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CQ'\I'IT)EN'I'IAL. & I'Ra~'IL.L;GT~I) Regency Centers -Pleasanton <br />~tiORTi P.RQI)tiCT Evaluation of PRC Site & Sales Analysis <br />October 8, 2007 <br />Page 2 of 10 <br />METHODOLOGY <br />Trade Area Definition <br />Kosmont delineated a trade area encompassing three cities (Pleasanton, Dublin <br />and Livermore) and a portion of unincorporated Alameda County (see Appendix <br />B). This trade area was selected based on the nature and pattern of population <br />densities in this area which encompass natural boundaries and travel patterns. <br />Actual household income and spending data for the trade area was acquired <br />through Claritas, Inc. (a respected private subscriber-based demographics <br />information service) and incorporated into Kosmont's review as appropriate. <br />Sales Leakage <br />Sales leakage is that portion of resident sales demand in a particular geographic <br />area which is not captured by the existing base of retail or service providers in the <br />area. Kosmont calculated leakage in Pleasanton for all hardware and building <br />materials sales in 2006. By utilizing reported data from the California State Board <br />of Equalization and Claritas Inc., Consultant estimated total demand for building <br />materials and hardware building in Pleasanton and then subtracted the actual 2006 <br />sales in the same retail category. The result is the amount of sales leakage from <br />Pleasanton. <br />KEY ASSUMPTIONS AND FINDINGS -PRC <br />Sales Forecast <br />• 2009 total annual sales for the new Home Depot are estimated at $27.951 million. <br />• 2011 total annual sales for the new Home Depot are estimated at $33.916 million. <br />Trade Area <br />• Defined as "the entire City of Pleasanton, a portion of Livermore and Sunol." <br />Sales Leakage <br />• $74.67 million (calculated outside of report through methodology proprietary to <br />PRC). <br />Net New Sales <br />• Approximately $20 million in net new sales which discounts approximately <br />$7.951 million in overlapping sales from the existing Johnson Drive store. <br />• $20 million in net new sales is adequate for Home Depot to proceed with opening <br />a new store in Pleasanton and is a good opportunity to strengthen its market share <br />in this area of Alameda County. <br />7t+n arwiyWa ~s +a eWavatve O++N~c antl is rwt a ywrenroe of aaw~ a~drw fNUre rewna. PmJe~ qro tnrma arq [a enwyses aro <br />- prajectiorx ony tctum reawta may attar metar~aNy kom awaa axgasae~ r um ane+yaia. <br />kosmo, n~,,,„ ,asotvermasewc. s~nas+i Encino cumwmn s~aas ona+e.se~.aaa ia~919.99+.b588 w+.w.koamont,i:an <br />