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Going Forward: <br />PSD and Parkview East are requesting some type of assistance that totals $50Ok in order to bridge the <br />gap of these cost overruns. Without this assistarice the project will not be able to proceed. There are <br />many irnportant factors that play into the timing of this project. They are as foIows: <br />1) There is a group that is proposing an apartment complex in Anoka. The market study <br />determined that demand in this area will overlap. Usually the first project in the ground will drive ou't <br />any competitors; therefore, if our project does not start first it will stall for an undetermined amount of <br />2) Given the rising construction costs we are experiencing, we anticipate costs can only go <br />higher. Apartrnent rental rates do not increase at the same proportion. <br />3) We are entering the fall season so if the project is pushed back too far we will incur winter <br />heat charges for the footing and foundation. This additiona expense orily magnffies the shortfall. <br />In conclusion, initially we thought the project could be developed and constructed without any type of <br />concessions or assistance. Once these additional costs were brought to our attention, we reassessed <br />the cost of this project. We have provided you a project cost overview for your review. As you know we <br />are dedicated to tliis City and want growth in all areas. To date, we have not received any assistance of <br />any type for the numerous projects we have developed in the COF. FeeI free to contact me ifyou have <br />additional questions or would like clarification regarding the information in this letter. <br />Matt Kuker <br />COO <br />