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Project Progress Report June 23, 2015

New Moran, Inc

Executive Summary / Table of Contents

!
1)#Project#Description#!
What!is!the!Moran!Plant!going!to!be?!
!!
2)#Schematic#Design#Architectural#Plans!
The!Moran!Plant!team!is!working!through!a!4!phase!architectural!design!process;!!
!
1) Conceptual!Design!(Complete,!PIAP)#E!!pre$design*phase,*including*development*of*projects*program,*
goals*and*architectural*style.*This*phase*involves*extensive*community*input*and*public*review.**!
!
2) Schematic!Design!(75%!Complete)!E!where*concept*turns*to*architecture,*engaging*relevant*
engineering*disciplines*to*produce*building*plans,*elevations,*sections,*site*plans,*and*schematic*cost*
estimates.*The*end*of*this*phase*typically*marks*the*beginning*of*the*permitting*and*city*design*review*
process.*!
!
3) Design!Development!(anticipated!start!July/Aug!2016)!E!refinement*of*schematic*design*with*specific*
focus*on*developing*structural,*electrical,*and*mechanical*systems,*as*well*as*design*specifications*such*
as*construction*details,*building*materials,*acoustics...etc.!
!
4) Construction!Drawings!(anticipated!start!Dec!2016)!E!final*building*designs*translated*into*contract*
documents*for*construction*permit*application*and*subsequent*construction*start.!
!
Since!December!2015,!New!Moran!Inc!(NMI)!has!engaged!Smith!Buckley!Architects!on!a!Phase!1!of!Schematic!
Design!E!approximately!75%!of!a!traditional!schematic!design!process.!!
!
This!has!enable!us!to!create!brand!new!architectural!materials!depicting!our!vision!for!the!building,!as!well!as!
complete!the!next!round!of!cost!estimates!detailed!below.!The!floor!plans!and!architectural!renderings!
included!in!this!report!reflect!this!stage!of!design!and!are!subject!to!change!over!the!course!of!Design!
Development!and!Construction!Drawings.!
!
Narrative included below, development and operating budgets are proprietary.
3)#Project#Budgets! Professional cost estimates are discussed and included below.
The!project!budgets!attached!represent!more!than!18!months!of!diligence.!They!cover!the!development!
budget!(items!1.0E1.3)!and!the!operating!budget!(items!2.0E2.2)!for!a!CityEowned,!nonEprofit!managed!and!
financially!selfEsustaining!cultural!landmark.!When!complete,!the!Moran!Plant!will!operate!as!a!year!round!
public!amenity!and!economic!driver!on!the!Burlington!waterfront.!!
!!
As!in!prior!iterations!of!our!financial!model,!the!development!budget!relies!on!multiple!sources!of!finance.!
These!include!Tax!Increment!Financing!(TIF),!New!Market!Tax!Credits!(NMTC),!Rehabilitation!Investment!Tax!
Credits!(RITC),!tenant!fitEup!capital,!low!interest!debt,!and!contributions!from!a!charitable!capital!campaign.!
Capital!sources!have!been!structured!to!avoid!any!future!fundraising!or!significant!debt!service.!!
!
Unlike!prior!iterations!of!our!financial!model,!the!current!operating!budget!is!based!on!three!master!subEleases!
to!three!credit!worthy!tenants.!These!three!tenants!comprise!the!Market!Hall,!the!Turbine!Hall!and!the!
Innovation!Space!and!generate!the!revenue!which!enables!Moran!to!be!financially!selfEsustaining.!A!Letter!of!
Intent!has!been!signed!by!a!local!tenant!to!operate!Turbine!Hall.!Several!tenants!have!been!identified!for!the!
Market!Hall!and!Innovation!Space;!conversations!are!underway.!
!

Two!financial!scenarios!are!attached.!The!first!is!a!conservative!baseline!model.!The!second!is!a!stressed!model!
illustrating!one!possible!outcome!under!a!confluence!of!multiple!worst!case!outcomes.!This!second!model!is!
by!no!means!exhaustive,!but!it!does!address!a!number!of!potential!stressors.!!
!
On!the!capital!budget:!
!Reduced!yield!from!NMTC!allocation!
!Reduced!available!tenant!capital!
!Increased!loan!fees!
!Increased!financial!management!and!accounting!fees!
!
On!the!operating!budget:!
!Reduced!net!rent!per!square!foot!
!Increased!bridge!loan!term!for!charitable!pledges!
!Increased!debt!service!
!The!failure!of!one!tenant!and!corresponding!two!year!period!to!reElease!the!space!!!
!
Notes:!
NMI!has!structured!project!financing!so!that!it!does!not!rely!upon!financial!guarantees!or!credit!enhancement!
provided!by!the!City!of!Burlington.!
!
Under!New!Moran,!Inc.s!11/17/14!proposal,!City!of!Burlington!funds!($1,487,542)!spent!on!the!Moran!Center!
were!not!reimbursed.!In!the!current!development!budget!dated!6/22/2015,!these!funds!are!also!not!
reimbursed.!As!discussed,!this!is!consistent!with!the!Citys!May,!2014!request!to!reEconfigure!the!projected!
development!budget!in!order!to!meet!HUD!guidelines.!
!!
4)#Vermeulens#Cost#Estimate!
Vermeulens,!a!costEestimating!firm!previously!engaged!by!the!City!of!Burlington!on!the!Moran!Center!project,!
was!retained!to!complete!a!detailed!cost!estimates!based!on!this!schematic!design!phase!(and!moving!forward!
through!Design!Development!and!Construction!Drawings).!
!
Since!their!inception!in!1972!and!in!partnership!since!1961,!Vermeulens!has!been!a!leader!and!an!innovator!in!
their!specialty!of!preEconstruction!cost!control.!Vermeulens!developed!the!elemental!estimating!systems,!line!
item!estimate!computer!reports,!and!computer!graphic!take!off!processes!that!have!become!standard!
throughout!the!industry.!They!have!completed!major!projects,!at!and!above!this!scale,!in!Vermont!and!around!
the!world.!!
!
5)#Updated#Project#Schedule:####!!
Detailed!project!GANTT!chart,!specifically!outlining!NMIs!design!development!and!project!financing!timelines.!
See!below.!
!!
6)#Market#Study!
A!market!study!completed!by!New!Moran!Inc!(NMI)!to!analyze!the!local!commercial!real!estate!market,!
determine!the!feasibility!of!proposed!rental!rates,!and!review!projected!operating!expenses!against!existing!
comparable!real!estate.!
##
Note:!
We!have!engaged!Desman!Associates!(the!same!firm!responsible!for!the!City!of!Burlingtons!Parking!Master!
Plan)!as!proEbono!consultant!to!generate!an!empirical!report!on!required!parking!for!the!building!program!as!
projected,!as!well!as!a!"white!paper"!outline!of!the!steps!and!associated!costs!to!achieve!a!greater!waterfront!/!
event!parking!plan!with!the!city.!

1. Project Description!
!!
Once!a!coalEfired!power!plant,!the!Moran!Plant!will!become!an!energyEnet!zero,!financially!selfE
sustaining!public!space!on!the!Burlington!waterfront.!This!space!will!be!managed!yearEround!by!New!
Moran,!Inc.,!a!Vermont!nonEprofit!organization.!
!!
The#Moran#Plant#will!be!home!to!three!building!blocks!of!activity:!
!!
1)!The#Market#Hall,!a!ground!level!marketplace!showcasing!Vermont!through!local!food,!drink,!arts,!
and!recreation.!Like!Chelsea!Market!in!NYC,!the!Ferry!Building!in!San!Francisco,!and!Atwater!Public!
Market!in!Montreal,!the!Moran!Plant!Market!Hall!will!be!home!to!a!variety!of!vendors,!small!and!
large.!Restaurants,!artisans,!artists,!retail!shops!and!education!spaces!will!fuse!commerce!and!
community!to!create!a!dynamic!public!space!rooted!in!the!place!and!heritage!of!our!city!and!state.!
!!
2)!The#Turbine#Hall,#a#1500!person!capacity,!flat!floor!community!event!space!with!an!industrial!
interior!and!lake!and!mountain!views,!hosting!a!regular!program!for!music,!conferences,!educational!
activities,!community!events!such!as!the!Winter!Farmers!Market,!private!functions,!and!largeEscale!
art!installation.!
!!
3)!Innovation#Space,!a!collaborative!workspace!dedicated!to!cultural!entrepreneurship,!education,!
and!fostering!connections!between!nonEprofit!organizations!and!socialEprofit!businesses.!!Located!
within!the!new!architecture!enclosing!the!steel!works!on!the!north!side!of!the!building,!the!space!will!
have!strong!coffee,!soaring!ceilings,!access!to!the!historic!Bunker!Gallery!and!Conveyor!Hall,!and!
unparalleled!western!lake!views.!
!!
The!building!will!remain!cityEowned.!New!Moran,!Inc.!will!be!the!nonEprofit!developer!through!
construction,!shifting!into!the!master!lessee!and!nonEprofit!manager!at!grand!opening.!
!!
As!the!master!operator!of!the!building,!NMI!will!lease!these!three!spaces!to!three!subEentities.!NMI!
will!coordinate!and!collaborate!with!these!entities,!the!Market!Hall,!the!Community!Event!Center,!
and!Innovation!Works,!to!consistently!welcome!the!public!and!maintain!the!building,!creating!a!sense!
of!place!and!cultural!identity!deeply!informed!by!the!history!of!the!Moran!Plant!and!the!surrounding!
waterfront.!
!!
Further!examples!of!New!Morans!activities!include!programming!a!living!museum!and!observation!
level!in!the!Conveyor!Hall!at!the!top!floor!of!the!building,!infusing!the!entire!building!and!site!with!art!
from!local!and!national!artists,!and!partnering!with!existing!and!future!organizations,!such!as!the!
Flynn!Center!or!the!Brewers!Festival,!to!hold!community!events!throughout!the!building.!
!!
!

2. Schematic Design Architectural Plans

R3 Exterior

June 22, 2015

R3 Section Cut

June 22, 2015

3. Project Budgets
Development and operating budgets are proprietary. Hard cost estimates are
included below. Additional information provided:
Total Project Cost: $33.7M
$33.7M includes $1,980,000 in cash reserves at opening and project
contingency exceeding 16.5% of all development costs.

!
4.Vermuelens Cost Estimate

June 18, 2015

Smith Buckley Architects
431 Pine Street
Burlington, VT 05401
Attention: Cleary Buckley
Re: Moran Plant
Dear Cleary,
Please find enclosed our revised cost estimate for the above project based on schematic design documents.

Main Building
Site Work
Enabling
Total

Area (sf)
67,833

$/sf
314

67,833

378

$,000s
21,269
3,562
798
25,629

This estimate includes all direct construction costs, general contractors overhead and profit, design and construction contingencies. Cost escalation assumes a Q3, 2016 construction start.
Excluded from the estimate are: hazardous waste removal, loose furnishings and equipment, utility consumption during construction, project contingency, architects and engineers fees, moving,
administrative and financing costs.
Bidding conditions are expected to reflect one construction manager, open bidding for sub-contractors, open specifications for materials and manufacturers.
This estimate is based on bids received in this market for comparable work. Projected changes in design and inflation are covered by contingency. Variances from these projections can occur due to
lack or surplus of bidders at time of bid, proprietary specifications, contractual and procurement practice, documentation and tendering changes, contractor's errors and omissions etc. We expect
bids received to be within 5 - 10% of estimated values 19 times out of 20 recognizing the above.
If you have any questions or require further analysis please do not hesitate to contact us.
Yours very truly,

James Vermeulen, PQS

Co-CEO

470 Atlantic Avenue, 4th Floor, Boston, MA 02210. 617.273.8430

9835 Leslie Street, Toronto, ON L4B 3Y4. 905.787.1880

14785 Preston Road, Suite 550, Dallas, TX, 75254. 972.789.5161

6080 Center Drive, 6th Floor, Los Angeles, CA 90056. 310.242.5856

15052 Version 05
Schematic Design

LEVEL 2 ELEMENTAL SUMMARY

Moran Plant
Renovation and Addition

$/sf

67,833 sf

GROSS FLOOR AREA

A1 SUBSTRUCTURE

Element $ %

4.18

283,254

01 Main Building

Estimate Date: 2015-06-18

Printed: 15:54 2015-06-18

02 Sitework

03 Enabling

$/sf

67,833

1%

4.18

283,254

$/sf

$/sf

A2 STRUCTURE

47.27

3,206,794 13%

47.27

3,206,794

A3 ENCLOSURE

53.83

3,651,353 14%

53.83

3,651,353

B1 PARTITIONS & DOORS

15.65

1,061,486

4%

15.65

1,061,486

B2 FINISHES

14.17

960,873

4%

14.17

960,873

9.90

671,573

3%

9.90

671,573

B3 FITTINGS & EQUIPMENT

C1 MECHANICAL

63.43

4,302,941 17%

63.43

4,302,941

C2 ELECTRICAL

36.63

2,484,409 10%

36.63

2,484,409

D1 SITE WORK

41.19

2,793,759 11%

0.00

2,793,759

0.00

626,060

245.05 16,622,682

2,793,759

D2 ANCILLARY WORK

9.23

626,060

2%

DIRECT CONSTRUCTION COST

295.47

Z1 GENERAL REQUIREMENTS

35.08

2,379,888

9%

29.29

1,986,609

321,282

71,997

Z2 CONTINGENCIES

47.27

3,206,800 13%

39.21

2,659,629

447,001

100,170

0.00

313.55 21,268,920

3,562,043

798,227

Z3 OTHER COSTS

TOTAL CONSTRUCTION COST

0.00

377.83

20,042,501 78%

0%

25,629,190 100%

626,060

E.1

15052 Version 05
Schematic Design
ELEMENTAL SUMMARY
GROSS FLOOR AREA

Level 3 Element $

$/sf

Moran Plant
Renovation and Addition
01 Main Building
67,833
$/sf

Estimate Date: 2015-06-18

Printed: 15:55 2015-06-18
02 Sitework
$/sf

03 Enabling
0

$/sf

A1 SUBSTRUCTURE
A11 Foundations
A12 Building Excavation

52,054
231,200

0.77
3.41

0.77
3.41

52,054
231,200

0
0

0
0

930,858
1,976,071
299,866

13.72
29.13
4.42

13.72
29.13
4.42

930,858
1,976,071
299,866

0
0
0

0
0
0

193,560
1,118,770
1,581,470
605,478
152,075

2.85
16.49
23.31
8.93
2.24

2.85
16.49
23.31
8.93
2.24

193,560
1,118,770
1,581,470
605,478
152,075

0
0
0
0
0

0
0
0
0
0

847,186
214,300

12.49
3.16

12.49
3.16

847,186
214,300

0
0

0
0

185,223
696,654
78,996

2.73
10.27
1.16

2.73
10.27
1.16

185,223
696,654
78,996

0
0
0

0
0
0

239,073
2,500
430,000

3.52
0.04
6.34

3.52
0.04
6.34

239,073
2,500
430,000

0
0
0

0
0
0

583,588
317,199
3,074,904
327,250

8.60
4.68
45.33
4.82

8.60
4.68
45.33
4.82

583,588
317,199
3,074,904
327,250

0
0
0
0

0
0
0
0

836,839
972,529
675,042

12.34
14.34
9.95

12.34
14.34
9.95

836,839
972,529
675,042

0
0
0

0
0
0

A2 STRUCTURE
A21 Lowest Floor Structure
A22 Upper Floor Structure
A23 Roof Structure

A3 ENCLOSURE
A31 Walls Below Grade
A32 Walls Above Grade
A33 Windows & Entrances
A34 Roof Covering
A35 Projections

B1 PARTITIONS & DOORS

B11 Partitions
B12 Doors

B2 FINISHES
B21 Floor Finishes
B22 Ceiling Finishes
B23 Wall Finishes

B3 FITTINGS & EQUIPMENT

B31 Fittings
B32 Equipment
B33 Conveying Systems

C1 MECHANICAL
C11 Plumbing & Drainage
C12 Fire Protection
C13 HVAC
C14 Controls

C2 ELECTRICAL
C21 Service & Distribution
C22 Lighting & Devices
C23 Systems

E.2

15052 Version 05
Schematic Design
ELEMENTAL SUMMARY
GROSS FLOOR AREA

Level 3 Element $

$/sf

Moran Plant
Renovation and Addition
01 Main Building
67,833
$/sf

Estimate Date: 2015-06-18

Printed: 15:55 2015-06-18
02 Sitework
$/sf

03 Enabling
0

$/sf

D1 SITE WORK
D11 Site Development
D12 Mechanical Site Services
D13 Electrical Site Services

2,232,477
324,050
237,233

32.91
4.78
3.50

0.00
0.00
0.00

0
0
0

2,232,477
324,050
237,233

0
0
0

276,060
350,000

4.07
5.16

0.00
0.00

0
0

0
0

276,060
350,000

245.05 16,622,682

2,793,759

626,060

D2 ANCILLARY WORK
D21 Demolition
D22 Alterations

DIRECT CONSTRUCTION COST

Z1 GENERAL REQUIREMENTS
Z11 General Requirements
Z12 Fee

9.4% 1,878,825
2.5%
501,063

27.70
7.39

23.16
6.13

1,571,041
415,567

251,438
69,844

56,345
15,652

8.0% 1,603,400
5.0% 1,002,125
3.0%
601,275

23.64
14.77
8.86

19.60
12.25
7.35

1,329,815
831,134
498,680

223,501
139,688
83,813

50,085
31,303
18,782

0.00

0.00

25,629,190 100% 313.55

21,268,920

3,562,043

798,227

Z2 CONTINGENCIES
Z21 Design Contingency
Z22 Escalation Contingency
Z23 Construction Contingency

Z3 OTHER COSTS
Z31 Other Costs

TOTAL CONSTRUCTION COST

0.0%

377.83

E.3

15052 Version 05
Schematic Design

Moran Plant
Renovation and Addition
01 Main Building

ELEMENTAL ESTIMATE
Description

Trade

Quantity

Rate

Quantity

Estimate Date: 2015-06-18

Printed: 15:55 2015-06-18
02 Sitework

Quantity

03 Enabling
$

Quantity

GROSS FLOOR AREA

Basement

16,146 sf

16,146

Level 01

8,752 sf

8,752

Level 02

17,231 sf

17,231

Level 03

8,342 sf

8,342

Level 04

8,878 sf

8,878

Level 05

5,322 sf

5,322

Level 07

3,162 sf

3,162

67,833 sf

67,833

TOTAL GROSS FLOOR AREA

REPORT NOTES

E.4

5. Updated Project Schedule

3.0 New Moran Project Timeline

6/22/15

Scope
Proposal

Milestone
Public TIF Vote

City
MOU (NMI and City of BTV)
Diligence Report
Project Term Sheet
Development Agreement
Managament

Incorporate New Entity

Major Tenant Commitments
Begin Formal NM/BTV Lease
Commence Full Operation
Parking Study

Finance

Capital Campaign Feasibility

Capital Campaign
Historic Tax Credit - PT 1
Historic Tax Credit - PT 2
Development Budget Refinement
CDE Solicitation
Applications for NMTC Allocations
Lender Solicitation
Underwriting
Commitments
Closing

Design

Assemble A&E Proposals

Schematic Design
Design Development
Construction Drawings

Permits

DRB - Design Permits

DPW - Construction Permits

Construction

RFP for CM Services

CM Selected
Construction
Grand Opening

Mar Apr

May

Jun

Jul

2014
Aug

Sep

Oct

Nov Dec

Jan

Feb

Mar

Apr

May

Jun

2015
Jul

Aug

Sep

Oct

Nov Dec

Jan

Feb

Mar

Apr

May

Jun

2016
Jul

Aug

Sep

Oct

Nov Dec

Jan

Feb

Mar

Apr

2017
May Jun

Jul

Aug

Sep

6. Market Study

THE MORAN PLANT:

REAL ESTATE MARKET ANALYSIS, JUNE 2015
Overview:
This report was completed by New Moran Inc (NMI) to analyze the local commercial real estate market,
determine the feasibility of proposed rental rates, and review projected operating expenses against existing
comparable real estate.
Conclusions are based on cross-reference analysis of the latest commercial real estate market survey and
forecast reports of Chittenden County from the Allen & Brooks Report dated December 2014, as well as direct
review of rent schedule and projected expenses with multiple Burlington real estate professionals with
significant property under management in the Burlington waterfront area.
Summary: Comparable Local Rental Rates
The Allen & Brooks Report
Retail Rental Rate Summary
Property Class

Rental Rates

Trend

CBD - Church Street

$25 - $35/SF

Strengthening

Premium Suburban

$17 - $35/SF

Stable

Above Average Suburban

$12 - 17/SF

Stable

CBD: Central Business District, Burlington VT

The Allen & Brooks Survey of Chittenden County retail space includes 5,420,000 square feet. Burlingtons inventory is comprised of
two components, the Central Business District (928,000 SF) and area outside of the CBD (283,000 SF).

The Allen & Brooks Report

Office Rental Rate Summary
Property Class

Net Rental Rates

Trend

CBD - Class A

$12 - $19/SF + parking

Stable

CBD - Class B

$8 - $12/SF + parking

Stable

CBD: Central Business District, Burlington VT

Pricing for Class A office space in the Central Business District ranges from $12 to $19.00 per square foot on a triple
net basis, i.e. with the tenant paying a pro rata share of all operating expenses, plus utilities and parking.
The upper end range for Class A is represented by the ICV project on Battery Street, known as Waterfront Plaza, and
the Lake & College Street (Main Street Landing) project which was completed in 2005. These high quality LEED
certified buildings, with lake view amenity, command premium rents in the market place.

As detailed above, commercial rental figures vary widely by type, location, and accessibility. Premier rental
spaces in downtown core and Church Street region range from $25-35/SF whereas premium suburban spaces
range from $17-35SF, and above average suburban retail figures range from $12-17/SF.
Class A office space in Burlingtons Central Business District range from $12-19/SF not including parking, and
Class B ranges from $8-12SF not including parking.
Common Area Maintenance (CAM):
The Allen & Brooks Report
2014 CAM Estimates: Chittenden County Retail Properties
Location

Range*

Average

Chittenden County

$2.10 - $5.25/SF

$3.39/SF

The Allen & Brooks Report

2014 CAM Estimates: Chittenden County Class A Office Properties
Location

Range*

Average

Burlington, VT

$6.75 - 7.50/SF

$7.114/SF

includes Heat & AC

Common Area Maintenance (CAM) charges are charges billed to tenants in a commercial lease based on their
pro rata share operating expenses of Landlords Property and Landlords Building, including repairs, insurance,
property maintenance, taxes, etc.
According to the Allen & Brooks 2014 report, Chittenden County retail CAM averages range between $2.105.25/SF, whereas office CAM fall slightly higher at between $6.75-7.50/SF.

The Allen & Brooks Report

Cost to Tenant Summary
Property Class

Net $/SF

Average CAM

Projected $/SF Cost to Tenants

CBD - Church Street

$25 - $35/SF

$3.39

$28.39 - 38.39 / SF

Premium Suburban

$17 - $35/SF

$3.39

$20.39 - 28.39 / SF

Above Average Suburban

$12 - 17/SF

$3.39

$15.39 - 20.39 / SF

Class A Office Space

$12 - 17/SF

$7.114

$19.114 - 24.114 / SF

Class B Office Space

$8 - $12/SF

$7.114

$15.114 - 19.114/ SF

The Moran Plant:

The Moran Plant sits at the heart of the north end of Burlingtons waterfront. Burlingtons greater waterfront,
while arguably the most valuable stretch of urban real estate in the state, despite new developments and
vibrant seasonal use of Waterfront Park and the Bike Path, still faces many challenges for business activity.
Chief among these challenges is stimulating more year-round activity. While vibrant during the warmer months,
the seasonality of visitorship to waterfront property makes it difficult for businesses to depend on customer
traffic. The same can be said for new businesses interested in operating on the waterfront, and particularly its
northern end. Existing property owners are often challenged to rent current spaces at market rents, making
new development that much more of a risk.
Based on these variables, the next step in commercial analysis is to determine the appropriate commercial
rental figures to to apply to this project. Results summarized below.

The Moran Plant

Commercial Rent Schedule

Tenant
First Level

Gross
SF

Leased SF

Net
$/SF

20,585
Market Hall

Second
Level

Share of Operating
Expenses

Projected
Cost to
Tenant

Projected $/SF Cost

to Tenant

Projected Business Terms

18,422

$ 9.00

$ 146,309

$ 312,107

$ 16.94

20,822

$ 6.33

$ 168,135

$ 300,000

$ 14.41

17,221

$ 9.00

$ 136,770

$ 291,759

$ 16.94

$ 448,228

$ 903, 866

23,604
Turbine Hall

Third Level

20,983
Innovation
Space
65,172

56,465

Conclusions:
As detailed above, Moran Plant total projected cost per square foot figures (net rent + CAM) are $16.94/SF in
both the Market Hall and Innovation Space. The same costs are $14.41/SF in the Turbine Hall.
In the Market Hall and Innovation Space, the gross figures reflect an approximately 40-56% ($16.93/SF :
$28.39-38.39/SF) reduction from Church Street rental figures, an approximately 17-40% ($16.93/SF vs .
$20.39 - 28.39/SF) reduction from rental figures in premium Chittenden County Suburban retail and are ~17%
below high-end Above Average Suburban retail (20.39 / SF) and ~10% above low-end Above Average
Suburban retail ($15.39/ SF)
As for office comparables, our rental rates represent an 11-30% reduction from Chittenden County Class A
office ($19.114-$24.114/SF) - The upper end range for Class A offices is represented by immediately adjacent

waterfront real estate at Main Street Landing. Our rates are show a 11% reduction from high-end Class B
offices, and are ~12% above low-end Class B offices.
The Turbine Hall reflects an approximately 49-62% reduction from premium Church Street spaces, a ~2949% reduction from premium Suburban spaces in Chittenden County, and ~6-29% reduction from Above
Average Suburban retail figures. As for office comparables, our rate reflect a 25%-40% reduction from Class A
office rental averages and a ~5%-25% reduction from Class B office rental averages.
CAM charges in the Moran Plant are approximately $7.94/SF. This is roughly 6% above the high-end for
Chittenden County Class A office properties ($7.50/SF), and about 11% above average ($7.114/SF). Moran
Plant CAM are $2.69/SF over the high-end for Chittenden County Retail Properties and $4.55/SF over
average. While CAM charges are slightly above comparable local averages, they include utilities,
communications and marketing expenses above typical lease arrangements. With that in mind, the increased
rate was expected and has been offset by lowering base Net $/SF cost, resulting in the universally below
average Gross Rent per SF outlined above.
Based on the data examined above and consultation with existing property managers in the Burlington area,
these rental figures are appropriate and achievable, taking into account existing tenant interest, nearby
comparable rentals, project cost, and inherent site variables such as year-round foot traffic. These projections
do mandate adequate parking on site or immediately adjacent to the Moran Plant. They also point to the need
for greater coordination between waterfront businesses and the city on shuttling and other creative measures
to make use of existing, non-waterfront, city parking infrastructure, while reducing barriers to accessing the
waterfront, especially during non-warm months.
Additional Analysis
1. We completed a review of rent schedule and projected expenses with three Burlington real estate
developers and brokers with significant property under management in the Burlington area and specifically the
waterfront. The conclusions were as follows:
a. The rental rates originally proposed ($14 PSF NNN, projected $24.08 PSF all in expense for
tenants), are on par with Class A office rates in the downtown~ and waterfront areas. While viable for
some tenants, they will preclude a variety of less established, profitable or well capitalized tenants,
especially in the food service, arts and education sectors. In addition, we changed our operating model
to reflect three master tenants, who would in turn sub-lease to smaller tenants and therefore require
lower up-front rental costs.
i. In response, gross rents were reduced 33-42% depending on intended use-class and lease
arrangement of each area in the building.
b. Operating expenses, and CAM charges by extension, were quite high for similar caliber buildings in
the Burlington market. Of note, projected recoverable expenses were 25-60% higher than other
buildings under local management in Burlington and on the waterfront.
i. Projected recoverable expenses for the Moran building include in-house management,
programming and marketing. While in one building, the services are loosely comparable to
those of Church Street Marketplace, and the included recoverable expenses echo the
Marketplace fee structure. While introducing an additional expense, the presence of

programming and marketing have been deemed essential to commercial viability of many
prospective tenants at Moran, and particularly in the winter.
ii. With that, recoverable expenses were adjusted based on operating expenses for comparable
spaces on the waterfront, resulting in a ~15% decrease in recoverable expenses.
iii. Non-recoverable expenses, which represent the administrative, staff and
professional costs of operating New Moran, Inc. were increased to reflect additional marketing,
community engagement, employee benefits and professional services, along with a greater
annual contingency.
c. Finally, the process by which tenants are reviewed under the Public Trust Doctrine will have an effect on the
ease of securing new tenants over time. This can be addressed through a clear articulation of an agreed upon
framework for tenant evaluation and acquisition which is both adaptable and enduring.
2. Two members of the NMI Board of Directors with significant experience in creative office and incubator
spaces provided insight and financial modeling to project potential use, tenant structure and alternative
financing structures within the Burlington community. The conclusions were:
a. The Moran Plant represents an iconic, dynamic and potentially highly desirable space for creative
collaboration, cultural and educational programming, and further development of Burlington as a hub for
technology, environmentalism and social innovation. The unique history and singular location can be
leveraged to create a vibrant, highly sought after space which meets a variety of needs.
b. There is an opportunity to explore corporate partnerships for ongoing underwriting of specific uses in
the building, and particularly those uses which provide direct community benefit. Such uses include
community meeting space equipped for audio/visual recording and broadcast, artisan and prototyping
space such as that of the existing Generator Maker Space, and food systems uses including
community garden education, food preparation and workforce development, and incubator space for
food service entrepreneurs.
c. It will be essential to solidify dynamic anchor tenants in order to attract a full cadre of tenants who
support the mission of the building and meet allowable uses under the Public Trust Doctrine.
d. While the program and appropriate anchor tenants are still under discussion, the initial conclusions
indicate strong potential to advance the mission of NMI through creative, dynamic partnerships with
local, regional and national companies and organizations interested in supporting a program which
serves all manner of Burlington residents and visitors.
3. A separate review was completed with the Flynn Center with regards to operating expenses. The Flynn
campus is within 10% of the projected square footage of Moran, and represents similar use classes across
their properties. As a non-profit managed historic structure, with significant programming on an annual, and
even daily basis, the Flynn provided a unique comparison. Projected Moran expenses are proportionally
appropriate to those of the Flynn Center, with some revisions made and an additional contingency included.