7*4*0/
45"5&.&/5 )05
41054 13*03*5:
*/7&45.&/5
-0$"5*0/4

7*4*0/
45"5&.&/5 7*4*0/
1-"/
3&$0..&/%"5*0/4 /&95
45&14 ."3,&5
456%: )*4503*$
3&1035 &$0/0.*$
3&7*5"-*;"5*0/ )064*/( (0"-4
$0..6/*5:
*/165 /&*()#03)00% (SFBUFS
1BSTPOT
"WFOVF

DUHDYLVLRQSODQ DSULO

"DLOPXMFHFNFOUT

&RXQFLORI6RXWK6LGH2UJDQL]DWLRQV &662 &RRUGLQDWLRQDQG&RPPXQLFDWLRQE\

+XQJDULDQ9LOODJH6RFLHW\  6RXWK6LGH3ULGH&HQWHU

0DULRQ)UDQNOLQ$UHD&LYLF$VVRFLDWLRQ

0HULRQ9LOODJH&LYLF$VVRFLDWLRQ 0HHWLQJ6SDFH3URYLGHGE\ 2OGH6RXWK6LGH&RPPXQLW\3DUWQHUVKLS  6RXWK6LGH6HWWOHPHQW+RXVH 3DUVRQV$YHQXH0HUFKDQWV$VVRFLDWLRQ  5HHE+RVDFN&RPPXQLW\%DSWLVW&KXUFK 5HHE+RVDFN3ODQQLQJ&RPPLWWHH6WHHOWRQ9LOODJH  6W3DXO8QLWHG&KXUFKRI&KULVW 6DYH2XU6RXWKVLGH&LYLF$VVRFLDWLRQ &KLOGUHQ·V+RVSLWDO&HQWHUIRU&KLOG 6FKXPDFKHU3ODFH&LYLF$VVRFLDWLRQ  DQG)DPLO\$GYRFDF\

6RXWKVLGH&$1 3ODQNV5HVWDXUDQW

6RXWKVLGH1HLJKERUV$JDLQVW&ULPH

6RXWKHUQ2UFKDUGV6RXWKVLGH8QLWHG1HLJKERUV

6WDPEDXJK(OZRRG$VVRFLDWLRQ

9DVVRU9LOODJH&LYLF$VVRFLDWLRQ

1BHF

J

$POTVMUBOU
5FBN

%XUQV%HUWVFK +DUULV /HDG&RQVXOWDQW3ODQQLQJ3XEOLF)DFLOLWDWLRQ

32''HVLJQ 3ODQQLQJ*UDSKLF&RPPXQLFDWLRQV

9RJW:LOOLDPV %RZHQ 0DUNHW5HVHDUFK

1BHF

JJ

5BCMF
PG
$POUFOUT

 &9&$65*7&
46.."3:  7*4*0/
45"5&.&/5  $0..6/*5:
(0"-4  7*4*0/
1-"/
3&$0..&/%"5*0/4 
&$0/0.*$
3&4536$563*/(

=RQLQJ ,QFHQWLYHV  6RXWKHUQ*DWHZD\3ULRULW\,QYHVWPHQW/RFDWLRQ  &HQWUDO1HLJKERUKRRG3ULRULW\,QYHVWPHQW/RFDWLRQ  1RUWK3ULRULW\,QYHVWPHQW/RFDWLRQ  +RXVLQJ 1HLJKERUKRRG 
03("/*;"5*0/ 
%&4*(/ 
130.05*0/4 
13*03*5:
*/7&45.&/5
-0$"5*0/4
4*5&
1-"/4  /&95
45&14 $ "11&/%*9 $
,&:
"3&"4 $
$"4&
456%*&4 $
."3,&5
456%:

6XPPDU\RI5HSRUW$WWDFKHG  )XOO5HSRUWLQ6HSDUDWH9ROXPH $
)*4503*$
3&1035 $
$0..6/*5:
*/165

1BHF

JJJ

(SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

&YFDVUJWF
4VNNBSZ

1BHF
 1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

*OUSPEVDUJPO
'HSDUWPHQW SURYLGHG LQVLJKWV DERXW DYDLODEOH $ FRQVRUWLXP RI 6RXWKVLGH FRPPXQLW\ JURXSV UHVRXUFHVWKDWPD\EHDSSOLHGWRWKHUHYLWDOL]DWLRQ FKDOOHQJHG WKH &LW\ RI &ROXPEXV WR PDNH D HIIRUW ZLWKLQ WKH IUDPHZRUN RI WKH SODQ WKDW KDV FRQFHUWHG HIIRUW DQG LQYHVWPHQW WR VWLPXODWH EHHQ GHYHORSHG  7KH 6RXWKVLGH 1HLJKERUKRRG HFRQRPLFUHYLWDOL]DWLRQ RIWKH3DUVRQV$YHQXH 3ULGH &HQWHU DQG 'LUHFWRU -R $QQH 6W &ODLU D FRUULGRU DQG GHDO ZLWK SHUVLVWHQW SUREOHPV RI WUXVWHG FRPPXQLW\ OLDLVRQ ZDV LQYDOXDEOH IRU FULPHDQGSURSHUW\QHJOHFW PDLQWDLQLQJ FRPPXQLFDWLRQV ZLWK DOO LQYROYHG DQG WKH 6RXWKVLGH 6HWWOHPHQW +RXVH DQG ORFDO 7KURXJK WKH &ROXPEXV 8UEDQ *URZWK FKXUFKHVZHUHJHQHURXVLQSURYLGLQJWKHXVHRI 5HGHYHORSPHQW &RUSRUDWLRQ WKH &ROXPEXV WKHLUIDFLOLWLHVIRUWKHQXPHURXVPHHWLQJV &LW\ &RXQFLO·V QHZ -REV *URZWK )XQG SURYLGHG UHVRXUFHVWRWKHFRPPXQLW\WREHJLQWKLVVWXG\RI 'JOEJOHT PDUNHW FRQGLWLRQV DQG PDUNHW SRWHQWLDO IRU WKH )URPWKHRXWVHWLWZDVFOHDUWKDWWKHFRPPXQLW\ 3DUVRQV$YHQXHFRUULGRUDQGLWVUHODWLRQVKLSWRWKH VWUXJJOHV ZLWK FULPH WUDIÀ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· UHDO HVWDWH LQURDGV IRU FULPLQDO DFWLYLW\ DOFRKRO VDOHV WR GHYHORSPHQW DQG OHQGLQJ FRPPXQLWLHV  0DQ\ PLQRUV SURVWLWXWLRQ DQG YLROHQFH  7KH EOLJKW RWKHU VWDNHKROGHUV ZHUH FRQWDFWHG UHJDUGLQJ KDUPVWKHFRPPXQLW\·VLPDJHDUHDOWKUHDWWRLWV WKHLUSODQVDQGWKHLURZQDVVHVVPHQWRI6RXWKVLGH UHVLGHQWVDQG\RXQJSHRSOH7KHVHSUREOHPVDQG PDUNHW IRUFHV  0HPEHUV RI WKH &ROXPEXV WKHLUHIIHFWVIXUWKHUUHGXFHWKH$YHQXH·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

1BHF
 LVDQGZLOOEHDVDIHSODFHDVZHOODVDJRRGPDUNHW LQ ZKLFK WR LQYHVW DQG JURZ  $ FRPSUHKHQVLYH 7KH ORZHU LQFRPH DWWDLQPHQW RI PDQ\ RI WKH HFRQRPLF GHYHORSPHQW SURJUDP LV FUXFLDO WR UHVLGHQWV RI WKH 6RXWKVLGH QHLJKERUKRRGV À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ÁHFWLYHRIWKHSHULRGV RYHU ZKLFK WKH 6RXWKVLGH QHLJKERUKRRGV JUHZ ,WLVLPSRUWDQWWRQRWHWKDWWKHQHLJKERUKRRGVKDYH DQGZKLFKKHOSWRWHOOWKHVWRULHVRIWKLVFRPPXQLW\ QRWEHHQYHU\VXFFHVVIXOLQNHHSLQJWKHLU\RXQJ +RZHYHU 3DUVRQV $YHQXH LV DOVR VRPHWKLQJ RI SHRSOHDQGWKHDYHUDJHDJHRIKRXVHKROGHUVKDV DYLFWLP RI LWV SRSXODULW\ LQ WKH PLGWZHQWLHWK LQFUHDVHG7KRVHLQUHWLUHPHQWRUZLWKGLVDELOLWLHV FHQWXU\ZKHQSUHYDLOLQJIDVKLRQZDVWRHOLPLQDWH DUHOLNHO\WRUHPDLQRQÀ[HGLQFRPHVDQGQRWUH ROG H[SHQVLYH EXLOGLQJV DQG ´PRGHUQL]Hµ  7KH HQWHUWKHZRUNIRUFH,WZLOOEHLPSRUWDQWIRU\RXQJ ORVVRIWKHKLVWRULFIDEULFIURPWKHVHIRUFHVDVZHOO KRXVHKROGHUVWRÀQGRSSRUWXQLWLHVWRVWD\RQWKH DVIURPVRPHWLPHVLQHYLWDEOHHYHQWVOLNHÀUHDQG 6RXWKVLGHDVZHOODVDWWUDFWLQJQHZKRXVHKROGVWR IURPPRUHUHFHQWSUREOHPVRIDEDQGRQPHQWDQG UHSRSXODWHWKHQHLJKERUKRRGV QHJOHFW KDV FUHDWHG ´KROHVµ LQ WKH VWUHHWVFDSH WKDW GLPLQLVK WKH KLVWRULF VLJQLÀFDQFH RI WKH 6RPHFRPPXQLW\PHPEHUVDUHFRQFHUQHGWKDW FRUULGRU·V DUFKLWHFWXUH DV D SRWHQWLDO 1DWLRQDO DOWKRXJKWKHSODQWREULQJLQPRUHRIÀFHVDQGUHWDLO 5HJLVWHU HOLJLEOH +LVWRULF 'LVWULFW  6WLOO HQRXJK EXVLQHVVHVZLOOSURYLGHMREVWKHVHMREVPD\QRWEH RI WKLV IDEULF H[LVWV WR IRUP WKH IRXQGDWLRQ IRU D HTXLYDOHQWLQSD\RUEHQHÀWVWRWKHWKRXVDQGVWKDW PDUNHWLQJ LPDJH WKDW GUDZV LQVSLUDWLRQ IURP ZHUHORVWRYHUWKHODVWIRXUGHFDGHV+RZHYHUWKH KLVWRU\DQGDUFKLWHFWXUH FRQVWDQW´KHOSZDQWHGµDGYHUWLVLQJE\%XFNH\H 6WHHO &DVWLQJV GXULQJ WKH VWXG\ DQG FRPPHQWV 7KH0DUNHW$QDO\VLVORRNLQJDWDSULPDU\PDUNHW IURP RWKHU PDQXIDFWXUHUV RQ WKH 6RXWKVLGH WKDW DUHDFRPSULVHGRIWKHQHLJKERUKRRGVWKHPVHOYHV WKH\ DUH KDYLQJGLIÀFXOW\ UHFUXLWLQJ TXDOLÀHG GHPRQVWUDWHG WKDW DFWXDO FULPH VWDWLVWLFV DQG ZRUNHUV LQGLFDWHV WKDW WKHUH DUH RWKHU IDFWRUV LQ FHUWDLQ GHPRJUDSKLFV ZHUH QRW VXEVWDQWLDOO\ WKH HPSOR\PHQW HTXDWLRQ  7KHUH PD\ LQGHHG GLIIHUHQW WKDQ VRPH RWKHU QHLJKERUKRRGV WKDW EH QLFKH PDUNHWV LQ PDQXIDFWXULQJ WKDW FRXOG DUHXQGHUJRLQJUHQDLVVDQFHRUFRPSDUHGWRWKH VXSSRUW UHVHDUFK DQG GHYHORSPHQW LQFXEDWRUV &LW\DVDZKROH7KHFRUULGRUKDVJRRGDFFHVVWR DQGDSSUHQWLFHVKLSSURJUDPV'HYHORSPHQWRI &ROXPEXV·V GRZQWRZQ ,QWHUVWDWHV  DQG  WR DTXDOLÀ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

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

ɧ
PTF
MFTTPOT
BSF  D +RXVLQJLPSURYHPHQWVLQDGMDFHQWQHLJKERUKRRGVVXSSRUWFRPPHUFLDOLQYHVWPHQWDFWLYLW\  E &RPPHUFLDOLQYHVWPHQWVVWLPXODWHKRXVLQJDQGFRPPXQLW\LPSURYHPHQWVLQWKHQHLJKERUKRRGV  F /DUJHUVFDOHSURMHFWVJDUQHUWKHPRVWVSLQRIIRIDGGLWLRQDOLQYHVWPHQWDFWLYLW\  G ,PPHGLDWHYLVLEOHLPSURYHPHQWVUDLVHFRQÀ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ÀWVRI   XUEDQL]HGOLYLQJDQGDOORZVHQLRUFLWL]HQVWRUHPDLQLQWKHLUIDPLOLDUQHLJKERUKRRG

/LNHZLVHORFDOGHYHORSPHQWSURMHFWVSURYLGHH[DPSOHVRIVXFFHVVIXOLQWHJUDWLRQRIQHZFRQVWUXFWLRQDQG SRSXODUIUDQFKLVHVLQWRKLVWRULFWUDGLWLRQDOQHLJKERUKRRGV

7KHUHIRUHZLWKUHJDUGWRWKH3DUVRQV$YHQXH9LVLRQ3ODQWKHUHFRPPHQGDWLRQVKDYHEHHQEXLOWRQERWK WKH&RPPXQLW\*RDOVDQGWKHIROORZLQJJHQHUDOSULQFLSDOV0DQ\RIWKHUHFRPPHQGDWLRQVPHHWPRUH WKDQRQHRIWKHVHJHQHUDOSULQFLSDOV

%RWK HFRQRPLF GHYHORSPHQW  DQG FRPPXQLW\ GHYHORSPHQW WRROV PXVW EH HPSOR\HG WR DGGUHVV WKH FRPSUHKHQVLYHQHHGVRIWKH$YHQXH  ‡ *URZORFDOFDSDFLW\JURZDORFDOFRPPXQLW\GHYHORSPHQWFRUSRUDWLRQJURZVPDOOEXVLQHVVHV  ‡ (QFRXUDJHFRPPXQLW\JURXSVWREHFRPHPRUHHQWUHSUHQHXULDOWDNLQJRQLPSURYHPHQWSURMHFWV RIWKHLURZQ  ‡ 3DUWQHUVKLSVZLWKQRQSURÀWVFKXUFKHVVFKRROVDQGHPSOR\HUVWRFUHDWHPRUH\RXWKDFWLYLWLHV   DSSUHQWLFHVKLSVDQGMREVIRU\RXWK

6WDELOL]H1HLJKERUKRRGV  ‡ 6WHSXSFRGHHQIRUFHPHQWDQGQXLVDQFHDEDWHPHQWV  ‡ &RPPXQLW\FULPHSDWUROV  ‡ &RQWLQXHQXLVDQFHDQGFULPHUHSRUWLQJWKURXJK1HLJKERUKRRG&ULPH:DWFKDQG3ULGH3URJUDP  ‡ %ULQJLQPRUHKRXVHKROGVWKURXJKSURYLVLRQRIDYDULHW\RIKRXVLQJW\SHV5HKDELOLWDWHYDFDQWDQG   SURSHUWLHVQHZEXLOGLQÀOOORIWVW\OHFRQYHUVLRQV  ‡ 7UDIÀFFDOPLQJ

,QYHVWLQWKH1DWLRQDO7UXVW0DLQVWUHHW$SSURDFKŠWRFRPPHUFLDOUHYLWDOL]DWLRQ  ‡ (FRQRPLF5HVWUXFWXULQJ$JJUHVVLYHEXVLQHVVDWWUDFWLRQ JURZ   ‡ 5HFUXLWDQHFOHFWLFPL[RIUHWDLOHQWHUWDLQPHQWYHQXHVDQGVLWGRZQUHVWDXUDQWVHWKQLF    JOREDOIHHO   ‡ 5HFUXLWDEURDGPL[RIQHLJKERUKRRGDQGEXVLQHVVVHUYLFHEXVLQHVVHVDEDQN ‡6PDOOGHSDUWPHQWVWRUH  ‡ 2UJDQL]DWLRQ1HLJKERUKRRG&RPPHUFLDO0DQDJHU 1&0  ‡ 'HVLJQ(QIRUFHWKH8UEDQ&RPPHUFLDO2YHUOD\&RPPXQLW\FRQVHUYDWLRQSXEOLFRSHQVSDFH  ‡ 3URPRWLRQV)XQFWLRQRIWKH1&0FRRUGLQDWLQJZLWKEXVLQHVVHVDQGFRPPXQLW\JURXSV

,QYHVWLQWKUHHPDMRUUHYLWDOL]DWLRQSURMHFWV 3ULRULW\,QYHVWPHQWV WR´VHHGµWKH&RUULGRUDQGNLFNVWDUWDFWLYLW\  D 6RXWKHUQ*DWHZD\%XVLQHVV2IÀFH7UDGH'LVWULFW L 0L[HGXVHVRIÁH[RIÀFHVSDFHVEXVLQHVVLQFXEDWRUVHPHUJLQJWHFKQRORJ\LQWUDGHVWUDGH    VFKRROVDQGVXSSRUWLQJUHWDLOGHOLVIDUPPDUNHWVPDOOGHSDUWPHQWVWRUHVDQGVHUYLFHV  E &HQWUDO1HLJKERUKRRGWKH0LG7RZQRIWKH6RXWKVLGH L 0L[HGXVHVZLWKORIWVOLYHZRUNVSDFHQHLJKERUKRRGVFDOHUHWDLOUHVWDXUDQWVFDIHVDQGVHUYLFHV  F 1RUWK*DWHZD\&RPPHUFLDO'LVWULFW   L 0L[HGXVHVZLWKEDQNLQJVHUYLFHVRIÀFHVVLWGRZQUHVWDXUDQWVHQWHUWDLQPHQWIDFLOLWLHV

1BHF
 6LWH DQDO\VLV VKRZHG VHYHUDO ´.H\ $UHDVµ DUH FRQFHUQHG DERXW ÀQGLQJ ZD\V WR VWRS WKH SURSHUWLHV RU DUHDV RI SDUWLFXODU RSSRUWXQLW\ RU ORVV RI UHWDLO HVWDEOLVKPHQWV DQG WKXV VDOHV WD[ RIPDMRUFRQFHUQWRFRPPXQLW\PHPEHUV7KHVH UHYHQXH LQ WKH &RXQW\ LQ JHQHUDO HVSHFLDOO\ DUHDV UHSUHVHQW SODFHV ZKHUH VXFK VWUDWHJLF DV PDQ\ PRYH HYHU RXWZDUGV IURP HVWDEOLVKHG LQYHVWPHQWV PD\ ´VHHGµ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ÀFHUVUHYHUVLQJD WKDW WKH SURSRVDOV UHSUHVHQW RQO\ SRWHQWLDOV WKH WUHQGRIUHGXFWLRQRIFRGHZRUNIRUFH7KLVDORQJ FRQVXOWLQJ WHDP·V DSSOLFDWLRQ RI WKH 9LVLRQ WR ZLWK QHZ OHJLVODWLRQ EHLQJ GUDWWHG WR GHDO ZLWK SDUWLFXODUO\LPSRUWDQWVLWHV7KHSURSRVDOVGRQRW QXLVDQFHDEDWHPHQWZLOOGHÀQLWHO\KDYHDSRVLWLYH UHSUHVHQWLQDQ\ZD\VSHFLÀFSHQGLQJSURSRVDOV HIIHFWLQWKH3DUVRQVFRUULGRUQHLJKERUKRRGV7KH QRUGRWKH\VHUYHWRGLFWDWHWKHH[DFWIRUPWKDW &LW\·VDQG&RXQW\·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ÀQG %DUUHWW0LGGOH6FKRRODQG5HHE(OHPHQWDU\,I WKH+RW6SRW'LVFXVVLRQ&DVH6WXGLHV5HSRUWWKH WKHVHVFKRROVHYHQWXDOO\GRFORVHWKHEXLOGLQJV +LVWRULF5HSRUWDVXPPDU\RIWKH0DUNHW$QDO\VLV DQG VLWHV ZLOO UHSUHVHQW FKDOOHQJHV WR DGDSW DQGDUHFRXQWLQJRIWKH&RPPXQLW\,QSXWSURFHVV DQG UHXVH  7KH )UDQNOLQ &RXQW\ &RPPLVVLRQHUV 7KHIXOO0DUNHW6WXG\UHSRUWLVSUHVHQWHGE\9RJW KDYH HPEDUNHG XSRQ WKHLU RZQ HFRQRPLF :LOOLDPV %RZHQXQGHUDVHSDUDWHFRYHU VWXG\ RI WKH UHWDLO LQGXVWU\ LQ WKH &RXQW\  7KH\

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

7JTJPO
4UBUFNFOU

7KH IROORZLQJ YLVLRQ VWDWHPHQW ZDV FUHDWHG DQG UHÀQHG RYHU VHYHUDO PHHWLQJV RI WKH 6WHHULQJ &RPPLWWHHDQGWKHFRPPXQLW\,WUHÁHFWVKLVWRU\ WUDGLWLRQGLYHUVLW\DQGFRQÀGHQFH

iɨ
F
(SFBUFS
1BSTPOT
"WFOVF
$PSSJEPS


XJMM
CF iɨ
F
"WFOVF w
UIF
CVTUMJOH
DFOUFS
PG
MJGF
BOE
DPNNFSDF
GPS $PMVNCVTT
NPTU
EJWFSTF
DPNNVOJUZ
CVJMU
PO
UJNF
IPOPSFE
USBEJUJPOT
XJUI
UIF
CFBVUZ
PG
HMBTT
UIF
FOEVSBODF
PG
TUFFM
BOE
UIF PQQPSUVOJUJFT
PG
UIF
XPSME
WJMMBHF
BU
JUT
EPPS
"
QMBDFy t
8IFSF
SFTJEFOUT
BOE
WJTJUPST

GFFM
TBGF
BOE
SFTQFDUFE t 8JUI
B
EJWFSTF

FDPOPNJDBMMZ

WJBCMF
NJY
PG
SFTJEFOUJBM
DPNNFSDJBM
JOEVTUSJBM
BOE
DPNNVOJUZ
VTFT t
8IJDI
JT
UIF
TPDJBM
BOE
FDPOPNJD
TQJOF
GPS
UIF
4PVUITJEF

1BHF
 1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

$PNNVOJUZ
(PBMT

7KURXJKRXW WKH SURFHVV RIGLVFRYHU\ DQG FRPPXQLW\LQSXW D QXPEHU RI LVVXHV ZHUH LGHQWLÀHGWKDW UHODWHWRWKHODFN RI HFRQRPLF YLWDOLW\ DORQJ 3DUVRQV $YHQXH  &RPPXQLW\ PHPEHUVXQGHUVWDQGWKH$YHQXHDVUHSUHVHQWLQJ WKH ´IURQW GRRUµ WR WKHLU QHLJKERUKRRGV DQG WKDWWKHEOLJKWRIWKH$YHQXHGLUHFWO\KDUPVWKHLU TXDOLW\RIOLIHDQGLPDJHLQWKH*UHDWHU&ROXPEXV DUHD7KH\DOVRUHPHPEHUPRUHSURVSHURXVWLPHV IRUWKH$YHQXHDQG6RXWKVLGHDQGÀUPO\EHOLHYH LQWKHSRWHQWLDOWRUHYLWDOL]HDQGEHFRPHYLEUDQW RQFH PRUH  7KH 9LVLRQ 6WDWHPHQW WKDW HYROYHG UHÁHFWVWKDWKLVWRU\DQGIXWXUHYLVLRQ

)RXUPDMRUJRDOVRIWKH9LVLRQ3ODQZHUHSURGXFHG E\ WKH 6WHHULQJ &RPPLWWHH  7KH\ DGGUHVV WKH QHLJKERUKRRG·V PDMRU LVVXHV EXW DOVR UHÁHFW WKH QHHGV RI 3DUVRQV $YHQXH DV D UHYLWDOL]LQJ FRPPHUFLDOFRUULGRU

1BHF
 (PBMT

&OIBODFNFOU
PG
*NBHF

4FOTF
PG
4BGFUZ

‡ $FKLHYHKLJKHUOHYHORIZHOOPDLQWDLQHGKRPHV ‡ ,QFUHDVHFRGHHQIRUFHPHQW ‡ &RPPXQLW\&RQVHUYDWLRQDSSURDFK ‡ ,QFUHDVHKRPHRZQHUVKLS ‡ 5HGXFHEXLOGLQJYDFDQFLHV ‡ ,GHQWLI\DQGPRWLYDWHGHUHOLFWODQGORUGV KRPHRZQHUV ‡ ,PSURYHGSHGHVWULDQHQYLURQPHQW ‡ 7UDIÀFFDOPLQJ ‡ /DQGVFDSLQJ OLJKWLQJ ‡ 5HGXFHFULPLQDODFWLYLW\ ‡ 6WHSSHGXSODZHQIRUFHPHQW ‡ &RPPXQLW\EDVHGODZHQIRUFHPHQW

(PBMT

&DPNPOJD
3FWJUBMJ[BUJPO

‡ 5HSRSXODWHWKH&RUULGRUZLWKHFOHFWLFPL[RI  HWKQLFUHVWDXUDQWVUHWDLORIÀFHVHQWHUWDLQPHQW  DQGSXEOLFXVHV ‡ 5HSURJUDPXQGHUXWLOL]HGLQGXVWULDOVSDFHIRUQHZ  HFRQRP\LQGXVWULHV ‡ &DSLWDOL]HRQSUR[LPLW\WR5LFNHQEDFNHU ‡ 'HYHORSQHZPDUNHWQLFKHV ‡ *URZQHZEXVLQHVVHV ‡ ,QFXEDWRUV $SSUHQWLFHVKLSV ‡ 6WDELOL]H QHLJKERUKRRGV WR LQFUHDVH LQYHVWRU  FRQÀGHQFH VHHDQG

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

(PBMT

&OIBODF
1VCMJD
'BDJMJUJFT
BOE
4FSWJDF

‡ ([SDQGOLEUDU\IDFLOLW\ ‡ &UHDWHPRUHSDUNV RSHQVSDFH ‡ $FFHVVLEOHUHFUHDWLRQDOIDFLOLWLHV ‡ 0HHWLQJ JDWKHULQJVSDFHV ‡ ([WHQVLYHXVHRIODQGVFDSH OLJKWLQJWR EXIIHUXVHVVRIWHQWKHHQYLURQPHQWDQG  FUHDWHLPDJH ‡ 3XEOLFDUW ‡ $UFKLWHFWXUDOIHDWXUHV ‡ &XVWRPL]H&LW\DQG1RQSURÀWSURJUDPV  WRVSHFLÀFQHHGVRIDUHD

(PBMT

5SBOTQPSUBUJPO
*NQSPWFNFOUT

‡ ,QFUHDVHDYDLODEOHSDUNLQJ ‡ ,PSOHPHQWWUDIÀFFDOPLQJ ‡ :LGHQVLGHZDONV ‡ 6XSSRUWLPSURYHGPDVVWUDQVLWFRQQHFWLRQV ‡ &UHDWHWUDQVLWFHQWHUZLWKVHUYLFHWR  HPSOR\PHQWFHQWHUV 5LFNHQEDFNHU

1BHF
 1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

7JTJPO
1MBO 3FDPNNFOEBUJPOT

7KH9LVLRQ3ODQ5HFRPPHQGDWLRQVDUHRUJDQL]HG DURXQGWKHH[SUHVVHGFRPPXQLW\JRDOVDQGWKH )RXU3RLQW$SSURDFKŠRIWKH0DLQVWUHHW3URJUDP RIWKH1DWLRQDO7UXVWIRU+LVWRULF3UHVHUYDWLRQ

1BHF
 *
&DPOPNJD
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ÀFXOWLHVZLWK WKH FXUUHQW &,W\ RI    &ROXPEXV=RQLQJ&RGH·VSHUPLWWHGXVHVZKHQWU\LQJWRDFFRPSOLVKWKHJRDOVRIWKH9LVLRQ    3ODQ $OWKRXJK WKH SUHGRPLQDQFH RI & DOORZV D QXPEHU RI OHVV GHVLUDEOH XVHV WKDW    KDYHEHJXQWRGRPLQDWHWKHFRUULGRUZKROHVDOHGRZQ]RQLQJZRXOGHOLPLQDWHVXFKGHVLUHG    XVHV DV GHSDUWPHQW VWRUHV JURFHU\ VXSHUPDUNHWV SHUIRUPLQJ DUWV FHQWHUV GLQQHU WKHDWHUV    DQGQLJKWFOXEV7KH&2IÀ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

E 8VHRILQFHQWLYHVWRVWLPXODWHTXDOLW\UHGHYHORSPHQWVDORQJFRUULGRU L 7D[LQFHQWLYHEXVLQHVVDWWUDFWLRQSURJUDPV8VHRIWD[DEDWHPHQWVWD[FUHGLWVRUWD[UHEDWHV    VKRXOGEHRIIHUHGWRDWWUDFWEXVLQHVVHVZLWKVWURQJEUDQGLGHQWLW\DQGSHUIRUPDQFHUHFRUGVWR    WKHGHVLJQDWHG3ULRULW\,QYHVWPHQW/RFDWLRQV LL 7D[ LQFHQWLYH SURJUDPV IRU FUHDWLYH ZRUNHUV ([SDQG XVH RI EXVLQHVV WD[ DEDWHPHQWV WD[    FUHGLWV RU WD[ UHEDWHV DQG VXSSRUWV WR LQGHSHQGHQW ZRUNHUV DUWV SURIHVVLRQDOV PLFUR    EXVLQHVVHV ZKRORFDWHWKHLUKRPHVDQGVWXGLRRIÀFHVWRD3DUVRQV$YHQXHDGGUHVV LLL 7D[LQFHQWLYHSURJUDPVIRUIDoDGHLPSURYHPHQWV6LPLODUO\WD[DEDWHPHQWVRUUHEDWHVVKRXOG    EHWDUJHWHGWRGHIUD\LQJFRVWVRIUHQRYDWLRQRIEXLOGLQJVRQ3DUVRQV$YHQXH(OLJLEOHUHQRYDWLRQV    PXVW EH FRQVLVWHQW ZLWK WKH 8UEDQ &RPPHUFLDO 2YHUOD\  7KH WD[ UHEDWHV DQG ZRXOG EH    DSSOLHGLQPXFKWKHVDPHZD\WKDWWKH\KDYHEHHQWRVWLPXODWHWKHFRQYHUVLRQRIVSDFHWR    KRXVLQJLQWKH'RZQWRZQ LY 8WLOL]HWKHUHVXOWVRIWKH)UDQNOLQ&RXQW\&RPPLVVLRQHUVVWXG\RIUHWDLOUHWHQWLRQZKLFKLVXQGHUZD\    DWSUHVHQW

F 6RXWKHUQ*DWHZD\3ULRULW\,QYHVWPHQW/RFDWLRQ 6LJQLÀFDQWFDSLWDOLQYHVWPHQWLVPRVWQHHGHGDW   WKH ´6RXWKHUQµ *DWHZD\  7KHUH DUH RSSRUWXQLWLHV WR DVVHPEOH ODUJH DPRXQWV RI ODQG LQ WKLV   DUHDSHUIRUPVHOHFWLYHGHPROLWLRQDQGUHGHYHORS7KLVDSSURDFKLVPRVWGHVLUDEOHWRFRUUHFW   H[LVWLQJVLWHSUREOHPVZLGHQVLGHZDONVFDOPKLJKVSHHGWUDIÀFSURYLGHVHFXUHSDUNLQJDQGEXLOGLQJ   DFFHVVLQFRUSRUDWHSODQWLQJVDQGDSOD]DLQWRWKHVWUHHWVFDSHSURYLGHEXLOGLQJVWKDWLQFRUSRUDWH   VWDWHRIWKHDUWWHFKQRORJLHVFUHDWLQJDKLJKO\DHVWKHWLFDQGIXQFWLRQDOGLVWULFW L &UHDWHDQDQFKRUWRWKHVRXWKHQGRI3DUVRQV$YHQXH0DUNHWQLFKHVH[LVWWRFUHDWHD%XVLQHVV 2IÀFH7UDGH5HWDLO'LVWULFW     8VHWKHWD[LQFHQWLYHVDYDLODEOHWKURXJK´5HJLRQDO)LQDQFH$XWKRULWLHV3RUW$XWKRULWLHVµ ([DPSOHVRIXVHLQFOXGHWKH2KLR6WDWH8QLYHUVLW\&DPSXV*DWHZD\DQGWKHQHZ&OLSSHUV 6WDGLXP     'HYHORSPHQWRI)OH[2IÀFH6SDFHWKDWFDQDFFRPPRGDWHPXOWLSOHDQGGLYHUVHXVHUV VXFKDVFDOOFHQWHUVEXVLQHVVVHUYLFHVJRYHUQPHQWVHUYLFHVKHDOWKIDFLOLWLHVDQGWUDLQLQJ FHQWHUV

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

    3DUWQHUZLWKWKHORFDO6PDOO%XVLQHVV'HYHORSPHQW&HQWHU 6%'& 8QLWHG:D\*UHDWHU &ROXPEXV &KDPEHU RI &RPPHUFH  LQGXVWU\ KLJKHU HGXFDWLRQ LQVWLWXWLRQV DQG 5LFNHQEDFNHU 3RUW $XWKRULW\ WR FUHDWH D EXVLQHVV LQFXEDWRU IRU VPDOO EXVLQHVVHV  LQ WKH LQGXVWULDO DUHDV HDVW RI 3DUVRQV $YHQXH 6HFWRUV PLJKW LQFOXGH WUDQVSRUWDWLRQ HQHUJ\ HIÀ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·V WRSD\IRUSXEOLFLPSURYHPHQWV

G &HQWUDO 1HLJKERUKRRG 3ULRULW\ ,QYHVWPHQW /RFDWLRQ   7KH DUHD DURXQG WKH :KLWWLHU 3DUVRQV LQWHUVHFWLRQ FRQWDLQV DQ H[FHOOHQW FROOHFWLRQ RIEXLOGLQJV ZLWK LQWDFW KLVWRULF FKDUDFWHU DQG   H[FHOOHQWSRWHQWLDOIRUGHYHORSPHQWRIO LYHZRUNVSDFHÀUVWVWRU\VSHFLDOW\UHWDLOFRIIHHVKRSVFDIHV   DQG JDOOHULHV  $V VXFK PRGHUDWH LQYHVWPHQWV PD\ KHOS WR UHDOL]H LWV SRWHQWLDO 7KLV DUHD   VKRXOG GHYHORS D FRQQHFWLRQ DORQJ :KLWWLHU FUHDWLQJ D V\QHUJ\ ZLWK WKH SURSRVHG :KLWWLHU   3HQLQVXODUHGHYHORSPHQW   L 3URYLGHWD[DEDWHPHQWVIRUFRQYHUVLRQRIYDFDQWRIÀ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ÀQDQFLQJIRUSXUFKDVLQJKRPHVDQGFRQGRPLQLXPV     &UHDWHDQDVVRFLDWLRQRILQGHSHQGHQWZRUNHUVWRSURYLGHDFFHVVWRDIIRUGDEOHKHDOWKLQVXUDQFH     &UHDWHVKDUHGPDUNHWLQJDQGSURPRWLRQVSURJUDPVIRUWKHSURGXFWVDQGVHUYLFHVRIWKH LQGHSHQGHQWZRUNHUFRPPXQLW\

H 1RUWK'LVWULFWDQG*DWHZD\3ULRULW\,QYHVWPHQW/RFDWLRQ7KLVDUHDKDVWKHVWURQJHVWLPPHGLDWH   PDUNHWVWUHQJWKDQGZLOOSUREDEO\UHTXLUHRQO\DIHZWDUJHWHGLQYHVWPHQWVWRVWLPXODWHUHYLWDOL]DWLRQ   ,WZLOOEHLPSRUWDQWWRDGKHUHWRWKH8UEDQ&RPPHUFLDO2YHUOD\VWDQGDUGVDQGVSLULWRIWKH9,VLRQ3ODQ L 0DUNHWVWUHQJWKZLOOEHDXJPHQWHGGXULQJ&KLOGUHQ·VUHGHYHORSPHQWDQGH[SDQVLRQ LL )RFXVHIIRUWVRQUHFUXLWPHQWRIUHVWDXUDQWDQGHQWHUWDLQPHQWYHQXHV     7KLVDUHDKDVSRWHQWLDOWREHWKHHSLFHQWHUIRUDZLGHYDULHW\RIHWKQLFGLQLQJHQWHUWDLQPHQW DQGVKRSSLQJH[SHULHQFHV     8WLOL]HDEDWHPHQWVRI&LW\SURSHUW\DQGRULQFRPHWD[HVWRUHFUXLWQHHGHGEXVLQHVVHV   LLL &UHDWHD*DWHZD\IHDWXUHDVDFRPPXQLW\SDUWQHUVKLSSURMHFW&RPPXQLW\JURXSVZRXOGMRLQ ZLWK&KLOGUHQ·V+RVSLWDO%REE&KHYUROHW*HRDQGRWKHUVWRGHVLJQDQGFUHDWHD*DWHZD\ IHDWXUHWRGUDZFRQVXPHUVLQWRWKH1RUWK*DWHZD\DQGGRZQ3DUVRQV$YHQXH·VUHYLWDOL]LQJ    FRPPHUFLDOGLVWULFWV %XVLQHVV,PSURYHPHQW'LVWULFWVRU7D[,QFUHPHQW)LQDQFLQJWRSD\IRUSXEOLFLPSURYHPHQWV LY 6HFXUH7UROOH\VKXWWOHVHUYLFHVWRWKH1RUWK'LVWULFW&ROXPEXV·VSURSRVHGWUROOH\V\VWHPVKRXOGVWRS    DW3DUVRQV$YHQXHFLUFXODWLQJDURXQGWKH&KLOGUHQ·V+RVSLWDO&DPSXVDQGEDFNWR'RZQWRZQ GXULQJOXQFKDQGHDUO\HYHQLQJKRXUV7KLVPD\EHYHU\LPSRUWDQWLQIXWXUH\HDUVZKHQFRQVWUXFWLRQ    RQWKH,QWHUVWDWH´VSOLWµEHJLQV

1BHF
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

J 6DIHW\ L $GG&ROXPEXV3ROLFH'HSDUWPHQW%LF\FOHSDWUROVLQGD\WLPH LL ,QFUHDVH9HKLFOH3DWUROVDWQLJKW   LLL ,QVWLWXWHD&RPPXQLW\&ULPH3DWUROV\VWHPVLPLODUWR&DPSXV$UHD LY (GXFDWHFRPPXQLW\DERXWGHIHQVLEOHVSDFHSULQFLSDOV     &DUHGIRUSURSHUWLHVGLVFRXUDJHFULPLQDODFWLYLW\     0RUHIRRWWUDIÀFJHQHUDWHGE\PRUHDFWLYLW\ZLOOGLVFRXUDJHFULPH     5HVWRUDWLRQRIZLQGRZVWRVWRUHIURQWVZLOOSXW´H\HVRQWKHVWUHHWµ     %XONSXUFKDVHSURJUDPVWRGHFUHDVHFRVWVRIVHFXULW\FDPHUDVDODUPV\VWHPVHWF Y7UDIÀFFDOPLQJ  (OLPLQDWHPRVWOHIWWXUQUHVWULFWLRQVRQ3DUVRQV$YHQXH     &RQVWUXFWVLGHZDONFRUQHUH[WHQVLRQVDURXQGSDUNLQJODQHVDWLQWHUVHFWLRQVZKHUHQRWLQ LQWHUIHUHQFHZLWKEXVVWRSQHHGV     0RUHEXVVKHOWHUVZLWKGHFRUDWLYHDSSHDO     /RZHUWKHVSHHGOLPLWWRPLOHVSHUKRXU

**
0SHBOJ[BUJPO  &UHDWHD1HLJKERUKRRG&RPPHUFLDO0DQDJHU 1&0 2IÀFH 7KLV0DQDJHUDQG%RDUGZRXOGIXQFWLRQLQPXFKWKHVDPHZD\DVDPDOOPDQDJHUZRXOGUHVSRQVLEOH IRUXQLÀHGPDQDJHPHQWRIWKHOHQJWKRI3DUVRQV$YHQXH7KLVSRVLWLRQUHTXLUHVH[SHULHQFHLQHFRQRPLF GHYHORSPHQW EXVLQHVV UHWHQWLRQ DQG H[SDQVLRQ VWUDWHJLHV DV ZHOO DV EXVLQHVV UHFUXLWPHQW FRQVHQVXV EXLOGLQJDQGRUJDQL]DWLRQVNLOOV7KHGXWLHVZRXOGLQFOXGH D 0DUNHWLQJDQGIDFLOLWDWLQJGHDOVWUXFWXULQJWRDWWUDFWWKHGHVLUHGXVHUVIRUWKHDYDLODEOHVSDFH L 7KLV SRVLWLRQ ZRXOG EHFRPH WKH IDFLOLWDWRU RI RU D OLQN WR UHFRPPHQGDWLRQV SURJUDPV LQ6HFWLRQ,DERYH LL &UHDWHDQGPDLQWDLQDGDWDEDVHRIDYDLODEOHSURSHUW\DQGSRVWLQJRQWKH,QWHUQHW

E 2YHUVLJKWFUHDWLQJSURJUDPVWRHQVXUHPDLQWHQDQFHRIWKHFOHDQOLQHVVDQGJHQHUDOHQYLURQPHQW

 F 0RQLWRULQJDQGIDFLOLWDWLQJKRXVLQJGHYHORSPHQWDFWLYLW\

 G 5HWHQWLRQDQG([SDQVLRQSURJUDPIRUH[LVWLQJ ZHOOUXQ EXVLQHVVHVLQWKHQHLJKERUKRRG

H &UHDWHDPDUNHWLQJSODQJUDSKLFVWKHPHVHYHQWVDQGSURPRWLRQV&DUU\WKHFRORUVDQGWKHPH   WKURXJKRQVLJQDJHSODQWPDWHULDOVVWUHHWIXUQLVKLQJVHWF

I 2UJDQL]H$YHQXHEHDXWLÀFDWLRQSURMHFWV L %RUURZHGLGHDVWKDWZRUNZHOOLQWKHXUEDQVWUHHWVFDSHLQFOXGHÁRUDOWKHPHV HJ)UDQNHQPXWK 0, ZLQGRZER[HVDQGSODQWHUV   LL :RUNZLWKFRPPXQLW\JURXSVWRRUJDQL]HKLUH\RXWKJURXSVWRSODQWDQGPDLQWDLQ3RWHQWLDO    SDUWQHUVLQFOXGH&ROXPEXV5HFUHDWLRQDQG3DUNVKRUWLFXOWXUHSURJUDPVDWWHFKVFKRROVDQG    VHUYLFHRUJDQL]DWLRQVWRJURZDQGSURYLGHSODQWPDWHULDOV   LLL 3RVVLEOHLPDJHWKHPHV´:RUOG9LOODJHµ´6WHHO *ODVVµ

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

J 2UJDQL]DWLRQRIWKH1&02IÀFH L ,Q,QGLDQDSROLVRQH0DQDJHULVXVXDOO\UHVSRQVLEOHIRUWZRWRWKUHHQHLJKERUKRRGFRPPHUFLDO FRUULGRUV3DUVRQV$YHQXHLVVRODUJHWKDWDGHGLFDWHGPDQDJHUZRXOGEHEHVW LL 6HHNIRXQGDWLRQDQGLQVWLWXWLRQVXSSRUWIRUVHHGPRQH\IRUWKLVRIÀFH   LLL $OORZ WKH 1&0 RUJDQL]DWLRQ WR DOVR FDUU\ RXW VPDOO UHGHYHORSPHQW SURMHFWV WR GHYHORS D UHYHQXH VWUHDP  7KH HIIRUW FRXOG EHJLQ ZLWK ODQG EDQN SURSHUWLHV ([LVWLQJ &RPPXQLW\ 8UEDQ 5HGHYHORSPHQW &RUSRUDWLRQV LQ &ROXPEXV    SURYLGH ÀQDQFLQJ PRGHO  7KH ÀUVW SURMHFW VKRXOG EH DQ LPSRUWDQW EXLOGLQJ WKDW ZRXOG EH    WKH1&0RIÀFHRQ3DUVRQV$YHQXH([FHVVVSDFHZRXOGEHOHDVHGRXWWRKHOSZLWKRSHUDWLRQV    FRVWV   LY /LNHDPDOOPDQJHUWKH1&0FRXOGUHWDLQRZQHUVKLSFRQWURORIDIHZSURSHUWLHVDFURVVWKH    FRUULGRU DQG FRXOG H[HUFLVH WKH RSWLRQ RI SURYLGLQJ IUHH EXLOG RXWV UHGXFHG UHQWV RU UHQW JXDUDQWHHVWRKLJKO\GHVLUDEOHQHZEXVLQHVVHVJHQHUDOO\WKRVHWKDWKDYHDQFKRUSRWHQWLDO   Y 7KH 1&0 ZRXOG FRRUGLQDWH DFWLYLWLHV ZLWK FRPPXQLW\ JURXSV DQG WKH 3DUVRQV $YHQXH    0HUFKDQW·V$VVRFLDWLRQ 3$0$  YL 7KH1&0ZRXOGDVVLVW3$0$LQLQFUHDVLQJLWVPHPEHUVKLS,WZRXOGGHYHORSLQFHQWLYHVVXFK    DVSD\LQJIRUPHPEHUVKLSVIRUÀUVW\HDUPHPEHUV YLL :KHQ WKH EXVLQHVV PL[ RQ WKH $YHQXH KDV VWUHQJWKHQHG WKH 1&0 FDQ DSSURDFK WKH EXVLQHVVFRPPXQLW\DERXWFUHDWLQJD%XVLQHVV6SHFLDO,PSURYHPHQW'LVWULFWWRIXQGVSHFLDO    LPSURYHPHQWSURMHFWVRUSURYLGHORQJWHUPIXQGLQJ

1BHF
 ***
%FTJHO

D (QIRUFHWKH8UEDQ&RPPHUFLDO2YHUOD\ VHH6HFWLRQ,DQG,,DERYH   6WXGLHVKDYHVKRZQWKDWGHVLJQLVDFRPPRQIDFWRULQDOOVXFFHVVIXOSURMHFWV L 3URWHFWDQGSURPRWHDGDSWLYHUHXVHRIVWUXFWXUHVZLWKDUFKLWHFWXUDOFKDUDFWHU7 K LVLVLPSRUWDQWWR LPDJHDQGWKHPHIRULGHQWLW\DQGPDUNHWLQJRIWKH$YHQXH LL 8WLOL]HUHKDEOLQNHGWD[UHEDWHVIRUFRPSOLDQWEXLOGLQJLPSURYHPHQWVERWKFRPPHUFLDODQG UHVLGHQWLDO   LLL &RGHHQIRUFHPHQW

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ÀHGUHQRYDWLRQZRUN *7

1SPNPUJPOT D 3URPRWLRQV DUH PRVWO\ D IXQFWLRQ RI WKH 1HLJKERUKRRG &RPPHUFLDO 0DQDJHU 2IÀFH 6HH ,,   2UJDQL]DWLRQPDUNHWLQJ  E &RPPXQLW\*URXSVHYHQWVVKRXOGEHFURVVPDUNHWHGZLWKWKHEXVLQHVVFRPPXQLW\  F 1HLJKERUKRRGV EXVLQHVVHV &LW\ DQG SDUWQHUV DOO MRLQ WRJHWKHU LQ SXEOLFL]LQJ DQG FHOHEUDWLQJ UHGHYHORSPHQWVXFFHVVHV

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

1SJPSJUZ
*OWFTUNFOU -PDBUJPO
4JUF
1MBOT

1BHF
 4PVUIFSO
(BUFXBZ



%XVLQHVV2IÀFH7UDGH'LVWULFW

9LHZRI1HZ5HWDLO&RQVWUXFWLRQ 8UEDQ3OD]D

9LHZRI)DUPHU·V0DUNHW 3RFNHW3DUN

/RFDWLRQ ([LVWLQJ6LWH

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ









 

   

3ODQ.H\

 1HZ&RQVWUXFWLRQ 2IÀFH,QVWLWXWLRQDO5HWDLO  8UEDQ3OD]D

 1HZ&RQVWUXFWLRQ$GDSWLYH5H8VH  )DUPHU·V0DUNHW

 1HZ3DUNLQJ/RWV 6SDFHV6)0LQLPXP  2XWGRRU'LVSOD\$UHD

 3RWHQWLDO5HVLGHQWLDO8VH  ´3RFNHW3DUNµ

1BHF
 $FOUSBM
/FJHICPSIPPE



WKH0LG7RZQRIWKH6RXWKVLGH

9LHZRI5HVWRUHG6WUHHWVFDSH

'HWDLORI1HZ,QÀOO%XLOGLQJDQG5HVWRUHG&0$&$2%XLOGLQJ

/RFDWLRQ ([LVWLQJ6LWH

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

 

 

 

3ODQ.H\

 5HPRYH6WRU\3RUWLRQRI&0$&$2%XLOGLQJ  5HVWRUDWLRQRI([LVWLQJ5HWDLO

 5HVWRUDWLRQ $GDSWLYH5H8VHRI&0$&$2%XLOGLQJ  1HZ3DUNLQJ/RW%HKLQG%XLOGLQJV

 ,QÀOO3DUNLQJ/RWZLWK1HZ%XLOGLQJ  6WUHHWVFDSH5HVWRUDWLRQ

1BHF
 /PSUI
%JTUSJDU

(BUFXBZ



&RPPHUFLDO'LVWULFW

9LHZRI5HVWRUHG6WUHHWVFDSH

([LVWLQJ6LWH

/RFDWLRQ

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ









 



3ODQ.H\

 /LEUDU\&RQYHUWV7R5HWDLO5HVWDXUDQW8VHV  3DUNLQJ5HFRQÀJXUDWLRQV

 1HZ&RQVWUXFWLRQ 5HWDLO5HVLGHQWLDO  5HPRYH$OOH\&UHDWH3HGHVWULDQ3OD]D

 $GDSWLYH5H8VH &KXUFKWR%DQN  6WUHHWVFDSH,PSURYHPHQWV

 5HQRYDWLRQ2I([LVWLQJ5HWDLO 1BHF
 1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

/FYU
4UFQT

7R DVVXUH WKDW WKH PXOWLIDFHWHG DFWLYLWLHV UHFRPPHQGHGE\WKLVSODQJRIRUZDUGD9LVLRQ 3ODQ,PSOHPHQWDWLRQ&RPPLWWHHVKRXOGEHIRUPHG ,QLWLDOO\WKLV&RPPLWWHHVKRXOGEHFRQVWLWXWHGIURP UHSUHVHQWDWLYHV IURP &ROXPEXV 8UEDQ *URZWK &RUSRUDWLRQ WKH 6RXWKVLGH FRPPXQLW\ WKH 1HLJKERUKRRG VHUYLFHV 'LYLVLRQ1HLJKERUKRRG /LDLVRQ &ROXPEXV 'HSDUWPHQW RI 'HYHORSPHQW HVSHFLDOO\ WKH (FRQRPLF 'HYHORSPHQW 'LYLVLRQ DQG /DQG 5HGHYHORSPHQW 2IÀFH  &LW\ &RXQFLO DQG WKH 1HLJKERUKRRG &RPPHUFLDO 3URMHFW 0DQDJHUZKHQKLUHG

7KLVJURXSVKRXOGPHHWDWOHDVWTXDUWHUO\IRUDERXW WZR WR ÀYH \HDUV WR UHSRUW RQ SURJUHVV RQ WKH SODQ DQG WR DFFHVV WKH H[SHUWLVH RI WKH RWKHUV 7KHJURXSZRXOGGHWHUPLQHIRULWVHOIZKHQRWKHU PHPEHUV VKRXOG EH UHFUXLWHG DQG ZKHQ WKH WLPLQJRIPHHWLQJVVKRXOGEHDOWHUHGDVQHHGHG WRDFFRPSOLVKWDVNVDVWKH\DULVH

$ UHFRPPHQGHG VHW RI HLJKW WDVNV DUHDV WR EH XQGHUWDNHQLPPHGLDWHO\LQFOXGH

1BHF
 
1SJPSJUZ
*OWFTUNFOU
-PDBUJPO

4PVUIFSO
(BUFXBZ

 D :KR&ROXPEXV8UEDQ*URZWK&RUSRUDWLRQ  E :KDW$JJUHJDWHSURSHUW\UHGHYHORSHDQGPDUNHWVLWH L $FTXLUHSURSHUWLHV   LL 'HYHORSSODQVZLWKFRPPXQLW\LQSXWDQGÀQDQFLDOSDFNDJHOLQHXSWHQDQWV LLL %HJLQFOHDUDQFHDQGFRQVWUXFWLRQ 
1SJPSJUZ
*OWFTUNFOU
-PDBUJPO

$FOUSBM
/FJHICPSIPPE

 D :KR1HLJKERUKRRG&RPPHUFLDO0DQDJHU2IÀFH  E :KDW WKH ROG  &ROXPEXV 0HWURSROLWDQ $UHD &RPPXQLW\ $FWLRQ 2UJDQL]DWLRQ  &0$&$2 EXLOGLQJRUERRNELQGHU\EXLOGLQJRURWKHUDYDLODEOHVXLWDEOHEXLOGLQJLQ   DUHD L $FTXLUHSURSHUW\IRURIÀFHVDQGLQFRPH LL 'HYHORSSODQVZLWKFRPPXQLW\LQSXWDQGÀQDQFLDOSDFNDJHOLQHXSWHQDQWVDQG SDUWQHUV LLL %HJLQFRQVWUXFWLRQ 
1SJPSJUZ
*OWFTUNFOU
-PDBUJPO

/PSUI
%JTUSJDU

 D :KR1HLJKERUKRRG&RPPHUFLDO0DQDJHU2IÀFH&LW\(FRQRPLF'HYHORSPHQW2IÀFH  E :KDW(FRQRPLFGHYHORSPHQWDFWLRQ   L 0DUNHWLQJDYDLODEOHEXLOGLQJVRUORWVWRQHHGHGQHZEXVLQHVVHVEDQNVDQGVLWGRZQ UHVWDXUDQWV LL 3URYLGHWD[LQFHQWLYHVWRDWWUDFW

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ


4FU
VQ
BO
-BOE
#BOL
QSPHSBN
UIBU
JT
OPU
GVOEFE
CZ
$PNNVOJUZ
%FWFMPQNFOU
#MPDL
(SBOU


$%#(
BOE
OPU
MJNJUFE
CZ
$%#(
SVMFT

 D :KR&ROXPEXV'HSDUWPHQWRI'HYHORSPHQW/DQG'HYHORSPHQW2IÀFH  E :KDW$FTXLUHSURSHUWLHVPDNH´VKRYHOµRU´KDPPHUµUHDG\IRUGHYHORSHUV 
5BY
JODFOUJWF
QSPHSBN

 D :KR&LW\&RXQFLOZLWKKHOSIURPWKH(FRQRPLF'HYHORSPHQW'LYLVLRQ  E :KDW([SDQGÀQDQFLDOLQFHQWLYHVWRVPDOOEXVLQHVVHV   L &UHDWHWD[LQFHQWLYHVWRHQWLFHGHVLUHGEXVLQHVVHVWRORFDWHRQWKH$YHQXHRI    &LW\SURSHUW\WD[HVSOXVUHEDWHRIFLW\LQFRPHWD[HVJHQHUDWHG LL &UHDWHWD[UHEDWHV RIFLW\WD[HV IRUUHKDEFRVWVIRUFHUWLÀHGIDoDGHLPSURYHPHQWV    UHVLGHQWLDODQGFRPPHUFLDODWOHDVWRIFRVWVSURUDWHGRYHU\HDUV LLL 8WLOL]H7D[,QFUHPHQW)LQDQFLQJ 7,) IRUSXEOLFLPSURYHPHQWZRUNWKDWVXSSRUWVQHZ    GHYHORSPHQWVRIDWOHDVW/)RIIURQWDJHRQ3DUVRQV$YHQXH 
$SFBUF
UIF
/FJHICPSIPPE
$PNNFSDJBM
.BOBHFS
0ċ

DF

 D :KR)RXQGLQJ%RDUG²5HSUHVHQWDWLYHVIURP&LW\&RXQFLO'HSDUWPHQWRI'HYHORSPHQW   &ROXPEXV8UEDQ*URZWK&RUSRUDWLRQ3DUVRQV$YHQXH0HUFKDQWV$VVRFLDWLRQ   3$0$  E :KDW(VWDEOLVKVWDUWXSSURFHGXUHV   L 'HÀQHUROHVDQGVW\HDUZRUNREMHFWLYHV     &HQWUDO1HLJKERUKRRG SURJUDPRIÀFH SURMHFW     &RUULGRULPDJHWKHPHDQGPDUNHWLQJSODQ   LL 6HWEXGJHW LLL $SSO\IRUVHHGIXQGV/RFDO,QLWLDWLYHV6XSSRUW&RUSRUDWLRQ /,6& DQGRWKHUV LY +LUHVWDII

1BHF
 
8PSL
XJUI
$JUZ
&OHJOFFSJOH

5SBċ

D
%JWJTJPO
UP
JOTUJUVUF
USBċ

D
JNQSPWFNFOUT

 D :KR9LVLRQ3ODQ,PSOHPHQWDWLRQ&RPPLWWHH  E :KDW7UDIÀFFDOPLQJ L 5HGXFHRUHOLPLQDWH´QROHIWWXUQµVLJQVDWWUDIÀFVLJQDOV   LL $OORZKRXUSDUNLQJLQPRVWDUHDVRI3DUVRQV$YHQXH H[FHSWLRQVPLJKWLQFOXGH RIFRXUVHEXVVWRSV LLL 5HGXFHWKHVSHHGOLPLWWRPLOHVSHUKRXU   LY 3HUPLW WKH EXLOGLQJ RI ´EXPS RXW LVODQGVµ WR UHVWULFW ODQHV DURXQG SDUNLQJ DW LQWHUVHFWLRQVZKHQUHGHYHORSPHQWRUVLGHZDONUHSODFHPHQWVRFFXU 
&YQMPSF
/PSUIFSO
(BUFXBZ
1BSUOFSTIJQT

 D :KR)RUPDVPDOOFRPPLWWHHRISURSHUW\RZQHUVLQWKH*DWHZD\DUHD6RXWKVLGH   FRPPXQLW\PHPEHUWKH'HVLJQ&HQWHUDQGWKH1HLJKERUKRRG&RPPHUFLDO3URMHFW   0DQDJHU2IÀFH  E :KDW([SORUHGHVLJQFRQFHSWVIRUFUHDWLQJDJDWHZD\HIIHFW L 0DMRU SURSHUW\RZQHUVLPSOHPHQW SURMHFWV RQ WKHLU SURSHUWLHV WKDW UHODWH WR WKH GHVLUHGJDWHZD\HIIHFW   LL 3URSRVHSXEOLFSOD]DRULQIUDVWUXFWXUHSURMHFWWKDWWLHVWKHJDWHZD\WRJHWKHU LLL ([SORUHIXQGLQJRSWLRQVIRUHDFKSKDVH

1BHF
 (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

"QQFOEJY

1BHF
" ,&:
"3&"4 7KHVLWHDQGLWVVXUURXQGLQJVOLHDWWKHFRPPHUFLDO 3DUW RI WKH SXUSRVH RI WKH VWXG\ SRUWLRQ RI WKH HQWU\WRWKH3DUVRQV&RUULGRUMXVWQRUWKRI%XFNH\H 3DUVRQV $YHQXH 9LVLRQ 3ODQ ZDV WR LGHQWLI\ 6WHHO&DVWLQJVDQGWKHVWUHHWRYHUSDVVFORVHWR6W SURSHUWLHV WKDW UHSUHVHQW ´.H\ $UHDVµ RI ERWK 5W,WWKHUHIRUHKDVVRPHORFDWLRQDGYDQWDJH RSSRUWXQLW\ DQG FRQFHUQ DORQJ WKH FRUULGRU 7KHVXUURXQGLQJVLQFOXGHDQRWKHUODUJHSDUFHODV ,QSXWV IRU WKLV SDUW RI WKH VWXG\ ZHUH JDWKHUHG ZHOODVRWKHUVPDOOHURQHVWKDWKDYHOLWWOHVWUXFWXUDO IURP UHFRPPHQGDWLRQV RI WKH KLVWRULF SURSHUW\ VLJQLÀFDQFH,IDJJUHJDWHGWKLVDUHDUHSUHVHQWV UHYLHZ WKH PDUNHW VWXG\ FRPPXQLW\ PHPEHUV D UHGHYHORSPHQW RSSRUWXQLW\ WKDW LV XQLTXH WR DQGHYDOXDWLRQRIODQGXVHSDWWHUQV DQ\ RWKHU SODFH DORQJ WKH FRUULGRU  $OWKRXJK WKH PDUNHW DQDO\VLV GRHV QRW VXJJHVW WKDW WKH $ ORW RI WKH JHQHUDO FRPPXQLW\ FRPPHQWDU\ VLWH ZRXOG EH DWWUDFWLYH WR DQRWKHU GHSDUWPHQW FOXVWHUHG DERXW SURSHUWLHV WKDW SUHVHQW D SRRU VWRUHLQWKHQHDUIXWXUHWKHORFDWLRQZRXOGOHQG DSSHDUDQFH  &OHDUO\ PDQDJLQJ WKH WXUQRYHU LWVHOIWRFRRUGLQDWHGUHGHYHORSPHQWRIDFHQWHU RIVXFKSURSHUWLHVWRLQVXUHLPSURYHPHQWVLQWKH HQFRPSDVVLQJ D EURDG PL[ RI XVHV LQFOXGLQJ UHWDLOPL[DQGDHVWKHWLFVQHHGVWREHDQRQJRLQJ WUDQVLW FRQQHFWLRQVRIÀFHV EXVLQHVV LQFXEDWRUV HIIRUW  6SHFLÀFDOO\ DQG IUHTXHQWO\ WKH RSLQLRQ HQODUJHPHQWRIWKH0DORQH\+HDOWK&HQWHUDQGD YRLFHGZDVWKDWDOOYDFDQWORWVDEDQGRQHGDQG YDULHW\RIUHWDLODQGVHUYLFHVWKDWZRXOGVHUYHWKH UXQGRZQ SURSHUWLHV VKRXOG EH FRQVLGHUHG .H\ VXUURXQGLQJEXVLQHVVDQGUHVLGHQWLDOFRPPXQLW\ $UHDV RI FRQFHUQ 6XFK SURSHUWLHV DUH PDJQHWV IRU GUXJV SURVWLWXWLRQ DQG YDJUDQWV VHULRXVO\ 7KH VXUURXQGLQJ DUHD LQFOXGHV WKH  EORFN GHWUDFWLQJ IURP WKH FRPPXQLW\·V LPDJH DQG RI 5HHE $YH ZKLFK UHSUHVHQWV WKH 6WHHOWRQ VHQVH RIVDIHW\  $QRWKHU JHQHUDOL]HG FRQFHUQ 1HLJKERUKRRG *DWHZD\  5HHE $YH ZDV ZDVWKHSUROLIHUDWLRQRIXVHGFDUORWV7KHVHW\SHV PHQWLRQHG E\DSDUWLFLSDQW EXW WKLV DGGUHVV RIXVHVLQWHUUXSWWKHPDVVLQJRIUHWDLOXVHVDORQJ LV QRW LQ DXGLWRU·V GDWD EDVH    5HHE $YH LV WKHFRUULGRUDQGPRVWO\KDYHQRWEHHQDWWHQWLYH WKH ROG )RRGOLQHU DQG  5HHE $YH LV 3RZHU WRDHVWKHWLFV RI 3UD\HU &KXUFK ZKLFK KDV EHHQ LGHQWLÀHG DV EHLQJSRWHQWLDOO\HOLJLEOHIRUWKH1DWLRQDO5HJLVWHU 7KH FRQVXOWLQJ WHDP LGHQWLÀHG WKH IROORZLQJ RI+LVWRULF3ODFHV7KLVIDFWVKRXOGEHWDNHQXQGHU SURSHUWLHVRUEORFNVWKDWUHSUHVHQWSDUWLFXODU.H\ FRQVLGHUDWLRQLQDQ\UHGHYHORSPHQWSURSRVDOV $UHDVIRUIXWXUHDWWHQWLRQ7KHVHSURSHUWLHVRUDUHDV DUHGHHPHGVLJQLÀFDQWGXHWRFOXVWHUVRIIDFWRUV WKDW DIIHFW HDFK VXFK DV PDUNHW RSSRUWXQLWLHV 7KHVH DUH SUHVHQWHG ZLWK SKRWRV PDSV RI WKHLU DUHDDQGDGHVFULSWLRQRIZKDWRSSRUWXQLWLHVRU FKDOOHQJHVWKH\UHSUHVHQW

3DUVRQV$YH6FKRWWHQVWHLQV6LWH 6XUURXQGLQJV 7KH6FKRWWHQVWHLQVVWRUHLWVHOILVRILPSRUWDQFHIRUD QXPEHURIUHDVRQV7KHFRPPXQLW\VWLOOVWLQJVIURP WKH UHFHQW ORVV RIWKLV ÁDJVKLS GHSDUWPHQW VWRUH ZKLFKKDGDORQJKLVWRU\RIJURZWKDQGVHUYLFHLQ WKLVFRPPXQLW\7KHFRPPXQLW\VWURQJO\GHVLUHVWR VHHWKHEXLOGLQJUHQRYDWHGRUUHSODFHGEXWZLWK DQ HPSKDVLV RQ UHXVH DV D VLPLODUO\ VL]H UHWDLOHU 0DUFV.RKOV7DUJHW  -XVWWRWKHHDVWRI3DUVRQV$YHQXHRQ0DULRQ5RDG LVDIDUPHU·VPDUNHWVWDQGZKLFKLVDFRPPXQLW\ LQVWLWXWLRQ IRU IUHVK IUXLWV DQG YHJHWDEOHV  7KH &LW\ RZQV SURSHUW\ EHKLQG WKLV ORW WKDW H[WHQGV QRUWKZDUGWKURXJKWKH EORFN  ,W UHSUHVHQWV DQ RSSRUWXQLW\ WR FUHDWH D PRUH RUJDQL]HG RSHQ VSDFHWKDWFRXOGFRH[LVWQLFHO\ZLWKWKHIDUPHU·V PDUNHW 

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

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

7KHIRUPHU)HGHUDO*ODVVEXLOGLQJ

7HFKQHJODV6LWH6RXWKZRRG 7KH QHZ RZQHU RIWKLV VLWH KDV SODQV WR SDUWLWLRQ WKH EXLOGLQJ WR OHDVH WR VPDOOHU PDQXIDFWXULQJ EXVLQHVVHVDQGFDOOFHQWHUV

/LQFROQ3DUN(OHPHQWDU\6FKRRO

:RRGURZ)HGHUDO*ODVV6LWH 0DULRQ5RDGVHUYHVDVDPDMRUFRQQHFWRUHDVWWR /RFNERXUQH 5RDG  $ QXPEHU RI ODUJH SURSHUWLHV WKDWRQFHKRXVHGPDMRUPDQXIDFWXULQJHPSOR\HUV VXFK DV )HGHUDO *ODVV DQG 7HFKQHJODV FDQ EH DFFHVVHGIURP0DULRQ5RDG7KHVHVLWHVUHSUHVHQW LPSRUWDQW RSSRUWXQLWLHV WR UHWRRO IRU FOHDQ PDQXIDFWXULQJEXVLQHVVHVWKDWVHUYHQLFKHPDUNHWV WKDWFRXOGSURYLGHH[FHOOHQWMREVIRUWKHUHVLGHQWVRI WKHFRPPXQLW\DQGUHLQIRUFHWKH&LW\·VWD[EDVH

1BHF
" 3DUVRQV/RLV0DQQ·V5HVWDXUDQW 3DUVRQV6:FRUQHUDW%HLKO$YH5HVLGHQWLDO EXLOGLQJV ZLWK KLVWRULF FKDUDFWHU RQH ZHOO NHSW WKH RWKHU QHHGHG UHKDELOLWDWLRQ $ PDS RI WKLV EORFNLVVKRZQEHORZ

7KH /RLV 0DQQ·V 5HVWDXUDQW VLWH VKRZQ RQ WKH PDS DERYH KDV WKH DGYDQWDJH RIEHLQJ SUHYLRXVO\ FOHDUHGDQGWKHH[LVWLQJEXLOGLQJLVDPLGWZHQWLHWK FHQWXU\LQÀOORIQRKLVWRULFVLJQLÀFDQFH7KLVVWUXFWXUHDQG SDUNLQJ ORW FXUUHQWO\ GHWUDFWV IURP WKH FRPPXQLW\·V LPDJHDQGEUHDNVWKHÁRZRIWKHVWUHHWVFDSH 0ROHU6WUHHWWR-HQNLQV$UHD

3DUVRQV ²IRUVDOH7KLVEXLOGLQJLVUHSUHVHQWDWLYH RI WKH 9LFWRULDQ ,WDOLDQDWH DUFKLWHFWXUH VFDWWHUHG WKURXJKRXWWKHFRUULGRU0DQ\RIWKHFKDUDFWHULVWLFV RI WKH ,WDOLDQDWH VW\OH VWLOO H[LVW LQ WKLV VWUXFWXUH DQG PDNHLWDVXLWDEOHFDQGLGDWHIRUUHKDELOLWDWLRQDQG SURGXFWLYHUHXVHSHUKDSVDVKRXVLQJ,QVSLWHRIWKH SRRUO\GRQHEXLOGLQJWRWKHEDFNRIWKHORWWKHUHDUH WZRRWKHUVWUXFWXUHVLQWKHVDPHEORFNVKRZQEHORZ WKDWUHLQIRUFHWKHSHULRGUHVLGHQWLDOFKDUDFWHURIWKLV EORFNLIWKH\FRXOGDOOEHUHKDELOLWDWHGDQGUHWDLQHG

7KHDUHDRIWKHLQWHUVHFWLRQRI)UHELV$YHQXHDQG 3DUVRQV FRQWDLQV DQFKRU VWRUHV .URJHU )RRGV &963KDUPDF\DQG7-·V&RXQWU\3ODFHUHVWDXUDQW DQGWKXVGUDZVDORWRIWUDIÀF9DOXDEOHDVWKHVH DQFKRUV DUH WKH SURPLQHQW SODFHPHQW RI ODUJH SDUNLQJORWVLQIURQWRIWKHEXLOGLQJVLQWUXGHRQWKH

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

KLVWRULF FKDUDFWHU RI WKH VWUHHW  ([DPSOHV H[LVW 7KLVFOXVWHURIUXQGRZQKRPHVÀ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ÀUHDQGXVHGIRUSURIHVVLRQDORIÀFH  3DUVRQV 8VHG FDU ORW DFURVV IURP .URJHU VSDFHDQGZRXOGDOVRFRQWULEXWHWRDQGEHQHÀW EXLOW IURP V\QHUJ\ ZLWK WKH H[LVWLQJ DQFKRU VWRUHV ,I GHPROLWLRQ DQG UHGHYHORSPHQW VKRXOG RFFXU LW VKRXOGEHLQNHHSLQJZLWKWKH8UEDQ&RPPHUFLDO 2YHUOD\ VWDQGDUGV  $Q H[FHOOHQW PRGHO IRU UHGHYHORSPHQW LV SURYLGHG E\ WKH ORFDO &DVH 6WXG\LQWKH&OLQWRQYLOOHDUHD7KHGHFRUDWLYHODPS SRVW VKRZQ LV HYLGHQFH RI VWUHHW LPSURYHPHQWV LQVWDOOHG E\ WKH &LW\ RI &ROXPEXV DV SDUW RID SDVW 1HLJKERUKRRG &RPPHUFLDO 5HYLWDOL]DWLRQ 3URJUDP

3DUVRQV  :KLWWLHU )URP 6WDQOH\ $YH VRXWK WR 7KLVORWFXUUHQWO\IRUVDOHFRXOGEHDFTXLUHGDQG 6LHEHUW 0LG&RUULGRU'LVWULFW UHGHYHORSHGEULQJLQJDQHZVWUXFWXUHLQWRDFORVHU UHODWLRQVKLS ZLWK WKH VWUHHW LQWURGXFLQJ D PRUH 7KLVWKUHHEORFNVWUHWFKRQWKHHDVWVLGHRI3DUVRQV V\PSDWKHWLF DUFKLWHFWXUDO VW\OH DQG LQWURGXFLQJ FRQWDLQV DQ H[FHOOHQW FROOHFWLRQ RIKLVWRULF DQHZUHWDLOXVHWKDWZRXOGEHQHÀWIURPDQGEXLOG EXLOGLQJVWKDWDUHLQYHU\JRRGVKDSH7KH\DUH RQWKHV\QHUJ\FUHDWHGE\WKHH[LVWLQJDQFKRUV JHQHUDOO\ RFFXSLHG ZLWK D YDULHW\ RI UHWDLO XVHV WKDW DUH FRPSOHPHQWHG E\ D JDVROLQH VWDWLRQ 3DUVRQV DQG3RVW2IÀFHRQWKHZHVWVLGHRIWKH:KLWWLHU 3DUVRQVLQWHUVHFWLRQ$VUHGHYHORSPHQWSODQVIRU WKH:KLWWLHU3HQQLQVXODSURFHHGDVWURQJQRGHRI FRPPHUFLDOXVHVLQWKLVDUHDFRXOGFUHDWHDVWURQJ V\QHUJ\DORQJ:KLWWLHU6WUHHWGUDZLQJFRQVXPHUV LQIURPWKHZHVW

7KLVDUHDSUREDEO\QHHGVRQO\PLQRULQYHVWPHQWV WRUHWDLQLWVFKDUDFWHUEXWZLOOEHQHÀWIURPFDUHIXO FRQVHUYDWLRQ RI WKH DVVHWV WKDW DUH WKHUH DQG VXSSRUWWRH[LVWLQJEXVLQHVVHV

1BHF
" 3DUVRQV/RFDWHGRQWKHVRXWKHDVWFRUQHURI :KLWWLHUDQG3DUVRQVWKLVEXLOGLQJDQGLWVEXVLQHVVHV DSSHDUERWKDGHTXDWHO\PDLQWDLQHGDQGYLDEOH FRQWULEXWLQJWRWKHFKDUDFWHURIWKLVDUHD

3DUVRQV8UEDQ2XWÀWWHUVFORWKLQJVWRUH

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ÀWFRPPXQLW\VKRXOGEHKHOGWRWKH JRDOVRIWKH9LVLRQ3ODQZLWKUHJDUGWRFKDQJHVWR WKH$YHQXHHQYLURQPHQW

$W WKH LQWHUVHFWLRQ RI5HLQKDUG $YHQXH LV D VWUXFWXUH VKRZQ DERYH DEDQGRQHG ZLWK WKH GHPLVH RI WKH &ROXPEXV 0HWURSROLWDQ $UHD &RPPXQLW\ $FWLRQ 2UJDQL]DWLRQ &0$&$2  7KH VXGGHQ ORVV RI WKH WHQDQWV RI WKH EXLOGLQJ FUHDWHG ERWK D YRLG LQ WKH FRPPXQLW\ DQG DQ RSSRUWXQLW\ IRU UHVWRUDWLRQ RI D PRUH SOHDVLQJ H[WHULRURIWKHEXLOGLQJ7KHEXLOGLQJDOVRKDVWKH DGYDQWDJH RI KDYLQJ VSDFH IRU SDUNLQJ LQ WKH EDFN6XFKDEXLOGLQJFRXOGEHUHGHYHORSHGZLWK 3DUVRQV .HVVFR'UXJ6WRUHLVIRUVDOH7KH UHWDLOVSDFHVVXFKDVJDOOHULHVRQWKHÀUVWÁRRUZLWK VWÁRRUUHWDLOVSDFHKDVEHHQEULFNHGLQVDFULÀFLQJ ORIWDSDUWPHQWVDERYH3ODQVZHUHGLVWULEXWHGRQ VRPH RI WKH FKDUDFWHU RI WKH VWUXFWXUH DQG WKHLQWHUQHWVKRZLQJWKHEXLOGLQJUHFRQÀJXUHGDV EORFNLQJWKHYLVXDOLQWHUHVWWKDWGLVSOD\ZLQGRZV XSVFDOHWRZQKRXVHFRQGRPLQLXPV(LWKHUZRXOG SURYLGH5HFHQWO\WKH&KXUFKIRUDOO3HRSOHKDV EHDGHVLUDEOHFRQÀJXUDWLRQDQGZRXOGWUDQVIRUP SXWIRUWKDSODQWRXVHWKHEXLOGLQJIRUDQXPEHURI WKHFXUUHQWEOLJKWWRDIHDWXUHGDVVHW7KHEXLOGLQJ LWVSURJUDPVDQGLVEHLQJHQFRXUDJHGWRUHVWRUH LVFXUUHQWO\RIIHUHGIRUVDOHE\+(5UHDOWRUV WKHVWRUHIURQWV

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

3DUVRQV7KHVHEXLOGLQJVIRXQGVRXWK WKH XVH RI SODQW PDWHULDO WR VRIWHQ WKH XUEDQ RI5HLQKDUG DUH GHQRWHG LQ WKH +LVWRULF 5HYLHZ KDUGVFDSH  7KLV LV D PRGHO GHPRQVWUDWLQJ WKDW SRUWLRQ RI WKH VWXG\ DV H[FHOOHQW H[DPSOHV RI D EXVLQHVV FDQ FRPSO\ ZLWK WKH &RPPHUFLDO WKH7XGRU5HYLYDOIRUPRIHDUO\WZHQWLHWKFHQWXU\ 2YHUOD\DQGDOVREHVXFFHVVIXO:LWKWKHLQFUHDVHG DUFKLWHFWXUH 7KH RZQHU VKRXOG EH UHFRJQL]HG WUDIÀF H[SHFWHG IURP WKH SHQGLQJ FRQVWUXFWLRQ IRUPDLQWDLQLQJWKHPLQWKHLUKLVWRULFFRQWH[WDQG DW &KLOGUHQ·V +RVSLWDO WKLV DUHD FDQ HYROYH LQWR WKLVRZQHUDQGRWKHUVZKRGROLNHZLVHVKRXOGEH DUHVWDXUDQW DQG HQWHUWDLQPHQW QRGH7KHORW SURYLGHGZLWKVXSSRUWZKHQQHHGHG GLUHFWO\DFURVV3DUVRQV$YHQXHLVFXUUHQWO\EHLQJ UHGHYHORSHG IRU D 6XEZD\ 6XE 6KRS )UDQFKLVH 7KH PDUNHW SRWHQWLDO LQ WKLV DUHD PD\ EH VWURQJ HQRXJK WR UHTXLUH OLWWOH &LW\ LQYHVWPHQW EXW LW LV LPSRUWDQWIRUWKH&LW\WRPDLQWDLQDKLJKVWDQGDUG IRUIXWXUHGHYHORSPHQWSODQV

 3DUVRQV ² &ROXPEXV 0HWURSROLWDQ /LEUDU\ 3DUVRQV$YH%UDQFK /LEUDU\VLWH EORFNWRVRXWK QRUWK

1RUWKHUQ 'LVWULFW  ([WHQGV URXJKO\ EHWZHHQ  3DUVRQV  3ODQN·V 5HVWDXUDQW DQG WKH 3DUVRQ·V /LYLQJVWRQ,QWHUVHFWLRQ

 3DUVRQV ² &ROXPEXV 0HWURSROLWDQ /LEUDU\ 3DUVRQV$YH%UDQFK

,W ZDV OHDUQHG WKDW WKH &ROXPEXV 0HWURSROLWDQ /LEUDU\ LV HYDOXDWLQJ DOO LWV IDFLOLWLHV DW WKLV WLPH 7KH3DUVRQV$YH%UDQFKLVPXFKWRRVPDOOIRULWV FXUUHQW XVDJH DQG PD\ QHHG WR EH HQODUJHG DQGRUUHORFDWHG,IPRYHGWKH/LEUDU\V\VWHP  3DUVRQV 3ODQN·V 5HVWDXUDQW KDV EHHQ D KDVVRPHHYLGHQFHWKDWLWVKRXOGORFDWHRQWKH FRPPXQLW\ À[WXUH IRU D QXPEHU RI \HDUV  7KH\ HDVWVLGHRI3DUVRQV$YHDQGEHPRUHFHQWUDOO\ KDYH GRQH DQ H[FHOOHQW MRE ZLWK UHWDLQLQJ WKH ORFDWHGZLWKLQWKH9LVLRQ3ODQVWXG\DUHD7KHVH KLVWRULFDSSHDORIWKHEXLOGLQJDQGLQFRUSRUDWLQJ GRUHSUHVHQWORQJWHUPSODQVÀYHWRWHQ\HDUVRXW

1BHF
" 7KH/LEUDU\KDVFRPPLWWHGLWVHOIWRHQJDJLQJWKH 6XJJHVWLRQV PDGH E\ FRPPXQLW\ PHPEHUV IRU SXEOLFZKHQUHDG\WREHJLQSODQQLQJWKLVSURMHFW IXWXUH/LEUDU\VLWHVLQFOXGHGWKHIROORZLQJ 

7KHH[SDQVLRQRIWKH/LEUDU\UHJDUGOHVVRIORFDWLRQ /RLV0DQQ·V5HVWDXUDQWVLWH UHSUHVHQWV D VLJQLÀFDQW IXWXUH EHQHÀW WR WKH  .URJHUVLWH VXUURXQGLQJFRPPXQLW\7KLVSURSRVDOUHSUHVHQWV  3DUVRQV :KLWWLHU GLVFXVVHGLQUHODWLRQWRWKH DFKDOOHQJHWRLGHQWLI\LQJDODUJHHQRXJKORFDWLRQ   &0$&$2EXLOGLQJ WKDWPHHWVWKHSDUDPHWHUVIRUUHEXLOGLQJ ZKLFK /LQFROQ3DUN(OHPHQWDU\6FKRROVLWH DIWHU DUHQRW\HWHVWDEOLVKHG EXWDOVRDQRSSRUWXQLW\   GHPROLWLRQ IRUUHXVHRIWKHFXUUHQWEXLOGLQJLQUHWDLORUFDIp  5HHE(OHPHQWDU\6FKRRO RQWKHVFKRRO VSDFHV7KHEXLOGLQJWKRXJKQRWKLVWRULFLVVWLOODQ   FORVLQJVOLVW DVVHWWRWKHFRPPXQLW\DQGLVFRQÀJXUHGLQDZD\  %HFN(OHPHQWDU\6FKRRO RQWKHVFKRRO WKDW ZRXOG HDVLO\ OHQG LWVHOI WR EHLQJ VXEGLYLGHG   FORVLQJVOLVW LQWRDVHULHVRIUHWDLODQGFDIpW\SHVRIXVHUV 3DUVRQV /LYLQJVWRQ$UHD   2WKHU QHDUE\ SURSHUWLHV DOVR UHSUHVHQW 7KLVLQWHUVHFWLRQIRUPVWKHQRUWKHUQPRVWOLPLWRIWKH UHGHYHORSPHQW RSSRUWXQLWLHV FUHDWLQJ DQRWKHU VWXG\DUHD,WLVKHDYLO\LPSDFWHGE\WKHSUHVHQFH QRGH ZKHUH UHGHYHORSPHQW DORQJ WKH OLQHV RI &KLOGUHQ·V +RVSLWDO %REE &KHYUROHW*HR &R RI PRGHVW LQWHUYHQWLRQV FRPSDUHG WR WKH DQGDVWULSFHQWHUWKDWXQWLOUHFHQWO\ZDVDQFKRUHG 6FKRWWHQVWHLQVVLWH UHKDELOLWDWLRQDQGVLWHFKDQJHV E\D.URJHU)RRGV,QWKHLPPHGLDWHDUHDRIWKLV ZRXOGKDYHVLJQLÀFDQWLPSDFWXSRQWKHIXQFWLRQ LQWHUVHFWLRQQHDUO\DOOWKHKLVWRULFVWUXFWXUHVKDYH RI WKH FRUULGRU DQG EHQHÀW WKH FRPPXQLW\  )RU EHHQ UHSODFHG HYHQ WKRXJKWKH FXUUHQW XVHV H[DPSOH KDYHEHHQLQSODFHIRUDORQJWLPH$WWKLVWLPH WKLVLQWHUVHFWLRQIRUPVWKHQRUWKHUQHQWU\LQWRWKH 3DUVRQV $YHQXH FRUULGRU DQG LW KDV JHQHUDWHG FRQFHUQDPRQJVRPHFRPPXQLW\PHPEHUVWKDW LWVKRXOGEHJLYHQD´*DWHZD\µIHDWXUH

 3DUVRQV 7KLV EXLOGLQJ LV ORFDWHG LPPHGLDWHO\ WR WKH VRXWK RI WKH FXUUHQW /LEUDU\ DGMDFHQWWR.RVVXWK6WUHHW,WLVFXUUHQWO\RIIHUHG IRU VDOH EXW FRPPXQLW\ PHPEHUV EHOLHYH WKH DVNLQJ SULFH PD\ EH XQUHDVRQDEO\ KLJK  $Q\ UHGHYHORSPHQW RI WKH VLWH VKRXOG EH FRQVLVWHQW ZLWK WKH 1HLJKERUKRRG &RPPHUFLDO 2YHUOD\ =RQLQJ 5HFHQW LQGLFDWLRQV DUH WKDW D IDVW IRRG HQWLW\LVH[SORULQJWKHVLWH

8SRQFRQVLGHUDWLRQVRIWKH/LEUDU\·VUHTXLUHPHQWV IRU D IXWXUH VLWH PHPEHUV RI WKH FRPPXQLW\ VXJJHVWHGWKHIROORZLQJVLWHVDVEHLQJSRWHQWLDOO\ JRRGDOWHUQDWLYHORFDWLRQVIRUWKH/LEUDU\VKRXOG LW SURFHHG ZLWK UHORFDWLRQ RI WKH 3DUVRQV $YH EUDQFK  7KHVH VLWHV UHSUHVHQW D VHW RI SRWHQWLDO .H\ $UHDV IRU UHGHYHORSPHQW DV WKHLU VXLWDELOLW\ %REE &KHYUROHW*HR &R  ( /LYLQJVWRQ LV IRU /LEUDU\ XVH ZRXOG PDNH WKHP DOVR VXLWDEOH KLJKOLJKWHGRQWKHPDSDERYH IRU RWKHU HQWHUSULVHV QHHGLQJVLPLODU VSDFH

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

&KLOGUHQ·V+RVSLWDODVSDUWRIDPDVVLYHUHEXLOGLQJ ZRUN LQGHSHQGHQWO\ DV VPDOO EXVLQHVVHV UDWKHU SODQLQWHQGVWRFRQVWUXFWDSDUNLQJJDUDJHRYHU WKDQDVSDUWRIODUJHVFDOHHPSOR\HUV HJDXWR DQDUHDWKDWLVQRZDVXUIDFHSDUNLQJORWRQWKH IDFWRULHV %\HPSOR\LQJVRPHRIWKHVDPHWRROV VRXWKHDVW RI WKH LQWHUVHFWLRQ  6RPH FRPPXQLW\ XVHGWRDWWUDFWODUJHVFDOHHPSOR\HUVWKH\ZHUH PHPEHUVVWURQJO\REMHFWWRWKHJDUDJHDQGKDYH VXFFHVVIXO LQ DWWUDFWLQJ QHZ UHVLGHQWV HPSOR\HG FDPSDLJQHG IRU UHWDLO RIÀFH RU FRPPHUFLDO WR LQWKHDUWV$UWLVWVDVDJURXSRIWHQWHQGWRQRW EH LQFRUSRUDWHG RQ JURXQG ÁRRU IDFLQJ 3DUVRQV EH KLJKO\ FRPSHQVDWHG DQG SURYHG DQ HDJHU $YHQXH  ([DPSOHV RI VXFK PL[LQJRI XVHV LQ D JURXS WR SXUFKDVH DQG UHQRYDWH ROGHU KRXVLQJ SDUNLQJVWUXFWXUHKDYHSURYLGHGRSSRUWXQLWLHVWR LQ 3DGXFDK·V QHLJKERUKRRGV DQG VR LQFHQWLYHV PDLQWDLQWKHUK\WKPRIDVWUHHWVFDSH WR UHLQIRUFH WKHVH DFWLYLWLHV ZHUH DOVR DUUDQJHG 3DGXFDK·VSURJUDPLQFOXGHG $IWHUFRQVLGHUDWLRQRIPDQ\IDFWRUVWKHFRQVXOWLQJ WHDP GHFLGHGWKDW LW ZRXOGQRW UHFRPPHQG ‡ ,QFHQWLYHVWRDWWUDFWWKH$UWLVWLF&RPPXQLW\ SXVKLQJ WKH +RVSLWDO WR LQFRUSRUDWH UHWDLO LQWR ‡ /RFDOEDQNVLQFHQWLYHOHQGLQJWRDUWLVWVEX\LQJ WKH VWUXFWXUH  ,W ZRXOG EH D JRRG WKLQJ WR GR  UHQRYDWLQJKRPHV EXWZHGRQRWIHHOWKDWLWZRXOGSURYLGHHQRXJK ‡ *URXSKHDOWKLQVXUDQFHSURYLGHGWKURXJKWKH EHQHÀWWRPDNHDVWURQJUHFRPPHQGDWLRQIRULW  .HQWXFN\$UWV&RXQFLO ,Q WKLV SDUWLFXODU VLWH WKH OLPLWHG DPRXQW RI QHZ ‡ -RLQW PDUNHWLQJ  SURPRWLRQV DW D QDWLRQDO UHWDLOVSDFHWKDWFDQEHDEVRUEHGLPPHGLDWHO\  OHYHOLQFOXGLQJIUHHZHESDJHV WKH ODUJH DPRXQW RI DYDLODEOH VSDFH RQ WKH ‡ 3UHVHUYDWLRQWD[FUHGLWV ORFDO $YHQXH WKH ORFDWLRQ RI WKH SURSRVHG JDUDJH ‡ (QWHUSULVH=RQHWD[LQFHQWLYHV DW WKH QRUWKHUQPRVW HGJH RI WKH VWXG\ DUHD ‡ %XVLQHVV DVVLVWDQFH HJ  EXVLQHVV SODQV DQG &KLOGUHQ·V VWDWHG ZLOOLQJQHVV WR LQFRUSRUDWH  ÀQDQFHDQGEXVLQHVVORDQV GHVLJQIHDWXUHVLQWRWKHIDFDGHVRIWKHVWUXFWXUH DOOFRQWULEXWHGWRRXUGHFLVLRQWRQRWPDNHWKLVD UHFRPPHQGDWLRQRIWKH9LVLRQ3ODQ,QDGGLWLRQ &KLOGUHQ·V SRLQWV RXW WKDW WKH\ GR QRW ZDQW WR H[SHQG WKHLU WLPH DQG HQHUJ\ LQ FRPPHUFLDO SURSHUW\PDQDJHPHQW3ODQQLQJIRUFRQVWUXFWLRQ LVXQGHUZD\DQGLWLVEHLQJGHVLJQHGZLWKSRVVLEOH H[SDQVLRQLQPLQG7KH+RVSLWDOKDVLQGLFDWHGD ZLOOLQJQHVV WR UHFRQVLGHU WKH LVVXH LI LW EHFRPHV SUXGHQWWRH[SDQGWKHJDUDJH,IWKHFRPPXQLW\ FDQÀQGDZD\EHFRPHOHVVDGYHUVDULDOZLWKWKH +RVSLWDO DQG EHJLQ WR DFFHSW WKH +RVSLWDO DV D SDUWQHU WKH\ PD\ EH DEOH WR ZRUNWRJHWKHU RQ LPSRUWDQWSURJUDPVDQGSURMHFWVLQWKHIXWXUH 0XVLFLDQSOD\DWDUHQRYDWHGKRXVHFRQYHUWHGWR DFDIp $"4&
456%*&4 7KHVWXG\ORRNHGWRRWKHUFRPPXQLWLHVWKDWKDYH HPEDUNHG RQ UHYLWDOL]DWLRQ SURMHFWV WR H[SORUH VWUDWHJLHVDQGOHVVRQVWKDWZRXOGEHDSSOLFDEOHWR 3DUVRQV$YHQXH7KHIROORZLQJH[DPSOHVVHHPHG WRKDYHSDUWLFXODUVLPLODULWLHVWR3DUVRQV$YHQXH

3DGXFDK$UWLVW´5HORFDWLRQµ3URJUDP 3DGXFDK.HQWXFN\VHWRXWWRUHYLWDOL]HLWVKLVWRULF QHLJKERUKRRGV DQG FRPPHUFLDO GLVWULFWV  7KH UHJLRQDURXQGWKHPRIIHUHGH[FHSWLRQDOQDWXUDO DPHQLWLHV ERWK VFHQLF DQG RXWGRRU UHFUHDWLRQ 6HQVLQJWKDWWKHVHDPHQLWLHVZRXOGEHDWWUDFWLYH WR DUWLVWLF \RXQJHU SHRSOH WKH\ LGHQWLÀHG DUWLVWV DV DQ LQGXVWU\ QLFKH WR WU\ WR DWWUDFW WR WKHLU WRZQ  $UWLVWV DQG WKHLU JDOOHULHV DOVR SURYLGH +LVWRULFJDVROLQHVWDWLRQUHQRYDWHGDQGUHXVHGDV DQRWKHU DWWUDFWLRQ IRU WRXULVP $UWLVWV KRZHYHU DFDQGOHVKRSUHWDLQVLWVRULJLQDOFKDUDFWHU

1BHF
" ,QGLDQDSROLV ,QGLDQDSROLV FUHDWHG D VHW RI SURJUDPV WKDW DUH DYDLODEOH LQ WDQGHP LQ DOO WKHLU KLVWRULF QHLJKERUKRRGVDQGKLVWRULFFRPPHUFLDOGLVWULFWV )/,3VSRQVRUHGE\WKH,QGLDQD+LVWRULF/DQGPDUNV SURYLGHV IXQGLQJ IRU UHQRYDWLRQV RI KLVWRULF SURSHUWLHVLQFOXGLQJKRXVLQJ

)2&86SURJUDP ‡ 7KH ORFDO QHLJKERUKRRGV KDYH ORFDO  &RPPXQLW\'HYHORSPHQW&RUSRUDWLRQV ‡  &RPPHUFLDO &RUULGRU &RQVRUWLXPV  1HLJKERUKRRGVHDFK 7KH (QULFK %XLOGLQJ  RI DGDSWLYH UHXVH ‡ +LUHG&RPPHUFLDO&RUULGRU3URMHFW0DQDJHUV OHDVHGWRDQXPEHURIXVHUVRIÀFHVZDUHKRXVLQJ ‡ 3DUWQHUVKLSV DQG ÀQDQFLDO VXSSRUW ZLWK WKH DWUDLQLQJFHQWHUVPDOOEXVLQHVVHVDQGQRQSURÀWV  /RFDO,QLWLDWLYHV6XSSRUW&RUS /,6& ‡ )DoDGH,PSURYHPHQW5HEDWH3URJUDPXSWR  RIFRVW

1RWH /,6&DOVRSURYLGHVWUDLQLQJIRU&'&·V  *UDQWVWKDWZHUHXVHGE\&'&FRQVRUWLXPV  WRKLUH&RUULGRU3URMHFW0DQDJHUV :LOODOVRIXQGUHKDESURMHFWVWKDWLQYROYH  RQO\KRXVLQJ

WK6WUHHW7KLVFRPPHUFLDOFRUULGRULVEXLOWRQD KLVWRULF QHLJKERUKRRG DQG OLQNV WKH KRVSLWDO DW RQHH[WUHPHWRWKH,QGLDQDSROLV0RWRU6SHHGZD\ DWWKHRWKHU$WRWDOPL[WXUHRIFRPPHUFLDOXVHV QRZDOVRLQFOXGHSDUNVJURFHUVDQGUHVWDXUDQWV

$UW63$&(86$3URMHFWV +RRVLHU )ODWV 5HVWRUDWLRQ RI  6) YDFDQW ÀUVW $UW63$&( LV WKH OHDGLQJ QRQ SURÀW UHDO HVWDWH ÁRRUUHWDLOVSDFHVUHVLGHQWLDOXQLWVDERYH7KH GHYHORSHU IRU WKH DUWV  7KH\ ZRUN DFURVV WKH 'DYLDQEXLOGLQJQH[WGRRUZDVDPLOOLRQPL[HG FRXQWU\E\IRUPLQJSDUWQHUVKLSVZLWKORFDOOHQGHUV XVHEXLOGLQJ7RJHWKHUWKH\FUHDWHDPDVVLQJWKDW GHYHORSPHQWDJHQFLHVDQGRWKHUUHVRXUFHV VWLPXODWHVPRUHDFWLYLW\ ‡ $OVRSURYLGHFRQVXOWLQJVHUYLFHVDQGSURSHUW\  PDQDJHPHQW

*HQHVLV 3OD]D +HDOWK &HQWHU  6) RI QHZ EXLOGPHGLFDORIÀFHVZKLFKLVDOVRKRPHWRWKH ORFDO&'&

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

(YHUHWW 6WDWLRQ /RIWV 3RUWODQG 2UHJRQ 7KLV (ULF*URKH0XUDOV DFTXLVLWLRQUHKDESURMHFWGHYHORSHGORIWVIRU %XF\UXV 6WHXEHQYLOOH OLYHZRUNVSDFHDQGZLWKWKHUHWDLOEHORZFRQWDLQV  6) FRVWLQJ  PLOOLRQ DYHUDJH KRXVLQJ FRVWRI 

(OGHU6WUHHW )RUPHU-DFNVRQ+RVSLWDO LQ+RXVWRQ 7H[DV²7KLV6)SURMHFW\LHOGHGOLYHZRUN XQLWVIRUDWRWDOLQYHVWPHQWRIPLOOLRQ  SHUXQLW 

2.&2NODKRPD&LW\ ,QWKHHDUO\·VWKHZKROHFLW\RI2NODKRPD ‡ 2.,QWHUQDWLRQDO)LOP&RXQFLO ‡ ,QWHUQDWLRQDO0$'$$XWR6KRZ (ULF*URKH0XUDOVH[DPSOHVRIPXUDOVLQVWDOOHGDV ‡ 6WDUWHG ZLWK /3 RI WHQDQWV ZKR RFFXSLHG D SXEOLFDUWLQFRQMXQFWLRQZLWKDVPDOOSXEOLFSOD]D EXLOGLQJLQWKHGLVWULFW IRU JDWKHULQJV DQG RXWGRRU HQWHUWDLQPHQW  7KLV ‡ 0$36SURMHFWVWRWDO0LOOLRQVLQFH·V SURMHFW UHFHLYHG ZLGHVSUHDG VXSSRUW DQG ZDV IXQGHGWKURXJKGRQDWLRQV,WQRZVHUYHVDVDIR FDOSRLQWIRUWKHFRPPXQLW\

1BHF
" -0$"-
&9".1-&4 7KH:LQGHUV%XLOGLQJ²6KRUW1RUWK 7KLV LV D JRRG H[DPSOH RI UHXVH DQG UHVWRUDWLRQ %HHFKZROG3ODFH RI D KLVWRULF FRPPHUFLDO VWUXFWXUH  )RUWXQDWHO\ PRVW RIWKHKLVWRULF VWUXFWXUDO HOHPHQWVZHUH VWLOO LQ SODFH UHTXLULQJ RQO\ WKH UHRSHQLQJRI WKH ZLQGRZGLVSOD\DUHDV

&OLQWRQYLOOH´6XQRFR6WDWLRQµ $QDEDQGRQHGJDVROLQHVWDWLRQZDVGHPROLVKHG 7KHUHGHYHORSPHQWRIWKHVLWHSURYLGHGDVHULHVRI UHWDLOEXLOGLQJVEXLOW´WRWKHVWUHHWµDQGLQDVW\OH V\PSDWKHWLF WR WKH SHULRG DUFKLWHFWXUH RI WKH QHLJKERUKRRG  7KLV LV DQ H[FHOOHQW LOOXVWUDWLRQ RI WKHVSLULWRIWKH8UEDQ'HVLJQ2YHUOD\VWDQGDUGV

7ZRXQVLJKWO\EXLOGLQJVZHUHGHPROLVKHGDJJUHJDWLQJ WKUHH SDUFHOV  7KH UHGHYHORSPHQW UHFRQÀJXUHG D UHWDLOSOD]DZLWKRQVLWHSDUNLQJDQGRSHQLQJXSYLVWDV WRWKHFKXUFKRQWKHQH[WEORFN7KLVH[DPSOHVKRZV DZD\WRVHQVLWLYHO\UHGHYHORSPRGHVWVL]HVLWHVDQG LQFRUSRUDWHPRGHUQSDUNLQJQHHGV

7UHH7RSV²%UHZHU\'LVWULFW

7KLV H[DPSOH VKRZV WKDW PL[WXUHV RI KRXVLQJ DQG FRPPHUFLDOFDQH[LVWWRJHWKHURQDFRUULGRU6KRZQ LVDGHYHORSPHQWFRQVLVWLQJRIUHVWRUDWLRQRIH[LVWLQJ KRXVHVDQGWKHXVHRILQÀOO7KHQHZFRQVWUXFWLRQXVHV DUFKLWHFWXUHWKDWFRPSOHPHQWVWKHH[LVWLQJRQHDFK VLGH8QVHHQLQWKLVYLHZLVWKHODUJHUFRQGRPLQLXP VWUXFWXUHWKDWZLOOEHFRQVWUXFWHGEHKLQG

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

."3,&5
456%:
46.."3: 9LVLELOLW\DQG$FFHVV 9HKLFXODU DFFHVV WR WKH VWXG\ DUHD LV FRQVLGHUHG &21&/86,216$1'5(&200(1'$7,216 H[FHOOHQWIURPWKHQRUWKLQFOXGLQJKLJKO\GHYHORSHG 7KH IROORZLQJ FRQFOXVLRQV DQG UHFRPPHQGDWLRQV QHLJKERUKRRGV RI GRZQWRZQ DQG WKH QHDU HDVW DUHEDVHGXSRQDQLQGHSWKH[DPLQDWLRQRIKRXVLQJ VLGH DV ZHOO DV IURP DUHDV WR WKH VRXWK 7UDIÀF RQ UHWDLOFRPPHUFLDO LQGXVWULDO DQG LQVWLWXWLRQDO XVHV 3DUVRQV $YHQXH LV FRQVLGHUHG KHDY\ IRU WKH H[LVWLQJ ZLWKLQ WKH VWXG\ DUHD DQG DQ DQDO\VLV RI &HQVXV LQIUDVWUXFWXUH7ZR RI3DUVRQV$YHQXH·V IRXU ODQHV EDVHG GHPRJUDSKLF DQG HFRQRPLF WUHQGV 2XU DUH XVHG IRU SDUNLQJ DW DOO EXW WKH EXVLHVW WLPHV RI FRQFOXVLRQVDQGUHFRPPHQGDWLRQVDUHDOVREDVHG WKHGD\,PSURYHGVWUHHWGHVLJQVWRFDOPWUDIÀFÁ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´IRUJRWWHQµ DPRQJ RWKHU FLW\ RI &ROXPEXV ZHVW RI WKH VWXG\ DUHD ,Q RXU RSLQLRQ WKH DUHD KDV DUHDV KDV SHUYDGHG WKH GLDORJXH RIDYDULHW\ JUHDWSRWHQWLDOWRGUDZPRUHSHGHVWULDQVYLDVLGHZDON RI UHVSRQGHQWV GXULQJ WKH UHVHDUFK SURFHVV DQG IDoDGH LPSURYHPHQWV DQG GHYHORSPHQW RI &RQYHUVHO\ QHLJKERUKRRG UHVLGHQWV KDYH D QHLJKERUKRRGVFDOHUHWDLOGHVWLQDWLRQVSDUWLFXODUO\LQ VWURQJ VHQVH RISULGH LQ WKH DUHD·V KLVWRU\ SDVW WKHQRUWKHUQSRUWLRQRIWKHVWXG\DUHD DQGSUHVHQWLQKDELWDQWVDQGJHQHUDODWWLWXGH $OWKRXJK ORFDWHG MXVW VRXWKHDVW RI WKH &ROXPEXV 7KH 9LVLRQ 3ODQ ZLOO DPSOLI\ WKH SRVLWLYH DVSHFWV &HQWUDO %XVLQHVV 'LVWULFW WKH VWXG\ DUHD VXIIHUV IURP RI WKH DUHD IURP D ODQGXVH SODQQLQJ VWDQGSRLQW DGLVWLQFWODFNRIYLVLELOLW\/DUJHVFDOHODQGXVHV´FXW 7KHVH DVSHFWV LQFOXGH ZDONDEOH QHLJKERUKRRGV RIIµ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

5HFRPPHQGDWLRQV IRU LQFUHDVLQJ SRVLWLYH $OWKRXJKVLJQVDQQRXQFLQJHQWU\LQWRWKH´6RXWK6LGHµ SHUFHSWLRQVRIWKHDUHDLQFOXGH DUHFXUUHQWO\SODFHGDWWKHQRUWKDQGVRXWKHQWUDQFHV WRWKHVWXG\DUHDLWLVRXURSLQLRQWKDWPRUHDJJUHVVLYH ‡ ,QÁXHQFHSXEOLFSHUFHSWLRQVYLDQHZV DHVWKHWLFDOO\SOHDVLQJVLJQDJHRUPDUNHUVDUHQHHGHG  FRYHUDJHRIUHGHYHORSPHQW DWERWKWKHQRUWKHUQDQGVRXWKHUQHQGVRIWKHFRUULGRU ‡ 3XEOLVK)%,&ULPH,QGLFHVWKDWLOOXVWUDWHWKH $GHÀQLQJVWUXFWXUHVXFKDODUJHPXUDODQDUFKQHZ  FRPSDUDELOLW\RI3DUVRQV$YHQXHFULPH OLJKWLQJ ODQGVFDSLQJ RU ODQGPDUN ZRXOG HQKDQFH  LQGLFHVWRWKHRWKHUFLW\DUHDV YLVLELOLW\ )XUWKHU VLJQDJH PLJKW LQFOXGH ODQJXDJH ‡ (QFRXUDJHEORFNZDWFKQHWZRUNVDQG ZHOFRPLQJYLVLWRUVWR3DUVRQV$YHQXHUDWKHUWKDQWKH  LQIRUPDWLRQVKDULQJ PRUHJHQHUDOVRXQGLQJ´6RXWK6LGHµ ‡ ,QGLFDWH&KLOGUHQ·V+RVSLWDODVWKH´HQWU\  SRLQWµWRWKH3DUVRQV$YHQXHFRUULGRU $V WKH FLW\ JURZV FORVHU WR UHFRQÀJXUDWLRQ RI ‡ 3URPRWHSRVLWLYHO\WKDWWZRGHYHORSPHQWVLQ WKH LQWHUFKDQJH RI ,QWHUVWDWHV  DQG  LW LV RXU  WKHQRUWKHUQSRUWLRQRIWKHFRUULGRUDUH UHFRPPHQGDWLRQWKDWFRQVLGHUDWLRQVKRXOGEHWDNHQ  SODQQHGLQFOXGLQJDQHZ&KLOGUHQ·V+RVSLWDO IRU PDNLQJ LPSURYHPHQWV WR WKH GRZQWRZQHDVW  SDUNLQJJDUDJHDQGD6XEZD\UHVWDXUDQW VLGH DQG VRXWK VLGH QHLJKERUKRRGV WKDW LW DIIHFWV ‡ &UHDWHDFRRSHUDWLYHSDUWQHUVKLSEHWZHHQ $GGLWLRQDO DFFHVV SRLQWV WKDW ZRXOG FRQQHFW WKH QHLJKERUKRRGJURXSVDQG3DUVRQV$YHQXH VLWHGLUHFWO\ZLWKGRZQWRZQZLOOEHLPSDFWHGE\WKH  0HUFKDQWV$VVRFLDWLRQ 3$0$  ,QWHUVWDWHUHDOLJQPHQWZKLFKLVVWLOOXQGHUGHVLJQ  QHLJKERUKRRGVFKRROVDQG&KLOGUHQ·V+RVSLWDO UHYLHZDQGGXHWREHJLQFRQVWUXFWLRQLQ)XUWKHU ‡ ,QYLWHWKHFRPPXQLW\WRH[SHULHQFHDYDULHW\ WKLV UHFRQÀJXUDWLRQ ZLOO KDYH WKH DGGHG LPSDFW RI  RIDIIRUGDEOHUHWDLODQGUHVWDXUDQWFKRLFHV JHQHUDWLQJFRQVWUXFWLRQQRLVHDQGOLJKWSROOXWLRQIRU ‡ ,QIRUPYLVLWRUVDERXWWKHDUHD·VULFKKLVWRU\ DEULHISHULRG 1BHF
" ,QÀOO SURSHUWLHV KDYH UHSODFHG PDQ\ KLVWRULF 5(7$,/&200(5&,$/0$5.(76800$5< VWUXFWXUHVZLWKLQWKHVWXG\DUHD7KLVPL[WXUHRIROG DQG QHZ EXLOGLQJV GHVLJQ VWDQGDUGV DQG QRQ 6WUHQJWKV FRPSDWLEOHOHYHOVRITXDOLW\GLOXWHVWKHDWWUDFWLRQ ‡ 7UDGLWLRQDVUHWDLOFRUULGRUEDVHRIVXFFHVVIXO RI D IHZ DHVWKHWLFDOO\ RXWVWDQGLQJ KLVWRULF DQG H[LVWLQJUHWDLOHUV DUFKLWHFWXUDO VWUXFWXUHV7KHUHIRUHWKH FUHDWLRQ ‡ 5HODWLYHO\ KLJK WUDIÀF FRXQWV IRU RI D KLJKO\ DWWUDFWLYH UHWDLO FOXVWHU ZRXOG LQ RXU QHLJKERUKRRGUHWDLO RSLQLRQ LQFUHDVH YLVLELOLW\ DURXQG WKH QRUWKHUQ ‡ 3RWHQWLDOWRVXSSRUWVRPHQLFKHUHWDLODVZHOO HQWUDQFHWRWKHVWXG\DUHD  DVQHLJKERUKRRGUHWDLO ‡ 3RWHQWLDO WR FDSWXUH EXVLQHVV IURP GD\WLPH $GGLWLRQDO FRPPHQWV RQ YLVLELOLW\ DQG DFFHVV  ZRUNHUV LQ WKH LPPHGLDWH QRUWK DQG FHQWUDO LQFOXGH  DUHDV ‡ 3RWHQWLDO IRU GHYHORSPHQW RI VPDOOVSDFH ‡ 7KH &KLOGUHQ·V +RVSLWDO SDUNLQJ JDUDJH LV DQ GLQLQJ HVWDEOLVKPHQWV ZLWK ORZ RYHUKHDG  DWWUDFWLYH VWUXFWXUHWKDW UHÁHFWVWKDW  LQVWLWXWLRQ·VQHHGIRUPRUHSDUNLQJ%\ZRUNLQJ &KDOOHQJHV  ZLWK&KLOGUHQ·V+RVSLWDODUHDPHUFKDQWVFDQ ‡ /DFNRIYLVLELOLW\ LPH EHQHÀW IURP SUR[LPLW\ WR WKLV  RYHU W ‡ ,QFRQVLVWHQWDUFKLWHFWXUDOO\VWUHHWVFDSHV  LQVWLWXWLRQ UDWKHU WKDQ KDYH LWV ORFDWLRQ VHUYH ‡ 0DUNHWLQJ FKDOOHQJHSRRU UHSXWDWLRQ ZLWK  DV D GHWULPHQW RU LQIULQJHPHQW RI WKH  XQFHUWDLQSRWHQWLDOVXSSRUWEDVH  FRQWLQXXPRIQHLJKERUKRRGOHYHOUHWDLO ‡ /LPLWHG FDSDFLW\ WR VXSSRUW FRQVLVWHQW  PDUNHWV RWKHU WKDQ QHLJKERUKRRG UHWDLO ‡ 3$0$·V´:HOFRPHWRWKH6RXWKVLGHµDQGWK  EHFDXVHRISDUNLQJDQGDFFHVVLVVXHV  &HQWXU\9HWHUDQV0HPRULDOVFDOOIRUFRPPXQLW\ ‡ ,QJUHVVHJUHVV IURP H[LVWLQJ SDUNLQJ DUHDV LV JRLQJPDLQWHQDQFH7KHLU  VXSSRUWDVZHOODVRQ  GLIÀFXOW  SXUSRVHLVWRSURYLGHD´SRFNHWSDUNµVHWWLQJ IRFDOSRLQWQHDUWKHHQWUDQFHWRWKHVWXG\  DQG 5HWDLO&RPPHUFLDO  DUHD 0DQ\GLIIHUHQW W\SHV RI UHWDLO DQG VHUYLFH EXVLQHVVHVFDQEHIRXQGDORQJ3DUVRQV$YHQXH LQJLQJ EXLOGLQJV EDFN XS WR WKH VWUHHW YLD ‡ %U EXW WKH XQHYHQ VWUHHWVFDSH LQFOXGHV QHJOHFWHG  HQIRUFHPHQWRIWKHXUEDQFRPPHUFLDORYHUOD\ IDFDGHV DQG YDFDQW ÀUVWÁRRU EXVLQHVVHV 0DQ\ S WR UHVWRUH WKH KLVWRULF  ZLOO RYHU WLPH KHO EXLOGLQJV ZLWK ]HUR VHWEDFNV DUH PL[HG ZLWK IWKHFRUULGRUDQGLQFUHDVHSHGHVWULDQ  QDWXUHR QHZHUEXLOGLQJVZLWKSDUNLQJORWVLQIURQWRIWKHP  WUDIÀFLQWKHVWXG\DUHD %XVLQHVVHVPL[ZLWKVLQJOHIDPLO\UHVLGHQFHVLQIDLU WRSRRUFRQGLWLRQ ‡ ,PSOHPHQWDWLRQ RI WUDIÀF FDOPLQJ PHDVXUHV  ZLOOLPSURYHWKHSHGHVWULDQH[SHULHQFHRIWKH :KLOHWKLVVWUHHWVFDSHODFNVFRQWLQXLW\LWVDQFKRUV  FRUULGRULQWHUPVRIDHVWKHWLFVDQGVDIHW\7KHVH .URJHU 7HH -D\H·V &96 3KDUPDF\ DQG 3ODQNV  PHDVXUHVZLOODOVRVHUYHWRFUHDWHD´IULHQGOLHUµ SHUIRUPZHOODQGUHSUHVHQWSRWHQWLDOIRUJURZWKRI JKERUKRRGVFDOHFOLPDWH  PRUHQHL QHZUHWDLOLQFOXVWHUVDURXQGWKHP

7KHFRUULGRUFRQWDLQVDQLPEDODQFHGQXPEHURI EDUV SDZQVKRSV XVHG IXUQLWXUH DQG DSSOLDQFH VWRUHV VWRUHIURQW FKXUFKHV DQG XVHG FDU ORWV +RZHYHU SRWHQWLDO H[LVWV IRU GHYHORSPHQW RI DGGLWLRQDOWKULIWVWRUHVLIWKH\DUHZHOOPDQDJHG DQGKDYHHFOHFWLFDWWUDFWLYHRIIHULQJV

7KHFRUULGRUOLQNVPDQ\HPHUJLQJQHLJKERUKRRGV DQGWKHVHQHLJKERUKRRGVFRQWDLQLQGLYLGXDOVDQG FLYLF JURXSV HDJHU WR GHFUHDVH FULPH LPSURYH KRXVLQJ DQG VFKRROV DQG SUHVHUYH WKH VHQVH RI KLVWRU\DQGFXOWXUHWKDWWKHDUHDKROGV7KHJURZWK RIFLYLFLQYROYHPHQWRIVXUURXQGLQJQHLJKERUKRRGV LVDYHU\SRVLWLYHLQGLFDWRURIJURZLQJSRWHQWLDOIRU VXFFHVVIXOUHGHYHORSPHQWHIIRUWV

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

%DVHG XSRQ RXU GHPRJUDSKLF DQG HFRQRPLF 2WKHURSSRUWXQLWLHVIRUFXVWRPHUVHUYLFHRUEDFN DQDO\VLVRIWKH1HDU6RXWKVXEPDUNHWÀHOGVXUYH\RI RIÀFH ZRUN FRXOG EH IRXQG ZLWKLQ WKH JURZLQJ UHWDLOVSDFHDQGLQWHUYLHZVZLWKSURMHFWVWDNHKROGHUV &KLOGUHQ·V+RVSLWDORU2KLR6WDWH8QLYHUVLW\+RVSLWDO LW LV RXU RSLQLRQ WKDW UHWDLO GHYHORSHG ZLWKLQ WKH QHWZRUN 3DUVRQV$YHQXHFRUULGRUVKRXOGEHJLQWRVROLGLI\UHWDLO DQG FRPPHUFLDO QRGHV DW VWUDWHJLF SRLQWV DORQJ &HQWUDOFOXVWHUVFDWWHUHGVLWHVLQFOXGLQJ &0$&$2 %XLOGLQJ 6RXWKHDVW SRUWLRQ RI 3DUVRQV WKHFRUULGRUWDNLQJDGYDQWDJHRIDYDLODEOHH[LVWLQJ DQG5HLQKDUG VSDFHDVZHOODVFXUUHQWO\YDFDQWODQG'HYHORSPHQW RU UHGHYHORSPHQW RU UHWDLO VKRXOG SURYLGH D  3DUVRQV $YHQXH )RUVDOH XVHG DXWRPRELOH

QHLJKERUKRRGVFDOHFRQWLQXXPRIDUFKLWHFWXUHDQG ORW UHWDLORIIHULQJVIURPWKHGRZQWRZQDQGVXUURXQGLQJ UHWDLO VWULSV FDWHULQJ WR QHLJKERUKRRG UHVLGHQWV 7KHUHGHYHORSPHQWRIDSSUR[LPDWHO\RQHPLOOLRQ FRPPXWHUVDQGGD\WLPHZRUNHUV VTXDUHIHHWRIPDQXIDFWXULQJDQGRIÀFHVSDFHDW 7HFK&HQWHU6RXWKLVH[SHFWHGWREULQJWR 7KHIROORZLQJDUHUHFRPPHQGDWLRQVIRUGHYHORSPHQW MREVWRWKHIRUPHU7HFKQHJODVVLWHLQWKHFHQWHURI RIVSHFLÀF DUHDV RI WKH FRUULGRU DV ZHOO DV PRUH WKHVWXG\DUHD7KHIROORZLQJXVHVDUHVXJJHVWHG JHQHUDO UHFRPPHQGDWLRQV FRQFHUQLQJ QHZ UHWDLO IRUWKLVSRUWLRQRIWKHFRUULGRU DQGFRPPHUFLDOGHYHORSPHQW ‡ )DVWFDVXDOUHVWDXUDQWFKDLQ ‡ %DUEHFXHFDUU\RXW 6RXWKHUQ FOXVWHU IRUPHU 6FKRWWHQVWHLQV VLWH DQG ‡ %DNHU\FRIIHHVKRS VXUURXQGLQJYDFDQWSDUFHOV ‡ %DQNLQJNLRVNZLWK$70 ‡ (WKQLFIRRGVDOHVFDUU\RXW 7KH VLWH UHÁHFWV SRWHQWLDO IRU FUHDWLRQ RID VPDOO QHRWUDGLWLRQDO GHYHORSPHQW WKDW ZRXOG *URZWK RI QHZ UHWDLO RQ 3DUVRQV $YHQXH ZLWKLQ LQFRUSRUDWHKRXVLQJZLWKUHWDLOFRPPHUFLDODQG WKHVXJJHVWHGVLWHVLVEDVHGXSRQWKHIROORZLQJ LQVWLWXWLRQDOXVHVWKDWZRXOGDQFKRUWKHVRXWKHUQ ‡ $YDLODELOLW\RIKLJKTXDOLW\UHWDLOVSDFH SRUWLRQ RI WKH VWXG\ DUHD 7KLV VSDFH ZRXOG LQ ‡ 6\QHUJ\ZLWKWKHSRSXODU.URJHUJURFHU\VWRUH RXU RSLQLRQ UHTXLUH WKH JUHDWHVW VXEVLGLHV DQG ‡ 2SSRUWXQLW\WRGUDZZRUNHUVZLWKRXWQHHGIRU ZRXOG EH VXEVLGL]HG DFFRUGLQJ WR XVHU 7KLV  DGGLWLRQDOSDUNLQJ FRXOG LQFOXGH WD[ LQFHQWLYHV DIIRUGDEOH OHDVH ‡ 2SSRUWXQLW\WRGUDZVXSSRUWIURPKRXVHKROGV DJUHHPHQWVDQGSURÀWJXDUDQWHHV7KHIROORZLQJ  LQ FHQWUDO DQG VRXWKHUQ QHLJKERUKRRGV RI FRUULGRU XVHVDUHUHFRPPHQGHGIRUWKHVLWH 

‡ 6PDOO WR PHGLXP VFDOH GLVFRXQW UHWDLOHU &XUUHQW3DUVRQV$YHQXH/LEUDU\6LWHDQGDGMDFHQW YDFDQWVLWHWRWKHVRXWK  0DUF·VVTXDUHIHHWSOXVSDUNLQJ ‡ &DOOFHQWHURURWKHURIILFHXVHU VTXDUHIHHW ‡ &RPSXWHUWUDLQLQJFHQWHU VTXDUHIHHW 7KHQRUWKHUQSRUWLRQRIWKHFRUULGRUKDVWKHJUHDWHVW ‡ %XVLQHVV LQFXEDWRU LQ SDUWQHUVKLS ZLWK 268 SRWHQWLDO IRU XQVXEVLGL]HG UHWDLOFRPPHUFLDO UHGHYHORSPHQW DQG LQÀOO FRQVWUXFWLRQ 7KLV LV  5LFNHQEDFNHU 6PDOO %XVLQHVV 'HYHORSPHQW J  &RXQFLO VTXDUHIHHW EDVHGXSRQWKHFRQFOXVLRQVWKDWWKHVXUURXQGLQ ‡ )OH[LEOH VSDFH ZLWK JDOOHU\ VDOHV DUHDV IRU QHLJKERUKRRGV KDYH WKH PRVW H[SHQGDEOH LQFRPH HFOHFWLF VSHQGLQJ SDWWHUQV DQG KDYH  V\QHUJ\ZLWK)DUPHU·V0DUNHW VTXDUHIHHW ‡ 3RVVLEOH DIIRUGDEOH VHQLRU KRXVLQJ SDUFHOV XSZDUGHFRQRPLFPRELOLW\7KHVHQHLJKERUKRRGV DUH FRPSULVHG RI KLJKHULQFRPH RZQHU DQG  ZHVWRI3DUVRQV  VTXDUHIHHW ‡ &27$7UDQVSRUWDWLRQKXEIRU5LFNHQEDFNHUZRUNHUV UHQWHURFFXSLHG KRXVHKROGV $ SRUWLRQ RIGULYH E\WUDIÀFFDQDOVREHH[SHFWHG)XUWKHUVXSSRUW *LYHQ WKH VLWH·V SUR[LPLW\ WR 5LFNHQEDFNHU ZH FRXOG EH FXOWLYDWHG DPRQJ WKH KXQGUHGV RI H[SHFWWKDWWKHVLWHFRXOGEHPDUNHWHGWRDWWUDFW GD\WLPHZRUNHUVZKRZLOOXVHWKHSDUNLQJJDUDJH DFDOOFHQWHUXVHUWKDWDOUHDG\KDVDSUHVHQFHLQ SODQQHGIRU&KLOGUHQ·V+RVSLWDOHPSOR\HHV5HWDLO VKRXOG EH JHDUHG WRZDUG WKH UHODWLYHO\ GLYHUVH &HQWUDO2KLRRULVVHHNLQJWRHVWDEOLVKDSUHVHQFH IWKHVHJURXSVZLWKIRRGRIIHULQJVIRFXVLQJ KHUH JLYHQ WKH LQFUHDVHG HIÀFLHQF\ WKDW WKH QHHGVR LQWHUPRGDO WUDQVSRUW IDFLOLW\ SURPLVHV 6HYHUDO VRPHZKDWPRUHKHDYLO\RQ´RQWKHJRµ7KLVGRHV \LPSO\IDVWIRRGKRZHYHULWLVRXU QDWLRQDO UHWDLO FKDLQV FXUUHQWO\ KDYH GLVWULEXWLRQ QRWQHFHVVDULO FHQWHUVLQWKH&ROXPEXVDUHD7KHVHUHWDLOHUVLQFOXGH RSLQLRQWKDWWKDWFRQFHSWZRXOGZRUNZLOOZLWKLQ 7DUJHW :HVW-HIIHUVRQ 7KH/LPLWHG%LJ/RWV3LHU WKHQRUWKHUQSRUWLRQRIWKHFRUULGRU 2QH -& 3HQQH\ 9DOXH &LW\ *DS *URYHSRUW  'ROODU*HQHUDO =DQHVYLOOH DQG6SLHJHO*URXS 1BHF
" 6XJJHVWHGXVHVLQFOXGH ,W LV RXU RSLQLRQ WKDW D YDULHW\RI UHVWDXUDQWV ‡%DNHU\FRIIHHVKRS KDLU FDUH DQG RWKHU SHUVRQDO VHUYLFHV UHWDLO ‡6DQGZLFKVKRS'HOLFDUU\RXW W\SHV HPSKDVL]LQJ RQ FRQYHQLHQFH TXDOLW\ ‡6SHFLDOW\IRRGVWRUH DQG DIIRUGDELOLW\ VKRXOG ÀQG UHFHSWLYH PDUNHWV ‡)OH[LEOHVHFRQGVWRU\RIÀFHVSDFH DW WKH VXEMHFW SURMHFW :H DOVR H[SHFW WKDW LI ‡&RPSXWHUUHSDLUVKRS SURYLGHG ZLWK D JHQHURXV LQFHQWLYH SDFNDJH ‡(WKQLFUHVWDXUDQW WKH ODUJHU JHQHUDO PHUFKDQGLVHU FRXOG GHYHORS ‡+DLUFDUHQDLOV VWURQJ VXSSRUW ZLWK UHVLGHQWV RI VXUURXQGLQJ ‡'U\FOHDQHU QHLJKERUKRRGV ‡%DQNLQJNLRVNZLWK$70 2IFRXUVHWKHUDWLRRIVSHFLDOW\VWRUHVVKRXOGQRWWLS 8WLOL]H DYDLODEOH SURSHUWLHV IRU GHYHORSPHQW RI WKHFRUHUHWDLOEDODQFHDZD\IURPQHLJKERUKRRG QHZVPDOOWRPHGLXPVFDOHUHWDLOVSDFHV QHFHVVLWLHV .HHSLQJ LQ PLQG WKDW DW WKH FRUH RI LPSURYHPHQWV WR 3DUVRQV $YHQXH LV PDLQWDLQLQJ 7KH LQWURGXFWLRQ RI D VPDOOWRPHGLXP VL]HG KLJKO\ ZDONDEOH QHLJKERUKRRGV WKH UHWDLO PL[ JHQHUDO UHWDLOHU GUXJ VWRUHSKDUPDF\ RU RWKHU VKRXOG EH GHVLJQHG RQ D QHLJKERUKRRG VFDOH ´JHQHUDO UHWDLOµ XVHU ZRXOG VHUYH WR FRQVROLGDWH 5HWDLO RIIHULQJV VKRXOG EH DIIRUGDEOH WR PDQ\ VRPHRIWKHODUJHUYDFDQWUHWDLOVSDFHVZLWKLQWKH GLIIHUHQWKRXVHKROGV FRUULGRU 6RPH RI WKHVH UHWDLOHUV LQFOXGH 'ROODU *HQHUDO&96:DOJUHHQ·VDQG0DUF·V %DVHGXSRQRXUÀ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ÀFHVSDFHVVKRXOGEHRQVFDOH GHPRJUDSKLF FRPSDULVRQ FDQ SURYLGH OHYHUDJH ZLWK WKH VXUURXQGLQJ ODQGVFDSH DYHUDJLQJ IRUWKHFLW\WRVKRZUHWDLOHUVWKHSRWHQWLDORIXUEDQ  WR  VTXDUH IHHW HDFK $VVXPLQJ WKDW PDUNHWVDVZHOODVEHJLQWREXLOGUHODWLRQVKLSVZLWK DSSURSULDWH VXEVLGLHV DUH LQ SODFH :H H[SHFW DYDULHW\RIUHWDLOHUV WKDWDSSUR[LPDWHO\WRVTXDUHIHHWRI UHWDLOVSDFHFRXOGEHVXSSRUWHGDWWKHQRUWKHUQ *LYHQWKHV\QHUJLHVWKDWH[LVWZLWKLQWKH6WXG\$UHD DQGFHQWUDOUHWDLODUHDV VXJJHVWHGDERYH RYHU IRU ´XVHGµ DQG ´WKULIWµ SURGXFWV ZH H[SHFW WKDW WKH QH[W ÀYH WR  \HDUV 7KH SUHGRPLQDQFH RI DGGLWLRQDOKLJKTXDOLW\HVWDEOLVKPHQWVZLWKLQWKHVH VPDOOHUUHWDLOVSDFHVLQ1HDU6RXWKVXEPDUNHWDV QLFKHVZRXOGKDYHDJRRGOLNHOLKRRGRIVXUYLYDO ZHOODV]HUROLQHVHWEDFNDQGPXOWLVWRU\VSDFHLV LQNHHSLQJZLWKWKH´URXJKµSODQIRUUHWDLOZLWKLQ :H H[SHFW WKDW DGGLWLRQDO ZHOOSODFHG HDWLQJ WKH3DUVRQV$YHQXHFRUULGRU DQGGULQNLQJHVWDEOLVKPHQWVZRXOGZLWKSUR[LPLW\ WRH[LVWLQJUHVWDXUDQWVFUHDWH´IDPLO\GLQLQJµDQG ´IDVW FDVXDOµ QRGHV WR VHUYH WKH PRUH EXGJHW FKDOOHQJHG UHVLGHQWV RI WKH DUHD DV ZHOO DV RQ WKHJRZRUNHUV

'HYHORSPHQW RI UHVWDXUDQW VSDFH DORQJ 3DUVRQV $YHQXHZRXOG DWWUDFW DIÁXHQW FXVWRPHUV IURP QHLJKERUKRRGV WR WKH ZHVW +RZHYHU LW LV RXU RSLQLRQ WKDW D VLJQLÀFDQW DPRXQW RI PDUNHWLQJ ZRXOG EH UHTXLUHG JLYHQ WKH FRPSHWLWLRQ WKDW H[LVWVZLWKLQWKH1HDU6RXWKDVZHOODV'RZQWRZQ VXEPDUNHWV 3ULFH VHQVLWLYLW\ DQG TXDOLW\ LV NH\WR EXLOGLQJDFXVWRPHUEDVHZLWKLQWKHQHLJKERUKRRGV VXUURXQGLQJ 3DUVRQV $YHQXH %DVHG XSRQ ORFDO H[SHQGLWXUHVDQGVDOHVWKHUHLVSRWHQWLDOKRZHYHU IRUQHZUHVWDXUDQWVWRDWWUDFWGROODUVIURPZLWKLQWKH QHLJKERUKRRGDVZHOODVIURPGULYHE\WUDIÀF

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

+286,1*0$5.(76800$5< LQKLELWHGFRPSDUHGWRWKHRWKHUVXEPDUNHWVODQG FRVWV HQFRXUDJH DQG UHTXLUH KLJKHU GHQVLW\ 6WUHQJWKV GHYHORSPHQW HJPXOWLVWRU\FRQGRPLQLXPV ,W ‡ +RXVLQJVWRFNLVJHQHUDOO\UHVWRUDEOH LV RXU RSLQLRQ WKDW KLVWRULFDO VDOHV RI QHZ VLQJOH ‡ 6LQJOHIDPLO\KRPHVSUHGRPLQDWH IDPLO\KRPHVGRQRWUHÁHFWWKHIXWXUHSRWHQWLDO ‡ 1HLJKERUKRRGV KDYH KLVWRULFDO VLJQLÀFDQFH 5HFHQW DFWLYLW\ LQ WKH PDUNHW LQ IDFW LQGLFDWHV  FKDUDFWHU FRQWLQXLW\ RIVLQJOHIDPLO\ DQG ´SHQWXSµGHPDQGIRUWKLVKRXVLQJDOWHUQDWLYH)RU  GXSOH[KRPHV LQVWDQFHZKHQZHVXUYH\HGWKHSODQQHG+DUULVRQ ‡ :LGH YDULHW\ RI SULFH SRLQWV PD[LPL]H 3DUNGHYHORSPHQWLQWKH6KRUW1RUWKVXEPDUNHWLQ  PDUNHWDELOLW\RIIRUVDOHKRXVLQJ 6HSWHPEHUWKHSURMHFWKDGQRFRPSOHWHG ‡ $IIRUGDELOLW\RIH[LVWLQJVWRFNGUDZVLQYHVWRUV XQLWV EXW KDG DOUHDG\ WDNHQ  UHVHUYDWLRQV IRU ‡ +RXVLQJ YDOXHV ZLWKLQ WKH 1HDU 6RXWK VLQJOHIDPLO\KRPHV  QHLJKERUKRRGV DUH DSSUHFLDWLQJ  IRU  0HULRQ9LOODJHDQG6FKXPDFKHU3ODFH (VWDEOLVKJXLGHOLQHVIRUKRXVLQJSUHVHUYDWLRQZLWKLQ  IRU2OGH7RZQ(DVW  VRXWKVLGHFLYLFRUJDQL]DWLRQV

&KDOOHQJHV ‡ +RXVLQJLVJDLQLQJYDOXHLQPDQ\RIWKH1HDU ‡ 3HUFHSWLRQRIFULPHLQQHLJKERUKRRGV  6RXWK VXEPDUNHW QHLJKERUKRRGV ‡ 0DLQWHQDQFHLVVXHVSODJXHQHLJKERUKRRGV  'HYHORSPHQW DQG UHVWRUDWLRQ RI WKHVH ‡ 9HU\ OLPLWHG FDSDFLW\ ZLWKLQ WKH 1HDU 6RXWK QHLJKERUKRRGVZLOOGLUHFWO\LPSDFWHFRQRPLF VXEPDUNHWWRVXSSRUWQHZPDUNHWUDWHUHQWDO  GHYHORSPHQWRQ3DUVRQV$YHQXHE\DWWUDFWLQJ  KRXVLQJ KLJKHU LQFRPH KRXVHKROGV DV ZHOO DV ‡ 7UDVKDQGSDUNLQJLVVXHVLPSDFWUHVLGHQWVDQG  HQFRXUDJLQJQHLJKERUKRRGSULGHDQGKLJKHU  SRWHQWLDOUHVLGHQWVQHJDWLYHO\  KRPHRZQHUVKLSUDWHV ‡ 6XUURXQGLQJODQGXVHVDUHQRWFRPSOLPHQWDU\  LQVHYHUDOQHLJKERUKRRGV LHPL[RILQGXVWULDO ‡ ,QFUHDVHVLQKRXVLQJYDOXHZLOOGUDZLQYHVWRUV  DQGUHVLGHQWLDOXVHV DQGKRPHRZQHUVZKRWHQGWRKDYHDPXFK ‡ 'HFOLQLQJKRPHRZQHUVKLSUDWHV KLJKHUGHJUHHRIOR\DOW\WRDUHDEXVLQHVVHV ‡ /DFNRIFRPSUHKHQVLYHFRGHHQIRUFHPHQW ‡ 0DQ\DEVHQWHHODQGORUGV ‡ $YHUDJHVDOHVSULFHVRIH[LVWLQJKRPHVLQWKH  1HDU (DVW DQG 6KRUW 1RUWK VXEPDUNHW DUH +RXVLQJ  VRPHZKDWKLJKHUFRPSDUHGWRWKHQHZKRPH :H H[DPLQHG IRUVDOH DQG UHQWDO KRXVLQJ ZLWKLQ  VDOHVZLWKLQWKRVHWZRDUHDV:HFDQDWWULEXWH DFHQWUDOFLW\+RXVLQJ&RPSHWLWLYH0DUNHW$UHD  WKHVHGLIIHUHQFHVLQWKH6KRUW1RUWKLQSDUWWR &0$ 7KH+RXVLQJ&0$LQFOXGHVIRXUVXEPDUNHWV  WKH SUHIHUHQFH IRU KLVWRULF KRPHV DV LQ &ROXPEXV· FHQWUDO FLW\ LQFOXGLQJ WKH VWXG\  FRPSDUHG WR UHODWLYHO\ IHZ ´QHZµ VLQJOH DUHD 1HDU 6RXWK  'RZQWRZQ 6KRUW 1RUWK DQG  IDPLO\KRPHDOWHUQDWLYHVZLWKLQWKHFHQWUDOFLW\ 1HDU (DVW 7KH IROORZLQJ GHWHUPLQDWLRQV DQG UHFRPPHQGDWLRQVDUHEDVHGXSRQDQH[WHQVLYH ‡ 7KH IDFW WKDW H[LVWLQJ KLVWRULF KRPHV DUH À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ÀOO VLQJOHIDPLO\ KRPHV 6FKXPDFKHU 3ODFH  IRU 2OGH 7RZQ (DVW  ZLWK GHVLJQ IHDWXUHV LQ NHHSLQJ ZLWK H[LVWLQJ /RZ LQWHUHVW UDWHV DQG UHVXUJHQFH RI KLVWRULF  DUFKLWHFWXUH GRZQWRZQ QHLJKERUKRRGV KDYH UHVXOWHG LQ KHDOWK\DSSUHFLDWLRQUDWHVLQWKHPDUNHW

1HZ VLQJOHIDPLO\ KRXVLQJ VDOHV KDYH EHHQ VLJQLÀFDQWO\FRQVWUDLQHGE\WKHODFNRIDSSURSULDWH ODQG LQ WKH +RXVLQJ &RPSHWLWLYH 0DUNHW $UHD $OWKRXJK WKH 'RZQWRZQ VXEPDUNHW LV OHVV 1BHF
" (QFRXUDJH SXEOLF DQG SULYDWH GHYHORSPHQW RI ‡ 1HDUO\  RI DOO KRXVLQJ XQLWV LQ WKH 1HDU LQÀOOVLQJOHIDPLO\KRPHV  6RXWK VXEPDUNHW   DUH VLQJOHXQLW  DWWDFKHG RU GHWDFKHG RU WZR WR IRXUXQLW ‡ ,QYLWHHIIRUWVWRUHSODFHIXQFWLRQDOO\REVROHWH  VWUXFWXUHV7KLV LV D FRQVLGHUDEOH VKDUH RI  DQG FRQGHPQHG KRXVLQJZLWK QHZ PDUNHW  VPDOOQXPEHUKRXVLQJXQLWV,WLVDOVRLQGLFDWLYH  UDWHDQGDIIRUGDEOHLQÀOOKRPHV  RIWKHODFNRIPRGHUQFRQYHQWLRQDOPXOWLIDPLO\ DSDUWPHQWGHYHORSPHQW ‡ 6HYHUHO\ GLODSLGDWHG XQLWV JLYH RSSRUWXQLW\  IRUOLPLWHGLQÀOOGHYHORSPHQW1HZVLQJOHIDPLO\ ‡ 7KH RQO\ H[LVWLQJ FRQYHQWLRQDO SURGXFW  KRXVLQJ VDOHV KDYH EHHQ VLJQLÀFDQWO\  LGHQWLÀHG ZLWKLQ WKH 1HDU 6RXWK VXEPDUNHW  FRQVWUDLQHGE\WKHODFNRIDSSURSULDWHODQGLQ  LVSXEOLFKRXVLQJRSHUDWHGE\WKH&ROXPEXV  WKH+RXVLQJ&RPSHWLWLYH0DUNHW$UHD  0HWURSROLWDQ +RXVLQJ $XWKRULW\ 7KH WKUHH  SURMHFWV ZLWKLQ WKH VXEPDUNHW ERXQGDULHV ‡ 1HZ DIIRUGDEOH IRUVDOH DQG IRUUHQW LQÀOO  /LQFROQ3DUN5HHE+RVDFN)DPLO\$SDUWPHQWV  KRXVLQJ GHYHORSHG E\ &ROXPEXV +RXVLQJ  DQG0DULRQ9LOODJH6HQLRU$SDUWPHQWV KDYH  3DUWQHUVKLSH[SHULHQFHGYHU\KLJKDEVRUSWLRQ  UHQWV WKDW DUH LQFRPHEDVHG DQG ZRXOG  UDWHVDGGLQJRUNHHSLQJZRUNLQJKRXVHKROGV  QRW EH FRQVLGHUHG FRPSHWLWLYH ZLWK PDUNHW  LQ WKH DUHD QRWHV D VSRNHVSHUVRQ IRU WKDW  UDWHGHYHORSPHQWV  RUJDQL]DWLRQ ‡ ,QÀOO GHYHORSPHQW RIDIIRUGDEOH /RZ ‡ 7KH QHZEXLOW LQÀOO FRQFHSW LV DWWUDFWLYH WR  ,QFRPH +RXVLQJ 7D[ &UHGLW  DQGRU +20(  ERWKROGHU DQG \RXQJHU KRXVHKROGV³WKRVH  IXQGHG DSDUWPHQWV LQ OLPLWHG QXPEHUV XS  WKDW GR QRW ZDQW WR VSHQG WLPH RQ  WRXQLWV DORQJ3DUVRQV$YHQXHRUVXUURXQGLQJ  PDLQWHQDQFHWDVNV  QHLJKERUKRRGV FRXOG EH VXSSRUWHG %DVHG  XSRQDEVRUSWLRQWUHQGVRIVLQJOHIDPLO\UHQWDO ‡ 7KH +RXVLQJ &0$ KDV D QHW DQQXDOL]HG XQLWV ZH H[SHFW WKDW XS WR  XQLWV RI  GHPDQGIRUDQHVWLPDWHGQHZO\FRQVWUXFWHG  DIIRUGDEOH IDPLO\DSDUWPHQWV ZRXOG VLQJOHIDPLO\KRPHVEDVHGXSRQPDUNHWUDWH H[SHULHQFH OHDVHXS SHULRGV RI VHYHQ WR  SULFLQJDQGFDSWXUHUDWHV7KLVGHPDQGH[LVWV XQLWVSHUPRQWK  ZLWKLQ WZR GLIIHUHQW SULFH SRLQWV OHVV WKDQ  DQGWR7KHGHPDQG ‡ 7KH FRQVWUXFWLRQ RI VHQLRU DSDUWPHQWV ZLWK  ZRXOGRIFRXUVHH[SDQGLIGHYHORSHUVWDUJHWHG  VHUYLFHVRUVXSSRUWLYHOLYLQJIDFLOLW\ZRXOGOLNHO\  ORZHULQFRPHKRXVHKROGVZLWKDIIRUGDEOHIRU  EH PHW ZLWK VLJQLÀFDQW VXSSRUW IURP WKLV  VDOHXQLWV  DUHD1RWHWKDWWKHPDMRULW\RIVXSSRUWIRUWKLV  W\SHRIKRXVLQJZRXOGOLNHO\FRPHIURP´ROGHUµ ‡ :LWKLQ WKH 1HDU 6RXWK VXEPDUNHW    VHQLRUVWKDWLVKRXVHKROGVZLWKLQWKH1HDU  KRPHV QHZFRQVWUXFWLRQ LQÀOO RU ´VLQJOHORWµ  6RXWK VXEPDUNHW %DVHG XSRQ GHPRJUDSKLF  KRPHV UDQJHG LQ SULFH IURP  WR  DQG HFRQRPLF WUHQGV LQ WKH 1HDU 6RXWK  ZLWKDQDYHUDJHSULFHRI  VXEPDUNHWZHH[SHFWWKDWWKHDGGLWLRQRI ([LVWLQJ KRPH VDOHV UHÁHFWHG D PXFK ZLGHU  WR  QHZ DIIRUGDEOH /RZ,QFRPH +RXVLQJ  SULFH UDQJH  WR  DQG D IDU  7D[ &UHGLW +20(  VHQLRU XQLWV WR WKLV PDUNHW  ORZHUDYHUDJHVDOHVSULFH    FRXOGEHVXSSRUWHG

‡ %DVHGXSRQWKH&HQVXVWKH1HDU6RXWK ‡ :H VXUYH\HG  IRUUHQW VLQJOHIDPLO\ DQG  VXEPDUNHWKDVWKHORZHVWHVWLPDWHG H[LVWLQJ  GXSOH[ KRPHV ZLWKLQ WKH 1HDU 6RXWK  KRXVLQJ YDOXH HVWLPDWHG E\ KRPHRZQHUV   VXEPDUNHW$WRWDORIVHYHQ  RIWKHVLQJOH  ZLWKLQWKH+RXVLQJ&0$DW&RPSDUHG  IDPLO\UHQWDOVVXUYH\HGDUHRQHVWRU\JDUGHQ  ZLWK WKH 1HDU (DVW   DQG 'RZQWRZQ  VW\OH XQLWV ZKLOH WKH UHPDLQLQJ  DUH    WKLV ORZ HVWLPDWHG KRPH YDOXH  WRZQKRXVH VW\OH XQLWV *LYHQ WKH DJH UHÁHFWVDSUHGRPLQDQFHRIROGHUVWRFNWKDWLV  GLVWULEXWLRQRIWKH1HDU6RXWKPDUNHWDUHDDV  OLNHO\LQQHHGRIUHSDLUVDQGPD\EHQHJDWLYHO\  ZHOO DV WUHQGV LQGLFDWLQJ LQFUHDVLQJ QXPEHUV  LQÁXHQFHG E\ VXUURXQGLQJ ODQG XVHV ([SORUH RI VHQLRU KRXVHKROGHUV ZH H[SHFW WKDW WKLV  IXUWKHU WKH SRWHQWLDO IRU GHYHORSPHQW RI  XQLW GHVLJQ ZLOO SUHYHQW VRPH VHQLRUV  DIIRUGDEOHDQGPDUNHWUDWHIDPLO\DQGVHQLRU  SDUWLFXODUO\ WKRVH ZLWK GLVDELOLWLHV IURP  UHQWDOSURMHFWV  UHPDLQLQJLQWKHQHLJKERUKRRG

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

‡ 7KHUHLVFXUUHQWO\RQHVHQLRUVSHFLÀFDSDUWPHQW DQG &  2 UDLOURDG \DUG DOO FRQWULEXWH WR WKH  SURMHFWLQWKH1HDU6RXWKDUHD0DULRQ6TXDUH XUEDQ LQGXVWULDO FKDUDFWHU RI WKH ODQGVFDSH  D SXEOLF KRXVLQJ GHYHORSPHQW ORFDWHG RQ 7KLV FKDUDFWHU GHÀQHG JHQHUDWLRQV RI UHVLGHQWV  0DULRQ 5RDG HDVW RI /RFNERXUQH 5RDG RIWKHDUHDDQGLQRXURSLQLRQSUHVHUYLQJVRPH  WDUJHWV ORZLQFRPH VHQLRU KRXVHKROGV DJH RI WKH LQGXVWULDO KLVWRU\ RI WKH DUHD ZLOO  VHUYH WR  DQGRYHU7KHVHKRXVHKROGVKDYHLQFRPHV PDLQWDLQSULGHDQGLGHQWLW\IRUWKHVRXWKVLGHIRU  RIOHVVWKDQRIWKHDUHDPHGLDQKRXVHKROG JHQHUDWLRQVWRFRPH  LQFRPH WR TXDOLI\ WR OLYH WKHUH :H H[SHFW  WKDWDVVRXWKVLGHKRXVHKROGHU·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À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ÀOLQJ OLHQV RQ VHYHUHO\ QHJOHFWHG RIÀFHVSDFHZLOOEHUHQRYDWHGDQGPDUNHWHGWR SURSHUWLHV IRU XQSDLG QXLVDQFH ÀQHV DQG XVLQJ ZDUHKRXVLQJ VPDOO FRPPHUFLDO RSHUDWLRQV DQG WKRVH OLHQV WR SXUVXH IRUHFORVXUHV WKURXJK WKH RIÀFHXVHUV'HYHORSHU0DUYLQ.DW]HVWLPDWHVWKH )UDQNOLQ&RXQW\(QYLURQPHQWDO&RXUW&LW\$WWRUQH\ VLWHZLOOEHDYDLODEOHE\WKHODWHVSULQJRI.DW] 5LFKDUG&3IHLIIHU-UQRWHVLQD&ROXPEXV'LVSDWFK SURMHFWVWKDWWKHVLWHZKHQFRPSOHWHO\RFFXSLHG DUWLFOHGDWHG$XJXVW´7KHJRDOLVWRJHW ZLOOFRQWDLQEHWZHHQDQGZRUNHUV SURSHUWLHVLQWRWKHKDQGVRIUHVSRQVLEOHRZQHUVµ :KLOHVXFKVWUXFWXUHVW\SLFDOO\ZRXOGKDYHOLWWOHWR 7KLV GHYHORSPHQW UHQDPHG 7HFK &HQWHU6RXWK QRYDOXHWKHYDOXHRIWKHODQGZRXOGEHZRUWK LV H[SHFWHG WR KDYH D YHU\ SRVLWLYH LPSDFW RQ GHPROLWLRQFRVWV WKH QHLJKERUKRRG DOWKRXJK LQFUHDVHG WUDIÀF IURP ZDUHKRXVLQJ DFWLYLW\ DQG VLWH WHQDQWV 7\SLFDOO\ PDUNHWUDWH LQÀOO GHYHORSPHQWV VDWLVI\ DQG HPSOR\HHV LV D QHJDWLYH DOEHLW QHFHVVDU\ D GHPDQG IRU QHZ IRUVDOH KRXVLQJ ZLWKLQ DQ VLGH DIIHFW WR WKH GHYHORSPHQW .DSDF .DW]·V ROGHU HVWDEOLVKHG QHLJKERUKRRG 7KLV FRQFHSW FRPSDQ\LVNQRZQIRUVXFFHVVIXODFTXLVLWLRQDQG LV DWWUDFWLYH WR KRXVHKROGV WKDW GR QRW ZLVK WR GHYHORSPHQWRILQGXVWULDODQGZDUHKRXVHVSDFH PDLQWDLQRUUHQRYDWHROGHUKRPHVDQGRIFRXUVH KDYLQJFRPSOHWHGVHYHUDOSURMHFWVLQ&ROXPEXV· WRUHQWHUKRXVHKROGVZKRPD\ZLVKWRSXUFKDVH XUEDQFRUH D KRPH EXW GR QRW KDYH H[SHULHQFH LQ KRPH PDLQWHQDQFH7KHDUHD·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ÀFDWLRQ RI WKH VRXWKHUQ SRUWDO WR WKH FRUULGRU 7KLV GRHV QRW QHFHVVDULO\ PHDQ WKDW DOO RIWKHXQGHUXWLOL]HGLQGXVWULDOEXLOGLQJVEHUD]HG 7KH FOXVWHU RI LQGXVWULDO XVHVWKDW H[WHQGV GRZQ WKHVRXWKHUQWKLUGRIWKHFRUULGRUDQGSUHVHQFH RIERWKWKH1RUIRONDQG6RXWKHUQUDLOURDGWUDFNV 1BHF
" %XLOGV\QHUJ\DPRQJVPDOOPDQXIDFWXUHUVZLWKLQ 7KH VWXG\ DUHD·V SUR[LPLW\ WR WKH 5LFNHQEDFNHU ORZFRVWVSDFHV ,QWHUPRGDO7UDQVLWIDFLOLW\FDQIDFLOLWDWHPDUNHWLQJ LQGXVWULDODQGFRPPHUFLDOSURSHUW\DORQJ3DUVRQV :KLOHWKHIRUPHU)HGHUDO*ODVVVLWHLVFXUUHQWO\RYHU $YHQXH$FFRUGLQJWR1RUEULGJH5HVHDUFK   KDOIYDFDQWZHH[SHFWWKDWWKHGHYHORSPHQWRI LQWHUPRGDO \DUGV RIWHQ DWWUDFW DIÀOLDWHG DQG WKH7HFKQHJODVVLWHZKLFKLVORFDWHGDGMDFHQWWR UHODWHGHFRQRPLFGHYHORSPHQWVLQFOXGLQJ WKHQRUWKPD\VSXULQFUHDVHGDFWLYLW\7KH)HGHUDO *ODVVVLWHKDVH[FHOOHQWDFFHVVUHDGLO\DYDLODEOH ‡ 2ULJLQ DQG GHVWLQDWLRQ GUD\DJH FRPSDQLHV ORZFRVWVSDFHWKDWDSSHDUVWREHHDVLO\GLYLGHG  ZKLFKVHUYHDVDNH\OLQNEHWZHHQLQWHUPRGDO LQRUGHUWRDFFRPPRGDWHVPDOOXVHUV UDLOIDFLOLWLHVDQGVKLSSHUVUHFHLYHV ‡ (TXLSPHQW 0DLQWHQDQFH &RPSDQLHV ZKLFK :H GR QRW UHFRPPHQG SXEOLFSULYDWH YHQWXUHV  VHUYHHTXLSPHQWQHHGVRIWUXFNWHUPLQDODQG IRU GHYHORSLQJ DGGLWLRQDO ODUJHVFDOH LQGXVWULDO UDLO RSHUDWLRQV WKLV JURXS LQFOXGHV LQ PDQXIDFWXULQJVSDFHZLWKLQRULQFORVHSUR[LPLW\  SDUWLFXODU WKRVH FRPSDQLHV VSHFLDOL]LQJ LQ WRWKH3DUVRQV$YHQXHFRUULGRUDUHD3HUFHSWLRQV  FRQWDLQHU FKDVVLV OLIW HTXLSPHQW KRVWOHU RIQRLVHDQGDLUSROOXWLRQLQFUHDVHGWUXFNWUDIÀF  WUDFWRUVDQGUDLOHTXLSPHQW DQG RWKHU QHJDWLYH VLGH HIIHFWV DUH DVVRFLDWHG ‡ 3XEOLFDQGSULYDWHZDUHKRXVHDQGGLVWULEXWLRQ ZLWK KHDY\ LQGXVWULDO XVHUV $OWKRXJK FRPPXQLW\  FHQWHUVZKLFKEHQHÀWIURPDSUR[LPLW\WRDQ PHPEHUV ZHOFRPH DGGLWLRQDO MRE JURZWK ZLWKLQ  LQWHUPRGDO UDLO \DUG LQFOXGLQJ WKLUG SDUW\ WKH QHLJKERUKRRG VPDOOHU PDQXIDFWXULQJ ORJLVWLFFRPSDQ\RSHUDWHGZDUHKRXVHV FRPSDQLHVRURWKHUEXVLQHVVW\SHVDUHSUHIHUUHG ‡ 0DQXIDFWXULQJ DQG SURFHVVLQJ FRPSDQLHV RYHU ODUJHVFDOH KHDY\ LQGXVWU\ 6RPH SRWHQWLDO ZKLFK UHGXFH VKLSSLQJ DQG UHFHLYLQJ FRVWV XVHV IRU YDFDQW LQGXVWULDOZDUHKRXVH VSDFHV  DQG H[SHGLWH VKLSSLQJ DQG UHFHLYLQJ E\ LQFOXGH  SUR[LPLW\WRLQWHUPRGDOVLWHV

‡0DFKLQLQJDQGPHWDOZRUNLQJYRFDWLRQDOWUDLQLQJ 7KH DELOLW\ WR DWWUDFW UHODWHG DFWLYLWLHV RI ‡/RJLVWLFVDQGWUDQVSRUWDWLRQYRFDWLRQDOWUDLQLQJ ZDUHKRXVLQJ GLVWULEXWLRQ DQG PDQXIDFWXULQJ ‡6PDOOEXVLQHVVGHYHORSPHQWWUDLQLQJ LV FORVHO\OLQNHG KRZHYHU WR WKH DYDLODELOLW\RI ‡0DFKLQLQJWRRODQGG\HRSHUDWLRQV DSSURSULDWHO\VNLOOHGODERUODERUFRVWVHFRQRPLF ‡&XVWRPHUVHUYLFHFDOOFHQWHU LQFHQWLYHVDQGFXUUHQWDYDLODELOLW\RI?IDFLOLWLHVDQG ‡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·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

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

7KH GHYHORSPHQW RI WKH LQWHUPRGDO WUDQVSRUW 'HPRJUDSKLFV IDFLOLW\ UHSUHVHQWV MRE RSSRUWXQLWLHV IRU 1HDU 6RXWK UHVLGHQWV DV ZHOO DV RSSRUWXQLWLHV IRU ‡ 3URMHFWLRQV LQGLFDWH DQ  GHFUHDVH LQ UHGHYHORSPHQWRIH[LVWLQJLQGXVWULDOZDUHKRXVLQJ  SRSXODWLRQ DQG DQ  GHFOLQH LQ VSDFHZLWKLQWKHFRUULGRU+RZHYHUWKHSRWHQWLDO  KRXVHKROGV LQ WKH 1HDU 6RXWK VXEPDUNHW YDFDQWPDQXIDFWXULQJVLWHVWREHDEVRUEHGWREH  7KLV LV WKH KLJKHVW UDWH RI GHFOLQH SURMHFWHG ´FOHDQHGXSµDQGFRQYHUWHGWRIXQFWLRQLQJOLJKW  IRU DQ\RI WKH &HQWUDO &LW\ VXEPDUNHWV 7KH PDQXIDFWXULQJ DQG FRPPHUFLDO VSDFHV VKRXOG  'RZQWRZQVXEPDUNHW&ROXPEXVDQG)UDQNOLQ EHOHYHUDJHGWRJHWKHUZLWKDUHDG\ZRUNIRUFH  &RXQW\ DUH DOO SURMHFWHG WR LQFUHDVH LQ  SRSXODWLRQDQGKRXVHKROGV (VWDEOLVKLQJ D VXEVWDQWLYH RQJRLQJ UHODWLRQVKLS EHWZHHQ ODUJH JURZLQJ HPSOR\HUV WR WKH QRUWK ‡ 6RPHRIWKLVQHJDWLYHJURZWKFDQEHDWWULEXWHG DQG VRXWK RI WKH VWXG\ DUHD DQG LQLWLDWLQJ  WRWKHUHSODFHPHQWRIODUJHUKRXVHKROGVZLWK DQ RQJRLQJ LQIRUPDWLRQ H[FKDQJH EHWZHHQ  VPDOOHU KRXVHKROGV SDUWLFXODUO\ ZLWKLQ WKH KXPDQ UHVRXUFHV GHSDUWPHQWV DQG ORFDO KLJK  PRUHDIÁXHQW*HUPDQ9LOODJH0HULRQ9LOODJH VFKRROVYRFDWLRQDOVFKRROVDQGRWKHUZRUNIRUFH  DQG6FKXPDFKHU3ODFHQHLJKERUKRRGV GHYHORSPHQW SURYLGHUV LV HVVHQWLDO -RE WUDLQLQJ DQGUHDGLQHVVFRXOGIRFXVRQWKHVSHFLÀFQHHGV ‡ :H H[SHFW WKDW GHWHULRUDWLQJ KRXVLQJ VWRFN RIORFDOHPSOR\HUVWUDQVSRUWDWLRQVHUYLFHVFRXOG  MREORVVHVDQGQHJDWLYHSHUFHSWLRQVKDYHDOVR IDFLOLWDWHMREFUHDWLRQLQWDUJHWHGQHLJKERUKRRG  FRQWULEXWHG WR SRSXODWLRQ DQG KRXVHKROG DUHDV DQG UHIHUUDO VHUYLFHV FRXOG SLQSRLQW MRE  ORVVHVLQWKH1HDU6RXWKVXEPDUNHW JURZWKDVZHOODVWUHQGVLQKLULQJ ‡ 7KH 1HDU (DVW DQG 1HDU 6RXWK VXEPDUNHWV ,QVWLWXWLRQDO  FRQWDLQ WKH KLJKHVW UDWLR RI LQGLYLGXDOV OHVV  WKDQ\HDUVRIDJHDPRQJDOORIWKHFHQWUDO $QDGGLWLRQDOUHFRPPHQGDWLRQLVUHODWHGWRWKH FLW\VXEDUHDV&ROXPEXVDQG)UDQNOLQ&RXQW\ HYHQWXDOUHORFDWLRQRIWKH3DUVRQV$YHQXHEUDQFK  DOVRKDYHKLJKVKDUHVRISRSXODWLRQZLWKLQWKLV RIWKH&ROXPEXV0HWURSROLWDQ/LEUDU\$FFRUGLQJ  DJHJURXS WRRXULQWHUYLHZVZLWKOLEUDU\VWDIIDQGUHORFDWLRQ VSRNHVSHUVRQV WKH QHZ VLWH IRU WKLV EUDQFK ZLOO ‡ 9DVVRU 9LOODJH KDV WKH \RXQJHVW HVWLPDWHG OLNHO\EHPRUHFHQWUDOO\ORFDWHGZLWKLQWKHVWXG\  PHGLDQ DJH LQ  DW  \HDUV ZKLOH DUHD *LYHQ WKDW WKHUH LV D QHHG IRU DGGLWLRQDO  6WDPEDXJK(OZRRG KDV WKH ROGHVW DW  SDUNLQJDWWKHFXUUHQWOLEUDU\VLWHDQHZEXLOGLQJ  7KH9DVVRU9LOODJHPHGLDQLVOLNHO\LQÁXHQFHG ZRXOGLQFOXGHDODUJHULQWHULRUVSDFHDVZHOODV  KHDYLO\E\ WKH SUHVHQFH RI WKH /LQFROQ LQFUHDVHGVSDFHIRUSDUNLQJ  3DUNSXEOLFKRXVLQJGHYHORSPHQWZLWKLQWKDW  QHLJKERUKRRG/LQFROQ3DUNFRQWDLQVDODUJH 6RXWKVLGH /HDUQLQJ DQG 'HYHORSPHQW &HQWHU  QXPEHURIIDPLOLHVZLWK\RXQJFKLOGUHQ LV FRQVLGHULQJ D FRPELQHG FDPSDLJQ ZLWK D FRXSOHRIGLIIHUHQWHDUO\FKLOGKRRGOHDUQLQJDQG ‡ 7KH QHLJKERUKRRG DUHDV FRQWDLQLQJ WKH GHYHORSPHQWJURXSVZLWKLQWKHFHQWUDOFLW\7KH KLJKHVW VKDUH RI SRSXODWLRQ XQGHU  DUH FXUUHQW FDSLWDO FDPSDLJQ LV LQ SURFHVV 66/'&  DVIROORZV9DVVRU9LOODJH6RXWKHUQ2UFKDUGV KDVUDLVHGDSSUR[LPDWHO\WRGDWH7KHVH  6RXWKVLGH&$1+XQJDULDQ9LOODJHDQG5HHE IXQGVKDYHEHHQXVHGWRKHOSUHGHYHORSWKHVLWH  +RVDFNUHVSHFWLYHO\ IRUWKHSODQQHGEXLOGLQJ1HHGDQDGGLWLRQDO PLOOLRQDSSUR[LPDWHO\WRFRPSOHWHWKHSURMHFW ‡ 3URMHFWLRQVLQGLFDWHLQFUHDVHVLQPHGLDQDJH  DPRQJ DOO JHRJUDSKLF DUHDV 7KH PRVW VLJQLÀFDQWLQFUHDVHVDUHZLWKLQWKHWRDQG   DJH JURXSV ZKLOH DOO WKH \RXQJHU DJH  JURXSVDUHH[SHFWHGWRH[SHULHQFHGHFOLQHV  LQ QXPEHUV 7KH 1HDU 6RXWK VXEPDUNHW LV  SURMHFWHG WR KDYH WKH ODUJHVW SHUFHQWDJH  LQFUHDVHLQPHGLDQDJHRIDOOWKHJHRJUDSKLF  DUHDV LQ WKH DQDO\VLV DW  IURP  WR   \HDUVROG 

1BHF
" ‡ $FFRUGLQJ WR &HQVXV HVWLPDWHV LQ   RZQHURFFXSLHGKRXVHKROGVLQWKH1HDU6RXWK ‡ 2I WKH HVWLPDWHG  KRXVHKROGV LQ WKH  VXEPDUNHWFRPSULVHGRIDOOKRXVHKROGV  1HDU 6RXWK VXEPDUNHW LQ   KDG  &HQVXV SURMHFWLRQV WR  LQGLFDWH VOLJKW  $QQXDO +RXVHKROG ,QFRPH $+,  RI OHVV WKDQ  LQFUHDVHV LQ UHQWHURFFXSLHG KRXVHKROGV   ‡ $V LV W\SLFDO RI PDQ\ ROGHU XUEDQ ZLWKLQWKLVVXEPDUNHW:HH[SHFWWKLVRZQHU  DUHDVWKHPHGLDQLQFRPHIRUWKH1HDU6RXWK  UHQWHU UDWLR WR UHPDLQ UHODWLYHO\ XQFKDQJHG  VXEPDUNHW LV PXFK ORZHU WKDQ WKH QDWLRQDO  IRU WKH QH[W VHYHUDO \HDUV 7KH LQFUHDVH LQ  PHGLDQ LQFRPH RI  $W  WKH  KRXVLQJYDOXHVH[SHFWHGWRFRQWLQXHWRGUDZ  PHGLDQ LQFRPH LV QHDUO\  EHORZ WKH  LQWHUHVWIURPERWKKRPHRZQHUVDQGLQYHVWRUV  QDWLRQDOPHGLDQ

‡ :LWKLQ ERWK RZQHU DQG UHQWHURFFXSLHG ‡ :LWKLQ WKH HFRQRPLFDOO\ GLYHUVH 1HDU 6RXWK  KRXVHKROGV LQ WKH 1HDU 6RXWK VXEPDUNHW  VXEPDUNHWSRODUL]DWLRQRILQFRPHLVSURMHFWHG  RQH DQG WZRSHUVRQ KRXVHKROGV FRPSULVHG  WRFRQWLQXHWR7KHDUHDLVH[SHFWHGWR  DSSUR[LPDWHO\ WZRWKLUGV RI DOO KRXVHKROGV  H[SHULHQFHJURZWKDPRQJKRXVHKROGVHDUQLQJ  ZLWKLQWKH1HDU6RXWKVXEPDUNHWFRPSDUHG   DQG RYHU ,Q  WKHVH KRXVHKROGV  ZLWKRYHULQWKH6KRUW1RUWKVXEPDUNHW  FRPSULVHGRIDOOKRXVHKROGVZKLOH  SURMHFWLRQVLQGLFDWHWKH\ZLOOPDNHXSRI ‡ /DUJHUVL]HGKRXVHKROGVFRPSULVHGRIIRXURU  DOO KRXVHKROGV +RXVHKROGV HDUQLQJ XQGHU  PRUH SHUVRQV PDGH XS  RI RZQHU   ZLOO GHFUHDVH IURP QHDUO\  WR  KRXVHKROGV DQG  RI UHQWHU KRXVHKROGV  GXULQJWKLVWLPH  ZLWKLQWKH1HDU6RXWKVXEPDUNHW

‡ ,QWHUHVWLQJO\WKH1HDU6RXWKDQG1HDU(DVWVXE  PDUNHWV FRQWDLQHG PXFK KLJKHU VKDUHV RI  ODUJHU UHQWHURFFXSLHG KRXVHKROGV WKDQ GLG  'RZQWRZQRUWKH6KRUW1RUWK7KH1HDU6RXWK  DOVRFRQWDLQVRQHRIWKHKLJKHVWUDWLRVRIODUJHU  KRXVLQJXQLWV

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

)*4503*$
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·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ÀQDQFLDO 8UEDQ 3ODQQHUV ZRXOG DJUHH WKDW WKH GLYHUVLW\ FRPPLWPHQWERWKRISXEOLFDQGSULYDWHVRXUFHV WKH$YHQXHHQMR\VWRGD\LVRQHRIWKHKDOOPDUNV DQG D FRPPLWPHQW RI OHDGHUVKLS WR UHYHUVH RU PDNLQJDQ\JUHDWQHLJKERUKRRG·VVXFFHVV LPSURYH EXW KRSH LV QRW ORVW  3DUVRQV $YHQXH VWLOO UHWDLQV RXWVWDQGLQJ RSSRUWXQLWLHV IRU KLVWRULF 1RWZLWKVWDQGLQJ WKDW GLYHUVLW\ KROGV FKDOOHQJHV SUHVHUYDWLRQ KLVWRULF UHKDELOLWDWLRQ DGDSWLYH WKDWKDVDOVREURXJKWVKLIWVWRWKHQHLJKERUKRRG·V UHXVHDQGFRPSDWLEOHLQÀ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ÀFDQFH RU PRUHLQNHHSLQJZLWKVXEXUEDQVSUDZO7KLVDSSURDFK WKDWSRVHGVLJQLÀFDQWUHKDELOLWDWLRQRSSRUWXQLWLHV WRGHYHORSPHQWDORQJWKH$YHQXHKDVLQSDUWOHG DV SDUW RI D QHLJKERUKRRG UHYLWDOL]DWLRQ HIIRUW WRLWVGHFOLQH$QDWWUDFWLYHSK\VLFDOHQYLURQPHQW $GGLWLRQDOPHPEHUVRIWKHWRXULQJWHDPLQFOXGHG RIDQ\QHLJKERUKRRGRUFRPPHUFLDODUHDLVDNH\ XUEDQ SODQQHUV KLVWRULDQV QHLJKERUKRRG FRPSRQHQW LQ LWV VWDELOLW\ DWWUDFWLYHQHVV LPDJH RUJDQL]DWLRQ UHSUHVHQWDWLYHV DV ZHOO DV %%+ DQGPDUNHWDELOLW\7KH3DUVRQV$YHQXHDUHDLVQRZ SURMHFW OHDGHUV  'XULQJ WKLV GD\ORQJ WRXU DQ VWUXJJOLQJ WR ÀQG LWV LGHQWLW\ LQ ZKLFK WR SURPRWH RYHUDOODVVHVVPHQWWKDWLGHQWLÀ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´VSRWGHYHORSPHQWµWKDWKDVEHHQXQGHUWDNHQ  0DLQWHQDQFH LVVXHV DQG SURSHU GHVLJQ VFDWWHUHG GHPROLWLRQV DQG LQFRPSDWLEOH  WHFKQLTXHV WKDW VKRXOG EH FRQVLGHUHG DORQJ GHYHORSPHQWRYHUWKH\HDUVKDVWDNHQWKHLUWROO 3DUVRQV$YHQXHWKDW ZRXOG EHUHOHYDQW WR DQGKDVLQSDUWFRQWULEXWHGWRDQHJDWLYHLPDJH  HVSHFLDOO\WKHFRPPHUFLDOVWUXFWXUHVRIWKH'LVWULFW

1BHF
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·PRVW RIWKHWKDQGHDUO\WKFHQWXULHV3DUVRQV$YHQXH GHVLUHG QHLJKERUKRRGVLQ ZKLFK WR UHVLGH EHFDXVH LV DFWXDOO\ GHYLVHG RI WKUHH VXEQHLJKERUKRRGV  $ WKHKLVWRULFLQWHJULW\RI*HUPDQ9LOODJHLVPDLQWDLQHG QXPEHURIODWHU0LG&HQWXU\URDGVLGHDUFKLWHFWXUDO WKURXJKORFDOUHYLHZDQGGHVLJQRUGLQDQFHV3URMHFWV VW\OHV DOVR GRW $YHQXH DV ZHOO WKDW FRXOG EH RI WKDW DOVR LQYROYH )HGHUDO GROODUV IRU GHPROLWLRQ RU VLJQLÀFDQWQRWHDVZHOOLQWHUPVRIWKH´UHFHQWSDVWµ UHKDELOLWDWLRQ DOVR LQYROYH D UHYLHZ SURFHVV NQRZQ 7KHVH 0LG &HQWXU\ VWUXFWXUHV DUH DOVR VRPH RI WKH DV 6HFWLRQ  WR GHWHUPLQH LI WKHUH ZRXOG EH DQ\ HDUOLHVWGHYHORSPHQWVWKDWVLJQDOHGWKHWUDQVLWLRQRI DGYHUVHHIIHFWVXSRQVWUXFWXUHVRUSODFHVHLWKHUOLVWHG 3DUVRQV $YHQXH WR EH PRUH RULHQWHG WR VXEXUEDQ RUHOLJLEOHIRUWKH1DWLRQDO5HJLVWHURI+LVWRULF3ODFH VW\OHGHYHORSPHQWDQGYHKLFXODUWUDIÀFUDWKHUWKDQ D SHGHVWULDQ RU QHLJKERUKRRG RULHQWDWLRQ  ,W LV +RZHYHU WKH 1DWLRQDO 5HJLVWHU GHVLJQDWLRQ '2(6 LQWHUHVWLQJWRQRWHPDQ\RIWKHKLVWRULFDUFKLWHFWXUDO LQ IDFW SURYLGH DQ RSSRUWXQLW\ IRU 3DUVRQV $YHQXH VW\OHV IRXQG DORQJ WKH $YHQXH DUH IURP ZKDW LV WKDW FRXOG EH RI EHQHÀW LQ WHUPV RI WD[ LQFHQWLYHV FRPPRQO\UHIHUUHGWRDVWKH´6WRU\ERRNµHUDRIWK KHULWDJH WRXULVP RSSRUWXQLWLHV DQG JUDQW VRXUFHV FHQWXU\DUFKLWHFWXUH0HDQLQJWKHVHEXLOGLQJW\SHV IRU VSHFLÀF SURMHFWV  7KHUH LV DOVR D ZLGHVSUHDG UHSUHVHQW VWRU\ERRNIDLU\ WDOH W\SH RI DUFKLWHFWXUH P\WKWKDWLQRUGHUWREHFRQVLGHUHGIRUWKH1DWLRQDO WKDWZDVEHJLQQLQJWREHURPDQWLFL]HGLQOLWHUDWXUH 5HJLVWHURI+LVWRULF3ODFHVWKDWDVWUXFWXUHRUDSODFH DQG HDUO\ÀOPV  7KHVH VW\OHV DOVR WHQG WR UHSUHVHQW PXVW KROG H[WUHPHO\ KLJK KLVWRULF DVVRFLDWLRQV RU ROGHUW\SHVRIDUFKLWHFWXUHIURPWKH´2OG:RUOGµLQ DUFKLWHFWXUDOYDOXH7KLVLVQRWQHFHVVDULO\VRRUWREH (XURSH DQG ZHUH UHLQWURGXFHG DQG SRSXODUL]HG LQ FRQVLGHUHGIRUORFDOODQGPDUNGHVLJQDWLRQSRWHQWLDO $PHULFDQDUFKLWHFWXUHLQWKHHDUO\VWKURXJKWKH )RUIXUWKHULQIRUPDWLRQFRQFHUQLQJWKHIXOOFULWHULDRI HDUO\V7KHVHVW\OHVRIDUFKLWHFWXUHLQFOXGH OLVWLQJ SURSHUW\ WR WKH 1DWLRQDO 5HJLVWHU RI+LVWRULF 3ODFHVVHHWKHER[LQVHWEHORZRUFRQWDFWWKH2KLR 6SDQLVK6SDQLVK0LVVLRQ5HYLYDO +LVWRULF 3UHVHUYDWLRQ 2IÀFH DW  RU YLVLW 7XGRU5HYLYDO ZZZRKLRKLVWRU\RUJ

$GGLWLRQDOVW\OHVWKDWDSSHDUDORQJ3DUVRQV$YHQXH ,WVKRXOGDOVREHQRWHGWKDWKLVWRULFRUDUFKLWHFWXUDO IURPWKHWKDQGWKFHQWXULHVLQFOXGH UHOHYDQFHRIVWUXFWXUHVYDULHVDQGWDNHVLQWRDFFRXQW VHYHUDOIDFWRUVVXFKDVKLVWRULFLQWHJULW\RIDUFKLWHFWXUDO ,WDOLDQDWH VW\OH VHWWLQJ FXOWXUDO DIÀOLDWLRQV IXQFWLRQ DQG DJH 4XHHQ$QQH $JHLVQRWWKHRQO\GHWHUPLQLQJIDFWRULQDEXLOGLQJ·V 9HUQDFXODU*HUPDQLF,QÁXHQFHG KLVWRULF PHULW$EXLOGLQJ RU HQWLUH QHLJKERUKRRG &UDIWVPDQ GRHV QRW QHHG WR EH DVVRFLDWHG ZLWK D SHUVRQ RI $PHULFDQ)RXU6TXDUH KLJKVWDWXVRUKLJKO\RUQDWHH[DPSOHVRIDEXLOGLQJ $UW'HFR W\SH RU VW\OH LQ RUGHU WR EH FRQVLGHUHG IRU RIÀFLDO &RORQLDO5HYLYDO KLVWRULF VWDWXV  1HLJKERULQJ *HUPDQ 9LOODJH LV D JRRGH[DPSOHRIWKLVFRQFHSW0DQ\RILWVVWUXFWXUHV 7KH $YHQXH DQG WKH VXUURXQGLQJ UHVLGHQWLDO DUHD DUH QRW WHUULEO\ RUQDWH RU HODERUDWH DQG PDQ\ RI DOVR H[KLELWV WKHVH DUFKLWHFWXUDO VW\OHV DV ZHOO DV WKHLU KLVWRULF RFFXSDQWV ZHUH *HUPDQ ZRUNHUV DQG ZRUNLQJ FODVV RU 9HUQDFXODU DUFKLWHFWXUH ZLWK ODERUHUV+RZHYHUWKHDUHDLVVLJQLÀFDQWDVDZKROH VRPH *HUPDQLF LQÁXHQFHV VLPLODU WR WKRVH IRXQG EHFDXVH LW DQ H[FHOOHQW FROOHFWLRQ RI YHUQDFXODU LQQHDUE\*HUPDQ9LOODJH7KHVHVWUXFWXUHVKDYH *HUPDQLFDUFKLWHFWXUHDQGUHSUHVHQWVDFXOWXUHWKDW EHHQ FRQVWUXFWHG LQ ERWK IUDPH DQG PDVRQU\ SOD\HGDFRQWULEXWLQJUROHLQWKHVRFLDOFXOWXUDODQG YDULDWLRQV DQG DUH UHODWLYHO\ VLPSOH LQ WKHLU GHVLJQ FRPPHUFLDOKLVWRU\RI&ROXPEXV

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

7KHIROORZLQJSURSHUWLHVKDYHDOUHDG\EHHQLGHQWLÀHG -RH&DUWLQ8VHG)XUQLWXUH $SSOLDQFHV IRUPHU6W LQWKH6RXWKVLGH3ODQRIDVEHLQJHOLJLEOHIRUOLVWLQJ 6WHSKHQV&RPPXQLW\+RXVH RQWKH1DWLRQDO5HJLVWHURI+LVWRULF3ODFHV  %DUWKPDQ$YH  < 5HJLVWHUHOLJLEOH  &ROXPEXV3ODQQLQJ'LYLVLRQ %XFNH\H6WHHO&DVWLQJ&RPSDQ\2IÀFH%XLOGLQJ  3DUVRQV$YH 3DSS\·V3DZQ6KRS VWLOORFFXSLHG" <5HJLVWHUHOLJLEOH  3DUVRQV$YH DW5HHE 2+32KDVLQIR <5HJLVWHUHOLJLEOH  2+32 (QJLQH+RXVH1R 3DUVRQV$YH 3RZHURI3UD\HU  < 5HJLVWHUHOLJLEOH  5HHE$YH  ZLWKDGGLWLRQ <5HJLVWHUHOLJLEOH  2+32&HQWUDO2KLR)LUH0XVHXP  &ROXPEXV3ODQQLQJ'LYLVLRQ

1DWLRQDO5HJLVWHURI+LVWRULF3ODFHV KDYHDFKLHYHGVLJQLÀFDQFHZLWKLQWKHSDVW\HDUVVKDOOQRW 7KH 1DWLRQDO 5HJLVWHU RI +LVWRULF 3ODFHV LV WKH RIÀFLDO OLVW EH FRQVLGHUHG HOLJLEOH IRU WKH 1DWLRQDO 5HJLVWHU RI+LVWRULF RI SURSHUWLHV UHFRJQL]HG E\ WKH IHGHUDO JRYHUQPHQW 3ODFHV+RZHYHUVXFKSURSHUWLHVZLOOTXDOLI\LIWKH\DUHLQWHJUDO DV ZRUWK\ RI UHFRJQLWLRQ IRU WKHLU ORFDO VWDWH RU SDUWVRIGLVWULFWVWKDWGRPHHWWKHFULWHULDRULIWKH\IDOOZLWKLQWKH QDWLRQDO VLJQLÀFDQFH LQ $PHULFDQ KLVWRU\ DUFKLWHFWXUH IROORZLQJFDWHJRULHV DUFKDHRORJ\ HQJLQHHULQJ RU FXOWXUH $OWKRXJK WKH 1DWLRQDO 5HJLVWHU RI +LVWRULF 3ODFHV LV D SURJUDP RI WKH  $ D UHOLJLRXV SURSHUW\ GHULYLQJSULPDU\ VLJQLÀFDQFH 1DWLRQDO3DUN6HUYLFHLWLVDGPLQLVWHUHGDWWKHVWDWHOHYHO IURP DUFKLWHFWXUDO RU DUWLVWLF GLVWLQFWLRQ RU KLVWRULFDO E\HDFKUHVSHFWLYHVWDWH LPSRUWDQFHRU  % D EXLOGLQJ RU VWUXFWXUH UHPRYHG IURP LWV RULJLQDO &ULWHULD IRU (YDOXDWLRQ 7KH TXDOLW\ RI VLJQLÀFDQFH LQ   ORFDWLRQ EXW ZKLFK LV VLJQLÀFDQW SULPDULO\ IRU $PHULFDQKLVWRU\DUFKLWHFWXUHDUFKDHRORJ\HQJLQHHULQJ   DUFKLWHFWXUDO YDOXH RU ZKLFK LV WKH VXUYLYLQJ DQGFXOWXUHLVSUHVHQWLQGLVWULFWVVLWHVEXLOGLQJVVWUXFWXUHV   VWUXFWXUH PRVW LPSRUWDQWO\ DVVRFLDWHG ZLWK D DQG REMHFWV WKDW SRVVHVV LQWHJULW\ RI ORFDWLRQ GHVLJQ KLVWRULFSHUVRQRUHYHQWRU VHWWLQJPDWHULDOVZRUNPDQVKLSIHHOLQJDVVRFLDWLRQDQG  & D ELUWKSODFH RU JUDYH RI D KLVWRULFDO ÀJXUH RI   RXWVWDQGLQJ LPSRUWDQFH LI WKHUH LV QRW DQRWKHU  $ WKDW DUH DVVRFLDWHG ZLWK HYHQWV WKDW KDYH   DSSURSULDWHVLWHRUEXLOGLQJGLUHFWO\DVVRFLDWHGZLWK   PDGH D VLJQLÀFDQW FRQWULEXWLRQ WR WKH EURDG   WKHLUSURGXFWLYHOLIHRU  SDWWHUQVRIRXUKLVWRU\RU  ' DFHPHWHU\WKDWGHULYHVLWVSULPDU\VLJQLÀFDQFHIURP  % WKDW DUH DVVRFLDWHG ZLWK WKH OLYHV RI SHUVRQV   JUDYHVRISHUVRQVRIWUDQVFHQGHQWLPSRUWDQFHIURP  VLJQLÀFDQWLQRXUSDVWRU   DJH IURP GLVWLQFWLYH GHVLJQ IHDWXUHV RU IURP  & WKDWHPERG\WKHGLVWLQFWLYHFKDUDFWHULVWLFVRID   DVVRFLDWLRQZLWKKLVWRULFHYHQWVRU   W\SHSHULRGRUPHWKRGRIFRQVWUXFWLRQRUWKDW  ( D UHFRQVWUXFWHG EXLOGLQJ ZKHQ DFFXUDWHO\   UHSUHVHQWWKHZRUNRIDPDVWHURUWKDWSRVVHVV   H[HFXWHGLQDVXLWDEOHHQYLURQPHQWDQGSUHVHQWHG   KLJKDUWLVWLFYDOXHVRUWKDWUHSUHVHQWDVLJQLÀFDQW LQ D GLJQLÀHG PDQQHU DV SDUW RI D UHVWRUDWLRQ   DQG GLVWLQJXLVKDEOH HQWLW\ ZKRVH FRPSRQHQWV   PDVWHU SODQ DQG ZKHQ QR RWKHU EXLOGLQJ RU   PD\ODFNLQGLYLGXDOGLVWLQFWLRQRU   VWUXFWXUHZLWKWKHVDPHDVVRFLDWLRQKDVVXUYLYHGRU  ' WKDW KDYH \LHOGHG RU PD\ EH OLNHO\ WR \LHOG  ) D SURSHUW\ SULPDULO\ FRPPHPRUDWLYH LQ LQWHQW LI   LQIRUPDWLRQLPSRUWDQWLQSUHKLVWRU\RUKLVWRU\   GHVLJQ DJH WUDGLWLRQ RU V\PEROLF YDOXH KDV   LQYHVWHGLWZLWKLWVRZQKLVWRULFDOVLJQLÀFDQFHRU &ULWHULDFRQVLGHUDWLRQV2UGLQDULO\FHPHWHULHVELUWKSODFHV  * DSURSHUW\DFKLHYLQJVLJQLÀFDQFHZLWKLQWKHSDVW RU JUDYHV RI KLVWRULFDO ÀJXUHV SURSHUWLHV RZQHG E\ \HDUVLILWLVRIH[FHSWLRQDOLPSRUWDQFH UHOLJLRXV LQVWLWXWLRQV RU XVHG IRU UHOLJLRXV SXUSRVHV VWUXFWXUHV WKDW KDYH EHHQ PRYHG IURP WKHLU RULJLQDO )RUPRUHLQIRUPDWLRQRQ1DWLRQDO5HJLVWHURI+LVWRULF3ODFHV ORFDWLRQV UHFRQVWUXFWHG KLVWRULF EXLOGLQJV SURSHUWLHV FULWHULDFRQWDFWWKH2KLR+LVWRULF3UHVHUYDWLRQ2IÀFH SULPDULO\ FRPPHPRUDWLYH LQ QDWXUH DQG SURSHUWLHV WKDW

1BHF
" 3K\VLFDO2ULHQWDWLRQ KLVWRULF DHVWKHWLFV RU DQ XUEDQ UHQHZDO PLQGVHW 3DUVRQV$YHQXHDQGLWVWKUHH´VXEQHLJKERUKRRGVµ WKDW LV PRUH FRQVLVWHQW ZLWK VXEXUEDQ VSUDZO ZLOO ODUJHO\GHYHORSHGDVDSHGHVWULDQRULHQWHGPL[HG FRQWLQXHWRRQO\SXW3DUVRQV$YHQXHRQDSDWK XVH HQYLURQPHQW  :LWK WKH ZLGHQLQJ RI 3DUVRQV RIDQHLJKERUKRRG ZLWKRXW DQ LGHQWLW\ SRVLWLYH $YHQXH RYHU WLPH WR DFFRPPRGDWH ODUJHU LPDJHDQGZLWKPHGLRFUHUHVXOWVLQWKHDUHDRI YROXPHV RI YHKLFXODU WUDIÀF DQG WKH ERRPLQJ HFRQRPLFGHYHORSPHQWWKDWEULQJVQHZPDUNHW PDQXIDFWXULQJEDVHWKDWGHYHORSHGDURXQGWKH RSSRUWXQLWLHVWKDWKDYHEURDGDSSHDODVZHOODV GLVWULFW·V SHULSKHU\ UHVXOWHG LQ PRUH DQG PRUH WKRVHWKDWVHUYHWKHORFDOPDUNHWVHJPHQWV ZRUNHUV FRPLQJ LQWR WKH GLVWULFW  7KH QHHG WR WUDQVIRUP WKH$YHQXH LQWR DPRUH DXWRPRWLYH 7KH ZDONLQJ WRXU LQYHQWRU\ RI NH\ VWUXFWXUHV RI RULHQWHG DSSHDUDQFH HQVXHG DQG KDV UHVXOWHG KLVWRULFYDOXHLQFOXGHGWKHIROORZLQJH[DPSOHV LQ LQDSSURSULDWH VHWEDFNV ODUJH JDSLQJ YDFDQW ORWVDQG´FKDLQµVW\OHDUFKLWHFWXUHDQGVLJQDJH WKDW KDV JLYHQ 3DUVRQV $YHQXH D ´VHHG\µ DQG GLVKHYHOHGDSSHDUDQFH

7KH WKUHH VXE QHLJKERUKRRGV WKDW FRPSULVH 3DUVRQV $YHQXH FRQWDLQ VLPLODU DUFKLWHFWXUDO VW\OHV ZLWK VRPH LQ EHWWHU VWDWHV RI SUHVHUYDWLRQ WKDQ RWKHUV  *RRG H[DPSOHV RI FRPSDWLEOH LQÀOO GHYHORSPHQW DQG V\PSDWKHWLF IDoDGH UHQRYDWLRQV DUH DOVR SUHVHQW EXW WKH\ DUH IDU RXWQXPEHUHG E\ WKH H[DPSOHV RI EDG VLJQDJH EDG ODQG SODQQLQJ DQG EDG GHVLJQ LQ DFWLRQ +RZHYHU JRRG HOHPHQWV VWLOO H[LVW DORQJ WKH $YHQXHWKDWFRXOGEULQJEDFNDPRUHFRKHVLYH DQGDWWUDFWLYHHOHPHQWWRWKH6RXWKVLGHWKDWZLOOLQ WXUQDVVLVWLQDVWUDWHJ\RIHFRQRPLFGHYHORSPHQW 3DUVRQV DVZHOO

$ FHQWUDOL]HG´GRZQWRZQµ IRU 3DUVRQV$YHQXH DSSHDUVWREHORFDWHGLQWKHFHQWHURIWKHVWUHHW DQG IRFXVHG DURXQG WKH IRUPHU 6FKRWWHQVWHLQ·V 'HSDUWPHQW6WRUHZKLFKLVDOVRRQHRIWKHPRVW VXEVWDQWLDODQGVLJQLÀFDQWVWUXFWXUHVLQWKHDUHD DQG RQH WKDW DIIRUGV VRPH YHU\ LQWHUHVWLQJ DGDSWLYHUHXVHSRVVLELOLWLHVDVZHOO+RZHYHUWKH GLVWULFW GLVSOD\V VHYHUDO VPDOO VXE ´GRZQWRZQµ DUHDVWKDWKROGUHYLWDOL]DWLRQSRWHQWLDODVZHOO

.H\6WUXFWXUHV .H\ VWUXFWXUHV DQG SRUWLRQV RI WKH $YHQXH WKDW SRVH YLDEOH DQG LQWHUHVWLQJ RSSRUWXQLWLHV IRU UHYLWDOL]DWLRQ DQG FRXOG EH FRQVLGHUHG DQFKRU EXLOGLQJV RU ´WHVW EORFNVµ WKDW ZRXOG VHUYH DV FDWDO\VWV ZKHQ FRRUGLQDWHG ZLWK D ODUJHU UHYLWDOL]DWLRQ HIIRUW WKDW LV FRPSUHKHQVLYH DQG LQFUHPHQWDO LQ QDWXUH 6XFK D PRGHO RI UHYLWDOL]DWLRQPD\EHEHVWEHIRXQGLQWKH1DWLRQDO 7UXVWIRU+LVWRULF3UHVHUYDWLRQ·V0DLQ6WUHHW3URJUDP RUWKH(OP6WUHHW3URJUDPFUHDWHGE\WKH6WDWH RI3HQQV\OYDQLDZLWKVLPLODUIRFXVDVWKH1DWLRQDO 0DLQ6WUHHW3URJUDPEXWLVVLJQLÀFDQWWRLWVXVHRI 6WDWHIXQGLQJ5HJDUGOHVVWKHLQFRQVLVWHQWGHVLJQ SUDFWLFHVWKDWKDYHKDGQRUHJDUGWRSODFHPHQW ORFDWLRQ PDWHULDOV VLJQDJH ODQGVFDSLQJ 3DUVRQV 6(&RUQHURI5HLQKDUG

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

DQGDOOQHLJKERUKRRGFKXUFKHVDQGVFKRROV EXLOW DVFKXUFKHV VFKRROV

3DUVRQV EXLOW

3DUVRQVFLUFD 3DUVRQV EXLOW

3DUVRQVFLUFD 3DUVRQV VRXWKRI%DUWKPDQ %XLOW

1BHF
" 1RUWK2I5HHE

3DUVRQVEXLOW 3DUVRQVEXLOW

3DUVRQVEXLOWFLUFD

1RUWKRI5HHE

3DUVRQVEXLOW 3DUVRQVEXLOW 6(&RUQHURI,QQLV

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

,QFRPSDWLEOH)DoDGHV,QDSSURSULDWH,Q)LOO 2QH RI WKH PDLQ REVWDFOHV WKH 3DUVRQV $YHQXH GLVWULFWIDFHVDUHLQDSSURSULDWHIDoDGHUHQRYDWLRQV WKDWXVHVOHVVHUPDWHULDOVDQGLQFRQVLVWHQWGHVLJQ SULQFLSOHVWKDWGUDPDWLFDOO\DOWHUWKHDSSHDUDQFH RI KLVWRULF VWUXFWXUHV DORQJ WKH $YHQXH ,QDSSURSULDWH LQÀ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À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

3DUVRQV%XLOW

1BHF
" 1HJOHFWDQG'HPROLWLRQ GLVWULFW LWVHOI WR EH HGXFDWHG DERXW SODQQLQJ 3URSHUW\ QHJOHFW DQG GHPROLWLRQ LV \HW DQRWKHU KLVWRULF SUHVHUYDWLRQ DGDSWLYH UHXVH DQG WKH LVVXH WKDW IDFHV WKH $YHQXH 2I FRXUVH WKH RYHUDOOIDFHWVRIUHYLWDOL]DWLRQLQJHQHUDOLQFOXGLQJ À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ÀQDQFLDO RI WKH PRVW VXFFHVVIXO H[DPSOHV LQ WKH FRXQWU\ LQFHQWLYHV DQG´YROXQWHHU ODERUµ WKDW ZRXOG EH LQ ZKLFK &ROXPEXV DQG 3DUVRQV $YHQXH FRXOG WDUJHWHGWRWKHVSHFLÀFQHHGVRIQHLJKERUKRRG SDWWHUQ LWVHOI LV WKDW RI WKH )XQG IRU /DQGPDUNV ,QGLDQDSROLV3URSHUWLHVLQ,QGLDQDSROLV2YHUWKHODVW &RGHV  $Q XQGHUVWDQGLQJ RI FRGHV DQG TXDUWHURIDFHQWXU\WKH)/,3IXQGRI,QGLDQDSROLV DOORZDQFHV XQGHU %XLOGLQJ &RGHV WKDW PDNH RSHUDWHG E\ +LVWRULF /DQGPDUNV )RXQGDWLRQ RI DGDSWLYH UHXVH SRVVLEOH  &KDSWHU  RI WKH ,QGLDQDSROLV KDV HQMR\HG WUHPHQGRXV VXFFHVV 6WDQGDUG %XLOGLQJ &RGH ZRUNV ZLWK KLVWRULF RU UHQRYDWLQJ VRPH RI WKDW FLW\·V PRVW GLODSLGDWHG H[LVWLQJVWUXFWXUHVDQG\HWGRHVQRWFRPSURPLVH VWUXFWXUHV DQG WULJJHULQJ WKH WUDQVIRUPDWLRQ RI VDIHW\EXWEXLOGLQJ FRGHRIÀFLDOV VHOGRPXWLOL]HV VRPH WKDW FLW\·V PRVW EOLJKWHG DUHDV LQWR VRPH WKLV VHFWLRQ RI WKH &RGH  (QWLUH 6WDWHV VXFK DV RIWKHFLW\·VPRVWGHVLUHGSODFHVDQGUHDOHVWDWH 1HZ-HUVH\DQG0DU\ODQGKDYHLQLWLDWHGVSHFLÀ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À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

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

0DUNHW6HJPHQW VKRXOG FRQWLQXH WR UHWDLQ DQG HQKDQFH ZRUNLQJ 3DUVRQV$YHQXHLVLQSRVLWLRQLWVHOIWRIXUWKHUUHÀQH IDPLOLHVDVSDUWRIWKH3DUVRQV$YHQXHG\QDPLF LWV PDUNHW VHJPHQW DQG \HW FRQWLQXH WR EH D ORFDWLRQ WR VHUYHWKHQHHGV RI LWVORFDO PDUNHW 3URIHVVLRQDOV :LWK WKH SUR[LPLW\ WR GRZQWRZQ DUHD  +RZHYHU ZLWK WKH H[LW RI PDQ\ RI WKH QLJKW OLIH FXOWXUDO DPHQLWLHV 268 DQG &KLOGUHQV QHLJKERUKRRG·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´FUHDWLYH FODVVµ 7KLV JURXS RI WKH3DUVRQV$YHQXHDUHDIRUKLVWRULFUHKDELOLWDWLRQ SHRSOH WHQG WR EH \RXQJ WR PLGGOH DJHG DQG FRPSDWLEOH LQÀ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ÀW ZLWKLQ WKH YLVLRQ DQG W\SHRIVSDFHDYDLODEOHWKDWZRXOGEHDWWUDFWLYH VWUDWHJ\ IRU WKH QHLJKERUKRRG +RZHYHU WKH WR D YDULHW\ RI DUWLVWLF PHGLXPV  $UWLVWV WKDW DUH QHLJKERUKRRG VKRXOG WU\ DQG SDUWQHU DQG PRUH HVWDEOLVKHG DQG GR QRW QHFHVVDULO\ À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´$UWLVW5HORFDWLRQ KLVWRULFUHVRXUFHVORFDWHGZLWKLQ3DUVRQV$YHQXH 3URJUDPµ LV FXUUHQWO\ EHLQJ LPSOHPHQWHG LQ DQG WR GHYHORS VRPH RI WKH SRWHQWLDO PDUNHW 3DGXFDK.HQWXFN\2IFRXUVHUHFUXLWLQJVXFKD RSSRUWXQLWLHV RXWOLQHG KHUH WKH $YHQXH VKRXOG VSHFLDOL]HGSRRORISHRSOHWRWKHQHLJKERUKRRG VHHNWRGHYHORS´WHVWEORFNVµZKHUHVRPHRIWKH FRXOG WULJJHU DGGLWLRQDO LQYHVWPHQW DQG UHODWHG FRQFHSWV RXWOLQHG LQ WKH SODQQLQJ GRFXPHQW EXVLQHVVHV WR WKH $YHQXH VXFK DV JDOOHULHV FRXOGEHLPSOHPHQWHGDQGVHUYHDVDFDWDO\VWIRU UHVWDXUDQWVDQGDUWLVWVXSSOLHV QHLJKERULQJHQGHDYRUVDVZHOO([DPSOHVRIWHVW EORFNVZRXOGEHWDUJHWLQJIDoDGHLPSURYHPHQWV 6HQLRUV :LWKWKHDJLQJEDE\ERRPHUSRSXODWLRQ RU GHYHORSLQJ DQ ´DUWLVW URZµ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

1BHF
" 5HVRXUFHVDQG([DPSOHV 0RUHLQIRUPDWLRQPD\EHIRXQGRQWKHZHEE\ VHDUFKLQJ´3DGXFDK$UWLVW5HORFDWLRQ3URJUDPµ $576SDFH $576SDFHLVDQRWIRUSURÀWRUJDQL]DWLRQ WKDW KDV GHYHORSHG RU DVVLVWHG QXPHURXV 7KH1DWLRQDO 7UXVW IRU +LVWRULF3UHVHUYDWLRQ 7KH FRPPXQLWLHV DFURVV WKH FRXQWU\ LQ GHYHORSLQJ 1DWLRQDO 7UXVW IRU +LVWRULF 3UHVHUYDWLRQ LV WKH RQO\ ODUJH VFDOH DUWLVW KRXVLQJ SURMHFWV HLWKHU DV DQ QDWLRQZLGHQRWIRUSURÀWRUJDQL]DWLRQGHGLFDWHG DGYLVRU RU DV D GHYHORSHU /HDGLQJ 1RQ 3URÀW WR WKH SUHVHUYDWLRQ RI $PHULFD·V FXOWXUDO DQG 5HDO(VWDWH'HYHORSHUIRUWKH$UWV KLVWRULFUHVRXUFHV7KH7UXVWKDVVRPHJUDQWIXQGLQJ  ‡3DUWQHUV ZLWK ORFDO OHQGHUV GHYHORSPHQW SURJUDPV PRVWO\ UHODWHG WR SODQQLQJ EXW DOVR   DJHQFLHVDQGRWKHUUHVRXUFHV PDLQWDLQV DZHDOWK RI LQIRUPDWLRQDQG FRQWDFWV  ‡$OVR FRQVXOWLQJ VHUYLFHV DQG SURSHUW\ WKDWZRXOGEHYHU\KHOSIXOUHODWHGWRGHVLJQLQÀOO  PDQDJHPHQW DQGWKHHFRQRPLFVRIPDNLQJKLVWRULFUHKDELOLWDWLRQ 0RUHDERXW$576SDFH·VZRUNPD\EHVHHQWKURXJK SURMHFWV HIIHFWLYH  0RUH LQIRUPDWLRQ DW ZZZ WKHLUZHEVLWHDWZZZDUWVSDFHSURMHFWVRUJ QWKSRUJ 7KH 0LGZHVW 5HJLRQDO )LHOG 2IÀFH WKDW VHUYHV2KLRLVORFDWHGLQ&KLFDJR +LVWRULF /DQGPDUNV )/,3  +LVWRULF/DQGPDUNV )RXQGDWLRQRI,QGLDQDLVRQHRIWKHPRVWSUHVWLJLRXV 7KH1DWLRQDO3DUN6HUYLFH7KH1DWLRQDO3DUN6HUYLFH KLVWRULF SUHVHUYDWLRQ JURXSV LQ WKH 8QLWHG 6WDWHV LVKRXVHGXQGHUWKH6HFUHWDU\RI,QWHULRUZKLFKLV DQGRYHUWKHSDVW\HDUVKDYHGHYHORSHGDQ DOVRWKHNHHSHURIWKH1DWLRQDO5HJLVWHURI+LVWRULF HIIHFWLYH UHYROYLQJ IXQG WKDW KDV WULJJHUHG WKH 3ODFHV 2QH RI WKH PDQ\ KHOSIXO UHVRXUFHV WKH UHYLWDOL]DWLRQRIVRPHRI,QGLDQDSROLV·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ÀOO0RUHLQIRUPDWLRQFDQEHIRXQG OHDÁHWVDQGRWKHUKHOSIXOVHUYLFHVRIWKH1DWLRQDO RQWKHZHEDWZZZKLVWRULFODQGPDUNVRUJ 3DUN 6HUYLFH PD\ EH GRZQORDGHG IURP WKHLU ZHEVLWH ‡)2&86   ´)RVWHULQJ&RPPHUFLDO8UEDQ6WUDWHJLHVµ 7KH 2KLR +LVWRULF 3UHVHUYDWLRQ 2IÀFH  7KH 2KLR  ‡3DUWQHUVKLSV EDVHG RQ 1HLJKERUKRRG %DVHG +LVWRULF 3UHVHUYDWLRQ 2IÀFH VKRXOG EH DEOH WR   &RPPXQLW\'HYHORSPHQW&RUSV SURYLGH PRUH WHFKQLFDO LQIRUPDWLRQ WKDW FRXOG  ‡ &RPPHUFLDO &RUULGRU &RQVRUWLXPV  EHKHOSIXOLQWHUPVRIGHWHUPLQLQJSURSHUWLHVWKDW 1HLJKERUKRRGVHDFK DUH HOLJLEOH IRU LQFOXVLRQ WR WKH 1DWLRQDO 5HJLVWHU  ‡+LUHG&RPPHUFLDO&RUULGRU3URMHFW0DQDJHUV RI +LVWRULF 3ODFHV DQG DVVLVWLQJ LQ FRPSOHWLQJD  ‡)DoDGH,PSURYHPHQW5HEDWH3URJUDP IXOOLQYHQWRU\RISURSHUWLHVDORQJ3DUVRQV$YHQXH XWLOL]LQJ WKH 2KLR +LVWRULF ,QYHQWRU\ )RUPV 2+,  3DGXFDK $UWLVW 5HORFDWLRQ  7KLV HIIRUW KDV EHHQ 7KH 2+32 VKRXOG EH DEOH WR SURYLGH WHFKQLFDO WUDQVIRUPLQJ RQH RI 3DGXFDK .HQWXFN\·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‡/RFDOEDQNVLQFHQWLYHOHQGLQJWRDUWLVWVEX\LQJ D ZHDOWK RI LQIRUPDWLRQ UHODWHG WR GRZQWRZQ KRPHV DQG QHLJKERUKRRG FRPPHUFLDO UHYLWDOL]DWLRQ  ‡*URXS+HDOWK,QVXUDQFH UDQJLQJIURPSDUNLQJKRXVLQJUHWDLOUHFUXLWPHQW ‡-RLQW0DUNHWLQJ 3URPRWLRQV KLVWRULFEXLOGLQJUHKDELOLWDWLRQLQÀOOGHVLJQWUDIÀF  ‡3UHVHUYDWLRQ (QWHUSULVH=RQHWD[LQFHQWLYHV FDOPLQJVWUHHWVFDSHVDQG]RQLQJDQGSODQQLQJ ‡%XVLQHVVDVVLVWDQFH WRQDPH IHZ7KH1DWLRQDO 7UXVW DOVR FRQWDLQV VHYHUDO ÀQDQFLDO LQFHQWLYH SURJUDPV DV ZHOO IRU

1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

UHYLWDOL]DWLRQSODQQLQJDQGKLVWRULFSUHVHUYDWLRQ %HWKOHKHP3HQQV\OYDQLD/RFDWHGLQWKH/HKLJK 7KH5HJLRQDO2IÀFHWKDWVHUYHV2KLRLVORFDWHGLQ 9DOOH\ RI (DVWHUQ 3HQQV\OYDQLD %HWKOHKHP &KLFDJR 7KH 1DWLRQDO 7UXVW DQG 1DWLRQDO 0DLQ 3HQQV\OYDQLDLVUHGHÀQLQJLWVHOIDIWHUWKHFORVXUHRI 6WUHHW&HQWHUPD\EHFRQWDFWHGYLDWKHLUZHEVLWH WKH%HWKOHKHP6WHHO0LOOV'RZQWRZQ%HWKOHKHP DWZZZQWKSRUJ DQGWKHDGMRLQLQJVWHHOPLOODQGLQGXVWULDOSURSHUWLHV DUH H[SHULHQFLQJ DQ DPD]LQJ UHQDLVVDQFH WKDW 'RZQWRZQ2KLR+HULWDJH2KLR 'RZQWRZQ2KLR VKRXOGEHHPXODWHGE\RWKHUKHDYLO\LQGXVWULDOL]HG +HULWDJH2KLRLVWKHVWDWHZLGHQRWIRUSURÀWJURXS DUHDV WKDW KDYH JRQH E\ ZD\ RI WKH SDVW WKDWDVVLVWVLQWUDLQLQJDQGLPSOHPHQWLQJWKH0DLQ %HWKOHKHP·V GRZQWRZQ DQGIRUPHU VWHHO PLOO 6WUHHW 3URJUDP WKURXJKRXW WKH 6WDWH 0XFK OLNH DUHDV DUH À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ÀUVWVWDWHDQGRQHRIWKHIHZWRGD\WKDWKDV DYDLODEOH IRU FRPPHUFLDO GLVWULFW UHYLWDOL]DWLRQ HQDFWHGD5HKDE&RGH7KH&RGHFXWVWKURXJK DQG KLVWRULF SUHVHUYDWLRQ W\SH SURMHFWV LQ 2KLR WKH UHG WDSH DQG PDQ\ EDUULHUV PRUH FRPPRQ VXFKDVWKH&'%*%ORFN*UDQW3URJUDPWKURXJK EXLOGLQJ FRGHV SODFH RQ H[LVWLQJ VWUXFWXUHV 2KLR 'HSDUWPHQW RI 'HYHORSPHQW DQG WKH DQG RIWHQ FDQ PDNH WKHP YHU\ GLIÀFXOW IRU 7UDQVSRUWDWLRQ (QKDQFHPHQW 3URJUDP WKURXJK UHKDELOLWDWLRQ7KH1HZ-HUVH\5HKDE&RGH'2(6 WKH2KLR'HSDUWPHQWRI7UDQVSRUWDWLRQWRQDPH 1RW VDFULÀ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À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‡,QWHUQDWLRQDO0$'$$XWR6KRZ FRPPLWPHQWRI6WDWHIXQGLQJIRULQQRYDWLYHJUDQW  ‡6WDUWHG ZLWK /3 RI WHQDQWV ZKR RFFXSLHG D SURJUDPVWDUJHWHGWRHYHQSULYDWHKRPHRZQHUV EXLOGLQJLQWKHGLVWULFW LV MXVW RQH RI WKH LWHPV WKDW LV VHWWLQJ WKH SDFH  ‡0$36SURMHFWVWRWDO0LOOLRQVLQFH·V IRU WKH (OP 6WUHHW 3URJUDP (OP 6WUHHW LV QRZ ‡2.,QWHUQDWLRQDO)LOP&RXQFLO EHLQJ LPSOHPHQWHG LQ  QHLJKERUKRRGV DFURVV WKH &RPPRQZHDOWK RI3$ DQG DQRWKHU  FRPPXQLWLHV DUH FXUUHQWO\ HQJDJHG LQ 3ODQQLQJ IRU(OP6WUHHW3URJUDPV

1BHF
" 1BHF
" (SFBUFS
1BSTPOT
"WFOVF
DUHDYLVLRQSODQ

$PNNVOJUZ
*OQVU

1BHF
" Greater Parsons Avenue area vision plan

Vision Session July 28th

1. What characteristics / features within the community do you feel are sacred? x Lincoln School … save, adaptive use, incubator space x Diverse social-economic and ethnic community x Safe place to live and work x Unique … older historic housing x Keep the kids here … good schools x Don’t displace the people that are here x Stop blight … retain families, improve connection to community x Parsons remains the HUB of activity build upon HUB x Close proximity to everything, good access to freeway system

2. What do you want changed? x The way City employees think about the South-side x Perception of South-side in general x Safety, prostitution, drugs, shootings/violent crime, illegal dumping (contractors) x Lots of small businesses off of Parsons Ave. that need to be organized x There is buying power … need places to spend dollars x Get rid of vacant lots and houses, abandoned …boarded up housing x How safe Parsons Ave. depends upon how safe the neighborhood is x Need more lighting (esp. allies) x Too many small stores selling cigarettes, alcohol and drug paraphernalia x Clean it up, sweep the streets, get rid of big trash cans x Don’t get the same level of services as other Columbus neighborhoods x Improve code enforcement x Better understanding (recognition) of community assets and strengths x Need jobs … recognize the changing economy x Bigger library x Need check cashing facilities x Non-functional businesses x Additional facilities (resources) for community groups (learning center, settlement house, etc.) x More owner occupants of commercial structures (too many absentee landlords x Permits issued without community notification … need to enforce law x Lack of an established area planning commission x Poor traffic patterns, bob-and-weave, enforce speed limits

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

x Need more parking (more lots, add turning lanes, turn signals, allow parallel parking 24 hours per day)

3. Vision in 10 Years x Strong E. D. near an improved 104/Parsons Ave interchange x Utilize architectural resources x Proper commercial zoning … hold people accountable x Improved building code x Improved code enforcement, better trained staff, staff assigned to overlay district x Someplace to shop-outlet businesses, basic essential services, transition from large buildings to small shops, middle and small box national chains x Survey where people on South-side shop, determine where money is being spent, examine purchasing power within the community x Quality shopping-safe well lit x Utilize lot at Frebis/Lockbourne x More mixed uses x People bringing $ into the community x Remodeled SS settlement house x Improved parking around Post Office x Facilities for Sr. citizens x Enhanced parks, facilities for older children, bike paths, walking paths, neighborhood type facilities x Businesses with outside seating x Dry cleaning, drug stores, video stores, extended hours stores x Community center (possible reuse of building on Ohio/Newton x Activities for youth x Enhance Driving Park x New housing construction, housing has been fixed up x New jobs x New retailers, office buildings, hotel x Good workforce x Capitalize upon new intermodal facility at Rickenbacker x Increased homeownership and business ownership x Improved transportation to jobs x Utilize businesses that are in the SS x Improved Safety x Changed (modified) perception of the SS by outsiders and City employees

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Results of the August 3, 2005 Visioning Session Conducted with PAMA Trustees

1. What are the attributes of the community that you want to see preserved? • Library • Diversity of neighborhoods • Historic buildings – don’t tear down the entire Southside • Cohesive unity within neighborhoods and among merchants. Merchants have established a good relationship with the community • Unity among civic associations and interest groups • Sense of community

2. What has the community done to inhibit sound business investments and expansion? • Urban commercial zoning overlay o Has inhibited growth o Overlay hurts start-up businesses o Parsons Avenue is not another Short North o City not flexible when administering overlay o Curb cuts not easy to obtain • Politics within the community • City staff and administrators not customer-friendly o Selective code enforcement • Lack of a developer taking an interest in the area • No plan to get behind and support • No money to implement ideas/vision • Banks have turned their backs on Parsons Avenue • An insurance company dropped a business’ policy when it moved to Parsons Avenue • Lack of community investment • Perceptions about Parsons Avenue area o Crime • Closing of factories and retail stores/lack of retail • Parsons Avenue is like a freeway. Need to get people to stop and shop.

3. What can be done to improve investment opportunities for commercial and industrial development? • Improve image of Parsons Avenue o Elected officials o Media • Work with Columbus Urban Growth on property redevelopment o Schottenstein property and surrounding area. CUG has options on old IGA/A&P site • More police presence

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

o Liked bicycle patrols o Substation in community • Better/targeted code enforcement o A lot of absentee landowners o Code enforcement officers go after people that are easy to track down • Create job opportunities • Existing businesses need to get a positive attitude • Need more businesses that cater to residents and that attract people to Parsons Avenue o Need more nighttime businesses o Need something like North Market or old central market • Capitalize on assets – Schiller Park, proximity to German Village • Improved marketing of the area • Need a master developer

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Results of the August 4, 2005 PAMA Visioning Session

1. What are the attributes of the community that you want to see preserved? • Historic buildings • Small businesses • Neighborhood that supports families of all sizes and ages (young/old) • Maintenance of healthy, small buildings • Small business opportunities • Keep a diverse community. Don’t push out people that have supported the neighborhood.

2. What has the community done to inhibit sound business investments and expansion? • Parking ban imposed along Parsons Avenue from 4-6 pm hurts small businesses. • Parsons Avenue is like a freeway. • Boarded up houses draw people away. • Not sure who to contact to purchase boarded-up homes. • Negative press about Parsons Avenue. • Banks don’t support neighborhoods. • Parsons Avenue businesses too scattered.

3. What can be done to improve investment opportunities for commercial and industrial development? • Maintain what exists. Currently people leave the neighborhood for shopping. • Need to know what the community will support. Neighborhood won’t support high priced businesses. Businesses should be geared toward the working man. • Make the community attractive. • Keep it safe – lighting, better police coverage, visible police presence – go back to street cops. • Don’t turn Parsons Avenue into a fast food freeway. • Sensitive design standards for new buildings • Better marketing of Parsons Avenue corridor. • Tap into activity into German Village. Determine what Parsons Avenue can offer. • Parsons Avenue needs to be brought back to a neighborhood. Now it is just a thoroughfare. • Work with the banks, etc. to provide help in renovating homes – low interest loans. • Better code enforcement on properties owned by absentee landlords. • More flexibility from City/code enforcement. More customer-friendly. • Maintain a database of vacant/available sites for development. • Get media involved - positive promotion of Parsons Avenue area. • Construct mixed-use and mixed income projects. • Create a draw that would attract people from the outside to Parsons Avenue – something unique. Make Parsons Avenue a destination location.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

• Break Parsons Avenue down into smaller pieces and look at how they all fit together. • More retail – department store like Target or Kohl’s needed. • A lot of undeveloped land left on the Southside. Look at the natural/environmental aspects of land development.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Ms. Boumis of Burns, Bertsch & Harris, Inc. facilitated a meeting with the members of the Reeb Hosack Planning Committee on September 13, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible. x Increased homeownership x Increased sense of safety and well-being. People in the neighborhoods need to feel safe or Parsons Avenue will not feel safe. x More housing for seniors. Look at Innis/Parsons lots as a possible location (1805 Parsons) x Better street lighting. x Better street signs. x Create in other communities the feeling of safety along Parsons Avenue. Positive perception of the area. x Jobs in the community. A variety of employment opportunities. x Reuse of vacant industrial buildings on Marion Road. x More retail/commercial opportunities. Examples given include banks, grocery store, restaurants/diners (not fast food), theater, ice cream parlor, store like Schottensteins where you can buy clothes and household items, Tim Horton’s, Starbucks (coffee shop/businesses where people can congregate), well-lit gas station with a mini-mart. These areas should be accessible to the neighborhood. Many seniors do not have cars. Commercial areas should be pedestrian friendly x Bus stop shelters x Improved street maintenance x Better parking/signage for on-street parking x Alleys better maintained/cleaned. x Sidewalks extended/repaired x Historic buildings maintained and reused x Old A&P site re-used x More services for seniors x Updated look to Parsons Avenue – booming like it used to be x Unique businesses – things that draw people here x More police in the area – in cars and on foot x No more second hand appliance stores and no more liquor stores x No more slumlords. Properties cleaned up. x No more boarded up houses. Banks refuse to take responsibility for maintenance. They do not put houses in their name when they foreclose.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

2. What can the City do to ensure that your vision becomes reality? (All of the ideas presented were discussed by the participants. However, participants were asked to prioritize these items. The number in parentheses represents the number of votes each item received.) x More police support o Community policing station (at least 2) in the neighborhood(s); near the fire station is an ideal location. Similar to community policing stations in Linden area. (25) x Get rid of drug activity through concentrated, continuous police involvement (19) x Cut through the red tape/process involved with getting things done (17) o Receivership program o Weed abatement o Code enforcement x Code enforcement needs more authority to shut down houses that are in violation (12) x Help property owners clean up property – money/resources (11) x Create better incentives to attract businesses to the area (10) x Work with developers to redevelop City owned properties currently vacant and boarded up (7) x Traffic calming through neighborhoods (6) x Don’t permit any more liquor stores (6) o Stricter guidelines – clean them up o Shut down stores in violation x Tow junk/inoperable vehicles off streets (4) x More parks/natural areas for neighborhoods (3) x Get rid of gangs in parks/better lighting (2) o SE Lions Park x Work with neighborhoods to secure funding for projects – staff support (2) x Property cleaned up – homeowners taxed (1) x Better enforce traffic laws – truck traffic on Barthman Street x Provide trash containers for households. Get rid of dumpsters (0) x Better street lighting (0) x Sell boarded up properties. Maintain weeds and get rid of trash on these properties. (0) x Condemn abandoned houses (0) x Clean streets (0) x Enforce curfew (0)

3. What can the community do? x Continue looking for grants for park improvements/housing renovations and other neighborhood programs x Continue to assist in the maintenance of community spaces such as parks x Continue to advertise the positives of the neighborhoods/Parsons Avenue x Begin or continue promotional events and festivals such as the Lawn and Garden Tour x Maintain relationships with Columbus officials, Pride Center. Attend meetings at City Hall.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

x Sponsor/participate in neighborhood clean-ups x Support Parsons Avenue revitalization efforts x Work to change City policies that negatively affect the neighborhoods/Parsons Avenue. Civic associations/groups should band together. x Get City Council members/Mayor to tour area

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Dianne Harris of Burns, Bertsch & Harris, Inc. facilitated a meeting with the members of the Schumacher Place Civic Association on September 21, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years-positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible. ƒ Parsons Avenue becomes a positive edge (component) of the neighborhood (Similar to the revitalizing of Clintonville) ƒ More grass and green space; less pavement ƒ More continuity in design on Parsons Ave. (businesses) ƒ Underground power lines ƒ Retain historic architecture (small “h”; not just Register nominated structures) ƒ Owners maintain properties & grounds well ƒ A comfortable, pleasant area for walking (free of threatening elements) ƒ Continuous flow of buildings on Parsons Ave., with few parking lots interrupting ƒ More shopping attractions with an eclectic business mix (desirable businesses) ƒ East side of Parsons Ave. also a comfortable pleasant place to walk ƒ Not subsumed by large, mega-businesses (including Children’s Hospital and car dealerships to North) ƒ Wider sidewalks on Parsons Ave. in shopping districts (separation from traffic, and room for strolling & looking) ƒ More community involvement on the “follow through” of plan ƒ Adhere to the Urban Commercial Overlay standards ƒ Create a “nucleus” a focal point- town center- in the corridor ƒ Create a signature civic event (annual, regional draw, using this town center) ƒ Create a fresh identity ƒ Parsons Ave. business and service mix serves the demographics of both sides of the corridor; creating natural interactions, instead of being a dividing line.

2. What can the City do? To ensure that your vision becomes reality? (All of the ideas presented were discussed by the participants. However, participants were asked to prioritize these items. The number in parentheses represents the number of priority points each item received.) ƒ Provide financial incentives to stimulate locations of businesses, and assist current businesses on Parsons Ave. (18) ƒ Acquire and package adjacent parcels to stimulate developer interest (16) ƒ Demand higher architectural standards for new build and remodeling projects. (9) ƒ Stronger code enforcement- ultimately City taking control of derelict properties if necessary (8) ƒ Improve traffic flow – reduce the number of traffic lanes (7) ƒ Explore the Neighborhood Conservation District idea- especially focusing on the commercial corridor (3) ƒ Use Urban Recovery Infrastructure Funds in area (2 )

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

ƒ Dedicated code officer for the Parsons Ave. area (2) ƒ Help to locate a major new attraction in the area (like the Arena or Baseball stadium) ƒ Give more weight to community concerns about demolition – change process of reviewing permits ƒ Dedication of more City services to the area; police protection, code enforcement, trash pick-up etc. ƒ Graffiti removal program ƒ Split the 13th precinct- too large to be effective ƒ Keep a high profile with Mayor and Council ƒ Ward representation

3. What can the Community do? ƒ Get involved with the neighborhood associations ƒ Keep everyone’s “feet to the fire” (accountable) for implementation; especially with changes in administration ƒ More business owners participate in the neighborhood associations ƒ Support Parsons Ave. businesses, now and in future ƒ Use self taxing (like Special Improvement Districts; Downtown Ambassadors) ƒ Beautification (overhead flower baskets, etc.) ƒ Better communications across the entire area (some don’t receive the This Week South Side, and other publications that are supposed to be regional) ƒ Community take over and use the web site after the Vision Plan process is complete ƒ Need a “champion” ; a group or person with influence to get the power brokers’ attention ƒ Express appreciation for positive efforts ƒ Neighborhood Associations and Organizations coordinate and produce more unified efforts ƒ Reach deeper into the community for communications and involvement ƒ Engage the landlords as part of the community

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

COMMUNITY FOCUS GROUPS 8/25/05 and 9/01/05 PARSONS AVENUE VISION PLAN September 23, 2005

Introduction

Residents, business owners, and other interested participants gathered for community focus groups on August 25 and September 1, 2005. These groups were held to integrate the community with the visioning process. Respondents were shown maps of the general study area, with the explanation that they could comment on relevant areas outside those that appeared on the map. Throughout the fall and winter of 2005, community focus group questions will become more specific as the Parsons Vision Plan solidifies.

Approximately 20 individuals were in attendance at each meeting. A few individuals came to both meetings. A total of five groups provided input on these dates, and attendees were generally enthusiastic about the process, taking the entire two hours to contribute to the discussions.

The following is a discussion of the three specific questions that were posed to each of the community focus groups. Note that the term “Greater Parsons Area” was left to individual interpretation.

1. What are the attributes of the Greater Parsons Area that are sacred, and you wish to see preserved or do not want to see changed in the future?

Retail and Old School Retail Culture Many respondents commented about the importance of maintaining the current retail climate, both in terms of keeping businesses alive in the area, but also that retailers who had stayed in the area for decades were truly sacred. Having these “mom and pop” businesses, where shopkeepers know customers by name, and personal service keeps people coming back is vital to respondents. Most agreed that larger chains and high-end shops would not work on Parsons Avenue, and some noted that they did not want these types of businesses. However, a few people did mention that they would like to see Target or Kohl’s in the old Schottensteins store.

The idea of preserving existing small businesses and inviting new small business owners with compatible offerings (see suggestions for retail at the end of this report) is of relatively high priority to the group. “We need homegrown businesses who have a stake in the community, mom and pop stores…not chains or businesses that will leave when they have a poor fiscal year.”

The loss of many businesses over the past several decades, particularly the spring 2005 closing of Schottensteins Department Store, has been difficult for the South Side. One respondent noted that she thought the store gave the corridor an identity. Certainly, the store, which had done business for nearly a century, anchored the corridor and provided a destination for shoppers. Shopping at Schottensteins

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

was a multi-generational activity for South Side residents, many who look at the vacant building with sadness and nostalgia.

Suggestions for new retail vary widely, but most respondents agree that it should be kept on a neighborhood scale. “Going to a neighborhood business is a more personal experience.”

Examples of “sacred” businesses, some of which are now closed, include: x Kroger (1441 Parsons) x Lois Mann’s Restaurant x Tee Jaye’s Restaurant x Automotive Stores x Schwartz Tax Service (one of the respondents owns this shop) x Dairy Queen x Bakery (closed) x Isaly’s Ice Cream (closed) x Schottensteins (closed)

Public Transportation and Traffic Patterns The general perception among respondents is that bus service is very important to residents of the corridor. Most who brought up this topic as “sacred” noted that they do not use the bus daily or even weekly, but add that they believe it’s important that the neighborhood be well-served by the Central Ohio Transit Authority (COTA). Respondents were divided on the issue of whether COTA provides good service to the area.

Several respondents warned, “Don’t mess with traffic and transportation patterns through the area” and leave ingress and egress intact. There is some concern about what will happen when the Interstate 70/71 split is reconfigured. Other traffic-related concerns include high volumes of traffic, speeding and truck traffic along Parsons Avenue. In addition to making the area less pedestrian-friendly, these trends make navigating the corridor difficult for drivers.

Some of the older residents commented that they rarely walk along Parsons Avenue. Approximately ten respondents noted that they drive more than walk on Parsons Avenue. The remainder had no comment on this issue. However several comments were made about how easy it is to get everything you need in the neighborhood within walking distance. “You don’t need a car to go about your life.”

Preservation of brick streets is encouraged; brick streets calm traffic and are historic; aesthetically pleasing.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Location and Accessibility A large number of respondents love the central city location of the corridor, commenting that the Greater Parsons Avenue Area location is great—highly accessible, close to downtown, southern Ohio and major highways. However, several noted that the area is “cut off” from the rest of the city. This isolation is psychological rather than physical, and those who are not familiar with the area dare not venture down the Parsons Avenue corridor, because of perceptions of crime primarily.

Neighborhood and Community Pride The sense of neighborhood and community is sacred. For example, family owned businesses thrived along Parsons Avenue for decades. Neighbors are loyal to those businesses, and the sense of pride and tradition is still alive. Keeping families in the neighborhoods is a priority, and improvements should consider multiple age groups—youth- and senior-friendly uses—to keep families in the South Side.

Tradition and History Almost all of the respondents, even the younger ones who had not lived in the area for a long time, spoke of preserving and cherishing the physical, cultural and/or sociological elements of tradition and history in the neighborhoods surrounding the Parsons Avenue corridor. The fact that the area grew out of a “melting pot” around the turn of the century, with Italian, Greek, Hungarian, German and African American families all putting down roots is fascinating and sacred to respondents. The diversity of these groups as well as the wide diversity in land uses in the area creates a “city within a city” effect around the corridor.

Some fear many of these cultural vestiges have been lost, and should be remembered or preserved. A very large number of “sacred” comments focused upon maintaining and preserving the tight-knit yet rapidly shifting cultural fabric of the community, as well as its architectural integrity. Many comments indicate a perception that these qualities are “slipping away,” and therefore represent something even more sacred to these community members.

Preservation should be conducted on several levels:

Physical: x Keep fronts/facades of older buildings intact; keep sidewalks intact. x Rehab and preserve buildings on Parsons Avenue x Develop incentives for reuse and rehabilitation x Preserve the “working class” character of the neighborhoods, avoid gentrification x Historic “purity” in building not highest priority; rather, new adaptations x Preserve and grow home ownership—use incentives! x Identify and minimize derelict buildings and absentee owners x Keep the integrity of old, pretty homes but blend new structures into the neighborhood. x Historic preservation—we need guidelines! x Brick streets (calms traffic…need a plan for maintaining them)

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

x Preserve green spaces—they are important x Preserve scale and style—new structures should match existing structures x Gateways make neighborhoods inviting x Conserve the neighborhoods near Children’s Hospital

Emotional: x Let me keep my memories! x Preserve loyalty to neighborhoods x It is the “South Side”, NOT the “south end” x Nostalgia for “glory days” of thriving industry and retail activity is alive and well x Southside does not get its “fair share” of housing (and other) resources x The neighborhood is like a family group—residents feel very connected. x People really help each other here

Cultural: x Churches are big asset and strength for building to the future x Library…expand it! x South Side Settlement House x Southside Learning & Development Center x Ethnicity, history and culture x Quality of life programs, including food pantry, nurse, social workers. Some sacred things have been lost—Community Hospital, St. Leo’s x Preserve diversity of income and ethnic groups—“people from all walks of life”. The vision plan should reflect that—be inclusive, not exclusive. x People, rich history. Don’t force people out of the South Side.

Civic/Public Safety: x Bike police patrols x Utilize the city-owned building (PAL Bldg.) x Strong zoning and code enforcement x Powerful Area Commission and Neighborhood Associations (without the loss of community power)

Economic: x Help existing businesses x Help attract and grow new businesses—there are no banks here anymore. x Preserve socio-economic mix; gentrification usually does away with that x Protect strip from pawnshops and other predatory businesses x Maintain the mix of residential and commercial uses

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

x Need hotels, motels x Stop/keep illegal yard sales

2. What do you feel makes your neighborhood and the Greater Parsons Area unique (could be positive or negative) when compared to other Columbus neighborhoods?

Many of the elements that are considered sacred to respondents are linked with things that they consider to be unique as well.

Cultural and Community-Based Assets

Many respondents expressed pride in the cultural melting pot that comprised Parsons Avenue in the early portion of the 20th century. It is important to remember, say a few, that the South Side still serves as a portal for many families moving to Columbus from Appalachia—Kentucky, West Virginia, Tennessee, and other areas. The area inspires loyalty, and some families have many generations represented here. However, schools have a bad reputation, and families have begun to move out.

Several respondents say they like the fact that there are so many schools in the area. The fact that many schools are historic structures is also a bonus, although it appears to be causing some controversy among neighbors, some of whom want to see buildings demolished and rebuilt; some who want to see historic buildings preserved.

The mix of low-income and moderate-income residents is viewed as unique. Overall, the area’s ethnic and economic diversity is considered a very good thing. People from “all walks of life” live in the South Side. This is a place where the “county auditor talks to the guy who collects aluminum cans”. The wealth of the community lies in the family owned businesses, and the blue-collar working family neighborhoods.

The people are unique—there is a sense of generosity, neighborliness. It’s a close-knit, “face to face” type of community. There are small yards but lots of community spaces.

Community services and programs are unique—respondents describe the South Side as a little “downtown” with a post office, a library, stores, and industry—like a small community within the city. Assets include the Maloney Health Clinic, South Side Settlement House, South Side Learning and Development Center, the area’s churches, and the library, which needs to be bigger.

The strength of outreach and social service organizations is viewed as unique, and very positive. “The South Side Settlement House gives people a forum to get help, voice problems, learn, etc. It’s convenient, and really promotes community.” Also, “We have the South Side Child Development Center, also an excellent community resource.” There are strong connections and communication

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

between neighbors here. There are historic school buildings and a real sense of community with the schools. The area has a large number and variety of community organizations. There are a lot of resources available through social organizations and churches, to help people meet their basic needs. Networking and resourcefulness are strong within these groups.

The South Side has a very unique culture, hosting tent revivals and one of the city’s two drive-in movie theaters. It represents true Rustbelt Americana—places like Dan’s Drive-in, the South Side Flea Market, and Original Tee Jaye’s, Plank’s Restaurant, Lois Mann’s restaurant, and the old style Dairy Queen. The neighborhood is accessible to other arts communities in the central city. However, several respondents comment, “within all that, the South Side always gets forgotten. We never get the recognition that that Short North or German Village do.”

Underserved Area of the Central City

Although the South Side is generally viewed as having strong and visible political representation, comments about uniqueness invariably turn towards the fact that the area is underserved politically, financially, and given a “bad rap” by the press. Further, some respondents believe that the South Side has been promised plans that do not materialize. “Although we have a new firehouse and medical center (the city did give us that), I still don’t feel safe after dark.” And, “Buckeye Steel Castings is the area’s second largest polluter, and yet the Ohio EPA does not seem to care.”

Respondents note a general lack of support from city officials in terms of combating blight. Maintenance issues are a large source of frustration, and South Side residents feel neglected or even ignored in terms of trash pickup, and city code enforcement. Trash in alleys is a large maintenance issue, and overgrown trees in alleys are also a big issue. One respondent notes, “The Parsons Avenue area is the last bastion in the city of Columbus without an infusion of money”. Further, the media “implies” that Parsons Avenue is either bad or nonexistent. Comments related to the South Side being “uniquely underserved” include the following:

“People have used the South Side as a testing or dumping ground, then abandon it for other areas.” “The area needs a total facelift.” “People are fighting to maintain their neighborhoods” “People are afraid—there is high crime here.” “People here have low expectations. They get used to being apathetic” “The neighborhood doesn’t feel empowered. Middle- to low-income families need some support to feel empowered.”

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Commercial

The mix and tenure of some of the local businesses is considered very unique. Some have been in business for over 50 years, and people are loyal to them. The businesses have been loyal to the neighborhood as well—could have moved away but didn’t. New operations such as the farmers’ market on Marion Avenue are viewed very positively.

The Parsons Avenue strip also stands out in a more negative way—respondents perceive that the commercial strip has many redundant (and negative) uses—used car lots, used furniture and appliance shops, bars, pawn shops, cell phone shops. Several agreed that these uses are unique in that they are signs of hard economic times. But these businesses don’t contribute positively to the neighborhood. Some even say that certain businesses are just fronts for drug dealing activity.

Some new forms of entrepreneurship have respondents divided. Some perceive street vendors (with movable concessions carts) as a harbinger of trash, health risks, and unsavory customers. Others see street vending as an opportunity for business growth. “These are real mom and pop businesses.”

Physical

The historical nature of housing is considered unique, as it the diversity of land use in the area. There is a mix of retail, housing, and manufacturing. This is unique in Columbus and played right, could be a real strength. Older properties have a lot of potential and a lot of character. This area was built when the “anything goes” style of housing was going on. That resulted in very diverse styles of housing. Further, some housing units, particularly those used for rentals, are poorly designed and neglected and should be knocked down.

Although diversity of land use in the housing/retail/commercial mix is generally considered good, many comments indicate that both Parsons Avenue and Lockbourne Road have a very high concentration of bars, and that too many bars cause unwanted crime.

Further, most respondents agree that industrial uses are not compatible with housing in terms of quality of life: “we have a wide mix of institutional (Jail on 104), industrial (Buckeye Steel), Trash burning power plant, Rumpke, and others. It’s a mixed bag of somewhat unpleasant uses. Ohio Mulch stinks!”

Others argue that their neighborhoods are calm, quiet and pleasant. “It’s a block to block thing”. It’s a little country and a little bit city.

Parks, accessibility to the Scioto River and wildlife, the large number of dogs in the neighborhood, and the dog activity in Schiller Park are all viewed as positive. The area has lots of neighborhood gardens, landscaping, and old/unique trees.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Vacancies create opportunities for improvement, clean industries and warehousing would be welcomed. The vacant or underutilized properties could bring new life to the community. Future uses could be community centers, green space, more parks as well as commercial uses.

3. What improvements (social, economic, infrastructure, services, environmental, etc.) need to be made in order to create a better future for the area and its residents?

Land Uses-Housing

The largest share of respondents noted housing rehabilitation as their most needed improvement. Cleaning up abandoned homes and addressing residential vacancies, both of which invite crime and decay, were noted often. Establishing target areas or zones for housing improvement would be helpful. Many noted that absentee landlords contribute to housing decay, and spoke hopefully about increased home ownership.

Several people pointed out that the German Village and Merion Village areas both have a lot of momentum in terms of increasing housing values and improving perceptions. The entire area could benefit from this. However, inviting opportunities for housing investors is not a welcome idea. Owner- occupancy is key, say most. The community needs a lender to step up—improve access to financing, and (community organizations) need to educate people on home ownership and living within their means.

The consensus among all age groups is that seniors, children (family households) and underprivileged people should NOT be forgotten during housing improvements. The construction of affordable, accessible senior housing might be a good idea, some say. Others say seniors on the South Side want to stay in their homes as long as possible, and they are good for the neighborhoods.

Opinions on development of low-income apartments were divided. Some respondents were adamant that they do not want any additional “Section 8” projects developed on the South Side. Others said that affordable housing is needed, but it needs to be professionally operated, and well kept.

All agreed that new housing (and retail structures) should be on scale with the rest of the neighborhood, and should match the “historic look” of housing in the area.

All agreed that code enforcement should be backed up with stiff fines, and that community groups should pinpoint offenders, judges, and lawmakers. Residents also need to “squeak more” about the problem until it is addressed, many say.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Respondents disagreed on whether the addition of new apartments or rental units would be positive or negative. One commented, “I’d rather see a neat, well-kept apartment or condominium over a beaten down single-family home.” Merion and Hungarian Villages recently received zoning approval limiting the number of multifamily structures built in those neighborhoods, which are comprised of single-family homes and duplexes almost exclusively.

The 15-year lease-purchase program isn’t viewed positively by several respondents, who think that organizations like Columbus Housing Partnership isn’t acting as a good neighbor by implementing these plans.

Some respondents want increase local neighborhood control, in the form of a Neighborhood Conservation District status that would help to maintain the integrity of the area’s homes and other structures.

Land Uses—Other Uses Several respondents noted that the mentality that “Not In My Back Yard” uses are OK for the South Side needs to be squashed, and that the South Side should begin to demand respect in the form of a more intelligent mix of land uses. Most agreed that the design restrictions/urban-commercial overlay should be enforced.

Several residents of the Lockbourne Road area were concerned that negative land uses and “undesirable” businesses would be pushed to that corridor as a result of the Vision Plan.

Environmental Suggestions for environmental improvements include cleaning up the air/enforcing air quality standards. Many respondents agree with the idea that South Siders likely have health issues because they live in air pollution. Cleanup of Brownfield sites with help from the Columbus Urban Growth Corporation and regulating those operations that are polluting would help.

Perceptions Changing perceptions is needed, but is viewed as a big challenge to those present at the focus groups. Most agree that the perception west side of Parsons is more positive than that of the east side (in terms of crime, housing values, hope for future, etc.)

Many respondents agree that implementation of a positive media campaign promoting the Vision Plan and the coverage of the South Side would be a good start in improving perceptions of the South Side. This campaign could include giving the Parsons Avenue area a catchy name, slogan or phrase to create a positive identity.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Instilling pride in the community could also begin with a logo, advertisements about the history of the corridor, and mention of the famous people who grew up in the area. “We need help improving the way we feel about ourselves, our community”. Several liked and agreed with marketing the South Side’s great location with a billboard slogan advising suburban commuters. For example, a message like “If you lived on the South Side you would already be home” might attract positive attention and put a new slant on old perceptions.

Increasing perceptions of safety, and reducing perceptions that the area is crime-ridden will greatly improve overall perceptions of the area, say many respondents. “People are afraid to come here after dark!”

x Enforce curfews x Get more bike and walking cops x Beginning block watches should model after existing, successful ones x General perception is that the southern portion of the area is worse than northern. Several say to divide the 13th precinct, because it is too large an area.

Traffic and Infrastructure Suggestions on improving traffic and roadway infrastructure are primarily fragmented, although many respondents agree that people drive too fast along the corridor. Other suggestions include:

“Install brighter lighting, but less traffic signals on Parsons Avenue.” “Install traffic calming devices (speed bumps) on Hosack, Barthman, Whittier.” “Add on-street parking along Parsons Avenue. This helps businesses and slows drivers down.” “Encourage pedestrian-friendly traffic measures.”

Economic

An improved Parsons Avenue should mean increased jobs on Parsons Avenue. This means creating a more inviting place that will attract businesses. Several different approaches were touched upon during the focus group conversations. The following is a synopsis of the steps that need to be taken, according to respondents:

x Establish a consortium of businesses and property owners to do comprehensive facelift of the Avenue. Use funding from government and banking partners.

x Organize neighborhood litter cleanups. “Beauty dies where litter lies.” Designate the South Side as a community recycling area. Make it a hub or a model area for recycling efforts.

x Establish committees to fill large buildings and industrial vacancies. Have the city make it their focus.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

x Recruit active, thriving businesses that are participants in the community.

x Start a business incubator for small businesses. For example, the area has lots of trades people, and good hardware stores. Think tank of contractors, or a builders' consortium of some sort. Try and attract companies like Durable Slate to the area. Contractors should be in incubators.

x Market the area as a true city neighborhood; a blue-collar neighborhood. Near West Side of Cleveland or . . . .the Brooklyn Bridge area in New York. A somewhat gritty, authentic neighborhood.

x Build on opportunities such as the empty (city owned) lot next to the Farmer’s Market on Marion Road. Also, the for-sale property adjacent to the Southside Branch of the Columbus Metropolitan Library.

Organizational/Programmatic Improvements targeting local social service organizations include linking churches with rent-paying users such as job services, counseling, etc. Recognize (with grants and funding) the efforts of area churches.

The Vision Plan should result in the following: x Focus on a (few) single, targeted issue x Include mechanisms to maintain the Vision Plan actions…tracking system, accountability. x The resulting Vision should be a “Win-Win” for all--don't push some out. x Need continuation of the WEB site, accurate information, and press releases through the Mayors office. x Need to expedite the Lockbourne Road Plan (it needs to work together with the Parsons Corridor effort)

Improvements to early childhood education, parenting training, available and affordable day care are all ongoing efforts, say respondents. Several comments related to youth and child development include:

“Children are the key for the future so school improvement is a must.” “…(Children) are the engine for training, jobs and keeping people within the neighborhood.” “Parental involvement is key.”

Community Facilities

Add a YMCA, recreational facility, or fitness center, with appropriate programming for all, say many respondents. “Our children need a YMCA, since our old one was closed.” According to consensus, the following programs should be implemented out of such a facility:

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

x After school programs for kids x Health and fitness activities for seniors x Arts and crafts for seniors and kids x Recreational programming and events for the whole community x Put in a Cultural Arts Center or Theatre.

Retail Improved retail would collectively make the South Side a destination point for visitors to eat out, have an authentic meal (German, Italian, Soul Food, etc.), shop, feel safe, and enjoy an option to the Short North and German Village.

Suggestions for improved retail corridor: x Bank x Theatre x Farmers Market (expand existing) x Ethnic Restaurant x Ethnic Market x Tea or coffee shop x Sit down restaurant x Sit down fast food x No chains, but Tim Horton’s wouldn’t be bad! x Cluster of antique stores x Clothing x Appliances (new!) x Double size of library

Suggestions for uses for Schottensteins building x Food court x Small appliance store x Flea Market (tasteful) x Dance studio, theater x Artist lofts x Business incubator x Target, Kohl’s x Karate Studio x Specialty grocery

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Several types of retail that comments indicate are not needed along the corridor include: x Bars—cheap liquor holes x Used appliance shops x Pawn Shops x Used furniture shops. x Laundromats x Drug Stores

Burns Bertsch & Harris POD Design Vogt Williams & Bowen 1355 King Avenue 330 West Spring Street 869 West Goodale Boulevard Columbus, Ohio 43212 Suite 300 Columbus, Ohio 43212 614-488-1150 Columbus, Ohio 43215 614-225-9500 1-800-937-3952 614-255-3399 614-225-9505 Fax 614-488-4255 Fax 614-255-3999 Fax Greater Parsons Avenue area vision plan

Ms. Boumis of Burns, Bertsch & Harris, Inc. and Forrest Gibson of POD Design facilitated a meeting with the members of the Merion Village Civic Association on September 29, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible. • Schottenstein’s site redeveloped into a retail center o Business types mentioned include coffee shop, Panera, farmer’s market, full-service bank, bakery o Want a wide variety of shops o Some favor a large scale retailer o Like the shops in the Short North; small, unique shops o Shops that cater to needs of residents o Don’t turn Parsons Avenue into a strip mall with big boxes and chains • Safe walking areas • Bars cleaned-up • Thriving merchants • Neighborhoods cleaned up; improved maintenance of existing properties • Neighbors forced to take care of their property; improved code enforcement • Trees on street; flower boxes; greenery • Older buildings renovated and brought back – windows unbricked, etc. • Back to what Parsons Avenue used to be – a thriving urban center • Trash along Parsons Avenue cleaned up • Residents proud of neighborhoods • Healthy economy • Positive reputation to those outside the neighborhood • Commercial overlay enforced • Conservation district enacted • Existing institutions strengthened o Library; South Side Settlement House; Maloney Health Center; churches o Classes/educational seminars provided at local institutions for residents (homeownership, etc) • Children’s Hospital developed properly – design sensitive to neighborhoods • Stronger bank/foreclosure laws enacted • Parsons Avenue will serve as a link to the neighborhoods on both sides • More active Parsons Avenue Merchants Association (PAMA) • Residential maintained along Parsons Avenue • Neighborhoods not gentrified – remain mixed income • Homes converted to condominiums in select areas

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

• Parsons Avenue is an economic engine • Entrepreneurial opportunities • New development compliments existing development • Improved sense of safety; more police on streets • Number of liquor stores reduced • Brownfields redeveloped • Improved services for residents o Job trainingfacility o Tutoring/school center o More community space

2. What can the City do to ensure that your vision becomes reality? (All of the ideas presented were discussed by the participants. However, participants were asked to prioritize these items. The number in parentheses represents the number of votes each item received.) • Proactively enforce property maintenance codes (42) o Work with police • Focus efforts on economic development in order to create jobs and enhance small business growth (40) o Create incubator space o Create tax incentives for building rehabilitation o Create a SID (Special Improvement District) o Utilize Chamber resources o Bring in businesses and offer them a tax incentive if they hire locally o Work closely with local businesses – training, etc. o • Enforcement of urban overlay – no exceptions (including none for Children’s Hospital); appoint one individual to work with cases involving overlay in order to have some consistency (28) • Increase police presence on streets (19) • Create a landlord law (12) • Expand library (10) • Get rid of large trash containers (8) o Make recycling a part of the service provided • Create senior citizen housing (3) • Show greater interest in south side issues (1) • Repair alleys (1) • Protection for elderly – create programs to keep the taxes low • Improve parks and recreation o Expand hours and programming at existing facilities • Develop programs for grants/loans that can be given to individuals who want to improve their property; look at what other communities around the country are doing

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

• Acquire properties for redevelopment

3. What can the community do? • Help neighbors • Help keep the neighborhood clean; pick up trash • Support civic associations o Get neighbors more involved o Promote community spirit • Keep property maintained • Draw organizations together; support each other • Be active with churches, etc. and support social service efforts • Support businesses and organizations in the area • Attend City Council meetings – get the agenda of the south side in front of Council; insist the City must focus on Parsons Avenue – keep the momentum going • Understand the resources that are available for people and help connect them to those resources • Talk positively about the neighborhoods to outsiders • Involve businesses; create partnerships; businesses will benefit when neighborhoods improve • Reach out to schools

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Parsons Avenue Vision Plan Targeted Focus Groups Real Estate and Development Professionals October 13 - 14, 2005

The consultants from VWB Research and Burns, Bertsch and Harris held two focus groups with local development professionals, including representatives from local realty offices, development organizations, land holding companies, and planning agencies. All of the respondents have first-hand experience with development, infill, rehabilitation, renovation, land use analysis, planning, and other key issues that affect the Vision Plan. The following is a summary of these focus groups.

Most respondents agreed that housing rehabilitation in the neighborhoods surrounding the corridor is a logical step toward revitalizing the corridor. Many noted that the momentum experienced by German and Merion Villages has already increased interest in the South Side.

Several comments on pathways to home ownership pointed to different programs that could involve local lenders as well as public incentive programs. One neighborhood resident that has renovated numerous homes notes that financing is often the primary barrier to housing improvement projects. Various assistance programs (for housing as well as neighborhood improvements) include the following:

Private Lenders: x Huntington National Bank City Community Access Mortgage Program x Third Federal Bank 3.0% down payment program x 5th/3rd Bank 0.0% down payment program

Publicly Administered Programs x Tax Incremental Financing (TIF) for infrastructure improvement x Community Reinvestment Area (CRA) designation x Special Improvement District (SID) designation x Tax Abatement for housing (typically, respondents say, you have to have a significant redevelopment project) x City investment in foreclosed properties

Respondents discussed the fact that housing stock within the study area is high quality with larger units that in German Village and other central city areas, in generally good condition, and relatively uniform in terms of age (1900 to 1940). Not a lot of newer, lower-quality infill has been done in the area, which is a huge advantage in terms of garnering interest from outside. Further, the stock is overwhelmingly single-family and duplex units, with very little multifamily housing. These “housing assets” will serve to encourage investment in the South Side.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Trends in housing value increases and home ownership in the Merion Village area over the past several years were described very positively by many respondents. Many of the real estate professionals noted that housing values are on the rise on the east side of Parsons Avenue as well. However, absentee landlords and decaying, vacant stock continues to threaten many South Side neighborhoods.

The majority of respondents noted that given the study area is so large, and there are many potential sites that could be targeted for redevelopment, that attention to quality is important.

The neighborhood’s potential for retail development was discussed in more general terms. Many respondents commented that the Schottensteins Department Store building is a natural focal point for redevelopment. Several noted, however, that the new use should be able to draw visitors from outside the South Side area. All recognized that the site, given its size and proximity to the downtown, the corridor, Route 104, and neighborhoods, has real potential for a variety of different types of developments. But, some commented that the use should be “retail” rather than “institutional” or “commercial”.

Other comments for retail related to making retail establishments more attractive (landscaping, lighting, and sidewalks) but still keeping them secure. Some respondents noted that residential uses are not appropriate for the retail strip, but others disagreed, saying that the study area is long, and will never be truly consistent in terms of uses. Many respondents commented that they liked what was happening at Marion Road east of Parsons with the Farmer’s Market. This type of use, something with the potential to attract visitors from the outside, is what they would like to see increase. Other spots that do this now include Tee Jaye’s Restaurant, the Parsons Avenue branch of the Columbus Metropolitan Library (to some degree), and Schottensteins before it closed. The Farmer’s Market is creating a buzz, improving the area’s image, which is a very good thing.

The area’s capacity for an industrial redevelopment was not discussed in detail, but several respondents noted that the area’s existing industrial facilities are older and lack elemental features that would make them competitive with other, newer facilities, particularly those within the Southeastern quadrant/Rickenbacker area, which has a very high concentration of new transportation/warehousing/industrial facilities. In summary, although the area has excellent access to downtown and other areas via I-70, I-71 and State Route 104, retooling of industrial property was not addressed as a priority. However it was noted that the Marion Road area has traditionally been occupied by industrial/warehousing tenants, and those uses are expected to continue.

One issue that was discussed in depth was community involvement, particularly in terms of neighborhood clean up and crime issues. It was agreed that the corridor neighborhoods have a negative reputation for public safety.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Suggestions to decrease negative perceptions include:

x Installation of street and alley lighting x Installation of landscaping x Neighborhood/community involvement in block watch groups x Involvement of Community Crime Patrol forces to assist officers x Active communication with local liaison officers and patrol officers x Publication and distribution of crime statistics on a monthly or quarterly basis x Involvement of local retailers with neighborhood block watch groups

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Forrest E. Gibson consultant of POD Design, Inc. facilitated a meeting with members of the Hungarian Village Association on October , 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible.

More and diverse business establishments Parsons Ave. needs a branch office of a bank Fewer used furniture and Pawn Shops Safe, walkable streets Clean environment in which to shop More “sit down restaurants” Kid’s have pride in the neighborhood Destination shopping with entertainment Expanded Library Play space to address the needs of today’s and future kid’s Open lots reused as new development sites (residential and commercial) Current architectural character preserved The history of the area is preserved and promoted Increased police presence

2. What can the City do to ensure that your vision becomes reality? (The participants discussed all of the ideas presented).

Increase police dedicated to the greater Parsons Avenue area - no split of 13th precinct personnel Create a multi-jurisdictional police force for the area Push to reuse vacant property Create a marketing plan for the area Work with the Columbus City School District to improve the quality of education Dedicate at least one individual for ACTIVE code enforcement in the area Broader and more effective trash clean-up service Improve the recreational facilities Enforce the Urban Commercial Overlay Create incentives to encourage/ entice business development in the area Create incentives for the construction of better homes including rehabilitation opportunities Hold landlords accountable for properties in disrepair

Due to time constraints this group was unable to review question 3. What can the community do? However the group was able to provide priorities for the question of what the City can do ensure that the Vision becomes reality.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Stacey Boumis of Burns, Bertsch & Harris, Inc. facilitated a meeting with members of the Southern Orchards Civic Association at Children’s Hospital on October 4, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible. x Small shops (Short North Concept) including: … Retail including specialty shops …Galleries …Bookstores …Minority owned businesses …Something w/Southern Orchards theme …Beauty shops, barbershops …Bakeries …Restaurants (ethnic) …Specialty shops (no fast food) …Day cares …Banks …Grocery store (for the Southern portion of Parsons Ave.) …Fabric/craft shop Note: No phone stores, pawnshops x Green space / parks, more lid space / playgrounds x Put parking back on Parsons Ave. / no speedway x Clean alleys, streets, new curbs and sidewalks x More home ownership x Maintain diversity x Better lighting x Police substation, police on foot, minimize crime x More church activity x Filled vacant buildings x Things appealing to youth…arts/culture, social space, areas for physical activity (like the King Arts Complex) x Bigger library…youth outreach programs

2. What can the City do to ensure that your vision becomes reality? (The participants discussed all of the ideas presented). Participants established priorities by assigning color dots to the elements they determined most urgent. The accumulated value of points for each item is shown in (*). x Clean up City, police enforcement to get ride of drugs and crime (16)

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

x Positive attitude about community; get people involved to feel positive about the neighborhood …ripple effect (8) x Continued community involvement … meetings, survey, keep people engaged (4) x Bring businesses to the area (6) x Transportation … work w/COTA to get people to jobs x Keep the area clean (see #1) …lights and other public improvements, deal w/vacant lots (4) x Landlord registry …vacant homes, absentee landlords (10) x Better laws to support code enforcement x More activities in parks for children (9) x Job training (5) x Equalize where felons and sex offenders are placed (6) x Better disbursement of subsidized housing and sex offender housing (4) x Help bring in home owners / increase home ownership x Incentives to fix up homes (5) x Attract developers that are committed to the area (6) x Lobby / support improved state laws addressing code enforcement and real estate brokers (4)

3. What can the community do? x Patronize local businesses x Maintain homes x Help elderly x Assist in programs targeted at kids x Volunteer in the community / schools x Take back the streets

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Dianne Harris of Burns, Bertsch & Harris, Inc. facilitated a meeting with the members of the Vassor Village Civic Association on October 5, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible.

ƒ South Side recognized as the great place it is; new improved image ƒ Parsons is a cool, fun , entertainment destination ƒ Better shopping options; businesses with wide appeal ƒ Specialty shops, higher quality goods also available ƒ More health facilities, esp. medical specialties ƒ Coffee shops and gathering places to share culture ƒ Wi-Fi Hot Spots, and more use of technology for the “cool” factor & for enhancing interaction ƒ Parsons Ave. is a walkable shopping district that feels safe, and is family friendly ƒ Area retains its eclectic and diverse character, human and architecturally (but not museum like) ƒ Continuous pleasant landscaping plan tying the commercial corridor together ƒ Business owners take responsibility for their role in the community – should make it a place they can be proud to be part of ƒ “Branding” use of signage to tie Parsons corridor together with unified appearance ƒ Parsons Ave CLEAN ƒ There is good traffic flow and adequate parking ƒ Reduce number of one-way streets and easier turning ƒ Completed ADA improvements, streets and sidewalks in good safe condition ƒ Traffic calming; especially on Jenkins. ƒ Better street lighting ƒ Strict controls on peddlers ƒ Properties well maintained; clean and painted ƒ Continuity in education- kids can go through school in the neighborhood ƒ Better schools ƒ More parks and safe places for kids ƒ A good place to raise families ƒ Cohesive marketing- Vassor Village as a celebrated destination around a glass-district theme (galleries, shops, museums about stained glass & lead glass) ƒ Tear down derelict and hopeless buildings to make room for museums, public uses, fire stations etc. ƒ Limit through truck traffic (especially at night) ƒ City incentives to attract businesses available

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

Dale F. Bertsch of Burns, Bertsch & Harris, Inc. facilitated a meeting with members of the Marion Franklin Village Civic Association on October 11, 2005. The results of the session follow:

1. Think ahead 10 years into the future. What do you want Parsons Avenue and your neighborhood to be like in 10 years – positive and constructive statements? Don’t worry about the realism, how it is going to get done, or who’s responsible. x Safe community, no heavy truck traffic x Major streets have been improved and have attractive sidewalks x The neighborhood has been revitalized and codes are being enforced x Marion Franklin has its own Pride Center x We have our own library x There is a community focal point for neighborhood activities and gatherings x The 14 acre site at 2440 Lockbourne Road has been developed to the benefit of the community x There is a Learning Center for preparatory and continuing education x There is an attractive strip mall suitable for small business incubation x We are finally realizing “our fair share” of Columbus tax dollars x We have a department store, grocery store, bakery, drycleaner, restaurant, theater, etc. x We have a police sub-station and an adequate number of police officers x The community is well kept and well landscaped x We have an urgent care facility and doctors x There are jobs for everyone who wants one x We no longer have any bars or liquor establishments x The junk yards and used car lots are no longer in the neighborhood x There are more parks including walking/bike paths

2. What can the City do to ensure that your vision becomes reality? (The participants discussed all of the ideas presented). However, participants determined that all of the identified items were appropriate, necessary and of the highest priority. x The City should keep the promises that have been made x Zoning patterns should reflect our vision and plans…and be enforced x The City should offer tax incentives for targeted businesses consistent with our vision x Enforce our area plan “The Tri-South Plan”

3. What can the community do? x Residents must get involved x Maintain our homes x Come together and support our vision and plans x Publicize and participate in community events x Aggressively market the community internally and externally

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

2. What can the City do to ensure that your vision becomes reality? (All of the ideas presented were discussed by the participants. However, participants were asked to prioritize these items. The number in parentheses represents the number of votes each item received.)

x Reduce bureaucracy that inhibits business start ups; e.g. building code variances to accommodate retrofitting old buildings. (3 pts) x Maintain streets & sidewalks; e.g. kill weeds, replace trees in ROW (3 pts) x Increase Police presence in neighborhood (32 pts) x Provide open support for South Side activities x Better code enforcement procedures ; e.g. allowing officers to respond to complaints sooner (3 pts) x Code officers must be available on 24/7 basis to deal with weekend problems x City council must interact with School board to work together to improve schools. (Many of us will leave if schools don’t improve) (8 pts.) x Provide better resources to tenants to obtain action from landlords. (6 pts) x Hold landlords responsible for the exterior appearance of their properties. (3 pts.) x City immediately plan response to loss of major business tenants (like Schottenstein’s building compared to action taken re: Morse Rd) x Facilitate conversion of Buckeye Steele property to cleaner uses (maybe lofts and malls) x Plan clean up of major contaminated sites and environmental issues (6 pts) i. Partner with State & Feds to refocus priorities on environmental clean up where residential areas are affected (like South Side & Technoplate) x Offer incentives for local (Central Ohio vs. out of state) businesses to clean up sites in preparation to locate/ expand here. x Eliminate sewer gas smell (1 pt) x Install 90 gallon (personal) trash containers & eliminate 300 gallon size in alleys (9 pts) x Landlords need to be responsible for immediate hauling off of bulk items, and not be allowed to fill all alley cans with construction debris. (Use Personal cans isntead) x Better lighting in alleys. (1 pt) x City stop passing the buck and take action x Mayor should step up and set the agenda for focused efforts on the South Side (5 pts.)

3. What can the community do?

ƒ Residents must get involved- get to know one another- turn on porch lights- be aware- peer pressure- all the little things that make a neighborhood ƒ Create a volunteer/ donation based paint- up program to help the elderly and others unable to do work themselves ƒ Write letters to the editor and “make noise” ƒ But beware of how we speak of ourselves to others- don’t perpetuate negative images ƒ Organize community clean up programs

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

ƒ Neighbors help their neighbors without being asked ƒ Support local businesses – work on shopping promotions ƒ Contact city leaders and the environmental judges with problems ƒ Take maximum advantage of the web site for communication and promotion ƒ Organize community foot patrols with police ƒ Send the message that negative behaviors will no longer be tolerated

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

November 3, 2005 Public Meeting Visioning and Image Rating Exercise

In this exercise participants were asked to view a series of images and respond as to whether they viewed the images to portray a desirable (positive) scenario or feature for the study area or an undesirable (negative) one. A neutral reaction was indicated with an “N”. Not all participants placed a mark under every picture, and a few made brief comments, which have been recorded in quotation marks (“”). It is possible in this exercise that an individual will respond to different aspects of the scene, whether it be the aesthetic appeal of the scene, or to the building use depicted (or sometimes implied). Some images probably inspired both a positive reaction to one feature, but a negative one to another. There were forty-five (45) images, in an effort to put forth a variety of examples of the same use, but articulated differently. This helps to distinguish the exact characteristics that are considered desirable or objectionable in the context of the Parsons Avenue Corridor. The exact responses are recorded according to the order in which the image was presented, along with a description of the image at the end of this report. The analysis is categorized with respect to land uses, but aesthetics are noted if discerned to have noticeable impact.

Residential: (35, 34,32, 31, 22, 11, 10) None of the residential images received strong support. Number 34 with its portrayal of new single family homes built in traditional densities received modest support of 25 of 37 respondents and number 22, which had the character of urban townhouses received support from 23 of 35 participants. Number 10, showing vintage renovated properties received support from about half of the participants. So while maintenance of historic properties is important to the community, the single family units implied “homeownership” and multifamily buildings implied “tenants”, and the preference is for more homeownership. Condominium ownership in multifamily units is certainly not the norm in this community at this time, and thus is probably not viewed as an ownership scenario.

Retail: Buildings: (45, 28, 25, 12, 6, 2) These represent new construction in the chain format, many in the “big box” genre. Only the Walgreen’s received any support (about 1/3), most likely because they already have a presence in the community, and have served community needs. But the structure design is not well received.

Traditional: (27, 30, 23, 37, 42, 18, 1, 36) Urban streetscapes, CBD type development received very strong support, except for Number 1. It was perhaps the only one that did not convey a sense of historic buildings.

Centers: (9, 41, 36)

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Numbers 9 and 41 reflect “typical suburban” shopping centers and received strongly negative reactions, even where attractive landscaping was incorporated at the boundaries. Number 36, was a sketch that could reflect a well done retail center, in a traditional town plaza motif and was strongly supported .

Open Air Markets or Events: (32, 26, 17, 3) Outdoor events and farm markets received strongly positive reactions. Number 32, a neighborhood portraying \perhaps a yard sale or street vendor, received support from only about 2/3 of the respondents. Excessive street vending has been identified in some citizen groups as an issue in the corridor. Parking: (39) Parking structure articulated like a 19th Century commercial structure, “hiding” the vehicles, possible commercial use on the street side of the 1st floor. Strongly supported by 32 of 38 respondents.

Institutional/ Office: (22, 16, 8) These examples were distinctly late 20th century in design and received strong negative reactions. The utilitarian angularity does not blend with historic structures and does not convey openness to the world outside their walls. It is felt that the design of these buildings carried the reaction, and not the activities they would have housed. Only #22, with an implication of residential uses in a traditional townhouse style received a little more than half of total participants’ approvals’, but many did not respond to it- the uses being perhaps too ambiguous. The sketch also failed to convey any sense of plantings or softening at the street edge.

Industrial: (19, 15, 20) These uses received strong negative reactions, although qualified by statement that these may be OK in portions of study area near the interstate- but generally not along Parsons Ave.

Open Space (40, 44, 29, 24, 14)

Transit: ( 43, 37, 33, 21, 13, 7) In general, all depictions of personal transit received mostly positive ratings, whether bus, train, electric street car, or even transit related fixtures like the weather shelters, or hubs.

Safety: (38) The image of bicycle cops was enthusiastically received, and reinforces the attitudes heard in community meetings about the need for greater security, law enforcement, and a desire for creative policing efforts like bicycle cops.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Images Exercise 1. Modern Design Retail Streetscape; 7+ 29 - 2 N outdoor dining, bold colors and design, landscape islands separating sidewalk from a parking area, tall trees behind the structure

2. Renovated Theater (Barnes & Noble) 28+ 8- Implied adaptive reuse of large structure; maintained theater marquis for signage, appears part of a larger retail center

3. Outdoor vendors 23 + 4 - 4 N Colorful tents, attractively displayed goods, open space setting, historic appearing downtown in background

4. Urban Street Scene 21 + 4 - 4 N Historic 5 story building, awnings, iron balconies, attractive commercial signage

5. Creative cut out Business Signs 16 + 13 – 7 N Low street scene of several sandwich board style signs, with cut out figure in foreground.

6. New (BOX) Grocery Store (Fred Meyers) 2 + 28- 2N “Close to Street is good; boxy architecture is bad”

7. High Speed Train at Station 18 + 12- 2N “Rapid Transit, Yeah!” “Train Station on South High Street”

8. Single Story New Government or School type Structure 5+ 29 – 1N Elements include brick with stucco accents, Gabled Entrys with Greek style Columns; No apparent landscaping at front or in large parking lot “Parking should be in rear/side, NOT front”

9. Shopping Center- Recent Suburban Construction 4+ 31- 1N Tall single story (false front), trees and water tower in background, large parking lot, with minimal landscape islands, tall lighting “Ugly”

10. Three Story Residential Multifamily 18 + 15- 2 N Vintage, brick, appear altered with balconies and curving front steps to second floor. Urban character with grassy small set backs from sidewalks ( looks like reconfigured rear elevations)

11. Four Story Brick Residential with Mansaard Roof Line 3+ 30- 2N

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

Recent, large structure with large windows but otherwise plain façade. Small covering marking entrance with curved driveway access, flowers and small shrubs. Appear to be window AC units. One comment “Medical Facility?” indicates some ambiguity in understanding of use.

12. Large Retail - Walgreens – Recent Construction 10 + 27 - 1 N Brick with green hard shell awnings over windows- lots of neon signage, corner entry- parking lot with a few entry shrubs “Yuck”

13. Transit Bus with Bikerack on front. 26 + 2- 4 N Rendering of a park-like stop; large trees, decorative paving, benches, waste containers and gazebo all of complimentary construction

14. Wide Decorative Sidewalks, 38 + 1- 1 N Tree lined, shrubs and flowers- almost park-like, could be a different view of the same site in #13

15. Warehouse/ Industrial – Recent Construction 30 -3+ 2 N Poured wall construction- 1 tiny tree at entry, parking lot buts up against building, attempts to break up mass of wall with horizontal stripes & “neutral” colors- scale definitely reads as a warehouse facility- loading docks not in view of the entry

16. Brick Two Story Office or Institutional- circa 1970’s 1 + 32 - 6N A style that has been used for offices, schools and professional buildings- “energy saving” long narrow windows, few in number; strong vertical accents to break up mass of structure, sort of a front “lawn” with utilitarian evergreen schrubbery (dated suburban feel) No cars or signs of life.

17. Outdoor Event. 31 + 4 - 1 N Vendor tents lined up in a treed open space area in front of collection of medium scale buildings. Lots of people milling about

18. Historic commercial area street scene. 37 + 1 - The “Main Street USA” Look. Low,two story, trees and decorative street lights with banners. Fronts appear “restored” and though similar in scale and style, have variation in colors and architectural elements. Drawing conveys slow pacing- only a few cars, a bicycle rider, couple strolling with baby carriage.

19. Arial view of large Industrial complex. 2 + 34 - 2N Lots of large gray flat roofs and parking lots- some green areas and trees are in the fields, but view does not soften because of them 2 comments “Industry near interstate OK, just not ON Parsons”

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

20. LargeTruck Yard. Loading dock view. 3 + 30- 3N Lines of trailers, edge of parking shows lines of immature evergreen plantings in a grassy area. “Depends on where it is”

21. Electric Streetcars in City Scape (Denver). 31 + 3 – 0 N “Access to transit is important”

22. Sketch of Six Story building Modern construction style- 23 + 6 - 5 N 1 ? Flat roof, angular, parking in first story- could be residential or professional offices

23. Sketch of Six Story Buildings Streetscape 28+ 7 - 2 N 1 ? Could be adapted historic buildings, or new construction. Built up to sidewalks and parking area. Tree lined. Conveys pedestrian activity and mix of commercial and other uses.

24. Open Space. 37 + 3 - 1 N Paved with seating around fountains. Tree shaded with potted plants. Commercial building in background.

25. Shopping Center. Recent construction. (Staples) 4 + 32 - 0 N Brick, false front design. Large parking lot with immature landscape islands

26. Open air produce shop. 30 + 4 - 2 N Produce on quaint brightly colored displays at edge of frame building.. Buckets of flowers. Casually dressed people browsing. Farm stand feel.

27. Commercial streetscape in dense urban area. 36 + 2- 1 N Attractive, brightly lit window displays, canopies, planters with small trees, decorative light poles.

28. Large Retail, recent construction. (WalMart) 4 + 36 - 1 N Benches, brick & stucco, decorative lights and planters. “WalMart = death of small companies” “We have one”

29. Open Space with Strong Entry Feature Pergola 34 + 1 – 1 N Almost appears to be an inset between clusters of low structures- probably commercial in nature. Some paving, lots of trees and flowers.

30. Commercial Corridor. Mixed ages of structures and businesses. 25+ 10 -1 N Clean mostly light neutral color with bright accents on each business. All low, one and two story. Small street trees. Appears busy.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

31. High Rise Residential, Modern Design. 2 + 34 – Brick, glass and steel, with balconies.

32. Vintage Neighborhood. Street Vending/ Yard Sale type Activity. 26 + 10 –

33. Bus Shelter. Metal Supports, Translucent Sides. 32 + 5 – 1 N “ Is this a bus shelter?”

34. Row of Two Story Houses. Recent Construction. 25 + 11 - 1 N Small front and side yards. Traditional feel.

35. Three Story Block Long Building- Modernistic 13 + 19 – 3 N End appears to be office/institutional in character, followed by townhouses.

36. Street Scene Commercial, Central Plaza 31 + 2 – 4 N Lots of trees, people walking about, two story structures, mixed styles.

37. Busy Urban Scene. Public Market Sign. Bus Stop. 32 +5 – 0 N

38. Street Scene, Modern Storefronts, Bicycle Cops 41 + 1 - 0 N “Absoultely!” “Bike cops, yeah”

39. Street Scene Feature Three Story Building- 32 + 5 - 1 N Appears Open Air- like a parking garage- rigid awnings, 3rd story with screening and decorative features

40. Playground 37 + 4 - 0 N Standard equipment, appears to be sand base, with grassy areas in the background.

41. Shopping Center. Located along Street. Newer Construction, 4 + 24 – 1 N 1 ? Low construction, mix of brick, stucco, awnings decorative and tall lighting and landscaped buffer between parking lot and street. Some landscaping in the development. “This is ugly”

42. Dense Mixed Use Area. Four Story 31 + 3 - 1 N 20th Century structure in scale and style to complement the historic building in the foreground- recessed covered walkways for retail , some balconies and architectural features.

43. Series of Weather shelters; 14+ 18 - 4 N Maybe for transit; all paving, large building and vehicles in background

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

44. Park Scene 38 + 1 - Benches, neutral paving, trees lawn

45. Large Retail Store (Giant Eagle) 4+ 32 - “single story, false gable, Modern”; parking with landscape islands (reactions to use or visual?)

Burns Bertsch & Harris POD Design Vogt Williams & Bowen Greater Parsons Avenue area vision plan

December 12, 2005 the Southside Community Acton Network (CAN) organization invited the consultants to present an overview of the project to the membership. Progress to date, the Vision Draft and the Goals & Objectives Draft were reviewed. Members of the audience expressed a desire to have more sit-down restaurants and retail establishments located on the Avenue. Some members expressed a wish for the City to consider the schools, especially South High, as integral parts of the community, and that any plans should consider impacts upon the schools and the students. Several participants spoke of the need to improve the image of the Avenue’s neighborhoods, both to others in the City, as well as raising their own sense of pride.

Later in the evening, six seniors from South High participated in a focus group led by the Consultant and moderated by their Principal, Mrs. Lawson.

“What’s the Best Thing Going On for Teens in Your Neighborhood?”

When asked to describe the best thing about their neighborhood, for teenagers, most said their schools. It was pointed out the South is very much a neighborhood based school, and that these students, as seniors, had attended the same school together for all of high school, some even from middle school. They believe this enabled them to develop close friendships, almost a feeling of being family. One student believed that South was safer than a school previously attended; that the police had a greater presence. Their favorite places were the Salesian Boys and Girls Club, Easton Center, City Center Mall and the Recreation Center at Driving Park. Notably, none of these places are within their own neighborhood. Exploring that issue revealed that they do not have any place within the neighborhood, except school, where they feel they can gather and interact with their friends. There used to be a recreation center in the area but the City closed it.

“What Are the Things That Hold You Back: That Keep Things From Being Better?”

The students pointedly responded that their greatest obstacle was from “negative people”, those who look down on the residents of the South Side, stereotypes about the South Side, gangs, sexual offenders in the neighborhood that follow them as they walk to school or the bus, and guns. They perceive the class discrimination that is exhibited through the demarcation of property values, comparing east vs. west of the avenue, almost feeling physically constrained against going into neighborhoods like German Village. They commented that there were not enough jobs for teens and that the Avenue is “dead”, i.e. no activity for teens, and no place to shop. The group was split on whether they would like to continue to live in the neighborhood once their education was completed and they started their future careers. Those who believed they would leave, felt the best opportunities in their chosen fields existed in other cities.

They wished for people to pay attention to what they (students) do right, instead of blaming all students for problems like litter. They felt that academic requirements, including college entrance tests, focused too much on things that did not seem important to their future. This led to a discussion of their concerns about transitioning to college. They wished for programs that would help them to be able to enter colleges along-side their current friends for the social support, as well as the opportunity to earn college credits in high school. They would like to see more facilities and programs like those offered by Salesian Boys and Girls Clubs, which also offered employment to the teens.

“What’s the Best Thing For Teens That Could Happen Here in the Next Five Years?”

They responded, more, and better jobs, more programs like Salesian Boys & Girls Clubs, new recreation centers, because they do not feel comfortable going to Schiller Park. Driving Park is about the same distance away, but they feel like it is closer. At any rate, neither is really within comfortable walking distance. They would like to see community groups for young people - and places where they can “drop in”, without having membership cards, just use a universal ID if necessary.

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

December 15, 2005, the consulting team made a presentation to a Community Meeting assembled at the Southside Settlement House. The information presented was the results of the previous community meeting, with particular attention to the mapping exercise, in which participants were to indicate parcels or locations that they felt would be key to stimulating redevelopment of the Avenue. The agenda included exercises to have the participants react to a set of goals and objectives developed by the Corridor Development Action Group. A number of participants were attending for the first time and had a number of questions. They also wished to further discuss a number of additional sites of importance and generally how redevelopment succeeds. Due to time restraints, the group did not get to examine goals and objectives for the plan. These will be further crafted and presented at the next meeting. Instead, they were asked to write down their suggestions as to what should be the highest priority areas/ properties for redevelopment addressed by this plan. The compiled results, with the number of persons who recommended this property, are as follows:

1887 Parsons Ave, Schottenstein 1+1+1+1+1 (5) Renovate or replace and reuse

366 Reeb Ave., Steelton Gateway 1

Library 1+1+1+1+1+1+1+1 (8) (Expand) (Relocate to East side of Parsons) (benefit of Kobacker Park) “ to Lois Mann site “ or Kroger site “ or Reeb School if it closes “Parsons & Whittier “ Lincoln Park Lot next to Library 1

Parsons & Whittier (and synergy with Whittier Penninsula) 1

Parsons & Livingston (Childrens & Bobs Chev) 1+1 (2)

Children’s Parking Garage & Area around it 1+1+1+1+1 (5) Prefer retail, office, or commercial on ground floor facing Parsons

Old CMACAO Building 1

Develop Outlots in Kroger Parking lot 1

All vacant lots & abandoned property 1+1 (2)

Lincoln Park School 1 change to incubator 1

Federal Glass Site 1

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax Greater Parsons Avenue area vision plan

North Area: Parsons & Kossuth or 1 Parsons & Stanley 1 Site across from Planks 1

Middle Area Parsons & Southwoode 1 Parsons & Markison 1 Parsons & Welch 1 Lois Mann site 1+1 (2)

South Portion Parsons & Reeb 1 Parsons & Barthman or Marion 1 Market Area 1+1 (2) Southside Market at Maes Market; Marion & Parsons

Great INB (?) for the area with Laundry, Library,groceries, coffee ( related to Library at Kroger?)

Redevelop used car lots to off street parking

Get blighted drug houses out of slum landlords’ possession

More street links (?)

Develop a building like the Central Station in the Short North

Burns Bertsch & Harris POD Design Vogt Williams & Bowen

Columbus, Ohio 43212 Columbus, Ohio 43215 Columbus, Ohio 43212 614-488-1150 614-255-3399 614-225-9500 1-800-937-3952 614-255-3999 Fax 614-225-9505 Fax 614-488-4255 Fax