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at $2,410,000 ($9.69 per sq.ft. of net usable land area). The Developer is obligated to construct high quality site amenities, including a prominent landscape feature at the corner of San Leandro Boulevard and Davis Street, extensive parking lot landscaping on the Site, and a creekwalk. ■ Indirect costs (exclusive of financing costs) are estimated at approximately $2.6 million, or $20 per square foot of rentable area, and include architecture and engineering, insurance, bonds, estimated fees and permits, DFSI/undergrounding fees, general administrative expenses, and leasing commissions. The financing cost estimates are based on $18.0 million in construction financing at 9.5% for 12 months, and financing fees of 2.0 points. The financing cost, including fees, is projected to be approximately $1.2 million. As can be seen in Table 1, direct costs are estimated at approximately $15,075,000 and indirect and financing costs at $3,810,000, for a total cost, excluding land costs and Developer profit, of $18,885,000. B. Net Income Table 2 presents the projected net operating income for the Minimum Project. The income assumptions used are based upon discussions of lease terms provided by the Developer. In addition, it is assumed that the layout and size of the tenancies must be in accordance with the proposed Conceptual Site Plan. The major assumptions behind the rental estimates are as follows: The Developer has represented that he is negotiating leases with two key office tenants at $27/sq.ft. per year ($2.25/sq.ft. per month); Estimated rental income of $27/sq.ft. per year (full service) for the remaining office tenants ($2.25 per sq.ft. per month); and Estimated rental income of $24/sq.ft. per year (triple net) for the 2,000 sq.ft. restaurant ($2.00 per sq.ft. per month). Keyser Marston Associates, Inc. 19096.001\002-002.doc Page 12