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03/06/98 FRI 1 i:10 FA1 503 223 ~606 hIELVIN DfARh CODZPANIES I~] 002 <br />emo <br />To: Billy Wasson <br />From: Craig Lewis; Projed Manager <br />Dato: 03/06/98 ~ <br />Re: Correlation beiween amount borrowed and annual debt service <br />Billy- <br />Per yout request, I have adjusted the loan debt on the previous model to establish the sensitivity <br />beiween the project cost borrowed and annual debt senrice. <br />Sased on a County occupancy of 96,622, a0 5.25°r6 interest rate on a 25 year ioan the impacts are as <br />~ follows: <br />Reduce the amount borrowed by: 510,000 and the redudfan in annual debt service is: $719/ year <br />Reduce the amount borrowed by: ~100,000 and the reductiun in annual debt s~rvice is: $7,192/ year <br />Reduce the amount borrowed by: ;1,000,000 and the reduction in annual debt senrice is: $71,914/ <br />year <br />Correlsting these amounts to rent impacts I calculated that a$71,190 ~eduction in annual debt service <br />would result in a$.74 / year ($,062/ mo,) redudion in required County (exduding spec and Transit) <br />rent. By my estimates, the Countys monthly rer~t would be slightly less than $1.24 per rsf per mo. <br />instead of the infamous $1.30. <br />~ <br />~ Page 1 <br />