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~ethodoloev According to the contract for professional services, we have compared the present value of the cost of renting spacs at market levels for Class A/B buildings with the projected construction cost. Additionally, we compared the present value of the cost of market rent to the present value of scheduled contract rent and reversionary value of the building. The specified period is fiscal year July 1, 1999, to fiscal year 2025, which is represented as a 26-year period. The estimated market rent is based on a market rent survey of Salem CBD Class A/B buildings. The concluded lease rates will then be analyzed (using discounted cash flow analysis) with a discount to present value of the proposed total lease income for the Marion County space compazed to the reported cost to build the Marion County office space, exclusive of the'IYansit District's contribukion. This technique will be iden6fied as Technique 1. The second technique will compare the present value of the lease income stream to the proposed contracVownership, which includes the proposed contract amount ($1.30/SF) plus the reversion at the end of the 26-year period of the land and building value. These two techniques will be summarized in the Summary section. Salem CBD Of~ce Market Ov rvi w m^t~ The Salem office market is influenced by the overall economic influences on the Salem metropolitan area. The area has displayed positive economic influences, with the recent U.S. Territory 1998 Regional Economic Review and Forecast by the Economics Department of US Bank stating: "The Salem metropolitan area offers the stabiliry of a state capitol complex, a productive, diverse agricultural sector, forest products, one of the State's most populaz tourist destinaflons, a growing technology sector, and the stimulus of a private university. All of this is within one hour's drive of a large, rapidly growing urban area. This is a combination that should result in continued strong growth in Salem, despite the leveling out in the State govemment complex."