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Land cost is $300,000 per acre ($15,000 per unit), and <br />assumes minimal on- and off-site infrastructure <br />improvement costs: <br /> <br />Construction cost is $65 per square foot of building <br />floor area; <br /> <br />Fee payment is $12,000 per unit; <br /> <br />Soft costs including financing and design are 15 percent <br />of total cost; and <br /> <br />Construction standards and deeignqualityare assum~ <br />be somewhat higher than for the existing units due tc <br />more restrictive state and local building regulations <br />that have.been enacted in recent years. <br /> <br />The estimated cost of producing new rental housing in Pleasanton in <br />1992 is $92,000 per unit. Assuming a five percent per year <br />inflation rate and replacement in 1997 (mid-point of the second <br />five year interval), the total replacement cost of the 278 assisted <br />units would be approximately $32,000,.000. <br /> <br />cost of Preserving Rxisting Assisted Rental Housing <br /> <br />Without the benefit of having appraisal estimates for Pleasanton <br />Greens, Stoneridge Apartments and Hacienda Gardens, exact <br />preservation costs are difficult to determine. Instead of <br />obtaining appraisals, a variety of other relevant factors were <br />analyzed in considering preservation costs: <br /> <br />In some cases, the units were designed and constructed to <br />somewhat lower standards and on less expensive land in 1975 <br />and 1988 than the buildings of today, and .as such, would be <br />of slightly lower value. <br /> <br />The original physical condition of these units will <br />deteriorate and the value should decrease with the passing of <br />time. However, it is important to recognize that all three <br />projects have been and continue to be very well maintained. <br /> <br />The units will be 10 to 21 years old .upon the restriction <br />termination dates and probably in need some rehabilitation in <br />order to .bring them up to the standard of comparable new <br />housing. <br /> <br />The magnitude of difference in preservation versus production cost <br />estimates is generally considered by professional real estate <br />developers in the area to be apprgximately 15 percent less <br />depending upon age, physical condition, and neighborhood land <br />values. Assuming a five percent per year inflation rate and <br />replacement in 1997 (mid-point of the second year interval), the <br /> <br />- 5 - <br /> <br /> <br />