Questions - Edison Redevelopment Project

Bert Peronilla, Pleasant Valley Way.    I asked 6 questions at the April 9 Town Council Meeting.  While still waiting for the answers, I put together tentative answers to my own questions, using some data from the documentations sent to me by Councilwoman McCartney, and my own assumptions, based on “common sense”, subject to corrections/comments/answers from anyone.

1. When is the estimated start of construction?  ANSWER:  Prism is not yet sure
of the answer to this?

Questions
2, 3, and 4 pertain to cashflows to and from the Township.

2  When is the estimated completion of construction and ready for occupancy?  ANSWER:  Two years after start of construction.

3.  When does Prism start the payment of the Pilot and special assessment for the $3.15M to the Township?  ANSWER:  Two years after the completion of Phase I.

4. When does the Township start paying for the debt service for the $6.3 million
general obligation bond?  ANSWER:  At the start of construction, when Prism obtains the $50M financing.

The gist of my question is to find out what cashflow goes to the township during the first four years, before payment of the Pilot from Prism starts.  The township will have a negative cashflow of $409,816 per year for four years.  If Prism continues to pay the Land Tax during the first four years, then the negative cashflow will be $409,816 - $152,765 = $257,051.  Where will this money come
from?  There must be contractual arrangements to address this that I am not aware of? 

5.  What is the anticipated monthly rent for each type of unit in the Redevelopment which Prism used, to project an annual gross revenue of $9.5 million at 95% occupancy?   ANSWER:  While waiting for Prism’s response, assume Average Loft Rent = $1800, Main Street Units Rent = $3500, Penthouse Rent = $7200, to come up with the following pro-forma projected revenues: 285 lofts x $1800 + 34 Main St Apts, x $3500 + 14 Penthouses x $7200 = $8,793,600.  This approximates:  Total Rentals = $8,800,000 per Prism’s Final Presentation at 100% occupancy.  This is just a pro­-forma to help arrive at a conclusion, if the projected rentals will sell to the public.

Question 6 is:

6.  If Prism decides to sell units in addition to rentals, how will this affect the
calculation of the Pilot, which is currently 10% of Prism’s Gross Revenue with
Minimum of $650,000 minus the land tax of $152,765?   ANSWER:  The answer to this question may affect the calculation of the Pilot.