These two comparisons illustrate that, by purchasing the Coldwell Banker Building (South Office Building), the city avoids spending $13,266,670 in obligated lease payments which go away if the city owns rather than leases the building, an amount which is $4,616,670 greater than the cost of the building itself. In other words, by purchasing the building, the city will save taxpayers more than $4.5 million and own a 108,000 square-foot building that can be used to accommodate a variety of municipal and related purposes.

Schedule of Asset Values and Purchasing Costs - Market Value
 

		Replacement Cost		Market Value
	Coldwell Banker Building	$ 17,523,320	(1)	$   8,650,000
	Central Plant	6,975,000	(2)	3,925,000	(2)
A	Total Asset Values	$ 24,498,320		$ 12,575,000
B	Cost to Purchase	$  8,650,000		$  8,650,000
Future Avoided Costs
	Remaining Central Plant Lease Payments
C2	40 Year Lease Period	$ 13,266,670		$ 13,266,670
Net Cost of Purchase (Purchase Price Less Avoided Future Costs)
D2	40-year Lease Period	$ (4,616,670)	(B-C2)	$ (4,616,670)	(B-C2)
Asset Value of Transaction After Net Cost of Purchase
	40-year Lease Period	$ 29,114,990	(A-D2)	$ 17,191,670	(A-D2)
(1)	Pacific Gateway Development Report Dated February 28, 2012
(2)	Spearhead Valuation Group Report Dated December 2, 2011 (in continued use)

Schedule of Asset Values and Purchasing Costs - Net Present Value

		Replacement Cost		Market Value
	Coldwell Banker Building	$ 17,523,320	(1)	$  8,650,000
	Central Plant	6,975,000	(2)	3,925,000	(2)
A	Total Asset Values	$ 24,498,320		$ 12,575,000
B	Cost to Purchase	$  8,650,000		$  8,650,000
Future Avoided Costs (at Net Present Value)
	Remaining Central Plant Lease Payments
C2	40 Year Lease Period	$  7,285,802		$  7,285,802
Net Cost of Purchase (at Net Present Value Purchase Price Less Avoided NPV Future Costs)
D2	40-year Lease Period	$  1,364,198	(B-C2)	$1,364,198	(B-C2)
Asset Value Gain on Transaction after Net Cost of Purchase (at Net Present Value)
	40-year Lease Period	$ 23,134,122	(A-D2)	$ 11,210,802	(A-D2)
(1)	Pacific Gateway Development Report Dated February 28, 2012
(2)	Spearhead Valuation Group Report Dated December 2, 2011 (in continued use)