7a Supp Final

ITEM NO: 7a_Supp
DATE OF MEETING : April 6, 2010



Real Estate Division Inventory
Port of Seattle Commission
April 6, 2010

Assessment Protocol
Honor principles of the Century Agenda
Determine Income from Operations (IFO)/Net
Operating Income (NOI) for each property
Establish range of investment/investor criteria
Apply criteria to individual properties
Establish a range of estimated property values
Identify specific attributes that affect individual
properties
Describe obstacles that hinder individual
properties

Guiding PrinciplesCentury Agenda
Encourage manufacturing and industrial growth
Use of levy funds for community benefit and provide
infrastructure that advances trade and commerce
Advance land use that supports light industry, utilities,
freight hauling and public transportation
Assign priorities based upon a tiered system:
Tier 1Direct uses  (cargo and cruise terminals)
Tier 2Indirect uses (World Trade Center, ERC)
Tier 3Unrestricted uses       (Tsubota, CEM)

Valuation Principles
Rent assumptions:
Projections based on current rates increased by inflation
Building occupancies based on 2010 Budget average
occupancy
Expense assumptions:
Actual expenses where appropriate/2008 BOMA Experience
Exchange Report (most current available)
Future years increased by inflation
Cap rates:
7.5%-9.5% @ 25 basis point increments
Discount rates:
8.0%-10.0% @ 25 basis point increments

Valuation Principles
Land sites
Based on land values from other port owned sites for which
there was a recent appraisal
Inflation assumption: 2.5%/year over 10
years
Applied capital improvement expenditures
consistent with plan of finance
Assumes all sites environmentally clean
Yields a range of estimated values and are
indicative rather than conclusive

Portfolio Management
$'s in Thousands
PROPERTY          LOW VALUE         HIGH VALUE
Harbor Marina Corporate
Center                                 12,749                 17,172
Terminal 34                                2,401                   3,078
Pier 2                                         2,990                     5,554
Terminal 5 SE (Chelan
Caf/Mission to Seafarers)                         (62)                       (31)
World Trade Center West                  11,582                 15,181
Bell Street Garage                          16,658                   21,454
Central Waterfront                         25,593                  34,101
CEM                           9,110             9,110
Sub Total:                $81,021                 $105,619

Harbor Services

$'s in Thousands

PROPERTY         LOW VALUE        HIGH VALUE
Bell Harbor Marina value     Bell Harbor Marina value imbedded
Bell Harbor Marina          imbedded in totals        in Central Waterfront totals
Shilshole Bay Marina                   53,452                 71,261
Harbor Island Marina                    1,700                  1,700
Sub Total:                $55,152                 $72,961

Facilities Management and Real Estate Development

$'s in Thousands

PROPERTY         LOW VALUE       HIGH VALUE
Real Estate Development
Terminal 91 Uplands                    67,039                80,659
Tsubota Steel                            2,619                  4,863
Sub Total:             $69,658                $85,522

Facilities Management
Pier 69                                   15,500                 22,621
Sub Total:             $15,500                $22,621

Tier 1 Properties

$'s in Thousands

PROPERTY          LOW VALUE        HIGH VALUE
Bell St. Pier
(Central Waterfront Project)                                25,593                         34,101
Sub Total:                $25,593                 $34,101

Tier 2 Properties
$'s in Thousands

PROPERTY         LOW VALUE         HIGH VALUE
Harbor Marina
Corporate Center                       12,749                 17,172
Pier 2                                        2,990                    5,554
World Trade Ctr West                    11,582                 15,181
Bell Street Garage                        16,658                  21,454
Bell Harbor Marina value imbedded       Bell Harbor Marina value
Bell Harbor Marina               in totals           imbedded in Central Waterfront totals
Shilshole Bay Marina                     53,452                 71,261
Pier 69                                    15,500                  22,621
Sub Total:                $109,931                $153,243

Tier 3 Properties
$'s in Thousands

PROPERTY         LOW VALUE         HIGH VALUE
Terminal 34                              2,401                  3,078
Terminal 5 SE (Chelan
Caf/Mission to Seafarers)                        0    (62)                  925   (31)
Harbor Island Marina                     1,700                  1,700
Terminal 91 Uplands                    67,039                 80,659
Tsubota Steel                             2,619                  4,863
CEM                         9,110            9,110
Sub Total:                 $82,807                 $99,379

Total Values by Operating Group
$'s in Thousands
PROPERTY GROUP      LOW VALUE    HIGH VALUE

Portfolio Management                 $81,021        $105,619
Harbor Services (Rec Boating)          $55,152         $72,961
Real Estate Development              $69,658         $85,522
Pier 69 Facilities Management          $15,500          $22,621

Total:         $221,331         $286,723

Other Considerations
Shilshole legal limitations/State legislative authority
Bell Harbor Marina limitations/MUP/funding
Bell St. Pier (Central Waterfront Project) includes P-66 Cruise Terminal
Excludes sales/brokerage costs
Assumes environmentally clean
Results in loss of 7 public access points
Does not recognize allocations of $10.6MM ($8.6MM net) includes
Corporate ~ $5.9MM
Real Estate ~ $3.9MM
CDD/Seaport ~ $0.8MM

Preliminary Property
Recommendations
Pier 34                                      Market for Sale
T-5 SE                                      Market for Sale
(Chelan Caf/Mission to Seafarers)
Harbor Island Marina                    Market for Sale
Tsubota                                    Market for Lease
T-91 Uplands                              Market for Lease
CEM                                        Continue current lease
negotiations
Bell St. Pier (Central Waterfront Project)     Maintain
WTC West                                 Maintain
WTC Garage                              Maintain
Harbor Marina Corp Center            Maintain
Pier 2                                       Maintain
Shilshole Bay Marina                    Maintain
Pier 69                                      Maintain

T-5 SE and Easement
(Mission to Seafarers)

T-5 SE
(Chelan Caf)

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