fair value appraisal of: tivoli village at queensridge

133 Pages·2016·4.6 MB·English

FAIR VALUE APPRAISAL OF:
TIVOLI VILLAGE AT QUEENSRIDGE
NEC Rampart Blvd & Alta Drive
Las Vegas, Nevada

EFFECTIVE APPRAISAL DATE:
June 30, 2016

Marquette Advisors File #16028

PREPARED FOR:

Mr. Matthew Bunin
GREAT WASH PARK LLC
9525 Hillwood Drive, Suite 100
Las Vegas, NV 89134

PREPARED BY:

Marquette Advisors Offices:

Minneapolis Office: 50 South Sixth Street, Suite 1370, Minneapolis, MN 55402
Phone: [phone]; Fax: [phone]
Seattle Office: 2723 California Avenue SW, Seattle, WA 98116
Phone: [phone]; Fax: [phone]
Washington DC Office: 1140 Connecticut Avenue NW, Washington, DC 20036
Phone: [phone]; Fax: [phone]
TABLE OF CONTENTS

Identification of the Subject Property ............................................................................. 1
Planned Development Program & Construction Status ................................................... 7
Development Budget .................................................................................................... 13
Summary of Salient Facts & Conclusions ..................................................................... 14
Intended User & Use of the Appraisal .......................................................................... 15
Property Rights Appraised & Date of Value ................................................................. 15
Scope of Work ............................................................................................................. 15
Underlying Assumptions .............................................................................................. 16
Extraordinary Assumptions .......................................................................................... 17
Limiting Conditions ..................................................................................................... 17
Competency Provision ................................................................................................. 18
Fair Value Definition ................................................................................................... 21
Regional Characteristics ............................................................................................... 22
Tivoli Village Primary Trade Area Analysis ................................................................. 35
Neighborhood Analysis ................................................................................................ 40
Site Analysis ................................................................................................................ 44
Zoning & Related Entitlements .................................................................................... 46
Highest and Best Use ................................................................................................... 56
Competitive Market Analysis ....................................................................................... 60
Financial Projections .................................................................................................... 75
Valuation ..................................................................................................................... 84
Final Reconciliation of Value ....................................................................................... 91
Certificate of Appraiser ................................................................................................ 92

Addenda

Engagement Letter
Rent Roll
PWC Investor Survey (relevant sections)
August 25, 2016

Mr. Matthew Bunin
Great Wash Park LLC
9525 Hillwood Drive, Suite 100
Las Vegas, NV 89134

SUBJECT: Fair Value Appraisal � Tivoli Village at Queensridge, as of June 30, 2016
Marquette Advisors File # 16028

Dear Mr. Bunin:

In accordance with your request, we have inspected and appraised the subject property referenced above. Mr.
Louis W. Frillman, FRICS, MAI, CRE is a licensed appraiser in the State of Minnesota (License Number
AP-4000728) and has obtained a temporary practice permit for this assignment through the State of Nevada.
That permit number is as follows: ATMP.0013144.CG.

We note that Marquette Advisors provided prior appraisals of the subject property. This appraisal reflects
an update to prior analyses and valuations by Marquette Advisors. The value assessed by Marquette
Advisors as of December 31, 2008 was $200,000,000. Subsequent appraisals by Marquette Advisors
reached a valuation conclusion of $201,000,000 as of December 31, 2009, $242,000,000 as of December
31, 2010, $281,000,000 as of September 30, 2011, a value range of $270,000,000 to $300,000,000 as of
September 30, 2012, a value of $260,000,000 as of March 31, 2013, a range of $265,000,000 to
$270,000,000 as of December 31, 2013, $278,000,000 as of September 30, 2014, and $281,000,000 as of
September 30, 2015.

It is noted that the IFRS Book Value is currently $305,900,000. The appraiser’s opinion of fair value as
of June 30, 2016, at $295,000,000 as reported herein, reflects the appraiser’s review of the subject
property in terms of construction status and leasing activity, as well as all relevant and available market
information for 2015 and 2016 year-to-date. The fact that the appraiser’s opinion of fair value is lower
than the current book value relates in part to property lease-up and economic performance lagging
somewhat behind ongoing construction progress. Another factor is a delay in construction and opening of
the final development phase (Triad C), now projected to open in January 2018.

IDENTIFICATION OF THE SUBJECT PROPERTY - The subject property is located at the northeast
corner of the intersection of Rampart Boulevard and Alta Drive in Las Vegas, Nevada. The entire
development site contains 28.62 total acres and is owned by Great Wash Park LLC. A major mixed use
development is underway at the site, incorporating more than 868,000 square feet (sf) of commercial space to
be leased to multiple retail, restaurant, and office tenants. Additionally, the property owners have an
entitlement for 300 multifamily residential units in a future phase. The project developer, Great Wash Park
LLC, intends to sell this portion of the property to a residential developer/builder in the future, as so entitled.
Aerial maps are provided on the following pages, depicting the property’s regional and neighborhood
location. The aerials are followed by a site survey.
Marquette Advisors Offices:
Minneapolis Office: 50 South Sixth Street, Suite 1370, Minneapolis, MN 55402
Phone: [phone]; Fax: [phone]
Seattle Office: 2723 California Avenue SW, Seattle, WA 98116
Phone: [phone]; Fax: [phone]
Washington DC Office: 1140 Connecticut Avenue NW, Washington, DC 20036
Phone: [phone]; Fax: [phone]
Tivoli Village at Queensridge, Las Vegas, NV
Tivoli Village at Queensridge, Las Vegas, NV
Tivoli Village at Queensridge, Las Vegas, NV

Tivoli Village at Queensridge
Las Vegas, Nevada Fair Value Appraisal

DEVELPOMENT PROGRAM & CONSTRUCTION STATUS

The Tivoli Village at Queensridge design evokes a classic European theme, with extensive
stonework and intricate architectural details. Located at the eastern periphery of Summerlin and
some of Las Vegas’ most affluent neighborhoods, the project features an eclectic mix of high-end
retail shops, boutiques and restaurants, along with Class A office space. Future phases will include
multifamily residential development. The planned development program and phasing schedule is
summarized as follows:

• 413,889 sf of retail & restaurant space for lease, developed in four phases:

o Triad A: 202,572 sf -- opened April 2011
o Triad B: 155,173 sf -- projected to open October 2016
o Triad C Bldg. 4: 26,144 sf -- projected to open January 2018
o Triad C Bldg. 12: 30,000 sf – projected to open January 2018

• 454,118 sf of office space for lease, developed in four phases:

o Triad A: 162,545 sf – opened April 2011
o Triad B: 149,113 sf -- projected to open October 2016
o Triad C Bldg. 4: 42,460 sf -- projected to open January 2018
o Triad C Bldg. 12: 100,000 sf – projected to open January 2018

• Phase II residential land as entitled for 300 residential units. The project sponsor plans to
sell this land as-entitled to a residential builder/developer in two pieces in 2018 and 2019.

• Total Budget: $604.6 Million (excluding developer fees, financing and land acquisition
costs), with approximately $107.9 million remaining to complete (including projected tenant
improvement costs for remaining space components)

The graphics on the following pages include site and building plans for Tivoli Village at
Queensridge. This is followed by the project budget, as provided by Great Wash Park LLC.

Marquette Advisors Page 7
Site Plan

Future
Residential
/Mixed-
Use
Triad C Triad B Triad A