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Salem Area Mass Transit District Courthouse Square PROPERTY ACQUISITION Purpose: The purpose of the property acquisition analysis is to establish the reasonable basis for the purchase of an undivided 42% ownership interest in the real property described as Block 5, SALEM, Marion County, Oregon ("Courthouse Square Block") by the Salem Area Mass Transit District from Marion County. The combined County-Transit District ownership of the real estate provides the foundation for the development of the Courthouse Square Project consisting of a transit mall, transit facilities and offices, County offices and the opportunity for transit related private development. The joint ownership provides the basis for joint development of the property, joint occupancy of the property, and the sharing of expenses of demolition, abatement, relocation and unfunded streetscape requirements. It also provides the basis for revenue sharing of rentals associated with the opportunity site. Principles: The purchase of an ownership interest in the real estate is premised on the fact that the Transit District should not purchase an asset which is not dedicated to transit use. Thus, the Transit District should demonstrate that not less than 42% of the usable space within the development will be owned by the Transit District and devoted to transit or transit related use. If the Transit District will own and occupy at least 42% of the usable space, then the Transit District will have acquired what it has paid for. Analysis: The total usable square footage of the proposed development is 214,979.51 square feet. This includes a 66,824 square foot bus mall, together with all office space and common areas including a plaza. The Transit District will own 25,028.93 square feet within the office building, excluding common areas, out of a total of 127,339.71 square feet of office space in the office building. The Transit District's share of the office space in the building is then 19.6552453%. The Transit District will own an undivided interest in the common areas equal to 19.6552453%. Applying this percentage to the total common areas of 20,815.80 square feet gives the Transit District's share of common areas: 4,091.40. Adding the Transit District's office space (25,028.93), transit mall (66,824) and common areas (4,091.40) gives the total Transit District ownership interest in the development: 95,944.33 square feet. The Transit District's percentage ownership of the usable space is therefore 95,944.33/214,979.51, or 44.62%. This means that the Transit District has not purchased more of an undivided interest in the real estate than is necessary, given its occupancy of the proposed development. The analysis excludes the parking level. The parking is excluded because it will be constructed entirely by the County at its expense, and will be owned by the County. The Transit District does not believe that the Property Acquisition Courthouse Square 06/24/98 Page - 1