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Note: Starboard of Miami is a single-phase construction project.
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GROUND LEASE ANALYSIS Specific Lease Terms
Existing Financial Position
A. Land Lease Evaluation Base Rent $10/sf $20/sf $25/sf $30/sf
Years 2018 2014 2031 2041 2051
Returns Discount Rate 6.3% NPV 75 year $ 142,654,495 NPV 18 year $ 74,669,780
2061 2071 2081 2091
Years 2016 to 2020 2021 to 2025 2026 to 2035 2036 to 2091
Escalation 5% 5% 10% 10% 10% 10% 10% 10% 10%
B. Land Lease Including Cash Flow and Capital Event Participation Returns
Discount Rate NPV 75 year $ NPV 18 year $
Cash Flow: Development 6.3% Partner is offering 10% of 171,047,290 their Leveraged Cash Flow 103,062,574 share to PortMiami.
Capital Event: Affordable Housing will be donated to PortMiami after a 10-year holding period. Using 7% cap rate, the value upon donation will be $57MM. C. Intangible - Land Value Creation - 192,000 SF of open space yields opportunities for flexible Program and community outreach space - Immediate adjacency to transit plaza - Sustainable Development/ LEED Platinum Facility: water conservation, energy efficiency, site sensibility and connection to alternative transportation -- main cornerstones of the project.
MSRC Ground Lease Base Rent $ 1 Discount Rate 2.5% NPV 18 year $ 4,894,961
Years 2013 2018 2023 2028 2033
Escalation 10% 10% 10% 10% 10%
The Discount Rate is lower than Starboard of Miami’s rate due to MSRC’s minimized risk of their existing lease structure;
Starboard of Miami is offering 21x better return* *Using 18 years holding period
PortMiami Land Sale Option PortMiami Land Sales Land value $ 49,005,000 Investment return 6.8% Increase 2% NPV 75 year $67,316,549 NPV 18 year $39,082,839
The Investment return is 5% higher than the Starboard’s discount rate based on opportunity cost;
Starboard of Miami is offering 2.6x better return* *Using 18 years holding period
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FINANCIAL AND SENSITIVITY ANALYSIS
BASELINE ASSUMPTIONS
General Note: Development Partner’s returns are generated after 10% reduction from ground land lease cash flow participation
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SOURCES AND USES
(Financial Closing Cost)
View towards the city
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STARBOARD OF MIAMI
View From Port Miami 15