REQUEST FOR QUALIFICATIONS AND PROPOSALS: PROPOSED HOTEL DEVELOPMENT OPPORTUNITY THE DEVELOPMENT OF A HOTEL PROJECT ADJACENT TO THE UC BERKELEY CAMPUS PREPARED ON BEHALF OF:

NOVEMBER 2015

CONTACT: MOREO RIVERA Real Estate Development and Portfolio University of California, Berkeley 200 A & E Building Berkeley, California 94720-1382 Tel: +1 510 643 8677 Email: [email protected]

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TABLE OF CONTENTS

03 EXECUTIVE SUMMARY

08 PROJECT OVERVIEW

12 MARKETPLACE CONDITIONS

16

20

LODGING MARKET OVERVIEW

SUBMITTAL REQUIREMENTS

27 SELECTION PROCESS AND CRITERIA

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EXECUTIVE SUMMARY

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INTRODUCTION AN EXCELLENT OPPORTUNITY TO DEVELOP A HIGH-QUALITY HOTEL ADJACENT TO THE UNIVERSITY OF CALIFORNIA, BERKELEY The University of California, Berkeley (“UC Berkeley”), through itself or an affiliate, is pleased to invite written proposals from qualified developers to enter into a long-term ground lease agreement with the University and design, finance, and build a high-quality, lodging facility, to be located at 2161 University Avenue and 1990 Oxford Street, adjacent to UC Berkeley. Overall, the site will be comprised of two separate parcels containing approximately 0.41 acres. The site benefits from an excellent location in the heart of the City of Berkeley, adjacent to the UC Berkeley campus, approximately 14 miles northeast of downtown San Francisco and within walking distance of numerous retail and dining establishments in downtown Berkeley. Through this Request for Qualifications/Proposals (“RFQ/P”), UC Berkeley seeks to engage a highly-qualified, financially capable Development Team able to enter into a long-term ground lease with the university and perform all services necessary to successfully develop a full-service or select-service hotel (the “Hotel Project”). This opportunity will allow a potential Development Team to build up to approximately 200 hotel rooms. Following a review of proposals submitted by interested Development Teams, UC Berkeley plans to interview those parties it determines to be best-suited to successfully develop the Hotel Project. UC Berkeley anticipates entering into an Exclusive Negotiating Agreement/Letter of Intent (“ENA” or “LOI”) with the approved Development Team, and then executing a Hotel Development Agreement (“HDA”) and ground lease for the hotel project.

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INTRODUCTION

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BACKGROUND AND CONTEXT THE UNIVERSITY OF CALIFORNIA, BERKELEY: Berkeley is best known as the home of the University of California, Berkeley (“UC Berkeley”). UC Berkeley, a public research university, is the flagship institution of the ten University of California campuses. It enrolls approximately 36,200 students (10,300 of whom are graduate students) in its 14 colleges and schools and over 130 academic departments. In 2015, U.S. News & World Report ranked UC Berkeley first amongst public universities, and it tied for 20th among national universities in the United States. University faculty, alumni, and researchers have won 72 collective Nobel Prizes, and its athletic teams, known as the Cal Bears, participate in the NCAA’s Division I-A as members of the Pacific-12 Conference. The Subject site is currently owned by the Regents of the University of California and encumbered under two separate lease agreements with three small businesses. The site is improved with two single-story commercial structures that are occupied by Mike’s Bikes of Berkeley, Enterprise Rent-a-Car and the Brazil Cafe. Lease agreements with each tenant are expected to expire in August 2017, at which time, a selected developer will have the opportunity to take control of the site. The parcels are identified by the Alameda County Assessors office as APN number 57-2045-3 and 572045-4. HOTEL DEVELOPMENT OPPORTUNITY | BERKELEY, CA | 6

INTRODUCTION

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PROJECT OVERVIEW

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PROJECT OVERVIEW SITE DESCRIPTION: As shown on page 5 of this document, the development site is located on the northwest corner of the intersection of University Avenue and Oxford Street, adjacent to the UC Berkeley Campus and proximate to downtown Berkeley. With approximately 0.41 acres of land, the site will allow for the development of a single structure lodging facility. The lot represents one of the premier development sites in the City of Berkeley, with excellent frontage along both University Avenue and Oxford Street. Given its location adjacent to UC Berkeley, proximate to downtown Berkeley, the site will offer excellent accessibility and visibility. The site’s location near several additional amenities, businesses, and attractions is appealing to business and leisure travelers to the area. These local attractions include, but are not limited to, the following:  UC Berkeley: The site will benefit from an excellent location adjacent to the city’s primary economic driver, UC Berkeley.  Local Businesses: The site will benefit from a thriving commercial area, and the proposed Hotel Project will be located proximate to numerous large companies such as Lawrence Berkeley National Laboratories, Alta Bates Summit Medical Center, Bayer, Kaiser Permanente, and Pacific Steel.  Festivals, Sporting Events and University-related Events: Berkeley is host to a number of large festivals and university-related events that draw thousands of visitors to the city each year. These festivals and events include the Berkeley World Music Festival, Caltopia, Cal Day, UC Berkeley sporting events and UC Berkeley graduation weekend.  San Francisco: While the site’s location is ideal for commercial guests visiting local companies, the hotel will also be well-positioned to capture overflow demand from San Francisco. Due to strong occupancy levels achieved over the past few years, hotels in San Francisco are unable to accommodate visitation levels during peak periods, thus benefiting other hotels in surrounding cities. The proposed hotel is anticipated to benefit from a level of overflow demand from both the business and leisure sectors, as well as from regional conventions at the Moscone Convention Center.

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PROJECT OVERVIEW

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PROJECT OVERVIEW DEVELOPMENT OPPORTUNITY OVERVIEW: With this RFQ/P, UC Berkeley hopes to select a qualified Development Team to design, finance and build a single structure lodging facility. UC Berkeley has designated the site for the potential development of a hotel with potentially a brand affiliation that will accommodate both the business segment and leisure travelers segment. While no specific programming has been considered for this site, a proposed hotel is anticipated to represent an upscale, full-service or select-service hotel, offering a lobby, porte-cochere, lobby bar, and public space to accommodate any potential brand-specific retail or food and beverage offerings deemed critical to the success of the hotel. This hotel development is intended to benefit both the city of Berkeley and the greater East Bay area. To accomplish these objectives, UC Berkeley seeks a Development Team to construct a project with approximately 200 rooms and such support amenities as dining facilities, meeting space, and recreational offerings, though the precise programming and amenity mix will be determined by the developer. Upon entering into a long-term ground lease, UC Berkeley expects that the selected Development Team will have primary responsibility for securing funding for predevelopment, site preparation, necessary infrastructure, vertical construction, and all other expenses and activities necessary to make the project successful while complying with applicable regulations. PARKING: In addition to the Hotel Project site, this offering will also include the ability to purchase, or lease under a long-term agreement, parking spaces from a nearby parking facility controlled by UC Berkeley. The proposed Hotel Project should offer one parking spot for every seven hotel rooms. Alternate ratios will be considered if the developer can justify the recommendation. Negotiations to purchase or lease parking spaces from this nearby parking garage will commence following the selection of a qualified Development Team.

SITE SPECIFICATIONS Parcel Number

57-2045-3 57-2045-4

Site Size

0.41 acres (17,860 square feet)

Address

2161 University Ave., 1990 Oxford St.

Ownership Interest

Leasehold Interest

Site control date for Development Team

August 2017

Zoning

The Hotel Project will be entitled by the University.

Height

115 Feet maximum

Parking Requirements

1:7

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MARKETPLACE CONDITIONS

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BERKELEY MARKET OVERVIEW The City of Berkeley is located on the east shore of the San Francisco Bay in Alameda County. It is bordered by Albany, Kensington, and the San Pablo Reservoir to the north; Contra Costa County to the east; Emeryville and Oakland to the south; and the San Francisco Bay to the west. Berkeley encompasses a total area of 17.7 square miles, of which 10.5 square miles is land and 7.2 square miles is water. The City of Berkeley is identified primarily by the presence of the University of California, Berkeley and by its liberal politics and social activism. The city is world renowned as a center for academic achievements, scientific exploration, free speech and the arts. Berkeley is home to a number of nationally prominent businesses, many of which have been pioneers in their areas of operation. These businesses include Bayer, Kaiser Permanente, Pacific Steel and the Lawrence Berkeley National Laboratory. Today, the City of Berkeley is the site of some of California’s most prestigious academic centers and research institutes, including the University of California, Berkeley; the Lawrence Berkeley National Laboratory; the Lawrence Hall of Science; the Space Sciences Laboratory; and the Mathematical Sciences Research Institute.

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ECONOMIC CONDITIONS Employment Berkeley lies within the San Francisco-Oakland-Fremont MSA. With a strong economy and an educated workforce, unemployment for this metropolitan area has historically trailed that of the state and nation. Unemployment was recorded at 3.8 percent in September 2015, below the statewide and national rates of 5.5 and 5.1 percent, respectively, that month. BERKELEY TOP EMPLOYERS Company

Employees

University of California, Berkeley

14,300

Lawrence Berkeley National Laboratory

4,200

Alta Bates Summit Medical Center

2,500

City of Berkeley

1,500

Berkeley Unified School District

1,200

Bayer

1,100

Kaiser Permanente

600

Pacific Steel

500

Berkeley Bowl

500

Berkeley City College

300

Office Market The Oakland Metropolitan Office market is comprised of office space in Oakland, Berkeley, Richmond, Emeryville, and Alameda. According to the 3rd Quarter 2015 Office Market Report published by CBRE, Inc. for the East Bay-Oakland market, vacancy currently stands at 8.0 percent, down 110 basis points from last quarter’s vacancy levels and 520 basis points over prior year levels. Net absorption during the third quarter was a healthy 456,134 sq. ft. A portion of this net absorption was attributed to occupancy growth in the Berkeley West submarket, where Aduro Biotech leased 56,000 sq. ft. of space. Through the first three quarters of 2015, net absorption has been approximately 1.3 million square feet, which marks the highest total through the first three quarters since 1999 and nearly triple that of 2014 levels. The average asking lease rate for Oakland-East Bay market rose 7.3 percent during the quarter, marking the ninth consecutive quarterly increase. The tightening market has pushed the overall market rate to $2.81 per square foot, the highest total since Q4 2000. All but one submarket saw an increase in asking lease rates, as rates have already grown 41 percent since the market recovery began in 2010. The Berkeley CBD submarket is home to approximately 1.3 million square feet of space. This submarket posted a vacancy rate of 3.0 percent in the third quarter, well below the overall market average of 8.0 percent. Furthermore, the market recorded an average asking rent of $2.83 per square foot in the third quarter, slightly above market averages of $2.81.

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TRANSPORTATION OVERVIEW Oakland International Airport Most visitors to Berkeley traveling by air will fly into the Oakland International Airport (“OAK”), located 14 miles south of the Hotel Project site. Approximately 10,337,000 passengers flew into or out of OAK in 2014, an increase of 6.1 percent over 2013 levels. Through YTD September 2015, passenger traffic has further increased nearly 8.0 percent over prior year levels. OAK is the fourth largest international airport in California and the second largest in the Bay Area after San Francisco International Airport. It offers flights to over 40 destinations in the United States, including services to four Hawaiian Islands as well as to Mexico and Europe. In 2014, the Port, in partnership with BART, completed a $484 million Oakland Airport Connector which runs from the Oakland Coliseum BART station to the airport. With the completion of the connector, OAK now provides directly access to the greater San Francisco Bay Area through rail services provided by BART. Vehicular Transportation Berkeley is served by Interstates 580 and 80 and State Highways 123 and 13. Interstate 580 serves as the gateway east to Interstate 5 and State Route 99, the two primary north-south routes through Northern California. Meanwhile, Interstate 80 is a major east-west route that leads from San Francisco to Sacramento. Downtown Berkeley is conveniently located approximately five miles north of Oakland, 12 miles northeast of San Francisco, and 45 miles north of San Jose.

Bay Area Rapid Transit Public transportation is provided by the Bay Area Rapid Transit (“BART”). BART, a high-speed rail system, is a major commuter transportation system that links 43 stations in the Counties of Alameda, Contra Costa, San Mateo, and San Francisco. BART has had a tremendous impact on the Bay Area, transporting approximately 70 million passengers annually and, thus, facilitating the region’s commercial and residential growth. The Hotel Project site is conveniently located approximately three blocks north of the Downtown Berkeley BART station, facilitating easy access to such destinations as San Francisco, Oakland, and these cities’ respective airports. On August 13, 2015, the BART Board of Directors unanimously adopted the Downtown Berkeley BART Plaza and Transit Area Improvement Project, which will serve as a signature focal point for downtown, improving access to the area. With the downtown Berkeley station currently serving over 30,000 daily transit riders, the project will improve traffic safety and enhance the transit rider experience.

DISTANCE TO NEARBY MAJOR MARKETS City

Distance

Oakland, CA

5

San Francisco, CA

12

San Jose, CA

45

Sacramento, CA

78

Los Angeles, CA

375

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LODGING MARKET OVERVIEW

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NATIONAL LODGING MARKET The outlook for the U.S. lodging industry continues to be bright in 2015. As noted in the table below, revenue per available room (“RevPAR”) for the U.S. lodging market grew by 5.4 percent in 2010, 8.1 percent in 2011, 6.6 percent in 2012, 5.4 percent in 2013 and 8.3 percent in 2014. As a point of comparison, RevPAR declined by 16.7 percent in 2009, the largest percentage decline ever experienced. This significant drop was a direct result of the severe national and global recession which began in the fall of 2007 and lasted well into 2009. Going forward, the overall U.S. lodging market is projected to continue achieving strong RevPAR growth in the near term. According to PKF Hospitality Research (PKF-HR), a CBRE Company, RevPAR is projected to increase over 7.0 percent in 2015 as a result of a 2.2 percent rise in occupancy and a 5.0 percent increase in ADR, the strongest rate growth observed since 2007. Indicative of the breadth of the positive economic climate, all chain-scale categories should enjoy RevPAR growth greater than 6.0 percent in 2015. Additionally, the national occupancy is projected to reach the highest level ever achieved, over 66.0 percent, in 2016.

National Lodging Market $175

70%

$150 65%

$125 $100

60%

$75

ADR RevPAR Occupancy

$50

55%

$25

$0

50% '10

'11

'12

'13

'14

'15*

'16*

'17*

'18*

'19*

Footnotes 1 Source: PKF-HR’s Hotel Horizons® September – November 2015 National Edition 2 The periods denoted by an asterisk indicate projected performance. HOTEL DEVELOPMENT OPPORTUNITY | BERKELEY, CA | 17

BERKELEY-OAKLAND LODGING PERFORMANCE The following section provides an overview of the Berkeley-Oakland hotel market, based on data reported by individual properties within the market and compiled by PKF Hospitality Research. This data is intended to provide bidders with summary information pertaining to the Berkeley-Oakland market, and should not be relied upon for the basis of their proposals. Proposers and bidders should make their own analyses of market conditions prior to submitting an RFP. The market currently features approximately 9,400 rooms, ranging in chain scale from small economy scale hotels to large upscale full service properties. While the Berkeley-Oakland market, like nearly all markets across the United States, was affected by the national recession of 2009, average daily rate (“ADR”) has rebounded strongly since, exceeding pre-recessionary peak levels. As noted, despite a modest decline in ADR in 2010, occupancy levels for the lodging market have continued to increase in each individual year since 2009. Coupled with strong ADR growth over the past five years, the market has achieved double digit RevPAR growth between 2011 and 2015 (estimated). The table provided to the below details the Berkeley-Oakland market’s occupancy and ADR performance for the years 2009 to 2014, as well as through year-to-date July 2014 and 2015. HISTORICAL PERFORMANCE OF THE BERKELEY-OAKLAND LODGING MARKET Market Percent Percent Year Occupancy ADR Change RevPAR Change 2008 64.2% $102.78 $65.96 2009 57.5% $91.27 -11.2% $52.48 -20.4% 2010 62.3% $88.83 -2.7% $55.34 5.5% 2011 67.1% $94.38 6.2% $63.33 14.4% 2012 73.3% $101.87 7.9% $74.67 17.9% 2013 75.1% $111.66 9.6% $83.86 12.3% 2014 78.4% $122.63 9.8% $96.14 14.7% CAGR 3.0% 6.5% YTD Jul '14 75.6% $116.09 $87.76 YTD Jul '15 79.6% $129.51 11.6% $103.09 17.5% Source: PKF Consulting | CBRE Hotels Note: market data is comprised of a hotel sample size of approximately 9,400 rooms

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COMPETITIVE BERKELEY LODGING PERFORMANCE The following section provides an overview of the local Berkeley competitive lodging market, based on data reported by individual properties within the market and compiled by PKF Hospitality Research. Similar to the Berkeley-Oakland market, this data is intended to provide bidders with summary information pertaining to the local lodging market, and should not be relied upon for the basis of their proposals. Proposers and bidders should make their own analyses of market conditions prior to submitting an RFP. As noted in the table below, the competitive lodging market features approximately 1,681 rooms, generally comprised of nationally-affiliated upscale, full-service and select-service, properties. Since 2008, with the exception of 2009, market occupancy has ranged between the low 70 to 80 percent range. During this period, ADR increased significantly as the market achieved rates of nearly $168 in 2014, approximately $31 above rate levels achieved in 2008. Similar to the overall Berkeley-Oakland market, given the strong increases in both occupancy and ADR, the competitive lodging market has achieved double-digit RevPAR growth since 2011.

BERKELEY COMPETITIVE SET Hotel

Rooms

Four Points by Sheraton Emeryville

153

Doubletree Berkeley

378

Courtyard Emeryville

296

Hilton Garden Inn Emeryville

278

Hyatt House Emeryville

234

Hotel Durant

143

Hotel Shattuck Plaza

199

Total

1,681

HISTORICAL PERFORMANCE OF THE COMPETITIVE LODGING MARKET Market Percent Percent Year Occupancy ADR Change RevPAR Change 2008 71.3% $136.58 2.7% $97.41 14.1% 2009 66.4% $118.91 -12.9% $79.01 -18.9% 2010 72.3% $116.06 -2.4% $83.88 6.2% 2011 77.3% $124.98 7.7% $96.56 15.1% 2012 82.1% $139.06 11.3% $114.19 18.3% 2013 80.9% $155.32 11.7% $125.67 10.0% 2014 82.6% $167.87 8.0% $138.68 10.4% CAGR 3.5% 6.2% YTD Aug '14 82.4% $166.80 $137.47 YTD Aug ‘15 84.1% $179.79 7.8% $151.17 10.0% Source: PKF Consulting | CBRE Hotels Note: Competitive market data is comprised of a hotel sample size of approximately 1,681 rooms

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SUBMITTAL REQUIREMENTS

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SUBMITTAL REQUIREMENTS This section summarizes the basic requirements for all submittals and provides an overall schedule for the preparation, review, and selection process. Contact, Delivery, and Schedule All responses to this RFQ/P must be submitted on or before 5:00 P.M. PST on February 1, 2016 to the following address and contact: MOREO RIVERA Real Estate Development and Portfolio University of California, Berkeley 200 A & E Building Berkeley, California 94720-1382 Tel: +1 510 643 8677 Email: [email protected]

UC Berkeley requests five (5) hard copies of the full proposal and one electronic copy on a flash memory device or by e-mail (preferably in PDF format). Late proposals and incomplete proposals may be rejected. As soon as it is known, but no later than 5:00 PM on Friday, December 18, 2015, all potential proposers shall submit a statement of their intent to submit a proposal to UC Berkeley. This notice of intent shall include the bidder’s company name, address, primary contact, and primary contact’s email address and telephone number. This notice of intent shall be emailed to Moreo Rivera at the email address listed above. To maintain an open process, we request that all questions be directed via e-mail on or before January 13, 2016 to the contact person above. UC Berkeley will respond to all questions (without attribution) to be made available as an addendum to this RFQ/P and published on the web site referenced below. No information other than that flowing through these channels will be provided once the RFQ/P has been released. In addition, interested parties may participate in the Bidders Conference, as described further herein. The California Public Records Act limits the University's ability to withhold prequalification information. If a submittal contains trade secrets that a developer does not want disclosed to the public or used by the University for any purpose other than evaluation of the developer's eligibility, each page (both hard copy and electronic) containing such information must be marked with the designation "Confidential". The University agrees that if a "Public Records Act" request is made for disclosure of information so classified, it will notify the submitter of such information so that the submitter will have an opportunity to legally challenge the University's obligation to disclose such information.

The following website provides a number of documents in addition to a copy of this RFQ/P. It also includes notices concerning important dates and events. As noted above, answers to e-mailed questions will be posted to this website and any additional notifications will also be posted. http://www.cbredealflow.com/

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SUBMITTAL REQUIREMENTS (CONTINUED) The overall schedule for the RFQ/P process is summarized below: ACTION / EVENT

SCHEDULE / DEADLINE

UC Berkeley release of RFQ/P

December 2, 2015

Deadline for Notice of Intent to Submit Proposal

December 18, 2015

Bidders Conference (Details provided below)

January 6, 2016 (11:00 A.M. PST over teleconference)

Deadline for Submission of Questions Related to the RFQ/P

January 13, 2016

Deadline for Submissions to RFQ/P

February 1, 2016

Interviews with Selected Team(s)*

Week of February 15, 2016

UC Berkeley Consideration*

February 29, 2016

ENA Period*

March 7 - March 31, 2016

*Denotes dates are tentative and subject to change

As noted, UC Berkeley will be hosting a Bidders Conference via teleconference to answer any questions related to this RFQ/P on January 6, 2016. Interested parties will be provided with a call-in number to participate in the teleconference. Instructions for GoToMeeting will be sent to all potential bidders prior to the date of the scheduled call. Qualifying Bidders will be eligible to receive additional development and financial information upon execution of requisite Confidentiality Agreement (“CA”) for the project. Content and Organization of Submittals Respondents to this RFQ/P are requested to supply all the information described herein, in a complete yet concise format. UC Berkeley expects submittals to provide enough information to allow staff and other advisors to evaluate and rank qualifications of the Development Teams. The use of standard or stock company marketing materials is discouraged except with respect to resumes or limited general information concerning the company or firm. The Submittals must follow the order and reference each of the numbered categories listed and described on the following pages:

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SUBMITTAL REQUIREMENTS (CONTINUED) 1. Cover Letter Provide a cover letter introducing the Development Team and identifying the basic submittal contents and the primary contacts or representatives. The cover letter must be executed by an officer or other authorized representative of the Development Team. The cover letter shall identify and explain any significant conditions, limitations, special requirements, reservations or conditions that the Development Team will require before signing an ENA or HDA. If none, please state “none.” For example, if certain agreements or assurances must first be in place before work can commence or third party approvals are required to receive necessary funding, identify these. In addition, identify any current or recent commitments or contracts that might be perceived as a conflict with the subject Project. Development Teams with clearly stated requirements that are reasonable and limited in number will receive preference. The cover letter shall also contain statements confirming that the undersigned represents and warrants the following: a. It has read the RFQ/P and agrees to abide by the contents and terms of the RFP/Q; b. All factual statements contained in its Submittal are true and correct; and, c. Development Team will not add, remove or substitute any Equity Member or key individuals without the written consent of UC Berkeley. 2. Overview of the Development Team This section should provide an overview of the Development Team, including a summary of legal status, organizational structure, and roles and responsibilities of key Team members and individuals. Specifically, the following items should be covered: a. Team Contact Information, Organization, and Capacity: Identify the Development Team and describe its organizational status including company name(s), legal status, address, the anticipated equity ownership structure, and any contractual or other joint-ownership arrangements which bind the Development Team. Identify any ownership or organizational changes anticipated during the development and operation of the proposed Hotel (e.g. when construction is complete). Also summarize/confirm the Team’s capacity (especially human capital) to take on a project of this depth, complexity, and lengthy time duration, identifying any current commitments to other projects. b. Team Roles and Responsibilities: Identify the role of each member of the Development Team in the implementation of the development. Where more than one Development Team is being proposed (a multi-team proposal), be very specific as to the qualifications of each partner/member and what he/she will be contributing financially and organizationally. The Proposer should also clearly identify each individual or entity that will own or hold an equity ownership interest in the Developer Team entity or the Project. Include organizational chart(s) showing the internal organization of the Development Team including the respective relationships between team members and the reporting relationships of team members. Multiple charts may be provided, especially if changes are anticipated after the development and construction of the Project. Please also explain carefully how decisions will be made amongst the members, how disagreements will be resolved, and who will be the lead owner and decision maker. c.

Key Individuals: In addition to information about the Development Teams, UC Berkeley is soliciting detailed information concerning each individual or entity which will own any equity interest in the project (“Equity Member(s)”), as well as certain individuals that are critical to the success of the proposed Hotel (“Key Individuals”). By identifying Key Individuals in the Submittals, the proposer is warranting to UC Berkeley that such individual will be available for, and will be assigned to work on, the project. Identify and distinguish principals from both equity and non-equity team members that will be responsible for providing oversight, supervision or management service to the project, and reference their resume/CV (to be provided in an Appendix).

d. Design team: The Development Team will provide a list of the primary consultants that will support the project development including the architect and their subconsultants. HOTEL DEVELOPMENT OPPORTUNITY | BERKELEY, CA | 23

SUBMITTAL REQUIREMENTS (CONTINUED) 3. Qualifications and Experience This section should document the qualifications and experience of the Development Team. Specifically, it should provide information that demonstrates the qualifications and professional expertise of the Development Team and its individual members. It should also include an overview of your specific familiarity and knowledge of the San Francisco Bay Area market and its real estate parameters, especially those related to hospitality and the local community. In addition, the Proposer should provide the relevant development experience of the Development Team with respect to similar hotel projects where the team held a financial interest throughout the duration of the project. A focus on the background of the individuals assigned to this effort is suggested (include references to resumes/CV added as an Appendix). Please provide a minimum of three (3) relevant, recent projects with construction value in excess of $25 million. For each project identified, provide the following information: a. Project Name, Location, and Date completed. b. Project Description: Describe the project in terms of its size, market orientation, ownership structure, and current status. Provide appropriate graphics as available (interior and exterior), but no more than four per project. c.

Development Cost and Financing: Provide an estimate of the total project development cost and the financing mechanisms/resources utilized, including role of public entities, if any.

d. Development Schedule and Performance: Planned and actual development timeline (from Development Team selection/site control to completion of construction, indicating any phasing if relevant) with an explanation of material variances, as well as a summary of its economic or market performance (if applicable). e.

Role or Scope of Work of the Respective Members of the Development Team: Indicate the role of the Team members assigned to this effort for the referenced projects. Please exclude discussion of projects in which the Development Team members did not play a major or material role.

f.

Project Reference: At least one reference is required for each project listed. Include the reference’s name, title, address, email, and telephone number.

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SUBMITTAL REQUIREMENTS (CONTINUED) 4. Financial Capacity Provide financial information necessary to demonstrate that the Development Team will have the necessary financial standing, capacity, experience, and resources to undertake, finance, and deliver the Project. Note that all materials submitted under this Section may be separately sealed and marked as “Confidential and Proprietary Commercial Information” at the Proposer’s discretion. The Development Team and each Equity Member must submit: a. Copies of audited financial statements, annual reports and auditor’s opinion letter, or other similar information, for each of the last two years for which such information is available. b. A narrative describing any material events that may affect the entities’ financial standing since the last audited or interim financial statements. c.

A narrative describing any material off-balance sheet financing arrangements in place that cumulatively exceed $20 million in the aggregate.

d. Credit rating, if available. e.

Current Real Estate Portfolio: Composition of current real estate portfolio including product types owned, amount of square footage, ownership structure of the assets, etc.

f.

Project Pipeline: Provide a description of all material projects (including the estimated cost) that any Equity Member has committed, or is contractually obligated, to deliver within the next five years including status, development schedule and financial commitment required (e.g. financing methods, sources, and amounts).

g. Litigations or Adverse Actions: Indicate whether any funding sources or financial institutions have taken any adverse action against the Development Team or joint venture partner, such as terminating or restricting the use of funds anytime during the past five years. Also indicate any litigation in which the members of the Development Team are involved or settled litigation over the last five years, if any. h.

A copy of the annual report on Form 10K must be provided if the team or any other entity for which financial information is submitted as required hereby files reports with the Securities and Exchange Commission.

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SUBMITTAL REQUIREMENTS (CONTINUED) 5. Project Concept and Financial Profile Proposal Although the Specific Plan outlines a certain scale and set of amenities for the Project, this is not intended to limit Proposers’ creativity or ability to propose an alternative scale or set of features and amenities deemed to better suit the goals of the overall development site. Consequently, UC Berkeley is requesting the Proposers to describe their concept and vision for the overall project with as much specificity as possible. This should include, but not necessarily be limited to, project size and configuration (e.g., number of rooms, floors, and total square feet), brand, amenities, parking plan, and visual/architectural renderings. Architectural design quality is a high priority for project. The Proposer should seek to demonstrate knowledge and a full understanding of the project’s exceptional potentials as well as unique challenges. The Development Team may also use this section to describe its specific reasons, motivations, and goals for undertaking the project. UC Berkeley reserves the right to participate in final approval of the Project scale, features and amenities, and the globally recognized lodging brand. In addition to the foregoing, please describe whether and to what extent your proposed hotel operator/partner would consider entering into a “labor peace or neutrality agreement” with any bona fide labor organization that represents hotel employees in Alameda County, California. Proposers shall also provide a detailed financing plan that includes structure and type of debt and equity and the basic financial terms for property acquisition and Project development. The proposal should detail the basis and form for any requested public participation and the type and level of UC Berkeley’s exposure to additional financial risk. If the Development Team has a minimum IRR hurdle rate requirement for its invested capital, or the need to obtain second or third party approvals to proceed or receive funding, please clearly state these.

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SELECTION PROCESS AND CRITERIA

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SELECTION PROCESS AND CRITERIA This RFQ/P is the first step in considering the selection of a qualified Development Team to develop a new hotel on a 0.41 acre site at the intersection of University Avenue and Oxford Street. Subsequent to receiving qualifications packages from interested parties, UC Berkeley staff and its advisors will review and screen the list of candidate Development Teams down to selected finalists. The finalists will be asked to participate in an interview with UC Berkeley and its selected advisors. Based on the submittal materials, the interview, and the application of the criteria described below, UC Berkeley will select a top-ranked team. The selected Development Team will be awarded an exclusive right to negotiate the terms of property disposition and development. Although the exact terms and conditions for ENA will be determined subsequent to selection of a preferred Development Team, this agreement is likely to span about three months and include a number of benchmarks and milestones against which commitment and performance will be judged. Substantial deviations from the terms outlined by the Proposer in response to this RFQ/P will be grounds for disqualification. UC Berkeley does not warrant or promise to select a finalist Development Team and reserves the right to determine its best course of actions. UC Berkeley also reserves the right to select a preferred Development Team based on the response to this RFQ/P, foregoing the interview process, if it is determined at its sole discretion that it is advantageous to do so. Further, UC Berkeley reserves the right to modify the terms and conditions of this or subsequent offerings, and to alter the selection process, criteria, and timetable as circumstances require, including making no selection at all. Each proposal will be evaluated in its entirety with all of the submittal requirements described above being considered as appropriate. In conjunction with the evaluation of each Submittal for responsiveness and conformance to the RFQ/P, UC Berkeley will evaluate each Submittal based upon the following primary criteria: 1. Team Qualifications and Experience. UC Berkeley will carefully evaluate the qualifications of the Development Team, and the specific personnel assigned to this project, in terms of their experience developing comparable hotel projects. Specifically, the group is looking for demonstrated success with hotel projects having high-quality design features and components, attention to detail, excellence in land planning, and innovative, memorable features, consistent with UC Berkeley’s goals for the development site.

2. Financial Capacity and Acumen. UC Berkeley will evaluate the Development Team’s demonstration of a credible ability to provide adequate funds to acquire and develop a large-scale real estate project of this nature. The financial and organizational capacity of the proposed development entity that will be signing the ENA/DA will be of critical importance. The proposal shall include the disclosure of current uncommitted equity capital on hand, lines of credit available, and estimates of how much debt and equity could be made available for this project. Selection will be significantly weighted in favor of those responses that include strong equity capacities backed by quantified information. 3. Project Concept / Business Model. It is UC Berkeley’s goal to attain the most distinctive, highest-quality, and most marketable Project possible. Most importantly, the project should be synergistic to the overall integrated resort and should enhance the guest experience. The Project should be a good fit given the specific characteristics of the market and should describe the target segment and the marketing strategy in sufficient detail.

4. Financial Proposal. Relative strength of the financial proposal as it addresses the value of real property, construction costs and common-area services 5. Special Requirements before ENA/DA Signing. UC Berkeley will consider the implications of any significant conditions, limitations, special requirements, reservations or conditions precedent that the Development Team will require before signing an ENA and/or DA. Development Teams shall clearly and candidly state special requirements in the proposal. Special requirements that are reasonable and limited in number will get preference.

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GENERAL CONDITIONS Any material clarifications or modifications to the RFQ/P or the selection process will be made in writing and provided to all registered proposers. It is the responsibility of the Development Team, before submitting a response to the RFQ/P, to ascertain if any notices, clarifications, addenda, or other communications to responders have been issued by UC Berkeley. Oral explanations or instructions from UC Berkeley staff, board members, or consultants shall not be considered binding. Development Teams' responsiveness to all items in this RFQ/P will be taken as evidence of the Development Team's interest and commitment to the project. A failure to respond completely will be interpreted as a lack of full interest and commitment or a deficiency on the Development Team's part. UC Berkeley reserves the right to:  Modify or cancel the selection process or schedule at any time.  Waive minor irregularities.

 Reject any and all responses to this RFQ/P and to seek new submissions when it is in the best interest of UC Berkeley to do so.  Seek clarification or additional information or evidence from individual respondents, including but not limited to evidence of the Development Team's financial status.  Judge the Development Team's written or oral representations as to their veracity, substance and relevance to development of the site, including seeking and evaluating independent information on any Development Team.  Incorporate this RFQ/P and the selected team's response to this RFQ/P as a part of any formal agreement between UC Berkeley and the Development Team.

 Modify the development opportunity available to potential Development Teams. All expenses related to any Development Team's response to this RFQ/P, or other expenses incurred during the period of time the selection process is underway, are the sole obligation and responsibility of that Development Team. UC Berkeley will not, directly or indirectly, assume responsibility for these costs. In addition, UC Berkeley shall not be liable for any real estate commissions or brokerage fees which may arise as a result of the Development Team selection process. The proposer shall not offer any gratuities, favors, or anything of monetary value to any official, employee, or outside consultant associated with the development of the site for purposes of influencing consideration of a response to this RFQ/P.

UC Berkeley makes no representations about the conditions of the site, including utilities, soils, or other surface or subsurface conditions. The respondent shall make its own conclusions concerning such conditions. Information provided in this RFQ/P, as well as in related reports by UC Berkeley staff or consultants, is provided for the convenience of the responders only and is not intended to be exhaustive. The accuracy or completeness of this information is not warranted by UC Berkeley.

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CONTACT:

MOREO RIVERA

Real Estate Development and Portfolio University of California, Berkeley 200 A & E Building Berkeley, California 94720-1382 Tel: +1 510 643 8677 Email: [email protected]

HOTEL DEVELOPMENT OPPORTUNITY | BERKELEY, CA | 30

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