Property Acquisition Discussion

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Because of the comparatively high cost of structured parking as just demonstrated, Rich and Associates have conducted a preliminary evaluation of the impact and benefits to the University from acquiring some nearby residential properties in the vicinity of Lot 16 on which additional surface parking could be constructed. Assuming an average cost of $100,000 to acquire each property together with the costs of demolition (using $15,000 per property) and construction of surface parking, we estimate the total to be $812,000. Divided by the estimated 141 spaces that could be developed assuming one large lot from the combination of 4 properties gives an average costs to provide each space to be $5,762. Obviously, this is significantly below what the costs would be to provide parking spaces in a structure. Table 11 below shows the average costs per space assuming different average purchase prices and assumed costs estimates for demolition and lot construction.

Property Acquisition Table 11

Given the relatively low costs at even the high end of $7200 per space to develop the anticipated 141 spaces, there would be compelling reasons to pursue this development option. The addition of the 141 spaces would significantly improve the prospects for Performing Arts Theatre patrons. We would expect the average purchase prices to be in the $100,000 to $125,000 range which results in estimated cost to provide each parking space at $5,600 to $6,500 per space. Compared to an estimated $10,000 per space for construction cost only for structured parking, these costs are actually very favorable considering that 141 net additional spaces could be created for an expected.

$812,000 to $912,000 versus adding 200 net additional spaces in a tabletop facility for $3.7 million dollars the savings make for a very easy decision.