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CO <br />FINANCIAL STRESS OF A PROPERTY <br />ECS has provided two methods for determining the financial stress of Orange County owned <br />and maintained properties. For properties with similar facilities available for rent in the real <br />estate market, a table outlining the full service "in house" costs for Orange County vs. the full <br />service market rental rates is included in Appendix 3. For properties without similar facilities <br />available for rent in the real estate market, ECS used RS Means to estimate a <br />replacement value (where available) to compare to the summation of pro -rated 10 -year capital <br />costs ( "3 multiplier" — 30 year financing as opposed to 10 year financing — for each property, as <br />future capital costs are difficult to quantify past 10 years but need to be accounted for) and 30 year <br />straight line depreciation. <br />Full- service lease terms include building costs, property taxes, utilities, cleaning services, and <br />maintenance. As a government entity, Orange County does not pay property taxes. Therefore <br />the table presents the cost per square foot for the Orange County space, calculated using an <br />estimated tax value, provided by the Orange County Tax Assessor, based upon data and model <br />assumptions. ECS was not able to determine the assessed value of the properties, and so <br />used the current day RS Means rebuild costs as an estimate of value. In addition to <br />replacement costs, ECS utilized RS Means and inflation indexes to estimate original construction <br />costs to provide for depreciated costs. For simplicity ECS utilized a 30 year straight line <br />depreciation table. These costs are summarized in the attached table. <br />To assist in calculating the change in cost for additional off -site storage, ECS has been asked to <br />provide a range in costs for climate controlled storage. Climate controlled storage (not cold <br />storage) can be rented for between $7.00 and $9.00 per square foot. With efficient racking, <br />inventory tracking and access, warehouse space can serve as 2 -5 times the square feet of <br />space. <br />