lease payments to the Port. The
financial analysis is similar to a base reuse or large-scale redevelopment project financial model.
The financial model assumes that the Port will continue to own the land and enter into a long-
term ground lease with a single development entity. A single developer for the site is an
analytical assumption; the Port may lease the site in a difference manner. Consistent with




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language contained in 2008 Proposition D,1 the model assumes that the Port will receive rent
from the Pier 70 developer equivalent to the current interim income from the site, about $3
million per year.

In the cash flow model, the developer would undertake the “horizontal” development for the 50-
acre site: infrastructure, site preparation, park and open space and pier/wharf projects. The
developer would also rehabilitate the historic buildings and build the parking structures required
on the site. As modeled, rather than constructing new buildings—the “vertical” development, the
development entity would enter into land leases with developers or users for building sites. The
developer and/or its subtenants, not the Port, would bear the capital costs of implementing the
Plan.

The overall financial flows to the development entity modeled are:

•   Rent from tenants of rehabilitated historic buildings and interim rent from existing tenants in
    the early years;

•   Ground rent from the new building sites;

•   Receipt of public finance funds as they are available to pay for allowed public uses;

•   Parking income from structured parking; and

•   Debt and investment from the private sector as required.


The financial analysis tests whether the public financing and expected real estate revenues are
sufficient to attract the private sector investment needed for the Plan to succeed, but does not
imply a preferred financing structure. A base case and a set of sensitivity analyses were
prepared to evaluate Pier 70‘s financial feasibility.

The development costs included in the financial feasibility analysis include site preparation,
environmental remediation, infrastructure (new streets and utilities), parks, pier and wharf
improvements, parking improvements and historic rehabilitation. Cost estimates reflect a
planning level of detail for the infrastructure, parks, remediation and other site costs. The
historic building costs were developed with the benefit of field visits and a conceptual reuse
program informed by historic architects, structural engineers hazardous materials experts and
cost estimators. All of the capital cost estimates include a factor for soft costs including
planning, entitlement and contingency. Also included are two ongoing costs to the development
entity: base rent to the Port and environmental remediation monitoring.




1 Proposition D is a measure passed by San Francisco voters in November 2008, amending the City
Charter (adding section B7.310) to allow the Port to utilize a portion of payroll tax and transient
occupancy tax revenues collected from Pier 70 employers and hotel guests (if any) for specified
investments at Pier 70. The full text of this charter section is an appendix of the Preferred Master
Plan.




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Parking is expected to be distributed throughout the site. Parking revenues are not expected to
be sufficient to fund structured parking. The financial model reflects parking costs in two ways:
a portion is included in the development pro forma for new and rehabilitated buildings and
parking structures are a development cost.


Development Program
The Pier 70 Preferred Master Plan contains a framework for development of 50 acres of the site,
excluding the 15-acre ship repair facility. The Plan includes more than 700,000 square feet of
historic, rehabilitated building space, 3.09 million square feet of new development, and 22.6
acres of parks and open space, including a 7- and a 2-acre waterfront parks. Table 1 details
this project description. Figure 1 illustrates the site plan included in the Preferred Master Plan
document. The site plan demonstrates one approach to implementing the parameters contained
in the Preferred Master Plan.

Table 1. Project Description Summary

Item                                                        Total (Yrs 0-20)


Rehabilitated Buildings (sq ft.)                                       721,569
New Development (sq.ft.)                                             3,097,079
 Total (sq.ft.)                                                      3,818,648

Demolished Buildings (sq.ft.)                                           172,709

Parking Spaces                                                               2,943
 Parking Ratio (spaces per 1,000 bldg. sq.ft.) [1]                            1.03

Parks and Open Space (acres)                                                 22.60

[1] The ratio is slightly above 1.0 space per 1,000 because of the higher
parking ratio afforded the medical land use.


Summary of Results and Key Findings

Results

The financial feasibility analysis evaluates the capital flow from the perspective of a master
development entity that would prepare the site for new development (including environmental
remediation and new infrastructure), complete rehabilitation of historic resources, and provide
public amenities such as parks and open space. The revenues generated by these investments
include historic building lease revenues, ground lease revenues (for new development pads), and
available public financing sources such as federal historic tax credits, Infrastructure Financing
District (IFD) bond, Mello-Roos Community Facilities District (CFD) bond, San Francisco 2008
Proposition D revenue, and San Francisco 2008 Proposition A Park Bond. The cash flow analysis
results in two financial measures, both on an unlevered basis: (1) internal rate of return (IRR)
and (2) cash flow net present value (NPV). Because potential private partners for the Port will
each have unique preferences and mechanisms for establishing private financing for a project



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like Pier 70, no assumptions on private financing are included nor has analysis been done to
create a levered cash flow.

Development Costs
Table 2 reports costs used in the financial feasibility analysis totaled over a 30 year time period
without including inflation (2009 dollar value). The largest cost item, historic rehabilitation, is
shown before the application of federal tax credits.

Table 2. Pier 70 Project Development Costs

Item                                                30-year Total
                                               (thousands, 2009$)

Capital Costs
Historic Building Rehabilitation                          $355,000
Piers/Wharfs                                               $60,000
Infrastructure and Site Preparation                        $70,000
Structured Parking                                         $30,000
Parks/Open Space                                           $30,000
Site Remediation                                           $20,000
  Subtotal                                                $565,000

Ongoing Costs - over 30 years
Base Rent to Port                                          $85,000
Remediation Monitoring                                      $5,000
 Subtotal                                                  $90,000


Total Costs                                             $655,000

Note: All capital costs include a 29 percent factor to cover planning,
entitlement, and contingency. Rehabilitation costs include asbestos
and lead paint abatement. Structured parking costs are adjusted
for net parking revenues. Because of the planning level nature of
these costs projections, estimates are shown to the nearest ten
million.


Project Revenues
Table 3 summarizes the revenues from the project. The public financing sources available to
the project are discussed above. The financial feasibility model estimated the public funding
resources, based on the development program concept in the Preferred Master Plan,
assumptions about timing, land and property values, and mix of users. Property tax projections
assume that possessory interest tax (the property tax equivalent) is assessed on rehabilitated
and new buildings.

Payroll tax projections factor in existing City payroll tax incentives for biotech and clean tech
uses. If additional future users of Pier 70 are exempt from property or payroll taxes -- e.g.,
government or certain nonprofit users – assessment district, IFD revenue and Proposition D
revenues could be reduced. Tax-exempt users will be required to pay an equivalent share of
infrastructure and other costs to support Pier 70 public benefits and infrastructure.




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Table 3. Pier 70 Project Revenues

Item                                                             30-year Total
                                                            (thousands, 2009$)
Development Revenue
Ground Lease - New Development                                          $220,000
Historic Building Lease                                                 $260,000
Interim Lease Revenue                                                    $20,000
  Subtotal                                                              $500,000

Public Financing
Park Bond Proceeds                                                       $10,000
Proposition D Bond Proceeds                                              $40,000
Land-Secured Bond Proceeds (Mello-Roos)                                  $80,000
Infrastructure Financing District (IFD) Proceeds                        $110,000
Historic Tax Credit                                                      $70,000
  Subtotal                                                              $310,000


Revenue Total                                                         $810,000

Note: Because of the planning level nature of the revenue project, estimates are
shown to the nearest ten million and exclude inflation. IFD revenues reflect
receipt of 65 percent of the growth in property tax revenues.


New development and historic building rehabilitation projects will pay impact fees to support
transportation improvements, affordable housing and child care facilities. These fees total about
$70 million for the planned development program. These fees are included in the soft costs in
the financial model.

Ground lease revenue from new development is based on the land value resulting from building
feasibility analysis for each land use category. These ground lease revenues were adjusted
downward to reflect the impact of CFD financing which imposes a special tax on new
development sites. Lease revenue estimates for rehabilitated buildings were based on
conceptual use programs for the various historic spaces and market rate rents.

Most project costs will occur periodically during the project timeline. In contrast, most revenues
will be realized on an ongoing basis (e.g., ground lease and historic building lease revenues). In
order to compare costs with revenues, revenues are shown here in constant 2009 dollars
summed over 30 years.

Cost and Revenue Comparison
Development of Pier 70 will require a substantial outlay of capital. Including all costs and
contingencies associated with preparing the land for new development and rehabilitating historic
buildings, expenditures total $655 million, in constant 2009 dollars. Over a 30-year horizon, the
development entity receives $810 million in revenues, but the costs of the project occur far
earlier in time than the revenues generated. In particular, in the first five years, key 20th Street
historic buildings (101, 102, 104, and 113/114) are projected to be rehabilitated, requiring an
investment of $80 million, after adjustments for historic tax credits. A lender or investor must
advance funds to move the project forward; these funds must later be returned with a risk-



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appropriate level of interest. The cash flow shows a total of $165 million of private capital
invested before the development entity realizes a return on that investment.

The financial cash flow includes all of the public financing sources secured to date and evaluates
the “internal rate of return” (IRR) realized by the development entity. As presented, the project
reflects an IRR of 10.2 percent. Real estate development projects of this complexity and risk
generally require an IRR of 15 percent or more, reflecting the market returns required on a mix
of private debt and investor equity.

This “feasibility gap” is the difference between the net present value (NPV) of the costs and
revenues summarized over time, reflecting the risk adjusted, time-value of money. An NPV
discount rate of 15 percent (reflecting a blend of private sector debt and equity) is used here.
Because most of the revenues accrue after the development costs, this illustrative cash flow
analysis demonstrates a feasibility gap of $46 million on a NPV basis. See Table 4 for the
revenue and cost comparison on an NPV basis.

The $46 million feasibility gap indicates further refinement of the Pier 70 financial structure is
required. Sensitivity testing demonstrates several pathways to a feasible project. Access to
lower cost financing mechanisms, additional IFD revenues from State share of tax increment ,
and tuning the timing and magnitude of costs incurred will be the most important factors in
closing the feasibility gap. The Port anticipates that real estate developers can bring additional
insights into refining the project land use program, cost estimates and financing plan to meet
market demands and assist in finding the best users for historic buildings, while meeting the Plan
goals. Concerted efforts by the Port, its constituents and its partners to access additional
funding sources and achieve additional value from the site will be needed to realize a successful
project.

Table 4. Cost and Revenue Comparison

Item                                                                      NPV (at 15%)
                                                                            (thousands)

Revenues
Real Estate Revenue                                                                   $99,000
Public Financing                                                                      $94,000
Historic Tax Credits                                                                  $30,000
 Subtotal                                                                            $223,000

Costs
Historic Building Rehabilitation                                                     $150,000
Infrastructure and Parking Structures                                                 $52,000
Remediation                                                                           $16,000
Parks                                                                                 $16,000
Rent to Port                                                                          $25,000
Piers/Wharfs                                                                          $10,000
  Subtotal                                                                           $269,000

Net Result                                                                            ($46,000)
IRR                                                                                      10.2%

Note: A detailed version of this information is provided in Table 17.


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Summary of Findings

The analysis demonstrates that development of the Preferred Master Plan may be feasible;
however, its success depends upon significant private investment and additional financial
resources beyond the “base case” assumptions, as described below.

1. The feasibility of development at Pier 70 requires a significant level of private
   investment.
With $565 million in capital costs to prepare the site for development, rehabilitate historic
resources, and provide park and open space amenities, the revitalization of Pier 70 will require
that the Port partner with a private entity with a proven track record for complex and successful
redevelopment projects as well as financial resources sufficient to bring the long-term vision for
Pier 70 to market.

2. In addition, funding beyond that included in the “base case” will be needed to
   generate a feasible project.
As shown in Table 4, the “base case” land use scenario results in a project IRR of 10.2 percent
and has an NPV of negative $46 million calculated with a 15 percent discount rate. Several
potential funding opportunities have not been included in the “base case” analysis such as
additional IFD revenue, funds from other local revenues, and state, philanthropic, and/or federal
grants. The results of the “base case” analysis indicate that additional funding will need to be
secured in order to create the conditions which will attract private investments.

3. The infusion of one or more additional funding sources improves the project’s
   financial feasibility significantly.
Several of the sensitivities tested evaluate the feasibility effects of additional outside funding
sources. The potential sources of outside funding tested include: the State’s portion of IFD
funding (allows the project to capture the State’s share of site property tax increment), grants
and philanthropic sources, and additional public funding from another source. These funding
sources increase the project’s NPV significantly, with a combination of the State’s share plus
additional outside grants resulting in a positive NPV for the Project.

4. Measures which delay expenditures without affecting revenue generation will
   further improve project feasibility.
The base case cash flow assumes that the infrastructure costs are substantially front-loaded in
the project with 100 percent installed by year 10. A more detailed project plan and cash flow
may reveal potential cost efficiencies which minimize or delay expenditures. One alternative
tests this potential efficiency by delaying infrastructure and environmental remediation costs.2
Combining additional public funding and enhanced IFD revenues with a delay in expenditures
results in a project NPV of positive $20.0 million, achieving project feasibility.



2 It is important to note that this analysis did not test the physical or operational constraints
associated with the timing and phasing of infrastructure or environmental remediation costs. The
analysis only speaks to the financial implications of delaying investments. To the extent that
spreading out these costs through time is not physically or practically possible, this alternative could
not be implemented.



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                                           Figure 1. Illustrative Development Plan—Preferred Master Plan, Pier 70


           VERY SIGNIFICANT RESOURCE
           SIGNIFICANT RESOURCE
           CONTEXT RESOURCE
           OPEN SPACE
           SHIP REPAIR                                                               CRANE COVE
                                                                                        PARK
           BUILDING REMOVED                                      1A
           NEW BUILDING PADS


                                                                 1B
    This diagram indicates potential sites for
    the general placement of buildings within
    each of the blocks. These building sites are
    not to be construed as the actual shape of
    future buildings, but rather as a general
                                                                 2A
    envelope for new buildings. The building                                                      SHIP REPAIR
                                                                       2B           2C
    sites were developed in consideration of
    the size and depth of building floorplates
    for potential new uses as well as in consid-
8




    eration of historic relationships such as the
    slipways and the objectives for creating                      3A                                              6A
    visual and pedestrian linkages and open
    space relationships. Variations within                             3B                                         6B
    these building sites is encouraged to                                                                  5A
    create a finer grain scale and pattern that                                                                   6C
    provides the appropriate context for the                                IRISH            5B
                                                                             HILL                                 6D              SLIPWAYS PARK
    historic building and the district. Varia-
    tions in the building sites which achieve
                                                                                             5C                   6E
    the desired density can also be considered
    if they comply with the historic district and
                                                                                                     7A           8A
    other goals of the Plan.                                                                                                                                     N
                                                                                                                                          0   100   200   300’




                                                    New Building Sites



                                                                                                                PIER 70 PREFERRED MASTER PLAN                    51
2.      PURPOSE AND METHODOLOGY


Purpose and Limitations

The Preferred Master Plan provides a structure for development of Pier 70 that defines the
elements of the Historic District, retained ship repair activity, new waterfront parks, and the
envelope of supportable new development on the site. The Preferred Master Plan establishes a
flexible development program. Phasing of improvements will need to be adaptable to changing
market conditions and specific development and tenanting opportunities.

The purpose of including financial feasibility analyses throughout the drafting of the Pier 70
Preferred Master Plan is to ensure that the ultimate Plan reflects a development program which
could achieve feasibility. To that end, feasibility analysis has been an integrated part of the
master plan effort, helping to shape the direction of the Plan from the early stages through the
development of the preferred land use concept.

Because feasibility testing relies upon estimates of market values and cost estimates, it reflects a
snapshot of real estate economics at the time of the analysis. Though every effort has been
taken to employ conservative estimates which avoid inflating the feasibility of the Plan, a
positive, feasible result does not ensure success at Pier 70. Achieving the Pier 70 Master Plan,
for any combination of land uses, will require a partnership with the private sector and a
significant level of private investment well in advance of financial returns being realized.


Evaluation Methodology
The feasibility analysis has been completed assuming a master developer entity would prepare
the 50-acre site for new development and manage the rehabilitation of all historic resources.
The Master Developer framework was used for analytic purposes – it does not indicate a
preferred transaction structure. (Note that the feasibility analysis does not include the ship
repair operation.) Costs such as planning, entitlement, environmental remediation,
infrastructure replacement, parks, and historic rehabilitation are compared with revenues
anticipated from ground leases for new development and building leases for the rehabilitated
building space and available public funding sources. The Preferred Master Plan provides
flexibility in the mix of uses which may be included in newly development building space and
rehabilitated buildings. In order to project revenues, this analysis assumed a specific mix of
uses with sensitivity analysis to consider additional uses.

These revenues and costs are arrayed in an annual cash flow to determine the net present value
of revenues and investments and the project’s internal rate of return. Various land use
programs—in terms of intensities and uses—were tested in this manner. The program contained
in the Preferred Master Plan reflects a result which meets the Port’s key goals for Pier 70—
historic preservation, open space and shoreline access, and maintenance of the working
shipyard. The feasibility analysis considers the viability of this development program to attract
private investment.




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The evaluation methodology includes known costs and revenues expected to be associated with
Pier 70 development, as described in the Preferred Master Plan. These costs and revenues are
all shown to be borne by and accrue to a master developer. In reality, the Port may make early
investments in the property, as funds are available for specific purposes like historic building
stabilization or environmental remediation.


Real Estate Revenues

Revenues are expected to accrue to the master developer from: (1) leases of existing,
rehabilitated building space and (2) lease revenue for land at Pier 70 on which new development
will be constructed.3 The base case analysis assumes ground lease revenues instead of land
sales, reflecting the Port’s retention of site ownership. To estimate the achievable lease
revenues for rehabilitated building space and for developable land, the analysis employed two
estimating techniques:

•   Rehabilitated building space rent. Adaptive reuse concepts have been developed by the
    Planning Team for buildings intended for rehabilitation under the Preferred Master Plan. The
    concepts include estimated leasable square feet, use, (e.g., cultural/institutional, office,
    retail, industrial, etc.) and market rents. Using market rents for each use, revenues from the
    rehabbed buildings are estimated.

•   Residual land lease value. Excluding rehabilitated buildings, parks and open space, public
    right of ways, and the shipyard, ROMA and the planning team estimated the total area
    available for new development. Based on the results of EPS’s December 2007 Pier 70 Master
    Plan Market Analysis and direction from the Port, three types of uses are included in the
    feasibility analysis for new development in the Plan: biotech, medical office, and general
    office space. The analysis includes estimates of expected land lease payments from the
    development types.


Public Financing

Public financing mechanisms which are required to facilitate upfront investments needed to
prepare the site for redevelopment are also included in the analysis. Two key financing sources
are:

•   Infrastructure Financing District. Under State legislation, the Port may utilize tax
    increment financing through a mechanism called an IFD. The legislation allows the IFD to
    capture 65 percent of tax increment to fund infrastructure at the site. In addition, legislation
    is pending that would allow the Port to capture an additional 25.3 percent of the tax
    increment that would otherwise go to the State’s Educational Revenue Augmentation Fund.
    These annual tax revenues could support tax allocation bonds to be used for infrastructure
    and other public improvements on the site. The State’s portion is not included in the base
    case financial feasibility analysis, as it is an uncertain funding source.




3 The Preferred Master Plan illustrates a development program within rehabilitated buildings and the
intensity of new development at the site.




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•   Mello-Roos Community Facilities District. A CFD may be used to establish a special tax
    on property within the district. The tax revenues can be used to secure CFD bonds for
    qualifying capital improvements, and can also be used to support ongoing maintenance and
    services. The special tax typically would be paid by owners or tenants of buildings on the
    site, although it can be structured to be paid initially by the site developer. The financial
    feasibility analysis assumes that building developers would discount sublease payments to a
    master developer to reflect the additional cost burden of the special tax.


In addition to the revenues from building and land leases, known non-Port funds are included as
sources of investment to the project. Non-Port funding sources included in the analysis are:

•   Federal historic tax credits which are available for applicable rehabilitation costs.
•   San Francisco Proposition A Park Bond funding for the waterfront park.
•   Proposition D payroll and transient occupancy tax revenue.


Proposition D was passed by San Francisco voters in November 2008, amending the City Charter
to allow the Port to utilize a portion of payroll tax and transient occupancy tax revenues collected
from Pier 70 employers and hotel guests (if any) for specified investments at Pier 70. Proceeds
from the taxes may be used on a pay-as-you-go basis, or could be used to support revenue
bonds.


Costs

Costs related to the redevelopment of Pier 70 include demolition of some existing structures,
environmental remediation, building rehabilitation, new utilities, structured parking, park and
open space development, and pier and wharf repair. These cost estimates are based on Port, in-
house estimates and outside consultant efforts. Several additional documents are available that
provide the background on cost estimates including Conceptual Estimate of Probable
Construction Cost Based on Assessment of Building Conditions (M. Lee Corporation, July 2008).




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3.        LAND USE PROGRAM


The land use program elements evaluated in the feasibility analysis are based on a collaborative
planning effort led by EPS and ROMA Design Group under the direction of Port staff and
incorporates key findings of technical analyses prepared by Carey & Company (historic
preservation), OLMM Engineers (cost estimates), M Lee Corporation (cost estimates), and
Treadwell and Rollo (environmental investigation). The sections below describe the types of uses
included in the program and the total development at buildout of the project. These uses are
included for evaluation purposes; actual uses may vary.


Uses Programmed
A variety of development types and uses were considered for inclusion in the land use program.
The mix of uses included is based on a market study of development prospects at Pier 70 (see
Pier 70 Master Plan Market Analysis, released December 2007). Those which were selected for
inclusion in the feasibility analysis are detailed in Table 5.

Table 5. Description of Uses Included in Feasibility Analysis

Use                       Development Characteristics


Biotech                   The configuration of biotech buildings tends to vary by the size and type
                          of company occupying the space. Smaller companies and research
                          institutions are likely to require wet lab space for testing and
                          experiments as well as more traditional office space. Mature or larger
                          companies may require these research and office spaces as well as
                          significant product production space.

                          Because of the need many biotech users have for precise control of
                          temperature, moisture, and other elements and the difficulty in creating
                          this type of space in an older building, biotech space is confined in the
                          Pier 70 Plan to newly developed buildings only. New biotech buildings
                          will have high floor-to-ceiling heights to accommodate the necessary
                          heating, ventilating, and air conditioning (HVAC) systems.

Medical Office            Medical office is included as a specific use because of the site’s proximity
                          to the new University of California, San Francisco Mission Bay Hospital.
                          This type of use is included within the new development portion of the
                          land use program.

General Office            General office uses are anticipated to be a large portion of the mix of
                          uses. General office uses incorporated in the feasibility analysis include
                          new office space and space in rehabilitated office or other types of
                          buildings (e.g., industrial or warehouse) converted to office uses.




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Table 5. Description of Uses Included in Feasibility Analysis (continued)

Use                       Development Characteristics


Retail/Restaurant/        Aside from small cafes which may be integrated in new biotech or office
Entertainment/            space, the land use program includes retail, restaurant, entertainment,
Cultural/Institutional    cultural and institutional uses within the historic buildings. Many of these
                          structures—with their expansive interior spaces—are well-suited to uses
                          which will allow public access. The Union Iron Works complex (Buildings
                          113/114 and 115/116) is anticipated to serve as the center of these
                          types of uses.

Industrial/Warehouse      Several of the existing buildings appear best suited for continued
                          industrial or warehousing functions. These include Buildings 2 and 111.

Parking                   For the feasibility analysis, parking needs are expected to be met by
                          locating parking throughout the site. To that end, parking space has
                          been included in parking structures, within new buildings, and in
                          appropriate portions of rehabilitated structures.

Parks and Open            Parks and open space are included throughout the land use program,
Space                     specifically along the shoreline (Crane Cove Park and along the eastern
                          edge of the site), adjacent to Irish Hill, and along 20th Street.



Table 6 summarizes this land use program.

Parking assumptions within the financial model seek to balance the pitfalls of providing too much
parking—which would encourage single-occupancy vehicle commutes and displace valuable,
revenue-generating space—with undersupplying parking which may decrease office and biotech
rents and weaker the viability of uses reliant on visitors. With the goal of providing “just
enough” parking, the parking ratio included in the financial analysis is 1.0 parking spaces per
1,000 square feet of building space. Parking ratios in central business cores with easy access to
frequent transit service may have parking minimums of 0.5 spaces per 1,000 square feet or
parking maximums which may be provided. Conversely, suburban office developments like
those in South San Francisco and other areas on the Peninsula typically number 3.0 to 4.0
spaces per 1,000 square feet. The ratio selected for Pier 70 is in-line with recent development at
Mission Bay, which has a similar density and commute profile as Pier 70.

The illustrative build-out scenario includes half of the required spaces within the vertical building
pro formas and half in stand-alone parking structures. This means that the costs and revenues
associated with building and operating the parking areas are included in the vertical pro formas
of new construction and in a vertical pro forma for the parking structure. To the extent that
adapted, historic structures appeared to be able to accommodate parking, a portion of spaces
are also included in the historic rehabilitation and reuse pro formas.




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Other Uses Considered

Two other uses have been considered for the land use program: residential and hotel.
Descriptions of these uses and the rationale for their exclusion from the current land use
program are provided below.


Residential

Residential uses have been excluded from the land use program in order to avoid conflicts
between residents and shipyard operations. When a ship is in drydock, the shipyard frequently
operates throughout the day and night, generating typical heavy industrial operation impacts
around the clock. In addition, a residential development at Pier 70 would likely be isolated from
residential neighbors. With longstanding industrial uses across Illinois Street and a power plant
site to the south (where residential uses are restricted), there are few known opportunities for
residential conversions near Pier 70.

However, new residential units have been developed along both Illinois and Third Streets in
recent years, indicating market support for housing in the area. In addition, the concentration of
jobs anticipated at buildout of the land use program provides a rationale for incorporating
housing into the program to offer new employees opportunities to live nearby. While residential
uses have not been incorporated into the feasibility analysis, the integration of residential uses
has been financially tested in the Sensitivities section of the Report.


Hotel

The employment capacity of the Preferred Master Plan combined with existing and planned
commercial space and the future hospital at Mission Bay indicates the Central Waterfront area’s
potential for becoming a significant new activity-center in the City. Employment and medical
services in the area may be sufficient to support the development of a hotel. Although a hotel is
an appropriate use at Pier 70, hotel square footage is not included in the financial feasibility
analysis. Development of a hotel at Pier 70 would generate both land lease revenues as well as
Proposition D transient occupancy taxes, potentially improving the project’s economics in a
significant, favorable manner. A hotel use is excluded from the base case financial feasibility
analysis in order to avoid skewing the analysis by assuming that a less common use will be
developed at the site.




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Table 6
Project Description for 50 Acres (excludes 15 acres of ship repair uses)
Pier 70 Financial Feasibility Analysis; EPS #17007


Item                                                                                                   Total (Yrs 0-20)


Rehabilitated Buildings (sq. ft.) [1], [2]
Office                                                                                                           343,326
Industrial/PDR                                                                                                   181,211
Institutional                                                                                                    100,111
Retail                                                                                                            73,363
Parking                                                                                                           21,265
Other (non-revenue generating)                                                                                     2,294
Subtotal                                                                                                         721,569
New Development (sq. ft.) ]2]
Biotech Office                                                                                                 1,268,437
Medical Office                                                                                                   126,844
General Office                                                                                                 1,141,593
Parking Structure                                                                                                560,205
Subtotal                                                                                                       3,097,079
Total Development and Rehabilitated (sq. ft.)                                                                  3,818,648
Demolished Building Square Footage                                                                               172,709
Parking
Parking in Structure (spaces)                                                                                       1,724
Parking in Individual Buildings (spaces)                                                                            1,211
Total spaces provided                                                                                               2,935
Parking Ratio (spaces per 1,000 bldg. sq. ft.) [2]                                                                    1.0

Parks / Open Space Acreage [3]
Crane Cove Park                                                                                                      7.73
Irish Hill                                                                                                           1.53
Shipways Park                                                                                                        4.89
Central Plaza                                                                                                        0.41
Blocks 1-6 Open Space/Plazas                                                                                         8.03
Total Parks and Open Space                                                                                          22.60

[1] Square footage is shown for historic buildings by the type of use used in the model. Several buildings are
  expected to accommodate a mix of uses.
[2] Parking is in part provided in structures and in part within buildings. Square feet by use reflects the total
  gross building square feet, a portion of which is used for parking.
[3] The ratio is slightly above 1.0 space per 1,000 due to the higher parking ratio afforded the medical land use.
[4] Equal to 984,569 sq, ft. Open space on "blocks" 1 through 6 includes plazas and the spaces between development
  within the blocks as illustrated in the Preferred Master Plan.
Source: Port of San Francisco; ROMA Design; Economic & Planning Systems




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4.      REVENUES


Revenue sources include direct revenue from site users (lease revenue) and public revenue. The
sections below describe the types and magnitude of revenues.


Real Estate Revenues

The project will receive rent revenues from rehabilitated building leases and ground leases for
new development pads.


Ground Lease Revenue

Revenues will be generated through ground lease revenue. The value of the ground leases are
based on land values determined by the difference between vertical construction costs and the
capitalized value of the building. Revenues from new development uses has been estimated by:
(1) Establishing assumptions for net rents from tenants; (2) Estimating direct and indirect
building construction costs; (3) Including cost overruns (contingency) and a builder profit; (4)
Capitalizing revenues, net of total costs which results in the residual land value for the given
use; and (5) Assuming that a proportion of the residual land value (8.5 percent) represents the
land lease value. The land lease value is the cash flow that a horizontal developer may expect to
receive from a vertical developer, constructing particular uses and amounts of leasable building
space. These steps result in an estimate of the value of the land generated by the development.
The ground rent per use is developed in 2009 dollars in a series of vertical pro formas included in
Appendix A. Descriptions of assumptions used for capitalization rates, ground lease factors,
and parking are included below.

Capitalization Rates
A capitalization rate (cap rate) is the ratio between the net operating income of an asset and the
total market value of the asset. In the vertical pro formas for Pier 70 buildings, capitalization
rates are used as assumptions to estimate the market value of the net operating income. Cap
rates reflect the perceived risk associated with the project including the estimated development
costs, vacancy rate, and building lease rates. Historic capitalization rates in San Francisco’s
office market range from about 5 percent to 9 percent (i.e., net operating income is between 5
and 9 percent of total market value). Three different cap rates are applied in the vertical pro
formas:

•    New commercial development. Given the various opportunities and constraints of
     development at the site, a cap rate in the middle of the historic range has been selected for
     all new commercial development modeled at Pier 70 (7 percent).

•    Rehabilitated buildings. While some of the rehabilitated buildings may provide unique and
     spectacular spaces, other older buildings adapted for modern uses may not provide the same
     level of amenities and functionality that new construction supplies. Rather than




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    differentiating among the buildings and projecting how the market will view these buildings,
    a single cap rate has been applied to all historic buildings, at the high end of the historic
    range (8.5 percent).

•   Parking structure. A conservative cap rate has been applied to parking structures (9
    percent)

Ground Lease Factor
The residual land value results from subtracting total development costs from the building value.
This represents the value of the land, given the assumed development program built. In order
to calculate the annual lease rate a developer would be willing to pay for the right to construct
the project, a ground lease rate factor is applied to the residual land value. For modeling
purposes, the ground lease factor selected (8.5 percent) is equivalent to a conservative
capitalization rate for the San Francisco land.

Parking Assumptions
The portion of parking for the project that is provided within the building pads (0.5 spaces per
1,000 square feet of building space with another 0.5 spaces per 1,000 included in standalone
parking structures) is included in the pro formas by use. To estimate lease revenue, the building
size is reduced to account for the portion occupied by parking. Parking revenues are included
assuming monthly parking rates of $225 in 2009 values and daily rates of $8 per space.

New Building Development Revenue
Values for ground leases vary according to use, as shown in Table 7, below. Appendix Tables
A1 through A8 provide details on the vertical costs and revenues associated with new
development by type of use. For example, Table A1, the biotech use pro forma, illustrates the
square feet of new development assumed in the analysis and the revenues and costs associated
with the construction and occupancy of the development. The calculation results in an estimated
residual land lease value. This lease value is applied to the revenue section of the project cash
flow.

Reversion Value
At the end of the 30-year cash flow period, the lump-sum value of future ground lease and
rehabilitated building lease revenues are included in the analysis for the NPV and IRR measures.
This means that at the end of the 30 years, the development entity may sell its interest in the
site. This potential sale value is estimated to be equal to the present value of future lease
income less annual costs (e.g., base rent to the Port, environmental monitoring costs, etc.).




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Table 7. Summary of Vertical Pro Forma Results


                           Medical     General                                                             For-Sale                     Rental
Item             Biotech    Office      Office                                   Hotel                  Condominiums                  Apartments

End User            $50       $46         $40 / building Sq.              $150 /room per             $510,000 / Unit                   $3 /Sq. Ft. per
                                                 Ft./year (NNN)                   night                                                     month
Rent/Price
Construction       $435     $348         $352 /building Sq. Ft.           $299 /building Sq.               $452 /building Sq.       $395 /building Sq.
                                                                                  Ft.                              Ft.                      Ft.
Cost
Building Value     $509     $407         $410 /building Sq. Ft.           $362 /building Sq.               $490 /building Sq.       $423 /building Sq.
                                                                                  Ft.                              Ft.                      Ft.

Residual Land       $75       $59         $58    /building Sq. Ft.         $64    /building Sq.             $37    /building Sq.     $29 /building Sq.
                                                                                  Ft.                              Ft.                      Ft.
Value
Ground Rent          $6        $5          $5    /building Sq.              $5    /building Sq.               $3   /building Sq.       $2 /building Sq.
                                                 Ft./year                         Ft./year                         Ft./year                 Ft./year




Existing Building Lease Revenue

In order to estimate likely revenues and costs of rehabilitated buildings, the Port team and
consultant developed an adaptive reuse program. The program includes total building square
footage and use for each building expected to be included in the land use plan. The uses
included in the adaptive reuse program are office, institutional/ cultural, retail, warehouse or
storage, retail, and parking. Lease revenues associated with these uses range in value from $15
to $36 per square foot per year. All of the lease rates contained in the historic buildings analysis
are based on advertised space for rent in late 2007 in the Dogpatch/Potrero Hill/Showplace
Square area of the City. Table 8 illustrates the average result for all historic buildings in terms
of the end user price (lease rate), the rehabilitation cost, the building value based on the
capitalized lease stream, and net value of the rehabilitated building.

Table 8. Summary of Rehabilitated Building Pro Forma Factors

Item                                   Average

End User                             $26 / building Sq.
                                            Ft./year (NNN)
Rent/Price

Construction Cost               $456 /building Sq. Ft.


Building Value                  $231 /building Sq. Ft.


Net Rehabilitated              ($134) /building Sq. Ft.
Building Value


Table 9 illustrates the uses by building and expected lease revenues. The uses and building
square feet devoted to each use were developed based on site tours by ROMA, EPS, and the Port
and extensive discussions regarding the most appropriate use for each building. These represent
the leasable square footage. In several cases, large single-story buildings are assumed to be
subdivided with mezzanine areas.




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Timing of Development

The absorption rate of new development and occupancy of existing building space is a primary
driver of the feasibility of the Plan. Based on the results of EPS’s market study completed for the
Port for Pier 70, full Plan buildout assumes an 18-year absorption. This absorption period
translates into an average of 170,000 square feet of new building space occupied annually.
Table 10 illustrates the absorption of specific historic buildings and new development on an
annual and cumulative basis.


Interim Leasing Revenues

At the present, Pier 70 has a number of existing tenants paying about $2.9 million a year in rent.
The financial model assumes that these leases phase out over the first ten years of the
development program and that the master developer receives the interim leasing revenue. The
exact timing of termination of existing leases will be determined as the project is implemented.
It is likely that some users can be relocated into rehabilitated historic buildings and retain
operations at Pier 70.


Public Financing Sources

The financial requirements to adaptively reuse Pier 70 will require a full range of public and
private financing sources and mechanisms integrated in a comprehensive financing strategy. A
substantial portion of the funds needed for development of infrastructure and public facilities and
to rehabilitate historic structures will come from real estate revenues generated by rehabilitated
buildings and from new development. Financial analyses to date demonstrate that the economic
value of new uses at Pier 70 cannot fund the extraordinary costs of historic rehabilitation,
environmental remediation, parks, and new infrastructure. Public financing mechanisms are
required to close the feasibility gap. This section discusses potential public financing tools in this
implementation effort: Infrastructure Financing District , Mello-Roos Community Facilities
District, and Pier 70 Proposition D funding.


Infrastructure Financing District

As discussed earlier, an IFD allows for growth in future property taxes to be captured and
reinvested in the project. This revenue stream can be accessed by public bonds on a tax-exempt
debt basis and can be used on an annualized, pay-as-you go basis as well. Property taxes grow
significantly after rehabilitation and development is well underway, making this tool valuable.
Only when public finance markets know that an adequate property tax revenue stream is in
place, or soon will be, to pay back the bonds can bonds be issued. Property tax-based finance is
a common tool used for redevelopment and new development projects in California.

IFD revenues are estimated by projecting the assessed value of new development and
rehabilitated buildings, less any existing property assessed value. (Table 11 illustrates the
calculation.) These values are based on the capitalized net operating income of the buildings.
The difference between the two is the incremental assessed value. One percent of the
incremental value is the incremental tax value and a portion of that amount may be captured for
the project. Under the State legislation which enables the Port to create IFDs, the local portion
of the tax increment may be captured by the Port for investments in the property including



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infrastructure, historic rehabilitation, and other site improvements.4 The EPS analysis assumes
that 65 percent of the total tax increment will be subject to use by the project. In order to
calculate the amount of the IFD bonds, EPS completed the following steps:

•   Estimate the value of the new uses (capitalized value of new construction plus capitalized
    value of rehabilitated buildings), less the existing value of the site.

•   Multiply the incremental amount by 1 percent to calculate the tax increment (TI).

•   Calculate 65 percent of the TI, reflecting the assumed portion of tax increment which may be
    diverted to IFD improvements.

•   Use 65 percent of TI to make a bond payment with the coverage factor of 1.25

•   Estimate bond proceeds assuming issuance over a 30-year term with the interest rate of 6.0
    percent and an issuance cost of 10 percent.


Mello-Roos Community Facilities District

A CFD may be used to establish a special tax on property within the district. Creation of a CFD
to finance the construction of new community infrastructure would levy additional property taxes
on land located inside the district, creating a revenues stream to issue bonds. Table 12 projects
the level of revenues which may be generated through the tax. The cumulative new assessed
value created through the development of new development is shown. The analysis utilizes the
following steps to estimate financing from CFD bonds:

•   Estimate the overall development value.

•   Base the CFD payment on 0.65 percent of the overall development value.

•   Assume a cost of 12 percent for delinquencies and 0.5 percent for administration.

•   The bond issuance is assumed over a 30-year term with an interest rate of 6.0 percent and
    an issuance cost of 5.0 percent.

The use of a CFD is considered to be a financing tool which may be selected by development
partner(s). The special tax typically would be paid by owners or tenants of buildings on the site,
although it can be structured to be paid initially by the site developer. The analysis assumes
that building developers would discount sublease payments to a master developer to reflect the
additional cost burden of the special tax.5 Assuming a tax of 0.65 percent of assessed value,




4  Table 11 also calculates the State’s portion of the tax increment. This amount is calculated for
illustrative purposes only, the revenue is not included in the base case project cash flow.
5 This estimate is based on EPS’s experience in prior projects. The tax amount is often viewed as
somewhat separate from the lease rate, suggesting that tenants tend to partially discount the lease
amount they are willing to pay by the amount of the CFD tax. This may change to a discount rate of
100 percent as tenants analyze how the tax may affect their total payments for space.




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more than $120 million in bonds may be issued while new development is constructed. Note
that although the tax value is calculated on ad valorem basis for modeling, the actual
implementation would be structured some other metric, such as parcel or building size.


Proposition D

The other major source of public funding is the provisions for funding under the November 2009
Proposition D adding section B.7.310 to the San Francisco Charter. The Board of Supervisors can
adopt a Pier 70 Finance plan that commits to Pier 70 a 20-year funding stream equivalent to up
to 75 percent of the projected growth in payroll and hotel taxes generated by the Pier 70 project.
The model only assumes payroll taxes are generated based on the expected building program.
Table 13 details the calculation of this funding source. As shown, building square feet absorbed
per year are translated into on-site employment, based on estimated employment density.
Payroll taxes in San Francisco are calculated based on 1.5 percent of payroll.

In order to estimate the payroll of the various types of tenants which may locate at Pier 70, EPS
consulted the Bureau of Labor Statistics estimates of average wages for the San Francisco area
for several types of occupations including Office and Administrative Support; Life, Physical, and
Social Science; Healthcare Practitioner, Technical and Healthcare Support; Office and
Administrative Support; Business and Financial Operations; Computer and Mathematical Science;
and Architecture, Engineering, and Legal. Because wages below a certain level and biotech
companies which have been located in San Francisco for seven years or less are exempt from the
payroll tax, only a portion of the total wages projected to be earned on site are included in the
estimate of payroll taxes. Specifically, the following steps outline the approach in estimating the
payroll tax:

•   Estimated employment based on building densities with 450 square feet per employee for
    existing uses and new biotech space and between 275 and 350 square feet per employee for
    general and medical office space. These assumptions result in the total of 6,195 new
    employees.

•   Calculate the total payroll by development type based on likely occupation assumptions by
    land use and income assumptions by industry provided by the Bureau of Labor Statistics.
    The incomes are estimated to range from an average of $39,400 for employees in existing
    uses to an average of $76,200 for biotech employees.

•   Total payroll is estimated by adding up the aggregate incomes across land uses with 80
    percent of the payroll assumed to be subject to the payroll tax. This assumption is based on
    the San Francisco payroll tax ordinance that exempts clean energy technology sector, jobs
    partially located in jurisdictions outside of San Francisco, and jobs with incomes below a
    minimum threshold, as defined by the City. In addition, positions in biotech are assumed to
    be subject to 50 percent of the payroll tax during the first seven years based on the payroll
    tax ordinance exemption for biotech firms during the first seven years of operation in the
    City.

•   75 percent of the 1.5 percent payroll tax is assumed to be invested into infrastructure and
    approved projects at Pier 70 which is equal to the maximum portion which may be used for
    this purpose, per the language in Proposition D.




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Taking all of these assumptions into consideration, approximately $350,000 per year is expected
to be generated from Proposition D-allowed payroll taxes.

For the purposes of analysis, payroll taxes generated are assumed to be used to support a
revenue bond. Table 14 estimates the value of the bond. As shown, net of various
administrative costs, the bond supported a payment equivalent to 75 percent of the payroll tax
generation for 20 years, totaling $48.5 million assuming 6 percent interest rate and 5 percent
issuance costs. This amount is included in the project cash flow in year 5. The other primary
public funding source, federal historic tax credits, will be discussed in the next chapter.


Private Capital Investment
In addition to the above revenue sources, a substantial amount of private capital investment will
be necessary to accomplish the redevelopment of Pier 70. Early investments will be needed for
planning and predevelopment, environmental analysis, and entitlement activities. The model
assumes a $2 million year 0 cost for this. Post entitlement, private capital will be needed for
demolition, environmental remediation, grading, infrastructure, marketing, and other project
development costs as development proceeds and project revenues increase over the course of
buildout.




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     Table 9
     Adaptive Reuse: Space by Type/Lease Rates
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                               Total Sq.Ft. Devoted to Use                                                                                   Rent
     Building                              Bldg. Sq. Ft.             Office Industrial Institutional    Retail Parking             Other               Office    Industrial/PDR Institutional         Retail         Parking Other                Total          Ave.
     Numbers                                                                                                                                                          Annual per sq.ft. rent assumption                                                           per
                                                                                                                                                      $36.00             $15.00           $20.00          $18.00      $4.50 $0.00                              Sq.Ft.
                                                                                                                                                           [2]                [3]              [4]             [5]        [6]   [7]


     101                                            56,268           56,268           0               0              0         0         0       $2,025,648                   $0                 $0            $0        $0        $0     $2,025,648               $36
     104                                            37,641           37,641           0               0              0         0         0       $1,355,076                   $0                 $0            $0        $0        $0     $1,355,076               $36
     102                                             8,424                0           0               0         8,424          0         0                 $0                 $0                 $0     $151,632         $0        $0        $151,632              $18
     103                                             2,258                0           0               0         2,258          0         0                 $0                 $0                 $0      $40,644         $0        $0         $40,644              $18
     2                                              96,804           28,073     68,731                0              0         0         0       $1,010,634         $1,030,963                   $0            $0        $0        $0     $2,041,596               $21
     6                                              37,707                0     37,707                0              0         0         0                 $0         $565,605                   $0            $0        $0        $0        $565,605              $15
     110                                             3,910                0           0               0         1,955          0    1,955                  $0                 $0                 $0      $35,190         $0        $0         $35,190               $9
     111                                            46,272           11,568     34,704                0              0         0         0         $416,448           $520,560                   $0            $0        $0        $0        $937,008              $20
     52                                             24,983                0     24,983                0              0         0         0                 $0         $374,751                   $0            $0        $0        $0        $374,751              $15
     113-114                                       100,111                0           0       100,111                0         0         0                 $0                 $0     $2,002,220                $0        $0        $0     $2,002,220               $20
     115                                            36,867                0           0               0       27,650      9,217          0                 $0                 $0                 $0     $497,705 $41,475           $0        $539,180              $15
24




     116                                            36,867                0           0               0       27,650      9,217          0                 $0                 $0                 $0     $497,705 $41,475           $0        $539,180              $15
     12                                            162,335          162,335           0               0              0         0         0       $5,844,060                   $0                 $0            $0        $0        $0     $5,844,060               $36
     14                                             38,947           38,947           0               0              0         0         0       $1,402,092                   $0                 $0            $0        $0        $0     $1,402,092               $36
     21                                             10,172                0      5,086                0         5,086          0         0                 $0           $76,290                  $0      $91,548         $0        $0        $167,838              $17
     50                                               678                 0           0               0           339          0      339                  $0                 $0                 $0       $6,102         $0        $0           $6,102              $9
     19                                             10,000                0     10,000                0              0         0         0                 $0         $150,000                   $0            $0        $0        $0        $150,000              $15
     Kneass                                         11,325            8,494           0               0              0    2,831          0         $305,775                   $0                 $0            $0 $12,741          $0        $318,516              $28
     Total                                         721,569          343,326   181,211         100,111         73,363 21,265         2,294      $12,359,733         $2,718,169       $2,002,220        $1,320,525 $95,691          $0    $18,496,338           $25.63

     Spaces provided @ 325 Sq.Ft. per space                    65   723,827
     Effective Parking Ratio                                 0.10

     [1] Uses within each building are roughly proportioned, based on Port/ROMA/EPS walk-through of buildings.
     [2] Rent assumption reflects monthly lease rate of $3.00, which is consistent with typical rents in the area.
     [3] Rent assumption reflects monthly lease rate of $1.25, which is on the higher end of rents in the area. This rate is slightly above the expected average rent reported by non-profits;
       to the extent that an institutional user is found, this rate may be higher.
     [4] Rent assumption reflects monthly lease rate of $1.67. Due to the unique nature of these users, this assumption is highly speculative.
     [5] Rent assumption reflects monthly lease rate of $1.50. This amount is consistent with the middle to lower end of advertised lease rates in the area.
     [6] Rent assumption reflects monthly lease rate of $.38. This amount is based on a parking pro forma which includes a mixture of monthly and daily parkers.
       After operating expenses, the net revenue from parking is estimated at about $55 per square foot. This amount is converted into an annual lease payment.
       Parking tax generated on an annual basis from spaces included in this proforma total $900.
     [7] Includes non-revenue generating uses such as public space or Port uses.



     Sources: Port of San Francisco; ROMA Design; Economic & Planning Systems




     Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                        P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
     Table 10
     Phasing Assumptions
      Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                        Year
     Building                                                         Use                                   Total     0             1         2         3            4                    5                  6


     Existing Buildings and Structures                                                                   sq.ft. / %
      Building 101                              Office Type 1                                              56,268           0   56,268         0        0            0                   0                  0
      Building 102                              Adaptive Reuse 1                                             8,424          0        0     8,424        0            0                   0                  0
      Building 2                                Adaptive Reuse 1                                           96,804           0        0         0        0            0                   0                  0
      Building 104                              Office Type 1                                              37,641           0        0         0        0            0              37,641                  0
      Building 6                                Adaptive Reuse 1                                           37,707           0        0         0        0            0                   0                  0
      Knease                                    Adaptive Reuse 1                                           11,325           0        0         0        0            0                   0                  0
      Building 110                              Adaptive Reuse 1                                             3,910          0        0         0        0            0                   0                  0
      Building 111                              Adaptive Reuse 1                                           46,272           0        0         0        0            0                   0                  0
      Building 52                               Adaptive Reuse 1                                           24,983           0        0         0        0            0                   0                  0
      Building 113-114                          Adaptive Reuse 1                                          100,111           0        0         0        0      100,111                   0                  0
      Building 115-116                          Adaptive Reuse 1                                           73,734           0        0         0        0            0                   0             73,734
      Building 12                               Adaptive Reuse 1                                          162,335           0        0         0        0            0                   0                  0
      Building 14                               Adaptive Reuse 1                                           38,947           0        0         0        0            0                   0                  0
      Building 21                               Adaptive Reuse 1                                           10,172           0        0         0        0            0                   0                  0
      Building 19                               Adaptive Reuse 1                                           10,000           0        0         0        0            0                   0                  0
      Building 50                               Adaptive Reuse 1                                               678          0        0         0        0            0                   0                  0
      Park Space                                Parks/Open Space 1                                        634,612     215,062        0         0        0            0                   0                  0
      TOTAL Building Sq. Ft. Only, Excludes Demo'ed                                                       719,311           0   56,268     8,424        0      100,111              37,641             73,734

     New Buildings and Structures                                                                           sq.ft.
     Building N8                                        Biotech Office                                  1,268,437          0         0    74,614    74,614      74,614             74,614              74,614
     Building N9                                        Medical Office                                    126,844          0    63,422    63,422         0           0                  0                   0
     Building N10                                       Office (General)                                1,141,594          0         0    67,153    67,153      67,153             67,153              67,153
25




     Infrastructure N1                                  Structured Parking                                560,205          0         0         0         0           0                  0                   0
     TOTAL Building and Parking SF                                                                      3,097,080          0    63,422   205,188   141,767     141,767            141,767             141,767


     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
     of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                            Page 1 of 6
     Table 10
     Phasing Assumptions
      Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                              Year
     Building                                                         Use                                   Total          7         8         9        10           11              12                  13


     Existing Buildings and Structures                                                                   sq.ft. / %
     Building 101                              Office Type 1                                               56,268           0         0         0         0         0                0                   0
     Building 102                              Adaptive Reuse 1                                              8,424          0         0         0         0         0                0                   0
     Building 2                                Adaptive Reuse 1                                            96,804           0         0         0         0         0                0                   0
     Building 104                              Office Type 1                                               37,641           0         0         0         0         0                0                   0
     Building 6                                Adaptive Reuse 1                                            37,707           0         0         0         0         0                0                   0
     Knease                                    Adaptive Reuse 1                                            11,325      11,325         0         0         0         0                0                   0
     Building 110                              Adaptive Reuse 1                                              3,910          0         0         0         0     3,910                0                   0
     Building 111                              Adaptive Reuse 1                                            46,272           0         0         0    46,272         0                0                   0
     Building 52                               Adaptive Reuse 1                                            24,983           0         0         0    24,983         0                0                   0
     Building 113-114                          Adaptive Reuse 1                                           100,111           0         0         0         0         0                0                   0
     Building 115-116                          Adaptive Reuse 1                                            73,734           0         0         0         0         0                0                   0
     Building 12                               Adaptive Reuse 1                                           162,335           0         0         0         0         0          162,335                   0
     Building 14                               Adaptive Reuse 1                                            38,947           0    38,947         0         0         0                0                   0
     Building 21                               Adaptive Reuse 1                                            10,172           0         0    10,172         0         0                0                   0
     Building 19                               Adaptive Reuse 1                                            10,000           0         0         0         0         0                0              10,000
     Building 50                               Adaptive Reuse 1                                                678          0         0         0         0       678                0                   0
     Park Space                                Parks/Open Space 1                                         634,612     167,395         0         0    25,700         0                0             146,362
     TOTAL Building Sq. Ft. Only, Excludes Demo'ed                                                        719,311      11,325    38,947    10,172    71,255     4,588          162,335              10,000

     New Buildings and Structures                                                                           sq.ft.
     Building N8                                        Biotech Office                                  1,268,437      74,614    74,614    74,614    74,614    74,614           74,614              74,614
     Building N9                                        Medical Office                                    126,844           0         0         0         0         0                0                   0
     Building N10                                       Office (General)                                1,141,594      67,153    67,153    67,153    67,153    67,153           67,153              67,153
26




     Infrastructure N1                                  Structured Parking                                560,205           0         0         0         0         0          186,735                   0
     TOTAL Building and Parking SF                                                                      3,097,080     141,767   141,767   141,767   141,767   141,767          328,502             141,767


     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
     of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                            Page 2 of 6
     Table 10
     Phasing Assumptions
      Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                     Year
     Building                                                         Use                                   Total         14        15        16       17          18             19            20


     Existing Buildings and Structures                                                                   sq.ft. / %
     Building 101                              Office Type 1                                               56,268           0         0        0         0          0               0              0
     Building 102                              Adaptive Reuse 1                                              8,424          0         0        0         0          0               0              0
     Building 2                                Adaptive Reuse 1                                            96,804      96,804         0        0         0          0               0              0
     Building 104                              Office Type 1                                               37,641           0         0        0         0          0               0              0
     Building 6                                Adaptive Reuse 1                                            37,707           0         0        0         0     37,707               0              0
     Knease                                    Adaptive Reuse 1                                            11,325           0         0        0         0          0               0              0
     Building 110                              Adaptive Reuse 1                                              3,910          0         0        0         0          0               0              0
     Building 111                              Adaptive Reuse 1                                            46,272           0         0        0         0          0               0              0
     Building 52                               Adaptive Reuse 1                                            24,983           0         0        0         0          0               0              0
     Building 113-114                          Adaptive Reuse 1                                           100,111           0         0        0         0          0               0              0
     Building 115-116                          Adaptive Reuse 1                                            73,734           0         0        0         0          0               0              0
     Building 12                               Adaptive Reuse 1                                           162,335           0         0        0         0          0               0              0
     Building 14                               Adaptive Reuse 1                                            38,947           0         0        0         0          0               0              0
     Building 21                               Adaptive Reuse 1                                            10,172           0         0        0         0          0               0              0
     Building 19                               Adaptive Reuse 1                                            10,000           0         0        0         0          0               0              0
     Building 50                               Adaptive Reuse 1                                                678          0         0        0         0          0               0              0
     Park Space                                Parks/Open Space 1                                         634,612           0    80,093        0         0          0               0              0
     TOTAL Building Sq. Ft. Only, Excludes Demo'ed                                                        719,311      96,804         0        0         0     37,707               0              0

     New Buildings and Structures                                                                           sq.ft.
     Building N8                                        Biotech Office                                  1,268,437      74,614    74,614    74,614    74,614    74,614               0              0
     Building N9                                        Medical Office                                    126,844           0         0         0         0         0               0              0
     Building N10                                       Office (General)                                1,141,594      67,153    67,153    67,153    67,153    67,153               0              0
27




     Infrastructure N1                                  Structured Parking                                560,205           0   186,735         0   186,735         0               0              0
     TOTAL Building and Parking SF                                                                      3,097,080     141,767   328,502   141,767   328,502   141,767               0              0


     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
     of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                              P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                         Page 3 of 6
     Table 10
     Phasing Assumptions
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                                             Year
     Item                                                                                        Total (Yrs 0-30)    0              1               2                3                4                    5                   6

     Cumulative Development (sq.ft.)
     Rehabbed Building Area ( includes some parking sq.ft.)                                               719,311           0        56,268          64,692          64,692          164,803               202,444            276,178
     New Buildings (includes some parking sq.ft.)                                                       2,536,875           0        63,422         268,610         410,377          552,143               693,910            835,676
     Parking Structure                                                                                    560,205           0             0               0               0                0                     0                  0
     Total Development                                                                                  3,816,391           0       119,690         333,302         475,069          716,946               896,354          1,111,854
     Cumulative Parking
     Parking Demand (spaces) [1]                                                                             2,880          0              90             252              359              541                  676                 839
     Parking Supply (spaces)
       in Rehabbed Buildings                                                                                    65           0               5               6                6               15                   18                  25
       in Vertical Pro Formas                                                                                1,146           0              55            170               231              292                  353                 414
       in Structured Parking                                                                                 1,724           0               0               0                0                0                    0                   0
       Total Supply (spaces)                                                                                 2,935           0              60            176               237              307                  371                 439
     (Surface Parking Required) (spaces) [2]                                                                   721          0             (31)            (76)            (122)            (234)                (305)               (400)
     (Surface Parking Acres Required) (acres)                                                                  5.8       0.00           (0.25)          (0.61)           (0.98)           (1.88)               (2.45)              (3.21)
     Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]
     Building 101                                                                                    $18,365,875           $0    $18,365,875              $0                $0             $0                  $0                  $0
     Building 102                                                                                     $1,355,702           $0             $0      $1,355,702                $0             $0                  $0                  $0
     Building 2                                                                                      $18,431,482           $0             $0              $0                $0             $0                  $0                  $0
     Building 104                                                                                    $12,286,022           $0             $0              $0                $0             $0         $12,286,022                  $0
     Building 6                                                                                       $4,914,479           $0             $0              $0                $0             $0                  $0                  $0
     Knease                                                                                           $2,887,875           $0             $0              $0                $0             $0                  $0                  $0
     Building 110                                                                                      $270,311            $0             $0              $0                $0             $0                  $0                  $0
     Building 111                                                                                     $8,495,539           $0             $0              $0                $0             $0                  $0                  $0
     Building 52                                                                                      $3,256,118           $0             $0              $0                $0             $0                  $0                  $0
28




     Building 113-114                                                                                $18,153,461           $0             $0              $0                $0    $18,153,461                  $0                  $0
     Building 115-116                                                                                 $9,327,965           $0             $0              $0                $0             $0                  $0          $9,327,965
     Building 12                                                                                     $52,986,144           $0             $0              $0                $0             $0                  $0                  $0
     Building 14                                                                                     $12,712,301           $0             $0              $0                $0             $0                  $0                  $0
     Building 21                                                                                      $1,481,382           $0             $0              $0                $0             $0                  $0                  $0
     Building 19                                                                                      $1,303,333           $0             $0              $0                $0             $0                  $0                  $0
     Building 50                                                                                         $46,872           $0             $0              $0                $0             $0                  $0                  $0
     Other Rehabbed Buildings                                                                                 $0           $0             $0              $0                $0             $0                  $0                  $0
     Assessed New Value by Land Use (2009, uninflated dollars) [3]
     Biotech Office                                                                                 $646,002,828           $0             $0     $38,000,166     $38,000,166      $38,000,166         $38,000,166        $38,000,166
     Medical Office                                                                                  $51,582,726           $0    $25,791,363     $25,791,363              $0               $0                  $0                 $0
     Office (General)                                                                               $467,769,271           $0             $0     $27,515,839     $27,515,839      $27,515,839         $27,515,839        $27,515,839

     TOTAL ASSESSED VALUE                                                                         $1,331,629,688           $0    $44,157,238     $92,663,071     $65,516,006      $83,669,467         $77,802,028        $74,843,971

     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
       of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                          P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                     Page 4 of 6
     Table 10
     Phasing Assumptions
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                                                          Year
     Item                                                                                        Total (Yrs 0-30)       7                8                9               10               11              12                  13

     Cumulative Development (sq.ft.)
     Rehabbed Building Area ( includes some parking sq.ft.)                                               719,311        287,503         326,450          336,622          407,877         412,465         574,800             584,800
     New Buildings (includes some parking sq.ft.)                                                       2,536,875        977,443       1,119,209        1,260,976        1,402,742       1,544,509       1,686,275           1,828,042
     Parking Structure                                                                                    560,205              0               0                0                0               0         186,735             186,735
     Total Development                                                                                  3,816,391      1,264,946       1,445,659        1,597,598        1,810,619       1,956,974       2,447,811           2,599,577
     Cumulative Parking
     Parking Demand (spaces) [1]                                                                             2,880            955            1,091            1,206            1,367         1,477              1,847               1,962
     Parking Supply (spaces)
       in Rehabbed Buildings                                                                                    65              26               30               31            37              38                52                    53
       in Vertical Pro Formas                                                                                1,146             475              536              597           658             719               780                   841
       in Structured Parking                                                                                 1,724               0                0                0             0               0               575                   575
       Total Supply (spaces)                                                                                 2,935             501              566              628           695             756            1,407                 1,469
     (Surface Parking Required) (spaces) [2]                                                                   721           (454)            (525)            (578)         (672)           (721)             (441)                 (493)
     (Surface Parking Acres Required) (acres)                                                                  5.8          (3.64)           (4.22)           (4.65)        (5.40)          (5.79)            (3.54)                (3.96)
     Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]
     Building 101                                                                                    $18,365,875              $0              $0               $0               $0             $0              $0                  $0
     Building 102                                                                                     $1,355,702              $0              $0               $0               $0             $0              $0                  $0
     Building 2                                                                                      $18,431,482              $0              $0               $0               $0             $0              $0                  $0
     Building 104                                                                                    $12,286,022              $0              $0               $0               $0             $0              $0                  $0
     Building 6                                                                                       $4,914,479              $0              $0               $0               $0             $0              $0                  $0
     Knease                                                                                           $2,887,875      $2,887,875              $0               $0               $0             $0              $0                  $0
     Building 110                                                                                      $270,311               $0              $0               $0               $0       $270,311              $0                  $0
     Building 111                                                                                     $8,495,539              $0              $0               $0       $8,495,539             $0              $0                  $0
     Building 52                                                                                      $3,256,118              $0              $0               $0       $3,256,118             $0              $0                  $0
29




     Building 113-114                                                                                $18,153,461              $0              $0               $0               $0             $0              $0                  $0
     Building 115-116                                                                                 $9,327,965              $0              $0               $0               $0             $0              $0                  $0
     Building 12                                                                                     $52,986,144              $0              $0               $0               $0             $0     $52,986,144                  $0
     Building 14                                                                                     $12,712,301              $0     $12,712,301               $0               $0             $0              $0                  $0
     Building 21                                                                                      $1,481,382              $0              $0       $1,481,382               $0             $0              $0                  $0
     Building 19                                                                                      $1,303,333              $0              $0               $0               $0             $0              $0          $1,303,333
     Building 50                                                                                         $46,872              $0              $0               $0               $0        $46,872              $0                  $0
     Other Rehabbed Buildings                                                                                 $0              $0              $0               $0               $0             $0              $0                  $0
     Assessed New Value by Land Use (2009, uninflated dollars) [3]
     Biotech Office                                                                                 $646,002,828     $38,000,166     $38,000,166      $38,000,166      $38,000,166     $38,000,166    $38,000,166         $38,000,166
     Medical Office                                                                                  $51,582,726              $0              $0               $0               $0              $0             $0                  $0
     Office (General)                                                                               $467,769,271     $27,515,839     $27,515,839      $27,515,839      $27,515,839     $27,515,839    $27,515,839         $27,515,839

     TOTAL ASSESSED VALUE                                                                         $1,331,629,688     $68,403,881     $78,228,307      $66,997,388      $77,267,663     $65,833,190 $118,502,150           $66,819,339

     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
       of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                             P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                        Page 5 of 6
     Table 10
     Phasing Assumptions
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                                                Year
     Item                                                                                        Total (Yrs 0-30)       14               15               16               17             18               19            20

     Cumulative Development (sq.ft.)
     Rehabbed Building Area ( includes some parking sq.ft.)                                               719,311        681,604          681,604          681,604          681,604         719,311 719,311 719,311
     New Buildings (includes some parking sq.ft.)                                                       2,536,875      1,969,808        2,111,575        2,253,342        2,395,108       2,536,875 2,536,875 2,536,875
     Parking Structure                                                                                    560,205        186,735          373,470          373,470          560,205         560,205 560,205 560,205
     Total Development                                                                                  3,816,391      2,838,148        3,166,649        3,308,416        3,636,917       3,816,391 3,816,391 3,816,391
     Cumulative Parking
     Parking Demand (spaces) [1]                                                                             2,880           2,142            2,390            2,497            2,745          2,880        2,880         2,880
     Parking Supply (spaces)
       in Rehabbed Buildings                                                                                    65               62               62               62              62             65           65            65
       in Vertical Pro Formas                                                                                1,146              902              963           1,024            1,085          1,146        1,146         1,146
       in Structured Parking                                                                                 1,724              575           1,149            1,149            1,724          1,724        1,724         1,724
       Total Supply (spaces)                                                                                 2,935           1,538            2,174            2,235            2,870          2,935        2,935         2,935
     (Surface Parking Required) (spaces) [2]                                                                   721            (604)            (216)            (262)              0              0            0             0
     (Surface Parking Acres Required) (acres)                                                                  5.8           (4.85)           (1.74)           (2.11)           0.00           0.00         0.00          0.00
     Assessed Rehabbed Value by Building (2009, uninflated dollars) [3]
     Building 101                                                                                    $18,365,875              $0                 $0               $0              $0             $0             $0            $0
     Building 102                                                                                     $1,355,702              $0                 $0               $0              $0             $0             $0            $0
     Building 2                                                                                      $18,431,482     $18,431,482                 $0               $0              $0             $0             $0            $0
     Building 104                                                                                    $12,286,022              $0                 $0               $0              $0             $0             $0            $0
     Building 6                                                                                       $4,914,479              $0                 $0               $0              $0     $4,914,479             $0            $0
     Knease                                                                                           $2,887,875              $0                 $0               $0              $0             $0             $0            $0
     Building 110                                                                                      $270,311               $0                 $0               $0              $0             $0             $0            $0
     Building 111                                                                                     $8,495,539              $0                 $0               $0              $0             $0             $0            $0
     Building 52                                                                                      $3,256,118              $0                 $0               $0              $0             $0             $0            $0
30




     Building 113-114                                                                                $18,153,461              $0                 $0               $0              $0             $0             $0            $0
     Building 115-116                                                                                 $9,327,965              $0                 $0               $0              $0             $0             $0            $0
     Building 12                                                                                     $52,986,144              $0                 $0               $0              $0             $0             $0            $0
     Building 14                                                                                     $12,712,301              $0                 $0               $0              $0             $0             $0            $0
     Building 21                                                                                      $1,481,382              $0                 $0               $0              $0             $0             $0            $0
     Building 19                                                                                      $1,303,333              $0                 $0               $0              $0             $0             $0            $0
     Building 50                                                                                         $46,872              $0                 $0               $0              $0             $0             $0            $0
     Other Rehabbed Buildings                                                                                 $0              $0                 $0               $0              $0             $0             $0            $0
     Assessed New Value by Land Use (2009, uninflated dollars) [3]
     Biotech Office                                                                                 $646,002,828     $38,000,166      $38,000,166      $38,000,166      $38,000,166     $38,000,166             $0            $0
     Medical Office                                                                                  $51,582,726              $0               $0               $0               $0              $0             $0            $0
     Office (General)                                                                               $467,769,271     $27,515,839      $27,515,839      $27,515,839      $27,515,839     $27,515,839             $0            $0

     TOTAL ASSESSED VALUE                                                                         $1,331,629,688     $83,947,487      $65,516,006      $65,516,006      $65,516,006     $70,430,485             $0            $0

     [1] Calculated by multiplying the total development square footage by 325/1325, reflecting the parking ratio
       of 1 space (325 square feet) for every 1,000 square feet of gross building space .
     [2] For years with parking deficits, surface parking is assumed to be provided.
     [3] Based on capitalized value.
     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                           P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                      Page 6 of 6
     Table 11
     Infrastructure Financing District Bond and Debt Service Calculations
     Pier 70 Financial Feasibility Analysis; EPS #17007


     Item                                                    NPV (at 6%)        Total        0             1               2                 3                  4                  5                   6                      7


     Base Value [1]                                                   $0                $0       $0             $0             $0                 $0                $0                 $0                 $0                     $0
     New Value [2]                                        $7,709,740,907   $17,766,365,969       $0             $0    $46,846,414       $149,038,782      $225,758,400       $327,269,412       $426,714,490           $527,297,424
     AV Increment [3]                                     $7,709,740,907   $17,766,365,969       $0             $0    $46,846,414       $149,038,782      $225,758,400       $327,269,412       $426,714,490           $527,297,424
     Gross TI [4]                                           $77,097,028      $177,663,000        $0             $0       $468,000         $1,490,000         $2,258,000         $3,273,000         $4,267,000             $5,273,000

     65% Share of Tax Increment
     Share Available for Bond (65%)                         $50,113,068      $115,480,950        $0             $0       $304,200           $968,500         $1,467,700         $2,127,450         $2,773,550             $3,427,450
     Available for Debt Service, @1.25 Coverage             $40,090,454       $92,384,760        $0             $0       $243,360           $774,800         $1,174,160         $1,701,960         $2,218,840             $2,741,960
     Net Bond Payments                                       $5,540,338       $11,120,200        $0             $0       $243,360           $531,440          $399,360           $527,800           $516,880               $523,120
     Pay As You Go revenues [5]                             $10,623,970       $23,096,190                       $0        $60,840           $193,700          $293,540           $425,490           $554,710               $685,490

     Gross Bond Amt., 30-yr. term @ 6.0%                    $71,945,109      $153,067,675        $0             $0               $0       $3,349,809         $7,315,182         $5,497,123         $7,265,078             $7,114,766
     (Less) Issuance Costs @ 10%                            ($7,194,511)     ($15,306,768)       $0             $0               $0        ($334,981)         ($731,518)         ($549,712)         ($726,508)             ($711,477)
     Net Bond Amount [6]                                    $64,750,598      $137,760,908        $0             $0               $0       $3,014,828         $6,583,664         $4,947,411         $6,538,570             $6,403,289

     Contingent: 25% Share of Tax Increment
     Additional Share Available for Bond (25.3%)            $19,505,548       $44,948,739        $0             $0       $118,404           $376,970           $571,274           $828,069         $1,079,551             $1,334,069

     Available for Debt Service, @1.25 Coverage             $15,604,438       $35,958,991        $0             $0         $94,723          $301,576           $457,019           $662,455            $863,641            $1,067,255
     Net Bond Payments                                       $2,156,470        $4,328,324        $0             $0         $94,723          $206,853           $155,443           $205,436            $201,186             $203,614
     Pay As You Go revenues [5]                              $4,135,176        $8,989,748                       $0         $23,681           $75,394           $114,255           $165,614            $215,910             $266,814

     Gross Bond Amt.,30-yr. term @ 6.0%                     $28,003,250       $59,578,649        $0             $0               $0       $1,303,849         $2,847,294         $2,139,649         $2,827,792             $2,769,286
31




     (Less) Issuance Costs @ 10%                            ($2,800,325)      ($5,957,865)       $0             $0               $0        ($130,385)         ($284,729)         ($213,965)         ($282,779)             ($276,929)
     Net Bond Amount [6]                                    $25,202,925       $53,620,784        $0             $0               $0       $1,173,464         $2,562,564         $1,925,684         $2,545,013             $2,492,357


                                                                                                 [1] Assumed to be 0.
                                                                                                 [2] Includes value estimated by capitalizing net operating income for new uses and rehabilitated buildings. Value is shown
                                                                                                      through project build-out.
                                                                                                 [3] Difference between new and base values.
                                                                                                 [4] Gross tax increment is calculated at 1% of the AV increment.
                                                                                                 [5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.
                                                                                                 [6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year terms.
                                                                                                     No further bonds are assumed to be issued once value stabilizes.
                                                                                                     Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                           P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                Page 1 of 3
     Table 11
     Infrastructure Financing District Bond and Debt Service Calculation
     Pier 70 Financial Feasibility Analysis; EPS #17007


     Item                                                    NPV (at 6%)        Total            8                 9                  10                  11                 12                  13                     14


     Base Value [1]                                                   $0                $0             $0              $0                  $0                 $0                  $0                  $0                    $0
     New Value [2]                                        $7,709,740,907   $17,766,365,969   $624,495,363    $739,055,466        $843,875,463       $955,949,675      $1,068,931,055      $1,264,334,078        $1,390,691,006
     AV Increment [3]                                     $7,709,740,907   $17,766,365,969   $624,495,363    $739,055,466        $843,875,463       $955,949,675      $1,068,931,055      $1,264,334,078        $1,390,691,006
     Gross TI [4]                                           $77,097,028      $177,663,000      $6,245,000       $7,391,000         $8,439,000          $9,559,000         $10,689,000        $12,643,000           $13,907,000

     65% Share of Tax Increment
     Share Available for Bond (65%)                         $50,113,068      $115,480,950      $4,059,250       $4,804,150         $5,485,350          $6,213,350          $6,947,850          $8,217,950            $9,039,550
     Available for Debt Service, @1.25 Coverage             $40,090,454       $92,384,760      $3,247,400       $3,843,320         $4,388,280          $4,970,680          $5,558,280          $6,574,360            $7,231,640
     Net Bond Payments                                       $5,540,338       $11,120,200       $505,440         $595,920           $544,960            $582,400            $587,600           $1,016,080             $657,280
     Pay As You Go revenues [5]                             $10,623,970       $23,096,190       $811,850         $960,830          $1,097,070          $1,242,670          $1,389,570          $1,643,590            $1,807,910

     Gross Bond Amt., 30-yr. term @ 6.0%                    $71,945,109      $153,067,675      $7,200,658       $6,957,296         $8,202,738          $7,501,282          $8,016,638          $8,088,215          $13,986,170
     (Less) Issuance Costs @ 10%                            ($7,194,511)     ($15,306,768)      ($720,066)       ($695,730)         ($820,274)          ($750,128)          ($801,664)          ($808,821)         ($1,398,617)
     Net Bond Amount [6]                                    $64,750,598      $137,760,908      $6,480,593       $6,261,567         $7,382,464          $6,751,154          $7,214,974          $7,279,393          $12,587,553

     Contingent: 25% Share of Tax Increment
     Additional Share Available for Bond (25.3%)            $19,505,548       $44,948,739      $1,579,985       $1,869,923         $2,135,067          $2,418,427          $2,704,317          $3,198,679            $3,518,471
     Available for Debt Service, @1.25 Coverage             $15,604,438       $35,958,991      $1,263,988       $1,495,938         $1,708,054          $1,934,742          $2,163,454          $2,558,943            $2,814,777
     Net Bond Payments                                       $2,156,470        $4,328,324       $196,733         $231,950           $212,115            $226,688            $228,712            $395,490              $255,834
     Pay As You Go revenues [5]                              $4,135,176        $8,989,748       $315,997         $373,985           $427,013            $483,685            $540,863            $639,736              $703,694

     Gross Bond Amt.,30-yr. term @ 6.0%                     $28,003,250       $59,578,649      $2,802,718       $2,707,994         $3,192,758          $2,919,730          $3,120,322          $3,148,182            $5,443,848
32




     (Less) Issuance Costs @ 10%                            ($2,800,325)      ($5,957,865)      ($280,272)       ($270,799)         ($319,276)          ($291,973)          ($312,032)          ($314,818)            ($544,385)
     Net Bond Amount [6]                                    $25,202,925       $53,620,784      $2,522,446       $2,437,194         $2,873,482          $2,627,757          $2,808,290          $2,833,364            $4,899,463


                                                                                                       [1] Assumed to be 0.
                                                                                                       [2] Includes value estimated by capitalizing net operating income for new uses and rehabilitated buildings. Value is shown
                                                                                                            through project build-out.
                                                                                                       [3] Difference between new and base values.
                                                                                                       [4] Gross tax increment is calculated at 1% of the AV increment.
                                                                                                       [5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.
                                                                                                       [6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year
                                                                                                           No further bonds are assumed to be issued once value stabilizes.
                                                                                                           Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                                P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                     Page 2 of 3
     Table 11
     Infrastructure Financing District Bond and Debt Service Calculation
     Pier 70 Financial Feasibility Analysis; EPS #17007


     Item                                                    NPV (at 6%)        Total             15               16                 17                 18                  19                   20                        21


     Base Value [1]                                                   $0                $0               $0               $0               $0                 $0                   $0                       $0                        $0
     New Value [2]                                        $7,709,740,907   $17,766,365,969   $1,549,292,276   $1,685,412,078   $1,827,408,294     $1,975,493,075       $2,138,503,218                       $0                        $0
     AV Increment [3]                                     $7,709,740,907   $17,766,365,969   $1,549,292,276   $1,685,412,078   $1,827,408,294     $1,975,493,075       $2,138,503,218                       $0                        $0
     Gross TI [4]                                           $77,097,028      $177,663,000      $15,493,000      $16,854,000        $18,274,000       $19,755,000          $21,385,000                       $0                        $0

     65% Share of Tax Increment
     Share Available for Bond (65%)                         $50,113,068      $115,480,950      $10,070,450      $10,955,100        $11,878,100       $12,840,750          $13,900,250                       $0                        $0
     Available for Debt Service, @1.25 Coverage             $40,090,454       $92,384,760       $8,056,360       $8,764,080         $9,502,480       $10,272,600          $11,120,200                       $0                        $0
     Net Bond Payments                                       $5,540,338       $11,120,200        $824,720         $707,720           $738,400          $770,120             $847,600                        $0                        $0
     Pay As You Go revenues [5]                             $10,623,970       $23,096,190       $2,014,090       $2,191,020         $2,375,620        $2,568,150           $2,780,050                       $0                        $0

     Gross Bond Amt., 30-yr. term @ 6.0%                    $71,945,109      $153,067,675       $9,047,348      $11,352,132         $9,741,646       $10,163,951          $10,600,572           $11,667,071                           $0
     (Less) Issuance Costs @ 10%                            ($7,194,511)     ($15,306,768)       ($904,735)     ($1,135,213)         ($974,165)      ($1,016,395)         ($1,060,057)          ($1,166,707)                          $0
     Net Bond Amount [6]                                    $64,750,598      $137,760,908       $8,142,613      $10,216,918         $8,767,482        $9,147,556           $9,540,515           $10,500,364                           $0

     Contingent: 25% Share of Tax Increment
     Additional Share Available for Bond (25.3%)            $19,505,548       $44,948,739       $3,919,729       $4,264,062         $4,623,322         $4,998,015           $5,410,405                      $0                        $0
     Available for Debt Service, @1.25 Coverage             $15,604,438       $35,958,991       $3,135,783       $3,411,250         $3,698,658         $3,998,412           $4,328,324                      $0                        $0
     Net Bond Payments                                       $2,156,470        $4,328,324        $321,006         $275,466           $287,408           $299,754             $329,912                       $0                        $0
     Pay As You Go revenues [5]                              $4,135,176        $8,989,748        $783,946         $852,812           $924,664           $999,603            $1,082,081                      $0                        $0

     Gross Bond Amt.,30-yr. term @ 6.0%                     $28,003,250       $59,578,649       $3,521,506       $4,418,599         $3,791,748         $3,956,123           $4,126,069           $4,541,183                           $0
33




     (Less) Issuance Costs @ 10%                            ($2,800,325)      ($5,957,865)       ($352,151)       ($441,860)         ($379,175)         ($395,612)           ($412,607)           ($454,118)                          $0
     Net Bond Amount [6]                                    $25,202,925       $53,620,784       $3,169,356       $3,976,739         $3,412,574         $3,560,510           $3,713,462           $4,087,065                           $0


                                                                                                         [1] Assumed to be 0.
                                                                                                         [2] Includes value estimated by capitalizing net operating income for new uses and rehabilitated buildings. Value is shown
                                                                                                              through project build-out.
                                                                                                         [3] Difference between new and base values.
                                                                                                         [4] Gross tax increment is calculated at 1% of the AV increment.
                                                                                                         [5] These revenues which are part of the coverage ratio are also included in cash flow, see Table 18.
                                                                                                         [6] Assumes bond issuance each year Tax Increment increases while new development is occurring; leverage on 30-year terms.
                                                                                                             No further bonds are assumed to be issued once value stabilizes.
                                                                                                             Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                             P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                  Page 3 of 3
     Table 12
     Mello-Roos CFD Bond Debt Service Calculations (Nominal $)
     Pier 70 Financial Feasibility Analysis; EPS #17007

     Item                                                                           Total               0             1                 2                   3                    4                     5                    6                     7


     Cumulative Assessed Value
     (annual growth included) [1]                               a                               -           $0             $0     $27,362,057         $127,683,325          $203,975,834         $284,006,357        $367,916,022           $455,850,765

     Annual add-on-tax payment available, @ 0.65%         [2]   b=a*0.65%                       -           $0             $0         $177,853             $829,942            $1,325,843           $1,846,041          $2,391,454             $2,963,030

     Debt to Coverage Ratio @ 1.1                               c=b/1.1                                     $0             $0         $161,685             $754,492            $1,205,312           $1,678,219          $2,174,049             $2,693,664

     (Less) Delinquency @ 12%                                   d=-(c*12%)          ($27,573,380)           $0             $0         ($19,402)             ($90,539)           ($144,637)           ($201,386)           ($260,886)            ($323,240)

     (Less) Administration @ 0.5%                               e=-(c*0.5%)          ($1,148,891)           $0             $0               ($808)              ($3,772)             ($6,027)           ($8,391)           ($10,870)              ($13,468)

     Net Annual Payments Available                              f=c+d+e             $201,055,894            $0             $0         $141,474             $660,181            $1,054,648           $1,468,442          $1,902,293             $2,356,956

     Net Incremental Bond Payments                              g                               -           $0             $0         $141,474             $518,707              $394,467             $413,794            $433,851               $454,663

     Cumulative Net Incremental Bond Payments                   h                                                          $0         $141,474             $660,181            $1,054,648           $1,468,442          $1,902,293             $2,356,956
                                                                i=bond value of
     Gross Bond Amt.,30-yr. term,@ 6.5%                         prior year"g" row   $127,303,467            $0             $0                 $0         $1,847,467            $6,773,621           $5,151,216          $5,403,604             $5,665,521

     (Less) Issuance Costs @ 5%                                 j=i*5%               ($6,365,173)           $0             $0                 $0            ($92,373)           ($338,681)           ($257,561)           ($270,180)            ($283,276)

     Net Bond Amount [3]                                        k=i+j               $120,938,294            $0             $0                 $0         $1,755,093            $6,434,940           $4,893,655          $5,133,424             $5,382,245

     Discount on Lease Revs. @ 75% [4]                          l=c*75%             $150,587,276            $0             $0                 $0           $121,264              $565,869             $903,984          $1,258,665             $1,630,537
34




                                                                                                    [1] Includes assessed value of new development only. 2% statutory growth applied annually to development, once built. 3% annual growth applied
                                                                                                    to reflect market growth during build-out.
                                                                                                    [2] Between 0.50% and 0.75% are standard, add-on tax rates which the market is assumed to partially bear.

                                                                                                    [3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity. This is not
                                                                                                    meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Net bond is assumed
                                                                                                    to be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value stabilizes.

                                                                                                    [4] It is assumed that a portion of this add-on tax will be discounted from total building and land lease revenues. For the purposes of analysis, 75%
                                                                                                    of the add-on tax is assumed to be discounted from lease payments.
                                                                                                    Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                                                 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                                     Page 1 of 3
     Table 12
     Mello-Roos CFD Bond Debt Service Calculations (Nominal $)
     Pier 70 Financial Feasibility Analysis; EPS #17007

     Item                                                                           Total                    8                   9                   10                   11                  12                   13                    14


     Cumulative Assessed Value
     (annual growth included) [1]                               a                               -      $547,961,497        $644,404,254         $745,340,373        $850,936,654         $961,365,546      $1,076,805,320        $1,197,440,264

     Annual add-on-tax payment available, @ 0.65%         [2]   b=a*0.65%                       -        $3,561,750           $4,188,628           $4,844,712          $5,531,088           $6,248,876          $6,999,235            $7,783,362

     Debt to Coverage Ratio @ 1.1                               c=b/1.1                                  $3,237,954           $3,807,843           $4,404,284          $5,028,262           $5,680,796          $6,362,941            $7,075,783

     (Less) Delinquency @ 12%                                   d=-(c*12%)          ($27,573,380)          ($388,555)          ($456,941)           ($528,514)          ($603,391)           ($681,696)           ($763,553)            ($849,094)

     (Less) Administration @ 0.5%                               e=-(c*0.5%)          ($1,148,891)           ($16,190)            ($19,039)           ($22,021)            ($25,141)           ($28,404)            ($31,815)             ($35,379)

     Net Annual Payments Available                              f=c+d+e             $201,055,894         $2,833,210           $3,331,863           $3,853,749          $4,399,729           $4,970,697          $5,567,573            $6,191,310

     Net Incremental Bond Payments                              g                               -           $476,254            $498,653             $521,886            $545,981             $570,968             $596,876              $623,737

     Cumulative Net Incremental Bond Payments                   h                                        $2,833,210           $3,331,863           $3,853,749          $4,399,729           $4,970,697          $5,567,573            $6,191,310
                                                                i=bond value of
     Gross Bond Amt.,30-yr. term,@ 6.5%                         prior year"g" row   $127,303,467         $5,937,291           $6,219,251           $6,511,747          $6,815,135           $7,129,786          $7,456,080            $7,794,412

     (Less) Issuance Costs @ 5%                                 j=i*5%               ($6,365,173)          ($296,865)          ($310,963)           ($325,587)          ($340,757)           ($356,489)           ($372,804)            ($389,721)

     Net Bond Amount [3]                                        k=i+j               $120,938,294         $5,640,427           $5,908,289           $6,186,159          $6,474,378           $6,773,297          $7,083,276            $7,404,691

     Discount on Lease Revs. @ 75% [4]                          l=c*75%             $150,587,276         $2,020,248           $2,428,466           $2,855,882          $3,303,213           $3,771,197          $4,260,597            $4,772,205
35




                                                                                                    [1] Includes assessed value of new development only. 2% statutory growth applied annually to development, once built. 3% annual growth
                                                                                                    applied to reflect market growth during build-out.
                                                                                                    [2] Between 0.50% and 0.75% are standard, add-on tax rates which the market is assumed to partially bear.
                                                                                                    [3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity.
                                                                                                    This is not meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Net
                                                                                                    bond is assumed to be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value
                                                                                                    stabilizes.

                                                                                                    [4] It is assumed that a portion of this add-on tax will be discounted from total building and land lease revenues. For the purposes of
                                                                                                    analysis, 75% of the add-on tax is assumed to be discounted from lease payments.
                                                                                                    Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                                                   P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                                       Page 2 of 3
     Table 12
     Mello-Roos CFD Bond Debt Service Calculations (Nominal $)
     Pier 70 Financial Feasibility Analysis; EPS #17007

     Item                                                                           Total                   15                  16                   17                    18                     19                     20                        21


     Cumulative Assessed Value
     (annual growth included) [1]                               a                               -   $1,323,460,871       $1,455,064,045       $1,592,453,301         $1,735,838,982        $1,885,438,474          $1,923,147,243           $1,961,610,188

     Annual add-on-tax payment available, @ 0.65%         [2]   b=a*0.65%                       -        $8,602,496           $9,457,916          $10,350,946            $11,282,953           $12,255,350            $12,500,457               $12,750,466

     Debt to Coverage Ratio @ 1.1                               c=b/1.1                                  $7,820,451           $8,598,106           $9,409,951            $10,257,230           $11,141,227            $11,364,052               $11,591,333

     (Less) Delinquency @ 12%                                   d=-(c*12%)          ($27,573,380)          ($938,454)        ($1,031,773)         ($1,129,194)           ($1,230,868)          ($1,336,947)            ($1,363,686)              ($1,390,960)

     (Less) Administration @ 0.5%                               e=-(c*0.5%)          ($1,148,891)           ($39,102)           ($42,991)             ($47,050)              ($51,286)             ($55,706)               ($56,820)                 ($57,957)

     Net Annual Payments Available                              f=c+d+e             $201,055,894         $6,842,894           $7,523,343           $8,233,707             $8,975,077            $9,748,574              $9,943,545              $10,142,416

     Net Incremental Bond Payments                              g                               -          $651,584             $680,448             $710,365               $741,369              $773,497                         $0                        $0

     Cumulative Net Incremental Bond Payments                   h                                        $6,842,894           $7,523,343           $8,233,707             $8,975,077            $9,748,574              $9,748,574                $9,748,574
                                                                i=bond value of
     Gross Bond Amt.,30-yr. term,@ 6.5%                         prior year"g" row   $127,303,467         $8,145,186           $8,508,822           $8,885,753             $9,276,425            $9,681,299            $10,100,852                            $0

     (Less) Issuance Costs @ 5%                                 j=i*5%               ($6,365,173)          ($407,259)          ($425,441)            ($444,288)            ($463,821)            ($484,065)              ($505,043)                          $0

     Net Bond Amount [3]                                        k=i+j               $120,938,294         $7,737,926           $8,083,381           $8,441,465             $8,812,604            $9,197,234              $9,595,809                           $0

     Discount on Lease Revs. @ 75% [4]                          l=c*75%             $150,587,276         $5,306,838           $5,865,338           $6,448,579             $7,057,463            $7,692,923              $8,355,921                $8,355,921
36




                                                                                                    [1] Includes assessed value of new development only. 2% statutory growth applied annually to development, once built. 3% annual growth applied to
                                                                                                    reflect market growth during build-out.
                                                                                                    [2] Between 0.50% and 0.75% are standard, add-on tax rates which the market is assumed to partially bear.

                                                                                                    [3] For the purposes of this level of analysis, each increment of new assessed value is assumed to increase the level of bond capacity. This is not
                                                                                                    meant to reflect an actual bond-deal, but rather to illustrate the net bond amount available due to increases in property value. Net bond is assumed to
                                                                                                    be issued the year after the incremental value is realized. No further bonds are assumed to be issued once value stabilizes.

                                                                                                    [4] It is assumed that a portion of this add-on tax will be discounted from total building and land lease revenues. For the purposes of analysis, 75% of
                                                                                                    the add-on tax is assumed to be discounted from lease payments.
                                                                                                    Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                                      Page 3 of 3
     Table 13
     New Payroll Tax Calculation
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                  Total at                                                  Year Ending
     Project Item                                             Assumption                         Buildout       0              1                2                3            4               5                6

     Existing Buildings and Structures                                                            719,311             0            56,268           8,424             0      100,111           37,641           73,734
     New Buildings and Structures
     Biotech Office                                                                             1,268,437             0                 0       74,614           74,614       74,614           74,614           74,614
     Medical Office                                                                               126,844             0            63,422       63,422                0            0                0                0
     General Office                                                                             1,141,594             0                 0       67,153           67,153       67,153           67,153           67,153
       Total New Buildings and Structures                                                       2,536,875             0            63,422      205,188          141,767      141,767          141,767          141,767
     New Employment per year [1]
     Rehab. Buildings and Structures                        400   sf per employee                    1,798            0              141              21              0           250               94              184
       (less) existing employment [2]                       5%    of new employment                    -90            0               -7              -1              0           -13               -5               -9
     Biotech Office                                         425   sf per employee                    2,985            0                0             176            176           176              176              176
     Medical Office                                         350   sf per employee                      362            0              181             181              0             0                0                0
     General Office                                         315   sf per employee                    3,624            0                0             213            213           213              213              213
       Total Incremental Employment                                                                  8,679            0              315             590            389           627              478              564
     New Payroll (2009$)
     Rehab. Buildings and Structures [3]                $39,400   a year                     $70,852,134             $0     $5,542,398        $829,764               $0    $9,860,934     $3,707,639       $7,262,799
     Biotech Office [4]                                 $76,200   a year                    $227,423,342             $0             $0      $13,377,844     $13,377,844   $13,377,844    $13,377,844      $13,377,844
     Medical Office [5]                                 $60,200   a year                     $21,817,121             $0    $10,908,561      $10,908,561              $0            $0             $0               $0
     General Office [6]                                 $58,200   a year                    $210,922,998             $0             $0      $12,407,235     $12,407,235   $12,407,235    $12,407,235      $12,407,235
       Total Payroll                                                                        $531,015,594             $0    $16,450,959      $37,523,403     $25,785,079   $35,646,012    $29,492,717      $33,047,878
     New Payroll Subject to Payroll Tax
     Rehab. Buildings and Structures [7]                                                                            80%              80%            80%            80%            80%             80%              80%
     Biotech Office [8]                                                                                             50%              50%            50%            50%            50%             50%              50%
37




     Medical Office [7]                                                                                             80%              80%            80%            80%            80%             80%              80%
     General Office [7]                                                                                             80%              80%            80%            80%            80%             80%              80%
       Net Payroll Subject to Payroll Tax (2009$)                                           $278,965,869             $0    $13,160,767      $26,005,370     $16,614,710   $24,503,457    $19,580,821      $22,424,949

     New Payroll Tax Revenue (2009$)                       1.5% of net payroll                 $4,184,488            $0       $197,412        $390,081         $249,221     $367,552       $293,712         $336,374
     Cumulative Payroll Tax (2009$)                                                                                  $0       $197,412        $587,492         $836,713    $1,204,265     $1,497,977       $1,834,351

     [1] Square feet per employee take into account the factors used in the Mission Bay SEIR. New office space is assumed to have higher-density employment ratio because of more modernized
       and efficient floor plans and design relative to existing building inventory.
     [2] Proposition D language notes that the revenue available will be incremental payroll tax revenues. This table includes several assumptions which render the calculation a conservative one.
     [3] Based on the Bureau of Labor Statistics (BLS) data for the Office and Administrative Support Occupations' annual wage average in the San Francisco-Oakland-Fremont MSA (SF-Oak-Frem).
     [4] Based on the BLS for the Life, Physical, and Social Science Occupations' annual wage average in the SF-Oak-Frem.
     [5] Based on the BLS data for the Healthcare Practitioner and Technical Occupations and Healthcare Support sectors' annual wage average in the SF-Oak-Frem.
     [6] Based on the BLS data for the Office and Administrative Support, Business and Financial Operations, Computer and Mathematical Science, Architecture and Engineering, and
       Legal sectors' annual wage weighted average in the SF-Oak-Frem.
     [7] 80% of the overall payroll is assumed to be subject to payroll tax as clean energy technology sector, jobs partially located in other jurisdictions, and jobs with incomes below the threshold for the
       payroll tax are exempt from the payroll tax ordinance.
     [8] The biotech industry is exempt from the payroll tax ordinance for the first 7 years a company is located in San Francisco. For the purposes of modeling the amount of payroll taxes biotech companies
       at Pier 70 may contribute, a payroll tax "discount" of 50% is applied to the first 7 years of the program (this assumes that half of the biotech companies at Pier 70 will be exempt from the payroll tax).
       This discount is decreased to 30% for the remainder of the project buildout (with a 70% payroll tax payment rate), to account for tenants exhausting their 7 year exemption. The total payroll tax paid
       by biotech companies is lower than other uses based on the assumption that companies may move to the site while within their 7 year exemption period.
     Source: BLS, San Francisco Payroll Tax Ordinance, Economic & Planning Systems, Inc.

                                                                                                                                                                              P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010
     Table 13
     New Payroll Tax Calculation
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                  Total at                                                 Year Ending
     Project Item                                             Assumption                         Buildout         7               8              9              10             11               12               13

     Existing Buildings and Structures                                                            719,311          11,325         38,947          10,172         71,255             4,588       162,335           10,000
     New Buildings and Structures
     Biotech Office                                                                             1,268,437          74,614         74,614          74,614         74,614          74,614          74,614           74,614
     Medical Office                                                                               126,844               0              0               0              0               0               0                0
     General Office                                                                             1,141,594          67,153         67,153          67,153         67,153          67,153          67,153           67,153
       Total New Buildings and Structures                                                       2,536,875         141,767        141,767         141,767        141,767         141,767         141,767          141,767
     New Employment per year [1]
     Rehab. Buildings and Structures                        400   sf per employee                    1,798             28              97             25             178              11             406               25
       (less) existing employment [2]                       5%    of new employment                    -90             -1              -5             -1              -9              -1             -20               -1
     Biotech Office                                         425   sf per employee                    2,985            176             176            176             176             176             176              176
     Medical Office                                         350   sf per employee                      362              0               0              0               0               0               0                0
     General Office                                         315   sf per employee                    3,624            213             213            213             213             213             213              213
       Total Incremental Employment                                                                  8,679            416             481            413             558             400             774              412
     New Payroll (2009$)
     Rehab. Buildings and Structures [3]                $39,400   a year                     $70,852,134      $1,115,513      $3,836,280     $1,001,942      $7,018,618      $451,918       $15,989,998       $985,000
     Biotech Office [4]                                 $76,200   a year                    $227,423,342     $13,377,844     $13,377,844    $13,377,844     $13,377,844    $13,377,844      $13,377,844     $13,377,844
     Medical Office [5]                                 $60,200   a year                     $21,817,121              $0              $0             $0              $0             $0               $0              $0
     General Office [6]                                 $58,200   a year                    $210,922,998     $12,407,235     $12,407,235    $12,407,235     $12,407,235    $12,407,235      $12,407,235     $12,407,235
       Total Payroll                                                                        $531,015,594     $26,900,591     $29,621,358    $26,787,021     $32,803,696    $26,236,997      $41,775,076     $26,770,079
     New Payroll Subject to Payroll Tax
     Rehab. Buildings and Structures [7]                                                                              80%             80%            80%            80%             80%              80%              80%
     Biotech Office [8]                                                                                               50%             70%            70%            70%             70%              70%              70%
38




     Medical Office [7]                                                                                               80%             80%            80%            80%             80%              80%              80%
     General Office [7]                                                                                               80%             80%            80%            80%             80%              80%              80%
       Net Payroll Subject to Payroll Tax (2009$)                                           $278,965,869     $17,507,120     $22,359,302    $20,091,832     $24,905,173    $19,651,813      $32,082,277     $20,078,279

     New Payroll Tax Revenue (2009$)                       1.5% of net payroll                 $4,184,488      $262,607        $335,390       $301,377        $373,578       $294,777         $481,234         $301,174
     Cumulative Payroll Tax (2009$)                                                                           $2,096,958      $2,432,347     $2,733,725      $3,107,303     $3,402,080       $3,883,314       $4,184,488

     [1] Square feet per employee take into account the factors used in the Mission Bay SEIR. New office space is assumed to have higher-density employment ratio because of more modernized
       and efficient floor plans and design relative to existing building inventory.
     [2] Proposition D language notes that the revenue available will be incremental payroll tax revenues. This table includes several assumptions which render the calculation a conservative one.
     [3] Based on the Bureau of Labor Statistics (BLS) data for the Office and Administrative Support Occupations' annual wage average in the San Francisco-Oakland-Fremont MSA (SF-Oak-Frem).
     [4] Based on the BLS for the Life, Physical, and Social Science Occupations' annual wage average in the SF-Oak-Frem.
     [5] Based on the BLS data for the Healthcare Practitioner and Technical Occupations and Healthcare Support sectors' annual wage average in the SF-Oak-Frem.
     [6] Based on the BLS data for the Office and Administrative Support, Business and Financial Operations, Computer and Mathematical Science, Architecture and Engineering, and
       Legal sectors' annual wage weighted average in the SF-Oak-Frem.
     [7] 80% of the overall payroll is assumed to be subject to payroll tax as clean energy technology sector, jobs partially located in other jurisdictions, and jobs with incomes below the threshold for the
       payroll tax are exempt from the payroll tax ordinance.
     [8] The biotech industry is exempt from the payroll tax ordinance for the first 7 years a company is located in San Francisco. For the purposes of modeling the amount of payroll taxes biotech companies
       at Pier 70 may contribute, a payroll tax "discount" of 50% is applied to the first 7 years of the program (this assumes that half of the biotech companies at Pier 70 will be exempt from the payroll tax).
       This discount is decreased to 30% for the remainder of the project buildout (with a 70% payroll tax payment rate), to account for tenants exhausting their 7 year exemption. The total payroll tax paid
       by biotech companies is lower than other uses based on the assumption that companies may move to the site while within their 7 year exemption period.
     Source: BLS, San Francisco Payroll Tax Ordinance, Economic & Planning Systems, Inc.

                                                                                                                                                                              P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010
     Table 13
     New Payroll Tax Calculation
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                  Total at                                                   Year Ending
     Project Item                                             Assumption                         Buildout         14             15              16               17                  18                19              20

     Existing Buildings and Structures                                                            719,311          96,804               0               0                  0               37,707               0              0
     New Buildings and Structures
     Biotech Office                                                                             1,268,437          74,614         74,614          74,614             74,614              74,614                 0              0
     Medical Office                                                                               126,844               0              0               0                  0                   0                 0              0
     General Office                                                                             1,141,594          67,153         67,153          67,153             67,153              67,153                 0              0
       Total New Buildings and Structures                                                       2,536,875         141,767        141,767         141,767            141,767             141,767                 0              0
     New Employment per year [1]
     Rehab. Buildings and Structures                        400   sf per employee                    1,798             242              0               0                  0                  94                0              0
       (less) existing employment [2]                       5%    of new employment                    -90             -12              0               0                  0                  -5                0              0
     Biotech Office                                         425   sf per employee                    2,985             176            176             176                176                 176                0              0
     Medical Office                                         350   sf per employee                      362               0              0               0                  0                   0                0              0
     General Office                                         315   sf per employee                    3,624             213            213             213                213                 213                0              0
       Total Incremental Employment                                                                  8,679             619            389             389                389                 478                0              0
     New Payroll (2009$)
     Rehab. Buildings and Structures [3]                $39,400   a year                     $70,852,134      $9,535,194              $0              $0                 $0         $3,714,140                $0              $0
     Biotech Office [4]                                 $76,200   a year                    $227,423,342     $13,377,844     $13,377,844     $13,377,844        $13,377,844        $13,377,844                $0              $0
     Medical Office [5]                                 $60,200   a year                     $21,817,121              $0              $0              $0                 $0                 $0                $0              $0
     General Office [6]                                 $58,200   a year                    $210,922,998     $12,407,235     $12,407,235     $12,407,235        $12,407,235        $12,407,235                $0              $0
       Total Payroll                                                                        $531,015,594     $35,320,273     $25,785,079     $25,785,079        $25,785,079        $29,499,218                $0              $0
     New Payroll Subject to Payroll Tax
     Rehab. Buildings and Structures [7]                                                                               80%            80%             80%               80%                  80%             80%             80%
     Biotech Office [8]                                                                                                70%            70%             70%               70%                  70%             70%             70%
39




     Medical Office [7]                                                                                                80%            80%             80%               80%                  80%             80%             80%
     General Office [7]                                                                                                80%            80%             80%               80%                  80%             80%             80%
       Net Payroll Subject to Payroll Tax (2009$)                                           $278,965,869     $26,918,434     $19,290,279     $19,290,279        $19,290,279        $22,261,590                $0              $0

     New Payroll Tax Revenue (2009$)                       1.5% of net payroll                 $4,184,488      $403,777        $289,354        $289,354           $289,354            $333,924              $0              $0
     Cumulative Payroll Tax (2009$)                                                                           $4,588,265      $4,877,619      $5,166,973         $5,456,327          $5,790,251     $5,790,251      $5,790,251

     [1] Square feet per employee take into account the factors used in the Mission Bay SEIR. New office space is assumed to have higher-density employment ratio because of more modernized
       and efficient floor plans and design relative to existing building inventory.
     [2] Proposition D language notes that the revenue available will be incremental payroll tax revenues. This table includes several assumptions which render the calculation a conservative one.
     [3] Based on the Bureau of Labor Statistics (BLS) data for the Office and Administrative Support Occupations' annual wage average in the San Francisco-Oakland-Fremont MSA (SF-Oak-Frem).
     [4] Based on the BLS for the Life, Physical, and Social Science Occupations' annual wage average in the SF-Oak-Frem.
     [5] Based on the BLS data for the Healthcare Practitioner and Technical Occupations and Healthcare Support sectors' annual wage average in the SF-Oak-Frem.
     [6] Based on the BLS data for the Office and Administrative Support, Business and Financial Operations, Computer and Mathematical Science, Architecture and Engineering, and
       Legal sectors' annual wage weighted average in the SF-Oak-Frem.
     [7] 80% of the overall payroll is assumed to be subject to payroll tax as clean energy technology sector, jobs partially located in other jurisdictions, and jobs with incomes below the threshold for the
       payroll tax are exempt from the payroll tax ordinance.
     [8] The biotech industry is exempt from the payroll tax ordinance for the first 7 years a company is located in San Francisco. For the purposes of modeling the amount of payroll taxes biotech companies
       at Pier 70 may contribute, a payroll tax "discount" of 50% is applied to the first 7 years of the program (this assumes that half of the biotech companies at Pier 70 will be exempt from the payroll tax).
       This discount is decreased to 30% for the remainder of the project buildout (with a 70% payroll tax payment rate), to account for tenants exhausting their 7 year exemption. The total payroll tax paid
       by biotech companies is lower than other uses based on the assumption that companies may move to the site while within their 7 year exemption period.
     Source: BLS, San Francisco Payroll Tax Ordinance, Economic & Planning Systems, Inc.

                                                                                                                                                                               P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
     Economic & Planning Systems, Inc. 1/15/2010
Table 14
Proposition D Revenues (nominal $)
Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                 Year
Item                                                   Factor                      Total (Yrs 0-20)        0           1                2              3               4                 5                    6


Proposition D [1]
Payroll Tax [2]                                      75% of payroll tax                $74,351,358             $0    $152,500       $467,453         $685,724      $1,016,558         $1,302,424          $1,642,733
TOT                                                  75% of TOT revenue                         $0             $0          $0             $0               $0              $0                 $0                  $0
  Total                                                                                $74,351,358             $0    $152,500       $467,453         $685,724      $1,016,558         $1,302,424          $1,642,733

(Less) Issuance Cost @ 5.0%                                                           ($3,717,568)             $0     ($7,625)      ($23,373)       ($34,286)        ($50,828)         ($65,121)           ($82,137)
Net Annual Payments Available                                                         $70,633,790              $0    $144,875       $444,080        $651,438         $965,730         $1,237,303          $1,560,597
Net Bond Amt., 20-yr. term @ 6.0% [3]                                                 $48,678,446                           $0              $0              $0               $0     $48,678,446                      $0


[1] Proposition D is a City charter amendment passed by voters in 2008 which, in part, allows the Port to use net payroll taxes generated at Pier 70 improvements at the site, as described in the proposition.
[2] See Table 13 for details on employment projections.
[3] Assumed to be bonded against 75% of revenues generated between year 5 and 25.
  Formatting indicates year selected (for modeling purposes) in which a 20-year bond may be issues based on Proposition D revenues.
Source: Economic & Planning Systems, Inc.
 40




                                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
       Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                            Page 1 of 1
5.      COSTS


The development costs included in the financial feasibility analysis encompass the full suite of
improvements necessary to support new development, rehabilitate buildings, and provide a high-
level of public amenities. The costs include site preparation, environmental remediation,
infrastructure (new streets and utilities), parks, pier and wharf improvements, and historic
rehabilitation. All of the cost estimates include a factor for soft costs including planning,
entitlement and contingency.


Sitework and Waterfront Improvements

Sitework and waterfront improvement expenditures are related to demolition, new infrastructure,
environmental remediation, parks and open space, and piers and wharfs improvements. These
cost estimates are based on a number of sources:

•    Demolition. A small amount (170,000 square feet) of existing square footage is expected to
     be demolished. Demolition costs assume $25 in costs per building square foot. These costs
     are expected to be incurred relatively early in the cash flow, in years 2 through 4.

•    Infrastructure. In order to support the development intensity envisioned for Pier 70, new
     infrastructure is needed. New streets are needed to provide access into the site and
     circulation among its destination points. To provide this site access and circulation, 18th,
     19th and 22nd Streets are extended east onto the Pier 70 site while three new north-south
     streets will provide internal circulation and access to potential future development at the
     Mirant Potrero Plant site. In addition, 20th Street will be extended east to the Bay. New
     utilities including power, water, and sewer are also needed to support the site’s development.
     The estimated $46 million in costs for infrastructure for the site is estimated based on
     Mission Bay infrastructure costs which averaged $5,200 per linear feet of roadway. About
     two-thirds of the infrastructures costs are modeled early in the cash flow, in years 0 through
     4. The remaining one-third is spread out through year 9.

•    Parking structure. Costs to develop required separate parking structures are based on an
     estimated $25,000 per parking space.

•    Environmental remediation. Environmental remediation is in several places in the cost
     estimate. The line item in the cost tables is for the site remediation for development sites
     and is included at $15 million which is then increased to include soft costs. The park costs
     include related remediation. Treadwell & Rollo estimated costs and quantities for a range of
     potential soil and groundwater remediation scenarios, ranging from "low" to "high" extent of
     remediation required, and probability-weighted by the likelihood that we will implement
     various remediation measures. Those costs are estimated at $19 million for development
     sites and $9 million for park sites. Building rehabilitation costs ($350 million) include $45
     million for abatement of hazardous building materials such as lead-based paint and asbestos.
     In total, before soft costs, the model includes $66 million of costs to address hazardous
     materials.




Economic & Planning Systems, Inc.               41               P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
                                                                                     Pier 70 Feasibility Analysis
                                                                                          Final Report 01/13/10



•   Parks. Given the intensity of development envisioned at Pier 70 and the existing need for
    parks and open space in the Central Waterfront area of the City, Crane Cove Park, Slipway
    Park, and the plazas and courtyards located throughout the land use plan will provide an
    important amenity to employees and residents in the area. Costs for development of these
    spaces are estimated including remediation, site work, restoration of the historic cranes at
    Crane Cove Park, and an array of park features. Costs to develop parks are estimated at
    $1.5 million per acre with an additional $1 million in expenditures included for restoration of
    the cranes at Crane Cove Park. These costs were based on recently constructed Port of
    Oakland waterfront park projects at Union Point and the Cryer Boat Works sites.

    Roughly half of the costs of Crane Cove Park are incurred in year 1 using the Park Bond
    funds available. The remainder of the costs of that park is included in year 7. Other park
    costs are incurred in years 10, 13, and 15.

•   Plazas/Open Space. The development pads include areas of plazas and open space.
    These would be built as part of the development of each site with the sub-developer of the
    site incurring these costs, rather than the Master Developer. The cost of this open space is
    reflected in the vertical development proposals.

•   Piers/Wharfs. Expenditures totaling $45 million are included in the plan to stabilize and
    reconstruct portions of the old piers and wharfs at the site. This estimate is based on the
    Port’s 10-Year Capital Plan Fiscal Year 2008-2017 Update. These costs are projected to
    occur largely evenly from years 11 through buildout.


Rehabilitation and Adaptive Reuse

The rehabilitation and adaptive reuse of historic structures is one of the primary goals of the
Preferred Master Plan. Using the adaptive reuse program summarized in Table 9 to define the
needed upgrades, the consultant team (architects, engineers, and cost estimators) and Port staff
developed costs including historic preservation, seismic strengthening, mechanical and electrical
upgrades, other architectural work, and soft costs (planning, entitlement, and contingency).
These costs were based on field investigations and assessments of existing conditions as well as
expected scope of rehabilitation. For example, where appropriate, the team identified the
magnitude of new mezzanines to be added to buildings and included that in the cost program
and in the projections of revenues. The detail of the rehabilitation program and costs are
documented in the Conception Estimate of Probable Construction Cost Based on Assessment of
Building Conditions (Condition Survey Evaluation; July 3, 2008).

Costs estimates were based on the building conditions as investigated in 2008. Costs are
escalated at a rate of 3 percent per year to reflect construction cost inflation for the year in
which the rehab occurs. An additional cost increase factor of 1 percent per year was included to
reflect the fact that the costs of rehabilitating these buildings will increase faster than inflation
because of deterioration. One means to reduce the costs of historic rehabilitation may be early
investments in stabilization and weather proofing to forestall deterioration.

Building rehabilitation costs along with projected revenues by building and estimated historic tax
credits are shown in Table 15. The table calculates, in most cases, a shortfall between
capitalized revenues and rehabilitation costs. Table 16 arrays the feasibility shortfall in a cash



Economic & Planning Systems, Inc.                42                P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
                                                                                      Pier 70 Feasibility Analysis
                                                                                           Final Report 01/13/10



flow, illustrating when particular buildings are shown to be rehabilitated. As shown, roughly one
building per year is rehabilitated during years 1 through 18 with a priority on the 20th Street
corridor. In the final year of the cash flow used for the NPV and IRR calculations, the reversion
value of the ground lease and the rehabilitated buildings is included. This is estimated at the
capitalized value of the rehabilitated buildings annual lease revenues plus the capitalized value of
the annual ground lease value for new development. This assumes that the master developer
entity may sell its interest in the site and realize the residual value of the asset in year 30.


Ongoing Costs

Two ongoing costs are included in the annual cash flow projections: environmental remediation
monitoring and rent payments to the Port of San Francisco. Ongoing environmental monitoring
(e.g., ground water monitoring) and reporting is likely to be required as part of the final
remediation action plan and is estimated at $200,000 per year starting after the remediation
program is completed.

Rent to the Port of San Francisco is projected at $2.9 million per year—equivalent to the current
interim income from the site, excluding the ship repair leasehold. The terms of Proposition D
require the Port to demonstrate that even with investing new lease revenue and property tax
increment from the site into the project it requires additional public funding. It is likely that final
development agreement between the developer and the Port will have a more complex rent
structure than modeled herein.

The land lease and building rent projects are after the expenses of running the buildings. No
assumptions have been made about the ongoing costs of maintaining the parks and
infrastructure; either a community services district would fund these or they would be
maintained by the Port or the City.


Costs Excluded from Pier 70 Feasibility Analysis
The following costs were not included in the project pro forma:

•   Any off-site costs for infrastructure or transportation systems beyond those that would be
    supported by impact fees included in the project development cost pro formas. For example,
    no sewer system expansion is expected as a new pump station was built in the 1990s.
    Nearby roadway improvements are part of the City’s capital planning including plans for a
    general obligation bond.

•   Electrical substation additions, as the site is adjacent to an existing substation.

•   San Francisco Municipal Railway turn-around proposed at 19th Street including signalization
    of Illinois Street. These costs are included in the San Francisco Municipal Transportation
    Agencies capital plans.

•   The cost of the new Ferry Terminal shown in the Preferred Master Plan.




Economic & Planning Systems, Inc.                 43                P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
                                                                                  Pier 70 Feasibility Analysis
                                                                                       Final Report 01/13/10



•   Costs of upgrading facilities within the ship repair area with the exception of the
    rehabilitation of Building 111 and the construction of the new 19th Street access road.

•   Costs of interim improvements for surface parking prior to construction of parking garages.
    Revenues from surface parking are also not included during this time period.




Economic & Planning Systems, Inc.               44              P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                                 Building 101                                  Building 104
                                                                                     Summary - All Structures                           Bethlehem Steel Admin Building                        Office Building
     Item                                                                   Assumption   Per Sq. Ft.                    Total       Assumption  Per Sq. Ft.            Total       Assumption     Per Sq. Ft.                    Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                   Intended Use                                                                                       Office                                              Office
     Lease Up Year                                                             1-18                                                        1                                                   5
     Gross Building Area                                                    721,569 square feet                      721,569         56,268 square feet                56,268            37,641 square feet                     37,641
     Efficiency Ratio                                                           85%                                                     85%                                                 85%
     Net Building Area (Sq. Ft.)                                                                                     613,334                                           47,828                                                   31,995

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                                      $25.63      /sq. ft.               $15,721,882         $36.00     /sq. ft.            $1,721,801           $36.00      /sq. ft.              $1,151,815
     (less) Operating Expenses [1]                                                                                (1,641,321)                                       ($172,180)                                             ($115,181)
     (less) Leasing and Marketing                                                  6%                              ($943,313)             6%                        ($103,308)                 6%                           ($69,109)
     (less) Vacancy Rate                                                           4%                              ($628,875)             4%                         ($68,872)                 4%                           ($46,073)
        Subtotal                                                                                      $17        $12,508,372                                $24     $1,377,441                                   $24         $921,452

     Building Value (capitalized at 7.5%) [2]                                   7.5%                 $231      $166,778,298             7.5%               $326    $18,365,875              7.5%                $326     $12,286,022

     REHAB COSTS
     Hard Costs                                                                                                187,972,144                                         $14,560,000                                           $10,340,000
     HazMat Abatement, Soft Costs and Contingency [3]                            75%                           $140,979,108              75%                       $10,920,000               75%                          $7,755,000
       Total Costs [2]                                                                               $456      $328,951,253                                $453    $25,480,000                                  $481     $18,095,000
45




     (less) Historic Tax Credit                                                20.0% of rehab cost             ($65,790,251)           20.0% of rehab cost         ($5,096,000)            20.0% of rehab cost           ($3,619,000)

     Net Value                                                                                       ($134)    ($96,382,704)                               ($36)   ($2,018,125)                                 ($58) ($2,189,978)


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




                                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                             1 of 6
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                     Building 102                                    Building 2                                      Building 6
                                                                                    Powerhouse #1                                   Welding Shop                                  Light Warehouse
     Item                                                          Assumption       Per Sq. Ft.             Total        Assumption   Per Sq. Ft.              Total     Assumption   Per Sq. Ft.                 Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                 Intended Use                        Retail                                            Industrial/ Office                               Industrial / Other
     Lease Up Year                                                       2                                                    11                                               18
     Gross Building Area                                             8,424 square feet                      8,424         96,804 square feet                 96,804       37,707 square feet                    37,707
     Efficiency Ratio                                                  85%                                                   85%                                             85%
     Net Building Area (Sq. Ft.)                                                                            7,160                                            82,283                                             32,051

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                           $18.00     /sq. ft.                   $128,887         $21.00    /sq. ft.              $1,727,951     $15.00    /sq. ft.                   $480,764
     (less) Operating Expenses [1]                                                                       ($14,321)                                        ($172,795)                                          ($64,102)
     (less) Leasing and Marketing                                       6%                                ($7,733)             6%                         ($103,677)         6%                               ($28,846)
     (less) Vacancy Rate                                                4%                                ($5,155)             4%                          ($69,118)         4%                               ($19,231)
     Subtotal                                                                              $12           $101,678                                 $14     $1,382,361                             $10          $368,586

     Building Value (capitalized at 7.5%) [2]                         7.5%                $161         $1,355,702            7.5%                $190    $18,431,482        7.5%               $130         $4,914,479

     REHAB COSTS
     Hard Costs                                                                                        $2,580,000                                        $16,570,000                                      $11,630,000
     HazMat Abatement, Soft Costs and Contingency [3]                  75%                             $1,935,000            75%                         $12,427,500        75%                            $8,722,500
       Total Costs [2]                                                                    $536         $4,515,000                                $300    $28,997,500                           $540       $20,352,500
46




     (less) Historic Tax Credit                                      20.0% of rehab cost                ($903,000)         20.0% of rehab cost           ($5,799,500)      20.0% of rehab cost            ($4,070,500)

     Net Value                                                                            ($268)     ($2,256,298)                                ($49)   ($4,766,518)                         ($301) ($11,367,521)


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




                                                                                                                                                                                      P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                 2 of 6
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                         Building 110                                            Building 111                                       Building 52
                                                                       Yard Washroom                                            Warehouse #1                                        Plate Shop
     Item                                                     Assumption     Per Sq. Ft.             Total            Assumption         Per Sq. Ft.            Total    Assumption  Per Sq. Ft.                   Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                 Intended Use Retail / Other                                                      Office                                                 Industrial
     Lease Up Year                                   11                                                               10                                                        10
     Gross Building Area                         3,910 square feet                                   3,910       46,272 square feet                           46,272       24,983 square feet                    24,983
     Efficiency Ratio                              85%                                                              85%                                                       85%
     Net Building Area (Sq. Ft.)                                                                     3,324                                                    39,331                                             21,236

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                      $9.00     /sq. ft.                   $29,912       $20.25    /sq. ft.                         $796,457       $15.00   /sq. ft.                   $318,533
     (less) Operating Expenses [1]                                                                 ($6,647)                                                 ($79,646)                                          ($42,471)
     (less) Leasing and Marketing                                 6%                               ($1,795)           6%                                    ($47,787)          6%                              ($19,112)
     (less) Vacancy Rate                                          4%                               ($1,196)           4%                                    ($31,858)          4%                              ($12,741)
     Subtotal                                                                              $5      $20,273                                          $14     $637,165                              $10          $244,209

     Building Value (capitalized at 7.5%) [2]                   7.5%                       $69    $270,311          7.5%                           $184    $8,495,539        7.5%               $130         $3,256,118

     REHAB COSTS
     Hard Costs                                                                                  $1,040,000                                             $12,280,000                                          $5,036,220
     HazMat Abatement, Soft Costs and Contingen                 75%                                $780,000         75%                                  $9,210,000          75%                             $3,777,165
       Total Costs [2]                                                                    $465   $1,820,000                                        $464 $21,490,000                             $353         $8,813,386
47




     (less) Historic Tax Credit                               20.0% of rehab cost                ($364,000)       20.0% of rehab cost                     ($4,298,000)      20.0% of rehab cost            ($1,762,677)

     Net Value                                                                        ($303) ($1,185,689)                                         ($188) ($8,696,461)                          ($152)      ($3,794,591)


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




                                                                                                                                                                                    P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                               3 of 6
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                   Building 113 - 114                                   Building 115-116                                      Building 12
                                                                  UIW Machine Shop                                       Brass Foundry                                       Plate Shop #2
     Item                                                Assumption Per Sq. Ft.                  Total         Assumption     Per Sq. Ft.                 Total   Assumption Per Sq. Ft.                      Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                 Intended Use Institutional / Retail                                        Retail / Parking                                        Office
     Lease Up Year                                      4                                                               6                                               12
     Gross Building Area                       100,111 square feet                            100,111             73,734 square feet                     73,734   162,335 square feet                      162,335
     Efficiency Ratio                               85%                                                               85%                                             85%
     Net Building Area (Sq. Ft.)                                                               85,094                                                    62,674                                            137,985

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                  $20.00     /sq. ft.               $1,701,887            $14.63     /sq. ft.               $916,606       $36.00   /sq. ft.                    $4,967,451
     (less) Operating Expenses [1]                                                          ($170,189)                                            ($125,348)                                            ($496,745)
     (less) Leasing and Marketing                              6%                           ($102,113)                 6%                          ($54,996)           6%                               ($298,047)
     (less) Vacancy Rate                                       4%                            ($68,075)                 4%                          ($36,664)           4%                               ($198,698)
     Subtotal                                                                    $14        $1,361,510                                    $9        $699,597                            $24             $3,973,961

     Building Value (capitalized at 7.5%) [2]                7.5%               $181       $18,153,461               7.5%               $127      $9,327,965         7.5%              $326           $52,986,144

     REHAB COSTS
     Hard Costs                                                                            $28,630,000                                           $17,990,000                                          $48,250,000
     HazMat Abatement, Soft Costs and Conting                 75%                          $21,472,500                75%                        $13,492,500         75%                              $36,187,500
       Total Costs [2]                                                          $500       $50,102,500                                  $427     $31,482,500                           $520           $84,437,500
48




     (less) Historic Tax Credit                             20.0% of rehab cost           ($10,020,500)             20.0% of rehab cost         ($6,296,500)        20.0% of rehab cost             ($16,887,500)

     Net Value                                                                  ($219)    ($21,928,539)                                 ($215) ($15,858,035)                           ($90)        ($14,563,856)


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




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          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                   4 of 6
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                      Building 14                                             Building 21                                  Building 50
                                                                                    Granny's Movers                                  Electric Shop/Substation #5                      Beth Street Substation
     Item                                                                 Assumption Per Sq. Ft.                 Total          Assumption   Per Sq. Ft.              Total     Assumption Per Sq. Ft.                       Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                   Intended Use                            Office                                             Industrial / Retail                              Retail / Other
     Lease Up Year                                                              8                                                      9                                               11
     Gross Building Area                                                  38,947 square feet                    38,947          10,172 square feet                  10,172          678 square feet                            678
     Efficiency Ratio                                                        85%                                                   85%                                               85%
     Net Building Area (Sq. Ft.)                                                                                33,105                                                8,646                                                    576

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                                  $36.00     /sq. ft.               $1,191,778          $16.50     /sq. ft.               $142,662        $9.00    /sq. ft.                         $5,187
     (less) Operating Expenses [1]                                                                          ($119,178)                                            ($17,292)                                               ($1,153)
     (less) Leasing and Marketing                                              6%                            ($71,507)               6%                            ($8,560)          6%                                     ($311)
     (less) Vacancy Rate                                                       4%                            ($47,671)               4%                            ($5,706)          4%                                     ($207)
     Subtotal                                                                                    $24          $953,423                                   $11      $111,104                                 $5               $3,515

     Building Value (capitalized at 7.5%) [2]                                7.5%               $326      $12,712,301              7.5%                  $146    $1,481,382        7.5%                   $69              $46,872

     REHAB COSTS
     Hard Costs                                                                                           $12,300,000                                            $3,220,000                                              $320,000
     HazMat Abatement, Soft Costs and Contingency [3]                         75%                          $9,225,000               75%                          $2,415,000         75%                                  $240,000
       Total Costs [2]                                                                          $553      $21,525,000                                    $554    $5,635,000                             $826             $560,000
49




     (less) Historic Tax Credit                                            20.0% of rehab cost            ($4,305,000)            20.0% of rehab cost           ($1,127,000)      20.0% of rehab cost                  ($112,000)

     Net Value                                                                                  ($116)    ($4,507,699)                                ($298)    ($3,026,618)                           ($592)          ($401,128)


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




                                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                             5 of 6
     Table 15
     Adaptive Reuse Pro Formas
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                   Building 19                                                Building 103
                                                                                    Garage #1                                             Steam Powerhouse #2                                           Building Kneass
     Item                                                               Assumption Per Sq. Ft.              Total                 Assumption           Per Sq. Ft.        Total          Assumption       Per Sq. Ft.                      Total


     DEVELOPMENT PROGRAM ASSUMPTIONS
                                 Intended Use                          Industrial                                       Retail                                                         Office / Parking
     Lease Up Year                                                            13                                                       7                                                        7
     Gross Building Area                                                 10,000 square feet                10,000                  2,258 square feet                      2,258          11,325 square feet                           11,325
     Efficiency Ratio                                                       85%                                                      85%                                                     85%
     Net Building Area (Sq. Ft.)                                                                            8,500                                                         1,919                                                            9,626

     REVENUE ASSUMPTIONS
     Gross Revenue (NNN)                                                  $15.00     /sq. ft.            $127,500                    $18   /sq. ft.                     $34,547           $28.13      /sq. ft.                      $270,738
     (less) Operating Expenses [1]                                                                       ($17,000)                                                      ($3,839)                                                    ($27,074)
     (less) Leasing and Marketing                                              6%                         ($7,650)                    6%                                ($2,073)                6%                                  ($16,244)
     (less) Vacancy Rate                                                       4%                         ($5,100)                    4%                                ($1,382)                4%                                  ($10,830)
     Subtotal                                                                                   $10        $97,750                                             $12      $27,254                                     $19             $216,591

     Building Value (capitalized at 7.5%) [2]                                7.5%               $130    $1,303,333                  7.5%                     $161      $363,387               7.5%                $255            $2,887,875

     REHAB COSTS
     Hard Costs                                                                                         $1,131,624                                                     $484,900                                                   $1,609,400
     HazMat Abatement, Soft Costs and Contingency [3]                        75%                          $848,718                   75%                               $363,675               75%                                 $1,207,050
       Total Costs [2]                                                                          $198    $1,980,342                                           $376      $848,575                                   $249            $2,816,450
50




     (less) Historic Tax Credit                                            20.0% of rehab cost          ($396,068)                 20.0% of rehab cost                ($169,715)            20.0% of rehab cost                   ($563,290)

     Net Value                                                                                  ($28)   ($280,940)                                           ($140)   ($315,473)                                    $56            $634,715


     Note: the cost estimates exclude the additional deterioration factor of 1% a year.

     [1] Assumes the higher between 10% of gross revenues or $2.00 per square foot; reflects repair/maintenance, administrative, and leasing expenses.
     [2] Revenues and Costs shown on this table drive the model's treatment of these structures. If cost or revenue is "0," it indicates
       building's cost or revenue is assumed to be captured outside of this analysis. Revenues are based on Table 9 distribution of uses.
     [3] Includes Hazmat Abatement, Soft Costs (including impact fees ranging from $24 to $32 psf), and Contingency.

     Source: M Lee (cost estimator); ROMA Design; Port of San Francisco; Economic & Planning Systems




                                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
          Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                             6 of 6
     Table 16
     Rehabilitated Buildings Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                     Year
                             Building                    Total              0                    1               2               3                4                5                 6                 7


     Building Lease Revenue
     Lease Revenue (constant $) [1]                   $376,272,239              $0              $0    $1,377,441     $1,479,118        $1,479,118      $2,840,628        $3,762,080        $4,461,677
     Lease Revenue (nominal $) [1]                    $751,284,582              $0              $0    $1,461,327     $1,616,273        $1,664,761      $3,293,066        $4,492,120        $5,487,300

     Rehab Costs (constant 2009$) [2]
     Building 101                                      ($25,480,000)            $0 ($25,480,000)          $0                   $0           $0            $0            $0           $0
     Building 102                                       ($4,515,000)            $0           $0 ($4,515,000)                   $0           $0            $0            $0           $0
     Building 2                                        ($28,997,500)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 104                                      ($18,095,000)            $0           $0           $0                   $0           $0 ($18,095,000)            $0           $0
     Building 6                                        ($20,352,500)            $0           $0           $0                   $0           $0            $0            $0           $0
     Knease                                             ($2,816,450)            $0           $0           $0                   $0           $0            $0            $0 ($2,816,450)
     Building 110                                       ($1,820,000)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 111                                      ($21,490,000)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 52                                        ($8,813,386)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 113-114                                  ($50,102,500)            $0           $0           $0                   $0 ($50,102,500)           $0            $0           $0
     Building 115-116                                  ($31,482,500)            $0           $0           $0                   $0           $0            $0 ($31,482,500)           $0
51




     Building 12                                       ($84,437,500)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 14                                       ($21,525,000)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 21                                        ($5,635,000)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 19                                        ($1,980,342)            $0           $0           $0                   $0           $0            $0            $0           $0
     Building 50                                          ($560,000)            $0           $0           $0                   $0           $0            $0            $0           $0
     Other Buildings (rehab)                                     $0             $0           $0           $0                   $0           $0            $0            $0           $0
     Total (constant $)                               ($328,102,678)            $0 ($25,480,000) ($4,515,000)                  $0 ($50,102,500) ($18,095,000) ($31,482,500) ($2,816,450)
     Total with 1% Deterioration (constant $) [3]     ($355,060,817)            $0 ($25,480,000) ($4,560,150)                  $0 ($51,620,656) ($18,829,730) ($33,088,424) ($2,989,718)
     Total with 1% Deterioration (nominal $) [3]      ($468,115,064)            $0 ($26,244,400) ($4,837,863)                  $0 ($58,099,503) ($21,828,817) ($39,509,309) ($3,676,977)
       (Less) Historic Tax Credits (constant $) [4]     $71,012,163             $0   $5,096,000    $912,030                    $0 $10,324,131     $3,765,946    $6,617,685    $597,944
       (Less) Historic Tax Credits (nominal $) [4]      $93,623,013             $0   $5,248,880     $967,573                   $0 $11,619,901     $4,365,763    $7,901,862     $735,395
     Rehab Net Impact (constant $)                     $92,223,585              $0 ($20,384,000) ($2,270,679) $1,479,118 ($39,817,406) ($12,223,156) ($22,708,660) $2,069,902
     Rehab Net Impact (nominal $)                     $376,792,530              $0 ($20,995,520) ($2,408,964) $1,616,273 ($44,814,842) ($14,169,988) ($27,115,327) $2,545,719
     NPV (at 15%)                                     ($72,930,531)


                                                                       [1] Annual lease revenues for the year are shown for years 0-29. In year 30, lease revenues are capitalized at 10%.
                                                                       [2] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs.
                                                                       [3] Reflects an escalation cost of 1 percent due to deterioration starting in year 2.
                                                                       [4] Assumed at 20% of rehab cost.
                                                                       Source: Economic & Planning Systems




                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
     Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                             Page 1 of 4
     Table 16
     Rehabilitated Buildings Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                      Year
                             Building                    Total                    8               9               10             11                 12               13                 14                  15


     Building Lease Revenue
     Lease Revenue (constant $) [1]                   $376,272,239     $4,599,633      $5,553,056       $5,664,159      $6,545,533        $6,569,322      $10,543,283       $10,734,533        $12,116,894
     Lease Revenue (nominal $) [1]                    $751,284,582     $5,826,677      $7,245,478       $7,612,156      $9,060,549        $9,366,283      $15,483,167       $16,236,944        $18,877,726

     Rehab Costs (constant 2009$) [2]
     Building 101                                      ($25,480,000)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Building 102                                       ($4,515,000)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Building 2                                        ($28,997,500)           $0           $0            $0           $0                         $0               $0 ($28,997,500)                        $0
     Building 104                                      ($18,095,000)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Building 6                                        ($20,352,500)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Knease                                             ($2,816,450)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Building 110                                       ($1,820,000)           $0           $0            $0 ($1,820,000)                         $0               $0            $0                        $0
     Building 111                                      ($21,490,000)           $0           $0 ($21,490,000)           $0                         $0               $0            $0                        $0
     Building 52                                        ($8,813,386)           $0           $0 ($8,813,386)            $0                         $0               $0            $0                        $0
     Building 113-114                                  ($50,102,500)           $0           $0            $0           $0                         $0               $0            $0                        $0
     Building 115-116                                  ($31,482,500)           $0           $0            $0           $0                         $0               $0            $0                        $0
52




     Building 12                                       ($84,437,500)           $0           $0            $0           $0               ($84,437,500)              $0            $0                        $0
     Building 14                                       ($21,525,000) ($21,525,000)          $0            $0           $0                         $0               $0            $0                        $0
     Building 21                                        ($5,635,000)           $0 ($5,635,000)            $0           $0                         $0               $0            $0                        $0
     Building 19                                        ($1,980,342)           $0           $0            $0           $0                         $0      ($1,980,342)           $0                        $0
     Building 50                                          ($560,000)           $0           $0            $0    ($560,000)                        $0               $0            $0                        $0
     Other Buildings (rehab)                                     $0            $0           $0            $0           $0                         $0               $0            $0                        $0
     Total (constant $)                               ($328,102,678) ($21,525,000) ($5,635,000) ($30,303,386) ($2,380,000)              ($84,437,500)     ($1,980,342) ($28,997,500)                       $0
     Total with 1% Deterioration (constant $) [3]     ($355,060,817) ($23,077,713) ($6,101,898) ($33,142,366) ($2,629,001) ($94,204,246)                  ($2,231,499) ($33,001,860)                       $0
     Total with 1% Deterioration (nominal $) [3]      ($468,115,064) ($29,234,157) ($7,961,592) ($44,540,569) ($3,639,152) ($134,312,729)                 ($3,277,032) ($49,918,274)                       $0
       (Less) Historic Tax Credits (constant $) [4]     $71,012,163    $4,615,543 $1,220,380      $6,628,473    $525,800     $18,840,849                    $446,300     $6,600,372                        $0
       (Less) Historic Tax Credits (nominal $) [4]      $93,623,013    $5,846,831 $1,592,318      $8,908,114     $727,830    $26,862,546                     $655,406    $9,983,655                        $0
     Rehab Net Impact (constant $)                     $92,223,585 ($13,862,538)         $671,537 ($20,849,734) $4,442,333              ($68,794,075) $8,758,084 ($15,666,955) $12,116,894
     Rehab Net Impact (nominal $)                     $376,792,530 ($17,560,648)         $876,204 ($28,020,299) $6,149,228              ($98,083,901) $12,861,541 ($23,697,675) $18,877,726
     NPV (at 15%)                                     ($72,930,531)


                                                                     [1] Annual lease revenues for the year are shown for years 0-29. In year 30, lease revenues are capitalized at 10%.
                                                                     [2] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs.
                                                                     [3] Reflects an escalation cost of 1 percent due to deterioration starting in year 2.
                                                                     [4] Assumed at 20% of rehab cost.
                                                                     Source: Economic & Planning Systems




                                                                                                                                                                P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
     Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                           Page 2 of 4
     Table 16
     Rehabilitated Buildings Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                       Year
                             Building                    Total                     16               17               18               19               20                21                 22                 23


     Building Lease Revenue
     Lease Revenue (constant $) [1]                   $376,272,239      $12,116,894      $12,116,894      $12,116,894      $12,485,480      $12,485,480      $12,485,480       $12,485,480        $12,485,480
     Lease Revenue (nominal $) [1]                    $751,284,582      $19,444,058      $20,027,380      $20,628,201      $21,893,365      $22,550,166      $23,226,671       $23,923,471        $24,641,175

     Rehab Costs (constant 2009$) [2]
     Building 101                                      ($25,480,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 102                                       ($4,515,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 2                                        ($28,997,500)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 104                                      ($18,095,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 6                                        ($20,352,500)               $0               $0 ($20,352,500)                  $0               $0                $0                 $0                 $0
     Knease                                             ($2,816,450)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 110                                       ($1,820,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 111                                      ($21,490,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 52                                        ($8,813,386)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 113-114                                  ($50,102,500)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 115-116                                  ($31,482,500)               $0               $0           $0                   $0               $0                $0                 $0                 $0
53




     Building 12                                       ($84,437,500)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 14                                       ($21,525,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 21                                        ($5,635,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 19                                        ($1,980,342)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Building 50                                          ($560,000)               $0               $0           $0                   $0               $0                $0                 $0                 $0
     Other Buildings (rehab)                                     $0                $0               $0           $0                   $0               $0                $0                 $0                 $0
     Total (constant $)                               ($328,102,678)               $0               $0 ($20,352,500)                  $0               $0                $0                 $0                 $0
     Total with 1% Deterioration (constant $) [3]     ($355,060,817)               $0               $0 ($24,103,556)                  $0               $0                $0                 $0                 $0
     Total with 1% Deterioration (nominal $) [3]      ($468,115,064)               $0               $0 ($41,034,691)                  $0               $0                $0                 $0                 $0
       (Less) Historic Tax Credits (constant $) [4]     $71,012,163                $0               $0   $4,820,711                   $0               $0                $0                 $0                 $0
       (Less) Historic Tax Credits (nominal $) [4]      $93,623,013                $0               $0   $8,206,938                   $0               $0                $0                 $0                 $0
     Rehab Net Impact (constant $)                     $92,223,585 $12,116,894           $12,116,894 ($7,165,951) $12,485,480               $12,485,480      $12,485,480       $12,485,480        $12,485,480
     Rehab Net Impact (nominal $)                     $376,792,530 $19,444,058           $20,027,380 ($12,199,551) $21,893,365              $22,550,166      $23,226,671       $23,923,471        $24,641,175
     NPV (at 15%)                                     ($72,930,531)


                                                                       [1] Annual lease revenues for the year are shown for years 0-29. In year 30, lease revenues are capitalized at 10%.
                                                                       [2] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs.
                                                                       [3] Reflects an escalation cost of 1 percent due to deterioration starting in year 2.
                                                                       [4] Assumed at 20% of rehab cost.
                                                                       Source: Economic & Planning Systems




                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
     Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                             Page 3 of 4
     Table 16
     Rehabilitated Buildings Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                Year
                             Building                    Total                     24               25               26                27              28                29                  30


     Building Lease Revenue
     Lease Revenue (constant $) [1]                   $376,272,239      $12,485,480      $12,485,480      $12,485,480      $12,485,480      $12,485,480      $12,485,480       $124,854,801
     Lease Revenue (nominal $) [1]                    $751,284,582      $25,380,410      $26,141,823      $26,926,077      $27,733,860      $28,565,875      $29,422,852       $303,055,372

     Rehab Costs (constant 2009$) [2]
     Building 101                                      ($25,480,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 102                                       ($4,515,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 2                                        ($28,997,500)               $0               $0               $0                $0              $0                $0                  $0
     Building 104                                      ($18,095,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 6                                        ($20,352,500)               $0               $0               $0                $0              $0                $0                  $0
     Knease                                             ($2,816,450)               $0               $0               $0                $0              $0                $0                  $0
     Building 110                                       ($1,820,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 111                                      ($21,490,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 52                                        ($8,813,386)               $0               $0               $0                $0              $0                $0                  $0
     Building 113-114                                  ($50,102,500)               $0               $0               $0                $0              $0                $0                  $0
     Building 115-116                                  ($31,482,500)               $0               $0               $0                $0              $0                $0                  $0
54




     Building 12                                       ($84,437,500)               $0               $0               $0                $0              $0                $0                  $0
     Building 14                                       ($21,525,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 21                                        ($5,635,000)               $0               $0               $0                $0              $0                $0                  $0
     Building 19                                        ($1,980,342)               $0               $0               $0                $0              $0                $0                  $0
     Building 50                                          ($560,000)               $0               $0               $0                $0              $0                $0                  $0
     Other Buildings (rehab)                                     $0                $0               $0               $0                $0              $0                $0                  $0
     Total (constant $)                               ($328,102,678)               $0               $0               $0                $0              $0                $0                  $0
     Total with 1% Deterioration (constant $) [3]     ($355,060,817)               $0               $0               $0                $0              $0                $0                  $0
     Total with 1% Deterioration (nominal $) [3]      ($468,115,064)               $0               $0               $0                $0              $0                $0                  $0
       (Less) Historic Tax Credits (constant $) [4]     $71,012,163                $0               $0               $0                $0              $0                $0                  $0
       (Less) Historic Tax Credits (nominal $) [4]      $93,623,013                $0               $0               $0                $0              $0                $0                  $0
     Rehab Net Impact (constant $)                     $92,223,585 $12,485,480           $12,485,480      $12,485,480      $12,485,480      $12,485,480      $12,485,480       $124,854,801
     Rehab Net Impact (nominal $)                     $376,792,530 $25,380,410           $26,141,823      $26,926,077      $27,733,860      $28,565,875      $29,422,852       $303,055,372
     NPV (at 15%)                                     ($72,930,531)


                                                                       [1] Annual lease revenues for the year are shown for years 0-29. In year 30, lease revenues are capitalized at 10%.
                                                                       [2] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs.
                                                                       [3] Reflects an escalation cost of 1 percent due to deterioration starting in year 2.
                                                                       [4] Assumed at 20% of rehab cost.
                                                                       Source: Economic & Planning Systems




                                                                                                                                                                  P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
     Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                             Page 4 of 4
6.        FEASIBILITY RESULTS


Financial Feasibility Analysis

This section presents an assessment of the financial feasibility of the Pier 70 development. It
incorporates the best available data on infrastructure and historic rehabilitation costs, and
development phasing, market absorption, and financial assumptions derived from market studies
and relevant data sources. It also makes assumptions regarding the availability of public funding
sources, some of which will require special legislation or amendments to City policies and
statutes, as discussed above.

The cash flow model used for this analysis represents the financial performance of the project
from a master developer’s perspective because private sector investment will be necessary to
successfully complete the project. For Pier 70 to attract investment necessary for this project,
there must be a return on that investment commensurate with the risks incurred by the
developer.


Summary of Investments and Returns

The realization of the Pier 70 Master Plan will require a substantial outlay of capital. Including all
costs and contingencies associated with preparing the land for new development, rehabilitating
the existing buildings included in the land use program, and environmental monitoring and other
ongoing costs, expenditures total $655 million, in constant, 2009 dollars. Including inflation in
this estimate puts the total at $800 million. Without the infusion of public financing, the building
revenues and ground lease revenues do not generate a return on the expenditure investment
sufficient to attract private capital to this project. On a constant dollars basis, including public
financing sources in the cashflow including IFD, CFD, payroll tax, and historic tax credits results
in positive net revenues of $163 million. Including a discount rate to reflect the risk adjusted,
time value of money however, results in a negative financial result, with the NPV of the project
totaling negative $47 million.6 This result indicates that a feasible project will require additional
public or philanthropic funding or lower cost financing mechanisms.

Table 17 summarizes the results of this analysis. The table illustrates the various revenues,
costs, and public financing mechanisms on a net present value (NPV) basis, in total nominal
dollars over the 30-year period, and in constant 2009 dollars. As shown, the revenues over time
compared with total costs return a project IRR of 10 percent and an NPV of negative $46.8
million (assuming a 15 percent discount rate, over a 30-year period). This IRR represents a
“blended” return to debt and equity funding the project. It is likely that leveraged returns to
equity differ from returns to debt; actual returns will depend on the specific mix, type of funding,
and timing of borrowing. The resulting project IRR is below a typical range of “feasible” projects
which range from 15 to 25 percent.




6   15 percent discount rate, over 30-years.




Economic & Planning Systems, Inc.                55                P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
                                                                                  Pier 70 Feasibility Analysis
                                                                                       Final Report 01/13/10



Table 18 provides detailed project revenues, expenditures, and outside funding and public
financing arrayed over a 30-year period. In addition to the various totals shown in the cash flow,
the final row which reports the cumulative cash flow is an important feature of the analysis. As
shown, in year 12 the cumulative cash investment reaches $166 million before revenues begin to
outpace costs. The magnitude of equity investments at any given point in time will also depend
on the developers’ investment horizon, business model, and other factors. Many complex master
development projects create structures to spread investment risk over many parties.




Economic & Planning Systems, Inc.              56               P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
Table 17
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                                          NPV (at 15%)                    $2009 Summary
                                                                                                                        [1]                              [2]


REVENUES
New Construction Ground Lease Revenue                                                                          $56,016,522                       $308,372,523
Interim Leasing Income                                                                                         $10,623,793                        $15,950,000
Proposition A Park Bond                                                                                        $10,000,000                        $10,000,000
Infrastructure Financing District Bond (65% of T.I.)                                                           $29,883,663                        $95,708,617
Infrastructure Financing Pay As You Go                                                                          $4,014,704                        $15,454,140
   Total Revenues                                                                                             $110,538,682                       $445,485,280
EXPENDITURES
Sitework Costs
Demolition                                                                                                      $3,114,795                         $4,317,725
Infrastructure                                                                                                 $32,076,218                        $46,000,000
Structured Parking                                                                                              $4,876,368                        $23,921,635
   Subtotal                                                                                                    $40,067,382                        $74,239,360
Waterfront Improvements
Remediation                                                                                                    $11,590,520                        $15,000,000
Park Space and Open Space                                                                                      $12,661,348                        $22,874,663
Piers/Wharfs                                                                                                    $7,866,045                        $45,000,000
  Subtotal                                                                                                     $32,117,914                        $82,874,663
Soft Costs
Planning & Entitlement                                                                                          $5,609,265                         $9,855,701
Project Management                                                                                              $2,887,412                         $6,284,561
Contingency                                                                                                    $14,437,059                        $31,422,805
  Subtotal                                                                                                     $22,933,736                        $47,563,067
Subtotal Sitework, Waterfront, and Soft Costs                                                                  $95,119,031                       $204,677,089
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                                $148,633,125                       $355,060,817
(Less) Historic Tax Credits                                                                                   ($29,726,625)                      ($71,012,163)
(Less) Historic Building Lease Revenue                                                                        ($45,975,969)                     ($263,902,918)
  Subtotal                                                                                                     $72,930,531                        $20,145,735
Ongoing Remediation Monitoring                                                                                    $889,236                          $4,600,000
Base Rent To The Port                                                                                          $24,935,963                        $87,000,000
   Total Expenditures                                                                                         $193,874,761                       $316,422,824
NET REVENUE BEFORE PROP D (See Note)                                                                          ($83,336,079)                      $129,062,456
IRR                                                                                   8.2%

PROP D Bond                                                                                                    $24,201,791                        $41,990,455

NET REVENUE AFTER PROP D                                                                                      ($59,134,287)                      $171,052,911
IRR                                                                                   9.5%
CFD Public Financing
Mello-Roos CFD                                                                                                 $25,960,603                        $83,796,470
(Less) CFD Value Reduction @ 75%                                                                              ($13,065,329)                      ($88,300,898)
   Value of CFD                                                                                                $12,895,274                        ($4,504,429)
NET REVENUE AFTER CFD FINANCING                                                                               ($46,239,013)                      $166,548,483
IRR                                                                                  10.2%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                                   ($165)

Note: This table provides details supporting Table 3. Here, revenues and costs are arranged in a particular order to arrive at the 'New Revenue Before
Prop D' subtotal.
[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing
  remediation monitoring and base rent to Port are excluded.
Source: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/15/2010                                                                 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls

                                                                                          57
     Table 18
     Development Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #17007

                                                                                                                                                                        Year
     Item                                                               Factor      Total (Yrs 0-30)       0                1               2              3              4                5                6                    7                     8

     REVENUES
     Rehabilitated Building Lease plus reversion value (2009$) [1]                    $376,272,239               $0              $0      $1,377,441      $1,479,118     $1,479,118      $2,840,628      $3,762,080            $4,461,677            $4,599,633
     New Construction Ground Lease plus reversion value (2009$) [2]                   $438,172,337               $0       $323,899       $1,458,058      $2,268,317     $3,078,576      $3,888,835      $4,699,094            $5,509,353            $6,319,612
     Interim Leasing Income (2009$) [3]                                                $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000     $2,030,000      $1,740,000      $1,450,000            $1,160,000             $870,000
     Proposition A Park Bond (2009$)                                                   $10,000,000      $10,000,000              $0              $0              $0             $0              $0                 $0                    $0                     $0
       Total Revenues (2009$)                                                        $840,394,576       $10,000,000      $3,223,899      $5,445,498      $6,067,435     $6,587,694      $8,469,463      $9,911,173          $11,131,030           $11,789,245
       Total Revenues (inflated)                          3.0% /yr                  $1,650,111,713      $10,000,000      $3,320,616      $5,777,129      $6,630,050     $7,414,508      $9,818,428     $11,834,459          $13,689,763           $14,934,262

     EXPENDITURES
     Sitework Costs (2009$)
     Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242     $1,439,242              $0              $0                    $0                    $0
     Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333     $6,133,333      $3,066,667      $3,066,667            $3,066,667            $3,066,667
     Structured Parking [5]                                657 spaces                  $23,921,635               $0              $0              $0              $0             $0              $0              $0                    $0                    $0
        Subtotal                                                                       $74,239,360       $6,133,333      $6,133,333      $7,572,575      $7,572,575     $7,572,575      $3,066,667      $3,066,667            $3,066,667            $3,066,667
     Waterfront Improvements (2009$)
     Remediation                                                                       $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000     $2,500,000      $2,500,000                 $0                 $0                        $0
     Park Space and Open Space                                                         $22,874,663       $7,751,940              $0              $0              $0             $0              $0                 $0         $6,033,769                        $0
     Piers/Wharfs                                                                      $45,000,000               $0              $0              $0              $0             $0              $0                 $0                 $0                        $0
       Subtotal                                                                        $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000     $2,500,000      $2,500,000                 $0         $6,033,769                        $0
     Total Development Cost (2009$)                                                   $157,114,023      $16,385,273      $8,633,333     $10,072,575     $10,072,575    $10,072,575      $5,566,667      $3,066,667            $9,100,435            $3,066,667
     Soft Costs (constant 2009$)
     Planning & Entitlement [6]                            5% of development cost       $9,855,701       $2,819,264       $431,667        $503,629        $503,629       $503,629        $278,333         $153,333             $455,022               $153,333
     Project Management                                    4% of development cost       $6,284,561        $655,411        $345,333        $402,903        $402,903       $402,903        $222,667         $122,667             $364,017               $122,667
     Contingency                                          20% of development cost      $31,422,805       $3,277,055      $1,726,667      $2,014,515      $2,014,515     $2,014,515      $1,113,333        $613,333            $1,820,087              $613,333
       Subtotal                                                                        $47,563,067       $6,751,729      $2,503,667      $2,921,047      $2,921,047     $2,921,047      $1,614,333        $889,333            $2,639,126              $889,333
     Rehabilitated Building Feasibility Gap
     Rehabilitation [7]                                                              $355,060,817               $0     $25,480,000      $4,560,150              $0     $51,620,656    $18,829,730     $33,088,424            $2,989,718          $23,077,713
     (Less) Historic Tax Credits                          20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0    ($10,324,131)   ($3,765,946)    ($6,617,685)            ($597,944)         ($4,615,543)
       Subtotal                                                                      $284,048,654               $0     $20,384,000      $3,648,120              $0     $41,296,525    $15,063,784     $26,470,739            $2,391,775          $18,462,171
58




     Ongoing Remediation Monitoring (2009$) [1]                                         $6,600,000              $0               $0              $0              $0             $0              $0                 $0           $200,000              $200,000
     Base Rent To The Port (2009$) [1]                                                $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000     $2,900,000      $2,900,000      $2,900,000            $2,900,000            $2,900,000
       Total Expenditures (2009$)                                                     $608,425,743      $23,137,002     $34,421,000     $19,541,742     $15,893,622    $57,190,146     $25,144,784     $33,326,739          $17,231,336           $25,518,171
       Total Expenditures (inflated)                      3.0% /yr                   $867,085,313       $23,137,002     $35,453,630     $20,731,834     $17,367,390    $64,368,014     $29,149,696     $39,793,869          $21,192,370           $32,325,655
     Required Public Financing (inflated)
     IFD Bond (65% of T.I.) (inflated) [8]                                            $137,760,908               $0              $0              $0      $3,014,828     $6,583,664      $4,947,411      $6,538,570            $6,403,289            $6,480,593
     IFD Pay As You Go (inflated)                                                      $23,096,190               $0              $0         $60,840       $193,700       $293,540        $425,490        $554,710              $685,490               $811,850
       Total IFD Proceeds (inflated)                                                  $160,857,098               $0              $0         $60,840      $3,208,528     $6,877,204      $5,372,901      $7,093,280            $7,088,779            $7,292,443
     NET REVENUE BEFORE PROP D                                                        $943,883,498     ($13,137,002)   ($32,133,014)   ($14,893,865)    ($7,528,811) ($50,076,302) ($13,958,367) ($20,866,130)        ($413,828) ($10,098,950)
     CUMULATIVE                                                                                        ($13,137,002)   ($45,270,016)   ($60,163,880)   ($67,692,691) ($117,768,994) ($131,727,360) ($152,593,490) ($153,007,319) ($163,106,269)

     PROP D
     Bond Proceeds (inflated) [9]                                                      $48,678,446               $0              $0              $0              $0             $0     $48,678,446                 $0                    $0                     $0
     Public Financing Available Now
     Grants                                                                                     $0               $0              $0              $0              $0             $0              $0               $0                   $0                    $0
     Mello-Roos CFD (inflated)                                                        $120,938,294               $0              $0              $0      $1,755,093     $6,434,940      $4,893,655       $5,133,424           $5,382,245            $5,640,427
     (Less) CFD Value Reduction @ 75% [10]                                          ($162,572,252)               $0              $0              $0      ($121,264)     ($565,869)      ($903,984)     ($1,258,665)         ($1,630,537)          ($2,020,248)
       Total Public Financing (inflated)                                             ($41,633,958)               $0              $0              $0      $1,633,830     $5,869,071      $3,989,671       $3,874,759           $3,751,708            $3,620,179
     NET REVENUE AFTER PROP D AND CFD [11]                                            $950,927,987     ($13,137,002)   ($32,133,014)   ($14,893,865)    ($5,894,981) ($44,207,232)     $38,709,751    ($16,991,371)         $3,337,880           ($6,478,771)
     CUMULATIVE                                                                                        ($13,137,002)   ($45,270,016)   ($60,163,880)   ($66,058,862) ($110,266,094)   ($71,556,342)   ($88,547,713)       ($85,209,834)         ($91,688,605)




                                                                                                                                                                                                      P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                           Page 1 of 4
     Table 18
     Development Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #1700

                                                                                                                                            Year
     Item                                                              9              10              11              12             13               14             15              16              17              18                     19

     REVENUES
     Rehabilitated Building Lease plus reversion value (2           $5,553,056      $5,664,159      $6,545,533      $6,569,322    $10,543,283      $10,734,533    $12,116,894     $12,116,894     $12,116,894     $12,116,894           $12,485,480
     New Construction Ground Lease plus reversion valu              $7,129,871      $7,940,130      $8,750,389      $9,560,648    $10,370,907      $11,181,166    $11,991,425     $12,801,684     $13,611,943     $14,422,202           $14,422,202
     Interim Leasing Income (2009$) [3]                              $580,000        $290,000               $0              $0             $0               $0             $0              $0              $0              $0                    $0
     Proposition A Park Bond (2009$)                                        $0              $0              $0              $0             $0               $0             $0              $0              $0                 $0                     $0
       Total Revenues (2009$)                                      $13,262,926     $13,894,289     $15,295,922     $16,129,970    $20,914,190      $21,915,699    $24,108,319     $24,918,578     $25,728,837     $26,539,096           $26,907,682
       Total Revenues (inflated)                          3.0%     $17,305,110     $18,672,762     $21,173,133     $22,997,480    $30,713,193      $33,149,461    $37,559,975     $39,987,002     $42,525,847     $45,181,034           $47,182,783

     EXPENDITURES
     Sitework Costs (2009$)
     Demolition                                                             $0              $0              $0              $0             $0               $0             $0              $0              $0                 $0                     $0
     Infrastructure [4]                                             $3,066,667              $0              $0              $0             $0               $0             $0              $0              $0                 $0                     $0
     Structured Parking [5]                                657              $0              $0              $0      $7,973,878             $0               $0     $7,973,878              $0      $7,973,878                 $0                     $0
        Subtotal                                                    $3,066,667              $0              $0      $7,973,878             $0               $0     $7,973,878              $0      $7,973,878                 $0                     $0
     Waterfront Improvements (2009$)
     Remediation                                                            $0              $0              $0              $0             $0               $0             $0              $0              $0              $0                     $0
     Park Space and Open Space                                              $0        $926,374              $0              $0     $5,275,624               $0     $2,886,956              $0              $0              $0                     $0
     Piers/Wharfs                                                           $0              $0      $4,500,000              $0     $4,500,000       $4,500,000     $4,500,000      $4,500,000      $4,500,000      $4,500,000             $4,500,000
       Subtotal                                                             $0        $926,374      $4,500,000              $0     $9,775,624       $4,500,000     $7,386,956      $4,500,000      $4,500,000      $4,500,000             $4,500,000
     Total Development Cost (2009$)                                 $3,066,667        $926,374      $4,500,000      $7,973,878     $9,775,624       $4,500,000    $15,360,834      $4,500,000     $12,473,878      $4,500,000             $4,500,000
     Soft Costs (constant 2009$)
     Planning & Entitlement [6]                            5%         $153,333         $46,319       $225,000        $398,694       $488,781         $225,000       $768,042        $225,000        $623,694        $225,000               $225,000
     Project Management                                    4%         $122,667         $37,055       $180,000        $318,955       $391,025         $180,000       $614,433        $180,000        $498,955        $180,000               $180,000
     Contingency                                          20%         $613,333        $185,275       $900,000       $1,594,776     $1,955,125        $900,000      $3,072,167       $900,000       $2,494,776       $900,000                $900,000
       Subtotal                                                       $889,333        $268,649      $1,305,000      $2,312,425     $2,834,931       $1,305,000     $4,454,642      $1,305,000      $3,617,425      $1,305,000             $1,305,000
     Rehabilitated Building Feasibility Gap
     Rehabilitation [7]                                             $6,101,898    $33,142,366      $2,629,001      $94,204,246     $2,231,499      $33,001,860             $0             $0              $0     $24,103,556                        $0
     (Less) Historic Tax Credits                          20%      ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)     ($446,300)     ($6,600,372)            $0             $0              $0     ($4,820,711)                       $0
       Subtotal                                                     $4,881,518    $26,513,893      $2,103,201      $75,363,397     $1,785,199      $26,401,488             $0             $0              $0     $19,282,845                        $0
59




     Ongoing Remediation Monitoring (2009$) [1]                       $200,000        $200,000        $200,000        $200,000       $200,000         $200,000       $200,000        $200,000        $200,000        $200,000               $200,000
     Base Rent To The Port (2009$) [1]                              $2,900,000      $2,900,000      $2,900,000      $2,900,000     $2,900,000       $2,900,000     $2,900,000      $2,900,000      $2,900,000      $2,900,000             $2,900,000
       Total Expenditures (2009$)                                  $11,937,518     $30,808,916     $11,008,201     $88,749,700     $17,495,754      $35,306,488    $22,915,476     $8,905,000     $19,191,303     $28,187,845            $8,905,000
       Total Expenditures (inflated)                      3.0%     $15,575,753     $41,404,607     $15,237,924    $126,535,851    $25,693,105      $53,404,231    $35,701,565    $14,289,911     $31,720,300     $47,987,919           $15,614,971
     Required Public Financing (inflated)
     IFD Bond (65% of T.I.) (inflated) [8]                          $6,261,567      $7,382,464      $6,751,154      $7,214,974     $7,279,393      $12,587,553     $8,142,613     $10,216,918      $8,767,482      $9,147,556            $9,540,515
     IFD Pay As You Go (inflated)                                    $960,830       $1,097,070      $1,242,670      $1,389,570     $1,643,590       $1,807,910     $2,014,090      $2,191,020      $2,375,620      $2,568,150            $2,780,050
       Total IFD Proceeds (inflated)                                $7,222,397      $8,479,534      $7,993,824      $8,604,544     $8,922,983      $14,395,463    $10,156,703     $12,407,938     $11,143,102     $11,715,706           $12,320,565
     NET REVENUE BEFORE PROP D                                      $8,951,754   ($14,252,310)   $13,929,034   ($94,933,827)   $13,943,071    ($5,859,308)   $12,015,113    $38,105,030    $21,948,649     $8,908,821                  $43,888,376
     CUMULATIVE                                                  ($154,154,515) ($168,406,826) ($154,477,792) ($249,411,619) ($235,468,548) ($241,327,856) ($229,312,743) ($191,207,713) ($169,259,064) ($160,350,243)               ($116,461,867)

     PROP D
     Bond Proceeds (inflated) [9]                                           $0              $0              $0              $0             $0               $0             $0              $0              $0                 $0                     $0
     Public Financing Available Now
     Grants                                                                  $0              $0              $0              $0             $0               $0             $0              $0              $0              $0                    $0
     Mello-Roos CFD (inflated)                                       $5,908,289      $6,186,159      $6,474,378      $6,773,297     $7,083,276       $7,404,691     $7,737,926      $8,083,381      $8,441,465      $8,812,604            $9,197,234
     (Less) CFD Value Reduction @ 75% [10]                         ($2,428,466)    ($2,855,882)    ($3,303,213)    ($3,771,197)   ($4,260,597)     ($4,772,205)   ($5,306,838)    ($5,865,338)    ($6,448,579)    ($7,057,463)          ($7,692,923)
       Total Public Financing (inflated)                             $3,479,823      $3,330,277      $3,171,165      $3,002,100     $2,822,679       $2,632,486     $2,431,089      $2,218,043      $1,992,886      $1,755,140            $1,504,312
     NET REVENUE AFTER PROP D AND CFD [11]                         $12,431,577    ($10,922,034)    $17,100,199   ($91,931,726)   $16,765,750    ($3,226,822)   $14,446,202        $40,323,073     $23,941,535     $10,663,962          $45,392,688
     CUMULATIVE                                                   ($79,257,028)   ($90,179,062)   ($73,078,863) ($165,010,589) ($148,244,840) ($151,471,662) ($137,025,459)      ($96,702,387)   ($72,760,852)   ($62,096,890)        ($16,704,203)




                                                                                                                                                                                                                     P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                                          Page 2 of 4
     Table 18
     Development Cash Flow
     Pier 70 Financial Feasibility Analysis; EPS #1700

                                                                                                                                               Year
     Item                                                            20              21             22              23              24                 25              26              27              28              29                      30

     REVENUES
     Rehabilitated Building Lease plus reversion value (2         $12,485,480     $12,485,480    $12,485,480     $12,485,480     $12,485,480      $12,485,480       $12,485,480     $12,485,480     $12,485,480     $12,485,480            $124,854,801
     New Construction Ground Lease plus reversion valu            $14,422,202     $14,422,202    $14,422,202     $14,422,202     $14,422,202      $14,422,202       $14,422,202     $14,422,202     $14,422,202     $14,422,202            $144,222,016
     Interim Leasing Income (2009$) [3]                                    $0              $0             $0              $0              $0               $0                $0              $0              $0              $0                      $0
     Proposition A Park Bond (2009$)                                       $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
       Total Revenues (2009$)                                     $26,907,682     $26,907,682    $26,907,682     $26,907,682     $26,907,682      $26,907,682       $26,907,682     $26,907,682     $26,907,682     $26,907,682            $269,076,817
       Total Revenues (inflated)                          3.0%    $48,598,266     $50,056,214    $51,557,901     $53,104,638     $54,697,777      $56,338,710       $58,028,871     $59,769,737     $61,562,830     $63,409,714            $653,120,059

     EXPENDITURES
     Sitework Costs (2009$)
     Demolition                                                            $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Infrastructure [4]                                                    $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Structured Parking [5]                                657             $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
        Subtotal                                                           $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Waterfront Improvements (2009$)
     Remediation                                                           $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Park Space and Open Space                                             $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Piers/Wharfs                                                  $9,000,000              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
       Subtotal                                                    $9,000,000              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Total Development Cost (2009$)                                $9,000,000              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Soft Costs (constant 2009$)
     Planning & Entitlement [6]                            5%       $450,000               $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Project Management                                    4%       $360,000               $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Contingency                                          20%      $1,800,000              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
       Subtotal                                                    $2,610,000              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Rehabilitated Building Feasibility Gap
     Rehabilitation [7]                                                   $0              $0              $0              $0              $0                 $0              $0              $0              $0                $0                        $0
     (Less) Historic Tax Credits                          20%             $0              $0              $0              $0              $0                 $0              $0              $0              $0                $0                        $0
       Subtotal                                                           $0              $0              $0              $0              $0                 $0              $0              $0              $0                $0                        $0
60




     Ongoing Remediation Monitoring (2009$) [1]                      $200,000        $200,000       $200,000        $200,000        $200,000           $200,000        $200,000        $200,000        $200,000        $200,000               $2,000,000
     Base Rent To The Port (2009$) [1]                             $2,900,000      $2,900,000     $2,900,000      $2,900,000      $2,900,000          $2,900,000     $2,900,000      $2,900,000      $2,900,000      $2,900,000              $29,000,000
       Total Expenditures (2009$)                                 $14,710,000      $3,100,000      $3,100,000      $3,100,000      $3,100,000      $3,100,000         $3,100,000      $3,100,000      $3,100,000      $3,100,000             $31,000,000
       Total Expenditures (inflated)                      3.0%   $26,567,896      $5,766,913      $5,939,921      $6,118,118      $6,301,662      $6,490,712         $6,685,433      $6,885,996      $7,092,576      $7,305,353             $75,245,137
     Required Public Financing (inflated)
     IFD Bond (65% of T.I.) (inflated) [8]                        $10,500,364              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     IFD Pay As You Go (inflated)                                          $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
       Total IFD Proceeds (inflated)                              $10,500,364              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     NET REVENUE BEFORE PROP D                                    $32,530,734     $44,289,301    $45,617,980     $46,986,519     $48,396,115     $49,847,998        $51,343,438     $52,883,742     $54,470,254     $56,104,361           $577,874,922
     CUMULATIVE                                                  ($83,931,133)   ($39,641,832)    $5,976,148     $52,962,667    $101,358,782    $151,206,781       $202,550,219    $255,433,961    $309,904,214    $366,008,576           $943,883,498

     PROP D
     Bond Proceeds (inflated) [9]                                          $0              $0             $0              $0              $0                 $0              $0              $0              $0                 $0                        $0
     Public Financing Available Now
     Grants                                                                 $0              $0             $0              $0              $0               $0                $0              $0              $0              $0                      $0
     Mello-Roos CFD (inflated)                                      $9,595,809              $0             $0              $0              $0               $0                $0              $0              $0              $0                      $0
     (Less) CFD Value Reduction @ 75% [10]                        ($8,355,921)    ($8,355,921)   ($8,355,921)    ($8,355,921)    ($8,355,921)     ($8,355,921)      ($8,355,921)    ($8,355,921)    ($8,234,657)    ($7,790,051)           ($19,436,912)
       Total Public Financing (inflated)                            $1,239,888    ($8,355,921)   ($8,355,921)    ($8,355,921)    ($8,355,921)     ($8,355,921)      ($8,355,921)    ($8,355,921)    ($8,234,657)    ($7,790,051)           ($19,436,912)
     NET REVENUE AFTER PROP D AND CFD [11]                       $33,770,622     $35,933,380     $37,262,059     $38,630,599     $40,040,194     $41,492,078        $42,987,518     $44,527,821     $46,235,597     $48,314,310           $558,438,010
     CUMULATIVE                                                  $17,066,419     $52,999,800     $90,261,859    $128,892,458    $168,932,653    $210,424,731       $253,412,249    $297,940,070    $344,175,667    $392,489,977           $950,927,987




                                                                                                                                                                                                                      P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
            Economic & Planning Systems, Inc. 1/15/2010                                                                                                                                                                                                           Page 3 of 4
     Table 18 Footnotes


     [1] Capitalized at 10%.
     [2] Assumes 8.5% of residual land value; capitalized at 10%.
     [3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
     [4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
     [5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
         1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
     [6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
     [7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
     [8] Infrastructure Financing District.
     [9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
     [10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
     [11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
       while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
       feasibility gap while on this table they are split among the revenues and expenditures sections.
     Formatting indicates year in which the highest, cumulative project deficit is expected.

     Source: Economic & Planning Systems, Inc
61




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                                                             Pier 70 Feasibility Analysis
                                                                  Final Report 01/13/10



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7.      SENSITIVITY TESTS


EPS conducted several sensitivity tests which evaluate the impact on the financial feasibility
results of additional funding, financing, land uses, and timing investments. As discussed earlier,
the base case project does not represent a feasible project (assuming a 15 percent blended rate
of return). The Port is exploring a number of opportunities for securing additional funding. These
sensitivities were designed to test how achieving a higher level of outside funding may impact
feasibility. The sensitivities tested and the results of the evaluation are summarized below.


Sensitivities Tested

Based on Port direction and discussion of potential alterations to the assumptions contained in
the base case financial feasibility analysis, EPS tested how changes to the base case would
impact the feasibility results. The sensitivities tested are described below in Table 19.

Table 19. Sensitivity Descriptions

Sensitivity Name               Sensitivity Description


Sensitivity 1–State            Includes the State’s 25.3 percent share of the tax increment above
Share of IFD                   the base case scenario assumption of 65 percent, to be available to
                               the project.

Sensitivity 2–Grant            Includes an additional public or philanthropic funds inflow to the
Funds, No Repayment            project of $40 million split between years 1 and 2.

Sensitivity 3–                 Includes an additional loan to the project at public sector debt rates
Additional Public Debt         of $40 million split between years 1 and 2 repaid, amortized over 30
with Repayment                 years with a 6 percent interest rate.

Sensitivity 4–Ground           Assumes that ground lease proceeds for 205,000 square feet of new
Lease Site: Rental             commercial uses in year 2 will be replaced by the same square
Residential                    footage of rental residential subject to a long-term ground lease.7

Sensitivity 5–Sell Site:       Assumes that ground lease proceeds for 205,000 square feet of new
For-Sale Residential           commercial uses in year 2 will be replaced by revenue from the sale
                               of land for an equivalently sized condominium development.




7 In order to maintain all of the other elements of the financial scenario while altering just the
development use—changing commercial square footage to residential square footage—the sensitivity
alters the use of the year 2 commercial development which totaled roughly 205,000 square feet in the
base case financial model.




Economic & Planning Systems, Inc.                 63                P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
                                                                                      Pier 70 Feasibility Analysis
                                                                                           Final Report 01/13/10



Table 19. Sensitivity Descriptions (continued)

Sensitivity Name               Sensitivity Description


Sensitivity 6–Sell Site:       Assumes that ground lease proceeds for 205,000 square feet of new
Commercial                     commercial uses in year 2 will be replaced by revenue from the sale
                               of land for commercial uses, including biotech, medical office, and
                               general office.

Sensitivity 7–Spread           Assumes that infrastructure, environmental remediation, and
Costs                          demolition costs (costs plus all soft costs) will be incurred a year
                               before new development, in proportion to the absorption of new
                               development square footage during the initial 15 years of the
                               project.



Results of Tests
Testing the seven sensitivities reveals potential options for improving the project’s NPV above
the 15 percent feasibility threshold. Table 20 illustrates the results of the tests.

Additional Funding Sensitivities. Sensitivities 1 (State Share of IFD), 2 (Additional Funds, No
Repayment, and 3 (Public Loan with Repayment) all improve the project NPV significantly.
Sensitivity2 which includes $40 million funding from sources outside of development at Pier 70,
generates the highest positive impact on the financial feasibility of the project, improving the
project NPV by $34 million. Including Sensitivities 1 and 3 in the cash flow also result in
significant improvements, adding $13 million and $18 million, respectively, to the Project’s NPV.

Cost Management. Sensitivity 7 (Spread Costs) also had a considerable impact on the
Project’s financials, improving the cashflow by more than $20 million by spreading infrastructure
and environmental remediation costs over a 15-year period. This shows that a more refined look
at the timing of costs could benefit the project pro forma. Similar gains to the project feasibility
may be possible by spending funds to stabilize historic buildings and then rehabbing them later
than the schedule included in this analysis. In particular, this could avoid the extraordinary cost
inflation included due to projected deterioration.

Land Use Change. One sensitivities tests land use changes. Sensitivity 4 (Ground Lease
Site 1: Rental Residential) tests a residential use on leased land. This alternative decreases the
project NPV due to the estimated lower value of residential uses at the site compared with
commercial uses. This affects the lease revenues and the projected assessed value and
associated property taxes.

Sale versus Lease. Two sensitivities, Sensitivities 5 (Sell Site 1: For-Sale Residential) and 6
(Sell Site 1: Commercial) test the sale of land for development. The parcel tested as a saleable
location is roughly equivalent to Site 1 in the site plan, the most northern parcel which is located
adjacent to Crane Cove Park’s northeast edge. The sale of the land for residential use compared
with leasing it for commercial uses results in an NPV decrease (Sensitivity 5)—due to the
estimated lower land value. The sale of land for commercial uses results in a modest



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                                                                                     Pier 70 Feasibility Analysis
                                                                                          Final Report 01/13/10




improvement in the project’s NPV of almost $2 million (Sensitivity 6). With commercial land
values estimated to be slightly higher than residential, the sale of land for residential uses also
negatively affects the CFD and IFD values, further decreasing the project NPV.




Economic & Planning Systems, Inc.                65                P:\17000s\17007Pier70\Report\Feas\17007FeasRpt_FINAL.doc
     Table 20
     Sensitivity Test Results
     Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                                                                        Change in NPV
     Scenario       Variation from Base Case                                                                       IRR               NPV               from Base Case
                                                                                                                                  ($millions)             ($millions)


     Base Case      --                                                                                               10.2%                 ($46.2)                       $0.0

     1              State Share of IFD                                                                               11.4%                 ($33.6)                     $12.6
                     (both in the bond and in the pay as you go revenues)
     2              Public Loan                                                                                      13.0%                 ($12.9)                     $33.4
                     ($20M in Year 1 $20 million in 2)
     3              Additional Public Debt with Repayment                                                            11.0%                 ($28.6)                     $17.6
                     ($20M in Year 1 and $20 in Year 2 with repayment over 30 years)
66




     4              Ground Lease Site: Rental Residential                                                              8.9%                ($63.7)                    ($17.4)
                     (equal to Base Case Year 2 new building square feet)
     5              Sell Site: For-Sale Residential                                                                    8.9%                ($60.8)                    ($14.5)
                     (equal to Base Case Year 2 new building square feet)
     6              Sell Site: Commercial                                                                            10.1%                 ($43.8)                       $2.5
                     (equal to Base Case Year 2 new building square feet) [1]
     7              Spread Costs                                                                                     11.5%                 ($25.0)                     $21.3
                     (over 16-year period)



     [1] Note that in this case, the NPV is improved by the sensitivity while the IRR is not. This is because the discount rate being applied to calculate
       the NPV (15%) is higher than the IRR of the cashflow. Selling a site for commercial use does not provide an appreciable improvement for the
       Project cashflow.
     Source: Port of San Francisco, Economic & Planning Systems




     Economic & Planning Systems 1/15/2010                                                                                          P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
              APPENDICES:
Appendix A:     Additional Support Tables

Appendix B:     Sensitivity Results
Table A1
Biotech Pro Forma
Pier 70 Financial Feasibility Analysis; EPS #17007


 Item                                                       Assumption             Per Bldg. Sq. Ft.                       Total

DEVELOPMENT PROGRAM ASSUMPTIONS
Gross Building Area [1]                             1,268,295 square feet                                             1,268,295
Parking Ratio (Spaces per 1,000; Sq.Ft.)                  0.50 Spaces per 1,000 GSF                                     177,289
Parking Spaces                                            325 square feet                                                   546
Building Floor Area (Sq. Ft.) (excludes parking sq. ft.)                                                              1,091,007
Net Floor Area with Efficiency Ratio                     100%                                                         1,091,007

REVENUE ASSUMPTIONS
Gross Building Revenue (NNN)                             $50.00 /sq. ft.                                            $54,550,339
(less) Operating Expenses                                  10%                                                     ($5,455,034)
(less) Leasing and Marketing                                 5%                                                    ($2,727,517)
(less) Vacancy Rate                                          4%                                                    ($2,182,014)
   Building Revenue Subtotal                                                                                        $44,185,774
Gross Parking Revenue-Reserved [2], [3]                 $225.00 /space/month                                        $1,104,644
Gross Parking Revenue-Daily [2], [3]                     $12.00 /space/day                                            $409,128
  Total Gross Revenue                                                                                               $1,513,772
   (less) Operating Expenses                                 30%                                                     ($454,132)
   (less) Vacancy Rate                                        2%                                                      ($30,275)
      Parking Revenue Subtotal                                                                                      $1,029,365
Net Revenue                                                                                                        $45,215,139

   Revenue Total (capitalized at 7.0%)                      7.0%                                $509              $645,930,563

COST ASSUMPTIONS
Direct Costs
Building Construction Cost                                $280 /sq. ft.                                           $305,481,898
Site Improvement Cost [4]                                   $15 /land sq.ft.                                        $2,624,677
Parking Cost                                            $25,000 /space                                             $13,637,585
   Total Direct Costs                                                                                             $321,744,159

Indirect Costs
 Soft Costs [5]                                              15%                                                   $48,261,624
 Impact Fees                                                 $32 /sq. ft.                                          $34,803,116
 Tenant Improvements                                         $50 /sq. ft.                                          $54,550,339
   Total Indirect Costs                                                                                           $137,615,079

 Contingency (% of total costs)                              10%                                                    $45,935,924

 Profit (% of total costs)                                   10% of total costs                                     $45,935,924

   Total Costs [6]                                                                              $435              $551,231,086

Total Residual Land Value                                                                       $75                $94,699,476
Residual Land Lease                                         8.5%                               $6.35                $8,049,455


[1] Including parking.
[2] Monthly rate is based on Colliers International Parking Survey, 2006; reflects "low" monthly, unreserved parking rate
   in San Francisco. 75% of spaces are assumed to be occupied by monthly parkers.
  Daily rate is estimated based on Mission Bay parking lot rates. 25% of spaces assumed to be daily parking.
[3] Parking tax, calculated as 25% of parking revenue shown here, generated on an annual basis total $378,000.
[4] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall space.
[5] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.
[6] Total costs are comparable to reported costs of the Gladstone building at the Mission Bay campus ($370 in 2004
     per building square foot excluding parking) and the Alexandria Technology Center in South San Francisco
    that is estimated to cost $350 per building square foot (2009). The $280 per square foot direct costs is based on an article
    related to reported costs for biotech construction of $250 to $300 per building square foot (September 2007).
 Source: Economic & Planning Systems, Inc.


Economic & Planning Systems, Inc. 1/11/2010                                                      P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
Table A2
Medical Office Pro Forma
Pier 70 Financial Feasibility Analysis; EPS #17007

 Item                                                              Assumption            Per Bldg. Sq. Ft.                               Total

DEVELOPMENT PROGRAM ASSUMPTIONS
Gross Building Area [1]                                         126,830 square feet                                                   126,830
Parking Ratio/ Parking Sq. Ft. [2]                                  1.19 Spaces per 1,000 GSF                                          35,458
 Parking Spaces                                                     325 square feet                                                       109
Net Building Area (Sq. Ft.)                                                                                                            91,372
Net Floor Area with Efficiency Ratio                                100%                                                               91,372

REVENUE ASSUMPTIONS
Gross Revenue (NNN)                                               $46.00 /sq. ft.                                                   $4,203,104
(less) Operating Expenses                                           10%                                                             ($420,310)
(less) Leasing and Marketing                                          5%                                                            ($210,155)
(less) Vacancy Rate                                                   4%                                                            ($168,124)
   Building Revenue Subtotal                                                                                                        $3,404,514
Gross Parking Revenue-Reserved [3], [4]                         $225.00 /space/month                                                 $220,929
Gross Parking Revenue-Daily [3], [4]                             $12.00 /space/day                                                    $81,826
  Total Gross Revenue                                                                                                                $302,754
   (less) Operating Expenses                                         30%                                                             ($90,826)
   (less) Vacancy Rate                                                2%                                                              ($6,055)
      Parking Revenue Subtotal                                                                                                       $205,873
Net Revenue                                                                                                                        $3,610,387
   Revenue Total (capitalized at 7.%)                               7.0%                              $407                        $51,576,956

COST ASSUMPTIONS
Direct Costs
Building Construction Cost                                        $250 /sq. ft.                                                   $22,842,954
Site Improvement Cost [5]                                           $15 /land sq.ft.                                                $262,468
Parking Cost                                                    $25,000 /space                                                     $2,727,517
   Total Direct Costs                                                                                                             $25,832,939

Indirect Costs
 Soft Costs [6]                                                      15%                                                           $3,874,941
 Impact Fees                                                         $32 /sq. ft.                                                  $2,914,761
 Tenant Improvements                                                 $45 /sq. ft.                                                  $4,111,732
   Total Indirect Costs                                                                                                           $10,901,434

 Contingency (% of total costs)                                      10%                                                            $3,673,437

 Profit (% of total costs)                                           10% of total costs                                             $3,673,437

   Total Costs                                                                                        $348                        $44,081,247

Total Residual Land Value                                                                             $59                          $7,495,709
Residual Land Lease                                                 8.5%                             $5.02                          $637,135


[1] Including parking; based on the EPS Market Study finding related to the likely demand for medical office space as a
 result of the development of a new UCSF hospital on the south end of Mission Bay.
[2] Medical office use is assumed to require a parking ratio above the standard 1.0 spaces per 1,000 sq.ft. development. Here,
   a 1.2 spaces per 1,000 is included in the building pro formas. Combined with the 0.5 ratio included in the parking structure, the total
   for medical office is 1.7 spaces per 1,000 building square feet.
[3] Parking tax generated on an annual basis from spaces included in this proforma total $76,000.
[4] Monthly space rate based on broker reports and daily rates based on Mission Bay structure rates. Daily parking assumed for 250
   days each year.
[5] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall building space.
[6] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.

 Source: Economic & Planning Systems, Inc.



Economic & Planning Systems, Inc. 1/11/2010                                                       P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
Table A3
Office Pro Forma
Pier 70 Financial Feasibility Analysis; EPS #17007


 Item                                                         Assumption              Per Bldg. Sq. Ft.                                    Total


DEVELOPMENT PROGRAM ASSUMPTIONS
Gross Building Area [1]                                1,141,466 square feet                                                          1,141,466
Spaces per 1,000 Sq.Ft.                                      0.50 Spaces per 1,000 GSF                                                  159,560
Parking Spaces                                               325 square feet                                                                491
Net Building Area (Sq. Ft.)                                                                                                             981,906

REVENUE ASSUMPTIONS
Gross Revenue NNN                                         $40.00 /sq. ft.                                                           $39,276,244
(less) Operating Expenses                                   10%                                                                    ($3,927,624)
(less) Leasing and Marketing                                  5%                                                                   ($1,963,812)
(less) Vacancy Rate                                           4%                                                                   ($1,571,050)
   Building Revenue Subtotal                                                                                                        $31,813,758
Gross Parking Revenue-Reserved [2], [3]                  $225.00 /space/month                                                         $994,180
Gross Parking Revenue-Daily [2], [3]                      $12.00 /space/day                                                           $368,215
  Total Gross Revenue                                                                                                               $1,362,395
   (less) Operating Expenses                                  30%                                                                    ($408,718)
   (less) Vacancy Rate                                         2%                                                                     ($27,248)
      Parking Revenue Subtotal                                                                                                        $926,428
Net Revenue                                                                                                                        $32,740,186
  Revenue Total (capitalized at 7.0%)                        7.0%                                  $410                           $467,716,943
  .
COST ASSUMPTIONS
Direct Costs
Building Construction Cost [4]                             $230     /sq. ft.                                                      $225,838,403
Site Improvement Cost [5]                                    $15    /land sq.ft.                                                    $2,362,209
Parking Cost                                             $25,000    /space                                                         $12,273,826
  Total Direct Costs                                                                                                              $240,474,439

Indirect Costs
 Soft Costs [6]                                               15%                                                                  $36,071,166
 Impact Fees                                                  $32 /sq. ft.                                                         $31,322,805
 Tenant Improvements                                          $40 /sq. ft.                                                         $39,276,244
   Total Indirect Costs                                                                                                           $106,670,214

 Contingency (% of total costs)                               10%                                                                   $34,714,465

 Profit (% of total costs)                                    10% of total costs                                                    $34,714,465

   Total Costs                                                                                     $352                           $401,937,548

Total Residual Land Value                                                                           $58                            $65,779,396
Residual Land Lease                                          8.5%                                 $4.90                             $5,591,249


[1] Including parking.
[2] Monthly space rate based on broker reports and daily rates based on Mission Bay structure rates. Daily parking assumed for 250
  days each year. Rates are shown prior to the 25% San Francisco parking tax. Monthly and daily rates total $300 and $15,
     respectively with the tax.
[3] Parking taxes, which are 25% of parking revenues, are calculated on an annual basis and total $341,000.
[4] Based on and EPS survey of office developers (2007, inflated for 2009) in the San Francisco Bay Area.
[5] Includes the cost for plazas and hardscape between buildings; allocated among new uses based on the share of overall space.
[6] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.
 Source: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                                   P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
Table A4
Structured Parking
Pier 70 Financial Feasibility Analysis; EPS #17007


                                                                                                        Per Bldg
 Item                                                                        Assumption                  Sq. Ft.                         Total

DEVELOPMENT PROGRAM ASSUMPTIONS
New Development (sq. ft.)                                                                                                           3,097,080
Amt. needed due to rehabbed bldg demand (sq.ft.)                                                                                      205,589
Residual new development (sq.ft.)                                                                                                   2,891,491
Amt. devoted to parking (sq.ft.)                                                                                                      354,617
Total structure size                                                                                                                  560,205
Total Parking Required (Spaces)                                            325 square feet per stall                                    1,724
 (less) Assumed On-Street Parking                                           0.0 per 100 LF of roadway                                       0
Required Parking                                                                                                                        1,724

REVENUE ASSUMPTIONS
 Gross Revenue-Reserved [3], [5]                                      $225.00 /space/month                                       $3,490,511
 Gross Revenue-Daily [4], [5]                                          $12.00 /space/day                                         $1,613,392
 Total Gross Revenue                                                                                                             $5,103,903
  (less) Operating Expenses                                                30%                                                  ($1,531,171)
  (less) Vacancy Rate                                                       2%                                                    ($102,078)
     Subtotal                                                                                                                    $3,470,654

  Revenue Total                                                  at cap. rate 9%                              $69               $38,562,820

COST ASSUMPTIONS
Direct Costs
 Construction Cost [6]                                                $25,000 per space                                         $43,092,727

Indirect Costs
 Soft Costs [7]                                                            25%                                                  $10,773,182

 Contingency (% of total costs)                                            10%                                                   $4,309,273

 Profit (% of total costs)                                                 10%                                                   $4,309,273

   Total Costs                                                                                              $112                $62,484,454

Total Residual Land Value                                                                                    ($43)             ($23,921,635)


[1] Excludes parking.
[2] Excludes 47,000 square feet of parking provided in the rehabbed space.
[3] Monthly rate is based on Colliers International Parking Survey, 2006; reflects "low" monthly, unreserved parking rate in San Francisco.
75% of spaces are assumed to be occupied by monthly parkers. Rate shown is before parking tax is applied.
[4] Estimated based on Mission Bay parking lot rates. 25% of spaces assumed to be daily parking.
  Daily parking revenue is based on 312-use days (6 days per week). Rate shown is before parking tax applied.
[5] Parking taxes, calculated as 25% of parking revenue included in this proforma, generated on an annual basis total $1,276,000.
[6] Based on EPS experience with nearby projects.
[7] Soft costs include architecture and engineering, permits and fees, legal, project management, and
  finance costs.

Source: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/15/2010                                                 P:\17000s\17007Pier70\Model\17007feas15Jan10_FINAL.xls
Table A5                                                                                                                          Pro forma is not in use.
Hotel Pro Forma
Pier 70 Financial Feasibility Analysis; EPS #17007


Item                                                           Assumption                        Per Room         Per Sq.Ft.                             Total


DEVELOPMENT PROGRAM ASSUMPTIONS
Site 1a and 1b Building Pads (acres)                                                                                                                     0.33
Gross Development Square Footage (6-story building)                      643                                                                          86,700
Number of Rooms [1]                                                      117                                                                             117
Hotel Sq. Ft.                                                            500 gross sq.ft per room                                                     58,286
Parking Ratio                                                            0.75 spaces per hotel room                                                       87
Parking Square Footage                                                   325                                                                           28,414

REVENUE ASSUMPTIONS
Gross Rental Revenue                                                     $150                                                                    $6,382,286
Other Operating Revenue                                                   25%                                                                    $1,595,571
 Subtotal                                                                                                                                        $7,977,857
Occupancy                                                                 70%
 Total Revenue                                                                                                                                   $5,584,500
 (less) Operating Expenses                                                50%     % of Total Rev                                                $2,792,250
 (less) Capital Reserves                                                   5%     % of Total Rev                                                 $279,225
 Annual Net Operating Income                                                                                                                    $2,513,025
Total Value Capped at 8%                                                                         $269,473               $362                   $31,412,813

COST ASSUMPTIONS
Building Construction Costs per Gross Sq. Ft.                          $150 /sq. ft.                                                           $13,005,000
Parking Construction Costs                                           $25,000 / space                                                            $2,185,714
Direct Site Improvement Costs/Footprint Sq. Ft.                          $25 /sq. ft.                                                            $361,250

Soft Costs as % of Direct Costs [2]                                      20% of direct costs                                                    $3,110,393
Impact Fees                                                             $0.00 /sq. ft.                                                                  $0
  Subtotal Construction & Soft Costs                                                                                                           $18,662,357

FF&E/GLA Sq. Ft.                                                          $60 building sq.ft.                                                    $3,497,143
Contingency                                                               10%                                                                    $1,866,236

Profit (% of total costs)                                                 10%                                                                    $1,866,236

Total Costs                                                                                      $222,113               $299                   $25,891,971

Residual Land Value (RLV)                                                                          $47,360              $64                      $5,520,841
Residual Land Lease                                                      8.5%                       $4,026             $5.41                      $469,271


[1] Assumes a mid-rise density building, based on the building envelopes estimated by ROMA for the Pier 70 Preferred Master Plan.
[2] Soft costs include architecture and engineering, permits, legal, project management, and finance costs.

Source: PKF Consulting; Marshall & Swift; Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                                                P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
Table A6                                                                                                                              Pro forma is not in use.
Residential (Condo)
Pier 70 Financial Feasibility Analysis; EPS #17007


Item                                                          Assumptions                       Per Unit         Per Sq.Ft.                                  Total


DEVELOPMENT PROGRAM ASSUMPTIONS
Land Area (acres, Sites 3a and 3b)                                                                                                                            2.07
Total Units (4-5 floor buildings) [1]                                     268                                                                                  268
Average Net Unit SF                                                       830
Living Square Footage % of Total                                         83%
Gross Square Footage                                                    1,000                                                                            268,051
Parking Ratio [2]                                                        0.80                                                                                214
Parking Square Footage                                                   325                                                                              69,693

REVENUE ASSUMPTIONS
Base Sale Revenue [3]                                              $510,000 per unit                                                             $136,705,905
(less) Closing Costs                                                  1.00%                    ($5,100)                                           ($1,367,059)
(less) Cost of Sales                                                  3.00%                   ($15,300)                                           ($4,101,177)
   Revenue Total                                                                              $489,600                $490                       $131,237,669

COST ASSUMPTIONS
Direct Costs
Building Construction Cost                                             $270 per gross sq.ft.                                                        $72,373,714
Parking Construction Costs [4]                                       $25,000 /space                                                                  $5,361,016
  Total Direct Costs                                                                          $290,000                $290                          $77,734,730

Indirect Costs
Soft Costs [5]                                                           30%                   $87,000                $87.0                         $23,320,419

Contingency (% of direct + indirect costs)                               10%                   $37,700                $37.7                        $10,105,515
Profit (% of direct + indirect costs)                                    10%                   $37,700                $37.7                        $10,105,515

  Total Costs                                                                                 $452,400              $452.4                       $121,266,179

Total Residual Land Value                                                                       $37,200                 $37                          $9,971,490


[1] The number is units is calculated based on the total building envelope modeled for Site 3 in the Preferred Master Plan illustrative site plan.
[2] Many residential zoning districts in San Francisco do not require parking and are zoned for 0.75 spaces per 1 bedroom unit and 1.00 spaces per 2-bedroom uni
  Here, with a mix of studio, 1-bedroom and 2-bedrooms units likely for this type of development, an assumption of 0.80 spaces per unit is assumed.
[3] Weighted average of prices, based on sale price of $660 per square foot of living space for market rate units based on DQNews sales
     average for the Pier 70 zip code in 2006 and $330 per square foot for BMR units; BMR units are assumed to make up 15% of the overall mix.
[4] Parking costs estimated at $25,000 in direct costs per space.
[5] Soft costs include architecture and engineering, permits and fees, legal, project management, and finance costs.

 Source: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                                                           P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
Table A7                                                                                                                    Pro forma is not in use.
Residential (Rental)
Pier 70 Financial Feasibility Analysis; EPS #17007


Item                                                   Assumptions                      Per Unit      Per Sq.Ft.                                      Total


DEVELOPMENT PROGRAM ASSUMPTIONS
Land Area (acres, Sites 3a and 3b)                                                                                                                      2.07
Total Units (4-5 floor buildings) [1]                             324                                                                                   324
Average Net Unit SF                                               830
Living Square Footage % of Total                                 83%
Gross Square Footage                                              800                                                                             258,870
Parking Ratio [2]                                                0.75                                                                                 243
Parking Square Footage                                            325                                                                              78,874

REVENUE ASSUMPTIONS
Base Rental Revenue [3]                                        $2.96    NLA sq.ft./month                                                     $9,539,864
(less) Operating Expenses                                      20.0%    of gross income                                                     ($1,907,973)
(less) Vacancy                                                  3.0%    of gross income                                                       ($286,196)
Gross Parking Revenue                                        $225.00    /space/month                                                           $655,264
  Net Operating Income                                                                                                                       $7,345,696
Total Value Capped at 6.5%                                                            $338,766             $423                          $109,620,381

COST ASSUMPTIONS
Direct Costs
Building Construction Cost                                     $230 per gross sq.ft.                                                        $59,410,585
Parking Construction Costs [4]                               $25,000 /space                                                                  $6,067,257
   Total Direct Costs                                                                 $202,350             $253                             $65,477,843

Indirect Costs
Soft Costs [5]                                                   30%                   $60,705            $75.9                             $19,643,353

Contingency (% of total costs)                                   10%                   $26,306            $32.9                               $8,512,120
Profit (% of total costs)                                        10%                   $26,306            $32.9                               $8,512,120
   Total Costs                                                                        $315,666           $394.6                           $102,145,435

Total Residual Land Value                                                               $23,100            $29                                $7,474,946
Residual Land Lease                                              8.5%                   $1,964            $2.45                                $635,370


[1] The number is units is calculated based on the total building envelope modeled for Site 3 in the Preferred Master Plan illustrative site plan.
[2] Many residential zoning districts in San Francisco do not require parking and are zoned for 0.75 spaces per 1 bedroom unit and 1.00 spaces
  2-bedroom unit. Here, a rental development with a mix of studio, 1-bedroom and 2-bedrooms units is assumed to have 0.80 spaces per unit is assume
[3] Weighted average of lease rates with $3.20 per square foot per month of living space for market rate units and $1.60 per square
  foot for BMR units; BMR units are assumed to make up 15% of the overall mix.
[4] The cost of sale of 3% is assumed.
[5] Parking costs estimated at $25,000 in direct costs per space.
[6] Soft costs include architecture and engineering, permits and fees, legal, project management, and finance costs.

 Source: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                                                    P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
   Table A8
   Fiscal Benefits Summary
   Pier 70 Financial Feasibility Analysis; EPS #17007

   Item                                                                                      Fee Total [1]



   New Development Sq. Ft. [2]                                                                   2,536,591

   City Impact Fees
   Housing ($/sq.ft.) [3]                                                                           $19.96
   Child Care ($/sq.ft.) [4]                                                                         $1.00
   Transit Fee ($/sq.ft.) [4]                                                                       $10.94
     Subtotal ($/sq.ft.)                                                                           $31.90
      Total Impact Fees [5]                                                                   $80,920,000

    Annual Parking Tax
    Estimate at Buildout [6]                                                                   $2,078,900

    School District Impact Fees
     $/Sq. Ft. [7]                                                                                   $0.27
     Total School Impact Fees                                                                     $685,000



   [1] New development is assumed to pay City impact fees imposed on "office" uses. Given the density
   of development envisioned for Pier 70, the office use - which requires the highest fee level - appears
   to be the most applicable use. The use clearly includes office and medical uses. A portion of biotech
   or R&D development may be categorized under R&D or Production, Distribution, and Repair. If
   biotech/R&D uses were not categorized under office, the Housing fee would be reduced by about
   $6.00 per square foot.
   [2] Assumes that roughly 500,000 square feet in parking structure development will not provide impact
   fee payments.
   [3] Fee amount based on July 15, 2008 Mayor's Office of Housing notice of fees.
   [4] Based on interview with City staff.
   [5] Fees are shown applied only to new development. Rehabilitation building square footage is
   excluded.
   [6] Parking tax estimate, which is based on San Francisco's parking tax rate of 25% of parking
   revenue, is shown on each vertical pro forma table.

   [7] Dollars per square foot for 2009 based on interview with San Francisco Unified School District staff.

    Source: City of San Francisco, Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                     P:\17000s\17007Pier70\Model\17007feas30Dec09_FINAL.xls
                 APPENDIX B:
             Sensitivity Results


Tables B-1 and B-2     Sensitivity 1—State Share of IFD

Tables B-3 and B-4     Sensitivity 2—Public Loan

Tables B-5 and B-6     Sensitivity 3—Additional Public Debt with Repayment

Tables B-7 and B-8     Sensitivity 4—Ground Lease Site: Rental Residential

Tables B-9 and B-10    Sensitivity 5—Sell Site: For-Sale Residential

Tables B-11 and B-12   Sensitivity 6—Sell Site: Commercial

Tables B-13 and B-14   Sensitivity 7—Spread Costs
   SENSITIVITY 1
STATE SHARE OF IFD
Table B1 - Sensitivity 1                                                                                            Sensitivity 1: State Share of IFD
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                               NPV (at 15%)                        $2009 Summary
                                                                                                             [1]                                  [2]


REVENUES
New Construction Ground Lease Revenue                                                               $55,437,142                           $305,250,276
Interim Leasing Income                                                                              $10,623,793                            $15,950,000
Proposition A Park Bond                                                                             $10,000,000                            $10,000,000
Infrastructure Financing District Bond (90.3% of T.I.)                                              $41,510,556                           $132,948,454
Infrastructure Financing Pay As You Go                                                               $5,576,675                            $21,467,025
   Total Revenues                                                                                 $123,148,165                            $485,615,755
EXPENDITURES
Sitework Costs
Demolition                                                                                           $3,114,795                             $4,317,725
Infrastructure                                                                                      $32,076,218                            $46,000,000
Structured Parking                                                                                   $4,878,829                            $23,933,705
   Subtotal                                                                                         $40,069,842                            $74,251,430
Waterfront Improvements
Remediation                                                                                         $11,590,520                            $15,000,000
Park Space and Open Space                                                                           $12,661,348                            $22,874,663
Piers/Wharfs                                                                                         $7,866,045                            $45,000,000
  Subtotal                                                                                          $32,117,914                            $82,874,663
Soft Costs
Planning & Entitlement                                                                               $5,609,388                             $9,856,305
Project Management                                                                                   $2,887,510                             $6,285,044
Contingency                                                                                         $14,437,551                            $31,425,219
  Subtotal                                                                                          $22,934,449                            $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                       $95,122,205                           $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                    $148,633,125                            $355,060,817
(Less) Historic Tax Credits                                                                       ($29,726,625)                           ($71,012,163)
(Less) Historic Building Lease Revenue                                                            ($45,975,969)                          ($263,902,918)
  Subtotal                                                                                         $72,930,531                             $20,145,735
Ongoing Remediation Monitoring                                                                         $889,236                              $4,600,000
Base Rent To The Port                                                                               $24,935,963                            $87,000,000
   Total Expenditures                                                                             $193,877,935                            $316,438,395
NET REVENUE BEFORE PROP D                                                                          ($70,729,770)                          $169,177,360
IRR                                                                    9.0%

PROP D Bond                                                                                         $24,199,503                            $41,986,485

NET REVENUE AFTER PROP D                                                                           ($46,530,267)                          $211,163,846
IRR                                                                  10.5%
CFD Public Financing
Mello-Roos CFD                                                                                      $25,957,699                            $83,787,096
(Less) CFD Value Reduction @ 75%                                                                   ($13,063,867)                          ($88,291,020)
   Value of CFD                                                                                     $12,893,832                            ($4,503,925)
NET REVENUE AFTER CFD FINANCING                                                                    ($33,636,435)                          $206,659,921
IRR                                                                  11.4%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                  ($138.9)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                          P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls
Table B2 - Sensitivity 1                                                                                                                                                                                                    Sensitivity 1: State Share of IFD
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                    Year
Item                                                                 Factor     Total (Yrs 0-30)       0                1               2               3             4                     5                     6                      7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239               $0              $0      $1,377,441      $1,479,118     $1,479,118          $2,840,628            $3,762,080             $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830               $0       $318,568       $1,439,530      $2,241,924     $3,044,318          $3,846,713            $4,649,107             $5,451,501            $6,253,896
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000     $2,030,000          $1,740,000            $1,450,000             $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000      $10,000,000              $0              $0              $0               $0                    $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $835,973,069       $10,000,000      $3,218,568      $5,426,970      $6,041,042     $6,553,437          $8,427,341            $9,861,187           $11,073,178           $11,723,529
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422      $10,000,000      $3,315,125      $5,757,473      $6,601,210     $7,375,951          $9,769,597           $11,774,773           $13,618,613           $14,851,015

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242     $1,439,242                  $0                    $0                     $0                    $0
 Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333     $6,133,333          $3,066,667            $3,066,667             $3,066,667            $3,066,667
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0              $0             $0                  $0                    $0                     $0                    $0
   Subtotal                                                                        $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575     $7,572,575          $3,066,667            $3,066,667             $3,066,667            $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000     $2,500,000          $2,500,000                        $0                 $0                        $0
Park Space and Open Space                                                          $22,874,663       $7,751,940              $0              $0              $0             $0                  $0                        $0         $6,033,769                        $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0              $0             $0                  $0                        $0                 $0                        $0
  Subtotal                                                                         $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000     $2,500,000          $2,500,000                        $0         $6,033,769                        $0
Total Development Cost (2009$)                                                    $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575    $10,072,575          $5,566,667            $3,066,667             $9,100,435            $3,066,667
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305       $2,819,264       $431,667        $503,629        $503,629       $503,629            $278,333                $153,333             $455,022                $153,333
 Project Management                                    4% of development cost       $6,285,044        $655,411        $345,333        $402,903        $402,903       $402,903            $222,667                $122,667             $364,017                $122,667
 Contingency                                          20% of development cost      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515     $2,014,515          $1,113,333               $613,333            $1,820,087               $613,333
   Subtotal                                                                        $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047     $2,921,047          $1,614,333               $889,333            $2,639,126               $889,333
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0     $25,480,000      $4,560,150              $0     $51,620,656       $18,829,730            $33,088,424             $2,989,718          $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0    ($10,324,131)      ($3,765,946)           ($6,617,685)             ($597,944)         ($4,615,543)
  Subtotal                                                                       $284,048,654               $0     $20,384,000      $3,648,120              $0     $41,296,525       $15,063,784            $26,470,739             $2,391,775          $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000             $0               $0              $0              $0              $0                     $0                    $0           $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622    $57,190,146        $25,144,784            $33,326,739           $17,231,336           $25,518,171
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390    $64,368,014        $29,149,696            $39,793,869           $21,192,370           $32,325,655
Required Public Financing (inflated)
IFD Bond (90.3% of T.I.) (inflated) [8]                                           $191,363,793               $0              $0              $0      $4,188,292     $9,146,228          $6,864,146            $9,083,583             $8,904,596           $8,994,089
IFD Pay As You Go (inflated)                                                       $32,082,506               $0              $0         $84,521       $269,094       $407,614             $590,923              $770,620               $952,123           $1,127,666
  Total IFD Proceeds (inflated)                                                   $223,446,300               $0              $0         $84,521      $4,457,386     $9,553,842          $7,455,069            $9,854,203             $9,856,719          $10,121,756
NET REVENUE BEFORE PROP D                                                         $997,688,344     ($13,137,002)   ($32,138,505)   ($14,889,840)    ($6,308,793) ($47,438,221) ($11,925,029) ($18,164,894)       $2,282,962    ($7,352,884)
CUMULATIVE                                                                                         ($13,137,002)   ($45,275,507)   ($60,165,348)   ($66,474,141) ($113,912,362) ($125,837,391) ($144,002,285) ($141,719,323) ($149,072,207)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0              $0              $0              $0       $48,673,844                         $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0              $0              $0              $0              $0             $0                  $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765              $0              $0              $0      $1,754,897     $6,434,220          $4,893,108            $5,132,850             $5,381,643            $5,639,796
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)              $0              $0              $0      ($121,250)     ($565,806)          ($903,883)          ($1,258,524)           ($1,630,355)          ($2,020,022)
   Total Public Financing (inflated)                                              ($41,629,300)              $0              $0              $0      $1,633,647     $5,868,414          $3,989,225            $3,874,326             $3,751,288            $3,619,774
NET REVENUE AFTER PROP D AND CFD [11]                                           $1,004,732,888     ($13,137,002)   ($32,138,505)   ($14,889,840)    ($4,675,146) ($41,569,807)       $40,738,040           ($14,290,568)           $6,034,250           ($3,733,110)
CUMULATIVE                                                                                         ($13,137,002)   ($45,275,507)   ($60,165,348)   ($64,840,494) ($106,410,301)     ($65,672,261)          ($79,962,829)         ($73,928,579)         ($77,661,689)




                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                          Page 1 of 5
Table B2 - Sensitivity 1                                                                                                                                                                                                    Sensitivity 1: State Share of IFD
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)         9              10              11              12             13                   14                    15                    16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056      $5,664,159      $6,545,533      $6,569,322    $10,543,283        $10,734,533           $12,116,894            $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830        $7,056,290      $7,858,684      $8,661,079      $9,463,473    $10,265,868        $11,068,262           $11,870,656            $12,673,051           $13,475,445
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000        $290,000               $0              $0             $0                 $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
  Total Revenues (2009$)                                                         $835,973,069        $13,189,346     $13,812,844     $15,206,612     $16,032,795    $20,809,151        $21,802,795           $23,987,550            $24,789,945           $25,592,339
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422       $17,209,104     $18,563,307     $21,049,508     $22,858,933    $30,558,939        $32,978,684           $37,371,822            $39,780,584           $42,300,237

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Infrastructure [4]                                                                $46,000,000        $3,066,667              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
   Subtotal                                                                        $74,251,430        $3,066,667              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0              $0              $0              $0             $0                  $0                    $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0        $926,374              $0              $0     $5,275,624                  $0            $2,886,956                    $0                     $0
Piers/Wharfs                                                                       $45,000,000                $0              $0      $4,500,000              $0     $4,500,000          $4,500,000            $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                         $82,874,663                $0        $926,374      $4,500,000              $0     $9,775,624          $4,500,000            $7,386,956            $4,500,000             $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,066,667        $926,374      $4,500,000      $7,977,902     $9,775,624          $4,500,000          $15,364,858             $4,500,000           $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305          $153,333         $46,319       $225,000        $398,895       $488,781            $225,000              $768,243              $225,000               $623,895
 Project Management                                    4% of development cost       $6,285,044          $122,667         $37,055       $180,000        $319,116       $391,025            $180,000              $614,594              $180,000               $499,116
 Contingency                                          20% of development cost      $31,425,219          $613,333        $185,275       $900,000       $1,595,580     $1,955,125            $900,000            $3,072,972              $900,000             $2,495,580
   Subtotal                                                                        $47,566,567          $889,333        $268,649      $1,305,000      $2,313,591     $2,834,931          $1,305,000            $4,455,809            $1,305,000             $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366      $2,629,001      $94,204,246     $2,231,499       $33,001,860                         $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)     ($446,300)      ($6,600,372)                        $0                    $0                    $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893      $2,103,201      $75,363,397     $1,785,199       $26,401,488                         $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000        $200,000       $200,000            $200,000              $200,000               $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $11,937,518     $30,808,916     $11,008,201     $88,754,890     $17,495,754       $35,306,488           $22,920,666             $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $15,575,753     $41,404,607     $15,237,924    $126,543,251    $25,693,105       $53,404,231           $35,709,651            $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (90.3% of T.I.) (inflated) [8]                                           $191,363,793        $8,698,761     $10,255,947      $9,378,911     $10,032,213    $10,103,808        $17,487,015           $11,311,969            $14,184,708           $12,180,055
IFD Pay As You Go (inflated)                                                       $32,082,506        $1,334,634      $1,523,903      $1,726,355      $1,930,253     $2,283,145         $2,511,424            $2,797,675             $3,043,471            $3,299,923
  Total IFD Proceeds (inflated)                                                   $223,446,300       $10,033,395     $11,779,849     $11,105,266     $11,962,466    $12,386,953        $19,998,439           $14,109,644            $17,228,179           $15,479,979
NET REVENUE BEFORE PROP D                                                         $997,688,344       $11,666,746 ($11,061,451) $16,916,850 ($91,721,852) $17,252,787              ($427,108) $15,771,814      $42,718,852    $26,051,337
CUMULATIVE                                                                                         ($137,405,461) ($148,466,912) ($131,550,062) ($223,271,914) ($206,019,127) ($206,446,236) ($190,674,421) ($147,955,569) ($121,904,232)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0              $0             $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $5,907,628      $6,185,467      $6,473,654      $6,772,539     $7,082,484         $7,403,863            $7,737,061            $8,082,477            $8,440,521
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($2,428,194)    ($2,855,563)    ($3,302,843)    ($3,770,775)   ($4,260,121)       ($4,771,672)          ($5,306,244)          ($5,864,682)          ($6,447,858)
   Total Public Financing (inflated)                                              ($41,629,300)        $3,479,434      $3,329,904      $3,170,811      $3,001,764     $2,822,363         $2,632,191            $2,430,817            $2,217,795            $1,992,663
NET REVENUE AFTER PROP D AND CFD [11]                                           $1,004,732,888       $15,146,180     ($7,731,547)    $20,087,661 ($88,720,088) $20,075,150         $2,205,083               $18,202,631           $44,936,647            $28,044,000
CUMULATIVE                                                                                          ($62,515,509)   ($70,247,056)   ($50,159,395) ($138,879,483) ($118,804,333) ($116,599,250)             ($98,396,619)         ($53,459,972)          ($25,415,971)




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 2 of 5
Table B2 - Sensitivity 1                                                                                                                                                                                                     Sensitivity 1: State Share of IFD
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)        18              19             20               21              22                   23                    24                    25                    26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894     $12,485,480     $12,485,480     $12,485,480     $12,485,480         $12,485,480          $12,485,480           $12,485,480           $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830       $14,277,839     $14,277,839     $14,277,839     $14,277,839     $14,277,839         $14,277,839          $14,277,839           $14,277,839           $14,277,839
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0              $0              $0              $0              $0                  $0                   $0                    $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
  Total Revenues (2009$)                                                         $835,973,069        $26,394,733     $26,763,319     $26,763,319     $26,763,319     $26,763,319         $26,763,319          $26,763,319           $26,763,319           $26,763,319
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422       $44,935,267     $46,929,643     $48,337,532     $49,787,658     $51,281,288         $52,819,726          $54,404,318           $56,036,447           $57,717,541

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
 Infrastructure [4]                                                                $46,000,000                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
   Subtotal                                                                        $74,251,430                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000      $4,500,000      $9,000,000              $0                $0                    $0                   $0                    $0                     $0
  Subtotal                                                                         $82,874,663        $4,500,000      $4,500,000      $9,000,000              $0                $0                    $0                   $0                    $0                     $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000      $4,500,000      $9,000,000              $0                $0                    $0                   $0                    $0                     $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000        $225,000        $450,000               $0                $0                    $0                   $0                    $0                     $0
 Project Management                                    4% of development cost       $6,285,044         $180,000        $180,000        $360,000               $0                $0                    $0                   $0                    $0                     $0
 Contingency                                          20% of development cost      $31,425,219         $900,000        $900,000       $1,800,000              $0                $0                    $0                   $0                    $0                     $0
   Subtotal                                                                        $47,566,567        $1,305,000      $1,305,000      $2,610,000              $0                $0                    $0                   $0                    $0                     $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556              $0              $0              $0                $0                    $0                   $0                    $0                     $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)             $0              $0              $0                $0                    $0                   $0                    $0                     $0
  Subtotal                                                                       $284,048,654       $19,282,845              $0              $0              $0                $0                    $0                   $0                    $0                     $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000        $200,000        $200,000             $200,000             $200,000              $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000      $2,900,000          $2,900,000            $2,900,000            $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845      $8,905,000     $14,710,000       $3,100,000      $3,100,000         $3,100,000            $3,100,000             $3,100,000           $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $47,987,919     $15,614,971     $26,567,896       $5,766,913      $5,939,921         $6,118,118            $6,301,662             $6,490,712           $6,685,433
Required Public Financing (inflated)
IFD Bond (90.3% of T.I.) (inflated) [8]                                           $191,363,793       $12,708,067     $13,253,976     $14,587,428              $0                $0                    $0                   $0                    $0                     $0
IFD Pay As You Go (inflated)                                                       $32,082,506        $3,567,392      $3,861,770              $0              $0                $0                    $0                   $0                    $0                     $0
  Total IFD Proceeds (inflated)                                                   $223,446,300       $16,275,458     $17,115,746     $14,587,428              $0                $0                    $0                   $0                    $0                     $0
NET REVENUE BEFORE PROP D                                                         $997,688,344       $13,222,806     $48,430,417     $36,357,064     $44,020,745     $45,341,367       $46,701,608 $48,102,656                    $49,545,736            $51,032,108
CUMULATIVE                                                                                         ($108,681,425)   ($60,251,008)   ($23,893,944)    $20,126,801     $65,468,168      $112,169,776 $160,272,432                  $209,818,168           $260,850,276

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0              $0                $0                    $0                   $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0              $0              $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $8,811,618      $9,196,206      $9,594,736              $0              $0                 $0                    $0                    $0                    $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($7,056,674)    ($7,692,062)    ($8,354,986)    ($8,354,986)    ($8,354,986)       ($8,354,986)          ($8,354,986)          ($8,354,986)          ($8,354,986)
   Total Public Financing (inflated)                                              ($41,629,300)        $1,754,944      $1,504,143      $1,239,750    ($8,354,986)    ($8,354,986)       ($8,354,986)          ($8,354,986)          ($8,354,986)          ($8,354,986)
NET REVENUE AFTER PROP D AND CFD [11]                                           $1,004,732,888       $14,977,750    $49,934,561     $37,596,814      $35,665,759     $36,986,381       $38,346,622 $39,747,670                    $41,190,750            $42,677,122
CUMULATIVE                                                                                          ($10,438,221)   $39,496,340     $77,093,154     $112,758,912    $149,745,294      $188,091,916 $227,839,586                  $269,030,336           $311,707,459




                                                                                                                                                                          P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                             Page 3 of 5
Table B2 - Sensitivity 1                                                                                                           Sensitivity 1: State Share of IFD
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)       27              28               29                30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480     $12,485,480      $12,485,480       $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830      $14,277,839     $14,277,839      $14,277,839       $142,778,393
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0              $0               $0                 $0
Proposition A Park Bond (2009$)                                                    $10,000,000               $0              $0                $0                $0
  Total Revenues (2009$)                                                         $835,973,069       $26,763,319     $26,763,319      $26,763,319       $267,633,194
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422      $59,449,067     $61,232,539      $63,069,515       $649,616,008

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0                $0                $0
 Infrastructure [4]                                                                $46,000,000               $0              $0                $0                $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0                $0                $0
   Subtotal                                                                        $74,251,430               $0              $0                $0                $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000               $0              $0                $0                $0
Park Space and Open Space                                                          $22,874,663               $0              $0                $0                $0
Piers/Wharfs                                                                       $45,000,000               $0              $0                $0                $0
  Subtotal                                                                         $82,874,663               $0              $0                $0                $0
Total Development Cost (2009$)                                                    $157,126,093               $0              $0                $0                $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305               $0              $0                $0                $0
 Project Management                                    4% of development cost       $6,285,044               $0              $0                $0                $0
 Contingency                                          20% of development cost      $31,425,219               $0              $0                $0                $0
   Subtotal                                                                        $47,566,567               $0              $0                $0                $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0              $0                $0                 $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0              $0                $0                 $0
  Subtotal                                                                       $284,048,654               $0              $0                $0                 $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000        $200,000        $200,000         $200,000         $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000      $2,900,000       $2,900,000        $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000      $3,100,000       $3,100,000       $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $6,885,996      $7,092,576       $7,305,353       $75,245,137
Required Public Financing (inflated)
IFD Bond (90.3% of T.I.) (inflated) [8]                                           $191,363,793               $0              $0                $0                $0
IFD Pay As You Go (inflated)                                                       $32,082,506               $0              $0                $0                $0
  Total IFD Proceeds (inflated)                                                   $223,446,300               $0              $0                $0                $0
NET REVENUE BEFORE PROP D                                                         $997,688,344      $52,563,071     $54,139,963     $55,764,162       $574,370,871
CUMULATIVE                                                                                         $313,413,347    $367,553,311    $423,317,473       $997,688,344

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0                $0                $0
Public Financing Available Now
Grants                                                                                       $0               $0              $0               $0                $0
Mello-Roos CFD (inflated)                                                          $120,924,765               $0              $0               $0                $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)     ($8,354,986)    ($8,233,736)     ($7,789,180)     ($19,434,738)
   Total Public Financing (inflated)                                              ($41,629,300)     ($8,354,986)    ($8,233,736)     ($7,789,180)     ($19,434,738)
NET REVENUE AFTER PROP D AND CFD [11]                                           $1,004,732,888      $44,208,085     $45,906,228     $47,974,982      $554,936,133
CUMULATIVE                                                                                         $355,915,544    $401,821,772    $449,796,754     $1,004,732,888




                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen1.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                          Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




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         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5
       SENSITIVITY 2
GRANT FUNDS, NO REPAYMENT
Table B3 - Sensitivity 2                                                                                                   Senstivity 2 - Outside Grant
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                                 NPV (at 15%)                        $2009 Summary
                                                                                                               [1]                                  [2]


REVENUES
New Construction Ground Lease Revenue                                                                 $55,437,142                           $305,250,276
Interim Leasing Income                                                                                $10,623,793                            $15,950,000
Proposition A Park Bond                                                                               $10,000,000                            $10,000,000
Other Bonds                                                                                           $33,956,900                            $40,000,000
Infrastructure Financing District Bond (65% of T.I.)                                                  $29,880,245                            $95,699,330
Infrastructure Financing Pay As You Go                                                                 $4,014,218                            $15,452,455
   Total Revenues                                                                                   $143,912,297                            $482,352,060
EXPENDITURES
Sitework Costs
Demolition                                                                                             $3,114,795                             $4,317,725
Infrastructure                                                                                        $32,076,218                            $46,000,000
Structured Parking                                                                                     $4,878,829                            $23,933,705
   Subtotal                                                                                           $40,069,842                            $74,251,430
Waterfront Improvements
Remediation                                                                                           $11,590,520                            $15,000,000
Park Space and Open Space                                                                             $12,661,348                            $22,874,663
Piers/Wharfs                                                                                           $7,866,045                            $45,000,000
  Subtotal                                                                                            $32,117,914                            $82,874,663
Soft Costs
Planning & Entitlement                                                                                 $5,609,388                             $9,856,305
Project Management                                                                                     $2,887,510                             $6,285,044
Contingency                                                                                           $14,437,551                            $31,425,219
  Subtotal                                                                                            $22,934,449                            $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                         $95,122,205                           $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                      $148,633,125                            $355,060,817
(Less) Historic Tax Credits                                                                         ($29,726,625)                           ($71,012,163)
(Less) Historic Building Lease Revenue                                                              ($45,975,969)                          ($263,902,918)
  Subtotal                                                                                           $72,930,531                             $20,145,735
Ongoing Remediation Monitoring                                                                           $889,236                              $4,600,000
Base Rent To The Port                                                                                 $24,935,963                            $87,000,000
   Total Expenditures                                                                               $193,877,935                            $316,438,395
NET REVENUE BEFORE PROP D                                                                            ($49,965,638)                          $165,913,666
IRR                                                                    9.7%

PROP D Bond                                                                                           $24,199,503                            $41,986,485

NET REVENUE AFTER PROP D                                                                             ($25,766,135)                          $207,900,151
IRR                                                                   11.7%
CFD Public Financing
Mello-Roos CFD                                                                                        $25,957,699                            $83,787,096
(Less) CFD Value Reduction @ 75%                                                                     ($13,063,867)                          ($88,291,020)
   Value of CFD                                                                                       $12,893,832                            ($4,503,925)
NET REVENUE AFTER CFD FINANCING                                                                      ($12,872,303)                          $203,396,226
IRR                                                                   13.0%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                  ($124.0)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                           P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
Table B4 - Sensitivity 2                                                                                                                                                                                                           Senstivity 2 - Outside Grant
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                     Year
Item                                                                 Factor     Total (Yrs 0-30)       0                1               2               3              4                     5                     6                      7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239               $0              $0      $1,377,441      $1,479,118      $1,479,118          $2,840,628            $3,762,080             $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830               $0       $318,568       $1,439,530      $2,241,924      $3,044,318          $3,846,713            $4,649,107             $5,451,501            $6,253,896
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000      $2,030,000          $1,740,000            $1,450,000             $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000      $10,000,000              $0              $0              $0               $0                     $0                    $0                    $0                     $0
Other Funds (2009$)                                                                $40,000,000               $0     $20,000,000     $20,000,000              $0               $0                     $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $835,973,069       $10,000,000     $23,218,568     $25,426,970      $6,041,042      $6,553,437          $8,427,341            $9,861,187           $11,073,178           $11,723,529
  Total Revenues (inflated)                           3.0% /yr                  $1,683,169,422      $10,000,000     $23,915,125     $26,975,473      $6,601,210      $7,375,951          $9,769,597           $11,774,773           $13,618,613           $14,851,015

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242      $1,439,242                  $0                    $0                     $0                    $0
 Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333      $6,133,333          $3,066,667            $3,066,667             $3,066,667            $3,066,667
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
   Subtotal                                                                        $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575      $7,572,575          $3,066,667            $3,066,667             $3,066,667            $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000      $2,500,000          $2,500,000                        $0                 $0                        $0
Park Space and Open Space                                                          $22,874,663       $7,751,940              $0              $0              $0              $0                  $0                        $0         $6,033,769                        $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0              $0              $0                  $0                        $0                 $0                        $0
  Subtotal                                                                         $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000      $2,500,000          $2,500,000                        $0         $6,033,769                        $0
Total Development Cost (2009$)                                                    $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575     $10,072,575          $5,566,667            $3,066,667             $9,100,435            $3,066,667
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305       $2,819,264       $431,667        $503,629        $503,629        $503,629            $278,333                $153,333             $455,022                $153,333
 Project Management                                    4% of development cost       $6,285,044        $655,411        $345,333        $402,903        $402,903        $402,903            $222,667                $122,667             $364,017                $122,667
 Contingency                                          20% of development cost      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515      $2,014,515          $1,113,333               $613,333            $1,820,087               $613,333
   Subtotal                                                                        $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047      $2,921,047          $1,614,333               $889,333            $2,639,126               $889,333
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0     $25,480,000      $4,560,150              $0      $51,620,656       $18,829,730            $33,088,424             $2,989,718          $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0     ($10,324,131)      ($3,765,946)           ($6,617,685)             ($597,944)         ($4,615,543)
  Subtotal                                                                       $284,048,654               $0     $20,384,000      $3,648,120              $0      $41,296,525       $15,063,784            $26,470,739             $2,391,775          $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000             $0               $0              $0              $0               $0                     $0                    $0           $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000      $2,900,000          $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622     $57,190,146        $25,144,784            $33,326,739           $17,231,336           $25,518,171
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390     $64,368,014        $29,149,696            $39,793,869           $21,192,370           $32,325,655
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024               $0              $0              $0      $3,014,828      $6,583,664          $4,940,969            $6,538,570             $6,409,731            $6,474,151
IFD Pay As You Go (inflated)                                                       $23,093,720               $0              $0         $60,840       $193,700        $293,410             $425,360              $554,710               $685,360              $811,720
  Total IFD Proceeds (inflated)                                                   $160,841,744               $0              $0         $60,840      $3,208,528      $6,877,074          $5,366,329            $7,093,280             $7,095,091            $7,285,871
NET REVENUE BEFORE PROP D                                                         $976,901,788     ($13,137,002)   ($11,538,505)     $6,304,479     ($7,557,651)   ($50,114,989)     ($14,013,770) ($20,925,817)      ($478,666) ($10,188,769)
CUMULATIVE                                                                                         ($13,137,002)   ($24,675,507)   ($18,371,028)   ($25,928,680)   ($76,043,669)     ($90,057,439) ($110,983,255) ($111,461,922) ($121,650,691)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0              $0              $0               $0       $48,673,844                         $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0              $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765              $0              $0              $0      $1,754,897      $6,434,220          $4,893,108            $5,132,850             $5,381,643            $5,639,796
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)              $0              $0              $0      ($121,250)      ($565,806)          ($903,883)          ($1,258,524)           ($1,630,355)          ($2,020,022)
   Total Public Financing (inflated)                                              ($41,629,300)              $0              $0              $0      $1,633,647      $5,868,414          $3,989,225            $3,874,326             $3,751,288            $3,619,774
NET REVENUE AFTER PROP D AND CFD [11]                                             $983,946,332     ($13,137,002)   ($11,538,505)     $6,304,479     ($5,924,004)   ($44,246,575)      $38,649,299           ($17,051,491)           $3,272,622           ($6,568,995)
CUMULATIVE                                                                                         ($13,137,002)   ($24,675,507)   ($18,371,028)   ($24,295,033)   ($68,541,608)     ($29,892,309)          ($46,943,800)         ($43,671,178)         ($50,240,173)




                                                                                                                                                                        P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                           Page 1 of 5
Table B4 - Sensitivity 2                                                                                                                                                                                                          Senstivity 2 - Outside Grant
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)         9              10              11              12             13                   14                    15                    16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056      $5,664,159      $6,545,533      $6,569,322    $10,543,283        $10,734,533           $12,116,894            $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830        $7,056,290      $7,858,684      $8,661,079      $9,463,473    $10,265,868        $11,068,262           $11,870,656            $12,673,051           $13,475,445
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000        $290,000               $0              $0             $0                 $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Other Funds (2009$)                                                                $40,000,000                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
  Total Revenues (2009$)                                                         $835,973,069        $13,189,346     $13,812,844     $15,206,612     $16,032,795    $20,809,151        $21,802,795           $23,987,550            $24,789,945           $25,592,339
  Total Revenues (inflated)                           3.0% /yr                  $1,683,169,422       $17,209,104     $18,563,307     $21,049,508     $22,858,933    $30,558,939        $32,978,684           $37,371,822            $39,780,584           $42,300,237

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Infrastructure [4]                                                                $46,000,000        $3,066,667              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
   Subtotal                                                                        $74,251,430        $3,066,667              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0              $0              $0              $0             $0                  $0                    $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0        $926,374              $0              $0     $5,275,624                  $0            $2,886,956                    $0                     $0
Piers/Wharfs                                                                       $45,000,000                $0              $0      $4,500,000              $0     $4,500,000          $4,500,000            $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                         $82,874,663                $0        $926,374      $4,500,000              $0     $9,775,624          $4,500,000            $7,386,956            $4,500,000             $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,066,667        $926,374      $4,500,000      $7,977,902     $9,775,624          $4,500,000          $15,364,858             $4,500,000           $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305          $153,333         $46,319       $225,000        $398,895       $488,781            $225,000              $768,243              $225,000               $623,895
 Project Management                                    4% of development cost       $6,285,044          $122,667         $37,055       $180,000        $319,116       $391,025            $180,000              $614,594              $180,000               $499,116
 Contingency                                          20% of development cost      $31,425,219          $613,333        $185,275       $900,000       $1,595,580     $1,955,125            $900,000            $3,072,972              $900,000             $2,495,580
   Subtotal                                                                        $47,566,567          $889,333        $268,649      $1,305,000      $2,313,591     $2,834,931          $1,305,000            $4,455,809            $1,305,000             $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366      $2,629,001      $94,204,246     $2,231,499       $33,001,860                         $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)     ($446,300)      ($6,600,372)                        $0                    $0                    $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893      $2,103,201      $75,363,397     $1,785,199       $26,401,488                         $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000        $200,000       $200,000            $200,000              $200,000               $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $11,937,518     $30,808,916     $11,008,201     $88,754,890     $17,495,754       $35,306,488           $22,920,666             $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $15,575,753     $41,404,607     $15,237,924    $126,543,251    $25,693,105       $53,404,231           $35,709,651            $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024        $6,261,567      $7,382,464      $6,751,154      $7,221,416     $7,272,951        $12,587,553            $8,142,613            $10,210,476            $8,767,482
IFD Pay As You Go (inflated)                                                       $23,093,720         $960,700       $1,096,940      $1,242,670      $1,389,440     $1,643,460         $1,807,780            $2,013,830             $2,190,760            $2,375,360
  Total IFD Proceeds (inflated)                                                   $160,841,744        $7,222,267      $8,479,404      $7,993,824      $8,610,856     $8,916,411        $14,395,333           $10,156,443            $12,401,236           $11,142,842
NET REVENUE BEFORE PROP D                                                         $976,901,788        $8,855,618 ($14,361,896) $13,805,408 ($95,073,462) $13,782,245            ($6,030,215) $11,818,614      $37,891,910    $21,714,201
CUMULATIVE                                                                                         ($112,795,073) ($127,156,969) ($113,351,561) ($208,425,023) ($194,642,778) ($200,672,993) ($188,854,379) ($150,962,469) ($129,248,269)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0              $0             $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $5,907,628      $6,185,467      $6,473,654      $6,772,539     $7,082,484         $7,403,863            $7,737,061            $8,082,477            $8,440,521
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($2,428,194)    ($2,855,563)    ($3,302,843)    ($3,770,775)   ($4,260,121)       ($4,771,672)          ($5,306,244)          ($5,864,682)          ($6,447,858)
   Total Public Financing (inflated)                                              ($41,629,300)        $3,479,434      $3,329,904      $3,170,811      $3,001,764     $2,822,363         $2,632,191            $2,430,817            $2,217,795            $1,992,663
NET REVENUE AFTER PROP D AND CFD [11]                                             $983,946,332       $12,335,051    ($11,031,992)    $16,976,218 ($92,071,698) $16,604,608        ($3,398,023)              $14,249,431           $40,109,704            $23,706,864
CUMULATIVE                                                                                          ($37,905,121)   ($48,937,113)   ($31,960,895) ($124,032,593) ($107,427,984) ($110,826,008)             ($96,576,577)         ($56,466,872)          ($32,760,009)




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 2 of 5
Table B4 - Sensitivity 2                                                                                                                                                                                                           Senstivity 2 - Outside Grant
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                                Year
Item                                                                 Factor     Total (Yrs 0-30)        18              19              20             21              22                     23                   24                    25                    26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894     $12,485,480     $12,485,480    $12,485,480     $12,485,480          $12,485,480          $12,485,480           $12,485,480            $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830       $14,277,839     $14,277,839     $14,277,839    $14,277,839     $14,277,839          $14,277,839          $14,277,839           $14,277,839            $14,277,839
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0              $0              $0             $0              $0                   $0                   $0                    $0                     $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Other Funds (2009$)                                                                $40,000,000                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
  Total Revenues (2009$)                                                         $835,973,069        $26,394,733     $26,763,319     $26,763,319    $26,763,319     $26,763,319          $26,763,319          $26,763,319           $26,763,319            $26,763,319
  Total Revenues (inflated)                           3.0% /yr                  $1,683,169,422       $44,935,267     $46,929,643     $48,337,532    $49,787,658     $51,281,288          $52,819,726          $54,404,318           $56,036,447            $57,717,541

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
 Infrastructure [4]                                                                $46,000,000                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $74,251,430                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Park Space and Open Space                                                          $22,874,663                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000      $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                         $82,874,663        $4,500,000      $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000      $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000        $225,000        $450,000              $0                 $0                    $0                    $0                    $0                    $0
 Project Management                                    4% of development cost       $6,285,044         $180,000        $180,000        $360,000              $0                 $0                    $0                    $0                    $0                    $0
 Contingency                                          20% of development cost      $31,425,219         $900,000        $900,000       $1,800,000             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $47,566,567        $1,305,000      $1,305,000      $2,610,000             $0                 $0                    $0                    $0                    $0                    $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)             $0              $0             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                       $284,048,654       $19,282,845              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000       $200,000        $200,000              $200,000              $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000     $2,900,000      $2,900,000            $2,900,000           $2,900,000             $2,900,000           $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845      $8,905,000     $14,710,000      $3,100,000      $3,100,000           $3,100,000           $3,100,000            $3,100,000            $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $47,987,919     $15,614,971     $26,567,896      $5,766,913      $5,939,921           $6,118,118           $6,301,662            $6,490,712            $6,685,433
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024        $9,147,556      $9,540,515     $10,500,364             $0                 $0                    $0                    $0                    $0                    $0
IFD Pay As You Go (inflated)                                                       $23,093,720        $2,567,890      $2,779,790              $0             $0                 $0                    $0                    $0                    $0                    $0
  Total IFD Proceeds (inflated)                                                   $160,841,744       $11,715,446     $12,320,305     $10,500,364             $0                 $0                    $0                    $0                    $0                    $0
NET REVENUE BEFORE PROP D                                                         $976,901,788        $8,662,794     $43,634,976     $32,269,999    $44,020,745     $45,341,367         $46,701,608 $48,102,656                    $49,545,736           $51,032,108
CUMULATIVE                                                                                         ($120,585,475)   ($76,950,499)   ($44,680,499)     ($659,755)    $44,681,612         $91,383,220 $139,485,876                  $189,031,612          $240,063,720

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0             $0              $0                   $0                   $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $8,811,618      $9,196,206      $9,594,736             $0              $0                   $0                   $0                    $0                    $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($7,056,674)    ($7,692,062)    ($8,354,986)   ($8,354,986)    ($8,354,986)         ($8,354,986)         ($8,354,986)          ($8,354,986)          ($8,354,986)
   Total Public Financing (inflated)                                              ($41,629,300)        $1,754,944      $1,504,143      $1,239,750   ($8,354,986)    ($8,354,986)         ($8,354,986)         ($8,354,986)          ($8,354,986)          ($8,354,986)
NET REVENUE AFTER PROP D AND CFD [11]                                             $983,946,332       $10,417,738    $45,139,119     $33,509,749     $35,665,759     $36,986,381        $38,346,622 $39,747,670                     $41,190,750           $42,677,122
CUMULATIVE                                                                                          ($22,342,270)   $22,796,849     $56,306,598     $91,972,357    $128,958,738       $167,305,360 $207,053,031                   $248,243,781          $290,920,903




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 3 of 5
Table B4 - Sensitivity 2                                                                                                              Senstivity 2 - Outside Grant
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)       27              28              29               30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480     $12,485,480     $12,485,480      $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830      $14,277,839     $14,277,839     $14,277,839      $142,778,393
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0              $0              $0                $0
Proposition A Park Bond (2009$)                                                    $10,000,000               $0              $0              $0                $0
Other Funds (2009$)                                                                $40,000,000               $0              $0              $0                $0
  Total Revenues (2009$)                                                         $835,973,069       $26,763,319     $26,763,319     $26,763,319      $267,633,194
  Total Revenues (inflated)                           3.0% /yr                  $1,683,169,422      $59,449,067     $61,232,539     $63,069,515      $649,616,008

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0              $0                $0
 Infrastructure [4]                                                                $46,000,000               $0              $0              $0                $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0                $0
   Subtotal                                                                        $74,251,430               $0              $0              $0                $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000               $0              $0              $0                $0
Park Space and Open Space                                                          $22,874,663               $0              $0              $0                $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0                $0
  Subtotal                                                                         $82,874,663               $0              $0              $0                $0
Total Development Cost (2009$)                                                    $157,126,093               $0              $0              $0                $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305               $0              $0              $0                $0
 Project Management                                    4% of development cost       $6,285,044               $0              $0              $0                $0
 Contingency                                          20% of development cost      $31,425,219               $0              $0              $0                $0
   Subtotal                                                                        $47,566,567               $0              $0              $0                $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0              $0               $0                $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0              $0               $0                $0
  Subtotal                                                                       $284,048,654               $0              $0               $0                $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000        $200,000        $200,000        $200,000        $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000      $2,900,000      $2,900,000       $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000      $3,100,000      $3,100,000      $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $6,885,996      $7,092,576      $7,305,353      $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024               $0              $0              $0                $0
IFD Pay As You Go (inflated)                                                       $23,093,720               $0              $0              $0                $0
  Total IFD Proceeds (inflated)                                                   $160,841,744               $0              $0              $0                $0
NET REVENUE BEFORE PROP D                                                         $976,901,788      $52,563,071     $54,139,963     $55,764,162     $574,370,871
CUMULATIVE                                                                                         $292,626,792    $346,766,755    $402,530,917     $976,901,788

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0              $0                $0
Public Financing Available Now
Grants                                                                                       $0               $0              $0              $0                $0
Mello-Roos CFD (inflated)                                                          $120,924,765               $0              $0              $0                $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)     ($8,354,986)    ($8,233,736)    ($7,789,180)     ($19,434,738)
   Total Public Financing (inflated)                                              ($41,629,300)     ($8,354,986)    ($8,233,736)    ($7,789,180)     ($19,434,738)
NET REVENUE AFTER PROP D AND CFD [11]                                             $983,946,332      $44,208,085     $45,906,228     $47,974,982     $554,936,133
CUMULATIVE                                                                                         $335,128,988    $381,035,216    $429,010,199     $983,946,332




                                                                                                                                                                     P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                        Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                             P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen2.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5
SENSITIVITY 3
PUBLIC LOAN
Table B5 - Sensitivity 3                                                                                                  Sensitivity 3 - Public Loan
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                                NPV (at 15%)                       $2009 Summary
                                                                                                              [1]                                 [2]


REVENUES
New Construction Ground Lease Revenue                                                               $55,437,142                           $305,250,276
Interim Leasing Income                                                                              $10,623,793                            $15,950,000
Proposition A Park Bond                                                                             $10,000,000                            $10,000,000
Additional Public Debt (less debt service) (2009$)                                                  $18,235,704                           ($20,032,032)
Infrastructure Financing District Bond (65% of T.I.)                                                $29,880,245                            $95,699,330
Infrastructure Financing Pay As You Go                                                               $4,014,218                            $15,452,455
   Total Revenues                                                                                  $128,191,101                           $422,320,028
EXPENDITURES
Sitework Costs
Demolition                                                                                           $3,114,795                             $4,317,725
Infrastructure                                                                                      $32,076,218                            $46,000,000
Structured Parking                                                                                   $4,878,829                            $23,933,705
   Subtotal                                                                                         $40,069,842                            $74,251,430
Waterfront Improvements
Remediation                                                                                         $11,590,520                            $15,000,000
Park Space and Open Space                                                                           $12,661,348                            $22,874,663
Piers/Wharfs                                                                                         $7,866,045                            $45,000,000
  Subtotal                                                                                          $32,117,914                            $82,874,663
Soft Costs
Planning & Entitlement                                                                               $5,609,388                             $9,856,305
Project Management                                                                                   $2,887,510                             $6,285,044
Contingency                                                                                         $14,437,551                            $31,425,219
  Subtotal                                                                                          $22,934,449                            $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                       $95,122,205                           $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                     $148,633,125                           $355,060,817
(Less) Historic Tax Credits                                                                        ($29,726,625)                          ($71,012,163)
(Less) Historic Building Lease Revenue                                                             ($45,975,969)                         ($263,902,918)
  Subtotal                                                                                          $72,930,531                            $20,145,735
Ongoing Remediation Monitoring                                                                          $889,236                            $4,600,000
Base Rent To The Port                                                                               $24,935,963                            $87,000,000
   Total Expenditures                                                                              $193,877,935                           $316,438,395
NET REVENUE BEFORE PROP D                                                                          ($65,686,834)                          $105,881,634
IRR                                                                    8.4%

PROP D Bond                                                                                         $24,199,503                            $41,986,485

NET REVENUE AFTER PROP D                                                                           ($41,487,331)                          $147,868,119
IRR                                                                  10.0%
CFD Public Financing
Mello-Roos CFD                                                                                      $25,957,699                            $83,787,096
(Less) CFD Value Reduction @ 75%                                                                   ($13,063,867)                          ($88,291,020)
   Value of CFD                                                                                     $12,893,832                            ($4,503,925)
NET REVENUE AFTER CFD FINANCING                                                                    ($28,593,500)                          $143,364,194
IRR                                                                  11.0%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                  ($154.5)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                                          P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
Table B6 - Sensitivity 3                                                                                                                                                                                                          Sensitivity 3 - Public Loan
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                      Year
Item                                                                  Factor     NPV (at 15%)    Total (Yrs 0-30)       0                1               2               3              4                      5                      6                      7

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                                      $376,272,239               $0              $0      $1,377,441      $1,479,118      $1,479,118           $2,840,628             $3,762,080             $4,461,677
New Construction Ground Lease plus reversion value (2009$) [2]                                     $433,750,830               $0       $318,568       $1,439,530      $2,241,924      $3,044,318           $3,846,713             $4,649,107             $5,451,501
Interim Leasing Income (2009$) [3]                                                                  $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000      $2,030,000           $1,740,000             $1,450,000             $1,160,000
Proposition A Park Bond (2009$)                                                                     $10,000,000      $10,000,000              $0              $0               $0              $0                  $0                     $0                     $0
Additional Public Debt (less debt service) (2009$) [4]                                                $957,594                $0     $20,000,000     $18,630,429     ($2,659,362)    ($2,581,905)        ($2,506,704)           ($2,433,693)           ($2,362,809)
  Total Revenues (2009$)                                                                          $835,973,069       $10,000,000     $23,218,568     $24,057,399      $3,381,680      $3,971,532           $5,920,637             $7,427,494            $8,710,370
  Total Revenues (inflated)                            3.0% /yr                  $140,272,607    $1,582,715,865      $10,000,000     $23,915,125     $25,522,494      $3,695,254      $4,469,994           $6,863,641             $8,868,816           $10,712,656

EXPENDITURES
Sitework Costs (2009$)
Demolition                                                                                           $4,317,725               $0              $0      $1,439,242      $1,439,242      $1,439,242                   $0                     $0                     $0
Infrastructure [5]                                                                                  $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333      $6,133,333           $3,066,667             $3,066,667             $3,066,667
Structured Parking [6]                                 1,733 spaces                                 $23,933,705               $0              $0              $0              $0              $0                   $0                     $0                     $0
   Subtotal                                                                                         $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575      $7,572,575           $3,066,667             $3,066,667             $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                                         $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000      $2,500,000           $2,500,000                         $0                 $0
Park Space and Open Space                                                                           $22,874,663       $7,751,940              $0              $0              $0              $0                   $0                         $0         $6,033,769
Piers/Wharfs                                                                                        $45,000,000               $0              $0              $0              $0              $0                   $0                         $0                 $0
  Subtotal                                                                                          $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000      $2,500,000           $2,500,000                         $0         $6,033,769
Total Development Cost (2009$)                                                                     $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575     $10,072,575           $5,566,667             $3,066,667             $9,100,435
Soft Costs (constant 2009$)
Planning & Entitlement [7]                              5% of development cost                       $9,856,305       $2,819,264       $431,667        $503,629        $503,629        $503,629             $278,333                 $153,333             $455,022
Project Management                                      4% of development cost                       $6,285,044        $655,411        $345,333        $402,903        $402,903        $402,903             $222,667                 $122,667             $364,017
Contingency                                            20% of development cost                      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515      $2,014,515           $1,113,333                $613,333            $1,820,087
  Subtotal                                                                                          $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047      $2,921,047           $1,614,333                $889,333            $2,639,126
Rehabilitated Building Feasibility Gap
Rehabilitation [8]                                                                                $355,060,817               $0     $25,480,000      $4,560,150              $0      $51,620,656         $18,829,730           $33,088,424              $2,989,718
(Less) Historic Tax Credits                            20% of rehab cost                          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0     ($10,324,131)        ($3,765,946)          ($6,617,685)              ($597,944)
  Subtotal                                                                                        $284,048,654               $0     $20,384,000      $3,648,120              $0      $41,296,525         $15,063,784           $26,470,739              $2,391,775
Ongoing Remediation Monitoring (2009$) [1]                                                           $6,600,000              $0               $0              $0              $0                $0                     $0                     $0           $200,000
Base Rent To The Port (2009$) [1]                                                                  $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000      $2,900,000           $2,900,000             $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                                       $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622     $57,190,146          $25,144,784           $33,326,739            $17,231,336
  Total Expenditures (inflated)                        3.0% /yr                  $239,853,903     $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390     $64,368,014          $29,149,696           $39,793,869            $21,192,370
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [9]                                             $29,880,245      $137,748,024               $0              $0              $0      $3,014,828      $6,583,664           $4,940,969             $6,538,570             $6,409,731
IFD Pay As You Go (inflated)                                                       $4,014,218       $23,093,720               $0              $0         $60,840       $193,700        $293,410             $425,360               $554,710               $685,360
  Total IFD Proceeds (inflated)                                                   $33,894,463      $160,841,744               $0              $0         $60,840      $3,208,528      $6,877,074           $5,366,329             $7,093,280             $7,095,091
NET REVENUE BEFORE PROP D                                                        ($65,686,834)     $876,448,232     ($13,137,002)   ($11,538,505)     $4,851,501    ($10,463,608)   ($53,020,946) ($16,919,726) ($23,831,773)     ($3,384,623)
CUMULATIVE                                                                                                          ($13,137,002)   ($24,675,507)   ($19,824,007)   ($30,287,614)   ($83,308,560) ($100,228,286) ($124,060,059) ($127,444,682)

PROP D
Bond Proceeds (inflated) [10]                                                     $24,199,503       $48,673,844               $0              $0              $0              $0                $0        $48,673,844                         $0                     $0
Public Financing Available Now
Grants                                                                                      $0               $0               $0              $0              $0              $0              $0                   $0                     $0                     $0
Mello-Roos CFD (inflated)                                                          $25,957,699     $120,924,765               $0              $0              $0      $1,754,897      $6,434,220           $4,893,108             $5,132,850             $5,381,643
(Less) CFD Value Reduction @ 75% [11]                                            ($13,063,867)   ($162,554,065)               $0              $0              $0      ($121,250)      ($565,806)           ($903,883)           ($1,258,524)           ($1,630,355)
  Total Public Financing (inflated)                                                $12,893,832    ($41,629,300)               $0              $0              $0      $1,633,647      $5,868,414           $3,989,225             $3,874,326             $3,751,288
NET REVENUE AFTER PROP D AND CFD [12]                                            ($28,593,500)     $883,492,775     ($13,137,002)   ($11,538,505)     $4,851,501     ($8,829,961)   ($47,152,532)        $35,743,343          ($19,957,447)             $366,666
CUMULATIVE                                                                                                          ($13,137,002)   ($24,675,507)   ($19,824,007)   ($28,653,968)   ($75,806,499)       ($40,063,157)         ($60,020,604)          ($59,653,938)




                                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                      Page 1 of 5
Table B6 - Sensitivity 3                                                                                                                                                                                                            Sensitivity 3 - Public Loan
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                          Year
Item                                                                  Factor     NPV (at 15%)    Total (Yrs 0-30)         8               9              10              11              12                      13                    14                     15

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                                      $376,272,239        $4,599,633      $5,553,056      $5,664,159      $6,545,533      $6,569,322           $10,543,283            $10,734,533           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                                     $433,750,830        $6,253,896      $7,056,290      $7,858,684      $8,661,079      $9,463,473           $10,265,868            $11,068,262           $11,870,656
Interim Leasing Income (2009$) [3]                                                                  $15,950,000         $870,000        $580,000        $290,000               $0              $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                                     $10,000,000                 $0              $0              $0              $0              $0                    $0                    $0                     $0
Additional Public Debt (less debt service) (2009$) [4]                                                $957,594        ($2,293,989)    ($2,227,174)    ($2,162,305)    ($2,099,325)    ($2,038,179)          ($1,978,815)          ($1,921,180)           ($1,865,223)
  Total Revenues (2009$)                                                                          $835,973,069         $9,429,540     $10,962,172     $11,650,539     $13,107,287     $13,994,616           $18,830,336            $19,881,615           $22,122,328
  Total Revenues (inflated)                            3.0% /yr                  $140,272,607    $1,582,715,865       $11,945,059     $14,303,148     $15,657,350     $18,143,551     $19,952,976           $27,652,983            $30,072,727           $34,465,865

EXPENDITURES
Sitework Costs (2009$)
Demolition                                                                                           $4,317,725                $0              $0              $0              $0              $0                         $0                    $0                 $0
Infrastructure [5]                                                                                  $46,000,000        $3,066,667      $3,066,667              $0              $0              $0                         $0                    $0                 $0
Structured Parking [6]                                 1,733 spaces                                 $23,933,705                $0              $0              $0              $0      $7,977,902                         $0                    $0         $7,977,902
   Subtotal                                                                                         $74,251,430        $3,066,667      $3,066,667              $0              $0      $7,977,902                         $0                    $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                                         $15,000,000                $0              $0              $0              $0                  $0                 $0                    $0                     $0
Park Space and Open Space                                                                           $22,874,663                $0              $0        $926,374              $0                  $0         $5,275,624                    $0             $2,886,956
Piers/Wharfs                                                                                        $45,000,000                $0              $0              $0      $4,500,000                  $0         $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                                          $82,874,663                $0              $0        $926,374      $4,500,000                  $0         $9,775,624            $4,500,000             $7,386,956
Total Development Cost (2009$)                                                                     $157,126,093        $3,066,667      $3,066,667        $926,374      $4,500,000      $7,977,902             $9,775,624            $4,500,000           $15,364,858
Soft Costs (constant 2009$)
Planning & Entitlement [7]                              5% of development cost                       $9,856,305          $153,333        $153,333         $46,319       $225,000        $398,895               $488,781              $225,000               $768,243
Project Management                                      4% of development cost                       $6,285,044          $122,667        $122,667         $37,055       $180,000        $319,116               $391,025              $180,000               $614,594
Contingency                                            20% of development cost                      $31,425,219          $613,333        $613,333        $185,275       $900,000       $1,595,580             $1,955,125             $900,000              $3,072,972
  Subtotal                                                                                          $47,566,567          $889,333        $889,333        $268,649      $1,305,000      $2,313,591             $2,834,931            $1,305,000             $4,455,809
Rehabilitated Building Feasibility Gap
Rehabilitation [8]                                                                                $355,060,817       $23,077,713       $6,101,898    $33,142,366      $2,629,001      $94,204,246            $2,231,499           $33,001,860                         $0
(Less) Historic Tax Credits                            20% of rehab cost                          ($71,012,163)      ($4,615,543)     ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)            ($446,300)          ($6,600,372)                        $0
  Subtotal                                                                                        $284,048,654       $18,462,171       $4,881,518    $26,513,893      $2,103,201      $75,363,397            $1,785,199           $26,401,488                         $0
Ongoing Remediation Monitoring (2009$) [1]                                                           $6,600,000          $200,000        $200,000        $200,000        $200,000        $200,000               $200,000               $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                                  $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000      $2,900,000             $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                                       $608,441,313       $25,518,171     $11,937,518     $30,808,916     $11,008,201     $88,754,890           $17,495,754            $35,306,488           $22,920,666
  Total Expenditures (inflated)                        3.0% /yr                  $239,853,903     $867,109,378        $32,325,655     $15,575,753     $41,404,607     $15,237,924    $126,543,251          $25,693,105            $53,404,231           $35,709,651
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [9]                                             $29,880,245      $137,748,024        $6,474,151      $6,261,567      $7,382,464      $6,751,154      $7,221,416             $7,272,951           $12,587,553            $8,142,613
IFD Pay As You Go (inflated)                                                       $4,014,218       $23,093,720         $811,720        $960,700       $1,096,940      $1,242,670      $1,389,440             $1,643,460            $1,807,780            $2,013,830
  Total IFD Proceeds (inflated)                                                   $33,894,463      $160,841,744        $7,285,871      $7,222,267      $8,479,404      $7,993,824      $8,610,856             $8,916,411           $14,395,333           $10,156,443
NET REVENUE BEFORE PROP D                                                        ($65,686,834)     $876,448,232      ($13,094,726)    $5,949,661   ($17,267,852)   $10,899,451   ($97,979,419)   $10,876,289    ($8,936,171)    $8,912,657
CUMULATIVE                                                                                                          ($140,539,408) ($134,589,747) ($151,857,599) ($140,958,148) ($238,937,566) ($228,061,278) ($236,997,449) ($228,084,791)

PROP D
Bond Proceeds (inflated) [10]                                                     $24,199,503       $48,673,844                $0              $0              $0              $0                  $0                     $0                    $0                     $0
Public Financing Available Now
Grants                                                                                      $0               $0                 $0              $0              $0              $0              $0                    $0                    $0                     $0
Mello-Roos CFD (inflated)                                                          $25,957,699     $120,924,765         $5,639,796      $5,907,628      $6,185,467      $6,473,654      $6,772,539            $7,082,484            $7,403,863             $7,737,061
(Less) CFD Value Reduction @ 75% [11]                                            ($13,063,867)   ($162,554,065)       ($2,020,022)    ($2,428,194)    ($2,855,563)    ($3,302,843)    ($3,770,775)          ($4,260,121)          ($4,771,672)           ($5,306,244)
  Total Public Financing (inflated)                                                $12,893,832    ($41,629,300)         $3,619,774      $3,479,434      $3,329,904      $3,170,811      $3,001,764            $2,822,363            $2,632,191             $2,430,817
NET REVENUE AFTER PROP D AND CFD [12]                                            ($28,593,500)     $883,492,775       ($9,474,951)     $9,429,095    ($13,937,948)    $14,070,262   ($94,977,654)   $13,698,652    ($6,303,980)   $11,343,474
CUMULATIVE                                                                                                           ($69,128,890)   ($59,699,795)   ($73,637,743)   ($59,567,481) ($154,545,135) ($140,846,483) ($147,150,463) ($135,806,989)




                                                                                                                                                                                              P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                             Page 2 of 5
Table B6 - Sensitivity 3                                                                                                                                                                                                           Sensitivity 3 - Public Loan
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007


Item                                                                  Factor     NPV (at 15%)    Total (Yrs 0-30)        16              17              18               19              20                    21                    22                     23

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                                      $376,272,239       $12,116,894     $12,116,894     $12,116,894      $12,485,480     $12,485,480         $12,485,480            $12,485,480            $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                                     $433,750,830       $12,673,051     $13,475,445     $14,277,839      $14,277,839     $14,277,839         $14,277,839            $14,277,839            $14,277,839
Interim Leasing Income (2009$) [3]                                                                  $15,950,000                $0              $0              $0               $0              $0                  $0                     $0                     $0
Proposition A Park Bond (2009$)                                                                     $10,000,000                 $0              $0              $0               $0              $0                  $0                     $0                    $0
Additional Public Debt (less debt service) (2009$) [4]                                                $957,594        ($1,810,896)    ($1,758,151)    ($1,706,943)     ($1,657,226)    ($1,608,958)        ($1,562,095)           ($1,516,597)          ($1,472,424)
  Total Revenues (2009$)                                                                          $835,973,069        $22,979,049     $23,834,188     $24,687,790      $25,106,093     $25,154,362         $25,201,225            $25,246,723            $25,290,895
  Total Revenues (inflated)                            3.0% /yr                  $140,272,607    $1,582,715,865       $36,874,628     $39,394,281     $42,029,310      $44,023,686     $45,431,575         $46,881,701            $48,375,331            $49,913,770

EXPENDITURES
Sitework Costs (2009$)
Demolition                                                                                           $4,317,725                $0              $0              $0               $0                $0                    $0                      $0                    $0
Infrastructure [5]                                                                                  $46,000,000                $0              $0              $0               $0                $0                    $0                      $0                    $0
Structured Parking [6]                                 1,733 spaces                                 $23,933,705                $0      $7,977,902              $0               $0                $0                    $0                      $0                    $0
   Subtotal                                                                                         $74,251,430                $0      $7,977,902              $0               $0                $0                    $0                      $0                    $0
Waterfront Improvements (2009$)
Remediation                                                                                         $15,000,000                $0              $0              $0               $0              $0                      $0                      $0                    $0
Park Space and Open Space                                                                           $22,874,663                $0              $0              $0               $0              $0                      $0                      $0                    $0
Piers/Wharfs                                                                                        $45,000,000        $4,500,000      $4,500,000      $4,500,000       $4,500,000      $9,000,000                      $0                      $0                    $0
  Subtotal                                                                                          $82,874,663        $4,500,000      $4,500,000      $4,500,000       $4,500,000      $9,000,000                      $0                      $0                    $0
Total Development Cost (2009$)                                                                     $157,126,093        $4,500,000     $12,477,902      $4,500,000       $4,500,000      $9,000,000                      $0                      $0                    $0
Soft Costs (constant 2009$)
Planning & Entitlement [7]                              5% of development cost                       $9,856,305         $225,000        $623,895        $225,000         $225,000        $450,000                       $0                      $0                    $0
Project Management                                      4% of development cost                       $6,285,044         $180,000        $499,116        $180,000         $180,000        $360,000                       $0                      $0                    $0
Contingency                                            20% of development cost                      $31,425,219         $900,000       $2,495,580       $900,000         $900,000       $1,800,000                      $0                      $0                    $0
  Subtotal                                                                                          $47,566,567        $1,305,000      $3,618,591      $1,305,000       $1,305,000      $2,610,000                      $0                      $0                    $0
Rehabilitated Building Feasibility Gap
Rehabilitation [8]                                                                                $355,060,817                $0              $0     $24,103,556                $0               $0                     $0                     $0                    $0
(Less) Historic Tax Credits                            20% of rehab cost                          ($71,012,163)               $0              $0     ($4,820,711)               $0               $0                     $0                     $0                    $0
  Subtotal                                                                                        $284,048,654                $0              $0     $19,282,845                $0               $0                     $0                     $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                                           $6,600,000          $200,000        $200,000        $200,000         $200,000        $200,000             $200,000               $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                                  $113,100,000        $2,900,000      $2,900,000      $2,900,000       $2,900,000      $2,900,000           $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                                       $608,441,313        $8,905,000     $19,196,493     $28,187,845       $8,905,000     $14,710,000           $3,100,000             $3,100,000            $3,100,000
  Total Expenditures (inflated)                        3.0% /yr                  $239,853,903     $867,109,378       $14,289,911     $31,728,878     $47,987,919      $15,614,971     $26,567,896           $5,766,913             $5,939,921            $6,118,118
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [9]                                             $29,880,245      $137,748,024       $10,210,476      $8,767,482      $9,147,556       $9,540,515     $10,500,364                      $0                      $0                    $0
IFD Pay As You Go (inflated)                                                       $4,014,218       $23,093,720        $2,190,760      $2,375,360      $2,567,890       $2,779,790              $0                      $0                      $0                    $0
  Total IFD Proceeds (inflated)                                                   $33,894,463      $160,841,744       $12,401,236     $11,142,842     $11,715,446      $12,320,305     $10,500,364                      $0                      $0                    $0
NET REVENUE BEFORE PROP D                                                        ($65,686,834)     $876,448,232       $34,985,953    $18,808,244     $5,756,838        $40,729,019     $29,364,043        $41,114,788            $42,435,411            $43,795,652
CUMULATIVE                                                                                                          ($193,098,838) ($174,290,594) ($168,533,756)     ($127,804,737)   ($98,440,694)      ($57,325,906)          ($14,890,495)           $28,905,156

PROP D
Bond Proceeds (inflated) [10]                                                     $24,199,503       $48,673,844                $0              $0              $0               $0                $0                     $0                     $0                    $0
Public Financing Available Now
Grants                                                                                      $0               $0                 $0              $0              $0               $0              $0                  $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $25,957,699     $120,924,765         $8,082,477      $8,440,521      $8,811,618       $9,196,206      $9,594,736                  $0                     $0                    $0
(Less) CFD Value Reduction @ 75% [11]                                            ($13,063,867)   ($162,554,065)       ($5,864,682)    ($6,447,858)    ($7,056,674)     ($7,692,062)    ($8,354,986)        ($8,354,986)           ($8,354,986)          ($8,354,986)
  Total Public Financing (inflated)                                                $12,893,832    ($41,629,300)         $2,217,795      $1,992,663      $1,754,944       $1,504,143      $1,239,750        ($8,354,986)           ($8,354,986)          ($8,354,986)
NET REVENUE AFTER PROP D AND CFD [12]                                            ($28,593,500)     $883,492,775       $37,203,748     $20,800,907      $7,511,782      $42,233,163    $30,603,793         $32,759,802            $34,080,425           $35,440,666
CUMULATIVE                                                                                                           ($98,603,241)   ($77,802,334)   ($70,290,552)    ($28,057,389)    $2,546,403         $35,306,206            $69,386,630          $104,827,296




                                                                                                                                                                                           P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                          Page 3 of 5
Table B6 - Sensitivity 3                                                                                                                                                                                             Sensitivity 3 - Public Loan
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                   Year
Item                                                                  Factor     NPV (at 15%)    Total (Yrs 0-30)       24                 25              26              27              28                      29                        30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                                      $376,272,239      $12,485,480      $12,485,480       $12,485,480     $12,485,480     $12,485,480            $12,485,480              $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                                     $433,750,830      $14,277,839      $14,277,839       $14,277,839     $14,277,839     $14,277,839            $14,277,839              $142,778,393
Interim Leasing Income (2009$) [3]                                                                  $15,950,000               $0               $0                $0              $0              $0                     $0                        $0
Proposition A Park Bond (2009$)                                                                     $10,000,000                $0               $0                $0              $0              $0                     $0                        $0
Additional Public Debt (less debt service) (2009$) [4]                                                $957,594       ($1,429,538)     ($1,387,901)      ($1,347,477)    ($1,308,230)    ($1,270,126)           ($1,233,132)              ($8,462,107)
  Total Revenues (2009$)                                                                          $835,973,069       $25,333,781      $25,375,418       $25,415,843     $25,455,090     $25,493,193            $25,530,187              $259,171,087
  Total Revenues (inflated)                            3.0% /yr                  $140,272,607    $1,582,715,865      $51,498,361      $53,130,491       $54,811,584     $56,543,111     $58,326,583            $60,163,559              $629,076,254

EXPENDITURES
Sitework Costs (2009$)
Demolition                                                                                           $4,317,725               $0                 $0              $0              $0                  $0                      $0                        $0
Infrastructure [5]                                                                                  $46,000,000               $0                 $0              $0              $0                  $0                      $0                        $0
Structured Parking [6]                                 1,733 spaces                                 $23,933,705               $0                 $0              $0              $0                  $0                      $0                        $0
   Subtotal                                                                                         $74,251,430               $0                 $0              $0              $0                  $0                      $0                        $0
Waterfront Improvements (2009$)
Remediation                                                                                         $15,000,000               $0                 $0              $0              $0                  $0                      $0                        $0
Park Space and Open Space                                                                           $22,874,663               $0                 $0              $0              $0                  $0                      $0                        $0
Piers/Wharfs                                                                                        $45,000,000               $0                 $0              $0              $0                  $0                      $0                        $0
  Subtotal                                                                                          $82,874,663               $0                 $0              $0              $0                  $0                      $0                        $0
Total Development Cost (2009$)                                                                     $157,126,093               $0                 $0              $0              $0                  $0                      $0                        $0
Soft Costs (constant 2009$)
Planning & Entitlement [7]                              5% of development cost                       $9,856,305               $0                 $0              $0              $0                  $0                      $0                        $0
Project Management                                      4% of development cost                       $6,285,044               $0                 $0              $0              $0                  $0                      $0                        $0
Contingency                                            20% of development cost                      $31,425,219               $0                 $0              $0              $0                  $0                      $0                        $0
  Subtotal                                                                                          $47,566,567               $0                 $0              $0              $0                  $0                      $0                        $0
Rehabilitated Building Feasibility Gap
Rehabilitation [8]                                                                                $355,060,817                $0                 $0              $0              $0                 $0                      $0                        $0
(Less) Historic Tax Credits                            20% of rehab cost                          ($71,012,163)               $0                 $0              $0              $0                 $0                      $0                        $0
  Subtotal                                                                                        $284,048,654                $0                 $0              $0              $0                 $0                      $0                        $0
Ongoing Remediation Monitoring (2009$) [1]                                                           $6,600,000         $200,000           $200,000        $200,000        $200,000        $200,000                 $200,000               $2,000,000
Base Rent To The Port (2009$) [1]                                                                  $113,100,000       $2,900,000          $2,900,000     $2,900,000      $2,900,000      $2,900,000              $2,900,000               $29,000,000
  Total Expenditures (2009$)                                                                       $608,441,313        $3,100,000      $3,100,000         $3,100,000      $3,100,000      $3,100,000             $3,100,000               $31,000,000
  Total Expenditures (inflated)                        3.0% /yr                  $239,853,903     $867,109,378        $6,301,662      $6,490,712         $6,685,433      $6,885,996      $7,092,576             $7,305,353               $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [9]                                             $29,880,245      $137,748,024               $0                 $0              $0              $0                  $0                      $0                        $0
IFD Pay As You Go (inflated)                                                       $4,014,218       $23,093,720               $0                 $0              $0              $0                  $0                      $0                        $0
  Total IFD Proceeds (inflated)                                                   $33,894,463      $160,841,744               $0                 $0              $0              $0                  $0                      $0                        $0
NET REVENUE BEFORE PROP D                                                        ($65,686,834)     $876,448,232      $45,196,700     $46,639,779        $48,126,152     $49,657,115     $51,234,007           $52,858,206              $553,831,117
CUMULATIVE                                                                                                           $74,101,856    $120,741,636       $168,867,787    $218,524,902    $269,758,909          $322,617,114              $876,448,232

PROP D
Bond Proceeds (inflated) [10]                                                     $24,199,503       $48,673,844               $0                 $0              $0              $0                  $0                      $0                        $0
Public Financing Available Now
Grants                                                                                      $0               $0                $0               $0                $0              $0              $0                     $0                        $0
Mello-Roos CFD (inflated)                                                          $25,957,699     $120,924,765                $0               $0                $0              $0              $0                     $0                        $0
(Less) CFD Value Reduction @ 75% [11]                                            ($13,063,867)   ($162,554,065)      ($8,354,986)     ($8,354,986)      ($8,354,986)    ($8,354,986)    ($8,233,736)           ($7,789,180)             ($19,434,738)
  Total Public Financing (inflated)                                                $12,893,832    ($41,629,300)      ($8,354,986)     ($8,354,986)      ($8,354,986)    ($8,354,986)    ($8,233,736)           ($7,789,180)             ($19,434,738)
NET REVENUE AFTER PROP D AND CFD [12]                                            ($28,593,500)     $883,492,775      $36,841,714     $38,284,794        $39,771,166     $41,302,129     $43,000,271           $45,069,026              $534,396,379
CUMULATIVE                                                                                                          $141,669,010    $179,953,804       $219,724,970    $261,027,099    $304,027,370          $349,096,396              $883,492,775




                                                                                                                                                                                                P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed an annual debt service amortized over 30 years at 6 percent interest rate; the last several years of payments are rolled up into year 30.
[5] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[6] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[7] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[8] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[9] Infrastructure Financing District.
[10] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[11] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[12] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc




                                                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\Nov2009\17007feas 29Oct09_sensit3.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                      Page 5 of 5
              SENSITIVITY 4
GROUND LEASE SITE 1 FOR RENTAL RESIDENTIAL
Table B7 - Sensitivity 4                                                                         Sensitivity 4 - Ground Lease for Rental Residential
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                                   NPV (at 15%)                       $2009 Summary
                                                                                                                 [1]                                 [2]


REVENUES
New Construction Ground Lease Revenue                                                                  $48,657,434                           $279,091,015
Interim Leasing Income                                                                                 $10,623,793                            $15,950,000
Proposition A Park Bond                                                                                $10,000,000                            $10,000,000
Infrastructure Financing District Bond (65% of T.I.)                                                   $25,146,783                            $87,067,679
Infrastructure Financing Pay As You Go                                                                  $3,271,289                            $13,320,674
   Total Revenues                                                                                      $97,699,299                           $405,429,368
EXPENDITURES
Sitework Costs
Demolition                                                                                              $3,114,795                              $4,317,725
Infrastructure                                                                                         $32,076,218                             $46,000,000
Structured Parking                                                                                      $4,878,829                             $23,933,705
   Subtotal                                                                                            $40,069,842                             $74,251,430
Waterfront Improvements
Remediation                                                                                            $11,590,520                             $15,000,000
Park Space and Open Space                                                                              $12,661,348                             $22,874,663
Piers/Wharfs                                                                                            $7,866,045                             $45,000,000
  Subtotal                                                                                             $32,117,914                             $82,874,663
Soft Costs
Planning & Entitlement                                                                                  $5,609,388                              $9,856,305
Project Management                                                                                      $2,887,510                              $6,285,044
Contingency                                                                                            $14,437,551                             $31,425,219
  Subtotal                                                                                             $22,934,449                             $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                          $95,122,205                           $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                        $148,633,125                           $355,060,817
(Less) Historic Tax Credits                                                                           ($29,726,625)                          ($71,012,163)
(Less) Historic Building Lease Revenue                                                                ($45,975,969)                         ($263,902,918)
  Subtotal                                                                                             $72,930,531                            $20,145,735
Ongoing Remediation Monitoring                                                                             $889,236                                $4,600,000
Base Rent To The Port                                                                                  $24,935,963                             $87,000,000
   Total Expenditures                                                                                 $193,877,935                           $316,438,395
NET REVENUE BEFORE PROP D                                                                             ($96,178,636)                            $88,990,973
IRR                                                                      7.4%

PROP D Bond                                                                                            $21,926,684                             $38,043,111

NET REVENUE AFTER PROP D                                                                              ($74,251,952)                          $127,034,084
IRR                                                                      8.4%
CFD Public Financing
Mello-Roos CFD                                                                                         $21,243,611                             $75,190,727
(Less) CFD Value Reduction @ 75%                                                                      ($10,650,858)                           ($78,102,996)
   Value of CFD                                                                                        $10,592,753                             ($2,912,269)
NET REVENUE AFTER CFD FINANCING                                                                       ($63,659,200)                          $124,121,815
IRR                                                                      8.9%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                    ($195.9)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                          P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
Table B8 - Sensitivity 4                                                                                                                                                                          Sensitivity 4 - Ground Lease for Rental Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                    Year
Item                                                                 Factor     Total (Yrs 0-30)       0                1               2               3             4                      5                      6                     7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239               $0              $0      $1,377,441      $1,479,118     $1,479,118            $2,840,628            $3,762,080            $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $399,159,628               $0       $139,069        $642,627       $1,436,272     $2,229,918            $3,023,564            $3,817,209            $4,610,855            $5,404,501
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000     $2,030,000            $1,740,000            $1,450,000            $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000      $10,000,000              $0              $0              $0                $0                    $0                     $0                    $0                      $0
  Total Revenues (2009$)                                                         $801,381,867       $10,000,000      $3,039,069      $4,630,067      $5,235,391     $5,739,036            $7,604,192           $9,029,289           $10,232,532            $10,874,134
  Total Revenues (inflated)                           3.0% /yr                  $1,577,228,408      $10,000,000      $3,130,241      $4,912,039      $5,720,853     $6,459,336            $8,815,342          $10,781,443           $12,584,724            $13,775,027

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242     $1,439,242                    $0                    $0                    $0                    $0
 Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333     $6,133,333            $3,066,667            $3,066,667            $3,066,667            $3,066,667
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0              $0             $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575     $7,572,575            $3,066,667            $3,066,667            $3,066,667            $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000     $2,500,000            $2,500,000                        $0                $0                          $0
Park Space and Open Space                                                          $22,874,663       $7,751,940              $0              $0              $0             $0                    $0                        $0        $6,033,769                          $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0              $0             $0                    $0                        $0                $0                          $0
  Subtotal                                                                         $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000     $2,500,000            $2,500,000                        $0        $6,033,769                          $0
Total Development Cost (2009$)                                                    $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575    $10,072,575            $5,566,667            $3,066,667            $9,100,435            $3,066,667
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305       $2,819,264       $431,667        $503,629        $503,629       $503,629              $278,333               $153,333             $455,022                $153,333
 Project Management                                    4% of development cost       $6,285,044        $655,411        $345,333        $402,903        $402,903       $402,903              $222,667               $122,667             $364,017                $122,667
 Contingency                                          20% of development cost      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515     $2,014,515            $1,113,333              $613,333            $1,820,087               $613,333
   Subtotal                                                                        $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047     $2,921,047            $1,614,333              $889,333            $2,639,126               $889,333
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0     $25,480,000      $4,560,150              $0     $51,620,656         $18,829,730           $33,088,424             $2,989,718           $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0    ($10,324,131)        ($3,765,946)          ($6,617,685)             ($597,944)          ($4,615,543)
  Subtotal                                                                       $284,048,654               $0     $20,384,000      $3,648,120              $0     $41,296,525         $15,063,784           $26,470,739             $2,391,775           $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000             $0               $0              $0              $0                $0                    $0                     $0           $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000     $2,900,000            $2,900,000            $2,900,000            $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622    $57,190,146          $25,144,784           $33,326,739           $17,231,336            $25,518,171
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390    $64,368,014          $29,149,696           $39,793,869           $21,192,370            $32,325,655
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,247,660               $0              $0              $0      $2,473,705       $141,723            $4,767,036            $6,351,754            $6,216,473            $6,287,334
IFD Pay As You Go (inflated)                                                       $20,123,740               $0              $0         $49,920         $52,780       $148,980              $277,160              $402,610              $529,490              $651,820
  Total IFD Proceeds (inflated)                                                   $147,371,400               $0              $0         $49,920      $2,526,485       $290,703            $5,044,196            $6,754,364            $6,745,963            $6,939,154
NET REVENUE BEFORE PROP D                                                         $857,490,431     ($13,137,002)   ($32,323,389)   ($15,769,875)    ($9,120,051) ($57,617,975) ($15,290,157) ($22,258,062)      ($1,861,684) ($11,611,474)
CUMULATIVE                                                                                         ($13,137,002)   ($45,460,391)   ($61,230,266)   ($70,350,317) ($127,968,292) ($143,258,450) ($165,516,512) ($167,378,196) ($178,989,669)

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393               $0              $0              $0              $0                $0       $44,102,393                         $0                    $0                      $0
Public Financing Available Now
Grants                                                                                       $0              $0              $0              $0              $0              $0                   $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $110,467,034              $0              $0              $0      $1,212,793         $24,256           $4,714,655            $4,949,646            $5,193,557            $5,446,694
(Less) CFD Value Reduction @ 75% [10]                                            ($145,868,432)              $0              $0              $0       ($83,795)       ($85,471)           ($411,218)            ($753,201)          ($1,112,036)          ($1,488,361)
   Total Public Financing (inflated)                                              ($35,401,398)              $0              $0              $0      $1,128,998        -$61,215           $4,303,437            $4,196,445            $4,081,521            $3,958,332
NET REVENUE AFTER PROP D AND CFD [11]                                             $866,191,425     ($13,137,002)   ($32,323,389)   ($15,769,875)    ($7,991,053) ($57,679,190)         $33,115,673 ($18,061,618)      $2,219,837    ($7,653,141)
CUMULATIVE                                                                                         ($13,137,002)   ($45,460,391)   ($61,230,266)   ($69,221,319) ($126,900,509)       ($93,784,836) ($111,846,453) ($109,626,616) ($117,279,758)




                                                                                                                                                                      P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                         Page 1 of 5
Table B8 - Sensitivity 4                                                                                                                                                                          Sensitivity 4 - Ground Lease for Rental Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)         9             10             11              12             13                     14                    15                     16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056     $5,664,159     $6,545,533      $6,569,322    $10,543,283          $10,734,533            $12,116,894           $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $399,159,628        $6,198,146     $6,991,792     $7,785,438      $8,579,083     $9,372,729          $10,166,374            $10,960,020           $11,753,666           $12,547,311
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000       $290,000              $0              $0             $0                   $0                     $0                    $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0             $0             $0              $0                $0                     $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $801,381,867        $12,331,202    $12,945,951    $14,330,971     $15,148,405    $19,916,012          $20,900,907            $23,076,914           $23,870,560           $24,664,205
  Total Revenues (inflated)                           3.0% /yr                  $1,577,228,408       $16,089,421    $17,398,276    $19,837,415     $21,598,004    $29,247,335          $31,614,498            $35,953,080           $38,305,241           $40,766,174

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0             $0             $0              $0                $0                     $0                $0                        $0                 $0
 Infrastructure [4]                                                                $46,000,000        $3,066,667             $0             $0              $0                $0                     $0                $0                        $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0             $0             $0      $7,977,902                $0                     $0        $7,977,902                        $0         $7,977,902
   Subtotal                                                                        $74,251,430        $3,066,667             $0             $0      $7,977,902                $0                     $0        $7,977,902                        $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0             $0             $0              $0             $0                    $0                    $0                     $0                    $0
Park Space and Open Space                                                          $22,874,663                $0       $926,374             $0              $0     $5,275,624                    $0            $2,886,956                     $0                    $0
Piers/Wharfs                                                                       $45,000,000                $0             $0     $4,500,000              $0     $4,500,000            $4,500,000            $4,500,000             $4,500,000            $4,500,000
  Subtotal                                                                         $82,874,663                $0       $926,374     $4,500,000              $0     $9,775,624            $4,500,000            $7,386,956             $4,500,000            $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,066,667       $926,374     $4,500,000      $7,977,902     $9,775,624            $4,500,000           $15,364,858             $4,500,000          $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305          $153,333        $46,319      $225,000        $398,895       $488,781              $225,000              $768,243               $225,000              $623,895
 Project Management                                    4% of development cost       $6,285,044          $122,667        $37,055      $180,000        $319,116       $391,025              $180,000              $614,594               $180,000              $499,116
 Contingency                                          20% of development cost      $31,425,219          $613,333       $185,275      $900,000       $1,595,580     $1,955,125              $900,000            $3,072,972               $900,000            $2,495,580
   Subtotal                                                                        $47,566,567          $889,333       $268,649     $1,305,000      $2,313,591     $2,834,931            $1,305,000            $4,455,809             $1,305,000            $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366    $2,629,001      $94,204,246     $2,231,499         $33,001,860                         $0                    $0                     $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)    ($525,800)    ($18,840,849)     ($446,300)        ($6,600,372)                        $0                    $0                     $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893    $2,103,201      $75,363,397     $1,785,199         $26,401,488                         $0                    $0                     $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000       $200,000       $200,000        $200,000       $200,000               $200,000              $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000     $2,900,000     $2,900,000      $2,900,000     $2,900,000            $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $11,937,518    $30,808,916    $11,008,201     $88,754,890     $17,495,754         $35,306,488            $22,920,666            $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $15,575,753    $41,404,607    $15,237,924    $126,543,251    $25,693,105         $53,404,231            $35,709,651           $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,247,660        $6,061,866     $7,176,322     $6,538,570      $7,002,390     $7,060,367          $12,355,643             $7,904,262            $9,978,567            $8,522,688
IFD Pay As You Go (inflated)                                                       $20,123,740         $796,640       $928,590      $1,069,900      $1,212,380     $1,461,720           $1,621,230             $1,822,600            $1,994,590            $2,174,120
  Total IFD Proceeds (inflated)                                                   $147,371,400        $6,858,506     $8,104,912     $7,608,470      $8,214,770     $8,522,087          $13,976,873             $9,726,862           $11,973,157           $10,696,808
NET REVENUE BEFORE PROP D                                                         $857,490,431        $7,372,174 ($15,901,419) $12,207,961 ($96,730,477) $12,076,317            ($7,812,860)    $9,970,291    $35,988,487    $19,734,103
CUMULATIVE                                                                                         ($171,617,495) ($187,518,914) ($175,310,953) ($272,041,429) ($259,965,113) ($267,777,973) ($257,807,682) ($221,819,195) ($202,085,092)

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393                $0             $0             $0              $0                $0                     $0                    $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0                $0             $0             $0              $0             $0                   $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $110,467,034        $5,709,372     $5,981,915     $6,264,660      $6,557,954     $6,862,153           $7,177,627            $7,504,758             $7,843,939            $8,195,576
(Less) CFD Value Reduction @ 75% [10]                                            ($145,868,432)      ($1,882,836)   ($2,296,141)   ($2,728,982)    ($3,182,086)   ($3,656,209)         ($4,152,129)          ($4,670,651)           ($5,212,608)          ($5,778,860)
   Total Public Financing (inflated)                                              ($35,401,398)        $3,826,536     $3,685,774     $3,535,679      $3,375,867     $3,205,944           $3,025,498            $2,834,107             $2,631,331            $2,416,716
NET REVENUE AFTER PROP D AND CFD [11]                                             $866,191,425       $11,198,710 ($12,215,645) $15,743,640 ($93,354,610) $15,282,260            ($4,787,362) $12,804,398      $38,619,818    $22,150,819
CUMULATIVE                                                                                         ($106,081,048) ($118,296,693) ($102,553,052) ($195,907,662) ($180,625,401) ($185,412,763) ($172,608,366) ($133,988,548) ($111,837,729)




                                                                                                                                                                          P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                             Page 2 of 5
Table B8 - Sensitivity 4                                                                                                                                                                          Sensitivity 4 - Ground Lease for Rental Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                                        Year
Item                                                                 Factor     Total (Yrs 0-30)        18               19              20             21              22                   23                    24                   25                     26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894      $12,485,480     $12,485,480    $12,485,480     $12,485,480        $12,485,480           $12,485,480           $12,485,480           $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $399,159,628       $13,340,957      $13,340,957     $13,340,957    $13,340,957     $13,340,957        $13,340,957           $13,340,957           $13,340,957           $13,340,957
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0               $0              $0             $0              $0                 $0                    $0                    $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
  Total Revenues (2009$)                                                         $801,381,867        $25,457,851      $25,826,437     $25,826,437    $25,826,437     $25,826,437        $25,826,437           $25,826,437           $25,826,437           $25,826,437
  Total Revenues (inflated)                           3.0% /yr                  $1,577,228,408       $43,340,287      $45,286,814     $46,645,418    $48,044,781     $49,486,124        $50,970,708           $52,499,829           $54,074,824           $55,697,069

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
 Infrastructure [4]                                                                $46,000,000                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
   Subtotal                                                                        $74,251,430                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000       $4,500,000      $9,000,000             $0                $0                    $0                   $0                    $0                     $0
  Subtotal                                                                         $82,874,663        $4,500,000       $4,500,000      $9,000,000             $0                $0                    $0                   $0                    $0                     $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000       $4,500,000      $9,000,000             $0                $0                    $0                   $0                    $0                     $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000         $225,000        $450,000              $0                $0                    $0                   $0                    $0                     $0
 Project Management                                    4% of development cost       $6,285,044         $180,000         $180,000        $360,000              $0                $0                    $0                   $0                    $0                     $0
 Contingency                                          20% of development cost      $31,425,219         $900,000         $900,000       $1,800,000             $0                $0                    $0                   $0                    $0                     $0
   Subtotal                                                                        $47,566,567        $1,305,000       $1,305,000      $2,610,000             $0                $0                    $0                   $0                    $0                     $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556               $0              $0             $0                $0                    $0                   $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)              $0              $0             $0                $0                    $0                   $0                    $0                    $0
  Subtotal                                                                       $284,048,654       $19,282,845               $0              $0             $0                $0                    $0                   $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000         $200,000        $200,000       $200,000        $200,000             $200,000             $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000       $2,900,000      $2,900,000     $2,900,000      $2,900,000          $2,900,000           $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845       $8,905,000     $14,710,000      $3,100,000     $3,100,000          $3,100,000           $3,100,000            $3,100,000             $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $47,987,919      $15,614,971     $26,567,896      $5,766,913     $5,939,921          $6,118,118           $6,301,662            $6,490,712             $6,685,433
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,247,660        $8,896,320       $9,276,395     $10,236,244             $0                $0                    $0                   $0                    $0                     $0
IFD Pay As You Go (inflated)                                                       $20,123,740        $2,361,320       $2,567,890              $0             $0                $0                    $0                   $0                    $0                     $0
  Total IFD Proceeds (inflated)                                                   $147,371,400       $11,257,640      $11,844,285     $10,236,244             $0                $0                    $0                   $0                    $0                     $0
NET REVENUE BEFORE PROP D                                                         $857,490,431        $6,610,009      $41,516,127    $30,313,766   $42,277,867       $43,546,204       $44,852,590           $46,198,167          $47,584,112           $49,011,636
CUMULATIVE                                                                                         ($195,475,083)   ($153,958,956) ($123,645,190) ($81,367,322)     ($37,821,119)       $7,031,471           $53,229,638         $100,813,751          $149,825,386

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393                $0               $0              $0             $0                $0                    $0                   $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0                $0               $0              $0             $0              $0                 $0                   $0                    $0                     $0
Mello-Roos CFD (inflated)                                                          $110,467,034        $8,560,088       $8,937,909      $9,329,484             $0              $0                 $0                   $0                    $0                     $0
(Less) CFD Value Reduction @ 75% [10]                                            ($145,868,432)      ($6,370,297)     ($6,987,839)    ($7,632,436)   ($7,632,436)    ($7,632,436)       ($7,632,436)         ($7,632,436)          ($7,632,436)           ($7,632,436)
   Total Public Financing (inflated)                                              ($35,401,398)        $2,189,791       $1,950,070      $1,697,049   ($7,632,436)    ($7,632,436)       ($7,632,436)         ($7,632,436)          ($7,632,436)           ($7,632,436)
NET REVENUE AFTER PROP D AND CFD [11]                                             $866,191,425        $8,799,800      $43,466,197     $32,010,815    $34,645,432    $35,913,768        $37,220,154 $38,565,732                    $39,951,677           $41,379,200
CUMULATIVE                                                                                         ($103,037,929)    ($59,571,732)   ($27,560,918)    $7,084,514    $42,998,282        $80,218,436 $118,784,167                  $158,735,844          $200,115,044




                                                                                                                                                                         P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                            Page 3 of 5
Table B8 - Sensitivity 4                                                                                             Sensitivity 4 - Ground Lease for Rental Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)     27              28                  29                  30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480     $12,485,480         $12,485,480        $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $399,159,628      $13,340,957     $13,340,957         $13,340,957        $133,409,570
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0              $0                  $0                  $0
Proposition A Park Bond (2009$)                                                    $10,000,000               $0              $0                  $0                       $0
  Total Revenues (2009$)                                                         $801,381,867       $25,826,437     $25,826,437         $25,826,437        $258,264,371
  Total Revenues (inflated)                           3.0% /yr                  $1,577,228,408      $57,367,981     $59,089,020         $60,861,691        $626,875,414

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0                  $0                       $0
 Infrastructure [4]                                                                $46,000,000               $0              $0                  $0                       $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0                  $0                       $0
   Subtotal                                                                        $74,251,430               $0              $0                  $0                       $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000               $0              $0                  $0                       $0
Park Space and Open Space                                                          $22,874,663               $0              $0                  $0                       $0
Piers/Wharfs                                                                       $45,000,000               $0              $0                  $0                       $0
  Subtotal                                                                         $82,874,663               $0              $0                  $0                       $0
Total Development Cost (2009$)                                                    $157,126,093               $0              $0                  $0                       $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305               $0              $0                  $0                       $0
 Project Management                                    4% of development cost       $6,285,044               $0              $0                  $0                       $0
 Contingency                                          20% of development cost      $31,425,219               $0              $0                  $0                       $0
   Subtotal                                                                        $47,566,567               $0              $0                  $0                       $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0              $0                   $0                      $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0              $0                   $0                      $0
  Subtotal                                                                       $284,048,654               $0              $0                   $0                      $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000        $200,000        $200,000            $200,000          $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000      $2,900,000          $2,900,000         $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000      $3,100,000         $3,100,000         $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $6,885,996      $7,092,576         $7,305,353         $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,247,660               $0              $0                  $0                       $0
IFD Pay As You Go (inflated)                                                       $20,123,740               $0              $0                  $0                       $0
  Total IFD Proceeds (inflated)                                                   $147,371,400               $0              $0                  $0                       $0
NET REVENUE BEFORE PROP D                                                         $857,490,431      $50,481,985     $51,996,444        $53,556,338        $551,630,278
CUMULATIVE                                                                                         $200,307,371    $252,303,815       $305,860,153        $857,490,431

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393               $0              $0                  $0                       $0
Public Financing Available Now
Grants                                                                                       $0               $0              $0                  $0                  $0
Mello-Roos CFD (inflated)                                                          $110,467,034               $0              $0                  $0                  $0
(Less) CFD Value Reduction @ 75% [10]                                            ($145,868,432)     ($7,632,436)    ($7,548,641)        ($7,546,965)       ($18,860,621)
   Total Public Financing (inflated)                                              ($35,401,398)     ($7,632,436)    ($7,548,641)        ($7,546,965)       ($18,860,621)
NET REVENUE AFTER PROP D AND CFD [11]                                             $866,191,425      $42,849,549     $44,447,803        $46,009,373        $532,769,656
CUMULATIVE                                                                                         $242,964,593    $287,412,396       $333,421,769        $866,191,425




                                                                                                                                                                  P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                     Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                             P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen4.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5
          SENSITIVITY 5
SELL SITE 1 FOR-SALE RESIDENTIAL
Table B9 - Sensitivity 5                                                                                         Sensitivity 5 - Sell Land for Residential
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                                    NPV (at 15%)                        $2009 Summary
                                                                                                                  [1]                                  [2]


REVENUES
New Construction Ground Lease Revenue                                                                   $44,778,552                            $264,487,846
Interim Leasing Income                                                                                  $10,623,793                             $15,950,000
Proposition A Park Bond                                                                                 $10,000,000                             $10,000,000
Other Bonds                                                                                              $6,122,446                              $7,632,138
Infrastructure Financing District Bond (65% of T.I.)                                                    $25,535,655                             $87,689,663
Infrastructure Financing Pay As You Go                                                                   $3,333,597                             $13,485,298
   Total Revenues                                                                                      $100,394,044                            $399,244,945
EXPENDITURES
Sitework Costs
Demolition                                                                                               $3,114,795                                 $4,317,725
Infrastructure                                                                                          $32,076,218                                $46,000,000
Structured Parking                                                                                       $4,878,829                                $23,933,705
   Subtotal                                                                                             $40,069,842                                $74,251,430
Waterfront Improvements
Remediation                                                                                             $11,590,520                                $15,000,000
Park Space and Open Space                                                                               $12,661,348                                $22,874,663
Piers/Wharfs                                                                                             $7,866,045                                $45,000,000
  Subtotal                                                                                              $32,117,914                                $82,874,663
Soft Costs
Planning & Entitlement                                                                                   $5,609,388                                 $9,856,305
Project Management                                                                                       $2,887,510                                 $6,285,044
Contingency                                                                                             $14,437,551                                $31,425,219
  Subtotal                                                                                              $22,934,449                                $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                           $95,122,205                            $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                         $148,633,125                            $355,060,817
(Less) Historic Tax Credits                                                                            ($29,726,625)                           ($71,012,163)
(Less) Historic Building Lease Revenue                                                                 ($45,975,969)                          ($263,902,918)
  Subtotal                                                                                              $72,930,531                             $20,145,735
Ongoing Remediation Monitoring                                                                              $889,236                                $4,600,000
Base Rent To The Port                                                                                   $24,935,963                                $87,000,000
   Total Expenditures                                                                                  $193,877,935                            $316,438,395
NET REVENUE BEFORE PROP D                                                                              ($93,483,891)                               $82,806,550
IRR                                                                      7.3%

PROP D Bond                                                                                             $21,926,684                                $38,043,111

NET REVENUE AFTER PROP D                                                                               ($71,557,207)                           $120,849,661
IRR                                                                      8.4%
CFD Public Financing
Mello-Roos CFD                                                                                          $21,630,802                                 $75,811,297
(Less) CFD Value Reduction @ 75%                                                                       ($10,849,265)                               ($78,846,218)
   Value of CFD                                                                                         $10,781,537                                 ($3,034,921)
NET REVENUE AFTER CFD FINANCING                                                                        ($60,775,670)                           $117,814,740
IRR                                                                      8.9%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                    ($193.7)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                          P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen5.xls
Table B10 - Sensitivity 5                                                                                                                                                                                         Sensitivity 5 - Sell Land for Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                    Year
Item                                                                 Factor     Total (Yrs 0-30)       0                1               2               3             4                     5                     6                      7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239               $0              $0      $1,377,441      $1,479,118     $1,479,118          $2,840,628            $3,762,080             $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $380,024,441               $0       $139,069        $139,069        $932,715      $1,726,361          $2,520,006            $3,313,652             $4,107,297            $4,900,943
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000     $2,030,000          $1,740,000            $1,450,000             $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000      $10,000,000              $0              $0              $0              $0                     $0                    $0                    $0                     $0
For-Sale Residential Land Sales                                                     $7,632,138               $0              $0      $7,632,138              $0              $0                     $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $782,246,680       $10,000,000      $3,039,069     $11,758,648      $4,731,833     $5,235,479          $7,100,634            $8,525,731            $9,728,974           $10,370,576
  Total Revenues (inflated)                           3.0% /yr                  $1,550,167,941      $10,000,000      $3,130,241     $12,474,750      $5,170,602     $5,892,578          $8,231,581           $10,180,169           $11,965,411           $13,137,135

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242     $1,439,242                  $0                    $0                     $0                    $0
 Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333     $6,133,333          $3,066,667            $3,066,667             $3,066,667            $3,066,667
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0              $0             $0                  $0                    $0                     $0                    $0
   Subtotal                                                                        $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575     $7,572,575          $3,066,667            $3,066,667             $3,066,667            $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000     $2,500,000          $2,500,000                        $0                 $0                        $0
Park Space and Open Space                                                          $22,874,663       $7,751,940              $0              $0              $0             $0                  $0                        $0         $6,033,769                        $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0              $0             $0                  $0                        $0                 $0                        $0
  Subtotal                                                                         $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000     $2,500,000          $2,500,000                        $0         $6,033,769                        $0
Total Development Cost (2009$)                                                    $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575    $10,072,575          $5,566,667            $3,066,667             $9,100,435            $3,066,667
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305       $2,819,264       $431,667        $503,629        $503,629       $503,629            $278,333                $153,333             $455,022                $153,333
 Project Management                                    4% of development cost       $6,285,044        $655,411        $345,333        $402,903        $402,903       $402,903            $222,667                $122,667             $364,017                $122,667
 Contingency                                          20% of development cost      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515     $2,014,515          $1,113,333               $613,333            $1,820,087               $613,333
   Subtotal                                                                        $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047     $2,921,047          $1,614,333               $889,333            $2,639,126               $889,333
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0     $25,480,000      $4,560,150              $0     $51,620,656       $18,829,730            $33,088,424             $2,989,718          $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0    ($10,324,131)      ($3,765,946)           ($6,617,685)             ($597,944)         ($4,615,543)
  Subtotal                                                                       $284,048,654               $0     $20,384,000      $3,648,120              $0     $41,296,525       $15,063,784            $26,470,739             $2,391,775          $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000             $0               $0              $0              $0              $0                     $0                    $0           $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622    $57,190,146        $25,144,784            $33,326,739           $17,231,336           $25,518,171
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390    $64,368,014        $29,149,696            $39,793,869           $21,192,370           $32,325,655
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,975,599               $0              $0              $0      $2,995,503       $154,607          $4,773,478            $6,364,638             $6,229,357            $6,293,776
IFD Pay As You Go (inflated)                                                       $20,349,160               $0              $0         $60,450         $63,570       $159,900            $288,340              $414,050               $541,060              $663,650
  Total IFD Proceeds (inflated)                                                   $148,324,759               $0              $0         $60,450      $3,059,073       $314,507          $5,061,818            $6,778,688             $6,770,417            $6,957,426
NET REVENUE BEFORE PROP D                                                         $831,383,323     ($13,137,002)   ($32,323,389)    ($8,196,634)    ($9,137,715) ($58,160,930) ($15,856,297) ($22,835,013)      ($2,456,542) ($12,231,094)
CUMULATIVE                                                                                         ($13,137,002)   ($45,460,391)   ($53,657,025)   ($62,794,740) ($120,955,670) ($136,811,966) ($159,646,979) ($162,103,521) ($174,334,614)

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393               $0              $0              $0              $0              $0       $44,102,393                         $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0              $0              $0              $0              $0             $0                  $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $111,194,270              $0              $0              $0      $1,732,158        $34,643          $4,725,250            $4,960,452             $5,204,580            $5,457,937
(Less) CFD Value Reduction @ 75% [10]                                            ($147,048,245)              $0              $0              $0      ($119,679)     ($122,073)          ($448,552)            ($791,281)           ($1,150,878)          ($1,527,980)
   Total Public Financing (inflated)                                              ($35,853,976)              $0              $0              $0      $1,612,479       -$87,429          $4,276,699            $4,169,171             $4,053,702            $3,929,957
NET REVENUE AFTER PROP D AND CFD [11]                                             $839,631,740     ($13,137,002)   ($32,323,389)    ($8,196,634)    ($7,525,237) ($58,248,359)       $32,522,795 ($18,665,841)      $1,597,160    ($8,301,137)
CUMULATIVE                                                                                         ($13,137,002)   ($45,460,391)   ($53,657,025)   ($61,182,262) ($119,430,620)     ($86,907,826) ($105,573,667) ($103,976,507) ($112,277,644)




                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen5.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                          Page 1 of 5
Table B10 - Sensitivity 5                                                                                                                                                                                        Sensitivity 5 - Sell Land for Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                              Year
Item                                                                 Factor     Total (Yrs 0-30)         9             10              11              12             13                   14                    15                    16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056     $5,664,159      $6,545,533      $6,569,322    $10,543,283        $10,734,533           $12,116,894            $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $380,024,441        $5,694,589     $6,488,234      $7,281,880      $8,075,526     $8,869,171         $9,662,817           $10,456,463            $11,250,108           $12,043,754
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000       $290,000               $0              $0             $0                 $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0             $0              $0              $0              $0                    $0                     $0                    $0                    $0
For-Sale Residential Land Sales                                                     $7,632,138                $0             $0              $0              $0              $0                    $0                     $0                    $0                    $0
  Total Revenues (2009$)                                                         $782,246,680        $11,827,644    $12,442,394     $13,827,413     $14,644,848    $19,412,454        $20,397,350           $22,573,357            $23,367,002           $24,160,648
  Total Revenues (inflated)                           3.0% /yr                  $1,550,167,941       $15,432,393    $16,721,536     $19,140,374     $20,880,051    $28,507,844        $30,852,822           $35,168,554            $37,497,179           $39,933,870

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0             $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Infrastructure [4]                                                                $46,000,000        $3,066,667             $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0             $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
   Subtotal                                                                        $74,251,430        $3,066,667             $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0             $0              $0              $0             $0                  $0                    $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0       $926,374              $0              $0     $5,275,624                  $0            $2,886,956                    $0                     $0
Piers/Wharfs                                                                       $45,000,000                $0             $0      $4,500,000              $0     $4,500,000          $4,500,000            $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                         $82,874,663                $0       $926,374      $4,500,000              $0     $9,775,624          $4,500,000            $7,386,956            $4,500,000             $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,066,667       $926,374      $4,500,000      $7,977,902     $9,775,624          $4,500,000          $15,364,858             $4,500,000           $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305          $153,333        $46,319       $225,000        $398,895       $488,781            $225,000              $768,243              $225,000               $623,895
 Project Management                                    4% of development cost       $6,285,044          $122,667        $37,055       $180,000        $319,116       $391,025            $180,000              $614,594              $180,000               $499,116
 Contingency                                          20% of development cost      $31,425,219          $613,333       $185,275       $900,000       $1,595,580     $1,955,125            $900,000            $3,072,972              $900,000             $2,495,580
   Subtotal                                                                        $47,566,567          $889,333       $268,649      $1,305,000      $2,313,591     $2,834,931          $1,305,000            $4,455,809            $1,305,000             $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366     $2,629,001      $94,204,246     $2,231,499       $33,001,860                         $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)     ($525,800)    ($18,840,849)     ($446,300)      ($6,600,372)                        $0                    $0                    $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893     $2,103,201      $75,363,397     $1,785,199       $26,401,488                         $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000       $200,000        $200,000        $200,000       $200,000            $200,000              $200,000               $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000     $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $11,937,518    $30,808,916     $11,008,201     $88,754,890     $17,495,754       $35,306,488           $22,920,666             $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $15,575,753    $41,404,607     $15,237,924    $126,543,251    $25,693,105       $53,404,231           $35,709,651            $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,975,599        $6,074,750     $7,189,206      $6,551,454      $7,015,274     $7,066,809        $12,374,969             $7,917,145            $9,991,450            $8,535,572
IFD Pay As You Go (inflated)                                                       $20,349,160         $808,730       $940,940       $1,082,510      $1,225,120     $1,474,850         $1,634,620             $1,836,250            $2,008,500            $2,188,290
  Total IFD Proceeds (inflated)                                                   $148,324,759        $6,883,480     $8,130,146      $7,633,964      $8,240,394     $8,541,659        $14,009,589             $9,753,395           $11,999,950           $10,723,862
NET REVENUE BEFORE PROP D                                                         $831,383,323        $6,740,120 ($16,552,925) $11,536,414 ($97,422,806) $11,356,397            ($8,541,820)    $9,212,298    $35,207,219    $18,928,853
CUMULATIVE                                                                                         ($167,594,494) ($184,147,419) ($172,611,005) ($270,033,811) ($258,677,413) ($267,219,233) ($258,006,935) ($222,799,717) ($203,870,863)

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393                $0             $0              $0              $0              $0                    $0                     $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0             $0              $0              $0             $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $111,194,270        $5,720,840     $5,993,613      $6,276,592      $6,570,124     $6,874,567         $7,190,289            $7,517,673            $7,857,112            $8,209,013
(Less) CFD Value Reduction @ 75% [10]                                            ($147,048,245)      ($1,923,247)   ($2,337,361)    ($2,771,025)    ($3,224,971)   ($3,699,952)       ($4,196,746)          ($4,716,161)          ($5,259,028)          ($5,826,208)
   Total Public Financing (inflated)                                              ($35,853,976)        $3,797,593     $3,656,252      $3,505,567      $3,345,153     $3,174,615         $2,993,543            $2,801,513            $2,598,085            $2,382,804
NET REVENUE AFTER PROP D AND CFD [11]                                             $839,631,740       $10,537,713 ($12,896,672)      $15,041,981 ($94,077,653) $14,531,012        ($5,548,278) $12,013,811      $37,805,303    $21,311,658
CUMULATIVE                                                                                         ($101,739,931) ($114,636,604)   ($99,594,623) ($193,672,276) ($179,141,264) ($184,689,541) ($172,675,730) ($134,870,427) ($113,558,769)




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        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                              Page 2 of 5
Table B10 - Sensitivity 5                                                                                                                                                                                           Sensitivity 5 - Sell Land for Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                                 Year
Item                                                                 Factor     Total (Yrs 0-30)        18               19              20             21              22                     23                   24                    25                    26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894      $12,485,480     $12,485,480    $12,485,480     $12,485,480          $12,485,480          $12,485,480           $12,485,480            $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $380,024,441       $12,837,399      $12,837,399     $12,837,399    $12,837,399     $12,837,399          $12,837,399          $12,837,399           $12,837,399            $12,837,399
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0               $0              $0             $0              $0                   $0                   $0                    $0                     $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
For-Sale Residential Land Sales                                                     $7,632,138                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
  Total Revenues (2009$)                                                         $782,246,680        $24,954,294      $25,322,879     $25,322,879    $25,322,879     $25,322,879          $25,322,879          $25,322,879           $25,322,879            $25,322,879
  Total Revenues (inflated)                           3.0% /yr                  $1,550,167,941       $42,483,014      $44,403,822     $45,735,937    $47,108,015     $48,521,256          $49,976,893          $51,476,200           $53,020,486            $54,611,101

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
 Infrastructure [4]                                                                $46,000,000                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $74,251,430                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Park Space and Open Space                                                          $22,874,663                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000       $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                         $82,874,663        $4,500,000       $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000       $4,500,000      $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000         $225,000        $450,000              $0                 $0                    $0                    $0                    $0                    $0
 Project Management                                    4% of development cost       $6,285,044         $180,000         $180,000        $360,000              $0                 $0                    $0                    $0                    $0                    $0
 Contingency                                          20% of development cost      $31,425,219         $900,000         $900,000       $1,800,000             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $47,566,567        $1,305,000       $1,305,000      $2,610,000             $0                 $0                    $0                    $0                    $0                    $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)              $0              $0             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                       $284,048,654       $19,282,845               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000         $200,000        $200,000       $200,000        $200,000              $200,000              $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000       $2,900,000      $2,900,000     $2,900,000      $2,900,000            $2,900,000           $2,900,000             $2,900,000           $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845       $8,905,000     $14,710,000      $3,100,000     $3,100,000            $3,100,000           $3,100,000            $3,100,000            $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $47,987,919      $15,614,971     $26,567,896      $5,766,913     $5,939,921            $6,118,118           $6,301,662            $6,490,712            $6,685,433
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,975,599        $8,909,204       $9,289,279     $10,249,128             $0                 $0                    $0                    $0                    $0                    $0
IFD Pay As You Go (inflated)                                                       $20,349,160        $2,375,750       $2,582,580              $0             $0                 $0                    $0                    $0                    $0                    $0
  Total IFD Proceeds (inflated)                                                   $148,324,759       $11,284,954      $11,871,859     $10,249,128             $0                 $0                    $0                    $0                    $0                    $0
NET REVENUE BEFORE PROP D                                                         $831,383,323        $5,780,050      $40,660,710    $29,417,169   $41,341,102       $42,581,335         $43,858,775          $45,174,538           $46,529,775           $47,925,668
CUMULATIVE                                                                                         ($198,090,813)   ($157,430,103) ($128,012,934) ($86,671,832)     ($44,090,497)          ($231,722)         $44,942,816           $91,472,591          $139,398,259

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393                $0               $0              $0             $0                 $0                    $0                    $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0               $0              $0             $0              $0                   $0                   $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $111,194,270        $8,573,794       $8,951,889      $9,343,744             $0              $0                   $0                   $0                    $0                    $0
(Less) CFD Value Reduction @ 75% [10]                                            ($147,048,245)      ($6,418,593)     ($7,037,100)    ($7,682,682)   ($7,682,682)    ($7,682,682)         ($7,682,682)         ($7,682,682)          ($7,682,682)          ($7,682,682)
   Total Public Financing (inflated)                                              ($35,853,976)        $2,155,201       $1,914,788      $1,661,062   ($7,682,682)    ($7,682,682)         ($7,682,682)         ($7,682,682)          ($7,682,682)          ($7,682,682)
NET REVENUE AFTER PROP D AND CFD [11]                                             $839,631,740        $7,935,251      $42,575,498     $31,078,231    $33,658,420    $34,898,653          $36,176,093 $37,491,856                    $38,847,092           $40,242,986
CUMULATIVE                                                                                         ($105,623,518)    ($63,048,020)   ($31,969,789)    $1,688,630    $36,587,283          $72,763,376 $110,255,233                  $149,102,325          $189,345,311




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        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                Page 3 of 5
Table B10 - Sensitivity 5                                                                                                   Sensitivity 5 - Sell Land for Residential
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)       27              28                29                30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480     $12,485,480       $12,485,480      $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $380,024,441      $12,837,399     $12,837,399       $12,837,399      $128,373,994
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0              $0                $0                $0
Proposition A Park Bond (2009$)                                                    $10,000,000               $0               $0               $0                 $0
For-Sale Residential Land Sales                                                     $7,632,138               $0               $0               $0                 $0
  Total Revenues (2009$)                                                         $782,246,680       $25,322,879     $25,322,879       $25,322,879      $253,228,795
  Total Revenues (inflated)                           3.0% /yr                  $1,550,167,941      $56,249,434     $57,936,917       $59,675,024      $614,652,750

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0               $0               $0                 $0
 Infrastructure [4]                                                                $46,000,000               $0               $0               $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0               $0               $0                 $0
   Subtotal                                                                        $74,251,430               $0               $0               $0                 $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000               $0               $0               $0                 $0
Park Space and Open Space                                                          $22,874,663               $0               $0               $0                 $0
Piers/Wharfs                                                                       $45,000,000               $0               $0               $0                 $0
  Subtotal                                                                         $82,874,663               $0               $0               $0                 $0
Total Development Cost (2009$)                                                    $157,126,093               $0               $0               $0                 $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305               $0               $0               $0                 $0
 Project Management                                    4% of development cost       $6,285,044               $0               $0               $0                 $0
 Contingency                                          20% of development cost      $31,425,219               $0               $0               $0                 $0
   Subtotal                                                                        $47,566,567               $0               $0               $0                 $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0               $0                $0                 $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0               $0                $0                 $0
  Subtotal                                                                       $284,048,654               $0               $0                $0                 $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000        $200,000        $200,000          $200,000         $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000      $2,900,000        $2,900,000        $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000      $3,100,000       $3,100,000        $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $6,885,996      $7,092,576       $7,305,353        $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $127,975,599               $0               $0               $0                 $0
IFD Pay As You Go (inflated)                                                       $20,349,160               $0               $0               $0                 $0
  Total IFD Proceeds (inflated)                                                   $148,324,759               $0               $0               $0                 $0
NET REVENUE BEFORE PROP D                                                         $831,383,323      $49,363,438     $50,844,341      $52,369,671       $539,407,614
CUMULATIVE                                                                                         $188,761,697    $239,606,038     $291,975,709       $831,383,323

PROP D
Bond Proceeds (inflated) [9]                                                       $44,102,393               $0               $0               $0                 $0
Public Financing Available Now
Grants                                                                                       $0               $0              $0               $0                 $0
Mello-Roos CFD (inflated)                                                          $111,194,270               $0              $0               $0                 $0
(Less) CFD Value Reduction @ 75% [10]                                            ($147,048,245)     ($7,682,682)    ($7,563,003)     ($7,560,610)      ($18,892,340)
   Total Public Financing (inflated)                                              ($35,853,976)     ($7,682,682)    ($7,563,003)     ($7,560,610)      ($18,892,340)
NET REVENUE AFTER PROP D AND CFD [11]                                             $839,631,740      $41,680,756     $43,281,338      $44,809,062       $520,515,274
CUMULATIVE                                                                                         $231,026,066    $274,307,404     $319,116,466       $839,631,740




                                                                                                                                                                        P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen5.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                           Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




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         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5
       SENSITIVITY 6
SELL SITE 1 FOR COMMERCIAL
Table B11 - Sensitivity 6                                                                       Sensitivity 6 - Sell Land for Commercial Use
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                             NPV (at 15%)                     $2009 Summary
                                                                                                           [1]                               [2]


REVENUES
New Construction Ground Lease Revenue                                                             $46,802,421                        $272,742,378
Interim Leasing Income                                                                            $10,623,793                         $15,950,000
Proposition A Park Bond                                                                           $10,000,000                         $10,000,000
Other Bonds                                                                                       $10,579,149                         $13,187,788
Infrastructure Financing District Bond (65% of T.I.)                                              $30,553,014                         $96,777,022
Infrastructure Financing Pay As You Go                                                             $4,121,983                         $15,737,176
   Total Revenues                                                                                $112,680,360                        $424,394,364
EXPENDITURES
Sitework Costs
Demolition                                                                                         $3,114,795                           $4,317,725
Infrastructure                                                                                    $32,076,218                          $46,000,000
Structured Parking                                                                                 $4,878,829                          $23,933,705
   Subtotal                                                                                       $40,069,842                          $74,251,430
Waterfront Improvements
Remediation                                                                                       $11,590,520                          $15,000,000
Park Space and Open Space                                                                         $12,661,348                          $22,874,663
Piers/Wharfs                                                                                       $7,866,045                          $45,000,000
  Subtotal                                                                                        $32,117,914                          $82,874,663
Soft Costs
Planning & Entitlement                                                                             $5,609,388                           $9,856,305
Project Management                                                                                 $2,887,510                           $6,285,044
Contingency                                                                                       $14,437,551                          $31,425,219
  Subtotal                                                                                        $22,934,449                          $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                     $95,122,205                        $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                   $148,633,125                        $355,060,817
(Less) Historic Tax Credits                                                                      ($29,726,625)                       ($71,012,163)
(Less) Historic Building Lease Revenue                                                           ($45,975,969)                      ($263,902,918)
  Subtotal                                                                                        $72,930,531                         $20,145,735
Ongoing Remediation Monitoring                                                                       $889,236                           $4,600,000
Base Rent To The Port                                                                             $24,935,963                          $87,000,000
   Total Expenditures                                                                            $193,877,935                        $316,438,395
NET REVENUE BEFORE PROP D                                                                        ($81,197,575)                       $107,955,969
IRR                                                                   8.0%

PROP D Bond                                                                                       $24,199,503                          $41,986,485

NET REVENUE AFTER PROP D                                                                         ($56,998,072)                       $149,942,455
IRR                                                                   9.3%
CFD Public Financing
Mello-Roos CFD                                                                                    $26,626,738                          $84,859,397
(Less) CFD Value Reduction @ 75%                                                                 ($13,406,701)                        ($89,575,255)
   Value of CFD                                                                                   $13,220,037                          ($4,715,858)
NET REVENUE AFTER CFD FINANCING                                                                  ($43,778,035)                       $145,226,597
IRR                                                                  10.1%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                  ($165.4)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                           P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
Table B12 - Sensitivity 6                                                                                                                                                                                  Sensitivity 6 - Sell Land for Commercial Use
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                     Year
Item                                                                 Factor     Total (Yrs 0-30)       0                1               2               3              4                     5                     6                      7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239               $0              $0      $1,377,441      $1,479,118      $1,479,118          $2,840,628            $3,762,080             $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $391,154,275               $0       $318,568        $318,568       $1,120,962      $1,923,356          $2,725,751            $3,528,145             $4,330,539            $5,132,934
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0      $2,900,000      $2,610,000      $2,320,000      $2,030,000          $1,740,000            $1,450,000             $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000      $10,000,000              $0              $0              $0               $0                     $0                    $0                    $0                     $0
Commercial Land Sales (2009$)                                                      $13,187,788               $0              $0     $13,187,788              $0               $0                     $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $793,376,514       $10,000,000      $3,218,568     $17,493,796      $4,920,080      $5,432,475          $7,306,379            $8,740,225            $9,952,216           $10,602,567
  Total Revenues (inflated)                           3.0% /yr                  $1,577,078,978      $10,000,000      $3,315,125     $18,559,168      $5,376,305      $6,114,298          $8,470,095           $10,436,285           $12,239,971           $13,431,014

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0      $1,439,242      $1,439,242      $1,439,242                  $0                    $0                     $0                    $0
 Infrastructure [4]                                                                $46,000,000       $6,133,333      $6,133,333      $6,133,333      $6,133,333      $6,133,333          $3,066,667            $3,066,667             $3,066,667            $3,066,667
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
   Subtotal                                                                        $74,251,430       $6,133,333      $6,133,333      $7,572,575      $7,572,575      $7,572,575          $3,066,667            $3,066,667             $3,066,667            $3,066,667
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $2,500,000      $2,500,000      $2,500,000      $2,500,000      $2,500,000          $2,500,000                        $0                 $0                        $0
Park Space and Open Space                                                          $22,874,663       $7,751,940              $0              $0              $0              $0                  $0                        $0         $6,033,769                        $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0              $0              $0                  $0                        $0                 $0                        $0
  Subtotal                                                                         $82,874,663      $10,251,940      $2,500,000      $2,500,000      $2,500,000      $2,500,000          $2,500,000                        $0         $6,033,769                        $0
Total Development Cost (2009$)                                                    $157,126,093      $16,385,273      $8,633,333     $10,072,575     $10,072,575     $10,072,575          $5,566,667            $3,066,667             $9,100,435            $3,066,667
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305       $2,819,264       $431,667        $503,629        $503,629        $503,629            $278,333                $153,333             $455,022                $153,333
 Project Management                                    4% of development cost       $6,285,044        $655,411        $345,333        $402,903        $402,903        $402,903            $222,667                $122,667             $364,017                $122,667
 Contingency                                          20% of development cost      $31,425,219       $3,277,055      $1,726,667      $2,014,515      $2,014,515      $2,014,515          $1,113,333               $613,333            $1,820,087               $613,333
   Subtotal                                                                        $47,566,567       $6,751,729      $2,503,667      $2,921,047      $2,921,047      $2,921,047          $1,614,333               $889,333            $2,639,126               $889,333
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0     $25,480,000      $4,560,150              $0      $51,620,656       $18,829,730            $33,088,424             $2,989,718          $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0     ($5,096,000)      ($912,030)             $0     ($10,324,131)      ($3,765,946)           ($6,617,685)             ($597,944)         ($4,615,543)
  Subtotal                                                                       $284,048,654               $0     $20,384,000      $3,648,120              $0      $41,296,525       $15,063,784            $26,470,739             $2,391,775          $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000             $0               $0              $0              $0               $0                     $0                    $0           $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000              $0       $2,900,000      $2,900,000      $2,900,000      $2,900,000          $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313      $23,137,002     $34,421,000     $19,541,742     $15,893,622     $57,190,146        $25,144,784            $33,326,739           $17,231,336           $25,518,171
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $23,137,002     $35,453,630     $20,731,834     $17,367,390     $64,368,014        $29,149,696            $39,793,869           $21,192,370           $32,325,655
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $139,010,644               $0              $0              $0      $3,916,700      $6,602,990          $4,960,295            $6,557,896             $6,422,615            $6,499,918
IFD Pay As You Go (inflated)                                                       $23,483,590               $0              $0         $79,040       $212,290        $312,390             $444,730              $574,340               $705,510              $832,260
  Total IFD Proceeds (inflated)                                                   $162,494,234               $0              $0         $79,040      $4,128,990      $6,915,380          $5,405,025            $7,132,236             $7,128,125            $7,332,178
NET REVENUE BEFORE PROP D                                                         $872,463,835     ($13,137,002)   ($32,138,505)    ($2,093,625)    ($7,862,095) ($51,338,336) ($15,274,576) ($22,225,348)      ($1,824,274) ($11,562,463)
CUMULATIVE                                                                                         ($13,137,002)   ($45,275,507)   ($47,369,133)   ($55,231,228) ($106,569,564) ($121,844,140) ($144,069,488) ($145,893,762) ($157,456,225)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0              $0              $0               $0       $48,673,844                         $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0              $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $122,181,376              $0              $0              $0      $2,652,321      $6,452,168          $4,911,415            $5,151,523             $5,400,690            $5,659,224
(Less) CFD Value Reduction @ 75% [10]                                            ($164,592,698)              $0              $0              $0      ($183,255)      ($629,051)          ($968,393)          ($1,324,324)           ($1,697,471)          ($2,088,481)
   Total Public Financing (inflated)                                              ($42,411,321)              $0              $0              $0      $2,469,066      $5,823,117          $3,943,022            $3,827,199             $3,703,219            $3,570,743
NET REVENUE AFTER PROP D AND CFD [11]                                             $878,726,357     ($13,137,002)   ($32,138,505)    ($2,093,625)    ($5,393,029)   ($45,515,219)      $37,342,290           ($18,398,149)           $1,878,945           ($7,991,719)
CUMULATIVE                                                                                         ($13,137,002)   ($45,275,507)   ($47,369,133)   ($52,762,162)   ($98,277,381)     ($60,935,090)          ($79,333,240)         ($77,454,295)         ($85,446,014)




                                                                                                                                                                        P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                           Page 1 of 5
Table B12 - Sensitivity 6                                                                                                                                                                                  Sensitivity 6 - Sell Land for Commercial Use
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)         9              10              11              12             13                   14                    15                    16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056      $5,664,159      $6,545,533      $6,569,322    $10,543,283        $10,734,533           $12,116,894            $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $391,154,275        $5,935,328      $6,737,722      $7,540,117      $8,342,511     $9,144,906         $9,947,300           $10,749,694            $11,552,089           $12,354,483
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000        $290,000               $0              $0             $0                 $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Commercial Land Sales (2009$)                                                      $13,187,788                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
  Total Revenues (2009$)                                                         $793,376,514        $12,068,384     $12,691,882     $14,085,650     $14,911,833    $19,688,189        $20,681,833           $22,866,588            $23,668,983           $24,471,377
  Total Revenues (inflated)                           3.0% /yr                  $1,577,078,978       $15,746,503     $17,056,828     $19,497,834     $21,260,709    $28,912,769        $31,283,128           $35,625,400            $37,981,769           $40,447,458

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Infrastructure [4]                                                                $46,000,000        $3,066,667              $0              $0              $0              $0                    $0                 $0                        $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
   Subtotal                                                                        $74,251,430        $3,066,667              $0              $0      $7,977,902              $0                    $0         $7,977,902                        $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0              $0              $0              $0             $0                  $0                    $0                    $0                     $0
Park Space and Open Space                                                          $22,874,663                $0        $926,374              $0              $0     $5,275,624                  $0            $2,886,956                    $0                     $0
Piers/Wharfs                                                                       $45,000,000                $0              $0      $4,500,000              $0     $4,500,000          $4,500,000            $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                         $82,874,663                $0        $926,374      $4,500,000              $0     $9,775,624          $4,500,000            $7,386,956            $4,500,000             $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,066,667        $926,374      $4,500,000      $7,977,902     $9,775,624          $4,500,000          $15,364,858             $4,500,000           $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305          $153,333         $46,319       $225,000        $398,895       $488,781            $225,000              $768,243              $225,000               $623,895
 Project Management                                    4% of development cost       $6,285,044          $122,667         $37,055       $180,000        $319,116       $391,025            $180,000              $614,594              $180,000               $499,116
 Contingency                                          20% of development cost      $31,425,219          $613,333        $185,275       $900,000       $1,595,580     $1,955,125            $900,000            $3,072,972              $900,000             $2,495,580
   Subtotal                                                                        $47,566,567          $889,333        $268,649      $1,305,000      $2,313,591     $2,834,931          $1,305,000            $4,455,809            $1,305,000             $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366      $2,629,001      $94,204,246     $2,231,499       $33,001,860                         $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)     ($446,300)      ($6,600,372)                        $0                    $0                    $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893      $2,103,201      $75,363,397     $1,785,199       $26,401,488                         $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000        $200,000       $200,000            $200,000              $200,000               $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $11,937,518     $30,808,916     $11,008,201     $88,754,890     $17,495,754       $35,306,488           $22,920,666             $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $15,575,753     $41,404,607     $15,237,924    $126,543,251    $25,693,105       $53,404,231           $35,709,651            $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $139,010,644        $6,280,892      $7,401,790      $6,770,480      $7,240,742     $7,298,719        $12,606,878            $8,161,939            $10,236,244            $8,793,249
IFD Pay As You Go (inflated)                                                       $23,483,590         $981,630       $1,118,260      $1,264,380      $1,411,670     $1,666,080         $1,830,790            $2,037,360             $2,214,810            $2,399,930
  Total IFD Proceeds (inflated)                                                   $162,494,234        $7,262,522      $8,520,050      $8,034,860      $8,652,412     $8,964,799        $14,437,668           $10,199,299            $12,451,054           $11,193,179
NET REVENUE BEFORE PROP D                                                         $872,463,835        $7,433,272 ($15,827,729) $12,294,770 ($96,630,130) $12,184,463            ($7,683,434) $10,115,047      $36,142,912    $19,911,759
CUMULATIVE                                                                                         ($150,022,952) ($165,850,682) ($153,555,911) ($250,186,042) ($238,001,579) ($245,685,013) ($235,569,966) ($199,427,053) ($179,515,294)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0              $0             $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $122,181,376        $5,927,444      $6,205,680      $6,494,271      $6,793,569     $7,103,934         $7,425,742            $7,759,378            $8,105,240            $8,463,739
(Less) CFD Value Reduction @ 75% [10]                                            ($164,592,698)      ($2,498,022)    ($2,926,788)    ($3,375,493)    ($3,844,877)   ($4,335,705)       ($4,848,767)          ($5,384,882)          ($5,944,892)          ($6,529,673)
   Total Public Financing (inflated)                                              ($42,411,321)        $3,429,422      $3,278,893      $3,118,779      $2,948,692     $2,768,229         $2,576,975            $2,374,496            $2,160,347            $1,934,067
NET REVENUE AFTER PROP D AND CFD [11]                                             $878,726,357       $10,862,695    ($12,548,837)    $15,413,549 ($93,681,438) $14,952,692        ($5,106,460) $12,489,544      $38,303,260                              $21,845,826
CUMULATIVE                                                                                          ($74,583,319)   ($87,132,156)   ($71,718,607) ($165,400,045) ($150,447,353) ($155,553,813) ($143,064,270) ($104,761,010)                            ($82,915,184)




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 2 of 5
Table B12 - Sensitivity 6                                                                                                                                                                                   Sensitivity 6 - Sell Land for Commercial Use
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                                           Year
Item                                                                 Factor     Total (Yrs 0-30)        18               19             20             21              22                     23                   24                    25                    26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894      $12,485,480    $12,485,480    $12,485,480     $12,485,480          $12,485,480          $12,485,480           $12,485,480            $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $391,154,275       $13,156,877      $13,156,877    $13,156,877    $13,156,877     $13,156,877          $13,156,877          $13,156,877           $13,156,877            $13,156,877
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0               $0             $0             $0              $0                   $0                   $0                    $0                     $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Commercial Land Sales (2009$)                                                      $13,187,788                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
  Total Revenues (2009$)                                                         $793,376,514        $25,273,772      $25,642,357    $25,642,357    $25,642,357     $25,642,357          $25,642,357          $25,642,357           $25,642,357            $25,642,357
  Total Revenues (inflated)                           3.0% /yr                  $1,577,078,978       $43,026,904      $44,964,029    $46,312,950    $47,702,338     $49,133,408          $50,607,411          $52,125,633           $53,689,402            $55,300,084

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
 Infrastructure [4]                                                                $46,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $74,251,430                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Park Space and Open Space                                                          $22,874,663                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                         $82,874,663        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000         $225,000       $450,000              $0                 $0                    $0                    $0                    $0                    $0
 Project Management                                    4% of development cost       $6,285,044         $180,000         $180,000       $360,000              $0                 $0                    $0                    $0                    $0                    $0
 Contingency                                          20% of development cost      $31,425,219         $900,000         $900,000      $1,800,000             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $47,566,567        $1,305,000       $1,305,000     $2,610,000             $0                 $0                    $0                    $0                    $0                    $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)              $0             $0             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                       $284,048,654       $19,282,845               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000         $200,000       $200,000       $200,000        $200,000              $200,000              $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000       $2,900,000     $2,900,000     $2,900,000      $2,900,000            $2,900,000           $2,900,000            $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845       $8,905,000     $14,710,000     $3,100,000     $3,100,000            $3,100,000           $3,100,000            $3,100,000            $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378       $47,987,919      $15,614,971     $26,567,896     $5,766,913     $5,939,921            $6,118,118           $6,301,662            $6,490,712            $6,685,433
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $139,010,644        $9,173,324       $9,559,840    $10,526,132             $0                 $0                    $0                    $0                    $0                    $0
IFD Pay As You Go (inflated)                                                       $23,483,590        $2,592,850       $2,805,270             $0             $0                 $0                    $0                    $0                    $0                    $0
  Total IFD Proceeds (inflated)                                                   $162,494,234       $11,766,174      $12,365,110    $10,526,132             $0                 $0                    $0                    $0                    $0                    $0
NET REVENUE BEFORE PROP D                                                         $872,463,835        $6,805,159      $41,714,168    $30,271,185   $41,935,425      $43,193,488         $44,489,293          $45,823,971           $47,198,690           $48,614,651
CUMULATIVE                                                                                         ($172,710,135)   ($130,995,967) ($100,724,782) ($58,789,357)    ($15,595,869)        $28,893,424          $74,717,395          $121,916,085          $170,530,737

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0               $0             $0             $0              $0                   $0                   $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $122,181,376        $8,835,301       $9,220,362     $9,619,375             $0              $0                   $0                   $0                    $0                    $0
(Less) CFD Value Reduction @ 75% [10]                                            ($164,592,698)      ($7,140,125)     ($7,777,182)   ($8,441,808)   ($8,441,808)    ($8,441,808)         ($8,441,808)         ($8,441,808)          ($8,441,808)          ($8,441,808)
   Total Public Financing (inflated)                                              ($42,411,321)        $1,695,176       $1,443,180     $1,177,567   ($8,441,808)    ($8,441,808)         ($8,441,808)         ($8,441,808)          ($8,441,808)          ($8,441,808)
NET REVENUE AFTER PROP D AND CFD [11]                                             $878,726,357        $8,500,335      $43,157,348    $31,448,752    $33,493,617    $34,751,680         $36,047,484 $37,382,163                     $38,756,882           $40,172,843
CUMULATIVE                                                                                          ($74,414,849)    ($31,257,501)     $191,251     $33,684,868    $68,436,548        $104,484,032 $141,866,195                   $180,623,078          $220,795,921




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 3 of 5
Table B12 - Sensitivity 6                                                                                                         Sensitivity 6 - Sell Land for Commercial Use
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)     27                28                    29                   30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480       $12,485,480            $12,485,480         $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $391,154,275      $13,156,877       $13,156,877            $13,156,877         $131,568,774
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0                $0                     $0                   $0
Proposition A Park Bond (2009$)                                                    $10,000,000                 $0                $0                    $0                      $0
Commercial Land Sales (2009$)                                                      $13,187,788                 $0                $0                    $0                      $0
  Total Revenues (2009$)                                                         $793,376,514       $25,642,357       $25,642,357            $25,642,357         $256,423,574
  Total Revenues (inflated)                           3.0% /yr                  $1,577,078,978      $56,959,087       $58,667,859            $60,427,895         $622,407,319

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                 $0                $0                    $0                      $0
 Infrastructure [4]                                                                $46,000,000                 $0                $0                    $0                      $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                 $0                $0                    $0                      $0
   Subtotal                                                                        $74,251,430                 $0                $0                    $0                      $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                 $0                $0                    $0                      $0
Park Space and Open Space                                                          $22,874,663                 $0                $0                    $0                      $0
Piers/Wharfs                                                                       $45,000,000                 $0                $0                    $0                      $0
  Subtotal                                                                         $82,874,663                 $0                $0                    $0                      $0
Total Development Cost (2009$)                                                    $157,126,093                 $0                $0                    $0                      $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305                 $0                $0                    $0                      $0
 Project Management                                    4% of development cost       $6,285,044                 $0                $0                    $0                      $0
 Contingency                                          20% of development cost      $31,425,219                 $0                $0                    $0                      $0
   Subtotal                                                                        $47,566,567                 $0                $0                    $0                      $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817                  $0                $0                    $0                     $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)                 $0                $0                    $0                     $0
  Subtotal                                                                       $284,048,654                  $0                $0                    $0                     $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000           $200,000          $200,000              $200,000         $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000        $2,900,000             $2,900,000          $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000        $3,100,000            $3,100,000          $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $867,109,378        $6,885,996        $7,092,576            $7,305,353          $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $139,010,644                 $0                $0                    $0                      $0
IFD Pay As You Go (inflated)                                                       $23,483,590                 $0                $0                    $0                      $0
  Total IFD Proceeds (inflated)                                                   $162,494,234                 $0                $0                    $0                      $0
NET REVENUE BEFORE PROP D                                                         $872,463,835      $50,073,091       $51,575,283           $53,122,542         $547,162,182
CUMULATIVE                                                                                         $220,603,827      $272,179,111          $325,301,653         $872,463,835

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                 $0                $0                    $0                      $0
Public Financing Available Now
Grants                                                                                       $0               $0                $0                     $0                   $0
Mello-Roos CFD (inflated)                                                          $122,181,376               $0                $0                     $0                   $0
(Less) CFD Value Reduction @ 75% [10]                                            ($164,592,698)     ($8,441,808)      ($8,258,553)           ($7,812,757)        ($19,489,544)
   Total Public Financing (inflated)                                              ($42,411,321)     ($8,441,808)      ($8,258,553)           ($7,812,757)        ($19,489,544)
NET REVENUE AFTER PROP D AND CFD [11]                                             $878,726,357      $41,631,283       $43,316,731           $45,309,785         $527,672,638
CUMULATIVE                                                                                         $262,427,204      $305,743,934          $351,053,719         $878,726,357




                                                                                                                                                                  P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                     Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




                                                                                                                                                                                             P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen6.xls
         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5
                 SENSITIVITY 7
MATCH RATE OF NEW DEVELOPMENT ABSORPTION WITH
         INFRASTRUCTURE COST OUTLAYS
Table B13 - Sensitivity 7                                                                                         Sensitivity 7 - Spread Costs
Sources and Uses Table
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                                             NPV (at 15%)                    $2009 Summary
                                                                                                           [1]                              [2]


REVENUES
New Construction Ground Lease Revenue                                                             $55,437,142                      $305,250,276
Interim Leasing Income                                                                            $10,623,793                       $15,950,000
Proposition A Park Bond                                                                           $10,000,000                       $10,000,000
Infrastructure Financing District Bond (65% of T.I.)                                              $29,880,245                       $95,699,330
Infrastructure Financing Pay As You Go                                                             $4,014,218                       $15,452,455
   Total Revenues                                                                               $109,955,397                       $442,352,060
EXPENDITURES
Sitework Costs
Demolition                                                                                         $1,971,644                         $4,317,725
Infrastructure                                                                                    $21,005,421                        $46,000,000
Structured Parking                                                                                 $4,878,829                        $23,933,705
   Subtotal                                                                                       $27,855,894                        $74,251,430
Waterfront Improvements
Remediation                                                                                        $6,849,594                        $15,000,000
Park Space and Open Space                                                                         $12,661,348                        $22,874,663
Piers/Wharfs                                                                                       $7,866,045                        $45,000,000
  Subtotal                                                                                        $27,376,987                        $82,874,663
Soft Costs
Planning & Entitlement                                                                             $4,761,644                         $9,856,305
Project Management                                                                                 $2,209,315                         $6,285,044
Contingency                                                                                       $11,046,576                        $31,425,219
  Subtotal                                                                                        $18,017,536                        $47,566,567
Subtotal Sitework, Waterfront, and Soft Costs                                                     $73,250,417                      $204,692,660
Rehabilitated Building Feasibility Gap
Rehabilitation                                                                                  $148,633,125                        $355,060,817
(Less) Historic Tax Credits                                                                     ($29,726,625)                       ($71,012,163)
(Less) Historic Building Lease Revenue                                                          ($45,975,969)                      ($263,902,918)
  Subtotal                                                                                       $72,930,531                         $20,145,735
Ongoing Remediation Monitoring                                                                       $889,236                         $4,600,000
Base Rent To The Port                                                                             $24,935,963                        $87,000,000
   Total Expenditures                                                                           $172,006,146                       $316,438,395
NET REVENUE BEFORE PROP D                                                                        ($62,050,749)                     $125,913,666
IRR                                                                    8.7%

PROP D Bond                                                                                       $24,199,503                        $41,986,485

NET REVENUE AFTER PROP D                                                                         ($37,851,246)                     $167,900,151
IRR                                                                   10.4%
CFD Public Financing
Mello-Roos CFD                                                                                    $25,957,699                        $83,787,096
(Less) CFD Value Reduction @ 75%                                                                 ($13,063,867)                      ($88,291,020)
   Value of CFD                                                                                   $12,893,832                        ($4,503,925)
NET REVENUE AFTER CFD FINANCING                                                                  ($24,957,415)                     $163,396,226
IRR                                                                   11.5%

MAXIMUM CUMULATIVE NEGATIVE
Millions, Nominal                                                   ($160.9)

[1] Net present value is based on the discounted project cash flow in nominal dollars.
[2] Reversion values for new construction ground lease and rehabilitated buildings excluded. Similarly, capitalized costs of ongoing remediation
  monitoring and base rent to Port are excluded.
Sources: Economic & Planning Systems, Inc.




Economic & Planning Systems, Inc. 1/11/2010                           P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen7.xls
Table B14 - Sensitivity 7                                                                                                                                                                                                         Sensitivity 7 - Spread Costs
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                    Year
Item                                                                 Factor     Total (Yrs 0-30)      0                1               2               3              4                     5                     6                      7                     8

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239              $0              $0      $1,377,441      $1,479,118      $1,479,118          $2,840,628            $3,762,080             $4,461,677            $4,599,633
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830              $0       $318,568       $1,439,530      $2,241,924      $3,044,318          $3,846,713            $4,649,107             $5,451,501            $6,253,896
Interim Leasing Income (2009$) [3]                                                 $15,950,000              $0      $2,900,000      $2,610,000      $2,320,000      $2,030,000          $1,740,000            $1,450,000             $1,160,000             $870,000
Proposition A Park Bond (2009$)                                                    $10,000,000     $10,000,000              $0              $0              $0                $0                    $0                    $0                    $0                     $0
  Total Revenues (2009$)                                                         $835,973,069      $10,000,000      $3,218,568      $5,426,970      $6,041,042      $6,553,437          $8,427,341            $9,861,187           $11,073,178           $11,723,529
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422     $10,000,000      $3,315,125      $5,757,473      $6,601,210      $7,375,951          $9,769,597           $11,774,773           $13,618,613           $14,851,015

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725       $104,238        $337,241        $233,003        $233,003        $233,003            $233,003              $233,003               $233,003              $233,003
 Infrastructure [4]                                                                $46,000,000      $1,110,529      $3,592,887      $2,482,358      $2,482,358      $2,482,358          $2,482,358            $2,482,358             $2,482,358            $2,482,358
 Structured Parking [5]                               1,733 spaces                 $23,933,705              $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
   Subtotal                                                                        $74,251,430      $1,214,767      $3,930,128      $2,715,361      $2,715,361      $2,715,361          $2,715,361            $2,715,361             $2,715,361            $2,715,361
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000       $362,129       $1,171,594        $809,465        $809,465        $809,465             $809,465              $809,465             $809,465                $809,465
Park Space and Open Space                                                          $22,874,663      $7,751,940              $0              $0              $0              $0                   $0                    $0            $6,033,769                     $0
Piers/Wharfs                                                                       $45,000,000              $0              $0              $0              $0              $0                   $0                    $0                    $0                     $0
  Subtotal                                                                         $82,874,663      $8,114,068      $1,171,594        $809,465        $809,465        $809,465             $809,465              $809,465            $6,843,233               $809,465
Total Development Cost (2009$)                                                    $157,126,093      $9,328,835      $5,101,722      $3,524,826      $3,524,826      $3,524,826          $3,524,826            $3,524,826             $9,558,595            $3,524,826
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305      $2,466,442       $255,086        $176,241        $176,241        $176,241            $176,241              $176,241               $477,930              $176,241
 Project Management                                    4% of development cost       $6,285,044       $373,153        $204,069        $140,993        $140,993        $140,993            $140,993              $140,993               $382,344              $140,993
 Contingency                                          20% of development cost      $31,425,219      $1,865,767      $1,020,344       $704,965         $704,965        $704,965            $704,965              $704,965             $1,911,719              $704,965
   Subtotal                                                                        $47,566,567      $4,705,362      $1,479,499      $1,022,200      $1,022,200      $1,022,200          $1,022,200            $1,022,200             $2,771,993            $1,022,200
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817              $0     $25,480,000      $4,560,150              $0      $51,620,656       $18,829,730            $33,088,424             $2,989,718          $23,077,713
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)             $0     ($5,096,000)      ($912,030)             $0     ($10,324,131)      ($3,765,946)           ($6,617,685)             ($597,944)         ($4,615,543)
  Subtotal                                                                       $284,048,654              $0     $20,384,000      $3,648,120              $0      $41,296,525       $15,063,784            $26,470,739             $2,391,775          $18,462,171
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000            $0               $0              $0              $0               $0                     $0                    $0           $200,000               $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000             $0       $2,900,000      $2,900,000      $2,900,000      $2,900,000          $2,900,000            $2,900,000             $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313     $14,034,198     $29,865,221     $11,095,146      $7,447,026     $48,743,550        $22,510,809            $33,917,765           $17,822,362           $26,109,196
  Total Expenditures (inflated)                       3.0% /yr                   $882,403,634      $14,034,198     $30,761,178     $11,770,840      $8,137,566     $54,861,295        $26,096,198            $40,499,585           $21,919,257           $33,074,349
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024              $0              $0              $0      $3,014,828      $6,583,664          $4,940,969            $6,538,570             $6,409,731            $6,474,151
IFD Pay As You Go (inflated)                                                       $23,093,720              $0              $0         $60,840       $193,700        $293,410             $425,360              $554,710               $685,360              $811,720
  Total IFD Proceeds (inflated)                                                   $160,841,744              $0              $0         $60,840      $3,208,528      $6,877,074          $5,366,329            $7,093,280             $7,095,091            $7,285,871
NET REVENUE BEFORE PROP D                                                         $919,789,532     ($4,034,198)   ($27,446,053)    ($5,952,527)     $1,672,172    ($40,608,271)     ($10,960,271) ($21,631,532)    ($1,205,553) ($10,937,463)
CUMULATIVE                                                                                         ($4,034,198)   ($31,480,251)   ($37,432,779)   ($35,760,606)   ($76,368,877)     ($87,329,149) ($108,960,681) ($110,166,234) ($121,103,697)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844              $0              $0              $0              $0               $0       $48,673,844                         $0                    $0                     $0
Public Financing Available Now
Grants                                                                                       $0             $0              $0              $0              $0              $0                  $0                    $0                     $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765             $0              $0              $0      $1,754,897      $6,434,220          $4,893,108            $5,132,850             $5,381,643            $5,639,796
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)             $0              $0              $0      ($121,250)      ($565,806)          ($903,883)          ($1,258,524)           ($1,630,355)          ($2,020,022)
   Total Public Financing (inflated)                                              ($41,629,300)             $0              $0              $0      $1,633,647      $5,868,414          $3,989,225            $3,874,326             $3,751,288            $3,619,774
NET REVENUE AFTER PROP D AND CFD [11]                                             $926,834,076     ($4,034,198)   ($27,446,053)    ($5,952,527)     $3,305,819    ($34,739,857)      $41,702,797           ($17,757,206)           $2,545,735           ($7,317,689)
CUMULATIVE                                                                                         ($4,034,198)   ($31,480,251)   ($37,432,779)   ($34,126,959)   ($68,866,816)     ($27,164,019)          ($44,921,225)         ($42,375,490)         ($49,693,179)




                                                                                                                                                                       P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen7.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                          Page 1 of 5
Table B14 - Sensitivity 7                                                                                                                                                                                                         Sensitivity 7 - Spread Costs
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                               Year
Item                                                                 Factor     Total (Yrs 0-30)         9              10              11              12             13                   14                    15                    16                    17

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239        $5,553,056      $5,664,159      $6,545,533      $6,569,322    $10,543,283        $10,734,533           $12,116,894            $12,116,894           $12,116,894
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830        $7,056,290      $7,858,684      $8,661,079      $9,463,473    $10,265,868        $11,068,262           $11,870,656            $12,673,051           $13,475,445
Interim Leasing Income (2009$) [3]                                                 $15,950,000         $580,000        $290,000               $0              $0             $0                 $0                    $0                     $0                    $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
  Total Revenues (2009$)                                                         $835,973,069        $13,189,346     $13,812,844     $15,206,612     $16,032,795    $20,809,151        $21,802,795           $23,987,550            $24,789,945           $25,592,339
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422       $17,209,104     $18,563,307     $21,049,508     $22,858,933    $30,558,939        $32,978,684           $37,371,822            $39,780,584           $42,300,237

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725         $233,003        $233,003        $540,104        $233,003       $233,003            $540,104             $233,003                          $0                 $0
 Infrastructure [4]                                                                $46,000,000        $2,482,358      $2,482,358      $5,754,142      $2,482,358     $2,482,358          $5,754,142           $2,482,358                         $0                 $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0              $0              $0      $7,977,902             $0                  $0           $7,977,902                         $0         $7,977,902
   Subtotal                                                                        $74,251,430        $2,715,361      $2,715,361      $6,294,246     $10,693,263     $2,715,361          $6,294,246          $10,693,263                         $0         $7,977,902
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000          $809,465       $809,465       $1,876,351        $809,465      $809,465           $1,876,351             $809,465                     $0                     $0
Park Space and Open Space                                                          $22,874,663                $0       $926,374               $0              $0     $5,275,624                  $0            $2,886,956                    $0                     $0
Piers/Wharfs                                                                       $45,000,000                $0              $0      $4,500,000              $0     $4,500,000          $4,500,000            $4,500,000            $4,500,000             $4,500,000
  Subtotal                                                                         $82,874,663          $809,465      $1,735,839      $6,376,351        $809,465    $10,585,089          $6,376,351            $8,196,421            $4,500,000             $4,500,000
Total Development Cost (2009$)                                                    $157,126,093        $3,524,826      $4,451,201     $12,670,597     $11,502,728    $13,300,450        $12,670,597           $18,889,684             $4,500,000           $12,477,902
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $176,241        $222,560        $633,530        $575,136       $665,023            $633,530              $944,484              $225,000               $623,895
 Project Management                                    4% of development cost       $6,285,044         $140,993        $178,048        $506,824        $460,109       $532,018            $506,824              $755,587              $180,000               $499,116
 Contingency                                          20% of development cost      $31,425,219         $704,965        $890,240       $2,534,119      $2,300,546     $2,660,090          $2,534,119            $3,777,937              $900,000             $2,495,580
   Subtotal                                                                        $47,566,567        $1,022,200      $1,290,848      $3,674,473      $3,335,791     $3,857,131          $3,674,473            $5,478,008            $1,305,000             $3,618,591
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817         $6,101,898    $33,142,366      $2,629,001      $94,204,246     $2,231,499       $33,001,860                         $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)       ($1,220,380)   ($6,628,473)      ($525,800)    ($18,840,849)     ($446,300)      ($6,600,372)                        $0                    $0                    $0
  Subtotal                                                                       $284,048,654         $4,881,518    $26,513,893      $2,103,201      $75,363,397     $1,785,199       $26,401,488                         $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000        $200,000        $200,000        $200,000       $200,000            $200,000              $200,000               $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000      $2,900,000      $2,900,000      $2,900,000     $2,900,000          $2,900,000            $2,900,000            $2,900,000             $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $12,528,544     $35,355,942     $21,548,270     $93,301,916     $22,042,780       $45,846,558           $27,467,692             $8,905,000           $19,196,493
  Total Expenditures (inflated)                       3.0% /yr                   $882,403,634        $16,346,908     $47,515,429     $29,827,846    $133,026,222    $32,370,566       $69,347,032           $42,793,769            $14,289,911           $31,728,878
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024        $6,261,567      $7,382,464      $6,751,154      $7,221,416     $7,272,951        $12,587,553            $8,142,613            $10,210,476            $8,767,482
IFD Pay As You Go (inflated)                                                       $23,093,720         $960,700       $1,096,940      $1,242,670      $1,389,440     $1,643,460         $1,807,780            $2,013,830             $2,190,760            $2,375,360
  Total IFD Proceeds (inflated)                                                   $160,841,744        $7,222,267      $8,479,404      $7,993,824      $8,610,856     $8,916,411        $14,395,333           $10,156,443            $12,401,236           $11,142,842
NET REVENUE BEFORE PROP D                                                         $919,789,532        $8,084,463 ($20,472,718)       ($784,514) ($101,556,434)    $7,104,785 ($21,973,016)      $4,734,496    $37,891,910    $21,714,201
CUMULATIVE                                                                                         ($113,019,234) ($133,491,952) ($134,276,466) ($235,832,900) ($228,728,115) ($250,701,131) ($245,966,635) ($208,074,726) ($186,360,525)

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0              $0              $0              $0              $0                    $0                     $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0              $0              $0              $0             $0                 $0                    $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $5,907,628      $6,185,467      $6,473,654      $6,772,539     $7,082,484         $7,403,863            $7,737,061            $8,082,477            $8,440,521
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($2,428,194)    ($2,855,563)    ($3,302,843)    ($3,770,775)   ($4,260,121)       ($4,771,672)          ($5,306,244)          ($5,864,682)          ($6,447,858)
   Total Public Financing (inflated)                                              ($41,629,300)        $3,479,434      $3,329,904      $3,170,811      $3,001,764     $2,822,363         $2,632,191            $2,430,817            $2,217,795            $1,992,663
NET REVENUE AFTER PROP D AND CFD [11]                                             $926,834,076       $11,563,897    ($17,142,814)     $2,386,297 ($98,554,669)      $9,927,148 ($19,340,825)      $7,165,313    $40,109,704                              $23,706,864
CUMULATIVE                                                                                          ($38,129,282)   ($55,272,096)   ($52,885,800) ($151,440,469) ($141,513,321) ($160,854,146) ($153,688,833) ($113,579,128)                            ($89,872,265)




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen7.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 2 of 5
Table B14 - Sensitivity 7                                                                                                                                                                                                          Sensitivity 7 - Spread Costs
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007
                                                                                                                                                                                                                                 Year
Item                                                                 Factor     Total (Yrs 0-30)        18               19             20             21              22                     23                   24                    25                    26

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239       $12,116,894      $12,485,480    $12,485,480    $12,485,480     $12,485,480          $12,485,480          $12,485,480           $12,485,480            $12,485,480
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830       $14,277,839      $14,277,839    $14,277,839    $14,277,839     $14,277,839          $14,277,839          $14,277,839           $14,277,839            $14,277,839
Interim Leasing Income (2009$) [3]                                                 $15,950,000                $0               $0             $0             $0              $0                   $0                   $0                    $0                     $0
Proposition A Park Bond (2009$)                                                    $10,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
  Total Revenues (2009$)                                                         $835,973,069        $26,394,733      $26,763,319    $26,763,319    $26,763,319     $26,763,319          $26,763,319          $26,763,319           $26,763,319            $26,763,319
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422       $44,935,267      $46,929,643    $48,337,532    $49,787,658     $51,281,288          $52,819,726          $54,404,318           $56,036,447            $57,717,541

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
 Infrastructure [4]                                                                $46,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $74,251,430                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Park Space and Open Space                                                          $22,874,663                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Piers/Wharfs                                                                       $45,000,000        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                         $82,874,663        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Total Development Cost (2009$)                                                    $157,126,093        $4,500,000       $4,500,000     $9,000,000             $0                 $0                    $0                    $0                    $0                    $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305         $225,000         $225,000       $450,000              $0                 $0                    $0                    $0                    $0                    $0
 Project Management                                    4% of development cost       $6,285,044         $180,000         $180,000       $360,000              $0                 $0                    $0                    $0                    $0                    $0
 Contingency                                          20% of development cost      $31,425,219         $900,000         $900,000      $1,800,000             $0                 $0                    $0                    $0                    $0                    $0
   Subtotal                                                                        $47,566,567        $1,305,000       $1,305,000     $2,610,000             $0                 $0                    $0                    $0                    $0                    $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817       $24,103,556               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)      ($4,820,711)              $0             $0             $0                 $0                    $0                    $0                    $0                    $0
  Subtotal                                                                       $284,048,654       $19,282,845               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000         $200,000         $200,000       $200,000       $200,000        $200,000              $200,000              $200,000              $200,000              $200,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000        $2,900,000       $2,900,000     $2,900,000     $2,900,000      $2,900,000            $2,900,000           $2,900,000            $2,900,000            $2,900,000
  Total Expenditures (2009$)                                                      $608,441,313       $28,187,845       $8,905,000     $14,710,000     $3,100,000     $3,100,000            $3,100,000           $3,100,000            $3,100,000            $3,100,000
  Total Expenditures (inflated)                       3.0% /yr                   $882,403,634       $47,987,919      $15,614,971     $26,567,896     $5,766,913     $5,939,921            $6,118,118           $6,301,662            $6,490,712            $6,685,433
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024        $9,147,556       $9,540,515    $10,500,364             $0                 $0                    $0                    $0                    $0                    $0
IFD Pay As You Go (inflated)                                                       $23,093,720        $2,567,890       $2,779,790             $0             $0                 $0                    $0                    $0                    $0                    $0
  Total IFD Proceeds (inflated)                                                   $160,841,744       $11,715,446      $12,320,305    $10,500,364             $0                 $0                    $0                    $0                    $0                    $0
NET REVENUE BEFORE PROP D                                                         $919,789,532        $8,662,794      $43,634,976    $32,269,999   $44,020,745      $45,341,367         $46,701,608          $48,102,656           $49,545,736           $51,032,108
CUMULATIVE                                                                                         ($177,697,731)   ($134,062,755) ($101,792,755) ($57,772,011)    ($12,430,644)        $34,270,964          $82,373,620          $131,919,356          $182,951,464

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844                $0               $0             $0             $0                 $0                    $0                    $0                    $0                    $0
Public Financing Available Now
Grants                                                                                       $0                $0               $0             $0             $0              $0                   $0                   $0                    $0                    $0
Mello-Roos CFD (inflated)                                                          $120,924,765        $8,811,618       $9,196,206     $9,594,736             $0              $0                   $0                   $0                    $0                    $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)      ($7,056,674)     ($7,692,062)   ($8,354,986)   ($8,354,986)    ($8,354,986)         ($8,354,986)         ($8,354,986)          ($8,354,986)          ($8,354,986)
   Total Public Financing (inflated)                                              ($41,629,300)        $1,754,944       $1,504,143     $1,239,750   ($8,354,986)    ($8,354,986)         ($8,354,986)         ($8,354,986)          ($8,354,986)          ($8,354,986)
NET REVENUE AFTER PROP D AND CFD [11]                                             $926,834,076       $10,417,738      $45,139,119    $33,509,749    $35,665,759    $36,986,381         $38,346,622 $39,747,670                     $41,190,750           $42,677,122
CUMULATIVE                                                                                          ($79,454,526)    ($34,315,407)     ($805,658)   $34,860,101    $71,846,482        $110,193,104 $149,940,774                   $191,131,525          $233,808,647




                                                                                                                                                                            P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen7.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                               Page 3 of 5
Table B14 - Sensitivity 7                                                                                                             Sensitivity 7 - Spread Costs
Development Cash Flow
Pier 70 Financial Feasibility Analysis; EPS #17007

Item                                                                 Factor     Total (Yrs 0-30)       27              28             29                30

REVENUES
Rehabilitated Building Lease plus reversion value (2009$) [1]                     $376,272,239      $12,485,480     $12,485,480     $12,485,480      $124,854,801
New Construction Ground Lease plus reversion value (2009$) [2]                    $433,750,830      $14,277,839     $14,277,839     $14,277,839      $142,778,393
Interim Leasing Income (2009$) [3]                                                 $15,950,000               $0              $0              $0                $0
Proposition A Park Bond (2009$)                                                    $10,000,000               $0              $0              $0                $0
  Total Revenues (2009$)                                                         $835,973,069       $26,763,319     $26,763,319     $26,763,319      $267,633,194
  Total Revenues (inflated)                           3.0% /yr                  $1,641,351,422      $59,449,067     $61,232,539     $63,069,515      $649,616,008

EXPENDITURES
Sitework Costs (2009$)
 Demolition                                                                         $4,317,725               $0              $0              $0                $0
 Infrastructure [4]                                                                $46,000,000               $0              $0              $0                $0
 Structured Parking [5]                               1,733 spaces                 $23,933,705               $0              $0              $0                $0
   Subtotal                                                                        $74,251,430               $0              $0              $0                $0
Waterfront Improvements (2009$)
Remediation                                                                        $15,000,000               $0              $0              $0                $0
Park Space and Open Space                                                          $22,874,663               $0              $0              $0                $0
Piers/Wharfs                                                                       $45,000,000               $0              $0              $0                $0
  Subtotal                                                                         $82,874,663               $0              $0              $0                $0
Total Development Cost (2009$)                                                    $157,126,093               $0              $0              $0                $0
Soft Costs (constant 2009$)
 Planning & Entitlement [6]                            5% of development cost       $9,856,305               $0              $0              $0                $0
 Project Management                                    4% of development cost       $6,285,044               $0              $0              $0                $0
 Contingency                                          20% of development cost      $31,425,219               $0              $0              $0                $0
   Subtotal                                                                        $47,566,567               $0              $0              $0                $0
Rehabilitated Building Feasibility Gap
Rehabilitation [7]                                                               $355,060,817               $0              $0               $0                $0
(Less) Historic Tax Credits                           20% of rehab cost          ($71,012,163)              $0              $0               $0                $0
  Subtotal                                                                       $284,048,654               $0              $0               $0                $0
Ongoing Remediation Monitoring (2009$) [1]                                           $6,600,000        $200,000        $200,000        $200,000        $2,000,000
Base Rent To The Port (2009$) [1]                                                 $113,100,000       $2,900,000      $2,900,000      $2,900,000       $29,000,000
  Total Expenditures (2009$)                                                      $608,441,313        $3,100,000      $3,100,000      $3,100,000      $31,000,000
  Total Expenditures (inflated)                       3.0% /yr                   $882,403,634        $6,885,996      $7,092,576      $7,305,353      $75,245,137
Required Public Financing (inflated)
IFD Bond (65% of T.I.) (inflated) [8]                                             $137,748,024               $0              $0              $0                $0
IFD Pay As You Go (inflated)                                                       $23,093,720               $0              $0              $0                $0
  Total IFD Proceeds (inflated)                                                   $160,841,744               $0              $0              $0                $0
NET REVENUE BEFORE PROP D                                                         $919,789,532      $52,563,071     $54,139,963     $55,764,162     $574,370,871
CUMULATIVE                                                                                         $235,514,535    $289,654,499    $345,418,661     $919,789,532

PROP D
Bond Proceeds (inflated) [9]                                                       $48,673,844               $0              $0              $0                $0
Public Financing Available Now
Grants                                                                                       $0               $0              $0              $0                $0
Mello-Roos CFD (inflated)                                                          $120,924,765               $0              $0              $0                $0
(Less) CFD Value Reduction @ 75% [10]                                            ($162,554,065)     ($8,354,986)    ($8,233,736)    ($7,789,180)     ($19,434,738)
   Total Public Financing (inflated)                                              ($41,629,300)     ($8,354,986)    ($8,233,736)    ($7,789,180)     ($19,434,738)
NET REVENUE AFTER PROP D AND CFD [11]                                             $926,834,076      $44,208,085     $45,906,228     $47,974,982     $554,936,133
CUMULATIVE                                                                                         $278,016,732    $323,922,960    $371,897,942     $926,834,076




                                                                                                                                                                     P:\17000s\17007Pier70\Model\Sensitivities\FINAL_SensitivitiesJan2010\17007feas 29Oct09_Sen7.xls
        Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                        Page 4 of 5
 Notes:
[1] Capitalized at 10%.
[2] Assumes 8.5% of residual land value; capitalized at 10%.
[3] Reflects the revenues generated by existing uses that are assumed to be demolished and redeveloped during a 10-year period.
[4] Assumed to be phased as follows: 2/3 of the total cost during the first 5 years and the remaining 1/3 of the total cost during years 6 through 10.
[5] Vertical pro formas include 0.5 spaces per 1,000 square feet of new development. Structured parking includes 0.5 spaces per
    1,000 square feet of new development, plus 1.0 spaces per 1,000 square feet of existing building development. Total spaces included in project:
[6] Includes additional $2.0 million in year 0 to reflect the up-front planning costs prior to breaking ground.
[7] Include 25% Hazmat abatement, 20% construction contingency and 30% in soft costs; assumes an additional annual escalation cost of 1 percent because of deterioration.
[8] Infrastructure Financing District.
[9] Reflects a bond based on 75% of payroll and TOT revenues over a 20-year period.
[10] Capitalized at 10% based on the average annual payment of about $2.0 million that reflects the reduction in the CFD discount associated with the payment decrease.
[11] It is important to note that the prior table's totals show a slightly different grouping of revenues and costs. In the prior table, IFD revenues are included in the initial "revenues" section
  while in this more detailed table it is included as part of public financing. In addition, on the prior table, historic costs, revenues, and tax credits are combined to illustrates the historic
  feasibility gap while on this table they are split among the revenues and expenditures sections.
Formatting indicates year in which the highest, cumulative project deficit is expected.

Source: Economic & Planning Systems, Inc.




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         Economic & Planning Systems, Inc. 1/11/2010                                                                                                                                                                                                                               Page 5 of 5