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User Market <br /> The User market in Concord primarily consists of 1,000 to 2,000 SF users. There is also <br /> substantial demand from the smaller users who typically lease by the office; this might be <br /> called the "keyman" or"executive office suite" concept. Rare is the 5,000+ SF user in <br /> this market. Moreover, the floor-plan configuration of this office building is inconsistent <br /> with what the market is demanding. Typically there is more open space for cubicles and <br /> fewer private offices. The likely user demand will come from the medical industry, <br /> professional industry(CPA, operations, marketing, etc). <br /> Investor Market <br /> The Investor market is closely related to the capital markets, interest rates, Treasury <br /> Bonds and the overall investment environment. Real estate in general is a good place to <br /> invest money at this time, as it is a tangible asset that theoretically generates steady cash- <br /> flow. Investments with cash flow (or yield) are trading at a premium in this market. <br /> Investors analyze their Opportunity Cost of Capital and determine where they can place <br /> their money to get the highest return for the lowest risk. For purposes of analyzing the <br /> Subject Property, we believe this asset will be attractive to the investor of Class-B <br /> properties with local tenant credit quality. <br /> Therefore, the Subject Property is more likely to attract the local, Class-B investor. This <br /> investor will buy the property and lease it out as best he/she can. We think the market <br /> rent this investor may achieve will be in the $9 to $10/SF gross range and the tenants will <br /> be in the 1,000 to 2,000 SF range or smaller. This would come after capital investment <br /> by investor to update and re-hab the property to modern day standards. <br /> (Note: there are various types of lease structures. Yours is considered gross, which <br /> means that property related expenses are included in the rental rate (taxes, insurance, <br /> common area maintenance, etc). Please visit our website to learn more about rental rate <br /> structures: hqp://www.hanismorrison.com/Market/Keys-To-Commercial-Real-Estate) <br /> Attachment number 1 \n <br /> F-8 Page 97 <br />